From legacy to leadership: How federal agencies are embracing cloud transformation

At Oracle Federal Forum 2025, a dynamic panel featuring industry and government leaders explored the challenges and strategies involved in modernizing federal HR systems. Moderated by Jake Berkvam, Senior Manager at Baker Tilly, the session offered insights on cloud transformation, standardization and the shifting federal technology landscape.

The panel featured two seasoned professionals - Steve Krauss, formerly of U.S. Office of Personnel Management (OPM), and Ken Plummer from Oracle, who brought unique perspectives shaped by decades of federal and enterprise technology experience.

Defining modernization in government

Plummer revealed how modernization means different things across federal organizations. “What modernization means to each organization is important… some admit they hadn’t upgraded in over 10 years” he commented, highlighting the reality that for some, modernization is as much about security as it is about efficiency. “For them, modernization meant addressing real exposure to security risks.” In others, modernization is tied to the ability to attract top talent, support mission agility or transition away from fragmented, legacy systems toward streamlined, end-to-end Software as a Service (SaaS) solutions.

Common challenges: Funding, fragmentation and federalization

Agencies face many difficulties in securing funding, prioritizing transformation projects and working with vendors to ensure software is configured to meet unique government standards.

Krauss’ team at OPM created an HR IT inventory across agencies, identifying 86 instances of 35 different software platforms, a clear indicator of the fragmentation at play. That inventory laid the groundwork for a new approach to shared data and process standards. These standards, now publicly available, serve as a foundation for federal requirements in modernization efforts.

Rethinking requirements

Both panelists emphasized the need for a shift in how government defines and gathers system requirements. Instead of compiling massive lists of desired features, they advocated for use case driven models – where agencies begin with their actual business needs and evaluate whether the software can meet those needs with standard functionality.

This use case driven approach helps avoid the trap of replicating outdated processes and fosters more agile, future-ready implementations.

Balancing standardization and innovation

The discussion turned to whether government-wide standardization might hinder innovation. The panelists agreed that while consolidation is necessary to reduce duplication and improve security, it is equally important to preserve room for mission-specific tailoring and competition among vendors. They envisioned a federal marketplace with a few core platforms capable of scaling across agencies, alongside opportunities for modular innovation and integration.

Investing in in-house capacity

A powerful takeaway from the session was the emphasis on fostering a learning culture. Strauss highlighted the need for agencies to develop internal talent capable of managing cloud systems, leading transformation initiatives and avoiding long-term dependency on vendors.

“Some agencies felt they were no longer in control of either their business or technology because they’d essentially trained their industry partners to run their operations” stated Krauss. With the rise of low-code and self-service tools, agencies now have more opportunities to take control of their technology journeys.

The challenge ahead

Strategy, people and the willingness to change are crucial to cloud transformation. Successful modernization depends on cross-sector collaboration, clarity in requirements, investment in internal capabilities and a shared commitment to delivering on the mission.

The technology is ready – the challenge now is leadership, execution and coordination.

Are you ready to take the lead in digital transformation for your agency?