EA and Investment Planning

Enterprise Architecture in the US Federal Government is closely tied with IT investments.

Each IT investment must clearly demonstrate that the investment is needed to help meet the agency’s strategic goals and mission by demonstrating how the investment supports a business line or enterprise service performance goal as documented in a Segment of the Agency’s Enterprise Architecture. (Source: Exhibit 53 Guidelines)

Every financial year, a “Federal IT Investment Portfolio” is published as part of the President’s Budget. Guidelines for FY2013 have just been issued by The Office of Management and Budget (OMB), who provides procedural and analytic guidelines for agencies. The two most important agency deliverables for the CIO are the “IT Capital Asset Summary” (Exhibit 300A) and “Agency IT Investment Portfolio” (Exhibit 53A), which together demonstrate the agency’s management of IT investments and how governance processes are used to plan, select, develop, implement and operate IT investments.

Exhibit 300s and the Exhibit 53
Together with the agency’s Enterprise Architecture program, exhibits 300s and 53 define how to manage the IT Capital Planning and Control Process in a federal agency. Exhibits 300s establish policy for planning, budgeting, acquisition and management of major information technology (IT) capital investments, and Exhibit 53 defines the agency’s IT Investment Portfolio.

The Exhibit 53 is composed of two parts: Exhibit 53A, “Agency IT Investment Portfolio,” which includes IT investment budget and architecture information, and Exhibit 53B, “Agency IT Security Portfolio,” which includes a summary of agency and bureau IT security information, including IT security costs. Exhibit 53A is a tool for reporting the funding of the portfolio of all IT investments within a Department while Exhibit 300A is a tool for detailed justifications of major IT Investments. Exhibit 300B is for the management of the execution of those investments through their project life cycle and into their useful life in production.

Architect, Invest, Implement
Sections 300 and 53, together with the Agency’s Enterprise Architecture are managed to create a Performance Improvement Lifecycle for the Agency. This lifecycle is broken into three phases: “Architect”, “Invest” and “Implement”. Exhibits 300 and 53 are predominate management tools for managing the “Investment” phase of the Performance Life Cycle.

By integrating the disciplines of architecture, investment management, and project implementation, these programs provide the foundation for sound IT management practices, end-to-end governance of IT capital assets, and the alignment of IT investments with an agency’s strategic goals. As architecture-driven IT investments are funded in the “Invest” phase, they move forward into the implementation phase where system development life cycle processes are followed and actual versus planned outputs, schedule, and operational performance expenditures are tracked utilizing performance-based management processes.

The IT investment must be included in the agency’s EA and Capital Planning and Investment Control (CPIC) process and mapped to and supporting the Federal Enterprise Architecture (FEA). The business case must demonstrate the relationship between the investment and the business, performance, data, services, application, and technology layers of the agency’s EA. Are this investment and its assets included in your agency’s target enterprise architecture through the underlying segment architecture?

OMB also offers detailed guidance regarding segment architecture requirements, which includes guidance also regarding the reporting of six digit codes corresponding to agency segment architectures in Exhibit 53, and, for limited cases determined by the Chief Architect, reporting an investment alignment with multiple segments.

Capital Programming
The Capital Programming Guide of OMB Circular A–11, provides guidance on the principles and techniques for effective capital programming. Section 9b of OMB Circular A–130 establishes additional requirements for enterprise architectures (EAs), planning and control of information systems and technology investments and performance management.

Agencies must develop and implement a capital programming process to develop their capital asset portfolio, and must:

  • Evaluate and select capital assets that will support core mission functions performed by the Federal Government, and which demonstrate projected returns on investment that are clearly equal to or better than alternative uses of available public resources. Specifically for IT, the investments should be informed by, and address gaps in an agency’s Segment Architecture and map to the agency’s strategic plan;
  • Initiate improvements to existing assets or acquisitions of new assets only when no alternative private sector or governmental source can more efficiently meet the need;
  • Implement IT reforms from the “25 Point Implementation Plan to Reform Federal Information Technology Management” such as adhering to modular development principles and the requirement to establish an Integrated Program Team prior to funding an IT investment;
  • Simplify or otherwise redesign work processes to reduce costs, improve effectiveness, and make maximum use of commercial services and off-the-shelf technology;
  • Reduce project risk by avoiding or isolating custom designed components, using components that can be fully tested or prototyped prior to full implementation or production, and ensuring involvement and support of users in the design and testing of the asset;
  • Structure major planning and acquisition into useful components with a narrow scope and brief duration, and that make adequate use of competition and appropriately allocate risk between Government and contractor. The Agency Head must approve or define the cost, schedule, and performance goals for major acquisitions, and the agency’s Chief Financial Officer must evaluate the proposed cost goals;
  • Ensure a continuous linkage with Federal, agency, and bureau EAs, demonstrating such consistency through alignment with the agency’s Segment Architecture, compliance with agency business requirements and standards, as well as identification of milestones, as defined in the agency’s EA transition strategy;
  • Institute performance measures and management processes monitoring and comparing actual performance to planned results. Agencies must use a performance-based acquisition management or earned value management system, based on the ANSI/EIA Standard 748-B, to obtain timely information regarding the progress of capital investments where appropriate, as defined in the Federal Acquisition Regulations (FAR). The system must also measure progress towards useful components in an independently verifiable basis, in terms of cost, capability of the investment to meet specified requirements, timeliness, and quality. Agencies are expected to achieve, on average, 90 percent of the cost, schedule and performance goals for major acquisitions. Through the Tech Stat process, agencies must review major acquisitions not achieving 90 percent of the goals to determine whether there is a continuing need and what corrective action, including termination, should be taken;
  • Ensure assets that are IT systems conform to the requirements of OMB Circular No. A–130, “Management of Federal Information Resources”; Ensure assets that are financial management systems conform to the requirements of OMB Circular No. A–127;
  • Conduct post-implementation or post-occupancy reviews of capital programming and acquisition processes and projects to validate estimated benefits and costs and document effective management practices, i.e., lessons learned, for broader use;
  • Establish oversight mechanisms requiring periodic review of operational capital assets to determine how mission requirements might have changed, and whether the asset continues to fulfill ongoing and anticipated mission requirements, deliver intended benefits to the agency and customers, and meet user requirements; and
    * Develop and maintain the following documents all of which may be requested by OMB and are subject to delivery within ten business days:
    * Investment level Alternative Analysis;
    * Investment level Acquisition Plan;
    * Earned Value Reports on large projects;
    * Integrated Program Team Charter;
    * Investment Charter;
    * Project Charters, as appropriate; and
    * Risk Management Plan


FY13 Guidance for Exhibit 300 A-B: GUIDANCE ON EXHIBIT 300—PLANNING, BUDGETING, ACQUISITION, AND MANAGEMENT OF INFORMATION TECHNOLOGY CAPITAL ASSETS” provides budget justification and reporting requirements for major IT investments.

FY13 Guidance for Exhibit 53 A-B: “GUIDANCE ON EXHIBIT 53—INFORMATION TECHNOLOGY AND E-GOVERNMENT” provides reporting requirements for an agency’s IT Investment Portfolio.


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