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Department of State and U.S. Information Agency

Recommendations and Actions

DOS04: Provide Leadership in the Department's Information Management

Background

In many ways, the State Department is like a highly complex private sector company with a multinational presence and considerable overseas resources. To such an entity, the rapid flow of accurate information is vital. In fact, many such companies have failed because of a fragmented approach to information management. Many businesses would not be in existence today if they had not recognized this problem and reengineered their business processes by consolidating and centralizing their information and technology resources. Information management infrastructure requirements were an integral part of their strategic planning efforts.

The State Department's information systems are currently in a state of crisis. The Office of Management and Budget (OMB) has identified the department's information management systems as a high-risk area, noting that "worldwide systems could suffer from significant downtime and even failure."(1) According to a State Department official, the department has determined that a total of 63 posts around the world are operating on obsolete hardware. The maintenance costs for this old, closed-system hardware are increasing, and new mainframes must be procured to meet minimum backup requirements. Many bureaus within the department operate on hardware and software that is incompatible with that used in other bureaus. Often, the hardware and software do not meet day-to-day needs.

The department is now planning for a migration from the existing closed system to an open system. The first step in this migration plan is to set standards for the department's administrative, financial management, and consular affairs functions. However, the fragmented budgeting and decision making processes of the department, addressed elsewhere in this report, are hampering progress toward a new system. OMB has expressed concern over the department's piecemeal approach to its information systems problem and has questioned the department's ability to implement the migration plans effectively.(2)

The modernization process at the State Department is complicated by the following three major factors:

--- a lack of management authority in information management,

--- stovepipe systems, and

--- an ongoing reorganization initiative.

Lack of Authority. Although the State Department has an information management office, this office lacks the authority and stature to set departmentwide policy and standards. This problem is not unusual. Typically, information management officers in various organizations lack the corporate standing to be effective partners with other high- level executives in setting information management policies and managing resources. The State Department is no exception. Without the backing of the most senior-level officials in the department, the State Department's Designated Senior Official (DSO) for information management will continue to be unable to set departmentwide policy.

Stovepipe Systems. The second major problem faced by the State Department is the unique computer systems purchased in the late 1970s through the mid-1980s. The department invested approximately $500 million in proprietary hardware and software.(3) It slowly acquired various generations of minicomputers, workstations, and personal computers, which are now deployed worldwide. Each systems development effort focused on specific operational requirements, resulting in stovepipe systems that neither meet overall department needs nor allow communication across organizations. Sharing information within the department is difficult and virtually impossible with external systems. Re-entry of data into multiple systems is a common practice.

This situation has led to the emergence of separate support teams within the department's organizational structure and at overseas posts. As the aging base of computer equipment has required more maintenance, technical support responsibilities have been assumed by individual bureaus. Consequently, the Information Management Office has been further isolated from effective policy development, planning, budgeting, and day-to-day management.

Program and hardware restrictions also hamper the efficient use and presentation of information. This is exemplified by the case of the department's financial management system, which has been targeted for replacement. The State Department is unable to provide useful and detailed budget data on many of its operational programs due to the inability to run certain types of programs on the current hardware. This problem has been identified as one of numerous systemic problems, exposing the department to the risk of fraud, waste, and abuse.(4)

Reorganization Effort. Finally, the information management processes are affected by the State Department's current reorganization initiative. Specifically, before new systems can be installed, the department must first identify its information management requirements and priorities. Independent of how the department finally reorganizes, the critical data groups--i.e., the categories of data to be collected and stored--must be identified. Only then can the department determine the architecture of its system.

Each of the above factors must be considered if the department is to remove barriers to effective, efficient, and customer-oriented information management. It is important that the department move rapidly to open-systems hardware in order to prevent systems failure and achieve lower maintenance costs (which the State Department estimates will total $33.4 million from 1993 to 1996, if there is no improvement in the current systems).(5) However, this goal must be balanced against the departmentwide need for a long-term, systematic approach to information management.

Successful migrations to better information systems have frequently been implemented in the private sector through a two-phase process. In the first phase, management establishes control over the information management infrastructure by determining how information is collected and managed. Strategic planning is a critical part of this first phase. When analyzing infrastructure requirements, the future demands for information services must be identified and studied. Implementation procedures and processes then may be clearly defined based on these requirements and measurable objectives. Another important step driving this phase is the immediate realignment of resources to construct a more centrally managed information management infrastructure.

The second phase focuses on improving the overall effectiveness and efficiency of the new infrastructure. A central office sets information management policy for the entire organization while the daily operations of each division are conducted by local operators. This is the best approach to systems migration, and the State Department should pursue this general strategy. It is important to note that success depends heavily on the order in which the above steps are implemented.

The President's fiscal year 1994 budget request to Congress included a program increase of $10 million for the department's computer migration effort and $4 million for financial systems redesign. The department is currently refining a cost estimate and implementation plan, which could show a need for an additional $155 million for this project. In order for the department to modernize its mainframes, and its domestic and overseas computer networks and to provide extensive training to its work force on the newer systems, the Department of State may have to invest as much $500 million over the next 7 to 10 years.

Actions

1. The State Department should establish a position for development and oversight of departmentwide information management policy.

The individual selected to fill this position would be appointed as the DSO for information management and report directly to the Under Secretary for Management. The DSO's sole responsibility would be to develop and oversee the implementation of a coherent departmentwide information management policy. Elevating these issues to the Under Secretary level should give the DSO the stature, visibility, and influence to integrate policy and standards across geographic and functional bureaus. In addition to setting policy, the DSO should lead migration planning and execution. The DSO's office would be responsible for promoting departmental and interagency coordination on information management issues; responsibility for day-to-day maintenance and operations would remain with the information technology officers in the individual bureaus.

2. The State Department should use private and/or public sector expertise in developing a departmentwide strategic plan for migrating to open systems.

These experts would be charged with assisting the department to identify the information and programs to be converted before migrating to new systems. The strategic plan should describe organizational impacts, schedules for training all affected personnel, and investment costs and savings. The plan should also create a process for the continued modernization of information systems in the future.

Implications

By implementing the above approach, the department will address the turf wars that have prevented significant progress in the past. The migration effort itself, which is unavoidable, will involve considerable cost, and may cause significant job dislocation. Without a single, high-level manager empowered to coordinate migration policy and to oversee and control the process, chances for success are limited. Furthermore, the effective management of information resources is threatened.

Fiscal Impact

The above recommendations pertain only to streamlining and improving information management. They do not address the acquisition of a new system. The costs associated with creating a new DSO office are minimal and can be met with current resources. The increased long- term efficiencies to be realized from minimized redundancy in the system, improved coordination, and easier exchange of information will not only produce significant long-term savings, but improve the department's capacity to carry out its mission. The specific fiscal impact cannot be estimated at this time.

Endnotes

1. U.S. Office of Management and Budget, Budget of the United States Government--Fiscal Year 1994 (Washington, D.C., 1993), p. 120.

2. Ibid.

3. Littrel, Warren, as cited in "Major Program to 'Migrate' to More Modern Computers Is Launched," State (March 1993), pp. 15-17.

4. U.S. Department of State, "Information Strategy Plan for the Bureau of Finance and Management Policy," Washington, D.C., May 14, 1993.

5. U.S. Department of State, "Open Systems Migration Implementation Plan," Washington, D.C, January 8, 1993.

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