Cloud Computing: DOD Needs to Improve Workforce Planning and Software Application Modernization


What the GAO found

In 2019, the Office of Management and Budget (OMB) updated its Federal Cloud Computing Strategy and established 14 key requirements for agencies to implement in three areas: security, procurement and labor. Cloud computing enables on-demand access to shared computing resources . The Department of Defense (DOD) has met 11 of the 14 OMB requirements, but there are gaps in its workforce planning (see table). These gaps include identifying future skills needed for cloud-based services and conducting regular assessments of customer experience and user needs. In addition, the DOD has not yet developed or executed communication plans to notify employees of changes related to the use of these services. Addressing these workforce areas is key to realizing the benefits of cloud computing.

Extent to which DOD guidance met OMB’s 14 key requirements for cloud computing as of April 2022

Requirement area

Fully Addressed

Partially processed

Not addressed






Of them

Of them


Legend: — = not applicable.

Source: GAO analysis of Department of Defense (DOD) documentation. | GAO-22-104070

In order to address OMB’s application streamlining requirement, DOD has partially implemented the first step noted in the Key Implementation Practices. The ministry has established a scope for its streamlining efforts and is working to formalize a governance group with the authority to set requirements and issue guidance. However, the lack of timelines established by the DOD for the completion of the remaining activities has impacted its efforts to progress on subsequent stages of best practices. Further, the DOD has not developed a long-term plan for streamlining implementation with measurable goals, milestones, and timelines. This is due to significant changes in its approach over the past 2 years; long delays in implementing enterprise-wide initiatives; and a lack of definition by the DOD regarding who is responsible for the success of streamlining activities. Without measurable goals, milestones, and timelines for streamlining efforts—and holding departmental components accountable for those efforts—DOD will be less likely to make measurable, consistent progress in streamlining or effectively reducing IT duplication.

In its FY19 guidance, the OMB began requiring agencies to use Technology Business Management (TBM) – a framework for increasing the granularity of IT spend data reported by agencies by aggregating related costs – as part of the annual budget submission. The DOD reported its budget data using TBM cost categories. However, the GAO has identified weaknesses in the completeness of DOD component cloud expenditure data. As a result, DOD cloud spending is likely underreported. This was partly due to non-specific ministry guidelines on the release of this data and the control processes needed to ensure the reliability of the data. Additionally, the Army and Air Force did not follow leading practices for implementing TBM. Until the Army and Air Force address TBM practices and the DOD Director of Information updates department guidelines on reporting TBM data and ensuring its reliability, the DOD will lack the complete information needed to make decisions about its IT investments.

Why GAO Did This Study

In fiscal year 2022, DOD plans to spend approximately $38.6 billion on unclassified IT investments. To drive cloud adoption, OMB is asking agencies to modernize, retire, or consolidate their software application portfolios, a process known as application rationalization. OMB also requires agencies to use TBM to categorize IT and cloud-related expenses.

GAO was asked to assess DOD’s reported use of cloud services. This report examines the extent to which (1) the DOD’s planned cloud strategy meets key requirements of the OMB Federal Cloud Strategy, (2) the department has plans to develop and implement an application rationalization process enterprise-wide, and (3) DOD uses TBM to track and report spend data for cloud services. To do this, GAO analyzed relevant DOD policies, guidelines, and other documents on cloud services and application rationalization. It also assessed the department’s cloud investment data for fiscal years 2021 and 2022 as well as department-wide guidance and training on TBM implementation. The GAO also interviewed DOD officials.


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