Report 94022 Summary - December 1994

The State Needs To Reengineer Its Management of Information Technology

Results in Brief

The State's use of information technology has increased steadily over the years and now must be considered one of the State's most critical investments. The State currently spends an estimated $1.3 billion annually on information technology. The Office of Information Technology (OIT) within the Department of Finance is the office that has overall responsibility for the State's information technology investment.

The State's current model for managing statewide information technology does not work. The OIT has not provided the statewide leadership and coordination for information technology as intended by the 1983 legislation that established the office. Additionally, the OIT's oversight of information technology projects is limited and does not ensure that state departments implement projects successfully. Specifically, we noted the following:

These problems have occurred because the OIT has narrowly interpreted its enabling legislation in such a way that it effectively limited its authority over information technology matters. Additionally, the OIT's resources have not kept pace with the growth in the State's information technology, and the OIT has chosen to focus these limited resources on budgetary oversight rather than statewide leadership.

The State's Information Technology Program Needs To Be Reengineered

Because of these deficiencies, the State must reengineer the entire statewide information technology program to ensure that the State's interests and assets are protected and used to their maximum potential. To initiate the reengineering process, the State should establish a statewide chief information officer (CIO) position. The CIO should serve as a member of the governor's cabinet and head a new statewide information resources office.

The CIO and the information resources office should be given the powers, duties, and responsibilities to develop and implement a statewide plan for information technology. They should provide leadership and guidance to departments, manage and coordinate statewide resources, and monitor and oversee projects based on a risk assessment. In addition, the State should reevaluate the commitment of resources for managing its information technology. Finally, the State will need to address the statutory changes necessary to complete the reengineering process, and the proposed CIO will need to implement appropriate procedural changes.

Agency Comments

In its response, the Department of Finance (DOF) states that there are many issues throughout the audit report with which it agrees. However, the DOF also responds that it has a number of fundamental, philosophical differences with us on how to manage information technology in the State as well as a few specific disagreements. In particular, the DOF is concerned about the balance between centralized versus decentralized control of information technology projects.

Although the DOF believes that it is now appropriate to reconsider how the State manages its computer and telecommunications technologies, it also believes that the OIT has met its assigned responsibilities and made substantial contributions to the State's successes in using information technology. Our comments follow the response from the DOF.

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