Creative IT Funding

Three significant trends have emerged among federal-government agencies over the past several years.

First, government contracting has become more performance-based, placing higher expectations on solution providers.

Second, offering IT-infrastructure management as a service has been embraced as sound policy by all levels of government through managed services and utility computing.

Third, capital funding for IT infrastructure is under intense pressure as programs and agencies compete for that funding based on ROI.

The impact of those trends has forced government IT executives to reconsider their strategies for large IT initiatives and to look at creative ways to implement, fund and sustain long-term, complex deployments.

And if government agencies are to fulfill their most important mission--to protect and serve--they need to optimize all available funding to pay for their technology infrastructures without diluting their core missions.

Proactive government IT executives have come to embrace a lifecycle approach to managing their infrastructures. The Office of Management and Budget has promoted this trend by encouraging the outsourcing of IT-asset ownership to industry, and many astute systems integrators have begun to incorporate IT costs as a component of their overall offerings.

Technology Lifecycle Management (TLM), a concept developed by GTSI Financial Services, is a complete business solution that systems integrators should consider offering to their customers and that agencies will value. In its entirety, TLM can be a unique management and budgeting tool to address government agencies' capital budget constraints, provide flexibility and responsiveness, and reduce program risk.

Here are the five steps of TLM:

1. Assess an agency's needs with an eye toward migrating the agency's current technology to advanced solutions.

2. Acquire technology on the government's behalf.

3. Integrate and manage the technology using a full range of professional services; structure warranty and maintenance support in response to changing requirements.

4. Refresh the technology in an orderly way.

5. Recover or dispose of the assets in a planned, efficient manner to protect the data.

Public-sector VARs should start looking at themselves as TLM providers, acting as service subcontractors for the broader integrator community. This unique approach allows integrators to focus resources--time, staff and capital--on building value for their government customers. The financial strategy shifts funding from capital to operating budgets, often accelerating deployment and business benefits.

TLM enables systems integrators to be responsive to their customers. By shifting ownership of IT assets under a TLM service subcontract, new requirements can be fulfilled both quickly and flexibly. Earned Value Management contracts that are performance-based are ideally suited for the TLM approach, and they significantly increase integrators' value to their customers.

GTSI, through its Professional Services unit and Financial Services subsidiary, spent several years developing and maturing TLM as an infrastructure-management methodology. Known in commercial settings as "IT as a Service," the idea is a logical next step in contracting. Managed-service providers have begun to include TLM-like services in their offerings, thereby merging service and infrastructure costs into one billable operating expense.

Regardless of the contracting method, TLM should be embraced by government and industry as the solution to proactively manage IT infrastructure, optimize ROI and help agencies be more responsive to changing demands.

Jack Helmly is president of GTSI Financial Services, a subsidiary of GTSI, which has provided more than $300 million in financing to systems integrators and government agencies.