Originally Broadcast February 23, 2008
Announcer: Welcome to The Business of Government Hour. A conversation about management with a government executive who is changing the way government does business. The Business of Government Hour is produced by The IBM Center for the Business of Government, which was created in 1998 to encourage discussion and research into new approaches to improving government effectiveness. You can find out more about this center by visiting us on the web at businessofgovernment.org.
And now, The Business of Government Hour.
Mr. Morales: Good morning, I am Albert Morales your host, and managing partner of The IBM center for The Business of Government.
First called "the people's department," by Abraham Lincoln, the United States Department of Agriculture is a diverse and complex organization. From enhancing economic opportunities for agricultural producers to protecting the nation's food supply, to improving nutrition and health, the USDA supports programs that touch the lives of all Americans, everyday.
With us this morning, to discuss how USDA's financial management and information technology strategies support the Department's program mission is our special guest, Chuck Christopherson, chief financial officer and chief information officer at the USDA.
Good morning, Chuck.
Mr. Christopherson: Good morning.
Mr. Morales: Also joining us in our conversation is Mike Wasson, director in IBM's federal civilian industry practice.
Good morning Mike.
Mr. Wasson: Good Morning Al and good morning Chuck. And thank you for joining us today.
Mr. Morales: Chuck, I always like to ground our listeners with some facts around our subject, in this case, the USDA. Could you start by providing us a sense of the history and mission of the U. S. Department of Agriculture?
Mr. Christopherson: Yes. Actually USDA is an incredibly fascinating place, you know, we have a large myriad of programs that handle both the conservation element of the United States when you like at forest service and we look at the -- our Natural Resource and Conservations Service, when it comes to more the farm entities and items such as streambeds and things like that.
On the opposite aspect, we also have Food and Nutrition Services that handles the Food Stamp Program, the food pyramid and research around the food pyramid. We do a vast amount of research in the Department, which is incredibly fascinating as well. We have an agricultural research farm that has developed out everything. We've had at one time up to 80-pound turkeys when, you know, turkey meat was a big in-thing with the American public as it was so lean to, you know, turkeys that are 20 pounds or 15 pounds for a normal family, at Thanksgiving.
We have at the research center as well, you know, our ability to have, you know, a great food supply in our grocery stores is due to a lot of work that they do there. We grow more food per acre than we ever did before. We use less fertilizers than we ever did before. We also have basically the venture arm of the government when it comes to rural development, and investing in rural America, everything from water treatment plants to the infrastructure for telecommunications.
And what's happened is it's actually become a great place for technology companies to invest in for, you know, helped us call centers and things like that. Items that used to go overseas are now is trying to come back. There is just a diverse mix of programs at USDA that we manage, and that doesn't even cover the inspection services that most people associate us with.
So we have a vast mission, and as you know, a myriad of programs associated with it. It adds a lot of complexity to the organization, at the same time there is refining over the last couple of years that there is a lot of synergies that we can capitalize off of and actually reduce some of our costs.
Mr. Wasson: So Chuck, with such diversity of mission could you provide us some details on how the USDA is organized, sense of the size of the budget, number of fulltime employees, and perhaps the geographic footprint of the department?
Mr. Christopherson: Yeah, that is actually fairly easy. We deal on basically a hundreds -- so, we have got 100,000 employees when it comes to disbursement it's about a $100 billion a year 00 a very sizeable number and makes us, you know, a very large entity inside the United States, one of the largest inside the United States -- probably among if I, you know, take my private sector background we'd be among the top 10 corporations in the United States, if we were to look at it that way.
The layout, like, I said before, you know, normally looks at research versus rural development versus the farm programs and some of our marketing programs. It is highly complex in the way that we have to manage and operate. But at the same point it also has simplistic structure to where we have, you know, the secretary, a deputy secretary operating supports staff to support out the missions, to layout goals and visions and expectations. So it's highly complex, but we are operating in a very simplistic model.
Mr. Wasson: Well, Chuck, now that you've provided us with a sense of the larger origination perhaps, you could tell us more about your area and dual role within USDA?
What are your specific responsibilities and duties as both as chief financial officer and chief information officer? Could you tell us about the areas on your purview, how your areas is organized, the size of your staff and budget and how does it support the mission of the Department?
Mr. Christopherson: When it comes to my budget, you know, that's actually is a tough thing to actually look at. I have about 3,000 employees that report out to me in my structure, a fairly large organization.
We basically have three separate segments. We basically have finance and we have Shared Services both on the finance side and on the information technology side, and then we have basically the pure IT side.
So if I take the finance side, I'd have responsibilities for kind of the Sarbanes-Oxley or government. So the internal controls, A-123 -- certain information in reporting that we have to do, so the performance and accountability report that goes to Congress every year at the end of the calendar year, after the fiscal year is closed and to basically planning and continuity of operations as well when it comes to financial management, financial systems all rest on that organization and the accumulation of information for disbursements and all that -- cutting checks, all that stuff would come out of that area.
We have the National Finance Center; about a third of the federal civilian government is paid through them. Located in New Orleans, as you know, we went through some issues with Katrina and yet, you know, it was flawless. Then I switch over my CIO side and I have data center operations which are basically Shared Service operations there. And then I have the traditional IT when it comes to, you know, the planning of IT enterprise-wide architectural things such as E-Authentication, we have HSPD-12 moving in which is credentialing to radio frequency chip in peoples' IDs, so we can actually have a more secured network.
Anyway, there is a long list of items including the E-Government Initiatives, it's like if you -- its somewhat of an oversight of our organization in the way that we operate and the way that we are structured.
Mr. Morales: Well, thank you. And regarding your responsibilities and duties, what are the top three challenges that you face in your position, and how have you addressed those challenges?
Mr. Christopherson: I think the top challenges right now are -- at USDA our back office can't change fast enough. We're on 1980s and 1970s infrastructure when it comes to information technology in several of our mission areas. Its not -- it's all technology anymore, it is no longer, you know, fully serviced by vendors and people like that. I have between -- the Farm Service Agency I've about 14 million line of COBOL code. Same thing with NFC, I've about 14 million lines of COBOL code. It's becoming more difficult to find those programmers.
And that leads into the second big issue, which is the human capital element. Federal government is starting to get hit by the vast retirements that have been basically prophesied for a number of years. And we are now to the point that we're starting to see that where the SES ranks are really getting hit hard. And so -- that's our second big issue is continuously planning for the human capital element as people retire out.
Then the third element is; how do we manage all this change? As you can tell there is a lot of influx in the environment right now. You know, the USSP more comparative in world markets means that you know, as a government we have to be more flexible, we have to be -- operate a little thinner and yet we have to have information and technology that supports out, you know the change in environment that we have. So now we are becoming thinner but yet we have higher responsibilities as well.
You're seeing a lot of that change come into the environment, yet on top of that human capital, the change in IT infrastructure that we have, the whole change management aspect is something that is not necessarily easy to manage and is probably the third area.
Mr. Wasson: And Chuck, you came to the USDA a couple of years back after a career in consulting in the private sector. Could you tell us a little bit about your career path and how you get started?
Mr. Christopherson: Yeah, I actually, you know, I gradated out of -- out of university and my first stop was in the hospitality industry and I quickly found that they needed people to come in and clean-up books, and address audit issues and things like that.
It was kind of the time and the season in the hospitality industry, they were growing very quickly, and so in about a year I found that I was the -- basically the hotel controller over -- I mean, 850-room hotels, it's the largest hotel that the organization had, I learned an incredible amount.
I had an opportunity over at a $1 billion telecom company that is part of a very large utility. We had, you know, companies that were, you know, very -tier companies. That's where I left and I started into consulting at first on how do you, basically make it more dynamic when it comes to IT and infrastructure? How does the merge between technology and finance come together?
After I did that for basically a couple of years, I ended up accepting a position as a CFO in a company that was in a turnaround and we very quickly were able to turn it around and take it to the next level. I was a CFO, I moved into being basically the COO and the CFO at the time -- so I did operations and finance in the company.
I later moved on to Fortune 500 where I had as a group vice-president over operations and finance and then later, you know, at the invitation of the president, to come up and serve the country. And it's an incredible honor to take a position like this and to serve the country. So --
Mr. Morales: That's a great story. So Chuck, if you boil that down, how have these experiences prepared you for your current leadership role or roles at the USDA and is there a particular management lesson that you've learnt over the years that you've brought over to the USDA in these roles?
Mr. Christopherson: Yeah, there is -- there is actually a number of lessons that I've learnt over the years, as I came to USDA, you know, I found that people actually read every single word inside of a memo in the federal government.
Mr. Christopherson: And you know, it's -- and there is nothing wrong with that, you realize that you have people that their job is to figure out what "is" really means and what "of" really means, what "and" really means in legislation. They do this for a living because it makes a big difference. It can be a difference between whether or not you can actually operate a program or not operate a program.
When I came to change management technology and those type items, you know, blending finance knowledge with information technology happened before to having the joint role. We had subcommittees that we send up that were basically multitalented, multitasked committees therefore like the Farm Service Programs where we had some IT issues and we are looking at how do we bring in a new farm payment system, that team -- you really had to have a combination between somebody that was on -- that was a program management official that understands the program, yet have somebody that understands finance and technology, internal controls, how you move processes across the organization, financial processes. At the same your really have to have somebody who had technology involved in it.
And so all these talents basically came together to form this team. And then you know, we provided oversight when it came to senior management in how do we eliminate barriers? And so it very much defined, you know, the group that had the responsibility and really how we had to take all this talent and put it together to those that could eliminate barriers and to push things forward and so -- you know, these models have been striving to come together, they have been, you know, a great model, but it has its stake and you know realized that model isn't traditional for government.
So, you know, there is just some really strong and really good compliments that have happened through this process over the last two-and-half years.
Mr. Morales: That's great. So how is the USDA integrating budget and performance information?
We will ask Chuck Christopherson, chief financial officer and chief information officer at the USDA, to share with us when the conversation about management continues, on The Business of Government Hour.
Mr. Morales: Welcome back to The Business of Government Hour. I'm your host Albert Morales and this morning's conversation is with Chuck Christopherson, chief financial officer and chief information officer at the USDA.
Also joining us in our conversation from IBM is Mike Wasson.
Chuck, in the last OMB scorecard nearly half of the federal agencies received either a "yellow" or a "red" rating in improving their financial performance. So tell me what has been your organization's secret sauce if you will, in getting to a "green" rating in progress.
And second, could you tell us from your perspective, why this is such a challenging area for most federal agencies?
Mr. Christopherson: Yeah, federal management is tough, there is -- there is lot of things that actually -- basically you have to manage and have work together. You know, obviously one of this is technology and finance.
You know, as you start to, you know, coordinate between at the program level, the technology level and the finance level, you start to see some very good cohesion across the board. A lot of it does come back to the people and the talent that you have in place, so, you know, this is something that we've laid out as a goal over and over again to be "green" in progress. We'd actually like to be "green" in the -- in the primary rating as well.
Right now we are "red. " That goes back to our age of our systems, you know, until we get some systems changed out, it is going to be tough for us to be, you know, off that "red" although OMB has made some changes where it looks like we maybe have to actually get to yellow.
Financial performance, as citizens believe and they should belief that their government is doing the right thing, that they are calculating right, that the finances of government are going forward, that, you know, it's tough, and it's supposed to be tough, and it needs to be tough.
Mr. Morales: That's a very -- very high standard.
Now your department as had a long history of achieving an unqualified opinion in your principle financial statements, which clearly demonstrates a pattern of financial responsibility and accountability. This year, however, I understand that the USDA reported a qualified opinion.
Now, as background there are three types of opinions: Unqualified, qualified and disclaimer. Could you just give us a short explanation of these three types of opinions, but more importantly what change that resulted in this qualified opinion?
Mr. Christopherson: Yeah, an unqualified opinion means that basically that an independent auditor can come in, look at your financial information and basically conclude that either some adjustments need to be made and you book those adjustments -- if your both in agreement or that everything is 100 percent fine and by the time you are done and you get to the end your financial statements then are -- at least, you know, reasonably reported. You may have some very small immaterial items such as, you know, you may have the couple of dollars or something like that that will flow into another calendar year, but they're are actually reasonably stated, you know, across the board.
A qualified opinion means that normally there are some constrain where they can't get to that full unqualified opinions. So, the auditors can actually go through in state and say, hey, we can't get there because of "X. "
And sometimes it's been because of, you know, we have seen that other entities where its financial system implementation has caused some problem, a new program or change in program or something like that. And you know it just didn't go as smooth as people thought. And so, you know, a qualified opinion basically says, I have an area that I can't get to the safe point if I'm the external auditor who, you know, analyzing this.
And then you have the basically a disclaimer that says, I'm to the point that there is nothing ambiguity information and it's a sizeable enough that I can't get to the point where I can actually contain it all the way to actually qualify it.
And so those are three different levels, but we did have a qualified opinion this year coming from you know eight years of unqualified opinion to a qualified opinion. It was tough, very tough for my team, and tough for me as well. It was, you know, a myriad of events that actually caused this, and they were all basically -- the idea is that we were -- making some change that was good.
This last year, our rural development operation went through their credit reform models or their credit models that actually calculate out and say things like, you know, how much are we supposed to be supporting under financial statements and show to the American people that we subside the rural loans?
]How much shall we show for rural loans, these are in rural areas and are in areas you know making basically investments into groups that, you know, for water treatment plant for a very small town. And so, you know, those are it's -- you know large amounts of money but yet somebody has to do it. So it goes back to the American government.
You know the qualified opinion came back to our Single-Family Housing what has traditionally been, you know, a very stagnant model over the years. So, there wasn't a lot of change in the model -- suddenly had a great amount of change. And so we also had, you know, an auditor that had to come up to the speed very quickly on this, and you know, I can't say this is the auditor's fault because it was basically it's a whole area that was a perfect storm in this case.
So we are now at the point that we are going through those models and you know, working with the, you know, the audit firm to make sure that they feel safe going to the next audit cycle so we don't have this issue again. It is very correctable and we should be at an unqualified opinion this next year.
Mr. Wasson: Great. Well, budget and performance integration lies at the heart of ensuring both strategic allocation and efficient use of funds. Could you tell us about your department's effort in budgeting performance integration and how has the organization expanded the use of financial data to inform its management decision-making process?
Mr. Christopherson: Well, I actually -- like to move this to as how we use data, whether it's financial data or whether it's data that is collected on information, on various aspects of our program.
I'm not sure that we ought to split those two apart. When it comes to the management and the performance element of our programs, it's key that we manage all the elements. So for, say like Food and Nutrition -- it maybe managing and looking at as key indictors not only what we've -- what we've paid out, but also, you know, the number of people that we pay to. There is number of elements that you always want to look at, and finance is a compliment to those other elements as well. You really don't want to split the two because it really doesn't give you the full indicators.
And so any way, as a government, you know, over this last probably two years -- two-and-half-years that I have been here, I'll tell you, I've really seen a lot of maturity that has -- that has come out of this. What's happened -- you know, before it was -- we were learning and we were base-lining. We're now to the point where we're really starting to get mature in the way that we lay these out, and the way that we actually discuss them, and calculate them, and how we portray them out to the American public. So we are actually at a very good point right now.
The president has actually laid out that we actually have a person inside the Department that's a career individual that is fully responsible for this going forward. So it's important that we measure these programs and we know which ones are doing well, and which ones aren't.
Inside the Department we've made substantial corrections in order to better serve the American public. You know, we wouldn't have made those corrections necessarily, unless we start to measure.
Mr. Morales: Well, USDA has been allowed to become a shared services provider under the Office of Management and Budgets -- Financial Management line of Business also known as FMLoB initiative.
Would you tell us more about USDA's financial management modernization initiative? Well, you know, how key is it to your financial management's modernization strategy in meeting future business needs and to what extent does it represent an opportunity for moving OMB's FMLoB forward?
Mr. Christopherson: Let me kind of clarify this on the Financial Management Line of Business. I'm actually very much for -- inside the federal government, you know, the fewer entities that manage finance the better.
And USDA we actually did go out and look at the internal groups to say, you know, on the FMLoB, the Financial Management Line of Business, what we found is that USDA is -- with Forest Service, we have just so many transactions that -- as we looked at each one of the Financial Management line of Business -- hat suddenly we were twice as size as all of them in we looked at, if we could split it apart and have, you know, two different FMLoB units, look it at that way.
When it comes to financial management or the ERP systems they are just so strategic to the way that you operate your department, realize right now USDA runs on nine different general ledger systems. We're talking about trying to coordinate a lot of information -- it because it is very expensive for us to do that.
Now suddenly as we move to one system for the Enterprise, now suddenly we have one data repository, on top of that we can then start adding other systems on top of it that we already have in-house, things like content management, things like you know, E-authentications electronic approvals.
Try to put these together and then you are looking across and saying, okay, with grants. Grants uses all those elements and now we can take grants and actually electronically, sent grants throughout USDA, right now we have some people that use some electronic processes, but most of them start off with a paper process.
We can now get to the point where we are fully electronic in the process in the way that we operate grants. When it comes to loans in the future, we'll be -- able to be fully electronic when it comes to loans. We are, you know, trying to understand how we can get to a fully electronic loan application so that you know, meet legislative requirements but actually make it so that people can fill out all the loan application online, actually send it in, like you would with like e-Loans or somebody in private sector and then from there it have a fully electronic all the way through USDA through the approval process
It's wonderful as we look at it, but you know, it comes back to you know, the same process as systems for grants, also work for loans, also start to look at insurance, as you look at transaction process in the financial elements. So paying invoices things like that, you know, anyway you are starting to understand how the complexity starts to come together and work together.
These are all key elements. So they actually work together. It's not just one system, it's how do you work all these systems together.
Mr. Morales: Chuck along similar lines, my understanding is that the USDA is a sponsoring organization of Shared Services in the federal government. Could you tell us a little bit more about your efforts in this area, specifically can you tell us a little bit about the National Finance Centre or the NFC?
Mr. Christopherson: Yes, the National Finance Center is a Shared Service on two different aspects. The first one is payroll processing and the second one is actually a nice handshake to that one which is the human capital systems. And this group just does a fantastic job. You know, what's really interesting with Shared Services is as, you know, we are looking at the human capital element of this. We are looking what did it cost for USDA just to have this system by itself?
And we came out that, you know, and being one of the early adopters it was, you know, about $118 to $138 per an employee per a year. That's a significant amount when you have a 100,000 employees. As we start to migrate to other groups on, so Homeland Security is also one of their customers. When we get ourselves fully migrated on we get Homeland Security fully migrated on.
Suddenly the model starts to dip down and to -- it cost about $70 per employee. That starts to tell you the significance of the Shared Service initiatives across the government realize that if they can take, you know, 600,000 people and even save, you know, $30 per individual, that's a large amount of money. If I can save $50, if I can save $100 it becomes very, very large in the way that we operate.
But that group does a fantastic job and we've talked about you know, as you have these systems how important it is that they have the right continuity of government plan in place, and that is fully tested. And this group fully tested it out, we have made some changes in which we did take the primary data center and it is in the West now, and operates out the West.
They have become you know, basically it's a full data center and USDA recapitalizing off of that by actually now moving into taking all of our applications basically out of the mission areas and sticking them into data centers where we can get strong architecture behind our operations and see a vast amount of cost savings as we go forward.
Mr. Morales: That's a great success story and just I think a wonderful model for the federal government.
How is the USDA using Lean Six Sigma to enhance its operations and performance?
We will ask Chuck Christopherson, chief financial officer and chief information officer at the USDA to share with us when the conversation about management continues on The Business of Government Hour.
Mr. Morales: Welcome back to The Business of Government Hour. I'm your host Albert Morales and this morning's conversation is with Chuck Christopherson, chief financial and chief information officer, USDA.
Also joining us on our conversation from IBM is Mike Wasson.
Chuck, our center has recently published a report entitled "Improving Service Delivery in Government with Lean Six Sigma. "
Could you elaborate on your recent efforts in applying Lean Six Sigma within your operations? Specifically what benefits do you seek to realize from using these principles?
Mr. Christopherson: Well, I love to elaborate on Lean Six Sigma. I think it's something that is very healthy for government and as each time I, you know, read the press on Lean Six Sigma in government, it's either, you know, seems to be either a love or a hate. And I think the answer is probably, you know, somewhere in between.
But let me tell you why at USDA I started implementing a Lean Six Sigma program, and it wasn't because you know, half of the, you know, Fortune 500s have it or anything like that, and you know, if you look at the top ten, they basically all have it. But it comes back to inside of government, you know, we need managed change and we need perpetual change. We need to have evaluation on that change, and our people really understand -- have to understand formalized processes and procedures.
As I looked at USDA, I said, you know, we're going to have this high turnover -- at about 12 percent that will be, you know, in the out years coming up, and it's starting to happen. People should, you know, be entitled to sit down at their desk, their first day, you know, on their job, or the first day that they're new into a different job, and have the ability to say, hey, this is what I'm responsible for in a process. And this is what happens before me, this is what happens after me.
If I'm a new manager, I should be able to walk in and say, this is what I'm responsible for. On top of that I should have a desktop that's very intuitive to house me through this process on daily basis. It gives me the task, et cetera. This doesn't sound much like Lean Six Sigma, but this all came out of Lean Six Sigma on, you know, from our group on what needs to happen. You know, when it comes to Lean Six Sigma, you know, suddenly we're now in managed change instead of change by crisis. So now our people are controlling their change.
One of the things that really bothered me was as we went out and we had these competitive sourcing competitions, was that we were finding that we had vast savings, and about 80 percent of the time the internal team would win and they'd generate these savings. That tells me that, you know, we had some process improvement, so we could -- that we could handle one side.
And if I get cost savings that's great, because I have so many areas that I really need to invest and take it us to the level that we need to be a USDA. That quickly gets invested back into both people and processes and systems very quickly to get us to the point that, you know, lot of our systems can handle lot of paper-based functions today.
So, anyway this wasn't, you know, initiative that was taken real lightly, and Lean Six Sigma isn't something that's easy. It's you know, something that's tough. But our team has really taken hold of it. I give my choice at one time of either bowing or pushing it forward, and they said we are going to push it forward and they organized, our SESs did this -- executive committee to actually do oversight of it.
They want to write it into their top five items in their performance plan. That's a lot of initiative from our government teams on something that, you know, I just started with the thought and the idea, and hope that it would take off and they actually took the ball and ran with it.
Mr. Morales: Now you used the terms "managed change," and I heard you use the term "crisis change. "
Could you give me a little more perspective on what you mean by these, and how do you lead change and enable your staff within the organization to sort of expect the inevitability that the change will happen and that they should try to make the most of it?
Mr. Christopherson: That's a great question. Probably, you know, one of the best questions that our employees often ask of me is, you know, what's the difference, you know, in change because when I first came into USDA, anything that -- anytime you said change, you know, the body language used to be just incredible in the room.
And you know, the people will start squirming in their seat and have this great fear. And so we had to have conversations on, you know, realize yesterday business changes, and if it doesn't change, what'll happen is it eventually will be forced to change and usually it's a crisis that causes it to change.
And so the answer is let's manage change. You know, there was more risk, you know, when we all drove in this morning, you know, to change lanes than it is to actually, you know, manage ourselves through some perpetual change through the organization.
What's very interesting though is one of our Black Belt projects is, how do we take people and actually start to focus their training on where they need to be now where we are. And so you've jobs that are here today. On top of that some of those jobs will get modernized out. It's kind of the reality, but part of this is how do we take people and you know, start to move them to be trained so they're multi-talented, so that we can say the next generation of government, you are ready for and you are ready for this change.
And so we basically took the Lean Six Sigma program and said, you know, government is going to have some change and then on top of that we said, we need to Lean Six Sigma the change. And so how are we going to do that?
So you know, that's where we are going. Anyway, it's kind of, you know, point in time where we are at and people are just really adapting to taking it on.
Mr. Morales: That's great. It sounds like you are driving towards a culture where it's less risky to be proactive than it is to be reactive.
Mr. Christopherson: That's true. And actually what'll happen is USDA will actually be a safer organization than a lot of other organizations, whether it's in the private sector or in the public sector, because we are managing change perpetually as we go along.
Mr. Wasson: Well, along the lines of change the E-gov initiative are continuing to approve an expand service to citizens, businesses, and agencies alike. A number of agencies had changes in their E-gov scorecard rating in the last update.
Would you tell us about your department's effort in this area? What are some of the critical challenges your department faces, and what are you doing to progress and improve the E-gov initiative?
Mr. Christopherson: E-gov is, you know, a very interesting scorecard, and it's interesting in a very good way. You have two aspects of that. One of them is you get to choose some things that you get to have on E-gov, so some initiatives that you have internally and things like that.
Now, the second one is some government-wide initiatives that are happening as well. So, protection of information, different things that are in the environment that we need to work through. For USDA, we drop down for a short period of time, you know, for a one instance to "yellow"; we have been "green" most of the time.
That's something we take very seriously, obviously, as we are looking at how we adjust our organization to be more dynamic when it comes to technology, more service-oriented when it comes to customers, and how do we become more service-oriented when it comes to internal police? You know, it comes back to technology where it just where E-gov is.
I hope that, you know, as we have some transition in this government that the E-gov initiatives will continue on. The second piece of E-government is just, you know, I just saves a lot of money. You know, as we started standardizing certain elements, the cost savings, because we are able to go out to get some, you know, basically buy in bulk is incredible.
It gives us some focus and says you need to focus your people in these areas and have talent in these areas, and this is what's important. That focus makes us, so we don't have teams that, you know, have to be, you know, looking at every thing, now. Suddenly we have certain focus in certain areas that we are looking in as well.
So you know, the E-gov is expensive, but at same time, you know, it saves us a lot of money. I don't think we necessarily measure the savings as well as we measure the cost, and what short-term is investment will be a long-term savings, is going to make the U. S. a lot more competitive as we go heavily into more of a world environment where we don't have more of the monopoly of, you know, being the big capitalists group.
Moreover, we have more of a level playing field with our products and stuff in the United States out to the world markets. And so that'll be key that these E-government initiatives continue to go forward and hopefully we can actually move them a little bit faster.
Mr. Morales: In some quarters there is a perception that government lags behind the commercial sector in technology innovation. First, do you think this perception is accurate, and second, how do you think the government could enhance its position to become a leader and driver for leveraging technologies?
Mr. Christopherson: I think the answer to that is yes and no. You know, it's -- it comes back to, you know, some industries, you know, are laggers for technology, some are advanced for technology. You know, USDA, you know, obviously, you know, we mirror ourselves, you know, after somewhat the banking institution and research institutions, you know, when it comes to technology, we should be very advanced in technology and we should be dynamic.
We are not quite there yet, we are a little behind. But we've been, you know, and Congress knows this, and you know, administration, State Department know this, we have plans that are laid out, we understand what our priorities are, and obviously we want to move off 1970s, 1980s infrastructure, get to a more dynamic infrastructure.
We want our folks at the Farm Service Agency to have their choice that they can telework or they can go up to a farm service agency office or something like that. We want our customers to have that same choice where they can either, you know, go into a Farm Service Agency office or they can accomplish what they need to on their desktop at home. They can have their spouse do it, they can have their accountant do it, they can have it anyway. You know, technology for us is about choices and a lot of people, additional freedoms and we need to make sure that we do that, at the same time making sure that we protect people's information.
So you know, we are little bit lagging in some areas, I wouldn't say all departments are at that same area. But I'm seeing that USDA is advancing very fast. And we have changed our model so that those agencies that have that core piece that really need that core piece. So if I'm looking at grants, they develop out and then they say what do we need for grant's process across USDA, and they work with the other grant entities in USDA and come to one process -- what should the customer see, does that match up with what the rest of the government is doing and things like that.
So, if its grants we have Grants. gov, which makes it a very easy platform, and we just say Grants. gov, you are the interface with the customer. But however, the customer should be able to see every single step in the grant process, all the way through. So when it comes to that, if you are a grantee right now, and you apply for a grant, you know, you have a void between your application and when you, you know, basically have an award, and that void shouldn't be there.
So, you should have the ability to say, did I fill out everything correctly? Did I get -- basically am I, you know, qualified now? What's the timeline on the qualification -- on those people are qualified in the pool where they are going to make a decision? Was the decision made? And am I in that decision or am I not in that decision?
And so I think that's only fair for people and if you can get the award, you should understand what all the next steps are that you have to accomplish if you have to have things like you know, an accountant sign often your financials or bank sign often your financials. You need to know that in advance. And then you should also know basically when the payment is coming, and after that what your responsibilities are.
So anyway, we have ways to go before we get to that piece of it. But you know, I think it's a great opportunity.
Mr. Wasson: Chuck, you mentioned earlier protection of information. Could you elaborate a bit more on your department's efforts to improve its IT security and controls and what in your opinion remains to be done to remediate this major management challenge?
Mr. Christopherson: You know, focus on you know, privacy information and cyber securities is, you know, very big right now on the federal government and should be. Our citizens expect that they'll have their information protected, and the federal government has the best systems, and the best safeguards of information they should, because you know, we care a lot of sensitive information, classified information, and it makes people worry as soon as -- as soon as they see something like this happen.
Lot of our systems are in 1980s, 1970s systems, the key indicators, words, things like so security numbers that connect multiple systems together, and that's tough, and it is complex and the way that we start to unravel this complex tapestry of systems.
But you know, we have laid out several groups, and I'm not a huge committee guy. But I found that, you know, for some of these multi-talented teams that we need a committee plays very, very well. I mean, finance and IT, you know, across the organization is key. I have a huge amount of privacy information both of those sections, we had HR and now suddenly have the majority of it. And we actually laid out a taskforce that basically had those elements including my cyber security people as well.
And so you know, we have actually laid out a full plan, and it's -- it had ended up being about 121 different items that we wanted to address including tools that we want to bring in to understand where the systems are, questions the agencies had to answer, what we want to laid down for temporary protection versus long-term protection, part of our migration to data centers is also to look at protecting this information.
So the answer to this actually a complex answer that goes to -- you've got to standardize, you got to simplify, you've got to lean how to contain, and you have to have tools in place, and you have to manage. And so those are all key elements on how you manage the privacy information.
Mr. Morales: What does the future hold for the USDA financial and IT functions? We will ask Chuck Christopherson, chief financial officer and chief information officer at the USDA to share with us when the conversation about management continues on The Business of Government Hour.
Mr. Morales: Welcome back to The Business of Government Hour. I'm your host Albert Morales, and this morning's conversation is with Chuck Christopherson, chief financial and chief information officer at USDA. Also joining us in our conversation from IBM is Mike Wasson.
Chuck, we talk with many of our guests about collaboration. Can you tell us a little about the kinds of partnerships that you are developing now to improve operations or outcomes at the USDA, and how do you see these partnerships changing over time?
Mr. Christopherson: We actually, you know, as you expect, we actually collaborate a lot both inside the government with different entities, inside of USDA, as well as with the vendor community with the different things that we own and operate, to take a little more simplistic approach on collaboration and not get into the multi-department collaborations. But you know, inside USDA we talked about having multi-task teams and actually implementing processes across USDA and not just in silo organizations. We also work, you know, with the Department of Interior in some coordination as well and some communications, because Forest Service has interactions with them as well.
And then when we get to, you know, the vendor community, and especially when it comes to information technology, one of the things that's been really key for our people is to, a, understand what we own, and then understand how to fully utilize it, and understand how it connects to other pieces inside of USDA, and that's a learning curve that we went through this last year. We found that there were some, you know, great products that we had already owned that we hadn't fully implemented, and once they are implemented, it just filled in the 5 percent of a 95 percent solution. And so, you know, what's happened is, you know, we've worked with a lot of vendors on the products that we have to fully understand and utilize their knowledge when it comes to their products, and it's amazing how fast you can actually leapfrog when it comes to technology. You can take, you know, a 1980s organizational process and actually take it all the way to 2007, and have a plan to take it on, where you're going through -- 2010 to 2015, by a very simple conversation or two days with, you know, a group or vendor that you have their products.
So you know, we don't take these things lightly as we do them. It's very intense, our teams are very intense as we work through them; we ask very hard questions et cetera. And then we always ask -- especially with information technology companies, we do resort often back to tell us about your Lean Six Sigma program, as most of them have that program in-house, and it's a great learning environment for our IT and finance employees.
Mr. Wasson: I'd like to transition now to the future, Chuck. Can you give us a sense of some of the key issues that will affect CFO and CIO offices, government-wide, over the next couple of years?
Mr. Christopherson: I think the biggest issue is that we're going to be through a prolonged period of very thin budgets. If you look, you can -- you know, we're getting more competition in the world. We are getting more requirements for resources, inflation is not changing; it's not going down. Probably you're going to go through some inflationary period here -- and that's actually respectable if you look across the board, the lack of inflation that we've had for many, many years, employee salaries will continue to go up; all these things will put continued constraints on the resources on the administrative discretionary budgets, things like that.
And so I think that's going to be a big issue, and only those agencies or departments that really understand how you take something through a whole change management to say, how do I get from something that's old and continually perpetuate to something that's new in an organized manner -- those ones that can't do that are going to struggle. There is just not going to be for a lot of areas unless you're -- it's incredibly strategic. So you know, things that we measure like pandemics and stuff like that is, you know, very strategic when it comes to the safety of the United States.
You know, those would get funded first, and then it's basically what gets funded last, and some things won't get funded at all. And so it still -- it's the same budget. You only have a -- you know, money is in limited supply. Those constraints will continue, as far as I can tell, for the foreseeable future. So I think it's going to be -- it's going to be tough. And you know, where USDA shines in that is by having two hats on this one organization, is it very clearly allows us to both lay out priorities for the IT people in saying, this is what we can fund; therefore, this is what we do, and you know very, very quickly, this is what we do; instead of going through, you know, the (inaudible) and minutiae saying, "I'd like to do this, but you don't have that money; well, I'd like to do this, but I can't afford that," that you often see when things are split. And also on the finance side, to have the ability to capitalize off of information technology across the board would just be key, and then we could start lessening the cost of how we operate finance inside the federal government as well. So, two dynamic elements really help out in the future at USDA.
Mr. Wasson: Now on a broader basis, what are some of the major opportunities and challenges your organization will encounter in the future, and how do you envision your offices will evolve over the next 5 years?
Mr. Christopherson: Some of the broader challenges are -- it still comes back to how do we support out the mission of USDA. When I first came in -- and I continually do this -- I spent a lot of time in the various missions. And so I spent time, you know, at the Forest Service shared-service operations that's in Albuquerque, to understand them. I spent time, you know, at one of their regional operating offices. And then I went up in to, you know, a national forest to visit that and see the dynamics of those. You know, I've done that also with the Farm Service Agency and multiple other groups. I've been out to look at research in that operation.
Anyway, you know, those things are just key in how we actually truly understand and keep focused on the mission areas. And oftentimes, as we -- as we get tight on our budgets and we have all these other things that are happening, we start looking down, and we forget about the mission areas, and we're like, I have to focus on my budget; I have to focus on this; I need to, you know, install this and do this. You know, the first step for us is always, you know, look at the mission areas and what they need, how do we optimize a mission area in running their infrastructure and their support. How do we basically take, you know, what's an org structure as that looks like a tree flowing down; how do we flip it over and make it so that administration is now supporting, the mission of USDA that, you know, basically is the mission of the American people.
So that will always continue to be a challenge; how we support that with the budget and how we make the right decisions with that is key. But I think the nice thing is that, you know, as I look at this President, if I just put a milestone out there, you know, I would say that, you know, this President has really taken us to a business level of government in operations that is very measurable, that we understand where we should be putting in our money, we understand where we have issues and errors because we measure, and we know exactly where we have big problems that we have to address.
Those were tough to, you know, look at sometimes and identify and say, "Hey, I have a problem here," but we've now injected some honesty into government, and it allows us to address our issues very forthright.
Mr. Morales: Now Chuck, you alluded earlier to the pending retirement wave within government. How are you handling this issue and what is your organization doing to ensure it has the right staff mix to meet such a challenge?
Mr. Christopherson: Well, as executive, you always have to watch your turnover in the organization, and make sure that you've the ability to retain and manage skill sets. We looked at this and on, you know, the CFO side which I have more years, in management, we looked at that and we said, you know what, we have a problem. You need to go through and make sure that, you know, we train people at least to have the ability to have them compete for those positions. You know, your staff compete for an SES position unless you go through the SES program.
You know, as I looked at, I said, inside of USDA (inaudible) basically to have at least, you know, the skill set as we go forward. On top of that, that allows our SESs to be more flexible as well. So our senior executives now can have a broader focus versus just a focus on, you know, one small item or something like that, or how do I manage people moment by moment, versus how do I manage them, you know, a week at a time. And so basically with Lean Six Sigma, and with some other programs that we have instituted, we've started some of that training. We've looked at people individually that are the next level down from our SESs and said, really what do they need to complement themselves in order to start to move up.
They have a choice. I mean a lot of people that, you know, are GS-15s don't want to deal with all the issues that SES has to deal within the flexibility that SES has to have. I mean, you've to be available basically, when somebody picks up the phone and says, "Congratulations, you are senior exec; you have to operate this COOP plan. You have to do this," or whatever. People should have that option and it should be that, you know, every senior executive that's out there should be managing this inside of their agency, so that way we have a nice filling of the SES ranks as we have these changes. Anyway, I can only manage what -- what's at USDA, but the great thing is that I hope then that people at USDA can wholeheartedly compete for, you know, SES or GS-15 jobs across the federal government as well as compete for those inside the USDA.
Mr. Morales: That's great. Now, you came from the private sector, you've now spent about 2-1/2 years with the USDA. What advice would you give to a person who is out there, perhaps, considering a career in the public service?
Mr. Christopherson: In some of our sidebar conversations here -- and I think you've seen some of my enthusiasm with USDA, and you know, it's not just what the government looks or feels like from the outside looking in. It's actually, once you're in -- the government is fascinating. The people don't always fully understand like what USDA does. Until you go out and you tell them, they'll say, "Oh, you're Forest Service, oh you're just," you know, everybody looks at the stamp on the meat and says, that's what you're responsible for. And then when you talk about the food assistance programs, and you know, food stamps, they understand that.
Then you talk about food permit, they understand that. But you know, I'll tell you, I have on the subcabinet with me, I've doctors with me, I have probably some of the best business minds that I've seen, and they're operating high profile programs that you can very clearly see how they affect the nation. I'll tell you, the opportunity to serve, whether it's -- you take a job at the pleasure of the president, or you take a job as, you know, trying to move into the civil servant ranks, you know, I think it's just a great opportunity. You know, the people at USDA love their jobs. They love their mission; they understand what they are supposed to be doing. People in the USDA are passionate about their programs, and I assume it's that way across the government. The nice thing is that you make a clear difference in the United States, and in the world.
Mr. Morales: That's great, thank you. Unfortunately, we have reached the end of our time, but more importantly, Mike and I would like to thank you for taking time to participate here and also for your dedicated service to our country in your -- across your roles at the USDA.
Mr. Christopherson: Thank you, and you know, I really appreciate this opportunity; it's been a great opportunity. You know, hopefully as people listen to this program, they understand a, you know, how fast the government is moving and how complex it is, as well as how simplistic it should be for citizens to operate inside the government. You can go on to usda.gov or to, you know, the various GSA sites that are out there to start to look at the programs and how the government is truly changing, how it's becoming more, you know, citizen-centric, user-friendly et cetera -- all the things that the President really wants to have happen. And so it's a great opportunity; I really appreciate the time that the two of you've taken out of your schedule to sit down with me at this time.
Mr. Morales: Great, thank you. This has been The Business of Government Hour, featuring a conversation with Chuck Christopherson, chief financial officer and chief information officer at the U. S. Department of Agriculture. My co-host has been Mike Wasson, director in IBM's federal civilian industry practice.
As you enjoy the rest of your day, please take time to remember the men and women of our armed and civil services abroad, who may not be able to hear this morning's show on how we're improving their government, but who deserve our unconditional respect and support. For The Business of Government Hour, I'm Albert Morales, thank you for listening.
Announcer: This has been The Business of Government Hour. Be sure to join us every Saturday at 9:00 a. m. and visit us on the web at businessofgovernment.org. There you can learn more about our programs and get a transcript of today's conversation. Until next week, it's businessofgovernment.org.
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