Forecast: Rising Expectations Challenge Government IT Leaders

With a new federal administration taking over in less than two weeks and prevailing concern over budget cuts and unemployment, citizens and public officials alike are wondering what the future holds for government. On Jan. 9, IDC’s Government Insights held a Web conference to address this growing concern.

As part of Industry Insights’ series of Top 10 Predictions for 2009 Web conferences, five Government Insights executives highlighted trends for the new year based on analyses of their latest research. Government Insights is a research-based advisory and consulting service that aids in IT business decisions. Moderated by Practice Director Thom Rubel, the organization’s presentation also details steps government can take as they plan IT investments for 2009.

With a $3 billion increase in the federal IT budget and 3.4 percent growth rate, the government is the largest buyer of IT. However, the conference addressed four key issues that will impact government use of IT in the coming year. First, the faltering economy will force the government to take up a new business role, stepping in as an overseer of financial institutions. As Rubel explains, the government will have to “become a partner and a manager in a business essentially.” This will require public officials to learn a new set of business and IT skills.

Second, the new economic issues and new leadership have created new expectations of government. Citizens insist that the government help to rebuild the economy, and also keep them better informed through a more transparent government. Government will also be focused on economic recovery, creating various programs and even altering its priorities to improve finances.Finally, with this year’s tight fiscal environment, investment optimization will be critical to saving money while improving capabilities.

Government agencies will clearly face various challenges in 2009. Below are the executives’ 10 predictions for government in 2009, as well as advice for the government in managing its 2009 IT budget.

1. Government Will Struggle With Its New Business Role Partner, banker, financial manager -- all these roles are new for government. Despite pressure on government to take up these roles immediately and successfully, officials still need to learn the new skills and technologies necessary to master these responsibilities. Rubel predicts that government will look to the private sector for proper business practices and IT solutions. There is a concern in government, however, that private-sector practices are part of what led to the financial situation today. Rubel explains that “the challenge for the vendors serving [government] will be to reinforce and show results that really have worked in the private sector.
2. Cyber-Attacks Will Threaten Financial Systems Despite security improvements, cyber-attacks will continue, becoming more and more sophisticated. As Government Insights Research Manager Mark Kagan explained, government is a “very attractive target [for cyber-attacks] in terms of the hundreds of billions of dollars” flowing through agencies. The government must plan ahead and prepare for these attacks before they occur.
3. The Government Talent Pool “Leak” Will Slow, but the Right New Talent Will Be Hard to Find According to Government Insights, the retirement “bubble” will not be such a significant issue due to many officials putting off retirement amid current financial instability. However, finding workers who bring fresh ideas and innovation to meet new demands might be difficult. There is little room for more staff due to tight budgets, especially in state and local governments, where they’ve had to have more layoffs. However, President-elect Obama has pledged to create 600,000 new government jobs, so finding the right people will be a main focus.
4. Fraud Detection Will Be Necessary to Protect Health-Care and Finance Programs Because programs in health-care and finance have an increasing budget for 2009, fraud will be a threat that must be