May 02 2013

How Worry About Risk Can Hamper IT

Agencies shouldn’t let concerns about risk prevent them from maximizing the value of technology projects, CIS’ Schwartz tells GITEC audience.

“Everyone says we need to do more with less,” said Mark Schwartz, CIO of the Homeland Security Department’s Citizenship and Immigration Services agency. But a better strategy, he suggested, is to “create more value with less.”

In a keynote speech at the GITEC 2013 Summit this week in Baltimore, Schwartz explained that agencies can create value by eliminating waste that can be found in in the requirements established for a given IT project as well as in the steps taken to mitigate risk. Agencies spend irresponsibly on ineffective ways to mitigate risk, he added.

"How can we create more value with less, rather than doing more with less?"

In his speech, Schwartz took issue with a federal contracting culture that equates risk with failure. He stated that in trying to mitigate risk, agencies go through a laborious process to create an extensive list of requirements for each project. However, he said, studies have shown that the vast majority of features in IT projects are seldom used at best, so requirements that establish these features demand waste.

“Given that two-thirds of features are rarely or never used — and this is really the biggest risk if you believe that we’re overbuilding by two-thirds — the biggest risk is really that the contractor will deliver what they say they’re going to, because then you’ve wasted two-thirds of your money,” Schwartz stated. “It’s guaranteed.”

And independent verification and validation efforts to ensure that a project’s requirements were met simply confirm that these costs were wasted, he added.

“When you add all these costs for risk mitigation activities, they dwarf” the amount agencies spend on the parts of a project that actually add value, Schwartz said.

It’s difficult to avoid wasting time and money on mitigating risk, especially in a culture in which concerns about risk are so ingrained, he recognized. But in a budget environment where every agency is trying to save money, there may be significant cost reductions to be found in addressing wasteful efforts to mitigate risk.

Watch highlights from Schwartz’s keynote here:

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