Based on this rate of savings, GAO estimates that agencies could have saved about $329 million if they had transitioned to Networx on time.
Specifically, in April 2010, GSA estimated that agencies could have saved 28.4 percent of their spending on FTS2001 by using Networx contracts instead. In addition to the extra transition costs, agencies may have paid more for similar services by staying on the FTS2001 contracts longer than planned. As a result of the delays, GSA's estimated cost to complete the transition increased by $66.4 million, 44 percent over the baseline estimate. For example, agencies tended to transition easier items first, to demonstrate progress, before they transitioned items that needed a long lead time such as data networks and international services. Weaknesses in agencies' project planning also contributed to the delays. GAO has identified skills gaps in the federal workforce as a government-wide high-risk area and highlighted the need for agencies to work with the Office of Personnel Management (OPM) to close them.
These issues were reported by the General Services Administration (GSA) to have been compounded by a decline in contracting and technical expertise within the agencies. In particular, the complexity of the acquisition process was related to duplicative contract vehicles, the large number of service options, and changes related to the process for ensuring fair competition among service providers, among others. Complex acquisition processes and weaknesses in project planning contributed to the delays experienced on the Networx transition, resulting in cost increases and missed savings.
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