GAO Cost Estimate Assessment Webinar

The federal government plans to spend at least $75 billion on IT investments in fiscal year 2012. The size of this investment highlights the importance of reliably estimating the costs of IT acquisitions. A reliable cost estimate is critical to the success of any IT program, providing the basis for informed decision making, realistic budget formulation, and meaningful progress measurement. Without the ability to generate such estimates, programs are at risk of experiencing cost overruns, missed deadlines, and performance shortfalls.

 In this regard, we will discuss our recent report entitled Information Technology Cost Estimation: Agencies Need To Address Significant Weaknesses in Policies and Practices (GAO-12-629). In particular, we will discuss why GAO did the study, what the objectives were, and briefly reflect on the importance of cost estimating in establishing budgets. We will highlight the key components of an effective cost estimating policy, our assessment of eight selected federal agencies’ policies, and common areas of weakness across the agencies that we assessed. Lastly, we will discuss the characteristics of a reliable cost estimate, our assessment of the cost estimates for 16 IT investments at the eight agencies, and common areas of weakness across the programs that we reviewed.