For years, the government has been claiming it wants to move towards e-government, but in actuality it has done very little. However, some analysts are saying that 2002 could be a watershed year for putting such projects in motion. They point out that the government is making a renewed push to streamline its operations and highlight the fact that the Bush Administration has asked for $100 million over three years to start e-government projects. Further cementing this opinion is the fact that the Office of Management and Budget announced in October the creation of 23 e-government initiatives to improve the government's dealings with itself, citizens and businesses. "The government is one of the few areas with money this year," said Morgan Stanley analyst Charles Phillips. "Everybody is trying to pitch to them."

The information technology sector, in particular, stands to benefit a great deal. In fact, several tech giants have recently announced lucrative government contracts. Spending $45 billion a year, the federal government is IT's biggest customer worldwide.

Government's enthusiasm aside, there are still significant hurdles to clear before e-government can be significantly implemented. The insular culture of government agencies may hinder adherence to the same technological standards. Another obstacle to the rapid adoption of e-government is Washington's white-paper first, act-later culture. Kevin Fitzgerald, senior vice president of Oracle's government, education and health care unit, has speculated that the toughest challenge may be automating processes from end to end with outdated systems that could be up to 20 years old. "It's a series of contrasts," Fitzgerald says. "The government is maintaining 20-year old databases while rolling out new technology." Considering the government's Johnny-come-lately approach to new technology, Prudential Securities economist James Lucier points out that our government should soon be adopting XML and CRM software. Add to this the need to become more efficient because of budgetary constraints and concerns about cybersecurity, e-government seems a real near-term possibility.

According to Anne Altman, managing director for IBM's federal unit, the key to making e-government happen is standards. Without standards, agencies won't be able to communicate electronically. Of course, getting everyone on the same page comes with a price. Altman predicts that if e-government does become a reality, its IT spending will eventually level off and dip back down after all the initial investments have been made. Venturing to indicate when e-government signs may become evident, Morgan Stanley analyst Charles Phillips states, "Government has clearly identified its needs and is more likely than not to spend more aggressively. It's already helping some companies' quarters, but you're likely to see the government efforts paying off in the September quarter of 2002." Here's to the New Year.

Source: An E-Government Pill for the Tech Sector
Larry Dignan
CNET, Dec. 17, 2001
http://news.cnet.com/news/0-1007-200-8182655.html?tag=tp_pr