Information Technology: HUD Can Take Additional Actions to Improve Its Governance
Highlights
What GAO Found
The Department of Housing and Urban Development (HUD) has partially established elements of key practices for effective information technology (IT) governance, as identified by GAO's IT investment management guide. However, several shortcomings remain:
Investment boards, policies, and procedures were not fully established: HUD chartered four review boards to manage the department's IT investments; however, the executive-level board, which is to be responsible for overall definition and implementation of the investment management process, has never met. Instead, the department's Deputy Secretary makes decisions about which investments to fund. The lack of an operational executive-level board has affected HUD's other active investment boards, which are operating without criteria the executive-level board was to have established for evaluating proposed investments. In addition, HUD has not yet developed all of the policies that it has identified as needed to support its IT management framework. Specifically, the department has not set a schedule for developing policies for IT investment performance, privacy, and risk management. Office of the Chief Information Officer (CIO) officials explained that operating without an executive-level board represents the preferred investment management approach of HUD's Secretary and Deputy Secretary.
Process for selecting investments lacks key elements: HUD has developed elements of a process for selecting investments based on defined criteria; however, it has not fully defined and implemented practices for identifying, evaluating, and prioritizing proposed IT projects for funding, as recommended by GAO's IT investment management guide. CIO officials acknowledged that they have not yet fully developed a standard and well-documented process and attributed weaknesses to a variety of factors, including changes in leadership, priorities, and approaches.
Process for overseeing investments has not been fully developed: The department has not consistently compared the performance of projects to pre-defined expectations, established thresholds to trigger remedial action for underperforming investments, or reviewed projects after implementation to compare actual investment results with decision makers' expectations. These weaknesses were attributed by CIO officials to, among other things, the lack of a consistent, enterprise-wide way to collect and compare actual data with estimates.
Until effective governance practices are institutionalized, there is risk that HUD's investments in IT may not reflect department-wide goals and priorities or effectively support the department's mission.
While HUD has reported governance-related cost savings and operational efficiencies, the data to support such reports were not always accurate, consistent, or substantiated. This is due, in part, to the lack of a department-wide approach, as called for in Office of Management and Budget guidance, to identify and collect cost-savings information. Thus, it is unclear to what extent HUD has realized savings or operational efficiencies from its IT governance.
Why GAO Did This Study
HUD relies on IT to deliver services and manage programs in support of its mission of strengthening communities and ensuring access to affordable housing. However, the department has experienced shortcomings in its IT management capability and limitations in the systems supporting its mission.
A Senate report accompanying HUD's fiscal year 2012 appropriation mandated GAO to evaluate, among other things, the department's institutionalization of IT governance. In response, GAO reported on HUD's IT project management in June 2013.
GAO's objectives for this second review were to determine (1) the extent to which HUD implemented key IT governance practices, including effective cost estimation, and (2) what, if any, cost savings or operational efficiencies HUD has reported achieving as a result of its IT governance practices. To accomplish this, GAO compared HUD's approach to IT governance with best practices and the department's policies and procedures. GAO also analyzed reported cost savings and operational efficiencies, along with any available supporting documentation.
Recommendations
GAO recommends that HUD ensure that its investment review boards operate as intended and complete and update associated policies; fully establish processes including key elements for selecting and overseeing investments; and fully establish a process for identifying, collecting, and reporting data about cost savings and efficiencies. HUD agreed with GAO's recommendations.
Recommendations for Executive Action
| Agency Affected | Recommendation | Status |
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| Department of Housing and Urban Development | To ensure that HUD fully implements and sustains effective IT governance practices, the Secretary of Housing and Urban Development should direct the Deputy Secretary and the department's Chief Information Officer to place a high priority and ensure that the executive-level investment review board meets as outlined in its charter, documents criteria for use by the other boards, and distributes its decisions to appropriate stakeholders. |
HUD agreed with this recommendation. In April 2019, HUD reported that it was updating its governance process and charters and stated an intent to ensure that executive-level decision making was clearly defined, including when a decision needs to be made, at what level that decision needs to be made, what criteria should be used, and how that decision would be communicated. HUD updated its governance policy in February 2021. In March 2021, the department reported plans to develop an executive-level investment review board. In February 2022, HUD reported that it had established a new executive-level Investment Review Board. In August 2022, HUD's new principal investment review board met. In that meeting, the Deputy Secretary discussed the importance the changes HUD had made to its governance process and their impact on HUD IT. Documentation from that meeting showed that the board had also established criteria used by lower boards for investment decision-making. By chartering the new executive-level board and ensuring it meets as intended, HUD should be better positioned to ensure that the department fully implements and sustains effective IT governance practices.
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| Department of Housing and Urban Development | To ensure that HUD fully implements and sustains effective IT governance practices, the Secretary of Housing and Urban Development should direct the Deputy Secretary and the department's Chief Information Officer to place a high priority and fully establish and maintain a complete set of governance policies, establish time frames for establishing policies planned but not yet developed, and update key governance documents to reflect changes made to established practices. |
The department has taken steps to address this recommendation. In 2015, HUD updated its Project Planning and Management policy. Since that time, the department has developed additional policies (e.g., IT risk management policy), revised policies for the IT management framework and Agile development, and reported that it reviewed OCIO's existing policies in September 2018. In October 2018, HUD provided a copy of the draft of the revisions to its IT Management Framework (dated February 2018) and OCIO reported plans to continue developing and maintaining IT policies for each of the framework's elements and to review policies for currency annually on the anniversary date of the policy. As of March 2019, HUD reported that a central repository had been developed to store, track and monitor policy reviews. Since that time, the department has provided evidence that it is reviewing and updating policies. For example, in updating its IT governance policy in February 2021, HUD removed references to enterprise architecture segments to reflect HUD's change to program-based governance. Establishing practices to review and update policies should better position HUD to fully implement and sustain effective governance practices.
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| Department of Housing and Urban Development | To ensure that HUD fully implements and sustains effective IT governance practices, the Secretary of Housing and Urban Development should direct the Deputy Secretary and the department's Chief Information Officer to place a high priority and fully establish an IT investment selection process that includes (1) articulating how reviews of project proposals are to be conducted; (2) planning how data (including cost estimates) are to be developed and verified and validated; (3) establishing criteria for how cost, schedule, and project risk are to be analyzed; (4) developing procedures for how proposed projects are to be compared to one another in terms of investment size (cost), project longevity (schedule), technical difficulty, project risk, and cost-benefit analysis; and (5) ensuring that final selection decisions made by senior decision makers and governance boards are supported by analysis, consider predefined quantitative measures, and are consistently documented. |
HUD agreed with this recommendation. In 2015, HUD reported that it had begun using a new tool to support its IT selection process. In May 2018, the department provided a demonstration of its HUD PLUS tool, including how it had used the tool to automate its selection process. The officials demonstrated how the tool was being used to review proposed projects. They reported that segment sponsors were responsible for validating data submitted. The officials demonstrated how the tool supported analysis of investment costs, schedule, and risk. They also demonstrated how the tool helped the Office of the Chief Information Officer compare investments based on cost and showed how decision makers accessed information and could perform analysis for all projects in the system. In February 2022, HUD reported that OCIO was working closely with agency leadership to fully implement all aspects of its revised governance policy and establish a new framework for budget formulation. In its most recent initiative, HUD's Customer Care Committee (CCC) established criteria for governance boards to use to assess IT investments for selection and funding. HUD also provided evidence that the Investment Review Subcommittee aligned the proposed IT investments for FY2024 in tiers and recommended that slate of investments to the CCC. HUD also provided evidence that the CCC met to vote upon the investments to be selected. HUD also provided evidence that, in August 2022, the executive board reviewed the analysis of the proposed investments and recommended changes. By taking these actions, HUD has improved and institutionalized a more consistent selection process that is supported by criteria and analysis. By doing so, the department should be better positioned to select IT investments to meet its goals and business needs.
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| Department of Housing and Urban Development | To ensure that HUD fully implements and sustains effective IT governance practices, the Secretary of Housing and Urban Development should direct the Deputy Secretary and the department's Chief Information Officer to place a high priority and fully establish a well-defined process that incorporates key practices for overseeing investments, including (1) monitoring actual project performance against expected outcomes for project cost, schedule, benefit, and risk; (2) establishing and documenting cost-, schedule-, and performance-based thresholds for triggering remedial actions or elevating project review to higher-level investment boards; and (3) conducting post-implementation reviews to evaluate results of projects after they are completed. |
As of June 2018, we determined that the department had made significant progress in maturing its IT investment oversight practices and that the steps it had taken addressed this recommendation successfully. In April 2016, HUD provided evidence of actions taken toward developing new processes for investment oversight practices. Specifically, the department created processes for conducting project health assessments and weekly project management meetings intended to monitor, among other things, actual performance against expected outcomes, and to establish thresholds for triggering remedial actions or elevating projects for additional review. HUD also provided evidence that one investment had been halted based on a TechStat review with the Office of Management and Budget and explained that other internal reviews of projects encountering problems had been executed. In May 2018, HUD officials provide a demonstration of how the department is using HUD PLUS as part of its more mature oversight approach. As of June 2018, the department had provided evidence that these new processes were fully established and institutionalized.
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| Department of Housing and Urban Development |
Priority Rec.
To establish an enterprise-wide view of cost savings and operational efficiencies generated by investments and governance processes, the Secretary of Housing and Urban Development should direct the Deputy Secretary and Chief Information Officer to place a higher priority on identifying governance-related cost savings and efficiencies and establish and institutionalize a process for identifying and tracking comprehensive, high-quality data on savings and efficiencies resulting from IT investments and the IT governance process. |
The department has taken steps to address this recommendation. Specifically, in April 2016, HUD provided examples of cost savings that the department had identified by "scrubbing" existing contracts during the budget formulation process, along with copies of a template that it designed and used to help identify such savings. In May 2018, department officials provided a demonstration of the HUD PLUS tool, including screens staff could use to report cost savings and avoidances related to specific projects--although they reported that HUD was not yet using that functionality. In April 2019, OCIO reported that HUD was updating its governance process and charters to ensure that executive-level decision making will be clearly defined. OCIO also reported an intent to implement Technology Business Management (TBM) to, among other things, improve and expand the tracking of investments. HUD expects these two efforts to facilitate better tracking of the savings and efficiencies resulting from IT decisions. As of March 2021, HUD was working to finalize a cost savings process planned to start in April 2021. The department was also continuing to develop a TBM implementation plan. In February 2022, HUD reported plans to build on the governance process to establish efficiency as a HUD IT priority and to collect quarterly data on IT-related cost-savings. In November 2022, HUD reported that its governance boards had begun considering whether IT investments were designed to deliver operational value to programs or the agency as a whole. Adding such criteria to the IT selection process provides a starting point for considering the savings or efficiencies investments may generate. In February 2024, HUD officials reported they planned to improve the business case development and review process to quantify planned benefits and cost savings, operational efficiencies, or both, for proposed and ongoing projects. Specifically, HUD planned to leverage previous efforts to implement Technology Business Management and benchmark IT spending to develop processes to evaluate actual cost savings and operational efficiencies and establish a standard methodology to estimate IT costs. However, as of March 2024, the agency had not yet completed its planned work to address this recommendation.
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