The Costly Cycle of Reinvention

Federal agencies waste billions annually on custom application development when proven, existing solutions would suffice. Despite tremendous technological advances, many agencies remain trapped in a cycle of costly, time-consuming custom development projects that frequently underdeliver or fail entirely.

The numbers tell a sobering story. According to the Government Accountability Office, over 75% of the federal government’s $90 billion+ IT budget is spent on maintaining aging systems or building custom replacements. Of new development projects, more than half experience significant cost overruns, timeline delays, or fail to deliver promised functionality.

The Allure of Custom Development

Why does this cycle persist? Many government contractors often have powerful incentives to recommend “from-scratch” development, even when existing platforms could be configured to meet requirements at a fraction of the cost and time. For contractors, custom development means larger contracts, more billable hours, and long-term maintenance agreements. Plus, custom development often requires staff augmentation from those same contractors to support the project long term.

There’s also the psychological appeal of “new and custom” solutions. Agency leaders often face pressure to demonstrate innovation through visible new systems rather than through process improvements or platform enhancements. This “shiny object syndrome” leads to redundant systems that ultimately create more technical debt.

The Hidden Costs

Beyond the obvious budget implications, custom development introduces:

• Extended timelines that delay mission-critical capabilities
• Increased security vulnerabilities requiring time-consuming Authority to Operate (ATO) processes
• Higher training and change management costs
• Limited interoperability with other agency systems
• Ongoing maintenance burden that diverts resources from innovation

Breaking the Cycle

Some federal agencies have recognized this trap and are charting a different course. The Department of Veterans Affairs’ Digital Transformation Center (DTC), which we have worked with for over 10 years, pioneered an approach that prioritizes low-code/no-code (LC/NC) platforms and pre-approved solutions, enabling them to deliver digital solutions in weeks rather than years while controlling costs.

In our next article, we’ll explore how the VA DTC fundamentally changed its approach to digital transformation, creating a model that other agencies would be wise to follow.