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Tuesday, August 17, 2004
Mr. Lawrence: Good morning and welcome to The Business of Government Hour. I'm Paul Lawrence, partner in charge of The IBM Center for The Business of Government. We created the center in 1998 to encourage discussion and research into new approaches to improving government effectiveness. You can find out more about the center by visiting us on the web at businessofgovernment.org.
The Business of Government Hour features a conversation about management with a government executive who is changing the way government does business. Our special guest this morning is Lieutenant General Steven Boutelle, Chief Information Officer and G-6 of the Department of the Army. Good morning, sir.
Lt. Gen. Boutelle: Good morning, Paul, great to see you this morning and I appreciate the opportunity to talk about what we're doing in our service.
Mr. Lawrence: Great. And also joining us in our conversation from IBM is Chuck Prow. Good morning, Chuck.
Mr. Prow: Good morning, Paul.
Mr. Lawrence: Well, General, perhaps you could begin by describing the mission of the Department of Army's chief information office, G-6?
Lt. Gen. Boutelle: That's a great question. The CIO and G-6 of the Army really has multiple roles. As the CIO we hold that traditional role, which is providing IT services across the force. Now, when we say "across the force" for the Army that's significantly different in some corporate worlds, that is, global requirements for IT wherever you are in the world, any time, any place. And generally and quite often in today's environment that is in a place where there is no infrastructure.
Under the G-6 role we actually provide the soldiers, the young men and women who operate many of those services, be it in Afghanistan or Djibouti, Horn of Africa, South America, or here in the continental United States.
Mr. Lawrence: Tell us about the people on your team, especially the skills.
Lt. Gen. Boutelle: The skill set is a varied skill set but they do have a common core and that is somewhere they're involved in the IT industry. We do have those people that are in the resourcing business but really in the IT industry and that is all the way from software and computers up to transmission systems via satellite, tropospheric scatter, microwave, or hand-held tactical radios.
Mr. Lawrence: And how about the size of what you're taking place in terms of a budget, don't want any secrets but it's always interesting to put what's going on in the service in the context of other Fortune 500 companies?
Lt. Gen. Boutelle: Our IT budget is about $6 billion and that runs over our palm so it's a significant budget in the size of business.
Mr. Lawrence: And then you were describing how combat operations in Iraq and Afghanistan and the like are involved. How do they affect the budget?
Lt. Gen. Boutelle: We have the normal budgets that we have in peace time although our budget doesn't significant change although it's increased with the current supplementals in the war in Iraq and Afghanistan. So those are usually supplementals on top of our normal budget where we buy and push services be they leased services of satellite services or information services or actually buying systems, commercial systems, to put on the ground in Pakistan or Afghanistan or Iraq or other places.
Mr. Lawrence: A while back we interviewed Kevin Carroll, the program executive for Enterprise Information Systems for the Army and he talked to us about how his organization was now falling under the CIO/G-6. Could you talk to us about the reorganization?
Lt. Gen. Boutelle: Sure. The Army has, like many of the services, program executive officers. Those are the acquirers. They award the contracts for research and development and eventual production, whatever the system is, be it an airplane or a helicopter or in Kevin Carroll's place it's enterprise services. Most of the work that Kevin Carroll does in PEO EIS, and he would tell you 50 to 60 percent of the work is resourced or funded by my organization, those are large-end satellite systems in Baghdad or enterprise systems around the world.
Mr. Lawrence: So by putting it under the CIO does that make things more common?
Lt. Gen. Boutelle: Makes it much more common. There are about 12 program executive officers in the Army, one for aviation to buy helicopters, one for ground combat systems that buys tanks, another one for missiles, and it was a natural fit for Kevin Carroll and EIS to roll underneath the CIO/G-6. The other 11 PEOs currently work under Lieutenant General Joe Yakovac and he's responsible for providing those services.
Mr. Prow: Good morning, General. As CIO and G-6 for the Army what are your chief roles and responsibilities?
Lt. Gen. Boutelle: Well, several chief roles and responsibilities separated. As the CIO I do provide the enterprise services and the direction and the guidance and that is to ensure that the user at whatever level, be it the tactical level, the young soldier in the field, or back in the United States, whether he's operating at a depot or an office or behind a desk, has the appropriate IT services. That means bandwidth to the desktop or to the soldier moving across the battlefield or to the attack helicopter, provide all of those services. Some of those are leased services, some of those are products, and some of those are buying at an enterprise level.
Mr. Prow: Can you share with us a few of the highlights prior to you becoming CIO and G 6 of the Army?
Lt. Gen. Boutelle: It's a long road to be the CIO/G-6 and I will tell you if you look at my predecessors each one of them has had a different path. My immediate predecessor was Lt. Gen. Pete Cuviello. He came up pretty much more of a traditional communications role. But in my case I started out as an inductee back in 1969 and elected to join the Army and started out in nuclear weapons electronic repair.
At one point in time I went to artillery officer candidate school, probably because I had reasonable math scores, and in the wind-down of Vietnam I also had a background in electronics and electrical engineering and was shifted over into communications and electronics, spent quite a few years in that. Most of us spent a lot of years initially in combat divisions and I was in the 3rd Infantry Division, the 8th Infantry Division, and 5th Corps, 7th Corps in the United States, in Korea, and, of course, various places around the world.
At a certain point I went into the acquisition business and that is looking at buying products from the commercial world. And when you get into that business you make a shift. You're no longer primarily working communications. You're more working general electronics, software, computers.
And probably the defining event was about 19 -- probably about '87 when the PCs first started to hit the market and I worked in an organization where they were coming in. And I came home one day and I said I think these new things called personal computers are going to go somewhere and spent many nights and evenings doing some very, very basic programming and rebuilding and building computers and have been at it ever since.
Mr. Lawrence: When you look back at those experiences are there any one you talk about when you talk about your career that prepare you for where you are today perhaps from going from a doer to managing a doer or understanding the role that you would play as a higher ranking officer?
Lt. Gen. Boutelle: Well, I think that's a great question and one of the most difficult things we do, as our chief says, is build a bench and that is identify those people who need to take your job should you depart that job or who your replacement's going to be. And I don't think we do that all well or as well as we could both in industry and in government. And one of the things we do as senior officers is we look out across the landscape of those people who work for us or who are around us and try to identify those young people who are starting to broaden their horizons and no longer looking down at just doing the function that they're trained to do but start looking at where the Army is going, where the nation is going, where the world is going, looking at the geopolitical environment and how to start to apply the technologies to where we need to go, not where we are today but where do you need to go in the future. And so identifying those people is one of the things we as leaders need to do and then mentor those people.
We seldom want to send our superstars off to school for a year or six months. We want to keep them close to us. And we need to make those hard calls and send those people out and make sure they get the right experience, they get the right schools, they get the right exposure so we can bring them up to take our job and hopefully do a better job of it than we've done.
Mr. Lawrence: I have a pretty good idea from your description of what drew you to public service but what's kept you in? I imagine from time to time you might have thought about going into the private sector. What's kept you?
Lt. Gen. Boutelle: I think a combination of two things. You go along for a certain period of time and you do it strictly because you really enjoy the feeling of accomplishment. And in my business on a day to day basis and some days are better than others but you generally feel that you've accomplished something and you're pushing this technology the right direction. And I think probably over the last few years it's probably been a knowledge that since I have been in this business for a long time, I've been a program executive officer, I've been a project manager, I've built systems, that I thought that I had a bench of knowledge where I could apply those or help apply those to the young soldiers in the field and in the current war and what I believe will be the future wars on terrorism.
Mr. Lawrence: Tell us about some of your personal style in managing and leading, for example, communication. A lot of people talk to us on this show about the importance of getting your message out and communicating to your team but yet you have a big team and it's spread all over the world. How do you do that?
Lt. Gen. Boutelle: One of the things we do and one of the things I've tried to do is right up front have a very narrow set of objectives that everyone can understand, six or seven things that you want to accomplish in the period of time you're going to be there, two or three years or whatever it may be, and don't change or adjust those unless absolutely necessary. And then you will find that if you put that out to the senior leaders that you'll find that everywhere around the world globally they all understand what you're trying to do and where you're trying to go and be consistent. You need to know where the boss is trying to go. You may not agree with him but you need to know where he's trying to go.
And the second thing is visit them as often as possible. I don't believe we need to micromanage these professionals. They know how to do good work and make things happen. Draw the white lines in the road and give them the objective and the direction, surround yourself with some really good managers and senior people, and I have a superstar staff, and periodically check on them and praise them when they do a good job and give them guidance if they don't. But I am extremely pleased where the Army people are going around the world.
Mr. Lawrence: How do you think about the speed of decision-making in government? Is it fast enough? Is it slow enough? I know we've talked to a lot of people who've come from the private sector who joined government and are somewhat surprised at the speed by which decisions are made. How do you think about that?
Lt. Gen. Boutelle: I think we're in a hybrid right now. In peace time we build very strong armed forces but we do it very methodically and we do it within the system. The exponential growth in the IT world, specifically in IP, XML, web services, that's happening around us does not lend itself to making decisions and putting those systems in the field as quickly as we want. Every circuit board I buy for a system in six months is outdated and there's a new one to replace it. Our process does not support that.
Having said that, in the current war and with the nation in the state it's in today and still in national emergency after 9/11 we are able to do things very, very quickly based upon supplementals and a wartime environment and bring systems in very quickly, replace old systems. So I would suggest today we can make a decision today and make things happen in a matter of sometimes hours or days. That is not true in a peace time environment and that's okay. In a peace time environment you want that structure, you want to build that underpinning and that base to have a stable Army or a stable Navy or Air Force. But right now we can make decisions very, very quickly and execute very quickly with industry.
Mr. Lawrence: That's an interesting point about the speed. What does the term "network-centric operations" mean and why are we hearing so much about it these days? We'll ask General Steven Boutelle of the US Army to explain this to us when The Business of Government Hour continues.
Mr. Lawrence: Welcome back to The Business of Government Hour. I'm Paul Lawrence and this morning's conversation is with Lieutenant General Steven Boutelle, chief information officer and G-6, Department of the Army, and joining us in our conversation is Chuck Prow.
Mr. Prow: General Boutelle, can you tell us about some of the IT lessons learned from Iraq and Afghanistan and how those lessons are affecting Army technology?
Lt. Gen. Boutelle: I'd be glad to, Chuck, and, as you can imagine, Afghanistan and Iraq have many lessons that we've learned. Probably the one lesson I've learned, and I just returned from the theater, is where there's a vacuum today or something doesn't exist today with the pervasiveness of the tools that we all use somebody's going to fill it. And what I mean, if I don't take and provide a particular IT tool, a radio, a computer, a wireless network, to a certain organization within, say, Afghanistan in a very short period of time to meet their needs with the availability of those things off the commercial network they will buy their own, they will install it themselves. These young men and women are just like the kids here. They know they can buy a router and a switch. They know they can buy a wireless network and a bunch of cards and build their own network. If you don't provide them the right tools quickly and a vacuum appears they will fill that vacuum out of their discretionary funds.
Mr. Prow: Interesting. Has the evolution of technology affected the evolution of war fighting?
Lt. Gen. Boutelle: I would say absolutely. Two things, one is when you make IT pervasive as it is today and information pervasive as it is today you tend to flatten your hierarchy of management much as is happening in the commercial world. Let's face it. Today in the commercial world as well as in the Army if a young soldier or sailor or airman decides to launch an e-mail message to his boss or to his wife back in the United States it goes at the speed of light minus switching time and that information flow is so quick and the ramifications of it flow very quickly. No longer do you have the point where you have someone at the bottom part of the architecture or the hierarchy who has to manually put something on a piece of paper and send it through maybe his boss and his boss's boss and his boss's boss and over a period of time get a decision. It's near instantaneous so you flatten the management hierarchy.
What that's caused us to do in the Army is relook at how many levels we have. The Army basically has four major levels of hierarchy. We have brigades, divisions, corps, and army. We're in the process of removing one of those levels and in that process when you move a level you start parsing out and sharing those management responsibilities. So when we finish this process we will have three levels. We know that. We know we're going to have brigades; we've already announced that. Divisions, corps, and armies, at the end of the day only two of those will continue and you'll parse those functions. And you can do that because of the information technologies.
Mr. Lawrence: How long will it take to resolve which two of the three?
Lt. Gen. Boutelle: I think that'll probably resolve within 12 to 18 months. We've already decided that the lowest level, the brigade, will still survive, but what we've done is we've enhanced that brigade with IT technologies to allow it to be able to operate within other services, in other words take an Army brigade and nest it in a Marine division. We can do that as we're building IT services in. So the brigades the brigade is our basic fighting unit today as we evolve, as we're building today, where in the past it would have been a division but we're going to make those brigades very autonomous and independent and we are able to do that with a lot of command and control communications, satellite systems, IP-based networks.
Mr. Lawrence: We've heard you speak about the importance of reading and understanding the Chief of Staff and the Secretary of the Army's paper, "Serving a Nation at War: A Campaign-Quality Army With Joint and Expeditionary Capabilities." Could you summarize the key messages one should take away from this paper?
Lt. Gen. Boutelle: The key message in that is we need to make a dramatic change in the structure of our Army. The Army is primarily and has been designed for many years to fight on the East German plain-North German plain against the Soviet Pact or in the Korean Peninsula and it's a very structured Army. We knew the battle space, we knew the ground, we knew the cities and the mountains, we knew exactly where we were going, and we knew what we thought we were going to do when we got there. In today's contemporary environment with the war on terrorism and the radical fundamentalist groups that we're going face they are a nonnation state. They don't belong to a nation. They don't wear a uniform. They move back and forth between countries and they move globally. To be able to address that threat appropriately you need to have small mobile organizations that can quickly move around the world and perform whatever mission we assign to them.
So the Chief's and Secretary's paper says look, the brigade will become our combat fighting unit. We're going to call them brigade combat teams. There will be many of them. We're going to increase the number of them. We're going to enable them by satellite-based networks because so many of the places that we have found the al Qaeda and other organizations are in nation states that have failed or Third World nations where there is no infrastructure. So to enable those organizations takes lots of satellite capability, lots of IT capability, a heavy reliance on intelligence, and providing that to those organizations. So I think the Chief and Secretary's paper is you've got to dramatically change this Army and you need to do it now.
Mr. Lawrence: What does it mean to the individual soldier?
Lt. Gen. Boutelle: There's a couple of pieces in there. One piece of the Chief's paper says look, we're going to be a campaign-quality Army and we're going to be joint. The Chief would like us to have home station operation centers and project force out of the United States and in doing that he will stabilize the force. Right now and in the past we've moved people about every three years, sometimes more often. Do we need to do that if we're going to be a force-projection Army?
A young man or woman can come in the Army and really spend three, four, five, six, even up to seven years at the same place, have his family buy a home there, settle into that community and use that environment. And if he gets promoted move him around that post, camp, or station. There's no good reason in today's environment to move him automatically every three years just because the clock ticks off three years. When the Chief says I want your families in the same place let's have them in a home station. Let's have a good quality of life there and spend some resources on making that a very powerful quality of life and project force out of that place when we need to.
Mr. Lawrence: The paper talks about a lot of big change and I'm curious. It doesn't really talk about how long it will take to achieve this point, the change?
Lt. Gen. Boutelle: Good question. The 3rd Infantry Division, which returned from Iraq this spring, which is the division that actually went into Baghdad, will be radically changed by the end of this year. It will not have three maneuver brigades. It will have four maneuver brigades. It will have the new IT system, the new satellite system, the new voice-over IP systems, all the new networking, all the new Red Switch and CIPR and IPR and all those types of things. We have started delivering that last week. Soldiers are already training on it. We will completely outfit that division, turn it around, and have it ready to deploy again after the first of the year. We will do three more divisions in calendar year '05, the 101st Airborne Division, the 10th Infantry Division, and the 4th Infantry Division, all before the end of calendar year '05.
Mr. Prow: General, we often hear of the concept of network-centric operations. Now, what is N-CO and how does it apply to the Army?
Lt. Gen. Boutelle: Network-centric operations which we are trying to achieve I think is an end state, and I'm not sure quite what the end state is, but we have tremendous amounts of information that we generate and that we store. The question is how do you get that information readily to all the decision makers, be that decision maker at the lowest level or somewhere back at a depot on a sustaining base in the continental United States.
Most of us are primarily circuit-based and have been circuit-based for many years; that is, a data stream flows from point A to point B. Network-centric operations presume that you can make that data centrally stored, you may cache it elsewhere, and it's available to everyone. And as we do that we start to get the synergism that has been promised to us for so long. The tools that will make that happen are really the web services, a combination of XML and SOAP and UDDI, lots of the web services protocols that will start to allow us to leverage these terabytes and in some cases petabytes of information we have stored.
Mr. Prow: On that topic can you also describe LandWarNet and how it will impact the business of war fighting within the Army?
Lt. Gen. Boutelle: Yeah, Chuck, LandWarNet is an attempt we've made with the TRADOC commander, General Kevin Byrnes, and Headquarters, Department of the Army, to try and bound and define what these networks are. I mean, most of us grew up that have been around for a few years where we had a separate network at the low end and it really wasn't a network. It was a voice capability at the lowest level. It was a tactical voice capability on tactical radios. And as you moved up in our infrastructure you got into what we call mobile subscriber equipment. Yes, you had a network, primarily circuit-based. It was locked on mountain tops; it was not mobile. And then when you got back in the United States you got into other circuit-based networks that tie together depots, the corporate world, the Army corporate world, and the other services. You've merged these now together with TCIP becoming the de facto standard. And now you've merged the lowest level to the highest level to the sustaining base in the continental United States with a TCIP backbone. It's a router-based network and we've all joined that network.
But as we've merged these into a single network we had to name them. And so what we're saying is LandWarNet for the Army is the network that goes from the lowest soldier all the way back to our sustaining bases and depots be they in Europe, in the Pacific, or back in the United States. It's the network plus the applications that ride on that network.
Mr. Lawrence: As you talked about this discussion of technology I hear a story of change and you talked about how change flattens the Army. And I'm curious. What's happening to in the civilian world what are called middle-level managers, people who were trained for a certainty in the world and now it's all changing? How's their life changing?
Lt. Gen. Boutelle: I think dramatically and to some people it probably is a terrible awakening because that information does flow so quickly. But it's a double-edged sword. On one side it flows very quickly. On the other side if we're not careful we leave out the middle-management level where they are there to make decisions and make recommendations and in some cases it'll flow directly from the bottom of the organization to the top of the organization without much massaging, staffing, and thought process in it. And so the good side is the information flows very quickly. On the other side in some cases you tend to lose the influence and the richness that is added by the staff. So as you trim down and eliminate some of that staff we're trying to be very careful to keep a very strong group of people in there that still add the richness to that raw information and data as it comes forward for decision making.
Mr. Lawrence: That's an interesting point, especially about the staffing. What is knowledge management and how is the Army using it? We'll ask General Steven Boutelle, CIO of the Army, to take us through this when The Business of Government Hour continues.
Mr. Lawrence: Welcome back to The Business of Government Hour. I'm Paul Lawrence and this morning's conversation is with Lieutenant General Steven Boutelle, Chief Information Officer and G-6, Department of the Army. Joining us in our conversation is Chuck Prow.
Mr. Prow: General Boutelle, we know that systems interoperability, particularly in the joint arena, is key for you. What are some of the ways that your office seeks to promote coordination within the Army and across the services?
Lt. Gen. Boutelle: Great question, Chuck, and that, as you know, has been a continuing issue and although we do have interoperability issues I think sometimes we don't give ourselves credit for all the things we should.
Interoperability applies at many different levels. One is just at the communications level or radio level. Will one radio talk to another? And so you have to solve that problem first to make sure they both talk to each other be it on the same spectrum, same frequency, and so you solve that one first.
Then you move to the next level and say what do I want to pass between the two systems and you'd have to talk about the application. What application am I going to have on one side versus the application on the other side? Are they designed to talk to each other? Are you trying to make a logistic system talk to an intelligence system? Obviously they probably will not interoperate. So you have to map and architect what those systems are.
And if you assume the applications are designed to talk to each other then you have to take it to the next level and say what messaging am I using. Am I using the same type of messaging across the network? Is one of them operating at a VMF bit-oriented message and the other in a character-oriented?
So then when you line up and get that correct then you say what's in the message. And when you define what's in the message you may both be operating on character-oriented message or bit-oriented message but then you need to get down to the data element level and align the data elements to make sure that you're passing data that you want to pass to the other application.
And once you get the data passing back and forth the next step in interoperability is how do you display it. In other words are you displaying it on a graphic screen? Have you come to an agreement on the symbology? Is it mil standard 2525B that I'm on and you're on FM 101-5? So you've got five or six different areas.
We do pretty good, pretty good, at the radio level, not perfect, of being able to talk to each other or, say, one satellite system to the other. We do pretty good when you get down to some of the other levels. And where we usually run into issues is taking the applications over time and say what is it that we really want to do. What are you really trying to do from one end to the other? And yet we tend to throw it all into one basket and say we're not interoperable and try to solve all of those things when many of those things are already solved and we need to get down at the application level and say what is the thread of information we're trying to pass and what are we trying to do when we get there.
Mr. Prow: We understand that Information Technology Enterprise Solutions is one of the Army's recent efforts to centralize IT programs. How is ITES benefiting the Army?
Lt. Gen. Boutelle: As you probably know, ITES1 is run by a program executive officer, EIS, Enterprise Information Services. Mr. Kevin Carroll runs that program and ITES1 is primarily a services- or support-based contract. I think we've awarded so far probably about $157 million worth of work off that contract but it provides services, everything from wide area network services to LAN services, IT support, programming/database support, services type contract; very powerful, allows anyone in the Army to come to a single place to get those types of services.
Mr. Prow: How will ITES2 be different from the current ITES?
Lt. Gen. Boutelle: We're running out of overhead on ITES1. We've almost awarded all the dollars we're allowed to award against that. ITES2, we will increase the amount of overhead in that or the top end, how much money we can put against that contract, significantly.
Mr. Lawrence: Let me skip subjects here and talk about knowledge management. Could you describe the Army's vision for knowledge management?
Lt. Gen. Boutelle: I'd be glad to, Paul. First of all we all are collecting tremendous amounts of data. You've got tremendous amounts of data and information and documents probably on your computer and on your hard drive today and over time that becomes not only megabytes and gigabytes but pretty soon terabytes and petabytes and, believe it or not, we can talk in petabytes in information we have in storage today and that information is pretty much static unless you have ways to access it and sort it and provide it to the right person at the right time.
That's the process we'll working right now, a combination of two things, all the information, and that information can be in the form of video, imagery, documents, messaging, translations of information that we've got around the world, open sourcing. How do you take all that information and how do you access the piece you want for one thing, to be able to make a decision in a rapid time in order to action something and have some successful event take place? When we get into Army knowledge management it is really taking data and being able to massage that data and facilitate that data to get it to the right person someplace globally to make a decision.
Several ways you can do that. One is you can just do searches on it like you do on Google or Yahoo! or Excite or something else with a search engine. What you really need to be doing right now and what we're beginning to do and what the Department of Defense has directed, which I think is absolutely the correct way to do it, is employ a lot of the XML standards to sort that information for content and intent and as we start to convert that to XML then you will start to really get the power that we're all after in this knowledge-based world.
Mr. Lawrence: Tell us about tracking progress as you move towards those goals.
Lt. Gen. Boutelle: One is to be able to convert tremendous amounts of information into those protocols, into XML and those family of protocols, and that's going to be one part of it. The second piece is just start to apply that to the many, many, many hundreds, if not thousands, of systems that we have across the Army. Look, it's pretty easy to fix one system or mod one system or build one new system. But when you get a large organization like the Army, the Navy, the Air Force, the Marines, we have tens of thousands of applications and so we need to parse those applications and decide which we want to attack first.
We do have a requirement now that all new systems coming on board will use an XML back plane as part of that and we broke it out by domains. We have war-fighting domains, we have business domains, we have domain owners, and we are now assigning those domain owners responsibilities to modify those systems to operate within the XML environment. The larger environment is what we call the NCES environment, which is a Network-Centric Enterprise Services environment, which really the DISA organization is administering.
Mr. Lawrence: Let's take it down a level lower to the individual soldier. Could you tell us about Army Knowledge Online and how it affects their lives?
Lt. Gen. Boutelle: AKO or Army Knowledge Online, which is the largest portal in the Department of Defense, has several pieces to it. It has an unclassified portion which we operate, what we call the NIPRNet or the unclassified for day to day operations within the Army. It has a piece of it, the CIPR, which is the secret side, which is primarily used by our intelligence community, our war-fighter community, and our operations people, and then there's another side of it that are the websites open to the public.
For the individual soldier and family we have a tremendous amount of things that are going on. First of all, for any deployed soldier we offer the opportunity for him to provide guest passwords and access and collaboration sites to his family and kids. So a deployed soldier today can go to one of the many Internet cafes we have throughout the region in South America or other places and actually exchange e-mail and messaging and pictures and other things of their family and their kids and different events that take place within the family. That's on the personal side.
On the professional side if you go on Army Knowledge Online like I do every morning and I boot that system it provides me instant messaging to the people I work with around the world but it also provides me role-based things. Today when I boot on it's got a series of stoplights and said your physical is green but you didn't take your flu shot so it's amber or red. Go take your flu shot, you need a dental checkup, those types of things. So it is tied to many databases and systems throughout the nation.
Effective in October we'll really be role-based. Not only will it tell me that I need to take my physical or I haven't taken my flu shot but when you log into the system it'll be role-based. It will not only know about my physical and my flu shot but it will know what my role is in the Army and present information to me that's based upon who I am, what my age is, what my specialty is, what part of the world I work in, what my organization is, and start to provide role-based information for that individual. If he's up for promotion it should come up and tell him, okay, you have an opportunity for promotion here. You need to do these types of things to get ready for it.
Some of those are available today but we're going to pure role-based shortly. That gives us two things. It focuses information on the individual but it also makes sure that he or she does not have access to information that she does not need or is sensitive information that she should not have access to.
Mr. Prow: On the subject of knowledge management can you describe the Army's Battle Command Knowledge System and how this evolving knowledge management system will affect the Army's ability to fight wars?
Lt. Gen. Boutelle: The BCKS or the Battle Command Knowledge System is one of our very, very powerful stories. It's grown out of a couple young soldiers who decided that probably the big Army was not receptive and adaptive enough to do what they wanted to do, and they referred to it when I talked to them. They said we built the website companycommander.com, which was the original website, as if a bunch of company commanders were sitting around on somebody's front porch talking about how they operate every day and what works and what doesn't work as a company commander. And these young soldiers decided that a great thing to do would be put it on a website and they found that there was such a demand for sharing of information from company commanders in Korea and Alaska and Hawaii and South America and Europe it was an overwhelming success, exponential growth.
But they thought that because they did it on their own with their own servers that that was the only way to do it. And we worked with them for many years and we've now rolled that into a bigger program and that bigger program is BCKS. It does reside on Army Knowledge Online. It is now in the dot-mil domain. We're extremely pleased. We not only have the companycommander.com on the mil domain now. We've expanded that to platoon sergeants and battalions so that information is shared.
And when you start sharing that information and hopefully tacit information you have very, very powerful results. And so the young soldier who has an IED problem and a solution in Afghanistan when he was a company commander is now sharing that with a young soldier who's in Fort Riley and about to go to Afghanistan or Iraq. And so we're seeing all the sharing and collaboration of information; very, very powerful, very useful in our business.
Mr. Lawrence: Fascinating, especially the sharing part. Are military IT programs different from IT programs for civilian agencies? We'll ask General Steven Boutelle of the US Army for his perspective when The Business of Government Hour continues.
Mr. Lawrence: Welcome back to The Business of Government Hour. I'm Paul Lawrence and today's conversation is with Lieutenant General Steven Boutelle, Chief Information Officer and G-6, Department of the Army. Joining us in our conversation is Chuck Prow.
Mr. Prow: General Boutelle, you are considered a pioneer in the area of tactical communications. Can you explain the importance of tactical communications to our listeners and what innovations you expect to see that will positively affect the Army?
Lt. Gen. Boutelle: Great question, Chuck. The tactical communications world is a little bit different. In previous times prior to 1989 tactical communication was pretty much tethered to infrastructure within Europe, within Germany, where we thought we might have to fight a war with the Warsaw Pact.
Tactical communications today in a fight against a group of terrorists that have no alignment to a particular state or nation requires you to go into many of these fallen states or Third World countries or very poor countries, Afghanistan probably the third poorest country in the world. There is no infrastructure. There's no electricity. There's no potable water. There are no places to buy batteries for your radios. You have to bring it with you. There are no telephone systems, no cell systems, although they are starting to evolve cell systems in the bigger cities like Kabul, but you have to bring it all with you.
So when you bring it all with you and you have no electricity to plug into you get into the tactical world very quickly. And that is I have to be able to talk to someone either across the street, on the next mountaintop, or in the next valley and the way you do that are usually systems that are not readily available in the commercial market. They must be able to withstand the tremendous temperatures and weather environments that we operate in and that drives you to the tactical arena, usually it at the lowest level of FM voice and usually secure FM voice, and you move up for longer distances to what we call tactical UHF satellite.
That whole world of tactical arena is only somewhat applicable to the commercial world and usually pretty much customized to the work we do although we're seeing much more use of things like the 802.11 protocols b and g and some of the other protocols. We're starting to see a little bit of inroads to the commercial protocols. That's primarily the tactical world and it's really a stand-alone, sustaining, power it yourself, carry it on your back, or carry it in a vehicle if you can get a vehicle into a type of type of communications.
Mr. Prow: Information technology has and will continue to play a vital role in current operations around the world. What can industry to improve IT for the benefit of the Army and its evolution into overseas conflicts?
Lt. Gen. Boutelle: A couple things we need to think about. One, at the higher level, and this is really across the entire network, is information assurance piece. Let's face it. We're out there and we are an information-based Army and we are an information-based Department of Defense and federal government and that's a strength but it is also a weakness. And so tremendous amounts of resources and effort are being put into things like firewalls and anti-virus packages and packages that will push the IAVA updates across the battlefield to every computer. That's one piece that we really need industry's help on and it's a continuing thing. We can secure all of our networks today but the enemy has a vote be that a script kiddie or a local hacker or maybe a determined enemy on the 'net. So even though we secure our nets today that enemy will continue to try to attack and have better techniques and better tools in the future so you must continue to improve those information assurance things.
And the other piece is we need to push the envelope. When you're pushing people out in strange places in the world in a mobile and harsh environment the commercial product as it stands probably will not do the job. Much of the mobile computing came early in the armed forces. We were running mobile computers in helicopters and airplanes and tanks significantly before we had it probably in our house or were carrying out PDAs around. So as we continue to push that envelope we find higher demand for more bandwidth, to have higher resolution imagery, to see unmanned aerial vehicle streaming video. Those types of things will continue to push the industry on providing protocols and standards to give us those products in a timely manner.
Mr. Lawrence: Let's take a step back and think about IT projects in general. How would you compare and contrast, say, creating technology solutions in the military versus civilian agencies and the federal government?
Lt. Gen. Boutelle: In the military today, unlike 20 years ago, we don't create a lot of IT solutions. There was a time when the Army held and we still hold many patents but we actually created devices, we created radios, we created things. Now we rely heavily and we leverage the commercial community to do that. So I think you'll find that across the federal government that the Army by law is very much restricted and bounded by some things we do. We fight and win the nation's wars and so we focus primarily outside the continental United States.
Now, the National Guard under Title 32 does have a role within the different states and that's pretty much codified. So we focus outside. The National Guard focuses inside unless we activate and mobilize them and bring them with us. And the Reserve, of course, is part of the active Army in direct support.
So we really focus a little different, each federal agency, be it the Department of Homeland Security, the FBI, the CIA, really, which enclaves they focus in. The FBI is very centric to the United States. The CIA is outside the United States. The Army and the armed forces focus outside the United States. We have some role in certain occasions within the United States.
Mr. Prow: How do you see the Army's CIO/G-6 evolving in the years ahead?
Lt. Gen. Boutelle: The CIO role, as you know, has become increasingly more active in the last few years. A lot of that is because of the Klinger-Cohen Act. The Klinger-Cohen Act gives each agency very strong roles for the CIO, the chief information officer, to perform and that's codified in law. But I would suggest, and some of my CIO counterparts and brethren may not appreciate it, that at the turn of the century we had a vice president for electricity as we brought electricity into manufacturing plants. And so the CIO today will probably be here for 10, 20, 30 years but as IT becomes the common backbone of everything we do that will be an evolving role. I have no idea what that role will be 20 years from now but it will be significantly different today when we are initially bringing on IT services versus getting into knowledge management and where that goes. It may be more of a knowledge management officer than a CIO.
Mr. Prow: More generally where do you see the Army's movement over the next five to ten years?
Lt. Gen. Boutelle: I think the Army's movement is really networking the force to the lowest level. We can provide the transport network anywhere we want to today by brute force and resourcing. The issue we still have to solve and we have on the books and we're working on it very hard, and I believe it'll be solved in the next three to five years, is networking in the soldier at the lowest level or the special forces operator. That's the hard part. He needs a lot more bandwidth and he needs it in places where there is no infrastructure on this globe. That's the hard part, that's what we're working on, and battery technologies support it. It takes a tremendous amount of battery technology and lots and lots of batteries to support just about anything we do so power technologies to support those things in getting that large bandwidth out to the individual soldier or special operator.
Mr. Lawrence: You've spent the bulk of your career serving our country. What advice would you give to a young person interested in a career in public service?
Lt. Gen. Boutelle: I think the first thing I would do is it's like any other thing you want to do. If you want to get into something be good at what you do. You can take that niche, whatever niche you decide you have an interest in, and become the expert in that niche be it IP services, XML, whatever that may be. It's significantly different.
When I look across our population that we have in the Army, civilian and military and contractor, all three, I find a seam there age 30-35. If you're under 30 or 35 you probably grew up with IT technology, maybe just as a tool around the house. If you're over 30-35, if you've taken an interest in it or it was part of your job, you may become very good at it. If you're not into that business you need to make a concerted effort to learn some of these basic technologies about the web and IT services.
Great opportunities to do great things. It's very fast-moving. There are opportunities when you deal within the Department of Defense to get access very quickly to high-end systems, technological systems, systems used globally, technologies that are far beyond what you might be able to do in the public sector.
So I would suggest that a lot of this force is self-schooling, a lot of reading, a lot of time visiting different organizations and how they do business, but there are great opportunities in the civilian sector, in the Department of Army civilian sector, and also in the military sector in these technologies. It's in demand. It is something the Army needs and it is something our nation needs to empower those war fighters to do the things that are important for our nation in the future.
Mr. Lawrence: Well, that'll have to be our last question for this morning. Chuck and I want to thank you very much for joining us, General.
Lt. Gen. Boutelle: Thank you, Chuck. Thank you, Paul. It's been a pleasure.
Mr. Lawrence: Thank you. This has been The Business of Government Hour featuring a conversation with Lieutenant General Steve Boutelle, Chief Information Officer and G-6 of the US Department of Army. Be sure and visit us on the web at businessofgovernment.org. There you can learn more about our programs and research into new approaches to improving government effectiveness and you can also get a transcript of today's fascinating conversation. Once again that's businessofgovernment.org.
This is Paul Lawrence. Thank you for listening.
Thursday, October 21, 2004
Mr. Lawrence: Good morning and welcome to The Business of Government Hour. I'm Paul Lawrence, partner in charge of The IBM Center for The Business of Government. We created the Center in 1998 to encourage discussion and research into new approaches to improving government effectiveness. You can find out more about the Center by visiting us on the web at www.businessofgovernment.org.
The Business of Government Radio Hour features a conversation about management with a government executive who is changing the way government does business. Our special guest this morning is Ambassador Prudence Bushnell, dean, Leadership and Management School at the Foreign Service Institute.
Good morning, Ambassador.
Ambassador Bushnell: Good morning. How are you?
Mr. Lawrence: Great, thank you. And joining us in our conversation also from IBM is Kim Hintzman.
Good morning, Kim.
Ms. Hintzman: Good morning, Paul.
Mr. Lawrence: Well, Ambassador, let's start by finding out about your current position; I was intrigued as I introduced you. Could you tell us about this position?
Ambassador Bushnell: As you said, I'm the dean of the Leadership and Management School, which is one of four schools in the Foreign Service Institute. And our mandate is to provide both leadership and security training for the people in the Department of State, both those in Washington and those who are going overseas. It's a wonderful job.
Mr. Lawrence: How so?
Ambassador Bushnell: Because the Department of State is a global organization with 265 branch offices in 180 different countries employing 30,000 people of different nationalities with a mandate to create a more secure, democratic, and prosperous world with resources of no more than one percent of the U.S. budget. The job of me and my team is to help civil service employees and Foreign Service employees deal with the challenges of implementing that mandate. It is very complicated, very challenging, and very adventuresome.
Ms. Hintzman: Ambassador, that's very interesting. Can you tell us a little bit more about the brief history and overview of the Foreign Service Institute itself?
Ambassador Bushnell: Let me start by saying that the Foreign Service is actually a fairly new service. It was created in the '20s, the modern Foreign Service in the '20s, and the Foreign Service Institute was created in 1946, originally to provide people with economic training. Now when you think back of what the U.S. was doing in 1946, we were preparing to become a global power, we were looking at issues of the Marshal Plan, and helping Europe recreate itself, so it made sense that people needed to be economically savvy. Since then, however, the Foreign Service Institute has broadened to encompass a number of different issues. We're very well known for the 70 different languages to which we train, but we also provide a lot of trade craft courses, a lot of seminars to prepare people with children, spouses going overseas. So we are a full-service organization.
Ms. Hintzman: Great. So how is the creation of the school related to the evolving profession of diplomacy over the years? I think you started telling us a little bit about that. Can you expand on that some more?
Ambassador Bushnell: Diplomacy has changed tremendously, particularly since the end of the Cold War. It used to be that one could be a very, very effective diplomat as an individual player. You could make your reputation and do the government's business by your own individual actions vis-�-vis the government or the person whom you wanted to influence. As the U.S. became more of a global power, more and more federal agencies went overseas, and the role of the diplomat was not only to influence one-on-one, but also to provide leadership and a sense of direction to all of the other government agencies overseas. The Leadership and Management School is helping people to do just that, and it shows just how much more complicated our job has become.
Ms. Hintzman: Can you tell us what your vision is for the Leadership and Management School?
Ambassador Bushnell: I would like to see the school continue as a creative and dynamic partner to our colleagues who are implementing the very difficult mandate of creating a more secure, democratic, and prosperous world.
Mr. Lawrence: A lot of people talk about leadership and management together in one sentence. What are the key differences between the two?
Ambassador Bushnell: You know, I don't worry about that too much. Having spent a lot of time doing management training and leadership training, I think some of the differences are artificial. I think that it's more of a difference of emphasis. The leader, if you will, focuses on the direction; the manager focuses on getting there. Often you hear that leadership is doing the right thing and management is doing things right. You need both, in order to be effective either as a manager or as a leader.
Mr. Lawrence: And you don't focus on the difference between them because you think they're both important? I was curious about that comment.
Ambassador Bushnell: What is more important for me is to look at what behaviors go into leadership, because very often, I find that people want to wait until they're in a position of leadership in order to think that they're going to start practicing leadership. Well, if we all wait until we finally arrive at that position with who knows what as a title, without ever having practiced leadership behaviors, then we're not going to be very well prepared.
So what I would rather have people do is to look at what are the component behaviors of leadership. And it doesn't matter to me if you call them leadership or management, but what are the component behaviors? How can we practice them regardless of what title we have on our jobs or what position we occupy so that we can be ready for that stellar moment when we are crowned as leaders?
Mr. Lawrence: Well, do you answer the question for them? What are the component behaviors of an effective leader, in your opinion?
Ambassador Bushnell: I think the key behaviors are interpersonal skills, absolutely key. And when we train the leadership at the Leadership and Management School, we do it from the inside out, with the notion that leadership is not about you, leadership is about the other person. So you can't be so focused on how am I doing, how are people treating me, how do I need to behave. You really need to have a very good sense of yourself and a sense of discipline in yourself and managing your own behavior so that you can focus on the other person and lead the other person in terms of understanding the other person, motivating the other person, setting a sense of direction, and providing the environment that those people need to get their jobs done.
Ms. Hintzman: Tell us about your career prior to becoming the dean. How did your earlier positions help prepare you for your current position?
Ambassador Bushnell: I joined the Foreign Service 23 years ago, and before then, I had been involved in management training and found that when I came into the Foreign Service and went into the administrative work, there was a great deal of transferability of skills. It was very useful to know management concepts and procedures as I became a manager in an overseas context supervising people of different cultures. Since then in the Foreign Service, I've had jobs that entail both the practice of management and leadership as well as the theory and concept of management and leadership. So it's been very -- it's been a back and forth.
Mr. Lawrence: Tell us some more of those experiences. Take us through your career and how you got here.
Ambassador Bushnell: My first overseas position was in Dakar, Senegal, in West Africa, as management officer. Then I went to Bombay, India; came back to the Foreign Service to do leadership training at the Foreign Service Institute. I then went out as deputy chief of mission back to Dakar, Senegal. I have to tell you that the Senegalese who had known me when I was a lowly administrative person were thrilled to see me come back five years later in a senior job. They were just so proud of me. This is, you know, a general services officer made good.
From that job, I returned to the United States and served as Deputy Assistant Secretary, then Principal Deputy Assistant Secretary for African Affairs; went out to Nairobi, Kenya, as an ambassador, and from there to Guatemala as U.S. ambassador.
Mr. Lawrence: Now I also understand, in preparing for this interview, I learned that you recently received the Service to America Medal for your career achievements. Could you tell us more about this and why you were selected?
Ambassador Bushnell: The Service to America Medal is given by a nonprofit, nonpartisan partnership for government and the Atlantic Monthly media. And what they are trying to do is to highlight the contributions of public servants, so mine was not the only award. There were many other wonderful people who have done terrific things. And the purpose, as I say, is to highlight contributions of public servants and appeal to people to join the public service. Our nation, our government, I think, is as healthy as the quality of our public servants, and it's terribly important that people see public service as both a noble and a wonderful way to go in their lives.
Mr. Lawrence: I hope you told the Senegalese about this award.
Ambassador Bushnell: Yes, yes, I'm sure they'd be very, very proud.
Mr. Lawrence: That's interesting.
What does it mean to manage during a crisis? We'll ask Ambassador Bushnell to tell us more about this when The Business of Government Hour returns.
Mr. Lawrence: Welcome back to The Business of Government Hour. I'm Paul Lawrence, and this morning's conversation is with Ambassador Prudence Bushnell, dean, Leadership and Management School at the Foreign Service Institute.
And joining us in our conversation is Kim Hintzman.
Ambassador, as you mentioned in the previous segment, you were ambassador to Kenya at the time of the bombing in 1998. Could you tell us what it's like to manage during a crisis like that, during the attack, and the days that followed?
Ambassador Bushnell: Let me situate you. The embassy was in a very, very busy downtown area of Nairobi. The explosives amounted to about two tons that went off in this very busy intersection. Within a nanosecond of the explosion, 213 people died; over 5,000 people were wounded mainly from the chest up, which meant an enormous amount of blood; about 150 businesses were instantly destroyed; and a two-mile radius of the bomb site was devastated. We had, within five minutes, about 20,000 people on our -- in front of the embassy, because the building next door to us had completely collapsed. This was a seven-story building that pancaked. And windows in all of the buildings in our area had been blasted out.
There was no 9-1-1. This was a city that had a minimum amount of resources for itself in the best of times, and in the worst of times was completely inadequately prepared. What is different from what happened to us to what happened to people on 9/11 in New York, as an example, is that we, the victims, had to be our own rescuers. We had about 50 percent casualties in the chancery building, in the building that was blown up. The other 50 percent of the people came out onto the sidewalk, regrouped, and then went back into what was by that time a deathtrap of a building to bring out their dead colleagues, their wounded colleagues, and go under the rubble to find those who survived.
We went from there to finding the many, many people who were missing, because I did not want any of us to stop until we could account for every single person in the mission, both Kenyan and American. So we sent out teams to go through morgues, hospitals, neighborhoods to find our people. Meanwhile, we were recreating our embassy and an emergency action center at another building within town. There was, as you can imagine, a flood of media, a flood of attention. There was an inordinate amount of need on the Kenyan side, so we were trying to deal with the needs that the Kenyans had in addition to taking care of ourselves and recreating our community and our organization.
Most of the people, most of my colleagues, American colleagues, who had an opportunity to curtail from their assignment, choose not to. And even those who had been evacuated for medical attention returned, many of them with shards of glass still in them. Most of our Kenyan employees continued to work. And as a community, we reconstructed ourselves. We continued the bilateral business and recreating the bridge of friendship, which was sorely mangled at the point of the bombing, and we carried on. It was the most extraordinary lesson in leadership and exercise of leadership that I have ever gone through, and certainly changed my life and my thinking about what leadership is all about.
Mr. Lawrence: Well, tell us some of those lessons you learned and how your thinking changed.
Ambassador Bushnell: Let me give you an example. During the first few horrible, horrible hours, when we really were all by ourselves, before any rescuers from outside could come and help us I could hear on the embassy radio net everything that people were doing to help out to rescue our colleagues. And it created in me an incredible need to be worthy of these people who were doing so much. Some weeks later, one of them came up to me and said, geez, Ambassador, you know, we were really trying so hard to keep up with you. I said, well, I was trying hard to keep up with you. So there was this incredible synergy that was created.
And as I think about the leadership component to that synergy, what it was included a team of people who knew one another and trusted one another. Because I had spent a lot of time in the two years I was in Nairobi, before the bombing, creating teams and having us work together as teams. Being a team member and trusting one another doesn't mean you have to like one another necessarily, but trust and knowing how to accommodate one's work style was terribly important, so we had a team that was familiar with one another.
We had a leader. I had experience in crises as a result of having worked as Deputy Assistant Secretary for African Affairs. I had a fair amount of experience in leadership. And very importantly, I had a relationship with my team. They trusted me and I trusted them. And I think they knew they could depend on me as I knew I could depend on them.
And the third was a sense of mission that encompassed all of us. Failure was not an option. It was unacceptable; absolutely unacceptable to do anything but pick ourselves up and help one another get through what was a catastrophe. So team, leader, and mission to create this incredible sense of synergy where when one falters, the other can sort of pick you up temporarily and go forward.
Ms. Hintzman: The terrorist attacks on these embassies were front page news. How often are Foreign Service officers confronted with managing a crisis and we don't hear about it in the news?
Ambassador Bushnell: Very often. Part of the Leadership and Management School is a division called the Crisis Management Training Division. We recently did a survey of our colleagues overseas, all direct-hire Department of State personnel -- Civil Service, Foreign Service, and Foreign Service National, who work in our embassies overseas -- to find out just what experience with crises people have. And the crises we're talking about are crises as defined in our foreign affairs handbook, so we're talking hijacking, hostage, bombing, chem-bio, natural disaster, beyond the kinds of crises that we can get involved in, traffic accidents and family crises. So these are fairly, I think, major crises.
What the survey came back with was that 67 percent of our people overseas have either been a victim of or involved in resolving a crisis. When you talk about the population within the Foreign Service, the population of generalists with 15 years experience or more, that number goes up to 87 percent. So what I learned recently is that who we are, as Secretary Powell says, is on the front-line of offense, truly are the Americans with our Foreign Service National colleagues who are facing incredible dangers that are becoming more and more serious every day.
Mr. Lawrence: I understand the Leadership and Management School has a course about crisis management. Could you tell us about that course?
Ambassador Bushnell: In part because of this incredible statistic, I have to tell you that all of us who worked at State and are in the Foreign Service acknowledge that we deal with crises and we have sort of taken it for granted. We also recognize that we had jolly well better prepare ourselves, so the handling crises and dealing with personal security permeates many, many of the courses in the Foreign Service Institute. It is mandatory, for example, that every employee of the U.S. Government goes through a security course, and we actively encourage spouses and children to go through that personal security course as well.
In addition, the crisis management team which I mentioned to you that works within the Leadership and Management School travels to literally all parts of the globe to exercise 50 percent of our embassies every year. So these people create post-specific scenarios, then go to the posts and work with the emergency action committee of the United States' mission, the Americans and the national employees, to go through a scenario and help them become better prepared. Every two years, 100 percent of the posts in the world will have gone through a crisis management exercise, and we will exercise posts more frequently if they need it.
In addition, we recently created a crisis leadership training for senior leaders. And what this does is to extract from the array of management and leadership skills that are useful at any time those specific skills that are needed in times of crisis, and we train people specifically to those skills.
Mr. Lawrence: That's interesting, especially the part about the training specifically for that.
What does one do when their job description includes promoting democracy? We'll ask Ambassador Prudence Bushnell to help us get a better picture of what a Foreign Service officer does when The Business of Government Hour continues.
Mr. Lawrence: Welcome back to The Business of Government Hour. I'm Paul Lawrence, and this morning's conversation is with Ambassador Prudence Bushnell, dean, Leadership and Management School at the Foreign Service Institute.
And joining us in our conversation is Kim Hintzman.
Ms. Hintzman: The Leadership and Management School gets people joining the Foreign Service from all sectors, as well as those already within the Department of State. How many non-career ambassadors join the Service, and how does the school help them to acclimate more quickly to their foreign posts?
Ambassador Bushnell: About one-third of our ambassadors overseas are non-career people, and this has been a tradition since the Founding Fathers created the United States of America. One of the challenges that I have, an absolutely delicious challenge, is running the ambassadorial seminar, which helps people who are going out to be ambassadors, be they from the career service or non-career service, anticipate and plan for what they are going to be doing.
We spend a day with our non-career colleagues specifically orienting them to the culture and the language and the acronyms of the Department of State. And then in the two-week seminar, they interact with their career colleagues looking at some of the issues that are going to be facing them. And my job is to help everybody, both career and non-career, look at what kinds of skills they have gained in their past and how to transfer it to the context of a chief of mission.
Mr. Lawrence: I understand that one of the career tracks that a foreign officer might select is political, where he or she may be asked to promote democracy and the rule of law in developing countries. How does one go about promoting democracy?
Ambassador Bushnell: Easier said than done. You know, for most of us, we tend to think of democracy as a concept and as a theory. For us overseas who have the job of promoting democracy, it is real and tangible. So one of the things that we do is look at what do we mean by promoting democracy, and what is going on in this country in which we are currently located? Democracy essentially is citizen participation. That's one way you can look at it.
Let me take you to Kenya, where I was for three years, and where we went through an election. When we looked at promoting democracy, particularly going up to a presidential election, we were looking at citizen participation. Who's participating? Are women participating? Only 50 percent of the population; very little participation. So when promoting democracy in Kenya, going up, leading up to the elections, we placed a lot of emphasis on working with women, getting women to recognize their political rights, their legal rights, and encouraging them to participate in elections. And in fact, there was a woman who was running for president.
We did a lot of work on election monitoring among Kenyans so that they could monitor their own elections. That was very different from Guatemala, where I next served, where a lot of the issues we were dealing with were rule of law issues. And again, rule of law seems theoretical and pie-in-the-sky. And what we tend to do is to look at, again, the circumstances on the ground to see where can we move in and help create a better system.
One of the things we found, for example, in Guatemala, is there was a great deal of confusion on a crime scene or any scene as to who would do the investigating. The prosecuting attorney's office had investigators and so did the police. The result was that the evidence was often tampered with and was absolutely useless in a trial. Therefore, one of the aspects of promoting rule of law was trying to get the attorney general's office and the police to have a memorandum of understanding about how to treat evidence.
Things that seem, as I say, very theoretical can turn into very, very practical issues. And you take it one step at a time, depending upon the circumstances that you find, and those circumstances are different with every single country.
Mr. Lawrence: What management tools do you use to do that? I was thinking of the example where the two people with the two investigators. I mean, how did they come to figure out there should only be one and one person would be in charge of it?
Ambassador Bushnell: Well, that's very difficult, particularly since the issue was between two branches of the Guatemalan government, and here we are, the gringos, you know, stepping in and saying, okay, why don't you all do it our way. Actually, it's not just a management tool, but it's a training tool. How do you sit down with people and get them to see where the differences are in their approach, where the commonalities are in their approach, and how essentially they can get to yes. And what we did, what I did a lot as ambassador, was essentially facilitating. I do that a lot as a trainer. And I think that the skills of listening, active listening, the skills of finding commonalities are skills that are very important to managers, leaders, and diplomats.
Mr. Lawrence: How about promoting democracy in different cultures? You gave the example where people were unused to perhaps women voting, and working through that. But how about where they have a history of conflict and losing is probably, you know, resolved different ways than sort of acknowledging the winning as we do in elections? How do you promote democracy in a situation like that?
Ambassador Bushnell: It becomes even more complicated, because what conflict does is increase a state of mistrust. And if you think of democracy and participation, it's also power sharing, right? I am sharing in the power with my government. Conflict, on the other hand, is generally viewed as win-lose. I win, you're dead. That is not exactly power sharing, nor is that conducive to the kind of trust necessary for a democracy.
In a lot of countries, the step to promote democracy after conflict is one of reconciliation, where people recognize what happened and come to grips with what happened so that they can then move on and create a democratic culture. And it has worked. If you look at South Africa, for example, it has worked in South Africa. It has worked in Salvador.
In other countries, it's much more difficult. You certainly need, I think, a national consensus that we have got to come to peace with one another. And you need, I think, the leadership that is going to promote the kind of open and transparent systems that allow people to have some trust in the use of those systems.
Ms. Hintzman: Since development issues, environmental factors, and historical context can be so different from one country to the next, how does a Foreign Service officer translate his or her past experiences and apply them to new challenges?
Ambassador Bushnell: There are certain skills that a Foreign Service officer has that can be taught. Language, of course, is one of the most basic ones. Before I went to Guatemala, after my tour in Kenya, I spent two months, eight weeks learning Spanish, six hours a day, one-on-one. There was no place to hide. Now if I felt like speaking Spanish or not, I did. I was very motivated, because I kept having the thoughts of an ambush press conference, and there's nothing like the thought of appearing stupid on television to make you want to learn a language and be a little smart.
So we teach languages as the Foreign Service Institute. We teach all kinds of trade craft courses. What we don't teach and what you can't teach is experience. And I think that people in the Foreign Service learn how to go into a different culture and observe and see what works and where they fit. And that is very, very important and something that you just get as a result of doing it from time to time. In many respects, it comes down to strategic thinking.
Mr. Lawrence: You've talked about promoting democracy and rule of law, sort of taking a very theoretical thing and making it practical. How do you measure the performance of how effective we are at doing those things?
Ambassador Bushnell: By becoming very practical about it. We have a system in the Department of State of starting with strategic goals and moving them all the way down to performance indicators. So every single embassy overseas and every bureau in the Department of State has a program plan which is created and reviewed every year. And from that program plan, employees create their work requirements and their work objectives for the year with the performance indicators tagged to the performance indicators of the mission program plan.
Mr. Lawrence: That's interesting.
Should other organizations establish a Leadership and Management School? We'll ask Ambassador Bushnell for her perspective when The Business of Government Hour returns.
Mr. Lawrence: Welcome back to The Business of Government Hour. I'm Paul Lawrence, and this morning's conversation is with Ambassador Prudence Bushnell, dean, Leadership and Management School at the Foreign Service Institute.
And joining us in our conversation is Kim Hintzman.
Ms. Hintzman: Ambassador, how does the Leadership and Management School measure the success and impact of its programs?
Ambassador Bushnell: I think that's a difficult challenge for anyone engaged in influencing human behavior, because there are so many other factors involved. We always have evaluations immediately after our training events. We often do impact evaluations a few months later, but this is self-reporting. And it's wonderful to get kudos and it's wonderful to hear people say yes, I'm an even better employee than I used to be. Is that true? We start looking at anecdotal evidence to see whether the culture is changing.
The culture of leadership in the Department of State is something that we are promoting, so it is more than simply people's reactions to the training, it is what happens on the job, because that's where it's important. It's great that we deliver a good product, and we do. What I'm interested in is what is happening at work. Are people changing the way they behave toward one another? Are they becoming more effective? Are they creating teams? Are they leading better?
I think that we are seeing some changes, as indicated through conversations we have with our Inspector General, with the people who serve on promotion boards. And I think that obviously, as in any change effort, we have a very long ways to go.
Ms. Hintzman: Do you think the model of the Leadership and Management School should be emulated by other organizations, both in the private and public sectors?
Ambassador Bushnell: I think it depends very much on their population and what they are trying to do. Our training is exceedingly pragmatic. We take people for a very short period of time. We have very focused training that is immediately applicable to their work. We just don't have the numbers of people or the time to spend a great deal of hours on concept. We also have a very smart population, so they get it. So our focus is not just on talking about the importance of listening, that's sort of a no-brainer, but, okay, now you go through the practice of listening--very practical.
That works for us. I think each organization needs to decide for itself what is going to work for its own population.
Mr. Lawrence: My observation is people's perceptions of foreign policy and the role in the U.S. and in global conflicts change over time. Looking back on your career, I'm struck by the fact that 10 years ago, many people dismissed your efforts to keep America's attention focused on the conflict in Rwanda, and today you're being honored for these same efforts. What changed?
Ambassador Bushnell: One of the lessons I find is that I have asked myself the same thing, you never know what you do that is going to make a difference in hindsight. So what I tell a lot of people is if you are in a position of leadership, just do the right thing, because you'll be able to face yourself in the mirror later on; and, who knows, since you don't have any choice as to how you will be judged, do it and you might be judged properly.
I tried to do the right thing on Rwanda. What happened is people looked back as historians, looked back at this extraordinary genocide as political leaders, such as Bill Clinton, looked back on it. They saw that a lack of engagement helped to facilitate people who wanted to murder their fellow citizens, and that made us think twice. And I think if you look at our response to Sudan and our response to Rwanda, you will find a great difference.
Mr. Lawrence: It will probably seem obvious to historians what should have been done, but how hard was it to do the right thing when nobody else seemed to be going along?
Ambassador Bushnell: Well, actually, you know, I have to tell you that for all of the efforts it wasn't just me, there were a number of us who were exploring ways to stop the killing within the parameters of our policy -- we were not successful. We tried to be very, very creative in what we did, because the policy was that we would not provide people or resources to stop the killings. So we were using the press. I was telephoning senior people in the Rwandan government. How much that did, I don't know; I don't think it did a whole lot. But the lesson for me is that you do what you can do. There is just so much we cannot control, but we can control our own behavior. And even if somebody else isn't doing what we think is the right thing, we can do the right thing.
Ms. Hintzman: How do you envision the profession of diplomacy changing five or ten years from now?
Ambassador Bushnell: I think it's going to continue to change as dramatically as it has changed in the past five years. We have gone from a profession that essentially looked at very narrow issues between governments to a profession that deals with an array of complicated subjects: from fighting HIV/AIDS and poverty and promoting democracy; to looking at terrorist financing and helping United States business create new markets with constituencies that become ever more interested and involved in what we do. So now we are not just interacting with governments, we're interacting with nongovernmental communities; we are interacting with business communities, with faith-based communities. Our jobs become far more complicated, the issues become far more complicated, and the numbers of players become far more numerous, which takes me back to where we began. This is why the skills of diplomacy become important, but so do the skills of leadership, because really, every diplomat now has leadership behaviors which will serve him or her well.
Mr. Lawrence: You've had a long career dedicated to public service, so I'd like to ask you to be reflective in this last question. What advice would you give for a young person considering a career in public service, say, in general, and international fields specifically?
Ambassador Bushnell: I would like to see resurgence among young people in public service. I think I mentioned earlier that the quality of a society and of a government to me is directly related to the quality of public servants. Having served in developing countries, I have seen what happens when you do not have, when you cannot depend on a good civil service group. So I would encourage people to join the public service. I looked up the website: usajobs.opm.gov is the website. For federal employment and for international employment in the Department of State, it's state.gov. Go on the website and you will find an array of adventuresome careers awaiting you.
Mr. Lawrence: Well, thank you very much, Ambassador, for squeezing us in your very busy schedule. Kim and I appreciate you joining us this morning.
Ambassador Bushnell: Thank you.
Mr. Lawrence: This has been The Business of Government Hour, featuring a conversation with Ambassador Prudence Bushnell, dean, Leadership and Management School at the Foreign Service Institute.
Be sure and visit us on the web at businessofgovernment.org. There, you can learn more about our programs and research into new approaches to improving government effectiveness, and you can also get a transcript of today's fascinating conversation. Once again, that's businessofgovernment.org.
This is Paul Lawrence. Thank you for listening.
Tuesday, September 28, 2004
Mr. Lawrence: Good Morning and welcome to The Business of Government Hour. I'm Paul Lawrence partner in charge of the IBM Center for the Business of Government. We created this center in 1998 to encourage discussion and research into new approaches to improving government effectiveness. You can find out more by visiting us on the web at www.businessofgovernment.org.
The Business of Government Radio Hour features a conversation about management with a government executive who's changing the way government does business. Our special guest this morning is Kim Nelson. Kim is the Assistant Administrator and Chief Information Officer at the Environmental Protection Agency. Good morning Kim.
Ms. Nelson: Good morning.
Mr. Lawrence: And joining us in our conversation also from IBM, is Dave Abel.
Mr. Lawrence: Good morning Dave.
Mr. Abel: Good morning Paul.
Mr. Lawrence: Okay, let's start by talking a little bit about the EPA. Could you give us a historical background of the EPA and explain its mission to our listeners?
Ms. Nelson: The Environmental Protection Agency I think is an organization that most Americans recognize. It was created back in 1970, right around the time of the first Earth Day, and it was created as America was really getting an interest and awareness of the environment. Everybody wants clean air, wants safe drinking water, wants land that's clean to live on and living communities that are safe for our children to grow up in. And therefore EPA was created to help provide that kind of mission for the country.
Mr. Lawrence: Could you talk to us a little bit about the EPA's interaction and relationships with other Federal departments and agencies.
Ms. Nelson: Sure, you know, when people think of the environment often EPA is the first agency that comes to mind but really there are many Federal agencies that have some kind of responsibility for protecting the environment. For instance, the Department of Interior manages over 500 million acres within the country. In fact one-fifth of all the land in the United States is managed by the Department of Interior through their park service and through national lands. Likewise the Department of Agriculture manages all the forest land within the country that is owned by the government. And you have a handful of other agencies that also some kind of environmental responsibility. So in doing our mission we have to work with many other Federal agencies.
Mr. Lawrence: How do you describe the size of EPA's budget and its number of people?
Ms. Nelson: EPA is a fairly large agency, even though we are an agency and not a department. We have almost 20,000 employees across the country. We have a headquarters that's rather large here in Washington but we also have 10 regional offices across the country and I really think that's where the rubber hits the road in terms of EPA working with states, working with local governments, and working with tribes to fulfill our mission.
Mr. Lawrence: And how about the skills of the people, as you were describing the environment, I began to think about the scientists and the like, maybe you can describe the capabilities of the team?
Ms. Nelson: Well, we certainly do have a lot of scientists and more and more I think one of EPA's core missions is in the research area. There are lot of questions that are still unanswered to us today. Even 30 years -- more than 30 years after the agency was created, there are so many answers that we still don't have today. Particularly answers like linkages between environmental conditions and health conditions so certainly the science is an important part of EPA's mission.
In addition we have a lot of engineers. We have enforcement officers, lawyers. We have people who analyze programs trying to ensure that we're achieving the results we want to achieve. So we have a broad array of different kinds of people working at EPA with different backgrounds and skills. In my own office, I'm in the Office of Environmental Information of course.We have tremendous focus on technology and therefore the -- the skillset that we have in my office has more of a focus on technology, information science, information management, librarians, people who know how to access information, display information, disseminate it; people who use geospatial tools, a lot of people with geography backgrounds because that's an important part of how we share and display information.
Mr. Lawrence: Let's talk a little bit further about the responsibilities of your organization. What are your responsibilities and duties as the Chief Information Officer?
Ms. Nelson: Well, that title Chief Information Officer is one that is probably widely known to a lot of people who work in the private sector. For government, the term is relatively new. I will say particularly coming from State government. And here in the Federal government back in 1996, the Clinger-Cohen Act was passed and under that act certain large agencies were required to create a Chief Information Officer position. That position as envisioned by the law was to be created in such a way that many companies, large companies in the private sector created CIO positions. The position for instance is to report to the head of the agency. There was a real acknowledgment at that point in time that the use of the information was a powerful tool to the Federal government.
The Federal government was making a tremendous investment of billions of dollars in information management, information technology tools and therefore they felt that the CIO who has authority generally across an organization to make investment decisions and technology decisions was a wise position to have in the Federal government.
Mr. Lawrence: You mentioned background in the State government. Can you tell us about your previous experiences before becoming CIO?
Ms. Nelson: I have been in Washington now for three years, before that I worked for 22 years in the State government. I held a variety of positions. Interestingly enough I spent 22 years as an at-will employee or as a political employee, never having a civil service position. I believe that sort of gave me the desire everyday to get up and do an outstanding job because I didn't have civil service protection. I started in the Senate of Pennsylvania as a Legislative Aid. It was a tremendous way to get experience of the State government at large, everything that happens in the State government. I left there and I went to a regulatory agency, the Pennsylvania Public Utility Commission and I worked for the Chairman of the Public Utility Commission.
There I think I really got interested in regulatory issues. I was there at a phenomenal time. I was there during the accident at Three Mile Island. I happened to live just outside of Harrisburg, when that accident occurred and much of the work we did then was dealing with the aftermath. The clean up there, the cost associated with it. I was there during the break up of the 18 bell companies. Again it was an interesting time in the regulatory arena. I left there and spent a short amount of time working in Governor's Office Administration, the Department of Ageing and really recognized that I want to get back into a regulatory environment and went to work for the Department of Environmental Resources. I spent 14 years working there before I came to EPA. And it was there at the department of environmental resources where I was tapped to be the first CIO ever for that particular agency.
Mr. Lawrence: So how -- how did these experiences together help you to be able to prepare for the responsibility that you now have in the EPA?
Ms. Nelson: I come to this CIO position perhaps a little bit differently than a lot of people. I don't have an IT background. I don't have a degree in information technology, computer science information management. My bachelor's degree is in secondary education and political science. My master degree is in public administration. I cannot be jobbed really from a management perspective saying what does a manager need to do for their job by way of information and it was very apparent back then in our environmental agency. We didn't have the kind of information we needed to know, whether we're doing good or not. We couldn't compare one program to the other in terms of were our facilities in compliance with our laws.
We didn't have information to really tell us whether the air was getting better, the water was getting cleaner. So we didn't have the kind of management information we needed to always make the best management decisions in terms of where our resources should go or how our budget should be allocated. And that's what drove me into this field, which was to say how do we as an organization then start to collect the right information to use for management purposes.
Mr. Lawrence: You mentioned the management information, I want to take you back to compare some of your State experience with your Federal experience. Give us a sense of you know, how would you compare the different management approaches at the two levels of government?
Ms. Nelson: Well, it's funny you should ask that question Paul, I was testifying before the Congressman's Putnam's Committee and at the tail end of the hearing he asked that exact question, how would I compare my State experience with my Federal experience. There're many, many similarities: the mission of our organizations are similar, the demands that we have from the public are similar, the challenges we face are similar. The one thing that is very different here in the Federal government is the focus on information technology and information management from so many areas.
The Federal -- the State government, excuse me, it almost happened unnoticed but here in the Federal government there's a tremendous amount of interest from Congress. You know, I've testified a half a dozen times already before congressional committees. I never did that in the State government. There wasn't that kind of interest from the general assembly. The General Accounting Office, the number of audits that my office goes through from the General Accounting Office again is another indication of the inspector general, the OMB all of that oversight is very, very different here in the Federal government than what I ever experienced in at least my own State government career.
Mr. Lawrence: And how about the speed of decision making, how would you compare the two levels?
Ms. Nelson: The speed of decision making, I think, depends on the nature of the decision that has to be made. There are clearly some instances where I could point to my own State career where I was able to make a decision on the spot and have that implemented, but here in the Federal government so many of those decisions are in fact covered by regulatory requirements that a decision that was very simple in State government that I made on my own and had implemented within 24 hours, actually here in the Federal government would take a rule making, or would take years to implement.
Then again there are many other decisions where we can make them just as quickly here and that's not the case so it really depends on the nature of the decision although in general there is more bureaucracy here and more red tape and it is more difficult to get things done.
Mr. Lawrence: It's an interesting point especially about the speed and the different issues. Information collection and dissemination is a big part of what the EPA does, what are the management challenges in doing this? We'll ask Kim Nelson of the EPA for her perspective when The Business of Government Hour continues.
Mr. Lawrence: Welcome back to The Business of Government Hour, I'm Paul Lawrence and this morning's conversation is with Kim Nelson. Kim is the Assistant Administrator and Chief Information Officer at the Environmental Protection Agency. Joining us in the conversation is Dave Abel.
Mr. Abel: Kim, the Office of Environmental Information or OEI has numerous responsibilities including the collection and dissemination of environmental information with external stakeholders. What kind of data does your office collect and how do you use it?
Ms. Nelson: Dave, let me just do a minute on what the Office of Environmental Information is about because I think that's important. Next month, October we will be celebrating our 5th anniversary as an office and it was created solely for the purpose of recognizing that EPA did not have the information it often needed to manage its programs. So if you look at the Office of Information, of Environmental Information, we have a broad spectrum of responsibilities. And they almost follow the lifecycle of data, how you collect it, how you store it, how you disseminated it. One of those key responsibilities is information collection and what's really fascinating is EPA is a little different from most Federal agencies and that so much of the Federal law is delegated to States and tribes.
For instance if you take our major air, water and waste management programs, those programs are all delegated for the most part to our states. That means 95% of the information in EPA's computer systems comes from the states. So for us a large challenge is how do we collect that information from our state partners, our tribal partners in a way that's a standardized format that allows us to then aggregate the information in a way that's valid so we can get the national picture. So a core part of what we collect is from our state partners. We also though have some direct regulatory responsibilities with facilities.
For instance in my office of Environmental Information, we have something called the Toxic Release Inventory program that requires facilities once a year to submit a report directly to EPA that tells us how much material they have released to the environment either the water, the air, the land that's of a toxic nature. Those reports come directly to us for tens of thousands of facilities across the country. So there's information collection requirements span, municipal government, tribal government, State governments, and facilities.
Mr. Lawrence: It seems to me with the delegation of responsibility for the collection of so much data the quality assurance has to be a big concern for your -- for your organization. What type of quality assurance programs are in place or under way to make sure that the data that's collected is both accurate and reliable?
Ms. Nelson: It's a huge issue for us in fact, last year for the first time EPA put on the street, last June what we call a draft report of the environment. It's hard to believe with the agency having been in existence of over 30 years, last year was the first time we ever put a report out to the public that told us what we knew and didn't know about the condition of the environment. And in some respects we couldn't answer those questions because the quality of the data wasn't high enough to provide answers that we thought were scientifically valid. So data quality is a huge issue for us.
One of things we've done is, we work very closely with States and tribes on data standards, because one of the things that's important is when we aggregate the data we're not mixing apples and oranges--that we all have the same definitions and standards. So about 5 years ago we started a data standards counsel with State, tribes in EPA and that's been very successful. We've worked through some really tough issues like how do we identify facility, what we call chemicals, what are our biological standards, permitting of standards, enforcement of standards, what do you call an inspection, and what do you call an enforcement action. They are important decisions because when we aggregate that information across 50 states we have to have the right picture. That's an important step we've taken.
We also have, I think a very good quality management program with EPA. All of our programs have to have quality management plans for all their information systems. And this year for the very first time we actually have every program in EPA with an approved quality management plan in place and I think that's -- that too is a big step. The last thing I'll just say we're doing is we know data collection is important to EPA. We know we collect data from a lot of different sources and one of the most important things we can do to improve the quality is make sure it's right before it ever gets to us. So we're putting in place a lot of validation techniques.
For instance we have our central data exchange. That's our portal, the single point through which all data will be received by EPA in the future and built into CDX are the tools and the technology to help ensure the highest level of data quality as those reports or submissions are being received. And we have seen for instance just this past year, our toxic release inventory reports. We know that when people submit those electronically over the internet through a central data exchange, we see a 25% higher rate of quality in terms of errors coming in the door than we see on paper reports, so we know it works.
Mr. Lawrence: Well, better data in clearly means better information out. Once you've collected the data what types of products are produced? Can you give us a couple of examples of how EPA actually uses the information once it's been collected?
Ms. Nelson: Boy, the examples are limitless. I'll go back to the one that I just mentioned because it's one of which I'm so proud and it's last year's EPA's draft report on the environment, again it's hard for me to believe, an agency of our size, an agency that has budget of almost a billion a year has never been able to tell the American public what we know about the environment and what we don't know. That was really an initiative of Governor Christine Whitman's when she came on board. She pledged that before she left she would give the American public what she liked to call the report card about the state of the environment and we were able to do that.
We are now working on our second report card and that's really fashioned in a way that's easy for the American Public to understand, based on some common questions, like is my water safe to drink, are the fish safe to eat, what's the condition of indoor air and what contributes to bad indoor air. The kinds of things that effect, you know, you every day or as a parent you are concerned about. That's one important tool we use. Another is getting information out to the public on our website. My office is responsible for managing our website and I think EPA has one of the most impressive set of tools to share with the American public about what we know about the environment today.
One of them is windowed in my environment--a very simple tool on our website. Go in and put your zip code in and we will tell you based on your zip code everything we know about that part of your community. What facilities are there that we regulate, what we know about their discharges what we know about their permits and violations, it's all right there in one place.
Mr. Lawrence: In addition to the public who are some of the other stakeholders that use the information and how do you make information available to them?
Ms. Nelson: Well one of -- certainly in an audience that we're concerned about, we work with closely are other decision makers throughout the United States. Certainly EPA with its 18,000 employees we recognize we're not the only environmental professionals out there and without environmental decision makers at the local level and local governments, at county levels, in state governments, in tribes. So one of the things we try to do is make sure that as decision makers across the country, we all have access to the very best information, because we're spending, you know, cumulatively between states and EPA we're spending over $20 billion in tax payer money. It's important to have the right information to make sure these dollars are being spent wisely.
Mr. Lawrence: You mentioned the Environmental Information Exchange Network. Could you tell us more about this, the history of how it came into being and how it works?
Ms. Nelson: Well as I talked about it earlier, EPA is an agency where our responsibilities are so highly devolved down to the state that it became apparent if we were going to do our job as co-regulators we really had to be in a partnership in sharing information and we -- the world at the time was such that states were spending more and more money on their own information systems. They weren't relying on EPA's information systems, which were becoming more outdated. States were building their own information systems and actually building integrated information systems. So it was important we partner with them to share the information. I think that the network is based on a very -- you know some very simple concepts.
And one is the e-commerce concept. We recognized that the world was changing and technology was bringing to us the ability to use the Internet and standard e-commerce tools to our advantage. Things like data standards, trading partner agreements for companies that were sharing information--they were being used for the same reason we needed to be able to use those. So, the technology was evolving and we could rely on the Internet.
The second core concept was, as I mentioned earlier since 95 percent of our information comes from the states, it's important that the states be the stewards of their own data. If you have to maintain two different information systems, one for EPA and one for yourself, which one's going to have the highest quality data? The one you're using, not the one you're feeding to EPA. So it was important we eliminate this duplicate system and ensure that the states were in fact the stewards of their own data and that they collected the data and kept the data and that they kept it up to date and accurate and only provided access to EPA of the data we needed. So this is about states, EPA, stewarding their data, making sure what we collect is of very high quality and then sharing it. So what our network does is encourage everyone to put a node on the network using common standards and technology and on that node you would place data that you want to share with other people.
They maybe openly available or it may only be available through a trading partner agreement. But that data then is data that you own, you decide to share, you decide with whom you're going to share it and what the conditions are in terms of sharing that data through a trading partner agreement. And we're seeing as a result of that higher quality data, more accurate data, more timely data being available for decision makers.
Mr. Lawrence: That's a very interesting point, especially about the reduction and the redundancy. Technologies used to drive EPA's operations. How is the EPA addressing issues such as interoperability and enterprise architecture, we'll ask Kim Nelson of the EPA to take us through this when The Business of Government Hour returns.
Mr. Lawrence: Welcome back to The Business of Government Hour, I'm Paul Lawrence. This mornings conversation is with Kim Nelson, Kim's the Assistant Administrator and Chief Information Officer of the Environmental Protection Agency. Joining in our conversation is Dave Abel.
Mr. Abel: Kim, we spent the last segment talking about the information that you collect from external stakeholders and the reporting and analyses you do against that information. But you're also responsible for the technology that derives the operation within EPA. Can you give us an idea of what that entails and what your office is doing to promote efficiency and interoperability within the organization?
Ms. Nelson: The OEI has many of the traditional responsibilities and as the CIO, you would expect to find in terms of managing operations within an organization. For instance we're responsible for providing secure access to our network and that includes thousands of applications and all of our databases. Some are very sophisticated scientific computing and now with good computing and communications, so that's pretty standard but we're really evolving into a lot of the new or super computing and good computing areas that are -- I find very exciting particularly in partnership with our researchers in the organization.
One thing that is I guess we're very fortunate in EPA and as I talk to my colleagues I recognize more and more we're fortunate, EPA has the entire organization on an agency wide e-mail and Lotus Notes system. I'm shocked when I talked to my colleagues in other federal agencies and realize they're still using multiple e-mail systems but we are using this efficiencies and we're talking earlier about how we're using SameTime and those Lotus Notes and collaborative tools to help us manage the organization and work more effectively. I find that very exciting as people are discovering the potential there. Security is a major issue for us as it is in all organizations. We've come a long way in security in this organization.
Four years ago EPA actually had to shut down its Internet access because there were so many potential security breaches acknowledged in the GAO report. We've reached a point now where last year in the President's budget EPA was cited as "the model" for having the best security program within the Federal government. So we still have many challenges ahead of us, there are still a lot of work in terms of what we have to do in management operations, there are some of the things we do on the internal side, on the external side I was talking earlier about for instance, central data exchange. Managing that project and running that operation for users on the outside is very important to our relationship with our partners.
Mr. Lawrence: One of the topics that we normally interact with -- we talk to CIO's on these shows and elsewhere as enterprise architecture. I know it's a very complex subject. Could you describe the value of the enterprise architecture at the EPA?
Ms. Nelson: You know, enterprise architecture is an interesting term and I have learned in 3 years in the Federal Government that we all may be better off if we stop using the term enterprise architecture because after so many years there are still so many people who find it very difficult to understand. And I'm not sure why because to me, all enterprise architecture is, is a very basic blue print or a picture. It's being able to describe graphically the business of the organization so that you understand the business of the organization and you can make the best resource decisions for your organizations in terms of where you put your people, where you put your technology, where you put your money in terms of providing tools for your organizations and solutions.
So it's been an interesting journey over the last few years. So I've learned to stay away from the term and my goal over the next year is actually to -- not use those words "enterprise architecture" but to focus solely on business results. What are the solutions we need to put in place to ensure the business results of the organization and that's understanding our strategic goals and making sure that we're investing our dollars to achieve this strategic goals.
Mr. Lawrence: Well with the blue print and understanding the business results, have there been any new technology initiatives that have happened as a result of sort of putting those two together?
Ms. Nelson: Oh clearly, I think as we look for instance to build our portal one of the things we're trying to do is look at our shared -- what I'd like to call shared services. What are the things we want to build one time in EPA, share with the rest of the organization, in other words build once use many and our portal will do that. What we envision through our portal is to have that single place where people outside the agency can come who are co-regulators, people inside the agency to access the information they need. So we're building the core share services that are identity management, security, and our backend registries that will house the information that people most often want to get out of our databases. It is the tools to manipulate that data, to actually extract that data, manipulate and display it.
So for instance, that then becomes an implementation of our enterprise architecture because we're building a solution one time and we're providing that for many people in the organization. It meets the strategic goals of the organization it reduces duplication, and it helps get information in the hands of people as quickly as possible and very high quality information.
Mr. Abel: So we've talked quite a bit about what can be competing priorities. There are the priorities of the external stakeholders, information sharing consortium and there's priorities of the internal stakeholders managing the business of the agency. How do you balance the requirements between those two groups of stakeholders?
Ms. Nelson: Well if you do it right and you establish your priorities you can often find that a solution that you're putting in place to meet your external customers often meets your internal customers. For instance, recently and I've talked a lot about central data exchange, but it's really interesting when you develop a solution and you develop a solution that's built in such a way that it is sharable and usable and scalable. With our central data exchange we recently put that in place, while we built that originally as you know for communication with our state partners and our tribal partners.
We recently put that in place as a backend service for one of the Presidency Gov initiatives. We a partner with the grants.gov, e-Gov initiative which is the way the federal government wants to centralize all the grant information for the Federal government. So if you want to find and apply for a grant you go to grants.gov one place. We were actually able to use the web services tools of CDX to assist on the backend on an internal way, grants.gov. So it's wonderful when you find solutions like that that you can reuse and the more we develop solutions like that the more we'll be able to do that.
Mr. Abel: Well, let's talk about one initiative in particular. Can you tell us a bit about the environmental indicators initiative just a little bit about what it is and how it helps the EPA to manage the results?
Ms. Nelson: Well, as you know, Dave, over the years there have been many initiatives that required the government to focus on results. The government performance results act, what we have to do for our budgeting purposes, the most recent part tools that OMB is using to assess programs in terms of their effectiveness. But what we found is even some of those statutory requirements were lacking, at least within EPA. Because much of what we have to do has a long term horizon to it in terms of really understanding the condition of the environment and we tended to focus more on, as many people do, the widgets or the outcomes.
You know, how many permits were issued, how many enforcement actions were taken, those kinds of things versus what's the quality of the water across the country. And what we're trying to do with our environmental indicators initiative is to really focus for the American Public on answering those questions. Our very first step was the draft the report on the environment, I mentioned earlier. That was a first milestone and a very long-term effort.
One of the most important things we're doing right now is when we issued that report we were not able to answer almost three quarters of the questions in a very solid way. Some questions we couldn't answer at all, other questions we answered with what we recall like a level two indicator, with some information but it wasn't the very best. We are now looking at all of those gaps and to have a process in place for determining what are the highest priority gaps, how do we fill those gaps, what it will cost to fill those gaps, and what's the signs that we have to understand in terms of filling those gaps.
So, think of this as a very long-term initiative within the agency to truly begin to collect the information we need to understand the condition of the environment. And I'll just say as a final note, some people might say, you know I can't understand, you know you've been around on these 35 years, why weren't you collecting some of this information. Much of it is because of the change in focus, many of the laws that were in place directed certain activities to take place, like issue permits and performance inspections and they were the things we had to report to Congress on. But you know, even if every facility has a permit out there, it doesn't mean the environment is getting better.
Even if every facility has been inspected it doesn't mean that the air is getting cleaner. So, we need to begin to collect the information so that we ultimately understand the outcome and we didn't do that before because the laws didn't require that. Now, maybe that's not a good reason, but we focused on what the laws required and now it's important to focus on the bigger picture.
Mr. Lawrence: It's a very interesting point, especially the alignments between the metrics and the ultimate outcomes, you want to have. Let me ask you to take that question into your office, what performance metrics do you use within the office to determine if the goals are being met?
Ms. Nelson: Well, we are meeting with the Office of Environmental Information's board of directors to adopt for the very first time a balanced scorecard. When I came onboard at EPA, it was less than two years old, and we really didn't have as an organization good metrics in place. We received, interestingly enough an internal grant from our Chief Financial Officer to put performance metrics system in place for the office environmental information, we're doing that starting October 1st, which is the start of the fiscal year and we're trying for the first time a balanced scorecard. So I'm sure we won't get it 100% right but it will be a learning experience.
Mr. Lawrence: Interesting, you will have to come back and tell us how it turned out. EPA is involved in many of the e-gov initiatives, how are they doing and what have been the lessons learnd, we'll ask Kim Nelson of the EPA to give us certain thoughts when The Business of Government Hour returns.
Mr. Lawrence: Welcome back to The Business of Government Hour, I'm Paul Lawrence. This morning's conversation is with Kim Nelson. Kim is the Assistant Administrator and Chief Information Officer of the Environmental Protection Agency, joining us in our conversation is Dave Abel.
Mr. Abel: Kim, the EPA is involved in 14 of the 25 e-government initiatives that are currently underway. Can you tell us a little bit about some of these initiatives?
Ms. Nelson: The e-government work is very exciting, you know, people said to me when I came to Washington, we talked a little bit about this earlier actually, how difficult it is to make a difference in a short period of time. Well, when I would look back and realize that this e-gov initiatives have only been underway for less than 3 years. I think it's phenomenal when we look at the progress. The e-gov initiatives are part of the President's Management Agenda. It's his desire, his vision to make sure that government is citizen centric, that government is result oriented and that we use market based solutions and that's what you're seeing in the e-gov initiatives. We're involved, as you said in 14 of them. That clearly keeps us busy because we're a much smaller agency than many of the big departments but so many of these are fundamental to how we work.
One of them that are very important to us is the e-authentication project. It's really what the federal government is trying to do to ensure that we can establish identity, authenticate users to ensure the proper transmission of electronic documents with electronic signatures. Our role, I think, in this is very exciting. We were recently given a grant and here's another way that government is being very innovative we got a grant from this project for $700,000 for EPA to be able to demonstrate the interoperability of digital certificates between state governments and the Federal government. So, we're demonstrating through all the work we've done with our state partners in CDX, how you can take a certificate that a facility has and using in State government and use that to authenticate a submission to the Federal government and vice versa.
Likewise, another project we're working on, which I -- would be remised if I didn't mention is the rule making initiative. Rulemaking.gov, EPA is the lead partner on that initiative, which means we're managing that with many other agencies as co-partners but we are the managing partner of that initiative and through that website "rulemaking.gov," citizens can go one place, for the first time ever one place and put in any kind of key word. If you're a farmer and you're interested in agriculture, if you're a teacher and you're interested in some education issues, if you're interested in environment, something like mercury, you can type in one key word and find every Federal agency that has some kind of rule making or policy open for public comment.
Mr. Abel: So, EPA is a participant in the e-rule making program with e-government, overall you are one of multiple participants?
Ms. Nelson: We're one of many participants in rule making but we are a managing partner. So it's my office that has the overall responsibility for managing that initiative. Each one of these projects has a managing partner and we have the responsibility for rule making and that's primarily due to, of course EPA being a regulatory agency, rule making is the large part of our business. If you look at the lines of business within EPA, we issue a lot of rules, much to the dismay of some people but that's the nature of our business and as a result of that OMB felt we had a tremendous amount of expertise to manage this project, on top of the fact that we already had an electronic docket system in place that is serving as the basis or the core for rulemaking.gov.
That's the other great part about these e-gov initiatives is that throughout the federal government we're taking good ideas that already existed in one department and expanding those to many, many other agencies. So, we are reducing duplication, we were reducing redundant expenditures and we were taking a good idea and we're expanding it.
Mr. Abel: So, what are some of the management challenges that you faced in the implementation of these programs?
Ms. Nelson: The biggest challenge is that we're operating in a very innovative way. We are bringing partners together and working on common solutions and we are doing really terrific things in a way the Federal government never behaved before but we still haven't managed to get all the processes and the bureaucracy to catch up with that innovation and it makes it very difficult sometimes to do the very basic things we have to do, like move money around. Because when you have an initiative that involves 20 partners, that means 20 different agencies have to pay for that project.
Well, getting the money from 20 different agencies all at the right time, getting 20 different agencies to participate in a decision is not always the easiest thing to do. So, the governance side of the house hasn't quite caught up with the technology and the innovative thinking but it's not holding the projects up, it just means it's making a little bit more of achallenge to manage it.
Mr. Abel: Have there been any early successes?
Ms. Nelson: Oh, I think many of the e-gov projects could be called early successes. FirstGov for instance recently won a very prestigious award for being so citizen centric and has received tremendous number of awards. Rule making is a wonderful success; the business gateway is now up. If you're a small business owner and you haven't been there, you need to go to the business gateway.gov site. Because if you are a small business owner you can go to one place now and find what you need to do from an environmental prospective, or a labor prospective, an IRS prospective, and get all of that in one place. So these are the kinds of services that are being put in place for citizens across the country.
Mr. Abel: Can you describe the significant challenges that the EPA will face in the future?
Ms. Nelson: EPA's challenges for the future are the fact that in many respects we've managed to do the easy things. It's the 80/20 rule. If you look across the country, rivers that used to be black and polluted and burning are no longer there. I come from the state of Pennsylvania, if you think of what Pittsburgh looked like 30-40 years ago, where a man going to work in the morning with a white shirt had to change his shirt in mid-day because the air was so polluted. We don't have that problem in the United States anymore. We've made huge environmental progress.
The challenge we have in the future is that, in order to make the next incremental change improvement in the environment, it means it's going to involve every single person in this country. We made this huge environmental changes in the past by driving hard largely on industry, cleaning smokestacks, cleaning up industry but the biggest polluters today are you and me. It's the car we drive, it's the lawn mower we use, it's the gas grill we use, it's the fire places we burn in the winter time, it's our life-style that has the biggest impact on the environment today and that's hard for people to accept. It's easy for them to say, take care of that factory down the road that's spewing dirt out of its smokestack.
It's another thing to say to somebody, you know you should be driving a different car, you shouldn't be using your lawn mower, you shouldn't be using your grill. That changes your lifestyle and people don't like that. But we all have to look internally and make our own changes to our own lifestyle because if we do that, we can make a big difference. One thing I would encourage everybody to do, if you don't have fluorescent light bulbs in your home, put 1, 2, 3, 4 fluorescent light bulbs in your home, if you do that, if every single person in this country put a handful of fluorescent light bulbs in your home, we could reduce the number of power plants being built in this country and nobody wants a power plant built in their backyard. And if we reduce the number of power plants, we can reduce the air emissions, which dramatically improve air quality. So, doing simple things like that, like putting in a fluorescent light bulb in one room, one bulb in each room of your house, can improve the environment.
Mr. Lawrence: Let me ask you to take a step back and reflect on your careers. You think about maybe somebody interested in joining public service, what advice would give them?
Ms. Nelson: Well, for me -- you know I only have one prospective, I've only ever worked in government, it's certainly incredibly rewarding, the ability to impact public policy, the ability to make a difference in terms of how government serves citizens. It's something that's so incredibly rewarding. I would encourage people to try sometime in public service if you're currently working in the private sector. I would love to see the kind of work environment where people who are currently working in government could go also out into the private sector and spend some time in business because I think walking in another person's shoes ultimately always makes for a better person.
Unfortunately, we don't always have that flexibility and it would be great if the Federal government -- and they're looking at that, looking at ways to make it easier for people to move in and move out, even if it's for six months, a year or two years to gain some experience. So, I would encourage people to be as well rounded as possible. I regret I don't have the business experience. I tried to spend more time with people in the private sector to understand their needs and concerns. In the future I think we all will be better served if we could do that.
Mr. Lawrence: Kim, that'll have to be our last question. We're running out of time. Dave and I want to thank you for squeezing us in your very busy schedule.
Ms. Nelson: Well, thank you very much Paul and one final note. I just want to say October mark's Children's Health month. Children from the Environmental Protection Agency's prospective, are one of the most important parts of our population--they are our future. We recognize that as we look to the environment, we need to protect our children, they're our future.
With children's health month, I encourage every parent, every teacher and every child out there to better understand what the environment means to a growing child. So go to EPA's website www.epa.gov and look for children's health and you'll see it right upfront and you got lots of great information about how you can help protect the children of the country.
Mr. Lawrence: Thank you Kim. This has been The Business of Government Hour featuring conversation with Kim Nelson, Assistant Administrator and Chief Information Officer of the Environmental Protection Agency. Be sure and visit us on the web at businessofgovernment.org. There you can learn more about our programs and research and get a transcript of today's fascinating conversation. Once again it's businessofgovernment.org.
This is Paul Lawrence, thank you for listening.
Monday, June 21, 2004
Mr. Lawrence: Good morning and welcome to The Business of Government Hour. I'm Paul Lawrence, partner in charge of The IBM Center for The Business of Government. We created the Center in 1998 to encourage discussion and research into new approaches to improving government effectiveness. Find out more about the Center by visiting us on the web at www.businessofgovernment.org.
The Business of Government Hour features a conversation about management with a government executive who is changing the way government does business. Our conversation today is with Rodney Bent. Rodney�s a professional staffer on the House Appropriations Committee. But perhaps more interesting, he�s just come back from six months in Iraq, where he�s been the director of the CPA�s Office of Management and Budget and also served as a senior adviser to the Iraqi Ministry of Finance.
Good morning, Rodney.
Mr. Bent: Good morning.
Mr. Lawrence: And joining us in our conversation also from IBM is Jonathan Breul.
Good morning, Jonathan.
Mr. Breul: Good morning.
Mr. Lawrence: Well, Rodney, let�s start at the beginning. Could you begin by describing for our listeners how the resources were allocated for the reconstruction of Iraq?
Mr. Bent: Certainly, absolutely. There were three pots of money. Perhaps the most important pot of money is Iraq�s own resources, the oil money that it earned both currently and then previously under Saddam, under the Oil for Food Program. That�s about, in terms of the �04 budget, $21 billion.
In addition, there was 18.4 billion that was appropriated last year, and prior to that, a couple of billion, 3 billion that Congress also appropriated. Finally, there was the about 12-, $13 billion that other countries had pledged to help Iraq in its reconstruction in a Madrid conference in October of 2003.
Mr. Lawrence: Now money was allocated through the supplemental. And I�m curious, is there precedent for allocating money this way?
Mr. Bent: There is. The President requested something over $21 billion, I think, originally. And he presented his request in a format with about 10 or 11 sectors, about 60 line items, such as power generation or potable water. But he really was requesting a large amount of money that would be similar -- that he could use in a flexible manner similar to what had been done with the Y2K fund or the supplemental immediately after the September 11th tragedy.
Mr. Breul: Rodney, the Coalition Provisional Authority, or CPA, was the name of the temporary governing body which has been designated by the United Nations as the lawful government of Iraq until Iraq assumes sovereignty. What role did the CPA play in managing the fund?
Mr. Bent: Oh, a huge role. Ambassador Bremer was essentially the fiscal steward for the Iraqi funds, and he was also, if you will, the person who was allocating the American supplemental. What he and the CPA did essentially was to try and put together a budget and a resource plan for the reconstruction of Iraq.
Mr. Breul: Well, what are the critical skills required to manage and provide oversight for the reconstruction funds?
Mr. Bent: Good question. I think that when I got out there, I discovered that I had a staff of 10 or 11 people who were enthusiastic, young, intelligent, but had never worked on budget issues before. And so one of the skills, and we can talk a little bit later about this, is sort of that fundamental analytical perspective, how to listen, how to ask the right questions. What kind of options do you prepare? Who�s doing what? What are the consequences if you do it a certain way? Can it be done? What are the practical questions?
Mr. Breul: Well, what was your role and what were your duties then while you were in Iraq?
Mr. Bent: I had a bunch of them. I was the head of the CPA Office of Management and Budget. I was the senior adviser to the Ministry of Finance. And I was also the senior adviser to the Ministry of Planning and Development Cooperation, and other duties as assigned.
Mr. Lawrence: How do you get three jobs?
Mr. Bent: Well, essentially the titles were meaningless in the sense that we were sort of inventing as we went along. It wasn�t structured. You went you there and you essentially would see things that needed doing, questions that needed to asked, or problems that needed to be addressed. And so a lot of times, you know, we were working on things that would have been well outside the purview of what you would normally think of. For example, we worked on the pay structure for Iraqi civil servants, you know, who gets paid how much, how they�re defined. That is not something that usually a Ministry of Finance or an OMB would look at, but there, it was essential. And then you add in things like reforming the pension system or handling food subsidies, oil subsidies, electricity subsidies, building electric power plants. It was just a huge range of activities.
Mr. Lawrence: What does a typical day look like when you�re doing these kind of things?
Mr. Bent: Well, it was intense. Generally people were in the office by 7:00 in the morning and we would go until 10:00, 11:00, midnight, 1:00, or 2:00, 7 days a week. The only time we theoretically had off were Friday mornings between about 9:00 and 12:30, where I say �theoretically,� because no meetings were supposed to be held, but, in fact, people tended to go to the office because that�s where the computers were, that�s where you could get things done. Well, it was tough.
Mr. Lawrence: Tell us about your experiences leading up to this role.
Mr. Bent: Sure. I�d been, for five years prior to doing this job, the senior career head of the international division at the Office of Management and Budget, and I�d worked at OMB for about 20 years. Before that I�d been a banker in New York and had worked at the U.S. Treasury Department in their international division.
Mr. Lawrence: And then tell us about, given your experiences, walk us through your decision to actually go to Iraq.
Mr. Bent: Well, it was a little spontaneous. I got a call from the Pentagon asking if I knew anybody who would be interested in working on budgets in Iraq, and I said I would. And they said, well, the search is over.
Mr. Lawrence: And when you got there, how would you compare and contrast your experiences sort of in Washington versus working there just in terms of, say, management skills and the kinds of things, you know, you would think about as an adviser?
Mr. Bent: There are a lot of similarities, especially given work at OMB, where usually there�s a lot of conflict: agencies want more money, the Congress wants more information, the President wants more flexibility. And some of those same conflicts play out -- or played out in Iraq as well, but there were just extra complexities in Iraq, there were extra challenges.
Take small things, like phones. Here, everybody�s got phones, faxes, E-mail. There, the phones, there were no land lines in Baghdad, so everybody had to use small cellular phones. The signals were erratic. In fact, I had -- used to have to stand on a chair at the Ministry of Finance to try and call back to CPA with the cell phone. Most people didn�t have phones, and so although the CPA provided cell phones to the Minister and his senior deputies, they weren�t always on, you couldn�t always find people. And so just basic communication was hard.
Plus, Iraq is a society that prizes that kind of personal relationship. Things that you might do here over the phone, there, they really required a face-to-face meeting. You had to sit down and you had to have tea, you had to talk about families, you had to talk about your personal relationship. It�s a very intimate kind of way of doing business.
Mr. Lawrence: Well, how about just continuing on the tactical? How about just languages?
Mr. Bent: Most of the Iraqis that we dealt with were quite fluent in English, to a greater or lesser degree. We did have interpreters and you�d use them in situations where it was important that you get the facts or the nuances exactly right. But by and large, we conducted business in English, and that was less of a problem than I thought it might be.
Mr. Lawrence: And then how about the speed of decision-making? As you were describing all the challenges in your different roles, I couldn�t help but think of sort of a desire to go fast and get things done. And when you talked about the relationships people needed, having tea, it seemed like go slow, so I�m sure it�s been a balancing act.
Mr. Bent: There was clearly a lot of cultural differences, if you will. Ambassador Bremer�s a very decisive guy. Anybody who�s been in a meeting with him, you know, he wants the facts, he wants your recommendation, he wants to know why you think this way. He�ll ask, frankly, a series of very probing questions and he makes a decision.
With the Iraqis, it�s a different cultural mode of handling things. There�s a great respect for I think elders. And so that means that when you have a conversation, you have to make sure that the oldest person in the room has a say. You have to make sure that there�s a traditional -- or terrific emphasis on coming to a consensus. It�s -- people might say what they think, but they always want to bring in other people. And so you found yourself frequently having to make sure that you talked with everybody and that you drew people out in a way, and did it in a respectful manner. It�s considered very rude to directly contradict somebody. It�s not that people don�t say no, but they would preface it by saying, well, with respect, I appreciate what you�re saying, but in fact, I must offer up an alternative suggestion as opposed to you�re an idiot. And that took a little while to get used to.
If you�re coming from a culture that kind of prizes decisiveness and get it done and do it now to a culture where you have to explain the context, people want to know what your motivation is, why are you doing this, what are the implications, what does it mean for them. And that just takes more time, but in some sense it�s worth it because once they�re persuaded, then they will do it.
Mr. Lawrence: How did all these things change your management approaches and styles while you were there?
Mr. Bent: The absolute importance of listening carefully. Before I went over, I asked a variety of people at the World Bank or AID or the State Department what it was like and what the issues were. And I think one of the best pieces of advice I got was to listen to what the Iraqis wanted, not just jump ahead and assume that they would want the same things that we would want. And so I spent, frankly, a lot of my time listening and then trying to summarize and then trying to present options that would reflect what they wanted.
Mr. Lawrence: Can you give me an example of where they would not want what we wanted?
Mr. Bent: In terms of basic personal security, the aftermath of the war was really a disaster, the looting, the crime. The Iraqis had this tremendous sense of personal vulnerability in which your kids could be kidnapped as they were walking to school; cars were taken. It�s impossible to project that sense of insecurity to, say, people here in Washington. You walk out your door, you get in your car, you drive off, you don�t worry about somebody taking shots at you, you don�t worry about your kids being grabbed while they�re being walked to school, you don�t worry about a ransom note, you don�t worry about roadside bombs or grenades or gunshots. And yet, that�s part of everyday life in Iraq. And so, you know, there�s that huge difference there, so security is one thing.
Basic infrastructure, electricity, communication, telephones, these are all things, employment, that are important to Iraqis. And yet, for the Americans I think when we were there, and I�ll just use this as an example, not to pass judgment, but security, sort of training the Iraqi police or training the Iraqi armed forces, and that clearly is part of dealing with that first problem I talked about, security. But it was such a long-term solution, it was something where, you know, by the time the police were trained and equipped, it was going to be months down the road. And yet, what the Iraqis wanted now was being able to walk out their door and not feel like they were going to be killed.
Mr. Lawrence: Interesting.
How has the economy of Iraq changed over the last two years? We�ll ask Rodney Bent to take us through the stages of the economy pre-Iraqi Freedom and what it�s like now when The Business of Government Hour returns.
Mr. Lawrence: Welcome back to The Business of Government Hour. I�m Paul Lawrence, and this morning�s conversation is with Rodney Bent. Rodney�s on the professional staff of the House Appropriations Committee.
And joining us in our conversation is Jonathan Breul.
Well, Rodney, in this segment, I�d like to talk about doing business in Iraq. Perhaps you could begin by telling us more about the political and social and economic contexts in the country. What were your observations about the people of Iraq in terms of their sense of history and the social cohesion?
Mr. Bent: I guess the starting point for Iraq is really the fall of the Ottoman Empire in World War I. And out of that wreckage the British, particularly for the history buffs, Richard Bell created an Iraq that previously was probably several parts. I mean, one would be Kurdistan, the third would be the Arab Sunni middle, if you will, and then there would be the Shia south.
Iraq has, you know, a huge history. I mean, you go back to Mesopotamia and Babylon, so it�s got 5,000 years� worth of history, but really only for the last 80 or 90 years as the country of Iraq. And so there are a lot of disparate groups. I mean, you categorize yourself by religion, by tribe, by ethnicity, by family, by clan, by whether you�re educated or not educated, rural, urban. There are just lots and lots of different ways of classifying yourself.
I was struck in some ways by how -- rigid might be the wrong word, but maybe class-conscious Iraqis were. Everybody knew sort of where you fit, that there wasn�t the kind of -- there was sort of a long history to families. And so people would say, oh, he comes from a good family. And the upper tiers of the Iraqi society are really both very well educated and everybody knows everybody. So for example, the Deputy Minister of the Ministry of Planning had a wife who worked as the director general of the Ministry of Finance, and everybody tended to be friends, to have gone to school with the other people. And so there was kind of, on the one hand, a whole series of divisions and, on the other hand, a kind of a cohesiveness. And it made for some strange interrelations.
Mr. Breul: Rodney, can you give us a sense of the state of the economy in Iraq before Operation Iraqi Freedom, and then what it was like when you were there?
Mr. Bent: The Saddam economy was essentially a disaster. The state ran everything. It was in a state of decay and decrepitude. It relied essentially on the Oil for Food Program to feed people. It�s -- if you drive down or go through Baghdad, even the nicer sections have a kind of a shabbiness, and I was just, frankly, struck by how rundown and decrepit and used everything seemed. Cars were all 10, 15 years old, battered, missing headlights, bumpers ripped off. It was a huge contrast to go to another Arab country, say Jordan and Amman or Abu Dhabi, and see essentially a complete contrast, with new cars, new buildings, paved streets, functioning electricity, everything. I think that the -- you know, Saddam obviously and his coterie of folks didn�t suffer from any of this, but you really felt the plight of everyday Iraqis.
Mr. Lawrence: And was it changing after Saddam or how --
Mr. Bent: I think just huge changes that you could see. I mean, there were probably a million additional cars on the street by the time I left. In fact, when I arrived in late October, you could drive through downtown Baghdad without too much trouble. I mean, the streets are broad, but there wasn�t a lot of traffic. By the time I left, people were complaining about the traffic. It would take an hour to get somewhere; everything was gridlocked.
You could see on some of the shopping districts just stacks of warehouse goods: refrigerators, air conditioners, TVs, satellites. There was an explosion in satellite TV, and you just felt like this society had opened up in some way from going -- from the closed Saddam period where, you know, you couldn�t own -- nobody had satellite TVs to a period where it seemed like every family who could afford one was out buying one.
Mr. Lawrence: Well, what are the types of challenges people like yourself face when you�re working in Iraq on a day-to-day basis?
Mr. Bent: Huge. I mean, the -- one challenge is communications. I talked about the cell phones, but that meant it was very difficult to get ahold of people. And Iraq, essentially, it was frozen in time. There was a Rip Van Winkle quality to, you know, pre-1991 and post-1991. So that, for example, in the medical schools, the journals stop in 1990, 1991. There are no recent journals.
People were not used to a computer. In fact, when I went to the Board of Supreme Audit, which was kind of a combination GAO and auditing firm, we talked about their use of computers and auditing processes. And they said, well, yes, of course we use computers. Let�s show you the computer center. Well, you go. Well, there are no computers in the computer center. What they meant by computers was essentially doing spreadsheets and very basic work as opposed what we might think of in terms of auditing.
Danger was clearly the second thing. Every time you strapped on your flak jacket and put on a helmet and drove out of the Green Zone, you were always a little bit nervous about, well, what might happen. The day before I left, in fact, one of my staff came in and very apologetically said, well, he�s sorry, but he�d wrecked the car. And, you know, I felt a little bit like, okay, I�m the dad and the teenage son has come back. And well, it turned out he�d been shot at by somebody driving a pickup truck with an AK and he�d just riddled the car with bullets, and it was just a miracle that the staffer wasn�t injured or killed. And I mean, that -- you know, one of my translators was blown up in a bomb on January 18th. You know, it was -- that gives a different perspective on things.
Mr. Breul: Let�s talk about the project implementation stage of the resources that were allocated for the reconstruction of Iraq. Can you describe the types of projects that the Defense Department, the State Department, and the U.S. Agency of International Development are implementing?
Mr. Bent: Sure. Broadly speaking, the Defense Department was doing two areas. One area was clearly security: training the Iraqi armed forces; training the ancillary groups, Iraqi Civil Defense Corps, the border enforcement. They were also, through the Project Management Office, handling a lot of the reconstruction of Iraq itself. The Army Corps of Engineers was heavily involved, so power plants, dams, irrigation, railroad, roads. Defense was involved in all of these things.
The State Department was working on training police on some of the democracy programs. AID was doing some of the reconstruction along with Defense on electricity, but they were also doing health, education, some other governance issues, trying to help the Iraqis establish what we would call a civil society.
Mr. Lawrence: The reconstruction has relied on a lot of private contractors, and that�s not without controversy in terms of pluses and minuses. I�d be curious sort of your perspective and some lessons learned on the use of contractors in this environment.
Mr. Bent: It�s one issue is using contractors to do what we�d call inherently governmental services. And, you know, whether you talk about the tragedy at Abu Gharib or, you know, clearly there�s been -- you know, that�s just horrible abuses. But really, contractors bring you a lot of things that you wouldn�t otherwise get. I mean, there are not many people in the U.S. Government that have sat around building power plants or looking at dams or being civil engineers. You get some, but they don�t generally -- they oversee, they don�t generally do. And so private contractors were essential.
I think it�s a little bit different when you talk about policing or some of the other things where there�s clearly a gray area in terms of what gets defined, who does what.
Mr. Lawrence: There�s a sense of one perspective that an awful lot of money�s being spent on contractors and, gee, you know, people are taking advantage of the system. There�s also a sense that, gee, this is a very high -- this is a very risky place, as you�ve indicated.
Mr. Bent: Yeah.
Mr. Lawrence: It probably does cost more to get people motivated. As the budget guy, how did you work that equation?
Mr. Bent: Well, it was an increasing part of the equation as we were ending. As I was leaving, I was listening to I think it was Mr. Waxman talking about trucks in Iraq and saying, well, people didn�t have -- they would abandon an $85,000 truck because it had a flat tire. And I don�t know this to be the case, but I was speculating in my mind, well, anybody who�s driven on a highway in Iraq knows that you�re not going to pull over and change a flat. I mean, that�s a sure way of getting killed. And so, you know, on the one hand it points out the risks of working in Iraq and just the extraordinary extra cost for security that you have to pay. On the other hand, you can sort of say, well, heck, why are we doing that if it�s going to cost, you know, for lack of a spare tire, we�re going to lose an $85,000 truck? Should we be doing that?
Mr. Lawrence: And how about the personal benefits when you see people interviewed now in the media? I mean, they do cite sort of, you know, sort of a Peace Corps kind of I should be there, I should go and help these people.
Mr. Bent: You know, I think that -- I never knew anybody over there who was in it for the money. And maybe truck drivers for Halliburton or whatever, but by and large, the folks at CPA were a pretty high-minded lot. I mean, it -- everybody went over there with a sense of purpose, with a kind of desire to help in any way you could.
I think that it was kind of interesting and contrasting sort of my experience at OMB with being over there. In both cases, you have talented staff, you have people who are motivated, but there was much more out there in CPA. There was a kind of a camaraderie; we�re all in this together. You know, whatever people felt about the war, and there were a range of people who actively didn�t support the war to people who were fervent believers, but that was essentially irrelevant. The war was, as far as I was concerned, was over and done with. We had to do what we could to help the Iraqi society.
Mr. Lawrence: That�s a fascinating point about the different perspectives on the war.
What types of management flexibilities are needed to manage funds in an ever-changing environment? We�ll ask Rodney Bent to tell us what he saw during his time in Iraq when The Business of Government Hour returns.
Mr. Lawrence: Welcome back to The Business of Government Hour. I�m Paul Lawrence, and today�s conversation is with Rodney Bent. Rodney�s on the professional staff of the House Appropriations Committee.
And joining us in our conversation is Jonathan Breul.
Well, Rodney, let�s talk about managing the fund in the section. The supplemental was set up to fund 10 priority areas. Could you talk to us about some of the key areas, and what was the strategy in terms of what to focus on first and prioritize?
Mr. Bent: Sure. The supplemental had, as you say, about 10 areas. The 60 line items, as we would call them, were things like training police or building electricity or electricity transmission. When the President requested it, the focus was clearly on what I�d call hard infrastructure: dams, power projects, that kind of thing.
What changed a little bit while I was there is that, well, first, in the middle of November, there was the announcement that we were going to give the Iraqis back sovereignty on June 30th, which meant that people suddenly started focusing on democracy and elections and all the things that go with a democracy, things that we take for granted here like organized political parties, a responsible media, a way of getting the message out. There, you know, you have dozens of parties, you have every tribe, every politician in some sense sort of mobilizes, and the media is just almost a cacophony of print and radio and TV. So it was -- you know, we clearly needed to put more money into helping Iraqis pull together what they were going to probably do anyway, which is organize themselves into competing groups, if you will.
Mr. Breul: We�ve talked about how the fund was set up to be as flexible as possible given the ever-changing environment in Iraq. Can you give us some more examples of when priorities changed and just how that changed the projects that were being funded?
Mr. Bent: Sure. Well, distinguish a little bit. The request would have had the fund be as flexible as possible. I think that Congress when they reviewed it said, well, we�ll give you essentially what you want, but we want to make sure you�re going to spend the money as you say you�re going to spend the money. And so they put restrictions on how you could move it around. In other words, they wanted to make sure that if you said you were going to train a certain number of police that you really trained a certain number of police, that you didn�t move that to a different area.
I think that tradeoff between flexibility on the one hand and accountability and oversight on the other, it�s kind of a creative tension, if you will. It forces people to decide what�s important and to think about if they want to move funding, you know, what it is that they�re going to be doing. What are you going to get if you move the funding?
Mr. Breul: How did you provide for that accountability? I mean, there wasn�t a large tracking system in place.
Mr. Bent: Not compared to what we have back here, no. Well, we -- Congress required quarterly reports, the first of which I worked on when I was in Baghdad that came back. It was well over 100 pages. It went through each of the major sectors, each of the line items, if you will, and talked about vocational training, micro credit, education, water, electricity, you name it, and explained what we were going to do with the money and how we -- the periodicity, the quarters, by which we were going to do the spending.
I think in some ways it was a good system. It was a useful discipline for thinking about what we wanted to do. And because the report is quarterly, you can change it over time. You can say, heck, you know, this is now less important than we thought it was three or six months ago. We need to spend a little bit more on another sector.
Mr. Breul: Tell us some more about the challenges inherent in managing such a fund. For example, how do you go about just estimating the cost of funding a project?
Mr. Bent: Sure. That�s a good question. The starting point was always working with the Iraqi ministries on what they wanted. And so, for example, if you were working in the water resources area -- and that�s hugely important in Iraq in a way that, you know, here you might, oh, well, that�s sort of water, that�s good, but there it�s dams, it�s irrigation, it�s canals, it�s, you know, essential to the functioning of the Iraqi economy.
And so the senior adviser for water resources would work with the Iraqi Ministry of Water Resources. They�d come up with a series of dams, canals, irrigation projects, and they would put a price tag on it. That price tag or that series -- that project would go over to the Project Management Office within CPA and they�d look at it and they�d say, well, how good are the estimates? They tended to add funding for uncertainty. You know, was it -- had it been engineered out? They added money -- or they added a cushion, if you will, for security costs. And so a project that might start off costing, hypothetical, $100 would cost $125 or $140 that same project when it was looked at by the PMO, not because the project itself had changed, but because they wanted to build in ranges for uncertainty. And the cost would change again when the actual contractor or construction company looking at it got in there and could say, oh, well, you know, we don�t have a road, we can�t get this particular piece of equipment, we�ll need to do something different here.
So all the way through there was kind of almost a loop in which you�d start with the Iraqi ministries, go to the PMO, and then as they call it, task orders get written and the construction firms begin looking at things.
Mr. Lawrence: Give us a sense � earlier, you talked about just sort of the different things that are going on. As you were describing developing the price estimate for the Iraqis for the first part of that, I just began to think about data collection and how that�s done in an environment that�s so very different.
Mr. Bent: Yeah. Well, good point. We were always operating in a -- like being a ship�s captain where you don�t have radar and you�re not entirely sure where you are. For example, when I got to Iraq, the common estimates of unemployment or underemployment were sort of in the 50 to 60 percent range. When we left, the Ministry of Planning, which was responsible for pulling together the statistics, said, well, they kind of reckoned the unemployment rate was, you know, around 20 percent and the underemployment rate was about 28 -- 25 to 30 percent. So -- but how did they get those statistics? Where did they come from? How good were they? How were they, if you will, annualized? All of that was sort of a work in progress. So you were -- we were forever hoping that we�d kind of gotten the basics right without really knowing if we had.
Mr. Lawrence: And also, how do you manage? There�s multiple sources of money, so we have multiple projects and multiple sources of money. I can�t help but think about duplication and just accounting.
Mr. Bent: Sure.
Mr. Lawrence: How did all that work?
Mr. Bent: Well, I think the primary emphasis was on getting stuff done. And so if you were looking -- if you were working with the Minister of Electricity on power projects, you clearly had a finite set of projects that you were dealing with. And whether those projects were going to be financed by Iraqi resources, by the development fund for Iraq, or by the supplemental, you�d clearly talk about it and you could work out that part of it.
But the follow-on part, and this is where I think the advantage of having people who�ve worked on budgets was important, the real question was not could you build more power plants or fly in generators, if you will; it�s the fuel for those generators and the pipelines and whether you�re going to use treated crude or whether their refined product was available. Those are the kinds of follow-on questions that we were struggling with.
And because I think the Iraqi body politic had been so dominated by Saddam and by the Baathist Party for 35 years, it was a top-down process. And so people we just used to getting orders and essentially following them without really talking about the dynamic. And so, you know, it was a little bit Stalinistic. I mean, if the Minister of Electricity was told build power plants, he�d build them. That didn�t mean that the Minister of Oil, for example, knew that he, therefore, had to supply, you know, how many thousands of metric tons in order to fuel those power plants.
And that�s the kind of give-and-take that, you know, we were sort of working towards, bringing that together. That was part of the challenge of the Program Review Board and part of the challenge of my job, and certainly that of Ambassador Bremer.
Mr. Lawrence: Was it hard for these folks who had not operated on that sort of system of learning and collaboration to get to that point?
Mr. Bent: Well, yes and no. I mean, there�s clearly, because of the, you know, the back and forth in Iraqi society, you know, a real tendency to talk about everything. On the other hand, you know, I think they were so used to following orders, there was sort of that tension. One of the things I�m proudest of was a moment in the Program Review Board, which used to look at all of the spending proposals. And the Minister of Finance had always been a member of the board, but we succeeded in getting the Minister of Planning to come and the Board of Supreme Audit to look at it. And I began to have ministries that wanted to do projects, like the Ministry of Electricity come in and give their proposals essentially directly. And then the Minister of Finance or really his staff would challenge, well, what about this? Did you consider that? It was really great. I mean, you could sort of see essentially how people were arguing over actual spending. They had some control, some empowerment over what they were doing in a way that, you know, would have been inconceivable five years before.
Mr. Breul: Rodney, who comprised the members of the Program Review Board and how did it sort through all the competing demands?
Mr. Bent: There were probably 10 or 11 different groups represented on the Program Review Board: Australians; the United Kingdom�s Department for International Development; members of the CJTF-7, which was the multinational force, if you will; various members of CPA; and then obviously the Minister of Finance, and then, as I say, we succeeded in getting other Iraqis to participate in the meetings of the board.
It would meet once a week, typically Saturday mornings, but there�d be staff meetings. There was a lot of interaction back and forth. We�d put the minutes up on the web so that if you had access to the Internet, you could at least see what was there. We arranged for translators to be there to make sure that we were really having, you know, full and open consultations.
Mr. Lawrence: That�s a fascinating point.
When the funds were provided to Iraq, quarterly reports were prepared, as Rodney described. He�s been one of the people who�s been there when the first reports were prepared, and now he receives them on the Hill. We�ll ask him what it�s like to review this reporting requirement from both sides when The Business of Government Hour returns.
Mr. Lawrence: Welcome back to The Business of Government Hour. I�m Paul Lawrence, and this morning�s conversation is with Rodney Bent. Rodney is on the professional staff on the House Appropriations Committee.
And joining us in our conversation is Jonathan Breul.
Mr. Breul: Rodney, what role did Congress play and does play in the distribution of the funds and the reconstruction efforts?
Mr. Bent: Huge role obviously in terms of the initial appropriation, but then also the subsequent oversight, both getting the reports from CPA, and presumably in the future, it�ll be the State Department on what�s being done, asking questions, looking at the components of the spending, making sure it all adds up.
Mr. Lawrence: You talked about the reports earlier and that you were there pulling together the first one, and now you receive it. Can you reflect on the process of pulling the report together and interpreting it from the different points of view?
Mr. Bent: Sure. When I got out to Baghdad, I thought that I�d get out and find, you know, well-established routines, people who had clearly put together the first report and done I thought a very good job and could explain what was behind all of the assumptions. When I got out there, a lot of those people had already moved on in some sense. And so we were starting from not ground zero, but we were, in a lot of cases, reinventing what had been done. Who was going to carry something out? Why did we make these assumptions about the number of power plants or the number of police who were going to be trained or the number of staff? And you have to adjust that.
There was clearly, I think, as an example, a desire to spend more on security because that was more important. And so the Iraqi armed forces, which were initially conceived of as I think an agent against external aggression, sort of in the change I think became less relevant than, say, standing up the Iraqi Civil Defense Corps, which was part of the internal group that was helping the multinational force deal with the insurgencies.
Mr. Lawrence: When we think about reporting, of course, you get lots of money, you need reporting. And some would argue reporting is sort of this bureaucratic thing and it slows things down and causes more layers. What was your perspective?
Mr. Bent: Well, it -- I think it�s a useful discipline. It forces people to ask the questions that need to be asked. What�s the structure? Who�s going to carry it out? What are the reasonable expectations? What�s not? It�s what people do with the reports where I think that, you know, you can ask questions about, okay, do they have a role in asking tough questions. If you get to a level of questioning that really does slow things down, gee, you can�t answer who�s going to carry out this project in this governance, and so, therefore, you ought not to do it. Then you�re clearly impeding progress. But to ask questions about, well, who�s going to carry it out and what do you hope to achieve, that�s entirely legitimate.
Mr. Breul: Given the fact that Iraq has recently emerged as a sovereign nation, what are some of the challenges that you foresee for this new country?
Mr. Bent: Oh, huge challenges. One is going to be security, clearly. Second will be corruption, which under Saddam flourished at all levels. And Iraq, I think, previously was, and these are relative, a secular, humanistic culture in which honesty was prized. And yet, over the last 35 years or so, it�s moved to a period in which all sorts of rake-offs and kickbacks and corruption and influence-peddling is all part of the norm of doing business. I think, at least I hope, that more transparency, more accountability, more -- it�s not honesty, because that gives a value-laden term that I don�t think is appropriate here, but more transparent way of doing business, I guess, so that people can see that they�re getting full value for their dinars.
Mr. Lawrence: I�d be curious how you reflect on your time in terms of the expectations that have been placed on this whole process.
Mr. Bent: I think you can -- looking back on it now, the expectations of a year and a half ago were clearly way too high in terms of building a liberal democracy and a free market economy that was going to, you know, maybe not be on a par with Switzerland, but certainly up there. And I think those were absolutely unmeetable expectations. And so much more realistic would be to say can you get a functioning economy? Can you start a banking system? Can you get a government that makes essential decisions on behalf of its citizens? I think that�s possible.
I think the violence and, you know, the coming together that I hope will happen would prevent what would be a disaster, which would be a civil war and warring groups and everybody thinking that they�re entitled to take what they can take by force of arms.
Mr. Lawrence: In another aspect of your very unique experience has been working with people of different cultures, but also the military, the State Department. I wonder how you sort of reflect on all that.
Mr. Bent: Sure. I -- out there, I have just the utmost respect for the military. It�s -- setting aside Abu Gharib and whatever you think of that, I -- you know, coming back from meetings at the Ministry of Finance, and you�d see kids standing at checkpoints absolutely exposed and not knowing whether there was a sniper or whether they were going to be killed doing their job. But there was really a degree of professionalism that was -- I just found incredibly impressive. People were thrown into doing things that they had no training for. Civil affairs officers were working with the Ministry of Social Affairs on things like vocational training programs, and they kind of plunged into it. It was sort of a think outside the box, be innovative, what works, and, you know, they were sort of, you know, we�re in this. You know, we got to do something. What can we do? You know, what works? Well, if that doesn�t work, okay, let�s try something else. There was a real entrepreneurial kind of get-it-done feeling out there.
Mr. Breul: What about members of your budget team? How did they perform and how was their work environment?
Mr. Bent: Well, it -- we would leave the Green Zone probably six days a week, Friday being the holy day, and so people got out there. When I got out there, I think staff were young and talented and hard-working, but they didn�t really have a lot of experience in budget matters. And so, you know, part of it was throwing them into it and helping them as best you could. But it, I think, gets a little bit to, well, what kinds of skills were required and what kinds of folks should be out there.
The British and the Australians sent mid-level employees who worked for five or ten years on things like financial markets or budgets. And, you know, what is a little missing in the discussion back here is the contribution of the other countries to the civil reconstruction, if you will. And I will say that my Australian and British colleagues were absolutely invaluable, and they were huge important parts of whatever successes we did have.
Mr. Lawrence: Well, with that as a perspective, I�d be curious what advice, based on your career as well as your recent experience, what advice would you give to someone interested in a career in public service?
Mr. Bent: The challenges of public service are that you�re going to find a kind of a commitment and a desire to get things done that -- well, I�m not putting this very well, but I think what -- you�re going to find challenges that you�re just not going to find in the private sector. You�re going to be given awesome levels of responsibility that are going to be well beyond anything you might do as a 25- or a 30-year-old in a company. It�s on the one hand daunting and, on the other hand, it forces you to grow.
I think that if I were looking back on sort of, you know, my own career, I think that a lot of what you learn in the public sector, sort of analyzing choices, trying to bring a neutral, turn the coin and look at both sides perspective to issues, that�s important. You can�t go in and be a moralist and try to judge people�s motives. You�ve got to deal with the world as you find it. And I think that that and the camaraderie and the sense of purpose were what I most enjoyed about CPA.
Mr. Lawrence: Well, I know Jonathan and I could ask you many more questions, but I�m afraid we�re out of time. Rodney, we want to thank you for being with us this morning.
Mr. Bent: Thank you.
Mr. Lawrence: This has been The Business of Government Hour, featuring a conversation with Rodney Bent. Rodney�s a professional staffer on the House Appropriations Committee, but for the past six months, he�s been the director of the CPA�s Office of Management and Budget a senior adviser for the Iraqi Ministry of Finance.
Be sure and visit us on the web at businessofgovernment.org. There, you can learn more about our programs and get a transcript of today�s very fascinating conversation. Once again, that�s businessofgovernment.or
This is Paul Lawrence. Thank you for listening.
Thursday, May 20, 2004
Mr. Lawrence: Good morning, and welcome to The Business of Government Hour. I'm Paul Lawrence, partner in charge of the IBM Center for The Business of Government. We created The Center in 1998 to encourage discussion and research into new approach to improving government effectiveness. You can find out more about The Center by visiting us on the web at businessofgovernment.org.
The Business of Government Hour features a conversation about management with a government executive who is changing the way government does business. Our conversation this morning is with Mark Krzysko, the Deputy Director of Defense Procurement and Acquisition Policy e-Business in the Office of Undersecretary of Defense for Acquisition, Technology, and Logistics.
Good morning, Mark.
Mr. Krzysko: Good morning.
Mr. Lawrence: And joining us in our conversation, also from IBM, is Linda Marshall.
Good morning, Linda.
Ms. Marshall: Good morning.
Mr. Lawrence: Well, Mark, let's start by getting right to it. Could you tell us about the modernization of DoD's acquisition process?
Mr. Krzysko: Yes, I will. What I'd like to talk about is over the past several years, we've been moving forward and modernizing the acquisition business process. Last year, we took a major step within the Department of modernizing the acquisition process, and that is the 5,000 processes we call it there. This year, we're working on the defense acquisition regulation and attempting to streamline our regulations to make it easier for people to do business. That modernization is to remove a lot of the regulatory aspects of what we're trying to do so we can become more commercialized in the way we do business as a department.
Now, certainly, we can't be perfectly commercial as an entity because we are a federal government and have rules and regulations. But to ease that pain and move forward in the regulations through those two major initiatives, as well as other initiatives, that principally being what I have to do is work with the business modernization program on how we would reengineer the business process for the acquisition community, and that, too, is also another significant effort.
Mr. Lawrence: How do you ensure that what you're doing is supporting the war fighter?
Mr. Krzysko: I believe we begin and end always with the war fighter, because it's not about the business process; it's how we improve the business process and support the war fighter. Quite simply, it's getting goods and services to the war fighter in the field, and that's what our role is. We do that within the Department of Defense and we try to measure that in our goals of being sure that we meet the role of the war fighter, because in purchasing goods and services, it's the significant aspect of what we do.
Ms. Marshall: Mark, to give our listeners a sense of the magnitude of business that flows through DoD, could you tell us the amount of contracts awarded daily, monthly, annually by DoD?
Mr. Krzysko: I pulled to metrics, one from '02 and one for '03 in the fiscal year. In '02, we awarded 5.4 million actions that account for almost $180 billion worth of business. In '03, we had 5.9 million transactions for almost $220 billion. I did the math with that, and that's about 15,000 transactions daily, amounting to almost $500 million a day.
Mr. Lawrence: Is there an equivalent that people could think about in another sector in terms of the magnitude of those transactions?
Mr. Krzysko: I have not been able to find the one that can amass that amount of transactions. When we look across the federal government, the Department of Defense accounts for about 60 percent of the business either in transactions or in dollars.
Ms. Marshall: Can you describe the kinds of skill sets of the people that work for the Office of Defense Procurement and Acquisition Policy?
Mr. Krzysko: I'd like to answer that two ways: one within the Department and one within my directorate, as well as what we do within the acquisition community, because if you look at the acquisition community as a whole, we span the gamut, everything from systems engineering and engineers, logistics, contracting, financial management to the broad skill set even with the e-Business Directorate, which are principally programmatic skills, acquisition management skills, contracting skills. In the e Business Directorate we also had the other aspect of that. It's information technology and what that means to us. So it's connecting all the business process with information technology skill sets for us to move forward.
Ms. Marshall: What is your role as the Deputy Director of Defense Procurement and Acquisition Policy in e Business?
Mr. Krzysko: My role, as I see it, is to, one, lead and coordinate the services and components with leading the transformation to e-business, because it is about delivering technological solutions to our people, men and women and the field, that support the war fighter. The Army, Navy, Air Force, and the other components do the purchasing for the Department, but they need to find a place to look for, in terms of business processes, what systems we need to employ, how we need to employ them. So we really have that leadership coordination role for the Department as it relates to the acquisition business process.
Ms. Marshall: Can you tell us about your career and the positions prior to your current position?
Mr. Krzysko: My career really came in two segments. I worked in the private industry for about 11 years. I worked in retail. I started at Woodward & Lothrop, the department store that's no longer here in the city, and then I moved to Lord & Taylor. I worked at everything from a dock supervisor through the store comptroller to the operations administrator at Woodies at Chevy Chase, and then I moved on to Lord & Taylor, where I was the assistant managing director, and I was responsible for all the operations aspects of that as well as human resources.
I decided I wanted to move on with my career so I went back to school and I got a job with the government, and that job was with the Naval Air Systems Command, and I started again, my career, in my early 30s at the Naval Air Systems Command as a contracts specialist. I was a contracts specialist for the Unmanned Aerial Vehicle Department, then I moved over where most of my career was, as an F18 PCO. I was the foreign military sales PCO for that, moving on to F14, finally leading a BPR effort as it related to partnering with industry before this job, and my position there was the e-commerce solutions manager. My role there was to bring ERP. We were implementing an ERP and standard procurement system together, so I functioned as the business process manager for that effort.
Mr. Lawrence: You began in the private sector and then were drawn to the public sector. I'm curious, what drew you there?
Mr. Krzysko: Well, at that time it was 1990, and, if you realize, that market was pretty flat for middle management, and it was very difficult in the private sector. I thought when I wanted to grow up I was going to be a consultant in fact, and IT was drawing me at that time but I needed to move on with my career, and Naval Air Systems Command offered me an opportunity and I decided I was going pursue graduate school at the same time, so I landed a job in the public sector, didn't think I'd stay here, but loved it ever since.
Mr. Lawrence: Is there any particular experience that best prepared you for your present position?
Mr. Krzysko: I thought about that question for a while when I my answer is every one of them did, because I wouldn't be able to represent myself cross-functionally if I wasn't in a function involved in the Naval Air Systems Command. I wouldn't be able to understand finances and logistics as I did if I didn't work in an operation as a dock supervisor in receipt and acceptance, and I wouldn't understand the business process for reengineering if I didn't lead those efforts. So, bringing them all together I think has lead to the culmination of the skill set I have today, and I think it's important that if I didn't have that I wouldn't be able to function as well in this environment.
Mr. Lawrence: Leaders often have this moment in their careers where they move from being the doers of work to watching over people who do the work. I'm wondering about that point in your career and how you think about that.
Mr. Krzysko: Well, in moving forward with my career, I still believe I am a doer, and I think leadership is a doing position because you can't just talk about it; you have to do it. And you have to operationalize what the vision and what transformation needs to occur, and you have to oversee that in some fashion. I take a lot of pride in empowering the staff and empowering the people that we work with to go make that transformation happen. So, it's not only oversight. You have to participate, because leadership is not a distant position.
Mr. Lawrence: You've been around some, I'm assuming, very strong leaders in your career, and I'm curious, what were the characteristics of good leadership?
Mr. Krzysko: I've had the mantra for quite a long time, "It's vision along with detail." And that's understanding the direction you want to go as well as understanding what you need to do to get there. So often the leaders that have been successful not only had the vision but had an operational background to go make that transformation happen. Detail without vision or vision without detail makes you unsuccessful at both.
Mr. Lawrence: I'm sure as part of vision, one of the key things probably left unspoken is the need to communicate the vision. I'm just curious how you communicate how you communicate your vision in a large organization.
Mr. Krzysko: Communicating a vision at a large organization is you communicate it at a local level as well. You have to participate and build alliances with the members of your community so as you move forward they can help you realize that vision. You have to it's, quite frankly, a lot of selling techniques to ensure what you're doing, because no vision is perfect and execution is always lacking, so as you move forward you have to adjust and be sure that you're pursuing that correct direction. And you do that through partnerships, both organizationally, internally, with industry so as you move forward that vision becomes more real, more crystal every day.
Mr. Lawrence: What's the difference between acquisition and procurement? We'll ask Mark Krzysko, the Department of Defense, when The Business of Government Hour continues.
Mr. Lawrence: Welcome back to The Business of Government Hour. I'm Paul Lawrence, and this morning's conversation is with Mark Krzysko. Mark is the Deputy Director of Defense Procurement and Acquisition Policy e Business in the Office of the Undersecretary of Defense for Acquisition Technology and Logistics.
And joining us in our conversation is Linda Marshall.
Well, Mark, let's define some commonly used terms in the defense acquisition and procurement workplace for our listener. How would you differentiate "acquisition" from "procurement"?
Mr. Krzysko: That's a great question, and I think oftentimes we use those terms synonymously. In some cases we can; in some cases we can't.
Acquisition, the way we think of it in the Department of Defense, is a much broader construct for us to deal with. It deals with everything from buying major weapons systems, from concept to development, to the delivery of the systems, to sustaining it, all the way through disposal.
Procurement is a subset of that process. The interesting aspect of that is that at any given point of that process, whether you're in concept development, delivery, or sustainment, you're utilizing procurement to realize what you're trying to acquire, so procurement is much more the transactional, the contractual base where acquisition is a much deeper concept for everything from science and technology to systems engineering all the way through the disposal of those systems in the workplace.
Ms. Marshall: What is meant by the acquisition domain, Mark, and can you tell us about its current transition in the future?
Mr. Krzysko: Well, before I tell you what the acquisition domain is, let me tell you where the acquisition domain fits. The acquisition domain is one fit in the business management modernization program. We have other domains human resources, installation environment, strategic planning and budgeting, logistics, and accounting and finance as well as acquisition. This represents the leadership of those business process owners within the Department to realize the enterprise architecture of what we're trying to achieve. The acquisition domain is a subset of that, but a huge subset nonetheless. It is intended to govern the acquisition enterprise both the systems, the process, the technologies at an enterprise level. It's to enable data interoperability at the Department to realize a data structure for the Department of Defense for the acquisition domain.
Our goals are also to modernize and streamline the acquisition business process, manage our IT portfolio, and build a collaboration workspace for us to move from. And that's not only with us in the Department of Defense but that's at a federal level as well as our industry partners.
And finally, but certainly not least, what it does is that it represents the change management component of how does it touch our people, because with the institution of technology in business process reengineering, what will we do to affect our people and how will we train them in the future and what skill set will we need.
Ms. Marshall: Can you discuss the operating environment and the influences that impact the acquisition domain?
Mr. Krzysko: The operating environment is extremely complex. What we've tried to do, and I'll borrow a common phrase used around here, is connect the dots. The operating is very complex because we have everything from the President's management agenda to the Secretary of Defense's initiative to the business modernization program, balance score card; we have GAO audits. We decided, through our acquisition domain, that many of these things had an awful lot in common and how could we realize the synergy from all of our operating environment to realize what we were trying to achieve a simpler, less redundant IT infrastructure supporting the Acquisition Department. So, what we were doing was bringing this together, and we've aligned all the major initiatives within the federal government as well as the Department, in our view, from the acquisition community, so we could grapple with each one of them or report as efficiently as we possibly could to each one of them.
Ms. Marshall: The Acquisition Governance Board is an important component of what you do and work with. Can you describe the role of the Acquisition Governance Board?
Mr. Krzysko: The Acquisition Governance Board is a critical aspect of what we have been trying to achieve. It is comprised we began this about a year ago, and we began with the senior procurement executives from all the services and components. This past few months, we've changed that to move to the broader acquisition and involved all the component acquisition executives so we can tackle procurement as well as acquisition. We realized we were part of a major community. It is a collaborative body where we have the most senior leaders of the Department of Defense represented and working to establish the strategic vision for us as a department to move forward. It was important for us to have that collaboration environment not only dictate from above but realize where we could have opportunities to move forward.
The Governance Board is really at two levels the AGB, or the Acquisition Governance Board as we call it, is the most senior level, and then we take the next tier down, which we affectionately call the JBOB, the Joint Acquisition Business Oversight Board, one tier down from the senior leaders to make things happen.
We're not naive to believe that we live in a stovepipe in the acquisition community, so we've also invited and we have participated in the CIO, the CFO, as well as other components as necessary to help support our decision making as we try to move forward with the transformation.
Mr. Lawrence: You've described the governance structure that allows you to work with other parts of the organization, but let me ask you more about the management process. How do you go about collaborating with the folks like the CFO and the CIO?
Mr. Krzysko: We participate with the CFO, the CIO in their forums, as well as inviting them to our forums. I use the technical term of "managing in the middle," because you have to move to the middle of many of these initiatives because they are either technological or they're financial or they're acquisition so you have to bring the bodies together. Frankly, it's about putting yourself in that space to participate, to represent yourself and represent the interests of the Department and your business line as you move forward. If you could do that, you could find the correct balance between financial goals, technical goals, as well as acquisition goals to come out with a workable solution that you can implement very quickly.
Mr. Lawrence: What are some best practices or some lessons learned from actually going about and making that work?
Mr. Krzysko: Participate, participate, participate. It takes a lot of time, it takes a lot of energy to move forward in that. We moved out our business lane into many of those lanes whether it be in CFO forums or CIO forums or logistics forums to help and assist and bring our value from our side and bring our perspective so we could maintain a balance across the Department. Personally, I view that as one of the most critical aspects for success for any initiative. Oftentimes we forget what we need to go do when we become so focused on solutions that without that balance they fall short in many aspects because we failed to consider some of the important things that need to be considered from other viewpoints.
Mr. Lawrence: What are some of the other management challenges in trying to make the collaboration you described work?
Mr. Krzysko: It becomes a function of time. We have a very small staff within the Defense Procurement and Acquisition Policy e-Business Group, and they're very hard worked and participating in all those forums. Very early on when we were first standing up the office about a year and a half ago, we listed all the actions and forums and things we needed to participate in, and we listed eight, and the first challenge was what do we take off our plate, what do we go do? And the answer was "nothing," because everything was critically important, and my staff have been critically important in moving forward in each one of those lanes because as best we could you need to participate to make the difference, and we linked that back to it is important for us to execute our jobs in the most reasonable fashion, because we are trying to make a difference and transform the acquisition procurement community, because it is so critical to supporting the war fighter. We see that on the news every day, so that is a backdrop. It becomes our mantra to move forward.
Mr. Lawrence: Are the knowledge and skills of the employees changing? For example, as you're describing the collaboration, you're going through, I imagine sitting in my silo only having to be a specialist in my area. Now at any one moment I'm working with the CIO and the CFO and I'm going to have know a much broader range of information and, you know, capabilities. I'm curious, sir, are the employees changing the way I'm describing?
Mr. Krzysko: Certainly on our team, I think we have. I think we need to permeate that throughout the organization as we move to a more enterprise view of business processes. You have to be sensitive to financial opinions. You have to be sensitive to technological opinions. We get criticized a lot because sometimes we go in too far into those lanes and speak different languages from an IT perspective or from a CFO perspective, but you have to understand that to understand the trades and the points of view of others. And it's critically important that those skill sets are there. With the staff it is difficult for them because we joke, we find few people in those lanes, and they work through that. The come from it from a program management or a contracting background or an acquisition background. They really need to kluge all those skills together and understand the disciplines and why people are so concerned about business processes from their perspective. Bringing all them together is a difficult task, and it represents actually a promise for many of the employees because they love the dynamic because it's a continual learning environment and they can try to make a difference and learn more while they go.
Mr. Lawrence: That's very interesting, especially about the collaboration.
One of the biggest management challenges of any organization is dealing with the functional silos that exist. How are those being addressed in DoD? We'll ask Mark Krzysko for his perspective when The Business of Government Hour continues.
Mr. Lawrence: Welcome back to The Business of Government Hour. I'm Paul Lawrence, and this morning's conversation is with Mark Krzysko. Mark is the Deputy Director of Defense Procurement and Acquisition Policy e Business in the Office of the Under Secretary of Defense for Acquisition Technology and Logistics.
And joining us in our conversation is Linda Marshall.
Ms. Marshall: Mark, can you describe the process of developing a solution that was started within the Defense Department and then transferred to the civilian sector?
Mr. Krzysko: We've had a lot of solutions that have been transferred to the civilian sector, and it's principally under the integrated acquisition environment in the lane of procurement. A few of them that come to mind are the Central Contract Registry, CCR; the Past Performance System. We've also had FEDTEDS move up to a federal to provide services to that environment. Mark Foreman, when he was here, initiated the Quick Silver to try to find the low hanging fruit of initiatives that we could deploy federallywide. The Department had a few of them, and we were able to elevate them up and work them in the integrated acquisition environment.
Ms. Marshall: Is the federal technical data solution, commonly called FEDTEDS, a good example of this? You mentioned that.
Mr. Krzysko: Yes, FEDTEDS is a great example of that. FEDTEDS was developed out of the Air Force out of the Logistics Center. We found post-9/11 that the solution when we would put solicitations out on the street for bid, that information that we were putting out on the web was sensitive but not unclassified. We would have drawings of the Hoover Dam. We would have drawings of security systems that we wanted industry to provide solutions for. And we realized all of a sudden it was on an protected environment. Very quickly in the Department, what we initiated was to move that forward to protect that information, to control who and when they received that so we would understand who was getting that level of information on security.
The Department of Homeland Security was the first to pickup on this, and they tremendously led the effort in deploying it within the Department of Homeland Security. Since then, we've also extended that all the way through local governments in terms of New York City is employing that solution set. So, there we found a solution that was very small and very home-grown within the Department at the Air Force that could fill a capability gap within the procurement community very quickly and deploy nationally, and we're working on implementing that throughout the federal government now.
Mr. Lawrence: I understand the Department wants to organize the strategic acquisition at enterprise level and not a single system or component. Could you explain to our listeners what you mean by the enterprise level and why this is important?
Mr. Krzysko: Well, I think we need to recognize first that an enterprise level, what that really means, because in many cases in procurement it's what we spend our money on. We talked earlier about the magnitude of the money, and we have a tremendous amount of people that want insight as to what we spend our money on whether it's transparency for the citizen, whether it's transparency for the management of that, whether it's for the oversight communities to understand how and where we spend the money. It's critical information for the individual to understand where they're buying and what they are buying.
I have two good examples at an enterprise level that I think will crystallize this. One is we've initiated a spend analysis pilot within the Department of Defense. Based upon existing infrastructure, we're going to pilot the capability of pulling enterprise spend data from systems that are currently in place. The Army has the lead for us. The Air Force and the Navy are partnering on that to move forward and pull spend data.
Another initiative comes out of the federal solution side, out of the integrated acquisition environment. It's the federal procurement data system next generation. We are required to report all our contractual data to a system. In the past we would report it to the first generation FBDS, but this directly would move all of our business systems at an enterprise level so that a federal level we would understand who and what is spending their money on, and it would all be located in one system. It's critically important for us in the Department to do that. It's important for us in the federal sector to do that. But it's difficult to manage the transition because the technical infrastructure in the systems supporting those. When you establish single points, you have to actively manage the transition to those systems, and it's important for us to remember that it is not easy.
Ms. Marshall: What processes do you have to eliminate silos of information that may have existed, and also how does the department manager cross these processes or systems?
Mr. Krzysko: Well, silos of information we generally find that they come based upon the solutions and the technical infrastructure that's out there. We've created them because of our technological implementations. I really have a three-step process of how to think about that, and the first step of that is understanding what the process is and understanding what the business process, what the data and the information are. The way we're manifesting that in eliminating the silos is developing an enterprise architecture. Once you develop an enterprise architecture you've really managed yourself to the direction of where you want to go because you've settled on a process, you've settled on data; you've settled on the information that's needed. The next step is to assess the infrastructure and see what systems are meeting that architecture, because that will help eliminate the silos.
Eliminating the silos in and of itself is not the answer. You have to have a structure and disciplined approach because from assessing where your infrastructure is, you begin to transition your systems. In transitioning your systems, you decide whether you're going to retain them, retire them, refresh them, fix them. And you need to move forward in that lane.
We can realize, in many cases and that may sound like a long-term project but it doesn't have to be quite as long term as some would like us to believe you can realize quickly where you can implement technologies to homogenize the data, so to speak, now, but ultimately you want to have fewer, more capable systems and develop your transition plan off of that.
Mr. Lawrence: What performance metrics are you using to see how you're doing compared to those steps?
Mr. Krzysko: When I think of performance metrics at the highest level, it's always about saving time and saving money, and if you can't demonstrate that, you really don't have performance metrics. We think of it in three lanes. I think, one, we measure ourselves to see how well we're doing in terms of developing our business process, our data models, our transition plans and are we doing what we said we would do on time. We also need to assess the services and components and help them realize the transitions that they're trying to measure. So, you need to measure their progression to how well they're doing and how fast they are achieving their transformation goals because they are the supporting infrastructure by and large that are transitioning in support of us.
And, finally, you have to measure it at a process level. We need to move faster in terms of how we measure process, but we need to be careful to look at it in an enterprise level, just not at a typical segment of business. A good example of that in the past we used to measure procurement action lead time, and that would be from the moment you had a procurement request generated to the moment you executed. Oftentimes we wouldn't enter into the procurement request till we were ready to execute, so the metric always looked good, but did we really achieve the savings. You have to take a holistic measure and you have to measure as we mature, because we're not all there yet, so you have to keep moving forward and measuring yourself, measuring the process, and ultimately measuring what your technological footprint looks like. Fewer systems are, by and large, better because of the technological footprint and you can save yourself time and money.
We measured this and we had some very quick wins in the acquisition domain within our community because we were the first to step up. We moved FEDTEDS to the federal arena and didn't have a DoDTEDS anymore so we didn't need that capability internally. And we also retired the feeder system to FedBizOps. We had the Department of Defense Federal Business Opportunity system. We took that system down very early on.
I mentioned the Federal Procurement Data System. Moving to that, the measurement there culminates in two things. By our move to passing procurement data from our procurement systems to FBDS, the next generation, we not only will retire five business systems we had five feeder systems within the Department of Defense but we also business process reengineered the process because the contracting officers or the contract specialists would be passing the direct data from their contract award directly to FDBS, thus eliminating all the oversight and all the data movement within the Department. So, there you could see you measured the business process reengineered while we were reducing our technological footprint.
Ms. Marshall: Mark, I'm going to switch gears on you for a minute if you don't mind. I know your office is committed to integrating not just systems and technology but the people in the processes as well. Can you tell us why focusing on the people to achieve this vision of transformation at DoD is an important issue and what the main obstacles of achieving this are?
Mr. Krzysko: The main obstacles of achieving that and I'd like to I think you have to take all three. It's not that we solely focus on the people. You have to focus on technology, the process, the policy, the people all at the same time. Too often in the past we only focused on one, the technological aspects or the process aspects or just the people aspects. Taking as an entity, you can manage change faster if you accommodate for all three because technological solutions are not people and you need all things to change in the same fashion. The obstacles of that are principally communicative.
You need to get the communication out to the people of understanding what's changing from the technology or process perspective so you can lead them and teach them where we're going as a community. Moving as a community, the obstacles generally are that we can't reach everybody fast enough, and as the environment moves faster we will be challenged in the future to getting information out to the people to understand how the transition's occurring, what are we changing in terms of what systems we have providing solutions; how did we reengineer the process; how did we change the policy. Within the Office of Defense Procurement and Acquisition Policy, one of the things is that when we change, we get to the people and change them and inform that what we did, why we did it, and how we can help them complete their transformation.
Mr. Lawrence: Interesting, especially the integration.
Rejoin us in a few minutes when we continue our conversation with our guest, Mark Krzysko, of DoD.
Mr. Lawrence: Welcome back to The Business of Government Hour. I'm Paul Lawrence, and this morning's conversation is with Mark Krzysko. Mark is the Deputy Director of Defense Procurement and Acquisition Policy e Business in the Office of the Under Secretary of Defense for Acquisition Technology and Logistics.
And joining us in our conversation is Linda Marshall.
Ms. Marshall: Mark, how do you envision the Department conducting business with private contractors, including small companies as well as the large corporations?
Mr. Krzysko: Well, Linda, there's really two parts to that question. There's one, and everybody always wants to know how to do business with the government, and in the Department of Defense, one of the services that is offered is procurement technical assistant centers that help industry understand how to do business with the federal government. It's partially funded by the DoD, and I've participated in many forums where they help very locally of understanding how to do business, what steps you need to do, how you should prepare yourself to do business with federal government. But within the e-business world, there are also solution sets that directly tie to industry. Federal business opportunities, the single point of entry to understand what business opportunities exist in the federal government.
We have the Central Contract Registry where industry can register and must register to do business with the federal government. That's to ensure that they can get paid on time and that they could do business with us.
We have a new initiative out there, online reps and certs. We require representations and certs and a new tool is being stood up that industry can do that once and apply that to all the procurements, and that's being deployed now.
Finally, there's a solution within the Department of Defense that we're trying to permeate throughout the Department of Defense, and it's called Wide Area Workflow Receipt and Acceptance, and it's our intention to have that as the single invoicing point to the Department of Defense and hopefully at some point, maybe at the federal level, as a solution for how to take invoices from both the major contractors as well as small contractors. It's a web-based tool that will allow them to get paid and go through our processes faster and more efficiently.
Ms. Marshall: Can you tell us about your current relationship and future plans with the Defense Acquisition University?
Mr. Krzysko: Our current relationship with DAU is actually a great relationship. My former deputy for a year, Dr. Jim McMichael, has moved back to DAU and we have a great relationship working together, and I talked earlier about how people are so important. In our training, we need to realize that we need to train for the future here, and training is not just a component of how to do something but how we need to strategically think, how we need to move forward as a community. So, we need to train different skills. Any business that's not only training them on the system solutions but how to do business. Our goal is to become strategic acquirers or business brokers. So, what do you need to train individuals to do in the acquisition profession?
We're working with DAU to influence the curricula as it's developed. I participate monthly in one of our senior contract courses and go down and talk about e-business in everything we're doing. We really need to touch the people and tell them why and where we're going and what's going to affect them. So, we've had a great relationship with DAU and that will mature as we move on.
Ms. Marshall: What will the modernization of the DoD's acquisition process look like 5 to 10 years from now?
Mr. Krzysko: I think as technology solutions become more evident and we realize web-based services, we will be interconnected to work through the environment. Our acquisition process will be perfectly transparent to the entire community from the citizens all the way through the people doing the business. We'll be able to do business anywhere in the world. We will be able to connect with industry in a very efficient fashion. Not all the services of the technologies will be based within our home-grown organization. We will rely in a service-based architecture of others that provide those services, whether it's industry or whether it's someone else that interconnects, because as we realize the acquisition process and the data and what we need, we can better interconnect to cross that environment. The contracting officers will be able to work from their homes and supply the goods and services in the future.
Ms. Marshall: You mentioned strategic acquirers a few minutes ago. Can you explain to us what you mean by that?
Mr. Krzysko: Yeah, that's another great question. The strategic acquiring we sat down at one point and analyzed the skill sets of what a strategic acquirer would be and what that is. Much of that is found in data. We've realized that our environment is changing very rapidly. We're no longer local. We're global. We're no longer buying for someone down the hall, we're buying for someone across the world. We've realized that technology systems are not our own local systems. It's someplace else. We've realized that we need to work across teams and with teams. There's a variety of skill sets and services we provide, whether we buy them from GSA or get our goods and services through their instruments or contracting instruments or whether we buy them through ourselves. It is a global environment, but the real core of strategic acquiring is in realizing the information, and that's information at our desktop level which will help us make better decisions, that ultimately flow up to management decisions where they can, too, in turn make better decisions.
Mr. Lawrence: You had a significant career in the private sector, then you came to the public sector and you've been there ever since, and I'm curious, what advice would you have for somebody interested in a career or joining the public sector?
Mr. Krzysko: I have found I have been with the public sector for 13 years now. I have found it the most exciting place that I have ever worked, and I wouldn't have traded it for the world. It's given me the opportunity to make a difference, not only for myself but for the federal government to move forward. I've found that I have been empowered and working in cross-discipline opportunities, which I may have not otherwise had in the private sector. It's a very exciting time, and you can feel like you contribute very early on in your career. The training has been great, the environment, the people have been great. It is just a tremendous place to work and drive change home. The advice is to manage what you do. Do it well. Get good grades. Be sure you come with skill sets, and we can help make you better and apply those skills very quickly within the federal government to make a difference in a large scale.
Mr. Lawrence: Well, that'll have to be our last question, Mark. Linda and I want to thank you for being with us this morning.
Mr. Krzysko: Okay, thank you. It's been a pleasure to be here. One of the things I'd like to mention is we are up on the web in all of our information. We try to connect, so those who want to understand what systems are out there, what we're trying to achieve, our website is www.acq.osd.mil/dpap/ebiz/. It's the e business single point of entry and we're working on connecting it so everyone can understand what we're trying to achieve.
Mr. Lawrence: Thank you, Mark.
Mr. Krzysko: Thank you.
Mr. Lawrence: This has been The Business of Government Hour, featuring a conversation with Mark Krzysko, Deputy Director of Defense Procurement and Acquisition Policy e-Business in the Office of the Undersecretary of Defense for Acquisition Technology and Logistics.
Be sure and visit us on the web at businesofgovernment.org. There, you can learn more about our programs and research into new approaches to improving government effectiveness, and you can also get a transcript of today's very interesting conversation. Once again, that's businessofgovernment.org.
This is Paul Lawrence. Thank you for listening.
Tuesday, March 9, 2004
Mr. Lawrence: Good morning and welcome to The Business of Government Hour. I'm Paul Lawrence, partner in charge of The IBM Center for The Business of Government. We created the Center in 1998 to encourage discussion and research into new approaches to improving government effectiveness. You can find out more by visiting us on the web at businessofgovernment.org.
The Business of Government Hour features a conversation about management with a government executive who is changing the way government does business. Our special guest this morning is Kevin Carroll, the Army�s program executive officer for enterprise information systems.
Good morning, Kevin.
Mr. Carroll: Good morning. Thanks for having me.
Mr. Lawrence: And joining us in our conversation, also from IBM, is Brian Dickson.
Good morning, Brian.
Mr. Dickson: Good morning.
Mr. Lawrence: Well, Kevin, that was a mouthful. Could you describe the mission of the Army�s program executive office of enterprise information systems for us?
Mr. Carroll: Yes. Basically what we do, we�re an Army organization who provides program management support for both DoD programs, Department of Defense programs, and the U.S. Army programs. We focus in the business system area, which is like finance, personnel, medical systems, and the IT infrastructure that supports that; the communications, the computers, the servers that would support those business applications. And these aren�t just applications that work in the office -- they do that -- but they�re also applications that go into Iraq, into Afghanistan, and they handle a lot of logistics, medical, financial traffic that our soldiers use overseas. So they�re critically important in the combat service support effort to our war effort in Iraq. And we provide reach-back, meaning that the ability for the soldiers to dial back on web-based systems back to their post to get the information they need to do their job as well as providing reach-back for issues of morale, talking back home to their families, things like that, are a part of the information technology solution we provide.
Mr. Dickson: Kevin, can you share with our listeners the role of the PEO in producing these systems?
Mr. Carroll: Yes. I mean basically, our role is really to deliver results. Basically, we have to provide the acquisition oversight and review with our partners in industry, the contractors, the quality contractors that we bring to bear on the problems and solutions that we have. And then our job is really to make sure that we get products delivered on time, within cost, we get the performance that we need for the soldier. And we kind of do all that in the area of setting a climate or an environment that allows both the industry partners to do the things they need to do to make things successful and for our own employees, the program managers, who have to oversee those programs and are ultimately responsible for those deliveries. And my job basically is to try to help create that enterpreneurish environment within my government organization to get those things done and deliver results for the soldier.
Mr. Dickson: And what�s the total size of your budget to accomplish this?
Mr. Carroll: Well, we spend a little over $2 billion a year. About a billion of that is out of our program planning, you know, how we plan for programs over time; and about another billion a year comes in from reimbursable customers, people within the Department of Defense, people within the Army, who like what we�re doing and bring money to acquire more of those services or more of those products that we have.
Mr. Dickson: And how large is your organization in terms of manpower, and what kind of skills do your people have?
Mr. Carroll: We have an organization of about 600 civilian and military people, and we�re scattered pretty much along the West Coast. We have a program office in Germany that supports the European theater, but pretty much we�re East Coast-bound. It�s really a pretty exciting mixture of people that we have in our organization. We have engineering people, you know, people that are in electrical engineering, computer engineering. We have computer scientist types. We have business people, people that understand accounting and understand how to do analysis of systems. We have acquisition managers, people that understand and went to school and were trained on managing programs, how to get things done to deliver a product that we have. We have people even with some contracting background, you know, knowledge of how to contract -- the government contracting process. So we really do mix those people together in a sense to create an organization that works.
And those skills that we don�t have, that�s where we do contract out and get a program management support effort to come help us -- as well as within the government, there are organizations that exist that we pull engineering talent from, like CECOM, which is an organization out of Ft. Monmouth and Ft. Huachuca, Arizona, where we pull skills out of.
Mr. Dickson: I understand there�s been a reorganization within the Army that�s affected the PEO EIS. Can you tell you tell us about it and what are the implications for the way you do business?
Mr. Carroll: Sure. I�d say approximately three years ago, we were reorganized, all the PEOs in the Army. And really, I�m in a program executive office really just for -- and the IT business arena. There are other PEOs that do missiles and tanks and, you know, the normal things people think about in the Army. All of us were combined under the Army acquisition executive, Mr. Claude Bolton, and he�s the political appointee in charge of that organization. And that�s still true, he�s still my, in essence, my senior rater in doing things, and that hasn�t changed. But at the three-star level, Gen. Yakovac�s in charge of the PEOs and was in charge of us up until just recently, where then we moved in under the CIO of the Army, a three-star general, Steve Boutelle. And Steve�s now our -- my immediate rater that I go to, and then back up to Mr. Bolton.
The important thing in doing this, the reason their alignment occurred, you know, why we went back under the CIO, was the relationship between what Gen. Boutelle�s doing in consolidating the Army enterprises and bringing a network-centric kind of Army in the business application area in particular as well as what he�s trying to do for the tactical side, in the war fight. And by having us under him, we�re going to provide that technical backbone in support of him directly and our functional customers like logistics personnel and medical. We�ll be able to bring all that together and it really will help in the integration effort of the Army, I think, of tying the IT piece, the information technology piece, with the business piece. And I think it�s a lot better fit, and that was the purpose of it.
Mr. Dickson: Can you tell us a little bit about your previous experience and how you got engaged in this line of work and became the PEO?
Mr. Carroll: Sure, yeah. It was kind of interesting. I really, funny enough, was drafted during the Vietnam era draft. And I went to the Army, got drafted in the Army and served there. And so I went out of the Army, learned I should go to college out of that experience; went back to college; took the PACE exam, which was a government exam at that time where you qualified for -- if you got the high score you qualified and you could get accepted in the government. And I applied for that because having a job was very important back in those days with the economy the way it was.
In applying for that, I circled �procurement� or �contracting� because that�s what I did at the University of Maryland, where I went to college. I was acquiring for a cyclotron machine, which is a particle accelerator that was actually in the building, the physics building of University of Maryland. And I acquired semiconductors, diodes, all those kinds of products back then. When I checked that box, then I got selected by the federal government to come in the Department of Transportation and procure -- again, procurement or contracting.
And I kind of specialized, I went to the Coast Guard and specialized in IT. And the Coast Guard was one of the first organizations really that was heavy buyers of enterprise kind of solutions for information technology. That led me on to the Army, where a guy named Dave Borland, who was really responsible for moving the Army and the information technology and had a reputation for being one of the best contracting people in the field; led me to that area.
I grew up through the contracting ranks, worked in an organization called ISSAA and became an SES there, a senior executive there. And then I moved from there to CECOM up at Ft. Monmouth in the acquisition arena still, procurement arena. Then I went to Army Materiel Command and broadened my experience beyond just contracting, much more in the acquisition program management, a little in research, a lot more in the technology industrial base. And then I really moved from there to this job at Ft. Belvoir that I currently have, which is overseeing program managers.
So it was a little different makeup. It�s a crossover, and I think it�s occurring more and more in government now, but we�re having crossover specialists, so you don�t necessarily have to grow up as a program manager to manage program managers, you can come from different professions that have a relationship to that field. And so I was able to cross over. And I�ve noticed more and more people are doing that, like people that are engineering-focused, but have leadership skills and have management skills, they�re starting to move over and manage not just technology, but manage people and providing more of a service solution instead of a technical solution or -- you see more and more of this in life. So for me it�s been a good experience, and I�ve really enjoyed it and, you know, it�s been fun.
Mr. Lawrence: Was there a point in your career or a job in particular where you began to realize you�d be shifting from a subject matter expert, your own skill, to a leader of teams that you described, you know, pushing the leadership skills?
Mr. Carroll: Yeah, you know, really I was sort of -- well, first thing off, I always got assigned jobs it seemed like that were hard ones, that were systems in -- programs in trouble, systems in trouble. And I was lucky enough to get people working with me who were motivated to really get those kind of things done, so I was always had kind of a good team of people around on these various projects that I had experienced in my career. So I sort of was always in a pretty good position to be able to get things accomplished and done that helped me personally and then helped us help the Army get those jobs back on track and moving again. So that ability to effect change and lead teams and get relationships going among people that maybe weren�t having such a good relationship at the time, all those things I think kind of led to it being -- led to me actually getting more into management and leadership than just being a technical expert in a particular field and, you know, I enjoy it.
I mean, I like people and I think all people, no matter if they�re industry or government, you know, that everyone has the capability of doing things and wants to do the right things. And if you can motivate people to where everybody is contributing, then you�ll get that performance and you�ll get that need. And open communications, if you can get people to talk and share and express their fears and frustrations and get all that out there and get it focused, I think there�s more chance that you�re going to be successful, you know, in any job really.
Mr. Lawrence: That�s an interesting point, especially about expressing our concerns and frustrations.
How does technology affect the service members who are currently deployed overseas? We�ll ask Kevin Carroll, the Army PEO for enterprise information systems, when The Business of Government Hour returns.
Mr. Lawrence: Welcome back to The Business of Government Hour. I�m Paul Lawrence, and this morning�s conversation is with Kevin Carroll. Kevin�s the Army program executive officer for enterprise information systems.
And joining us in our conversation is Brian Dickson.
Mr. Dickson: Kevin, what are some of the key information technologies that are changing the way the Army does business?
Mr. Carroll: Well, there�s -- the Army right now is really undergoing a massive transformation. And that�s not just in my area, but across the Army as we try to become a lighter, more agile, more module force. And, you know, we have plans for the future, like future combat system is a big Army initiative, where we can bring Net-centric platforms that can really improve the ability to hit our targets, the ability to save lives, the ability to move quickly. And all those are big technology efforts that have information technology included in them. Actually at the core of a lot of it is the ability to see, know where your enemy is at, know where you�re at, and the ability to be able to strike quickly and get out of there quickly, too.
So all that future technology that the Army�s working on, mostly in the labs today and with industry, is trying to move the Army forward. And so there�s a whole push to kind of do that future combat system effort in the future.
What�s happening right now is there�s a big push for technology implementation in the current structure that we have, because everyone coming back out of Iraq and Afghanistan knows that we have to solve problems today. We can�t be waiting another 5 years or another 10 years, we have to move today. And so there�s been a big push on creating the ability to do that. And in our world, in our particular world, that really is in the communications area, the technology to improve bandwidth.
You know, we still have a problem in our world of getting the bandwidth we need in the isolated places we go in the Army. To get that -- the ability to do our web-based application stuff, we have to have bandwidth or we�re not going to be able to operate effectively. So we need the bandwidth, so communications is going to be a technology that�ll continue to be pushed over the next couple of years for us. It�s going to be pushed forever really, but over the next couple of years for sure, we�ll spend some money to do that.
Information assurance. We continue to, as you all know, continue to get attacked on the information infrastructure. We have some great people that are really working really hard to protect the network from intrusions and attacks. And I think that whole information assurance area, the technology in that, is going to continue to be needed and to be a big growth area for us.
We�re also doing enterprise resource planning tools, ERPs, the SAPs, the articles that people saw, those kind of solutions across the Army, because we really do want to change the way we do business. We practice in pretty much all of our areas, personnel, logistics, medical; we�re still practicing old business practices, some coming from World War II that have not really made that big dramatic change. And we want to change the way we do business. We want to be more business-like in how we conduct those applications -- how we conduct those business processes. And so this movement towards the ERP solution, like industry did, is a big thing on our plate for the next couple of years. And for us, that�s a growth area I think that you�ll see continue across all of our programs.
And then the other issue�s training. We�ve really trained -- it�s not so much a technology issue, but what we�re finding is that we can create great software products, we can take them out to the field. We do conduct training on the actual application, but what we don�t really conduct training on is the business process change that�s going on. And we�re going to have to spend more time and more money in training and making sure that the soldiers that touch our equipment really can understand what they�re getting and how that changes what they�re doing in their business-day lives every day and really make our systems more effective as a result of that, more user-friendly to them, much more capability than they have today. And so I think those areas are going to be big over the next couple of years while we continue to work for the big future, and that�s more along the lines of how does all this get tied together in a big network-centric manner?
Mr. Dickson: As you said, much of your effort is focused on modernizing the Army�s business systems, the so-called back-office systems. What kinds of impacts will these efforts have on the soldier, especially the deployed soldier in Iraq and other forward areas?
Mr. Carroll: Well, actually on some of the systems that we have in Iraq and Afghanistan today, it actually saves lives. Interestingly enough, you wouldn�t think that for a business system or a combat service support service, but we -- for example, we field a system called movement tracking system, which a is global positioning system, but it also allows you to do two-way messaging from the truck back to headquarters, back to the States actually, and it provides some visibility of asset management -- of your logistic stuff.
And we have had cases in Iraq where when we were moving -- the logistics guys were following the war fighters towards Baghdad. And in those moves, we had the ability for people that had the units, there were some that didn�t have the units, but the people that had the units had the ability to -- we knew where they were at, we could direct them away from the fight. When they were in trouble, we could redirect them, the Jessica Lynch kind of story, you know. We don�t know this for sure, but we know they didn�t have a movement tracking system. They were in a logistics group. If we had had that capability in that truck, we might have been able to notice they were going the wrong way and try to redirect them. That has happened. People have called in support when they�ve been attacked because of that system.
So some of these business systems are crossing over into really that area of lifesaving that you would expect normally from the other PEOs, my sister PEOs, that are really focused more towards survivability and destruction in a sense. And so for us, that�s a big thing.
The medical, the MC4, we have a medical system that�s in Iraq that�s patient care, where the medic has the handheld medical record of the soldiers in their unit, and they�re able to use that system. And that�s helping to get quicker action and get a soldier keyed up for being redeployed back to a hospital, to, say, a MASH unit, where they could really get support with all that data collected at the time of the injury or the time of the initial examination of the patient. So that�s a big system.
And of course, logistics. I mean, as you know, without fuel, without the ammunition, without food and water in particular in Iraq and Afghanistan, you know, you�ve got to have that or you�re not going to win. And our logistics systems have taken on much more of a visibility into the fight now than ever before. And so for us, I mean, there�s no better really payoff in our world now than today for the war fighter and how we affect the war fighter.
So our whole view of being an installation-based, you know, taking care of the people in the office that do supply and maintenance and personnel, all that�s out the window now. We really are focused on how does all this benefit that war fighter and that soldier, the man and the woman on the ground that�s doing the fighting for our country. How do we get the stuff that they need from our systems to help them be successful?
Mr. Lawrence: You talked about Iraq. I�m curious, you know, how many of your employees are actually stationed in Iraq? And then what are the logistics of sort of managing this global team?
Mr. Carroll: Yes, it has been a challenge. Actually, we have about 135 people in Iraq and Afghanistan today. Interestingly enough, the large segment of those are contractors that support our information technology systems. A lot of them are in communications because that�s obviously an important thing for us, but they�re also in the medical system, logistic system, you know, we�re involved across the spectrum.
What it�s done to us lately, though -- when the war came about, not only with the planning for it, but then in execution, it obviously reprioritized what we�re doing. Everything�s focused on the Iraqi OIF, Operation Iraqi Freedom and Enduring Freedom. That�s kind of our priority. We�ve realigned our money along those lines. We�ve realigned our efforts, our focus. Those are the things that we�re really doing, and that�s forced us to really balance what we want to do for the future because we don�t give that up, you know, move into business process, change for the future of the Army. But at the same time, we want to take care of the immediate needs of the soldiers overseas, and that�s kind of been a priority issue.
It�s been a little juggling that has to occur as to how much goes for the current fixes and how much for the future. And so it�s not an easy decision for our customers who really make those decisions for us as to where they want to put their money and what they want to invest in. The supplemental that Congress gave us really has helped in that manner, because that provided money that really allowed us to do some of the current efforts that are ongoing today in Iraq and Afghanistan. So that really did put a spark into doing stuff currently without too much of a disruption to the future.
Mr. Lawrence: As I understand it, you�re also involved in Iraq with rebuilding the commercial infrastructure.
Mr. Carroll: Yes. We have a program, it�s called KICC, Kuwait-Iraqi Communications Center, that we�re working to put really infrastructure for three groups, communications infrastructure for three groups. One is our U.S. forces. We just finished the build-out of a fixed communications. So we�re taking what the Signal Corps officers in the Army took over to Iraq. We�re in there today now making that permanent, putting better equipment in, making it a better performance, and then turning it over to a contractor-run facility so that those soldiers can come back. And we�ve actually already had a brigade that has come back as a result of that effort, so we�re spending a lot for the U.S. Army to get the fixed communications infrastructure in place.
And then another piece of that that we�re spending with the coalition partners, you know, the English, the Polish, all the people that are over and helping us in war and making sure that that backbone that we�re putting for the Army, that they are connected with that effort. So we�re spending time with the coalition.
And then recently, we took over for the CPA, for the Coalition Provisional Authority, working with the State Department and DISA, which is the DoD communications infrastructure. And we�re working right now to build up the coalition infrastructure, both in the embassy and in what they call the Green Zone, the safe zone, sort of except shots come in there every day, but the Green Zone area, too, to build that infrastructure up for the authority to be able to do their thing.
So we have a really big effort, people that are really working long hours and taking risk, both contractors again and government, who are really trying to get that infrastructure in place. So that program will continue this year, and our belief is it�ll even continue into next year. We�re trying to build up that infrastructure and commercialize it.
Mr. Lawrence: That�s a fascinating point. I didn�t realize you were doing so much overseas.
The latest acronym is ITES. What is it and why does it matter? We�ll ask Kevin Carroll, the Army�s program executive officer for enterprise information systems, when The Business of Government Hour continues.
Mr. Lawrence: Welcome back to The Business of Government Hour. I�m Paul Lawrence, and this morning�s conversation is with Kevin Carroll. Kevin�s the Army program executive officer for enterprise information systems.
And joining us in our conversation is Brian Dickson.
Mr. Dickson: Kevin, we�re hearing more and more about the importance of joint combat operations involving all the various services. What are you doing in your work to ensure greater interoperability between the Army systems and those systems of the other services?
Mr. Carroll: That�s a good point, Brian. These last couple of years in particular have been -- we the Army have really spent a lot of time working in the joint community. We realize that the joint community really does call the shots. We want to be interoperable with where the whole Department of Defense is moving and to include with our coalition partners. And so in the design of our systems today, we�re not doing anything that does not get the approval of what we call the domain owner, which really is the DoD responsible party for their architecture.
So for example, if we�re doing logistics work in the Army, which we are, the architecture we�re using within the Army, we take it to DoD, to the DoD logistics organization and get its blessing that we are fitting within that architecture from the DoD perspective. So as the Navy and the Air Force are building their solutions for logistics and our solution, we all interoperate within a common architecture. And we�re doing that in personnel, we�re doing that in the finance, and we�re doing it in the information technology arena.
So we�re really spending a lot of upfront architectural time that we used to not do years ago to make sure that we have interoperability occurring, and that�ll help us do a couple of things. One is to reduce systems, get rid of duplication that we do have. Within the Army, we have it. Within DoD, we have. So we�re hoping that�ll help on that issue.
It�ll provide the visibility that the joint commander needs today. And a lot of that came out in Iraq, the ability to see supplies between services, for example, in our area; the ability to access, you know, not only ammunition, but the food and the fuel and parts for -- you know, we had a big issue for tracks, remember, for the -- we were breaking and not getting the production out of tracks for our tanks, and that was a big issue that we needed -- we were finding -- anyplace we could find a track, we wanted to see that and the joint commander wanted that. And so by having our information technology systems where they�re able to go view that, hey, that�s in Germany, let�s get it over to Kuwait or Iraq immediately, really was a big payoff. And so all of that having the systems tied together so that the commander can direct the troops is very, very important. How we ensure that we�re doing all that stuff, like I mentioned, is architecture.
We also have an interoperability, joint interoperability requirement in all of our programs. And that requires us that prior to deploying a program, we have to get a blessing from the joint community, the J6, we call them; but basically, it�s the information technology part of the Army at the Joint Staff, that our system is interoperable with their architecture and the things they want from a technical perspective. And we test for that as part of our testing process, and we have to get their blessing that they�re satisfied that we�re meeting the standards, the goals, and the architecture for the IT information system stuff. And that really helps bring about what we all want, which really is when it comes time for the fight, it doesn�t matter what service, what uniform you have on, we�re together, one unit, and the commander can direct and not have to play around with 10 or 12 information technology systems to get the answer that he or she needs to get the job done.
Mr. Dickson: I understand that the Information Technology Enterprise Solutions, or ITES, initiative is an important focus of your organization. Could you tell us about ITES?
Mr. Carroll: We started a while back. In the Army, we�ve had a number of contracts that we�ve been doing through the Army, small computer program, which is under us. And basically, they were commodity contracts. So either commodity for products or even commodity for services, for labor. And that was kind of the approach that we had been taking in the past. And that allowed all the users within the Army open to the Department of Defense and even open to outside services, like GSA and places -- other government agencies, and they could order what they needed to create something. But as we started within the Army having this need to consolidate our information technology systems and to begin approaching things in an enterprise manner, it really led to us to start thinking we really don�t want commodities.
What we�re really looking for is solutions to problems that we face and that industry has already faced in their consolidations within their corporate structures, and so kind of we�re doing the same thing. And so the idea was how can we create a contracting vehicle that would help us to begin focusing on solutions to a problem and let industry have more choices when they propose to us on how they could go about solving a particular solution based on their experiences that they�ve had with other corporate and government customers? And that led to this idea of an information technology enterprise service contract.
And we still -- it�s broken into two pieces. One piece still deals with the commodity area: the servers that are needed for consolidation, a lot of the technology, communications equipment, the things that would be needed to consolidate, let�s say create a web server form, for example, that kind of technology. And we award it to some real high-quality vendors on that piece of the contract. And that�s open forwarding, and anybody can order off of that.
The kind of the more interesting piece is the second piece, which is the solutions contract piece. And again, we spent a lot of time, took our time selecting contractors that we felt could bring the value we needed to give us creative solutions to our technology problems. So we went through a detailed selection process and picked the vendors we felt very comfortable with. And the whole idea of this is that then we can write statements of objectives, kind of high-level mission needs with some of the performance expectations that we in government have, come out to industry, industry can come back using the technology off of the other contract, but using their brains and their services to put together a solution that really will, hopefully, move us quicker to the consolidation and help us really reduce cost, get performance up better on the systems that we have, and really lead us to this enterprise connection across the Army where we�re really trying to create one network, one virtual network, but one network across the Army.
Mr. Dickson: What are the major challenges that you see to achieving this vision?
Mr. Carroll: Well, actually, interestingly enough, the hard parts -- I mentioned about the statements of objectives. Getting us in the government to think through what we really are after at a high level is a bit challenge. We were better at actually kind of writing out what we know, like from a technical viewpoint, and these are the kind of things we want. And of course, that automatically and in industry�s case, they usually want to give us what we want, so they�ll do what we kind of tell them to do and the creativity gets squashed. And so we�re trying to really raise that up and have our guys sit through, think through exactly what we�re trying to accomplish here.
What would be a big payoff for our customers through these contracting vehicles once we got delivery of that services or that solution? And so that�s a big challenge, just to -- you have people step back, think big picture, try to write out the objectives, and really try to write out the how we would know if we�re successful or not, what would be our metric for success. And that isn�t an easy thing to do. It�s easier to give briefing charts about how to do it. It�s harder to actually do in your particular environment. And it requires that you get the right people there that can do that. Help -- I mean, we�ve turned to outside industry actually, a couple of consulting kind of organizations to come and help us think through that our ourselves, an outsider that can kind of work as that liaison between our players to help do that. I�d say that�s probably the one big challenge.
The other one is that assuming we get through that, and let�s say that we pick up -- a good example would be portal technology. Let�s say that we -- industry has outsourced a lot of their own web-based portal efforts. And so we could go out with some help and get the smart thinking and try to figure out what are the important metrics for running a portal and outsource that, let the vendors take it over, and then, you know, get better performance and better and lower cost even. So we can do things like that.
Historically, we in the government have been better at putting that at the start of a contract. We�re not so good at monitoring them, you know, and determine if we actually made the results over years or not. And part of it�s very difficult. The challenge is like people. A lot of times, our business case analysis of doing this kind of stuff says we�re going to lose X-number of systems administrators. And that�s true; in the real world, that is what happens. But in the Army, who owns those systems administrators is everybody. I mean, there�s tons of people that own them, they�re not under one hat. And so the ability to determine if that system administrator really went away or did they get reutilized for other priority mission stuff, it�s very difficult sometimes to capture the savings and verify the facts. So that�s the challenges.
Mr. Dickson: So are you attempting to tackle that problem?
Mr. Carroll: Yes, we are. We�re trying to really learn from industry, I mean, the experiences, because, I mean, industries have the same problem. And we�re trying to learn of what they�ve experienced as well as the other government agencies who have tried this and learn and trying to build a way into capturing that a lot better, to use a process where we really are finding a way to measure over time to determine if we�re doing it. Unfortunately, though, we�ve only been able to get through the decentralization of the government organization on how it manages money and people.
That�s still the big challenge for us is to really be able to -- we can determine -- I think we feel more comfortable now that we can determine where with 20 people running the system and now it�s being run with 4, as an example, we feel comfortable with being able to track that that�s true and we can measure that. We don�t know, though, if the Army the budget people would not be happy because we can�t really show them that there�s 16 peoples� worth of savings that went somewhere. And that still is a challenge and I haven�t figured out -- I or the -- I don�t think the Army has figured out a way to kind of solve that problem as of yet.
Mr. Lawrence: There�s much talk these days about performance-based contracting. However, our guest has actually been a leader in this area. So what is it and why is it important? We�ll ask Kevin Carroll, the Army PEO for enterprise information systems, for his perspective when The Business of Government Hour returns.
Mr. Lawrence: Welcome back to The Business of Government Hour. I�m Paul Lawrence, and this morning�s conversation is with Kevin Carroll, the Army�s program executive officer for enterprise information systems.
And joining us in our conversation is Brian Dickson.
Mr. Dickson: Kevin, we�ve been talking about the importance of ITES, the Army�s enterprise information technology initiative. I know it�s early in the program, but do you have any lessons learned to date that you could share with us?
Mr. Carroll: Yes, Brian. I�d say the big thing that we learned was how important it was that the effort not be done in a vacuum, and that we really work as a partner with the Army CIO, which we did for the ITES program; Netcom, which has recently stood up under the Army CIO as the network operators. They�re basically going to be responsible for operating the network for the whole Army; a big job. And we knew that whatever we would build as an acquisition organization, they would have to run, so it was very important that we brought them in with us earlier on and help us with the requirements, help us with the source selection, and help us with the evaluation. So it was critical that we got their involvement with it as well as the contracting organization.
We used ITEC4, which is basically an information technology E commerce group within the Army, and they really helped us get the contracting strategy put together and make things happen from the contractor viewpoint. And then, of course, our relationship with CECOM again, our engineering effort, the guys at Ft. Huachuca who helped us write the requirements, really helped us get things going. So that was within the government, very important that all the players be together through that process.
And then another key part as we went through that was going out to industry as we developed pieces of what we were doing with our strategy and the requirements, and to really go out and get industry feedback back into that process so that we made sure. And we did modify our procurement strategy based on a lot of that kind of input, and that was really key to do. And so that helped us I think get procurement tools put in place in a good manner and helped ensure that we got the right guys to do the job from a contractor perspective. And now our next step is to actually deliver the results and show that that vehicle will assist us in getting the program things we want done at an enterprise level completed.
Mr. Dickson: Kevin, you�re known within the Army and within DoD as a very strong proponent of performance-based contracting. Could you explain to us what this concept is and what are the benefits to the Army?
Mr. Carroll: Well, thanks for that compliment. The truth is every -- I think in performance-based contracting, everyone�s a pioneer and there�s very few settlers, because it�s a tough, tough area to do. And we want to do it. We certainly have the motivation in our organization to do more performance-based efforts, because we think it�s rewarding to the contractor community, it�s rewarding to us, things get done faster for the soldier in that regard. So we are proponents of it.
The definition of performance-based contracting is kind of all over the place. I mean, you know, there�s actually courses where everyone has a different definition depending on who�s teaching it on what performance-based contracting means. But basically it�s risk, shifting risk over and letting control go to -- that�s the hard part for the government -- control go to the industry to be able to deliver the results that we have. And it can be any type of -- it can be a fixed-price contract or seat management approaches, paper delivery, paper service kind of contracting. So there�s a whole bunch of different ways of doing it, but none of that is as important as this idea of how do we allow the freedom for innovation, allow the freedom for delivery of the services so that industry can do its thing in their best business way that makes sense to do it, and then we the government can monitor those end results that we�re looking for in order to ensure that we�re getting it, and pay or not pay for those end results when they�re contractually due. And so we really want to try to change the way we�re doing it.
I�d like to be able to tell you that we have tons of successes that I can point to. We�ve been learning. We�ve had some successes, we�ve had some failures on our contract mechanism using performance-based contracting techniques. And there�s a lot of factors to what�s successful and not. Part of it is the way the contract was written. Part of it was the government players involved, the government people involved. Part of it were the industry guys, how committed they were to really doing that. Were they willing to live up to it when they got in trouble to what they committed to? All those things are factors that have -- like I said, sometimes we�ve risen to the occasion and it�s paid off, and sometimes it hasn�t. So it�s a very tough area, but we�re committed to doing it in our program office and we�re going to continue to push to make that happen, and we believe to the benefit of all.
Mr. Dickson: Kevin, what do you see as the future of the business in the combat support services area in the Army?
Mr. Carroll: We believe we�re a growing business. We�re in business. We know our revenue�s increased quite a lot over these last couple of years because we have more customers that are interested in doing enterprise things. And so what we see as critically important now is -- which we mentioned before, was the joint flavor to everything we do. And I think that the combat service support area is going to become more and more joint solutions, you know, the inoperability issue we talked about, all those are critical that we do that. So I think that�s going to be a big push.
We�re going to continue the web-basing and the commercialization of our products. And as you know, in the Army, and this is true in the Marines as well, less so in probably the Navy and the Air Force, but we always have to have the ability that we�re not going to have communications. So we always have to have some ability to keep our functions going without comms, communications, because when we�re running somewhere, like Baghdad, we�re not always going to have communications on the move, although that is a desire for us in the future to do that. So we have to do a little bit of design outside the normal commercial manner, but basically we want to be more commercial-like, web-based-like, and be able to use those systems. And I think that�s going to grow across all those combat service supporters. The need for communications is going to continue to grow for our area.
The Army�s actually working right now in the LAN warrior (?) network effort that Gen. Boutelle has underway, working with the logistics community on a connecting and logistician program that will allow us the ability to get more communications out not just to the logistician, but really to the medical community and the other CSS world, and that�s an important area for us. Some day, we do want to be able to be on the move and have satellite communications, and I think that�s going to be a big growth area in the future.
And cross-functional integration; in other words, the logistics community, the personnel community, the finance community, the procurement community, they�re under -- integrating within their stovepipe or within their community today. My job is to help our customers look actually beyond that and how they interrelate to each other, because they all take data from each other to do that job, and we don�t want them recreating data. We want to have a single source for that data and then have these -- and integration occur across those platforms. And that�ll be a big thing for us, to get to that big issue where the data the soldier looks at is believable, is accurate data, timely, to where it�s data they believe that when we say Part X is in that warehouse, it�s actually in that warehouse; or we say, like, we need people of a certain skill to come to Iraq to do something, we can find that soldier at Camp Such-and-Such with our systems, because that reliability would be so high.
And that�s been a difficult challenge for us, because a lot of people don�t believe the data. And like in logistics is a good example of this, people over-order only because they�re not sure if what they looked at was right. And as we�re tracking in-transit visibility, as we�re looking at parts coming in, which we�ve really done a lot better job, but a lot more to do on tracking parts coming into theater and being distributed within theater, we want the people looking at that data to believe it, that it�s true. And we�re getting there, but there�s still more growth to occur within that community. So I think they�re going to be the biggest things in the combat service support area: the jointness, the web-basing commercialization, and improving the cross-integration.
Mr. Lawrence: Kevin, you�ve had a very interesting career in public service and I�m curious, what advice would you give to someone interested in coming into government?
Mr. Carroll: Well, working in the government is one of the most challenging things that can ever happen to a person. I mean, I spent my life basically in it, so I�m a little biased, but there�s no place that I�m aware of, there may be a few companies, but there�s no place -- really if you come into the federal government and you have energy and you want to do things, you�ll be given authority to move out and go do things. I mean, we�re looking for people to empower and to move. And it�s -- you�re working on a mission that -- you know, it�s a mission focused on lives in the Army�s case, but really throughout the government, be it GSA or HUD or wherever you might work, I mean, it�s all focused towards service to the citizen. And I think you really can�t have a better feeling for what you�re doing and what you�re contributing to for the nation. So it�s very challenging.
Plus, my experience has been is it�s fun. I mean, it�s an enjoyable thing. You have good people that you work for. I�ve said always that you got to look for a job that you enjoy, where people trust you, and where you can move out and do things. And you�ll move up pretty quickly. You never make the -- maybe the big dollars that a lot of people believe they make in industry, but the fulfillment well makes up for that.
We still are a stable place to work. I mean, the federal government is still -- you know, there�s a good and a bad to that, but the good to that from a prospective is it does provide you a baseline where you can grow from and you don�t have to necessarily worry about the stock market or other things that might trouble other employees in the industry. So I think it�s a really good place to go. And I know we are always encouraged by people that want to come work in our organization.
Mr. Lawrence: Well, that�ll have to be our last question because we�re out of time. Brian and I want to thank you for joining us this morning.
Mr. Carroll: Yes, and thank you very much for taking the time and doing this for me and my organization and the Army. And if you�d like to learn more about our organization, if you go to www.eis.army.mil, m-i-l, you can find out about our programs and the people that run our programs. And so thank you very much.
Mr. Lawrence: Thank you. This has been The Business of Government Hour, featuring a conversation with Kevin Carroll, the Army�s program executive officer for enterprise information systems.
Be sure to visit us on the web at businessofgovernment.org. There, you can learn more about our programs and get a transcript of today�s fascinating conversation. Once again, that�s businessofgovernment.org.
This is Paul Lawrence. Thank you for listening.
Thursday, March 11, 2004
Mr. Lawrence: Good morning and welcome to The Business of Government Hour. I'm Paul Lawrence, partner in charge of The IBM Center for The Business of Government. We created the Center in 1998 to encourage discussion and research into new approaches to improving government effectiveness. You can find out more by visiting us on the web at businessofgovernment.org.
The Business of Government Hour features a conversation about management with a government executive who is changing the way government does business. Our special guest this morning is Norm Enger, E-government program director in the Office of Personnel Management.
Good morning, Norm.
Mr. Enger: Good morning.
Mr. Lawrence: And joining us in our conversation is Tom Romeo, also from IBM.
Good morning, Tom.
Mr. Romeo: Good morning.
Mr. Lawrence: Well, Norm, let’s start by sort of focusing on the mission and the activities of OPM. Could you describe for our listeners what OPM does?
Mr. Enger: The main job of OPM is to build a high-quality and diverse federal workforce based on merit system principles. To do this, OPM works with the President, the Congress, departments, and agencies to help them to develop and implement good human capital policies that in turn let the agencies meet their strategic objectives. OPM is essentially a consulting organization that guides the federal government, the civilian sector, to improve how it works with, manages, and guides development of human capital.
Mr. Lawrence: So you would characterize the relationship between OPM -- you use the word “guide.” What’s the relationship between OPM and, say, the rest of the federal government? How would you describe that?
Mr. Enger: Well, the OPM has the mandate, if you will, to give policy guidance to the civilian sector of the government, the human capital officers throughout the civilian sector, to properly manage their personnel and payroll systems, and all the systems that deal with the federal employee.
Mr. Romeo: Can you tell us a little bit about your role as the E-government program director for OPM?
Mr. Enger: My role is the E-gov program director, and the OPM received five of the 24 original E gov initiatives. The five E-gov initiatives, which we’ll talk about shortly, deal with human capital. The mandate of E-government is to transform government business systems. Therefore, in this context, the OPM initiatives seek to transform the human resource, the human capital systems, in the federal agencies. What is interesting in this context is that OPM, I believe, has been successful in this mission because we are the second agency to achieve green status, which is given by OMB to agencies that meet all of their criteria and milestones for E-government. So right now, we have just achieved green status in E-government.
Let me also add that E-government is a little bit unique in the sense that what we’re talking about is not minor Band-Aid changes to systems; we’re looking at transformational change, which means major, radical change to how the government does business. What’s also very relevant here is we’re talking about change in a very short space of time. E-gov has objectives to transform systems within 18 to 24 months. We wind up with a very, very ambitious schedule to accomplish these things.
I work very closely with the director of OPM, Kay Coles James, the OPM officials, and the agencies to, in effect, put into place and implement the vision of E-government. I also, of course, work closely with the CIO of OPM, because we have to work within the infrastructure developed by the OPM’s CIO.
Mr. Romeo: I know in other agencies, there are also E-government lead positions. Can you talk a little bit about some of those positions and the advantages of having such a role?
Mr. Enger: Well, there were, as I said before, 24 E-gov initiatives. Every agency that has an E gov initiative has assigned a project manager for the initiative. This is because of what I said earlier; namely, you’re looking a radical change in a very, very short space of time, 18 to 24 months. Therefore, to accomplish that, each of the 24 initiatives has a project manager, and each agency that is a managing partner, such as OPM, has assigned a manager for that purpose. These are really government-wide in scope, so just because an agency has an initiative, it means, in effect, the agency is responsible for working across the government to provide a government-wide solution. The perception here is not agency-centric, but government-wide. So as we’ll talk about in a few minutes here, what we have developed from OPM are used throughout the federal government, not just by OPM.
Mr. Romeo: Thanks, Norm. How many employees would you say work for the E government program at OPM, and what kind of skill sets do they have?
Mr. Enger: I have approximately 60 individuals working for me in the OPM E-gov program. These 60 individuals are a combination of full-time OPM personnel and contractors and detailees. The E-gov initiatives really require quite a spectrum of skills. We have IT specialists, human resource specialists, risk management specialists; a wide range, security specialists, privacy specialists. We really wind up with a mosaic and quite a spectrum of people required to effectively design, develop, and implement that E-gov initiative.
Mr. Romeo: Can you tell me a little bit about your career prior to joining OPM, and what type of skills do you think best prepared you for the E-gov program lead at OPM?
Mr. Enger: Well, my background has essentially been private sector. I ran my own computer system integration firm for many, many years, for over 20 years, providing basically systems and E-commerce solutions to federal and commercial clients. My firm was acquired about four or five years ago by Computer Associates, a very large system software and business software firm. And I therefore wound up running a smaller firm and then working as a vice president for a very large firm.
And then what happened is that approximately two years ago, I got a call from the chief of staff of OPM, asking me to come down and talk to them. I was quite unprepared for this. I went down, and essentially, the chief of staff and director asked me if I would be interested in public service. And I’d always had some interest in this, but never really focused upon where I would do public service. I met and talked to the chief of staff and the director, and was very impressed by their vision and their dedication to transforming federal systems, and I was asked to interview for the position. I interviewed, among other people, and I was selected to become the OPM E-gov program manager.
I must say that my prior many, many years in the business, and especially my private sector background with IT, information systems, for many, many years prepared me very, very well for the current position.
Mr. Lawrence: When you think about your days in the private sector, how would you compare the management styles used in the private sector versus the public sector?
Mr. Enger: Well, I was a bit surprised that in reality, the difference is not that dramatic. The senior executives in the federal sector are judged upon such qualifications as leading change, leading people, results-driven, business acumen, building coalitions. Well, these are very, very much the same criteria used to judge successful managers in the private sector. What has happened is that the government is more and more looking to the private sector for metrics and ways to improve its operations. I see more and more the transfer of solutions, metrics, and ideas from the private sector into the federal government. So therefore, in that sense, I don’t think at this point in time, you’re talking about a dramatic difference in the criteria or the mode of operation of successful federal people or private sector individuals.
Let me also mention that I was very, very pleasantly surprised to find when I joined the government that I had five project managers that were very, very talented. I was very impressed by the caliber of the people I had to work with, working for me. And I remain very, very impressed by the dedication and the hard work and the results of the people working for me in the federal sector.
Mr. Lawrence: Let me ask the question again, only this time focusing in on your technical skills, because you describe your experiences of leading technology organizations. How about comparing potential differences between creating technology solutions in the public sector as opposed to or compared to creating them in the private sector?
Mr. Enger: I don’t see a fundamental difference in the process of creating technology solutions in the public versus the private sector. In general, the private sector, though, is where you have the great breakthroughs in IT technology in terms of new software solutions, new hardware solutions, new communications solutions. So in general, the private sector is the leading edge, and the cauldron, in effect, where you have most of the breakthroughs in technology.
One goal of E-government is to look for the best solutions, whether they be public or private, and then implement the best solutions. What we do is we look carefully at a solution to a business problem in the government, and also outside. We do studies and then a cost/benefit analysis and then we determine where is the best solution, federal or private sector?
Let me add that my E-gov initiatives have very, very much used the private sector. We’ve outsourced a number of operations to the private sector. We’ll talk some more about this when we discuss USAJOBS E-training. But in effect, we have, under my five initiatives, used off-the-shelf commercial software and we’ve outsourced several operations from the public to the private sector.
Mr. Lawrence: That’s an interesting point, especially about the cost comparison.
What is golearn.gov and why was OPM recognized for this work? We’ll ask Norm Enger of OPM to tell us more about this when The Business of Government Hour returns.
Mr. Lawrence: Welcome back to The Business of Government Hour. I’m Paul Lawrence, and this morning’s conversation is with Norm Enger. Norm’s the E-government program director in the Office of Personnel Management.
And joining us in our conversation is Tom Romeo.
Well, Norm, could you describe the E-government vision and how the six OPM E government initiatives relate to the employment life cycle?
Mr. Enger: Well, what we have done is we took the five original E-gov initiatives, and the five which we can talk in more detail deal with recruitment of federal people, training federal people, their personnel systems, their payroll systems, their security clearance systems. The original five deal with those five discrete areas. And if we think about it, that frames the employee life cycle from recruitment and eventually into retirement. I should add also, our systems feed into the retirement system, which is managed and run by OPM. So we were able to effectively communicate a vision of the employee life cycle to the agencies and to the human resource people in the federal sector.
This is very important, because one of the difficulties IT people have is we talk in acronyms and jargon, and very often, we lose the audience for our vision. By framing the OPM initiatives into an employee life cycle, we’ve been able to very effectively convey what we’re trying to accomplish to the human resource officers in the federal sector.
We also have a sixth initiative, and that is called HRIS, Human Resource Information Systems. What that really is is going into a phase two, if I can use that term, of E-government, and that really now is looking at an enterprise solution for the entire human resource piece of the federal line of business. We’ll talk about that a bit more later.
Mr. Romeo: Let’s talk about the six initiatives in more detail. Since recruitment is at the beginning of the employment life cycle, can you describe the recruitment one-stop online service?
Mr. Enger: The recruitment one-stop initiative basically has a role or a mission to help the citizen find federal jobs. We want to simplify the process of locating and applying for federal jobs. When I came on board about two years ago, the OPM ran an old legacy system site called USAJOBS. The initiative has completely replaced and transformed that site. In August of last year, we brought up a brand-new actually outsourced site, using commercial off-the-shelf software; radically changed the old site. We actually shut down the old site.
I might add that this took place in August, August 4th, I believe, of last year. And I was apprehensive, because shutting down a complete site and then going live with a new one, there is some risk there. We shut down the old site on a Friday, went live on a Monday morning. And to my great surprise, on the Friday before, on the old site, we had 20,000 people a day on the site; on Monday, we had 200,000 people on the site. We increased the volume tenfold over that weekend from the old to the new site. I must say, to my great happiness and satisfaction, there wasn’t a glitch at all. The site went fully operational, and it’s simply grown in utilization. We now have 60 million citizens a year go to our USAJOBS site to locate federal jobs, put in résumés, and also to look and see what’s available relative to positions in the federal sector.
This has really improved the hiring process, because one of the real passions of Director Kay Coles James is to fix the federal hiring process. And what we’re doing here is we have replaced an old site with a brand-new site where a citizen can go, see what jobs are available, they can build a résumé. They actually now are able to track the application they file. They can see the status of the application.
We also have on the site here, we have all kinds of guides relative to helping them to determine what jobs they might be suitable for, help them with their career pathing. So in effect, we’ve gone and replaced an old legacy system with a very, very user-friendly, vibrant, and very successful new job site called USAJOBS. This site also is used by the agencies to -- we call it data mining. They can go in there and search for candidates for positions, and in effect, use that as a database, if you will, to see who’s applied for federal jobs.
Mr. Lawrence: Okay. So we just described the process of recruiting and hiring. So now once hired, a government employee is encouraged to build skills across a variety of subjects. And as I understand it, in 2003, OPM received a Distinguished Technology Leadership Award for the successful implementation of golearn.gov. Could you tell us what makes this a successful and innovative site?
Mr. Enger: Well, the concept behind the E-training initiative, and the website is golearn.gov, was to provide to the federal employee one-stop shopping for high-quality learning resources. Going back historically, in July of 2002, we launched a relatively humble site. I was standing with Mark Forman, and Director Kay Coles James gave the introductory remarks and we launched this site, which had at that time roughly 30 or 40 online courses, web-based courses. Since July of 2002, we have improved the site and it has evolved. So from a humble beginning, we now have well over 3,000 courses on the site. We have hundreds of E-books. As of last year, we had 30 agencies using this for their primary training. By the end of this year, we’ll have 60 agencies. It’s become a primary site for quality online web-based training for federal people.
The site itself is a -- it’s a virtual building with floors. And people can, in effect, go into classrooms and look at and take any one of these 3,000 courses. We have hundreds of books of all types, both technology and management and career-building and ethics, on the site. We have mentoring. People can have mentors help them to answer questions they have about either technology or about careers or whatever. We have resource centers that tie them to dictionaries, encyclopedias, libraries, et cetera. We now have over 1 million people a year actually come to this site and use this site. And actually, to my great surprise, the utilization is half civilian and half military. The site is running 24 by 7; it’s available full-time, 7 days a week. It’s used by federal people on every continent in the world.
And we have received numerous awards for this site. We received a very prestigious Gracie Award this year from our peers in the private and federal sector. So we’re very proud to, in effect, have a site which is delivering to the federal workforce an easy-to-use, available way to have continuous learning, to let the federal people continuously improve their job skills and make learning a process that is not difficult to reach, but becomes a part of their normal job pattern, per se.
Mr. Romeo: Norm, providing security clearances to federal civilian workers can be a very lengthy process, especially given the heightened importance of background checks since the September 11th incident. How does the government’s E-clearance initiative facilitate the security clearance process?
Mr. Enger: Well, this initiative, E-clearance, essentially wants to speed up and also improve the process whereby one gets a security clearance. When I first came on board two years ago, to my surprise, there was no central system whereby an authorized person could check security clearances across the government. What we did is, we at OPM, through this initiative, gathered into a warehouse all of the clearance information held by individual civilian agencies. We built this warehouse, and then in January of 2003, we linked this warehouse to a DoD system, called Joint Personal Adjudication System.
And the system I’m talking about, we call it the clearance verification system, CVS. And for the first time ever, you had a system which let a person who’s authorized inquire across the entire civilian and military sector for the status of somebody’s clearance. This system we built will hold 98 percent of all active clearances. To our great satisfaction, it was used by the new Department of Homeland Security last year to stand up and become operational. It used this system to do the background checks of the employees coming into that department from 22 different organizations. Roughly 160,000 employees were actually checked with this system.
A second part is moving all of the paper and forms for a clearance. For example, one form is the SF-86 you fill out. It’s a 13-page paper form to request a security clearance. We’ve made this electronic, and we’re making all the forms that people use for clearances electronic. By doing this, we’re moving from a paper system to an electronic system, and this cuts down the time it takes to get a security clearance, the time it takes to move information around, and in effect, the basic goal of E-clearance is to speed up and also to improve the whole process of security clearances.
Mr. Lawrence: This is a fascinating conversation of the life cycle, but we’ve got to go to a break.
Rejoin us in a few minutes as we continue our conversation with Norm Enger of OPM. This is The Business of Government Hour.
Mr. Lawrence: Welcome back to The Business of Government Hour. I’m Paul Lawrence, and this morning’s conversation is with Norm Enger, the E-government program director at the Office of Personnel Management.
And joining us in our conversation is Tom Romeo.
Well, Norm, we can’t talk about the employment life cycle without discussing one of the most important parts of employment, to the employees that is, the receiving of a paycheck, and that it’s current and consistent and timely. How does the E-payroll initiative help facilitate the government to do this in the most cost-effective manner?
Mr. Enger: Well, two years ago, when I took this position, to my great surprise, there were 26 agencies processing payroll for the 1.8 million civilian employees. I scratched my head, saying why are there 26 places paying these employees? The initiative essentially is to standardize and to consolidate civilian payroll processing. What we are doing is essentially we are consolidating civilian payroll processing from 26 down to basically two partnerships. We are collapsing from 26 down to two partnerships comprising four agencies, and eventually down just to two centers, if you will, that process civilian payroll. In the process, we’ll standardize payroll, but also, I might add, by shutting down these redundant operations, we’ll save the government, over a 10-year period, $1.1 billion. So in effect, we also don’t just achieve efficiency, but we also achieve significant cost savings by these initiatives. I might add that our partners here, the agencies that are in effect comprising the partnerships are Agriculture, Interior, Defense, and GSA.
Mr. Romeo: Norm, can you describe the vision, goals, and benefits of the Enterprise Human Resources Integration initiative? What is the EHRI’s relationship to the other E-gov initiatives?
Mr. Enger: Well, essentially, this initiative, EHRI, has several goals. Again, going back several years, I was quite surprised to realize that, from my point of view anyway, there really wasn’t a very rich corporate database on the civilian workforce. One part of EHRI, one goal is to build a corporate database or warehouse of real accurate information about the 1.8 million people in the civilian workforce.
Last September, September 2003, we actually brought up this new operation, this new website used by federal people. And what we have now is a richer and richer repository, describing in more and more detail the skills, the abilities, et cetera, of the 1.8 million civilian people. This is used for all kinds of workforce analysis, planning. We can look in there and determine retirement rates; we can do studies of age, sex, ethnic backgrounds, et cetera. So what we’ve done here is establish a corporate warehouse.
A second role of EHRI is to move away from paper personnel form. We call it the EOPF, Electronic Official Personnel Folder. What we’re doing is we’re leading the government in terms of showing the government how to get away from those voluminous and bulky personnel folders and move toward an electronic personnel record for the employee. Eventually when a person joins the government, there’ll be an electronic record created for them, a personnel record, and that will follow them through their federal career. So a second part of this is to, in effect, move toward an electronic personnel system.
To answer your question about its relationship, this initiative is defining all of the data elements that pertain to federal human resources and payroll. We have defined over 800 data elements that really comprise the standardization, if you will, of the information that is used in the federal personnel and payroll systems, and this also are the standards being followed by my other initiatives.
Mr. Lawrence: Norm, you’ve described the scenario where Executive Branch agencies may potentially invest in duplicative human resource information systems that perform core personnel transaction processing. For those of us who aren’t HR professionals, could you describe what a core personnel transaction process is? And then I’m curious, with this consolidation, you know, how you thought about, you know, the effect standardization will have on the government and others involved in the HR area.
Mr. Enger: The core personnel transaction processing is really the processing that updates the employee personnel record, the actions that update that record. This is called in the federal government the SF-5052 processing. This initiative, the HRIS, essentially is now moving toward an enterprise view of the human resource line of business.
Let me address it this way. We proved that the government could be transformed in a very short space of time. I think the original E-gov initiatives, the 24, have shown that there can be rapid change in the federal government. You can implement solutions in a very short timeframe. You can show tangible results, either dollar-wise or utilization. So in effect, this is really building upon the initial 24 and our five, I should say. And now we’re saying let’s look not just at those five points, if you will: training, recruitment -- look at the entire business itself of human capital in the federal government.
This HRIS is really using something that OMB has really pioneered called the Federal Enterprise Architecture. What that really says is that the OMB FEA is looking at the government as a business, just as you would look at a commercial private business, and what it’s done, looked at it across all of its operations and then defined lines of business: one being financial management, another one being human capital. And what we’re doing is we’re looking at the entire human capital line of business, what people do in the government relative to people and payroll. And what we’re doing is we are, within that context, looking at all the operations, all the business functions there. And now we’re looking to improve across the board, where we can, with better solutions and making the government more efficient and also to, in effect, improve how human capital operates in the federal sector.
Mr. Romeo: Norm, you just talked about the business processes and how they go across the federal government. All of the E-gov initiatives involve coordination of IT systems across the federal government, also. How is OPM working with other federal agencies to accomplish the goals of the different E-gov initiatives?
Mr. Enger: The agencies are right now all signing agreements to use wherever possible the 24 original E-gov initiatives. For example, we are on the Steering Committee, and we’re using E-authentication; another initiative. E-authentication essentially is used to credential or to identify who is on a terminal. That’s fundamental to all of E-gov, because E-gov depends on the Internet, on web-based services. So for example, in this one case, we’re on the Steering Committee and we plan to use the initiative.
The same thing goes with other initiatives. We’re using USA Services, an E-gov initiative, which provides help desk services to operations. So what’s happening here is that all agencies, including OPM, wherever possible, are incorporating and using other E-gov initiatives.
Mr. Lawrence: How much funding has been allocated to the E-gov initiatives?
Mr. Enger: Well, the OPM funding in 2004, we received approximately $10.8 million in appropriation. We also have fee-for-service operations for E-training and recruitment one-stop. So in effect, we have a combination of appropriations, and also, we have fee-for-service operations.
Mr. Romeo: What other critical success factors besides funding are needed to make these initiatives a success?
Mr. Enger: Well, when you have these initiatives, you obviously want agencies to shut down redundant systems and migrate to your initiative. Well, what happens here is you have to give tangible evidence that you have a solution. I think that a critical success factor is not just to say I have achieved success at E-training or USAJOBS or E-clearance, but you have to demonstrate and have a tangible, kick-the-tires proof that you have a solution. So step one in terms of a critical factor is you’ve got to be able to demonstrate a viable robust solution before people will shut down their old or redundant systems.
Another very important factor here is agency participation in the initiative. It’s very, very important that you outreach, that you work with agency partners. You go out and, in effect, you sell, you show what you’ve done and get buy-in from people that you’re asking to migrate to the initiative. So I think these two things: one, really have a solution, not smoke; and also to go out and really build up coalitions of support so people will use and migrate to your solution.
Mr. Lawrence: We left the conversation about E-payroll and the human resource information systems. The one thing I meant to ask was what’s the timetable for their implementation?
Mr. Enger: Well, for example, E-payroll, we have a target of September 2004, this year, for many of the migrations to be finished. We have at this point all of the agencies lined up for migrations, and we will pretty much meet the target of September 2004 for migrations.
Let me also add that in general, the plan of E-government is that by September 2004, the initiatives will graduate. And what that means, they’ll be operational. They’ll have achieved what the original goal was, is that from two years ago, the start, until September 2004, we have actually gone from concept to real operations. So the answer to you with E-payroll is, our target is September 2004, to, in effect, have finished many, many of the migrations.
The other one, HRIS, that you mentioned, this is really starting now. It’s a newer initiative, called a line of business initiative. And in fact, a task force for this is being formed for this as we speak, and I believe OMB and OPM will have an event on March 18th, this month, to announce the formation of this task force. And again, the task force and initiative, they’ll address enterprise solutions for the human capital line of business.
Mr. Lawrence: That’s interesting. It sounds like 2004 will be a busy year.
What’s the future of E-government? We’ll ask Norm Enger of OPM for this thoughts and perspectives when The Business of Government Hour returns.
Mr. Lawrence: Welcome back to The Business of Government Hour. I’m Paul Lawrence, and this morning’s conversation is with Norm Enger, E-government program director at the Office of Personnel Management.
And joining us in our conversation is Tom Romeo.
Mr. Romeo: Norm, we’ve talked a lot about the current E-government initiatives. In your opinion, what others do you think the future will hold?
Mr. Enger: Well, the vision of E-government is a government that is citizen-centered, not bureaucracy- or agency-centered, results-oriented, and market-based. The goal of E-government is to provide one-stop online access to the citizen to information and services. Citizens should be able to find what they want quickly, in seconds; not in hours or whatever, or days. A good example of this, for example, is the FirstGov website, where a citizen can go to a site and from that one site, they’re tied to all federal agencies; they’re tied to a variety of resources relative to grants, to national parks, to employment opportunities. So what we’re looking for here is to use the web, the Internet, to provide the citizen with very rapid -- three clicks or whatever -- access to a wide variety of accurate information that in effect provides them with first-quality service.
Mr. Romeo: How do you envision the government will conduct transactions across other federal agencies and/or state and local governments?
Mr. Enger: Well, what’s happening is that some initiatives are in effect dealing with the federal, state, and local situation. For example, one Homeland Security initiative is a secure portal that will deal with disaster management; in effect, dealing with disaster management and public safety, E-government is in effect developing systems and communications that link together federal, state, and local governments into one context, into one response to a disaster or public safety challenge.
Mr. Lawrence: Norm, you’ve been working in the field of E-government now for some time. What advice would you have for future leaders in E-government on how to be successful in this field?
Mr. Enger: I would advise future leaders in E-government to be aware that major transformations in federal business systems requires a full recognition of the need to build coalitions of support in affected agencies. Change management is a major factor in the success of E-government. Future E-gov leaders should not focus on technology solutions without recognizing the other dimensions of change necessary for success.
Mr. Lawrence: And how about in terms of a person considering a career in public service? You’ve been in both sectors, and you moved into public service after a long career in the private sector. What advice would you give to somebody interested in joining public service?
Mr. Enger: Well, I think this is a very exciting and challenging time for a young person to join the federal government. Our government faces challenges, even though we are the world’s greatest economy and have the world’s greatest and strongest military force. What is very exciting, and I think E-gov has made this possible, is that we have shown that you can transform government operations in a very, very short space of time. We can show that government can, in effect, reach out and, in effect, become more efficient, more effective, more responsive to the citizen population in a short space of time.
My advice to a young person considering a public service career would be to go and look at the OPM USAJOBS website. The site is www.usajobs.opm.gov. On this website, the person can locate a vast array of educational and job opportunities, all kinds of internships, grants, and job situations. Young people will be able to use the site. They can also on the site develop a job résumé to apply for a federal job.
Let me also add, there is also a Presidential Management Fellow program designed to attract into federal service outstanding young men and women from a variety of disciplines. Again, if the person goes to our site, USAJOBS, they will find more information about this PMF, this fellowship program.
Mr. Lawrence: Well, Norm, that’s our last question. Tom and I want to thank you for joining us this morning and being our guest.
And would you like to tell the people the website one more time, in case they’re --
Mr. Enger: Yeah, the website I mentioned earlier was www.usajobs.opm.gov/; g-o-v.
Mr. Lawrence: Thank you very much.
This has been The Business of Government Hour, featuring a conversation with Norm Enger, E-government program director in the Office of Personnel Management.
Be sure and visit us on the web at businessofgovernment.org. There, you can learn more about our programs and research into new approaches to improving government effectiveness, and you can also get a transcript of today’s very interesting conversation. Once again, that’s businessofgovernment.org.
This is Paul Lawrence. Thank you for listening.
Wednesday, December 10, 2003
Mr. Lawrence: Good morning, and welcome to The Business of Government Hour. I'm Paul Lawrence, partner in charge of the IBM Center for The Business of Government. We created the Center in 1998 to encourage discussion and research into new approaches to improving government effectiveness. You can find out more by visiting us on the Web at www.businessofgovernment.org.
The Business of Government Hour features a conversation about management with a government executive who is changing the way government does business. Our special guest this morning is Hector Barreto, administrator of the U.S. Small Business Administration.
Good morning, Hector.
Mr. Barreto: Good morning.
Mr. Lawrence: Joining us in our conversation from IBM is Tom Burlin.
Good morning, Tom.
Mr. Burlin: Good morning, gentlemen.
Mr. Lawrence: Hector, perhaps you could begin by talking to us about the Small Business Administration. Could you explain its mission to our listeners?
Mr. Barreto: Sure. I'd be glad to. The U.S. Small Business Administration was created 50 years ago. In 1953, President Eisenhower signed the Small Business Act, and that really created the beginning of what we know today as the SBA. Interestingly, the mission really hasn't changed that much. The mission at the very onset was to aid, counsel, assist and protect all small businesses in the United States, and that's really what the SBA does through all of our programs and services.
Mr. Lawrence: How do you describe the size of the SBA, its budget, its number of people, the people it serves? How do you think about it?
Mr. Barreto: Well, it's approximately $800 million, but we leverage that $800 million in so many ways, with partnerships, with initiatives. Last year, we did pretty close to $17 billion in access to capital. We have a portfolio of loans that we manage, well in excess of $35 billion, and we literally train millions of companies every year, provide billions of dollars worth of contracts for small businesses. So we have really learned over those 50 years how to leverage the resources that we have.
Mr. Lawrence: What are the skills of the folks working at the Small Business Administration? You described so much financially, I began to imagine bankers.
Mr. Barreto: That's one of the great things about the SBA. Because of the folks that work for us and all of the people that are a part of our network, we truly have a cross-section of small business talent and expertise, everything from financial assistance, and that could be microloans, working capital loans, real estate. We even have a Small Business Investment Company Program, which is really our venture capital arm. So very sophisticated applications of that capital.
Entrepreneurial development is really the place that we touch the most small businesses. Last year, we figure that we helped about 2.1 million small businesspersons in the United States, everything from how do you put a business plan together, how do you put a loan package together, how do I do better marketing, how can I use technology in my business, international trade. And then of course, we have a number of contracting programs that help small businesses access that $230 billion federal procurement pie. So it really is a cross-section, a lot of talent and expertise, for the benefit of small businesses.
Mr. Burlin: What about the administrator's position? Could you tell us about the duties and responsibilities that go with that title?
Mr. Barreto: Sure. My responsibility is to make sure that the Agency is reaching more small businesses every year in all of those areas. I am a small business champion. I am an advocate. I like to think that what I do is find the best people for the job and then get out of the way and let them do what they do best. So it is very much an internal and external function. I'm passionate about it. I've been doing it now for a little over 2-1/2 years, and I'm very excited about what's ahead for the SBA.
Mr. Burlin: We know you had experiences before that 2-1/2 years. Could you tell us about that?
Mr. Barreto: Sure. I've been involved with small business all my life. My parents were small business owners, so I like to say that I was born into a small business family. I learned a lot about many types of small businesses. My parents had restaurants, they had a little construction company. They even did a little importing and exporting. So I got a lot of experience at a very early age.
Later on, I went to work for a large corporation in Texas. I worked as an area manager for Miller Brewing Company in Texas for about four years. Then later on, I moved to California and started my own business. I had an employee benefits agency, and then later on, a securities broker/dealer, specializing in retirement plans.
I also got very involved in the community. I was the chairman of the Latin Business Association in Los Angeles, which is one of the largest Hispanic business organizations in the United States, and that's really where I met the President when he was the governor of Texas and got involved with him, and the rest is history, as they say.
Mr. Burlin: That is an interesting background. How did that background prepare you for your current assignment?
Mr. Barreto: One of the things is, I've lived the experience of starting a small business from scratch. I know the trials and tribulations, but I also know the great satisfaction and opportunities that are available by being in business for yourself, and I think that's the reason the President asked me to do this. He wanted somebody that had small business experience leading the SBA. What a novel concept, to have somebody that's actually done it be leading an organization like the one that I have the pleasure and honor to represent. So it's a great opportunity for me because I get to work with my heroes, which are those small business owners all across the United States.
Mr. Lawrence: A lot of people go to work for large businesses, others open their own business. When you think about that choice people make, are there characteristics, or what distinguishes people at that point?
Mr. Barreto: Many, many people would like to be their own boss, but a lot of times, what prevents them from doing that is just really the knowledge, the resources, the tools to be able to do it. I tell people that the first thing they need to do is their homework, because a lot of times, people throw themselves into a new enterprise, they're excited, they're passionate, they've got a great idea, but they haven't thought through all the different stages of the evolution of that business and what types of tools they're going to need to succeed.
But small business people are visionary, they're very entrepreneurial, they're trendsetters. I like to think that they're very courageous and patriotic people who work very, very hard and really have a higher purpose in mind oftentimes when they go into that small business, because they know what they do is going to impact their community, their employees, and, yes, their country.
Mr. Lawrence: Your experiences have been in the private sector, and now for two years now, you're in the public sector. How do you compare the two sectors in terms of management style and approach?
Mr. Barreto: Well, it's very, very interesting. When we came into the SBA, we wanted to take a more entrepreneurial approach. One of the things that we felt was very necessary is to change the perception of what it means to do business with the government. We wanted our customers, which are those small businesses, to really think of us as a partner, not an adversary. We wanted them to think of us as an advocate. We also wanted them to know that we were going to be responsive, because we know that small business people can take a yes and they can take a no, but the maybes kill them. So that's one of the things that we've tried to preach inside of the Agency; we're not a business, but we can think more like a business, and in that way, being much more customer service-oriented, much closer to our customers, and really by that measure really measure our own success by the success of the people that we're serving.
Mr. Lawrence: How about the speed by which decisions are made now? I think a lot of people who have come from business before in this administration as well as previous administrations wake up surprised at the difference in speed. Have you found that to be true?
Mr. Barreto: Well, that's a big challenge, because in business, time is money, and so you want to be able to capitalize on the time that you have and move the agenda as quickly as you can. What you realize is that things are going to take longer. More people are going to be involved in decisions. You're not always going to have all of the resources that you need to fast-forward an initiative or an agenda. So I also tell our folks that it's very important for us to focus in on less things, do less things better. I like to think of the concept of low-hanging fruit, and there is a lot of low-hanging fruit if you can focus in on it and really execute on a good business plan.
Mr. Lawrence: One of the things people are often surprised to discover in the public sector is the scrutiny you get. How have you found that?
Mr. Barreto: There is a lot of scrutiny, but I think the reason for that is that there's a lot of passion around small business. When I first came to town, they told me look, small business isn't a partisan issue. There are just small business solutions. There is not a D solution or an R solution, and I've found that pretty much to be the truth. I think everybody wants the same thing. We might have different ways of getting there. And again, what we want to measure ourselves by is the results, not just the outputs, but the outcomes that come from the things that we are able to offer to small businesses.
Mr. Burlin: What drew you to public service? How did you end up here?
Mr. Barreto: In a way, I've learned about public service from my own parents. My father was the founder of a Chamber of Commerce in Kansas City, Missouri. And then later on, he was one of the founders of the U.S. Hispanic Chamber of Commerce. So I saw my father giving a lot back to the community and to other small business owners. I think he imbued me with that sense of responsibility.
Of course, when the President of the United States asks you to take on a responsibility like this, it's a true honor, and it's something that I wasn't necessarily thinking about. I like to say I was busy minding my own business, literally, when the call came. But I've been so honored to be able to do this work.
Mr. Burlin: As a constituent of the Small Business Administration in your entrepreneurial days, has your perspective changed now that you sit on the other side of the fence?
Mr. Barreto: What has changed is my understanding of what is available to small businesses. I had no idea of the breadth and the scope of the SBA. I felt like I knew a lot about it before I came on board. I had no idea that over those 50 years, the SBA has helped 20 million small businesses in the United States. We have facilitated something in excess of $200 billion. We've helped create some of the best-known names in corporate America that started off as small businesses, and all businesses start of small.
So I just had no perspective as to the kinds of results that the SBA has created on behalf of small business, and that makes me very proud to be attached with an organization like the SBA, and really for that matter very proud of the legacy of the SBA.
Mr. Lawrence: That's an interesting point, especially those numbers you cited.
Why is health care such an important issue for small businesses? We'll ask Hector Barreto of the Small Business Administration for his thoughts when The Business of Government Hour returns.
Mr. Lawrence: Welcome back to The Business of Government Hour. I'm Paul Lawrence, and this morning's conversation is with Hector Barreto, administrator of the U.S. Small Business Administration.
Joining us in our conversation is Tom Burlin.
Mr. Burlin: Welcome back, gentlemen. Hector, let's talk about the President's Small Business Agenda and his vision to create an environment where small businesses flourish. Could you begin by telling us about tax incentives that the SBA is promoting?
Mr. Barreto: Absolutely. This President is very focused on small business, because he understands that small business really isn't small when you consider that there are 23 million small businesses in the United States. They generate 52 percent of the gross output of the economy. And they also generate about three-fourths of the net new jobs and a lot of the innovation that's coming out of the economy. So they're critically important.
The President calls them the engine that fuels the economy, and that's why his Small Business Agenda included this very important jobs and growth package that was passed earlier this year. That really provided millions of small businesses some very necessary and important tax relief, because the President understood that most small businesses are not incorporated; they pay some of the highest tax rates in the country, and when you lower that marginal tax rate from where it was at 38.6 to 35, you return $10 billion into the hands of small businesses. In other words, 80 percent of the benefit of reducing the top marginal tax rate accrues to small businesses.
We didn't stop there. He also quadrupled the business deduction from $25,000 to $100,000. So a lot of the purchases that small businesses were delaying because they were worried about if the economy is going to turn around quick enough, they're making now, and that's something that's helping get the economy going again, and also helping those small businesses create a lot of those new jobs that we need so desperately.
Mr. Lawrence: Expanding and improving health care coverages for small business employees is also a part of the President's agenda. Health care insurance can be very costly for small businesses. How is the SBA thinking about this?
Mr. Barreto: It not only can be, it is very costly for small businesses. I travel all around the country and talk to small businesses every day, and this is high on their radar screen. They tell me oftentimes that they're getting double-digit increases every single year whether they have a claim or not, and they're worried about it. The majority of folks that don't have health coverage or are underinsured either work for a small business or have a spouse that works for a small business.
Sixty-five percent of small businesses that don't have health insurance coverage say that they would gladly buy it if they could get access to affordable health care. So the President has proposed Association Health Plans. That is legislation that's currently working its way through Congress that allows small businesses to pool together, to band together the way that union employees can, the way that large corporations do, and really negotiate the best rates and the best benefits. This is something very important. It won't solve the whole health care crisis, but it goes a long way to providing those small businesses with the kind of coverage and the kind of access that they desperately need.
They need it for themselves and their families, they need it to attract, and they need it to retain, employees. The Department of Labor believes that this could save as much as 25 percent off of the cost of insurance year one. The House of Representatives has passed it and we're waiting for the Senate to take it up, and we hope that they will and that they'll pass this very important legislation soon.
Mr. Burlin: Hector, I'm sure many of your constituents have the perception that Washington is synonymous with red tape. Can you tell us what the SBA is doing to cut red tape, to streamline the processes?
Mr. Barreto: Absolutely, Tom. We're doing a lot. We're using technology more now than we ever have before. We've streamlined the time that it takes for somebody to get a loan with the SBA. We're providing a tremendous amount of information now online so that people don't have to send us a phone book of forms just to get into one of our programs or to get registered, and it's really working. Time is money, especially for small businesses, and for a lot of our partners on the lending side. We work with over 6,000 lending organizations or banks, and we're also increasing the distribution channels, adding more partners to that. So we need to make sure that we can do it quicker, better, faster than we ever have done it before, and so that's really helping. It's one of the reasons that we're seeing the kinds of increases in our loans and our technical assistance and our contracting programs.
Mr. Burlin: You mentioned earlier that every business starts as a small business, and although they're household names today, I think many of our listeners would be surprised to learn that such firms as AOL, Staples and Outback Steak House all received in their formative years help from the SBA. Can you tell us what the SBA is doing to really empower these entrepreneurs of today?
Mr. Barreto: Absolutely. We don't want to rest on our laurels, and we're very proud of the fact that we helped those companies and many, many others, companies like Nike and Intel, Sun Microsystems, Compaq Computer, Ben and Jerry's Ice Cream, Callaway Golf, and many, many others. They all were very small companies that came to the SBA at a time when they needed some help. Either they needed some lending assistance, access to capital, if you will, a loan to buy a building. Some of these businesses received venture capital through the Small Business Investment Company Program. Some of them got technical assistance through our service corps of retired executives or small business development centers.
So we're very proud of that, but we want to make sure that we're helping the next generation of those companies, and as I said, all companies start off small. Coca-Cola and Ford Motor Company started off as small businesses, and they had some trials and tribulations before they were successful.
We also want to make sure that we're helping those companies that are coming from the emerging markets, which is really the fastest growing segment of small business; from women-owned businesses, which now represent 40 percent of all small businesses in the United States. So it's critically important. The three C's is what I call it. Small businesses have always needed capital, capacity, and contracts, and the SBA can deliver and provide all three of those.
Mr. Lawrence: You talk about the assistance. SBA provides small businesses with financial assistance, I think it’s capital under your three C's. But obviously, there are many more small businesses who would like assistance, so let's go through that process. How does the SBA figure out who gets a loan?
Mr. Barreto: We want to talk to any small business who is ready to take their business to the next level. Business is evolutionary. So, for example, a lot of times, people don't realize that we can do very, very small loans, microloans, which could be $10,000. We can do working capital loans, which could be hundreds of thousands of dollars, if not a million dollars, for fixed costs. We can do real estate loans, especially right now when interest rates are so low; a lot of businesses want to buy their building, expand their building, but a new facility. We can loan for heavy equipment and machinery. This is especially important in the manufacturing sector. We can connect them with venture capitalists so that they can expand their business across state lines and go national or international. So there are a variety of different loan programs that are available.
It's very easy. They can either contact us at their local district office, and we have a district office in every state in the union by law; we're in every major city. We work also with about 11,000 retired executives. Those are our SCORE volunteers that can help them. We work with 1,200 small business development centers that are in every county in the country. We have women business centers, business information centers. A very easy way to get information on all of this is just to go online to sba.gov, which gets 1-1/2 million visitors every single week to the website. So there's a lot of information out there. They can call us on the 1-800 number, 1-800 UASK-SBA. The bottom line is if you're a small business or thinking about starting a small business, we'd like to talk to you because we want to be your partner.
Mr. Lawrence: What are the management challenges of making sure that money is used as it's intended?
Mr. Barreto: If you're talking about default rates or improper usage of money, we don't see that a lot. We have a very good underwriting program. Oftentimes when a small business gets to the point where they're going to get an SBA guaranteed loan, they've already gone through a couple of levels of preparation. They've already done their business planning, they've gotten some counseling, they've worked with their lender. So a lot of times, by the time that small businesses are getting to the point where they're going to get that loan, they're already been taken through that paces. That doesn't have to take a long time. But what we know is that when a small business is prepared, when they get this kind of technical assistance on the front end, their chances of success multiply exponentially, especially in those first few years when they're so vulnerable.
Mr. Lawrence: One of the things that I was interested to learn as we were preparing for this was that another service SBA provides is disaster recovery assistance. I wonder if you could tell us about this program and how it was used to help the victims of the California wildfire.
Mr. Barreto: I was just out in California, that's my home state, and we were able to help many homeowners that lost their residences. A lot of people don't realize that the SBA provides loans not only to small businesses in times of disaster, but we also do loans for homeowners or even renters who have lost personal property. And the California fires were a major disaster. We lost close to a million acres of land, something in excess of 4,000 residences. We're not even sure how many small businesses may have been lost or affected by the disaster yet. As of a couple of weeks ago, we had already topped $100 million in loans, and we know that's going to climb a lot.
But we've been there. We were there during Hurricane Isabel. A lot of people don't realize that we also made a tremendous amount of loans after 9/11, not just in New York and around the Pentagon, but to small businesses around the country that were affected through no fault of their own because of something that happened around 9/11. Maybe it was a business in an airport or a travel and tourism company, or a small aviation company, or maybe they were doing business with somebody in the World Trade Center. We did about $1.2 billion and helped save over 10,000 businesses and literally tens of thousands of jobs that would have been lost if we wouldn't have been able to help them.
That's something that the SBA has always done. We really are America's disaster bank, and whether it's a flood, a fire or an earthquake or a terrible disaster like 9/11, the SBA is there to help.
Mr. Lawrence: That's an interesting point, especially about the loans around 9/11.
The management focus of this administration flows from the President's Management Agenda. How is the SBA doing with the issues called out in the PMA? We'll ask Hector Barreto of the SBA to bring us up to date on this when The Business of Government Hour continues.
Mr. Lawrence: Welcome back to The Business of Government Hour. I'm Paul Lawrence, and this morning's conversation is with Hector Barreto, administrator of the U.S. Small Business Administration.
Joining us in our conversation is Tom Burlin.
Hector, can you give us an overview of the SBA's strategic management goals and how these goals were developed?
Mr. Barreto: A lot of our goals are very consistent with the President's Management Agenda. We want to make sure that we're managing our human capital. That's so critically important for any organization. Small businesses deal with it all the time. In other words, what kind of succession planning do you need to do; what does the next generation of leaders inside your organization look like. And that's critically important, especially to an agency like the SBA, where the average age of an SBA employee is 49 years old with 20 years' experience at the Agency. That's a two-edged sword. We're very happy to have so much experience, knowledge, compassion and commitment. But we also know that folks will move on. They'll retire or they may move to another agency. So we constantly have to be concerned with that.
It's also very important, as I mentioned before, that we use technology to reach more small businesses. Government is not getting bigger. We're all asked to do more with less. Technology can be a great leveler of the playing field, a great tool for us. So our e-government initiatives are very important. Eventually, we'd like our clients to be able to access all of our programs online if they choose to, and not have to necessarily get in a car and drive someplace or fill out a bunch of forms.
The financial management of our agency is very important as well. Every resource is critically important, especially in this environment. So we need to validate how we spend those resources and validate the results that we get out of our programs. Our budget needs to be integrated with those kinds of results.
We also need to look and make sure that whatever it is that we're doing at the Agency is the most efficient and effective way possible. I mentioned to you that the SBA really learned to leverage its resources. In the good old days, which I'm not sure if they were the good old days, we did a lot fewer loans because we were doing those directly. We don't do direct loans anymore. We do those through 6,000 partners. In the good old days, if you wanted technical assistance of counseling, you had to go to an SBA office. Now you can go to 1,200 small business development centers, you can get counseling online, you can get all kinds of expertise and knowledge from our retired executives that work for us. So there are lots of opportunities to think outside the box and to get better results for our customers. So everything that we're doing is really aligned with those very key President's management goals.
Mr. Burlin: Hector, you talk about measurements and results, and this administration is strongly supportive of the need to accurately measure and record that performance. Can you tell us what the SBA is doing in the way of measurements and tracking that performance?
Mr. Barreto: Absolutely. It is true that you get what you measure, and we've been measuring everything that we do. That was a commitment that we made at the very beginning. We said look, there is not going to be anything that's off the table. We need to look at everything that we're doing, and we need to hold our people accountable and make sure that they also have the tools that they need to be successful, and that's what we've done.
One of the things that we were able to do is implement an execution scorecard. That's what we call it at the SBA. It was mirrored after some of the scorecards that's taking place, again, on the President's Management Agenda, but we try to take it a step further. There was a great book that we read about a year ago called Execution by Larry Bossidy. It was a wonderful book that that opened our eyes. There were a lot of things that were very applicable to the way that we were doing business.
The net results are that because we have been doing that, we have been able to accomplish a lot of great things. For example, when I first came into the SBA, the average-sized loan was a quarter of a million dollars. We know that most small businesses don't need a quarter of a million or a million. Many businesses are capitalized with as little as $50,000. So we worked with our lenders to get that average loan size down. It doesn't mean that we're not doing large loans. We still have a great program where we do a lot of multimillion-dollar loans, which is really our real estate loan program.
We're reaching more small businesses, as I said, online. Last year, we trained 700,000 small businesses online. So many, many things that have been accomplished through creating some very specific objectives that we measure every day on our scorecard have really yielded great results. Just again to touch on the loans, because that's what we're known for, we broke a record this year. We did more loans this year than we ever have in our 50-year history. We were up 30 percent. But what was exciting to me is we were up in every single category in every single demographic group. So we had a wonderful year and we're looking forward to raise the bar again this next year.
Mr. Burlin: That's interesting, you said you get what you measure. Setting those targets and determining where you need to be has to be challenging. I'm sure there are many demands on your agency. How do you go about setting those targets?
Mr. Barreto: We try to do it in a very collaborative spirit. We work very closely with the folks that are on the ground where the rubber meets the road, which are our district offices and our district directors. We have a goals team that's constantly meeting and making sure that the goals that we have are not only consistent with our strategic plan, but that are also feasible and doable. So there is a lot of exchange. At the end of the day, the goals teams makes recommendations. They need to be ambitious and "stretch goals," and then we approve those and we hold them accountable to them.
Mr. Lawrence: At the beginning of the show, we talked about the overall mission of the SBA, which is increasing the health of small businesses in America. How do you measure the success of that goal?
Mr. Barreto: We get a tremendous amount of feedback from our customers, which are those small businesses, and we like to say that we measure our success by their success, and it's very important. One of the things that we look at, for example, are a lot of the bottom-line indicators. Are these businesses growing? Are they hiring more people? Is their business longevity increasing? Those are all bottom-line indicators. I know that when I was in small business, those are the kinds of things that I looked at. So we're measuring a lot of that as well.
Again, doing a tremendous amount of outreach, asking for a lot of input, and really listening to our customers. I learned a long time ago that you learn everything that you need when you listen to your customers versus talking at them. Your customers are always going to tell you what they need to be successful. So we've done a lot of that. But not just that. We've implemented a lot of those recommendations, and that's one of the reasons that I think that the SBA is more visible than it probably has been in a while.
Mr. Lawrence: In terms of the goals, I think longevity is great and the profitability, but is also growing into a big business one of the things you look at?
Mr. Barreto: Not every business wants to grow into a big business. Every business has different goals. Some folks are pretty satisfied at the level of success that they've attained. They just want to maintain it. They don't want to lose it, or if they can find better ways of doing business. I a lot of times say small businesses don't know what they don't know, and it's not their fault. They're busy, so that's really where the SBA can come in and I think be a very important strategic partner for them.
Mr. Burlin: Hector, we're all limited in some way in our resources, whether it's human capital or it's financial. How do you link those resources and the use of those resources to the results, to the performance that you achieve?
Mr. Barreto: Again, what we want to make sure of is that we're doing more of everything. So it's very easy for us to measure did we do more loans this year, did we do more loans in the fastest-growing communities, are the kinds of services that we're providing to those small business owners what they want. Something that's very important for a small business, they tell me all the time I need the same thing that big business needs. I need more business, so help me get more business. So we've done a lot of things around that as well, trying to create that environment that you referenced.
I think the President says it the best when he says the role of government is not to create wealth. Government doesn't create wealth, Americans create wealth; small businesses create wealth. The role of government is to create an environment where entrepreneurs who are willing to take a risk, an environment where they're willing to risk capital, an environment where they're being heralded and celebrated. So we've spent a lot of time over the last couple of years making sure that the right environment, the right conditions are there for those small businesses to be optimistic about their future, and to also take their business wherever they want to take it.
Mr. Burlin: You come from that community, and you say a lot of your results and your feedback comes from the community. Both as the administrator and having come from that community, do your old friends call you and give you a report on your results?
Mr. Barreto: Every day. Small business people are some of the most passionate people that you're ever going to meet. They're not shy. They're going to tell you, if you're doing well, they're going to tell you what you need to be doing more of, and we try to listen to that as much as we can and again apply a lot of what it is that we have learned.
By and large, I think we're making some good progress. We're not satisfied. We're not again resting on our laurels. We think that the best of the SBA is yet to come. We want the SBA to be strong and very relevant in the lives of these small businesses for at least another 50 years. So I think the kinds of things that we're doing right now are very important to plant the seeds for the future.
Mr. Burlin: You talked about change and the importance of change. The buzzword is transformation, and we know that this is across government. Can you tell us a little bit about transformation in the SBA?
Mr. Barreto: Sure. It's very important. I tell our folks all the time that small businesses are constantly changing. They know that you're either moving forward or you're moving backwards. There is no such thing as staying in place. So as those small businesses have changed over those 50 years, and they have changed a lot and there's a lot more of them, we need to change too. The good news is that SBA has been changing a lot over the last few decades. There are things now that we do that we were never able to do before, and we need to keep doing that.
One of the things that we're looking at is the way that we distribute our programs and our services, especially out in the field. One of the things that we want to make sure that we're doing is that we're freeing up those SBA employees to be out there in those communities to reach out for more small businesses. Not wait for the small businesses to come to them, but for them to go out and find those small businesses, and that's what they're doing.
What they've told me many times is we're as passionate about small business as you are, but a lot of times, our hands are tied. There's a lot of process, there are a lot of responsibilities, there's a lot of bureaucracy that we're responsible for, and if we have to do that, we can't be out there developing these new partnerships and helping these small businesses. So we're looking at ways that we can take a lot of that away from them, and we've found some ways to be able to do that. So that's one of the things that we're very excited about.
There is not a recipe or a cookie-cutter approach to every district office. They're all in different parts of the country and they all have different approaches. But we've been able to be very flexible and work with them and really find some creative strategies on how we're able to reach more of those small businesses.
Mr. Lawrence: That's an interesting point.
The SBA is celebrating it's fiftieth anniversary. What do the next 50 years hold? We'll ask Hector Barreto of the SBA when The Business of Government Hour returns.
Mr. Lawrence: Welcome back to The Business of Government Hour. I'm Paul Lawrence, and this morning's conversation is with Hector Barreto, administrator of the U.S. Small Business Administration.
Joining us in our conversation is Tom Burlin.
Mr. Burlin: Hector, you've talked a couple of times about how technology is enhancing the effectiveness of the Small Business Administration, and computer network security is a critical issue, not just to large business but small business, and probably a challenge across the digital divide to many of your clients. Can you tell us a little bit about how you're educating your constituency in this very important practice area?
Mr. Barreto: We think it's very important. A lot of this education again happens through our technical assistance providers, our small business development centers, our retired executives, but we've also done some new things. For example, we're working closely with Tom Stemberg of Staples. Tom Stemberg was one of those small businesses that came to the SBA for assistance and of course now is a great success story. He is very interested in this issue, and we've been doing some town hall meetings in Staples stores around the country, and also producing a newsletter together to give small businesses some tips on how they can protect their business from cybertheft and from other problems that they may encounter.
There's an old saying in business that no small business plans to fail, but many small businesses fail to plan. So to the extent that they can have contingency plans and really understand where they're exposed, that is going to help them a lot. We saw that after 9/11. The businesses that were prepared, that had a contingency plan, could get back on their feet very quickly. Some that didn't never made it back. So this is a very important issue for a lot of small businesses, and a lot of times they don't realize how exposed they are.
Mr. Burlin: And they're highly dependent on it. As you've talked about having more and more access to the SBA through their electronic means, it becomes even more important. In the Small Business Administration, you talked about your geographic dispersion, the district offices across the United States. You maintain several resource partnerships. Can you describe a little bit about the resource partnership and how you plan to use that to leverage your presence?
Mr. Barreto: Absolutely. We're great believers in public-private partnerships. That's the way that we're able to leverage these resources. I mentioned to you all the things that we're able to do with all these partners by having the banks. This year, we also opened up our loan programs to credit unions. We'd never done that before. Many folks go to the credit unions to get small business loans. They are working, but they also have a business on the side, so that was a great thing. We're training more people, as I said, through the small business development centers, which are independent from us. There are 1,200 of them. We provide the financing and a lot of the best practices. We work with the retired executives. That's another partnership.
We're increasingly working with more and more corporations, because corporations are also very focused on the small business community, and they have partnered with us so that we can reach them together to educate them and inform them and really develop some success stories with these small businesses. So that's very important, and that's going to keep going on in the future, because it's critically important and it just makes a lot of good sense.
Mr. Lawrence: Earlier in our conversation, you talked about the SBA celebrating its fiftieth anniversary this year. What's your vision for the SBA over the next 5 to 10 years?
Mr. Barreto: We want SBA to do more. We want to reach more small businesses. As I said, there are 23 million small businesses. Many of those businesses weren't around 5 years ago or 10 years ago. In the cases where we need to, we want to reintroduce ourselves to small businesses, especially if they think that they already what SBA does, kind of like the way I did. I thought I knew all about SBA and I really didn't. In other cases, we need to reintroduce ourselves, so we'll do much more outreach than we ever have, and we do a lot now, but we'll do even more. We'll reach more people through the Internet. That's just a great way to reach people. As I mentioned to you, we're getting about 1-1/2 million visitors to that website every single week. We'll also make that a very effective tool for them so that they can apply for our programs. I think there will come a day when small businesses will be able to go online to get their loans. They're already going online to register for our major events, to register for our contracting programs, to get forms that they download. So there are a tremendous amount of things that we can do there.
Also, we want to do very impactful events across the country. This year, we've been doing regional events. We've also been doing some major procurement events, where we actually take the buyers out of Washington, D.C., and take them to Main Street. This has enabled us to set up more than 10,000 one-on-one procurement appointments for small businesses. It really takes the needle out of the haystack when you're talking about trying to do business with the government. That's been a very effective initiative. We want to continue those kinds of opportunities for small business.
Mr. Lawrence: Have the trends in the small businesses that are your customers changed over time? Was a small business 10 years ago the same people now?
Mr. Barreto: I just think that they're in more industries. There is not a particular sector where you find all the small businesses. It really cuts across the board. You have high tech companies, you have manufacturers, you have service providers, consultants, retail, you name it. Many more businesses are getting involved in international trade. People don't realize that. Ninety-seven percent of all businesses that do international trade are small businesses. That's over 200,000 companies. That wasn't the case 5 or 10 years ago, and so you're starting to see it.
Also, the growth that you see in different communities. I mentioned that the fastest-growing segment are the emerging markets, which are the minority communities. They represent 15 percent of all small businesses in the United States. Women represent 40 percent. Those weren't the same kinds of percentages when the SBA first started in 1953. So that's exciting. That's breathing a lot of new energy and enthusiasm into the small business sector.
Mr. Burlin: Hector, let me take you to the other side of the spectrum. I'm a little bit envious actually of your day, as least as I imagine it, because I know when I get to work with small business and get to sit in front of folks, you talked about their passion and enthusiasm for their business, are some of the most reinvigorating days that I spend at work. The question is, large companies, how can they engage to be more proactive in this process of engaging small business?
Mr. Barreto: Many of them are already doing it. IBM does a great job of focusing on business solutions for small businesses, and I know that they want to do a lot more. I think that small business is really on the radar screen more now than ever before. In some cases, I think SBA had a hand in putting the spotlight on the importance of small business, and many more people have gotten involved. Obviously, the SBA would love to be a partner with any organization that wanted to reach out to small businesses, and we hope that they'll give us a call. But there are so many opportunities to do this. There are so many organizations that represent small businesses, and so there is really no excuse for those that are really committed to helping small businesses not to be involved, especially now.
Mr. Lawrence: Hector, you've had an interesting career, primarily in the private sector, but now coming to the public sector. So I'm curious, what advice would you give to somebody interested in joining the public sector?
Mr. Barreto: The first advice is it's not about you. That's the first advice. When you come here, you really need to be coming from the place of wanting to serve, to wanting to make a contribution. I think it's also important to be passionate about your work. I would say that in any activity that you're involved with with regards to your career. But when you're doing it not so much as a job but as a higher purpose, you can get so much fulfillment out of it and your days can fly by, and it's a lot of fun. It's fun to work with the level of people that we get to meet and work with every single day. It's an exciting, exciting opportunity, and it is very fulfilling.
Mr. Lawrence: Hector, I'm afraid we're out of time. Tom and I want to thank you for squeezing us into your very busy schedule.
Mr. Barreto: Thank you very much. I hope that all that listening that are interested in the SBA will reach out to us at sba.gov, or you can also call us at 1-800 UASK-SBA. Paul and Tom, thank you very much for this opportunity.
Mr. Lawrence: Thank you.
Mr. Burlin: Thank you.
Mr. Lawrence: This has been The Business of Government Hour, featuring a conversation with Hector Barreto, administrator of the U.S. Small Business Administration.
Be sure and visit us on the Web at www.businessofgovernment.org. There, you can learn more about our programs and research into new approaches to improving government effectiveness. You can also get a transcript of today's very interesting conversation. Again that's www.businessofgovernment.org.
This is Paul Lawrence. Thank you for listening.
Friday, September 26, 2003
Mr. Lawrence: Good morning and welcome to The Business of Government Hour. I am Paul Lawrence, partner in charge of the IBM Center for the Business of Government. We created the Center in 1998 to encourage discussion and research into new approaches to improving government effectiveness. You can find out more about the Center by visiting us on the web at www.businessofgovernment.org.
The Business of Government Hour features a conversation about management with a government executive who is changing the way government does business. Our special guest this morning is Patrick Ciagner, Program Executive Officer of NASA's Integrative Financial Management Program.
The Business of Government Hour features a conversation about management with a government executive who is changing the way government does business. Our special guest this morning is Patrick Ciagner, Program Executive Officer of NASA's Integrative Financial Management Program.
Good morning, Patrick.
Mr. Ciganer: Good Morning Paul.
Mr. Lawrence: Joining us in our conversation is Steve Sieke.
Good morning, Steve.
Good morning, Steve.
Mr. Sieke: Good morning, Paul.
Mr. Lawrence: Well Patrick, let's begin by understanding the mission of NASA's Integrative Financial Management Program, or IFMP.
Mr. Lawrence: Well Patrick, let's begin by understanding the mission of NASA's Integrative Financial Management Program, or IFMP.
Mr. Ciganer: Well as the name indicates, the primary mission is to develop the financial management capability that is Agency-wide, and also integrates a lot of the factors that allow you to manage more effectively. Over time, the Agency discovered that in the case of its undertakings, which are mostly projects and programs, there is more than just cost or budget data. There is human capital; there is resources; there is assets. And the ability to have access to all of that information in a fairly seamless way is what the Agency is looking for. So, although all the word "financial" is in the middle of it, the integration component is really the goal of this specific program.
Mr. Lawrence: And what is the vision of the program?
Mr. Ciganer: The vision is to provide to management and the bulk of the Agency employees the ability to access, account, track and manage information as effectively as possible. And the information is fairly broad, so therefore, we are not just focused on one specific area of the Agency. But we are looking at the institutional side, which is the administrative side and the programmatic side. So it really is to provide an overlapping umbrella and capability to all of the employees within the Agency.
Mr. Lawrence: How do you describe the size of this undertaking? Budget, people, time?
Mr. Ciganer: The current undertaking is approximately a six-year effort. The budget is $497 million. The number of people involved average approximately 300 to 400. They vary, because we broke down the program into several projects, and some projects will have slightly larger staffing requirements. But that essentially is the scope and the timeline of the project.
Mr. Lawrence: So by normal standards this would be a large project, but by NASA standards, this is a small project?
Mr. Ciganer: It's a medium-sized project. It's the cost of one shuttle launch. But from a timeline, it's a little bit shorter than some of the probes that we will build and launch. But it fits within the NASA operating parameters. People feel comfortable looking at the size of the dollars, the staffing requirements and the fact that we are touching every single center. So we are not raising eyebrows either by being too small or too large. We are within scope.
Mr. Sieke: Patrick, let me ask you a couple of questions about the genesis of IFMP. Could you start out and just give us kind of the history behind the inception of the project. And maybe you could start with what financial management looked like before IFMP, and explain why NASA decided to embark on this major undertaking.
Mr. Sieke: Patrick, let me ask you a couple of questions about the genesis of IFMP. Could you start out and just give us kind of the history behind the inception of the project. And maybe you could start with what financial management looked like before IFMP, and explain why NASA decided to embark on this major undertaking.
Mr. Ciganer: NASA has been essentially aiming at developing this fundamental capability for the past decade. This is actually the third effort aiming to develop this functionality. It started in the early '90s, where the Agency took a path that looked at developing all of that software and doing all of the integration in-house, essentially soup-to-nuts-in-house development. Unfortunately, we are a scientific and engineering agency, and for several reasons, the performance that was delivered out of the early results wasn't worth the cost. So this was essentially terminated.
In the mid-'90s, the effort was started again going to an outside organization. But the thrust was again trying to develop all of the functionality using custom code as opposed to using existing functionality that you find in packages, and trying to deliver all of the capabilities serving all of the constituencies at once. In plain English, that means that we were going to have an accounting system for the accountants; budgeting system for the budgeters; an HR system for the personnel people; a project management system for the programmatic folks, all at once. Again, this did not deliver as promised. A couple of applications were developed, but due to the complexity of the Agency's structure and the wide variety of projects and programs that we're involved in, we realized by 1999 that there was way too much code that needed to be cut in order to meet all of those requirements.
So the third incarnation of this effort, which is the current IFMP, was started in late 2000. And in this case, we decided to go "COTS" -- the commercial off-the-shelf systems. Now that is a little bit of a misnomer. We are using a COTS underpinning, which is the SAP relational database environment and their core financial application, and we are using specific applications that are off-the-shelf. But the integration effort is completely discrete to the Agency. And in some of our future modules -- we don't call them applications, we call them modules -- there is also quite a bit of development. We are using tools that are off the shelf. For example, the way NASA formulates its budget is extremely specific to the Agency, and there was nothing off-the-shelf that met those requirements. So we are actually developing using COTS tools our budget formulation capability.
So the third try is, I would say, above all, a mix between off-the-shelf functionality and some custom development. But it's learning from the previous experiences two very critical lessons: One is do not try to do everything at once. And the second is to look at your business processes. Look at the functionality of the system that you are implementing and/or purchasing and try to actually make the processes fit the functionality of the software, as opposed to the other way around.
One of the many lessons-learned sessions we have had over the past couple of years with organizations, mostly in the private sector that have implemented this type of software, was focused pretty much on what went wrong. I mean, the way we decided to lead those discussions was: success is very difficult to define, but failure is a lot easier to bind. We need to understand why you failed. When we spoke to the users of SAP, which is the core software we are using, met two very large-sized organizations comparable a little bit to us, and they came and essentially out of quite a few presentations, did define three or four major drivers on why things did not go as planned. The first one was they tried to modify the software, especially when technology companies were purchasing COTS. They know they can cut code; let me go in there.
The second is you have to make sure that the system adoption goes beyond just technical success, which means -- this is such a complex environment, having the software essentially operate correctly is only part of the story. Unless there is a fundamental effort aimed at changing the way an agency operates or an organization operates and uses the software the way it is supposed to be used, you are not going to get there. And in many cases, the system dies on the vine and you go back to the way you used to do business.
And then the third element is you've got to take essentially very measured steps. And you cannot assume that previous successes are going to decrease the amount of risk that you have moving forward.
Mr. Sieke: Patrick, you had mentioned that IFMP is a kind of a medium-sized project. But it certainly is significant from the standpoint that it impacts everything at the Agency. I'm just wondering if you could share with us your roles and responsibilities specifically around the IFMP project.
Mr. Ciganer: One of the most critical elements to ensure the success of this type of project, given the fact that it indeed touches pretty much everybody that works there, is a very solid endorsement from the senior leadership. When the program got off the ground, there was a realization very early on that the changes in some cases were so significant that unless there was the perception that senior leadership was very clearly not only supporting, but also monitoring the progress, there was a possibility for some of those changes not to take place. As a consequence, the program was established in such a way that I report directly to the administrator, which means I am responsible ultimately for the implementation and the successful operation of this series of systems.
I've got a team, which is composed of program management and project management. But essentially, I am the point person on making sure that not only there is proper visibility on the program performance and progress at the senior level of the organization, but also a proper line of communication that is clearly established between the various constituencies and the senior leadership. As I mentioned earlier, we are implementing a lot of changes. And in some cases, the way we are developing some business steps is potentially not as efficient as it was in the past. As a whole, it is a lot more efficient, but specific groups, organizations, constituencies are affected in different ways, and there are cases where things are actually turning out to create more workload, rather than less. They are far and few in between, but they are still there. And we needed to develop a way for the people that were the most affected to have a link all the way up to the top of the organization.
Mr. Lawrence: That's a good point. What are the pieces of the financial management program and how is it scheduled? We'll ask Patrick Ciganer of NASA to explain this when The Business of Government Hour returns.
Mr. Lawrence: That's a good point. What are the pieces of the financial management program and how is it scheduled? We'll ask Patrick Ciganer of NASA to explain this when The Business of Government Hour returns.(Intermission)
Mr. Lawrence: Welcome back to The Business of Government Hour. I'm Paul Lawrence, and this morning's conversation is with Patrick Ciganer. Patrick is the program executive officer for NASA's Integrated Financial Management Program. And joining us in our conversation is Steve Sieke.
Mr. Lawrence: Welcome back to The Business of Government Hour. I'm Paul Lawrence, and this morning's conversation is with Patrick Ciganer. Patrick is the program executive officer for NASA's Integrated Financial Management Program.
And joining us in our conversation is Steve Sieke.
Patrick, how has your previous experience helped you in this current position?
Mr. Ciganer: Well, Paul, in a couple of ways. One of the main, I guess drivers of the Integrated Financial Management Program is obviously the ability to tie performance and financial characteristics of specific programs and projects. I come from private industry, joined NASA a couple of years ago -- 18 months ago specifically -- and previously, I was both on the technical and systems side, and more recently I was CFO of a company on the West Coast.
So I think part of the reason that attracted me to NASA and maybe interested NASA was the fact that I was able to look at this type of implementation from both a system and a project standpoint, and also as an end user. As CFOs, many organizations look at you as both the entity responsible for delivering credible numbers, but also the organization responsible for putting in place a system to generate those numbers. One of the concerns that the Agency had, based on their previous experience, was to try to be as transparent as possible in the development of the system and get the various constituencies involved, as opposed to this is a system that we are going to build and throw at you; this is a system that we are trying to build with you, and we will roll it out with your participation.
So in my case, I started my career more on the operational and systems side, mostly working for large Fortune 50 companies in the system component of financial departments, and then over time I migrated towards more of the, shall we say, the end user of the product as a CFO. In the case of NASA specifically, about 2 years ago, I was asked to look at the space station cost overruns that had been taking place. A commission had been established, chaired by John Young, and I was responsible for developing the financial management recommendations moving forward that would potentially help mitigate some of the overruns. So that was my first exposure to the Agency's inner financial works, and as a consequence potentially of some of those recommendations, I had this interesting event take place where I was asked to help implement those recommendations. And that's how I ended up at the Agency.
Mr. Lawrence: That's terrific. Can you describe, Patrick, the main components of IFMP for our listeners?
Mr. Ciganer: Gladly, yes. I mentioned earlier we have multiple projects as opposed to trying to implement all of the capabilities at once. We call them modules. We have developed and implemented roughly half of the modules that will ultimately comprise the system, the suite of applications. We started with position description and r�sum� management, partially because staffing was and continues to be a very critical element of the success of the Agency. Above all, again, we are a scientific and engineering organization, and for us, we are only as good as the people that compose our organization. So this is not so much processing specific things, this is leveraging on individual talents. So although this is an Integrated Financial Management Program, the immediate requirements were very much to support some of the staffing efforts.
So we developed and implemented the first two modules about 18 months ago, called r�sum� management and position description. This was followed by a module called Travel Manager. Again, the nature of our organization is such that we have a lot of people spending a lot of time in airplanes, going not only all around the United States, but going internationally, mostly to Russia, but also to Europe, to Australia and so forth. And a significant amount of money is spent traveling. So we needed from a financial control standpoint to develop the capability of tracking and managing more efficiently travel costs.
Now just as a quick background, though I'd like to believe most people know who we are, the Agency is actually a very decentralized organization. The Agency operates out of 10 centers that are spread across the United States. And those centers have very specific missions. They are in charge of specific programs, projects, in the sense that a lot of the work gets done there. The program management of the Agency is center-independent. Program managers in many cases will manage undertakings that are housed at several centers. If you are in space shuttle activities, you will have work being done at Stennis, at Marshall, at Johnson, eventually at Kennedy. So you need to be able to coordinate and have insight in a variety of centers.
In space science, you have work that goes on at JPL, at Goddard. So as a consequence, our organization is both distributed and also coordinated in slightly different organizational lines; the equivalent in private industry of divisions. Divisions can have multiple plants or production areas but the divisions themselves are in a certain area. In addition to that, headquarters, here in Washington, is responsible for, obviously, not only the budget but the overall policy and management of the entire organization. And their requirement for integrated data is also quite high. So this is actually comparable to a traditional distributed multinational organization. And I should mention that we also have satellite offices all over the world. So the need for something like a travel manager application is actually fairly significant if you start looking at the coordination efforts required.
After Travel Manager, the next application that just got deployed was our core financials application. That is a very traditional product. This is what you would call budget execution from a government standpoint. This is your financial accounting module from a private standpoint. This is basically the books of the Agency.
Now this was a major undertaking, because up until now, every one of the centers that I mentioned had their own accounting system. That system was autonomous, had been usually developed or contracted or purchased locally, and really was not capable of any integration with any other accounting system from any other center. There were interfaces; data could be exchanged, but there was very little capability, for example, in the traditional consolidation accounting, where, let's say a specific enterprise rolls out their information on a specific program, you look at the information at the top and you want the ability to drill back down to a specific task. That did not exist. I mean, there was a lot of data calls where the constituency needed information from another constituency and asked for the information.
But first of all, they have to ask. And second of all, it had to be extremely well-defined, because it's the old 'what you see is what you get;' in this case, what you ask for is what you get. And the analytical capabilities were very limited. So the core financial system did two things: it retired 10 family of accounting systems. It was more than just one system per center. It also put every single organization in the Agency on a single instance of the software. Which means everybody essentially operates -- puts data in, gets data out, generates reports -- out of the same environment. That is a massive relational database, and that is for us a significant step, because the ability from any angle in three dimensions to get the information out is something that the Agency has been after for a long time and is finally able to gather.
So that is the most recent module that we implemented. To date, it has been the most complex. Because literally, it was 10 separate implementations. A good friend of mine who now left NASA warned me when I first came into the Agency and said, "You know, when you've seen one NASA center, you've seen one NASA center." So the experience that we learned out of deploying in one center had some correlation to the next deployment, but it was fairly modest. What we did is we actually broke down that roll-out into three separate waves, partially because we just did not have the resources to try to get everybody up at the same time. There is a very large training component, and we just could not muster getting everybody trained at once.
Besides that, we wanted to actually up to a point create out of the first wave a semi-pilot, learn from that, and then get the second wave to address for some of the major centers the more complex conversion issues. And then the third wave would hopefully be able to close the door fairly shortly. So the core financial module which just finished implementation of its third wave on June 23 is that the future modules are as follows: there is a budget formulation module, which is the formulation of the budget as opposed to the execution of the budget. That is being developed as we speak and is slotted for complete roll-out. In this case, it is going to be a single roll-out in a single instance Agency-wide some time next spring.
After that, we have an asset management module, which for us is also a fairly critical component. Our auditors get very nervous when we are not able to track where some of our probes are. But we tell them that is sometimes fairly difficult to verify whether or not this sensor is on that probe when it is on its way to Mars. But we should be able to at least tell them roughly where it is. So the asset management module in itself is going to be a fairly large undertaking, and then following that, we are going to have an HR module, which is really a human capital management capability. It goes beyond just personnel records and employee payroll and so forth. And then finally, we are going to take the contract administration capability and move it to hopefully some of the next technological steps that are coming down the road, which is an advanced document generation system. We're discussing potentially the use of a semantic web for more efficient information retrieval. So those are the major modules.
Mr. Lawrence: All of the work just described has huge management challenges. What are those challenges and how have they been addressed? We'll ask Patrick Ciganer of NASA to take us through these challenges when The Business of Government Hour returns.
Mr. Lawrence: Welcome back to The Business of Government Hour. I am Paul Lawrence, and this morning's conversation is with Patrick Ciganer. Patrick is the program executive officer of NASA's Integrated Financial Management Program. Joining us in our conversation is Steve Sieke.
Mr. Lawrence: Welcome back to The Business of Government Hour. I am Paul Lawrence, and this morning's conversation is with Patrick Ciganer. Patrick is the program executive officer of NASA's Integrated Financial Management Program.
Joining us in our conversation is Steve Sieke.
Mr. Sieke: Thanks, Paul. Patrick, the implementation of the IFMP program has meant a lot of changes for NASA and its employees. Can you explain to our listeners how you are managing that change?
Mr. Ciganer: We discovered very early on that the adoption of the program is not something that was automatically performed. Traditionally, especially when you have a series of processes that are perfectly capable of satisfying your requirements, there is a reluctance to try to learn how to use a new system. I mean, something as fundamental as when we get a new system on our laptop, a new operating system, we are reluctant to see the benefits. It takes us a while to get used to it.
This was magnified, first of all, 10 times, because we have 10 separate centers, and therefore, 10 separate systems that could not even be taught to take the next step on a one-size-fit-hole approach. The second thing is, this type of implementation is only as successful as the adoption of its ultimate users. We can have a theoretical, technical success. And as I mentioned earlier, unless the system potential gets really exploited by the various constituencies, we are just not achieving the ultimate goals. We discovered that change management, which is a very generic term, is something that requires a lot of attention. It's not an afterthought; it is not the purview of the softer sciences. It is not something that automatically will come to people that are in charge of training the various new users. It is actually an activity that requires not only focus, but organization, tracking a specific set of metrics, quantifying to the extent possible how some of the changes you are trying to implement are catching on.
I think that is actually the most difficult part of this undertaking, especially given the scope of the IFM program where, as you mentioned earlier, we are touching not only the financial community, but also the programmatic community, the HR community, the average individual that works at the Agency as a whole. There isn't a facet of our program that doesn't touch every single individual. So what we've decided to do is two things: first of all, we have hired who we considered were the best outside organizations capable of leading us through those steps. And our selection process there was based on their previous experience in comparable environments, and also, their ability to understand how our agency operates.
We wanted to be very careful again, because I like to believe we are special, like every other organization. But it is not because this system works in organization X that you can take the exactly the same approaches and apply them to organization Y hoping to get exactly the same results. In addition to that, self-introspection in this type of activity is very difficult. I don't presume to be able to autonomously gauge how well we are doing in implementing change. So that is why we went and we continue to use an outside set of eyes that can gauge on our behalf how well we are doing and then additional outside resources that can lead us down that path.
Now how do we really measure that change? There is empirical methods, such as the good news is we can see how often people use the various modules of the system compared to -- when people get trained to get an ID and a password in the new system, and then we can develop some generic statistics on how many users got trained, how many users are using the system on a period of time after the training. How many trouble tickets or error messages are generated? How many system questions get logged? What we did was obviously maximize the capabilities of the system to gather that information, and also set up a competency center, which is the equivalent of an ultra-sophisticated help desk. Imagine a help desk that not only can answer questions on how do I log on, but also can get into the system and take care of specific processing issues or look at relationships, look at the way the data is manipulated, the way it is stored, the way you report it.
So one of the ways we measure change is also getting feedback from that center on the level of complexity of the questions being answered. Also, as time evolves, you will have users go up the learning curve and bump into more and more complex issues. So that's in a fairly balanced way the method that we use to figure out how change is taking place. I mean, we do have customer surveys and a series of workshops, but those are not, I would say, as hard-hitting for us as how often do we have problems cropping up when the various modules are being used.
Mr. Lawrence: Patrick, one of the key components of change management, as you know, is communication. And I was just curious how you are ensuring that effective communication of all the program efforts and changes is getting out the community?
Mr. Ciganer: One of the main drivers of the program is to make sure that we are as inclusive as possible. Unfortunately, we have to be located someplace. We happen to be at headquarters in Washington. But what we've done is in every single center; there is actually a local change management team. So the various centers dial only four digits on their phone to talk to somebody, as opposed to you know, calling those characters in Washington. So that's a big step in really developing a mechanism for effective communication.
The second component is one which is more of a generic approach, which is, we Literally, whether it is the administrator or myself or any of the enterprise leaders, will personally answer any phone call, e-mail that gets sent to us regarding questions about the overall system. In most cases, the questions fall into two categories. There are the technical questions that the competency center will handle. We wanted to make sure our folks understood there was an open-door policy if you had larger concerns, strategic concerns on the potential functionality of the entire suite of applications, on the impact of changing some of the processes. So the more generic, I would say global, questions are encouraged and literally percolate all the way to the top.
So that is also one of the communication lines we set up very early. The good news so far is that we are not overwhelmed by calls and e-mails, but we'd like to believe that throughout the organization, people understand that vertical communication is completely open. In addition to that, we have created a category of superusers, should we say, of the new modules, which means in every single group, department, organization, there are folks that volunteered to us the capability of sharing their knowledge and experience with their peers.
So in many cases -- you know, and we're all like that -- it's easier to walk to the office next door, the cube next door and ask a question, rather than pick up the phone and try to call a help desk. And we've really tried to build up this informal superuser infrastructure along with business process leads in each one of the organizations. They're for the folks that are not so much technical, but that are there to try to explain the logic behind some of the steps and the changes that take place. And dealing with, again, technical constituencies, you cannot just say do it because we tell you so. They we will ask why.
Mr. Lawrence: What are some of the other complexities of the program and how are you dealing with those?
Mr. Lawrence: What are some of the other complexities of the program and how are you dealing with those?
Mr. Ciganer: One of the interesting aspects of this program is the fact that we have a lot of data that gets generated now which is accessible to a very broad spectrum of users. Before, it was much more stovepiped. One of the interesting by-products is how do you turn that data into information? And specifically, in something as simple as reporting specific information related to a program or project, an initiative, an undertaking, there is so much data that is now available at an incredible level of detail, that teaching people to look at exactly the same information when they want to discuss it is actually an interesting challenge, because all of a sudden people get inquisitive and they want to explore, "Well, what if I present the information, adding this and subtracting that, then putting a time component and doing this type of analysis so I can go and discuss it with my peers?" Well, it turns out that they did not exactly attract the information the same way, so they are not discussing exactly the same data.
So one of the complexities is, we have now a very powerful tool kit. And teaching folks to make sure they use the same tools when they are trying to obtain the same results is one of the components. It is an interesting by-product of enhanced capability. The other one is a little bit different. It has to do more with an evolution of our organizational structure. Information now can be shared and is readily available throughout a whole range of different activities. The ability to extract that information, or to even develop specific models, specific scenarios using the historical data to move forward, is a lot more present than in the past. So one of the things we are trying to incite is the ability to spend a little bit of time on getting deeper into what the information is and then developing maybe more what-if alternatives.
Mr. Lawrence: How does an Integrated Financial Management Program help NASA meet the goals laid out in the President's Management Agenda? We'll ask Patrick Ciganer of NASA to give us his perspective when The Business of Government Hour returns.
Mr. Lawrence: Welcome back to The Business of Government Hour. I am Paul Lawrence, and this morning's conversation is with Patrick Ciganer, program executive officer for NASA's Integrated Financial Management Program. And joining us in our conversation is Steve Sieke.
Mr. Lawrence: Welcome back to The Business of Government Hour. I am Paul Lawrence, and this morning's conversation is with Patrick Ciganer, program executive officer for NASA's Integrated Financial Management Program.
And joining us in our conversation is Steve Sieke.
Mr. Sieke: Patrick, how is IFMP helping NASA implement the President's Management Agenda?
Mr. Ciganer: The President's Management Agenda, the PMA, has essentially 5 components: Human capital, financial management, procurement, budget performance integration and e-Gov. I think that I have described over the past few minutes a series of modules which, fortunately or unfortunately, touch every single one of those components. Obviously, the financial management part of that is at the core of what we are doing with the IFM program. But the human capital is right there. The budget and performance integration is the cornerstone of how do you use the financial information to be more effective in managing various programs and projects.
Procurement again is separated from a PMA standpoint, but obviously is very heavily relying not only on the budget execution, but also some of the performance data. So we believe that the IFM in its totality basically will support and enhance the capability of implementing a lot of the guidance and encouragement that the PMA gives the various mentor organizations.
Mr. Sieke: How do you measure the success of the IFMP program?
Mr. Ciganer: The adoption of the functionality of the program above all is our yardstick. I mean, there is a technical success, which is something as fundamental as the ability to close our books every month and produce quarterly financial statements and produce clear, timely robust information. I mean, that is the mechanical part of the system that shouldn't be overlooked. That's easy to measure. It's binary; it either works or it doesn't. What is more complex is to hopefully see an improvement in how efficiently decisions are made and how much information is available to make those decisions on a timely basis. I mean, one of the critical elements in a lot of the work that we do in research and engineering is in some cases having very, very short timelines to make key decisions that have very long-term impact. We would like to believe that this program will allow the decisionmakers at all levels to make more educated decisions that will result in a more efficient use of what are limited resources.
Mr. Lawrence: What do you see as some of the greatest challenges facing the project before it gets completed?
Mr. Ciganer: I think there are some technical challenges over the horizon. For example, our budget formulation model, as of yesterday's latest estimate, will be manipulating approximately 140 million lines of information. This is a real-time or near real-time system. So there are some very hardcore system performance issues that we are facing in the near term. In the longer term, I would say the asset management systems that we envision coupled with the project management capability we want to give our constituencies, are looming fairly large over the horizon.
Our agency is involved in a very broad spectrum of activities, from fundamental research to near-operational activities. And they are very different. They are all categorized as programs and projects. But there is no-one-size-fits-all tool that we can offer. So the ability to build, deploy and offer systems that can support those activities in parallel is daunting. As far as I know, it has not been required by any organization so far. So we are once again in a pathfinder position. If we were only in the space science business or only in the earth science business or only in the human space flight business, we would narrow the scope of the functionality we have to offer. And unfortunately, we are doing all of it. So those are going to be interesting challenges in the next 24 to 36 months.
Mr. Lawrence: I want to ask you to put your little bit grayer future thinking cap on, and 10 years from now, when people think back and 10 years when people think about financial management or even information management at NASA, what do you want that picture to be, or that vision?
Mr. Ciganer: It's interesting. Driving up, I was actually thinking about information management and information science, partially because it is something that permeates pretty much every facet of what we do. And taking a step back from just the IFM, what this organization is above all into the business of doing is turning information into knowledge. We are in the business of gathering information, whether it is planetary information, cosmology -- I mean, it is information. We are trying to in some case validate specific theories. In some cases, we are trying to empirically prove some of the designs that we are coming up with.
But above all, what one of our objectives is is to generate and make information as available as possible to as broad a constituency as possible. As part of that, we actually have a lot of very interesting initiatives going on in supercomputing, in nanotechnology, in intelligent networks, in smart machines -- man/machine integration. Ten years from now, I'd like to think that some of the more mundane undertakings -- and I'm not saying they're not important -- but some of the more mundane undertakings we are involved in right now with the IFM program will also benefit from some of the leading-edge information science research we are doing.
As I mentioned, in one case, we are asked right now to manipulate a massive amount of information in real-time. Although it is for budgeting, not for processing cosmic microwave background information, it is nevertheless fairly daunting. And I'd like to believe that we are back on the path where possibly we, in a decade, will be leaders on manipulating the visual display of information in something that everybody is after. And maybe in a few years from now, this system will help bring into the fold those two communities that have been running on parallel paths but not crossing that much.
Mr. Lawrence: You've had an interesting career, albeit a short one in serving the public and government. I am curious, what advice would you give to someone considering public service?
Mr. Ciganer: First of all, I would say do it. One of the things that is incredibly rewarding in working in the public service is first of all the nomenclature. It is public service. But also, you are faced with, usually, issues that are of a magnitude that is not seldom encountered in the private sector that quickly. And when we are talking about young people, when I see some of the young folks that we bring in-house and they get exposed to issues, to undertakings, to initiatives that are truly beyond the traditional corporate world, unless you happen to work for an extremely large organization.
So one of the benefits of public service is literally the ability to be exposed and to learn how to operate and eventually manage in very complex situations. There's a lot of constraints. Now, you know we are a public organization, which means we don't have to show our bottom line. On the other hand, we have to maximize the effective use of the dollars that are entrusted. The stewardship of those funds is something that goes beyond buying the most cost-effective widget. It is what is the most effective way of making those choices. And there are tradeoffs. It is not an unlimited source. And bringing young folks into an environment where those tradeoffs are consistently discussed I think prepares them not only for -- should they desire so -- a continuous public service career, but when they reintegrate to the private sector, or integrate to the private sector, they will have been exposed to a series of situations that very seldom younger or more junior folks in the private environment get exposed to.
Mr. Lawrence: Well, Patrick, I'm afraid we're out of time this morning. Steve I want to thank you for joining us.
Mr. Ciganer: Steve and Paul, thank you for having me, and should anybody be interested on following up how the IFM program is doing and what our progress is to date, we've got a link, which is www.hq.nasa.gov, so thank you again.
Mr. Lawrence: This has been The Business of Government Hour, featuring a conversation with Patrick Ciganer, program executive officer of NASA's Integrated Financial Management Program.
Mr. Lawrence: This has been The Business of Government Hour, featuring a conversation with Patrick Ciganer, program executive officer of NASA's Integrated Financial Management Program.
Be sure and visit us on the web at www.businessofgovernment.org. There, you can learn more about our programs and get a transcript of these very interesting conversations. Once again, that's www.businessofgovernment.org.
This is Paul Lawrence. Thank you for listening.
Friday, October 31, 2003
Mr. Lawrence: Good morning and welcome to The Business of Government Hour. I'm Paul Lawrence, partner in charge of The IBM Center for The Business of Government. We created the center in 1998 to encourage discussion and research into new approaches to improving government effectiveness. You can find out more about the center by visiting us on the web at www.businessofgovernment.org.
The Business of Government Hour features a conversation about management with a government executive who is changing the way government does business. Our special guest this morning is Ken Blackwell, Ohio secretary of state. Good morning, Ken.
Mr. Blackwell: Good morning.
Mr. Lawrence: And joining us in our conversation is Glen Graham. Good morning, Glen.
Mr. Graham: Good morning.
Mr. Lawrence: Well, Ken, you’re almost a year into your second term as the secretary of state of Ohio. Can you describe your roles and responsibilities for us?
Mr. Blackwell: The secretary of state is the chief election officer of the state, and he or she is also the primary keeper of business records and the protector of intellectual property in the state of Ohio. So we -- the secretary of state protects corporate identities, makes sure that corporate histories and records are properly maintained, and is generally the person that is responsible on the -- in a broader sense, for encouraging civic engagement in our state community.
Mr. Lawrence: How big is your team? Could you describe what it takes to get all those done?
Mr. Blackwell: We have a team of about 160 employees and the majority of those employees are assigned to our business services sector. And so it’s where I spend most of my time concentrating on the reinvention of how we did business in that area.
Mr. Graham: And since you became Ohio secretary of state one of your projects was starting the Ohio Center for Civic Character. Can you share with us the mission of the project and describe for us the history behind the inception of the project?
Mr. Blackwell: Well, the history is -- it sort of transcends my tenure as secretary of state. I started to conceptualize this notion of using character development in a way that not only enhanced the everyday life of a citizen in his or her community, but how we could apply the a character development strategy as a way of transforming the culture of the workplace where we could improve the way people communicated and related to one another as a way of building a team and building a common language of respect. And so we hit the ground running when I became secretary of state in January of 1999. And we pulled together the entire workforce and said we want to really begin to build a true community and it started with a common language. We said we want to take some words that are frequently used, like “fidelity” and “honesty” and “trustworthiness,” and to make sure that we all had a shared sense of what these concepts and these principles were in our everyday life.
And so we developed what was called uncommon sense and it’s 20 character-building principles that sort of evolved from the workplace and out of genuine dialogue with one another so that we began by creating that language. And we started out with the assumption that character was the cornerstone of citizenship. A free people, a self-governing people had to have internal compasses by which to govern themselves if they didn’t want big government on the outside external to their family, their community governing their lives. And so we went back to some basic understandings.
You know, James Madison, the chief architect of the U.S. Constitution, was fond of saying that American civilization didn’t turn on the power and reach of political institutions. Instead, he thought that the future of American civilization rests, and these are his words, on the capacity of each and every one of us to live in accordance with the Ten Commandments of God, you know. So as far as Jefferson was concerned, the ground rules, the protocol of good living took place when Moses received the Decalogue at Mount Sinai. And so we started to build from this concept that the character was, you know, essential not only to a self-governing people, but to a free people and that applied to the workforce, you know. You had genuine relationships and you had genuine belief in the workers that they were the driving force behind an enterprise, an organization, or a workplace, that you probably were going to get better performance from that community of workers.
Mr. Lawrence: You’re the 51st Ohio secretary of state, as I understand it, and you have a long history of public service. Could you tell us more about the previous positions you held in Ohio before your current one?
Mr. Blackwell: Well, I grew up in Cincinnati, and I grew up in a public housing community. When my father came back from World War II there were still vestiges of segregation. There was a housing shortage and so we first lived in some old Army barracks and then we moved into the Laurel Homes, which was a public housing community.
Coming up through the Cincinnati public schools I went to Xavier University on a football scholarship, graduated from Xavier, and got involved more deeply in my community. My first effort was to become a member of the Cincinnati School Board; lost on my first time out. I was, you know, in my mid-20s and I missed by 500 votes, but I captured about 58,000 votes. And lo and behold, folks thought, hey, there might be a political future with this young man. And so 2 years out, I ran for city council and won on my first race for city council. And I served 12 years at the local government level, years as -- terms as city council member, vice mayor, and ultimately the mayor of my hometown, which was just quite a privilege and honor for me, you know, someone who had grown up in a public housing community that was literally no more than 6 blocks from city hall to ascend to being able to be mayor of my town.
And I tell people all the time I was mayor of Cincinnati after Jerry Springer. (Laughter) You know, and so I kid Jerry all the time. I say, Jerry, you know, that goes to prove that sometimes the sublime does follow the ridiculous. (Laughter) And so we both get a big kick out of that.
I then went on to HUD. I was the undersecretary of HUD with Jack Kemp, who was a long-time friend. And we went into HUD in an interesting period when we were coming in after HUD had been in the headlines for some suspected and some actual scandals. And so as we used to say we had to go in and sort of drain the swamp.
I moved over from HUD after being with Jack Kemp to the State Department where, in working with Jim Baker, I was the U.S. ambassador to the United Nations and I handled the human rights portfolio. I was the U.S. representative to the Human Rights Commission and did most of its business in Geneva. And it gave me an opportunity to travel the world and go into some of the human rights hotspots across the globe.
After doing that and doing that for a bit into the Clinton Administration, I had been working in Somalia, working in Bosnia, and I had led the U.S. delegation to four preparatory meetings for the 1993 Human Rights World Meeting in Vienna that year. I moved on to the University of Cincinnati where former Governor John Gilligan and I were the only two non-lawyers teaching at the University of Cincinnati Law School. When one day I got a call from a friend of mine, George Voinovich, who had -- he was the present and seated governor at that time, but he had been the mayor of Cleveland when I had been the mayor of Cincinnati. And George asked me if I would take an appointment to the post as treasurer of the state of Ohio and then stand for election in November of 1994.
So I took about a year’s appointment, became the chief fiduciary of the state of Ohio. We had under management in terms of custodial work and direct investment work, about $122 billion of assets, which included the assets of the five state pension funds. I did that for -- because I won election in 1994, so I did that for a full term.
And then 1998, I was asked to -- by the Republican Party to run for secretary of state because every 10 years the secretary of state takes on an added dimension of importance. The secretary of state is a member of the Apportionment Board that redraws the legislative map. And in Ohio, the Apportionment Board is controlled by the party that has either the governor, the auditor, or secretary of state, two of those three offices. And in this case, Republicans won all three offices. And so we redrew the maps and those maps met the constitutional test and challenge.
And it brings us up to my second term that I ran for in 2002. So I’ve had an interesting run at local, international, and state governance.
Mr. Lawrence: That’s an interesting point. Why should citizens care so much about character and what should government’s role be in its development? We’ll find out more as we continue our conversation with Ken Blackwell, Ohio secretary of state, when The Business of Government Hour returns.
Mr. Lawrence: Welcome back to The Business of Government Hour. I’m Paul Lawrence and this morning’s conversation is with Ken Blackwell, Ohio secretary of state. And joining us in our conversation is Glen Graham.
Mr. Graham: Good morning. Ken, you had the extraordinary opportunity to serve at the federal, state, and local level as well as diplomat. Can you tell for us a little -- can you explain for us a little bit about the difference you’ve seen in management styles and culture and personnel on those different areas?
Mr. Blackwell: The difference is generally driven by scale in terms of not only the size of the organization, but the comprehensiveness and depth of the constituency or constituencies that are served. In local politics a mayor, you can feel him, touch him, get at him, so accessibility is much more a dominant factor in local governance and management and leadership considerations. When you’re a governor, when you’re a secretary of state, or a treasurer and you’re in Columbus and you’re, you know, in a huge state, constituents have considerably less access to you. And so you don’t have that same relationship feel as a mayor or county commissioner or a township trustee might have.
One of the things that runs through all of those levels of government and affects management and leadership style is the ability to communicate and the ability to not only communicate a vision, but an ability to communicate the essential results that the organization must achieve. Let me just give you an example. Max Kappelman (phonetic) was one of my mentors at the U.N. and at the U.S. State Department. And, you know, I told Max I was thrown into the United Nations and he told me don’t worry about it. He said let me just explain something to you. The U.N. is, the United Nations, a city hall with interpreters. (Laughter) You have to have the same sort of communication ability. You have to be able to knock on doors. You have to be able to sit down and engage people in conversation. You have to be able to articulate what it is that you want to achieve. And then you have to be able to get people -- you have to be able to pull people together with sometimes conflicting interests to get something done. And he made a connection for me. You know, I could take my skills as a negotiator in labor management issues at the local level and sort of scale up to the international level, but it was those same basic skills.
When we were at HUD it was fascinating to me because we went in and what we had to do was sort of rationalize the system. Within that organization there were probably 77 different and often confusing management systems. And so the big challenge within that bureaucracy and given the scale was to get in and try to rationalize a system, a system that was operated and influenced by two personnel systems. For instance, you had the career civil servant and you had the political appointees. And when I was there, and I’m not sure that it’s not unchanged today, the average shelf life of a political appointee was 18 months. And so the career, you know, civil servants used to say and they shoot and they, too, shall pass, you know.
So it was -- and that was complicated when you went over to the State Department and you saw not only career civil servants, political appointees, but career diplomats, folks who were in the foreign service professionally and it just made for interesting interrelations and interaction. And the key management strategy and feel was still communication and being able to pull people together. And so what I’ve found at all levels of government is that an effective leader, an effective manager has to be able to, you know, inspire with their -- through their personal example of people can’t see a hypocrite, they can’t see duplicity. They have to see you walking the talk and not just talking the talk.
The second thing is that you have to have an agenda, an action agenda that creates results and creates opportunity or that inspiration has a short shelf life. But the big challenge in the workplace today at all levels is to be able -- is the ability to pull together a diverse workforce, to pull people of divergent interests and backgrounds into a team. And I think that those things are all related. And it’s been interesting to see, you know, just how as time and technology has influenced -- sort of reduced the time flow on how those things sort of impact you on a day-to-day basis.
Mr. Lawrence: Well, it’s interesting you mentioned an agenda because in our last segment you talked about the Center for Civic Character and you described the Guide to Uncommon Sense. Could you tell us more about this guide? And as you were describing it briefly in the last segment I was wondering after I read it what do I do?
Mr. Blackwell: Well, after you read it we have a constant internal discussion and feedback mechanism where we not only work it at our staff meetings across the agency, we evaluate it in our annual performance evaluations. Are people actually living it or are they just giving lip service to it?
On the outsides of the organization we have the Better Business Bureau of Central Ohio that uses Uncommon Sense as a way of measuring effectiveness and performance. And they actually use it as a criteria upon which they judge the awards that they give called the Integrity Awards to businesses. We have about 18 universities that use it in their student development programs. And so for all of those external groups it’s a customized mechanism.
The center’s actually a virtual center, you know. There are about four or five employees that are dedicated to it and these are folks who are expert at training and communicating and facilitating group discussion. And they will go in and they will sit down and they will -- whether you’re talking about a business leader, a leader of a student group at the university, or folks that also use it are Jim Trusso and the Ohio State Buckeyes, they use it in terms of their leadership and team-building process -- we go in and we customize for them and help them facilitate their own game plan around these principles. There is no cookie-cutter approach here. We tell people that they have to get their own buy-in and then work their own strategy. Because what’s really key is the authenticity, the sense of genuineness that people perceive in the operation.
About 18 years ago, I read a book called Habits of the Heart, written by Robert Bellah and three or four other people, and in that book they advance a principle called moral coherence. And moral coherence is when you get your behavior to line up with those things you profess to believe. You have moral incoherence when you talk one way, but you walk another. And so we try to tell people that what’s essential to a culture of an effective organization is that sort of moral coherence within the organization and particularly moral coherence in how the leadership is perceived. You can’t, you know, say do what I say, not as I do in the world today because people take their key off of the leader’s behavior.
So we go in and we go in and we preach and teach, you know, that sort of principle. Because what is at risk today in business organizations, government organizations, higher education, people believe that there is a disconnect, that there is a bankruptcy of ethics. And so we go in and say the key to making this work in any culture is leaders how live it and believe it and pass it on.
Mr. Graham: Ken, what are you -- what’s the feedback you’ve received from other public officials?
Mr. Blackwell: It’s been fascinating. We now use it in our effort to tell people how important it is that their campaigns be guided by these uncommon sense principles. People are looking for character-based leadership. But from my standpoint as the state’s chief election officer, I want to give people a renewed sense of faith in the dignity and the integrity of the political process. And it’s an easier sell for me today because, you know, ranked below politicians today are corporate leaders, you know. (Laughter) And so now I have corporate leaders’ attention. You have college coaches who are coming in and saying, you know, this is important to the character development of my teams. And so we believe that it is building the moral authority to lead that is so essential in transforming or for leaders or managers to transform their organization.
Mr. Lawrence: That’s an interesting point. In Ohio, the secretary of state is also responsible for running elections. What’s the state of election administration in Ohio now? We’ll ask Ken Blackwell, the Ohio secretary of state, to tell us more about this when The Business of Government Hour returns.
Mr. Lawrence: Welcome back to The Business of Government Hour. I’m Paul Lawrence and this morning’s conversation is with Ken Blackwell, the Ohio secretary of state. And joining us in our conversation is Glen Graham.
Mr. Graham: Ken, during the 2000 presidential election there were many questions regarding the voting system and election process. What do you think of the Florida recount and what are your thoughts on the punch card ballots that were used?
Mr. Blackwell: I was in Florida for the controversial 35, 36 days where, you know, things were going back and forth around the final tally of votes. And I was there and I watched in an up close and personal way the tables where the recount were taking place. And so you could see somebody at one table, you know, holding a ballot up to the light and saying, oh, I see light around this chad so, therefore, that’s a ballot -- I mean, that’s a vote. And then you had the pregnant chad, the hanging chad, the dimpled chad, you know, you-name-it chad. And there were no statewide standards that said that no matter where you are in Florida, if you use a punch card system this is what constitutes a legitimate vote.
Contrast that with Ohio. We had statewide standards and so we have -- at that time, we had 70 counties that were using the punch card system of our 88 counties. And so whether you were in the Northeastern corridor or the Southwestern corridor, if you were voting on a punch card machine in Ohio, you didn’t have a question about what constituted a vote because you had the statewide standard.
So it was the absence of a statewide standard which drove the whole notion of equal protection under the law that opened the door for federal intervention and consideration there was a problem. So you saw a lot of focus on the punch card system as being the culprit in that situation. It probably was a combination of an antiquated and outdated technology and the breakdown of architecture built around that technology that would have included standards and a professional oversight that would have eliminated some of the controversy.
But we did focus on the punch card system. And recently the -- well, last year, in October, the President signed the Help America Vote Act, which basically targeted the punch card system for elimination across the country. In Ohio, we have started to implement the Help America Vote Act and we are now waiting on the flow of federal dollars to be complete so that we, in the next year, can eliminate the punch card system. What we’re looking for is a system that is more reliable, more accurate, and easier to use, and this new technology provides us with that capability.
Now we’ve had a hiccup in July of this year. Johns Hopkins University researchers started to raise some serious questions about the vulnerability of electronic touch pad systems, which are the dominant systems in the new technology. And that has caused us to have to construct a very robust security validation testing and evaluation process, which we’re now running the vendors who have made it through our process, we’re running them through this robust validation, the security validation process. We think that by the end of the year we will have sufficiently kicked the tires on the new technology and then we know that it’s very, very important to protect against and give people the full confidence that they are protected against voter fraud and that the final counts actually reflect the voters’ will. We will have to make sure that our architecture around this new technology, the procedures, policies, and personnel are tight and well-trained.
Mr. Graham: Ken, you mentioned the Help America Vote Act. Were you involved in any of the legislative discussions around that and do you think that that sweeping reform was necessary?
Mr. Blackwell: I was deeply involved. Luckily for me, the chairman of the committee on the House side that dealt with election reform was Bob Ney. Bob Ney is not only a colleague and an outstanding leader, he’s a friend. And so I was intricately involved in working with Congressman Ney and his staff. And then Steny Hoyer on the House side, but on the other side of the aisle, and I worked -- and his staff worked many hours together. On the Senate side, Congressman Dodd and his staff worked tirelessly and we also worked with Senator Mitch McConnell. So I was involved.
I went up and I spoke to the committees on both the Senate and the House side about what I thought had to be in this bill. And I’m deeply appreciative that some of my ideas were incorporated in the final bill that was passed.
Mr. Graham: Ohio recently approved a list of vendors to supply Ohio counties with new voting machinery. Can you talk about the process and the challenges that the Help America Vote Act provides your office?
Mr. Blackwell: Unlike some other states, like Georgia, our state legislature said that we could only embrace this election reform if the federal government was going to pay for it. And so the Help America Vote Act became essential to us in Ohio. And the dollars associated with it became even more essential because without those dollars we can’t get it done. But we set up a very elaborate evaluation process of the vendors that wanted to supply this service to the people of Ohio. And we ended up with four vendors and we ended up with them initialing preliminary contracts, which would provide Ohio with not only four providers, but two systems: the electronic touch pad system; and what is called the optical scan precinct count system, which is the optical scan is like the old SAT test where you color in the oval and then it’s electronically scanned and gives you quick results.
But the difference is, one, there is less paper involved with the voter and the optical scan still involves paper. And a lot of people feel just more comfortable with being able to see how they’re voting as opposed to this or the electronic touch pad system.
We feel real good about our ability to deliver. We got the best price in the country. We brought in a team of experts, computer science experts, and trained negotiators to complement my internal staff and we negotiated the best price in the country. One of the deals that we were able to negotiate is that if, in fact, these companies go out and give any other state a better deal, we get their price. So we feel real good about what we were able to do and the comprehensiveness of our package in terms of training, of election officials, of public education component, the maintenance and warranty components, and Election Day service.
We have one of the best packages ever put together. And the National Association of Secretaries of State and other election -- associations of elected officials have used this and actually made sure that these -- our plan was -- and contracts were distributed to others so they could use them as models.
Mr. Graham: What type of changed management processes are the vendors suggesting that you put in place to help voters use these new machines?
Mr. Blackwell: The first and more interesting thing is that we had to make sure that people understood that you can have all the modern technology that you want, if, in fact, the election officials didn’t understand it and couldn’t convey confidence to the voting public, then there was going to be a breakdown. And the essential ingredient in the election process in a free democracy is the belief that the final vote actually reflects the will of the people. And so it is understanding that you can’t manage elections from -- and administer elections from Columbus, Ohio, or any state capital, that you’re still dependent on the execution of a well-managed election at the local level.
And so that goes back to setting objectives, making sure that people understand the anticipated results, and then making sure that they are sufficiently educated at the local level. It doesn’t do me any good to be able to be the world’s most articulate secretary of the state on these matters and I haven’t been able to communicate that at the point of execution, and that’s the local level. So we put a lot of emphasis on working with our 88 county boards of elections, making sure that they are well trained and most -- and well equipped.
You’d be surprised at the politics of it all. And I say that in a sense that county boards of elections have to get most of their resources from county commissioners. And these county commissioners in Ohio basically are saying, look, we were not Florida. We didn’t have a fiasco and what is this new technology going to cost us, you know? And so you only have -- you just don’t have the confidence issues, you have the cost issues that people perceive as being problematic.
But when -- my job as a person who has been in the position of being a fiduciary and a locally elected official, I had to go down and talk to those county commissioners and say, look, just basically understand something. We now have a punch card system and we have a rule in Ohio that says each election you have to print up 102 percent of the number of registered voters in your county. And when you have elections for only 19 percent, 36 percent, you have enormous waste of printing and paper costs. With these new technologies you don’t have that waste. And so there are repurposed dollars that you can put against the maintenance, professional training, public education. And once you sit and work people through it they begin to get a better understanding and they embrace the technology. People resist change and, unfortunately, a lot of people, you know, are 21st century Luddites. (Laughter) They want to just smash the new technology before they tackle it and attain it.
Mr. Lawrence: What does E-government mean in Ohio? We’ll ask Ken Blackwell, Ohio secretary of state, to give us his perspective when The Business of Government Hour returns.
Mr. Lawrence: Welcome back to The Business of Government Hour. I’m Paul Lawrence and this morning’s conversation is with Ken Blackwell, Ohio secretary of state. And joining us in our conversation is Glen Graham.
Well, Ken, in the last segment we talked a lot about the logistics of elections, but you’ve also been outspoken about the need for campaign finance reform. Could you describe your thoughts and also tell us about campaign finance reform efforts in Ohio?
Mr. Blackwell: People understand that money is the mother’s milk of campaigns. But the question that always arises is what is the influence of money and can you follow the money? And so transparency becomes a driving issue in all campaign finance reform discussions. And in Ohio, we’ve placed a priority on moving towards full disclosure.
I happen to believe that every dollar that’s involved in the political process should be fully disclosed. I don’t get so caught up on how much money one contributor or a group of contributors contributes if I, in fact, as a voter and as a taxpayer can understand how much money they’re giving. But when they can hide that money and have an impact that is not fully disclosed I think what you do is you drive voter confidence down because they begin to believe that that money has a greater influence than their particular level of participation. And so you’ve seen a tremendous falloff in civic engagement and voter participation not only across the state of Ohio, but across the nation.
And so campaign finance reform, driving for full disclosure, is a way of making that whole process more transparent for the purpose of building voter confidence and encouraging broader participation.
We in Ohio were recently a part of a study, a joint study done by the California Voter Foundation, the Center for Government Studies, and the UCLA Law School. Ohio ranked as the fourth best state in the Union for campaign finance disclosure laws and practices. And we scored number one for our electronic filing program, which we feel real good about because it allows participants and observers of the political process to get information quickly about the impact of money and who gave what to whom. And then we ranked third for public accessibility to campaign finance data. So we’re going to drive from third to number one there and from fourth to number one in the country.
Mr. Graham: Ken, earlier this morning you mentioned your Business Services Division. Can you detail some of the changes that have taken place since you’ve taken office?
Mr. Blackwell: It’s a great example of how you use modern technology to transform a unit or an organization. When I became secretary of state one of the great challenges was that I understood that my office was sort of the gateway to business opportunity. It all started with our office. That’s where you got your corporate identity and you incorporated your business. And when we took office in 1999, it was taking about 15 weeks to incorporate a business in the state of Ohio. Today, we’ve moved that through the use of E-mail and Internet technology and toll-free telephone numbers and we’ve been able to reduce that to 1 to 3 days and, in most cases, you can get it done in 1 day.
What we had to do there was make some major changes in the infrastructure and in the technology infrastructure. For example, when I went in I sort of managed by walking around. And so I was starting on my first day to get flooded with complaints about how slow the office was moving on incorporations. I asked people some simple questions. How many phone lines do we have? We were getting about 125,000 calls a month and we only had 11 phone lines, you know. And so I knew instantly we had to get more phone lines. And so we instantly moved up and went over and had them make the case to the legislature to get about 102 phone lines.
We then started to look at Internet technology and said how much of this can move towards a 24/7 operation and move to the consumers through the use of the Internet? And then we really found that the people who didn’t like standing in line saw the E-mail communication as a way that they could communicate more effectively with us in a more time-efficient way. So by using these technologies we were able to radically reduce the time that it took to incorporate a business. But we made people understand that we were part of an operation, part of a state that wanted to be more inviting to business and make it easier to start and to do business in the state of Ohio.
But it also had to -- that transformation involved changing the way that we did things with our people. We had a relatively high absentee rate. People were not cross-trained. And so we, in fact, had to create incentives and sanctions and expectations that we expected people on the job and that the job could actually be fun. But what we found out was that it was so taxing and so exhausting because they didn’t have the training and the technology to make it easier, they were swamped and they were burnt out. And instead of, you know, just taking it day-in and day-out, in some units there was an absentee rate of, you know, upward to 20, 25 percent a day. So we changed all of that through our Uncommon Sense Program, making people understand that they matter, that they were part of a team, but that they had to actually live the change that we were advocating from the top of the organization all the way to the base of it, and we were able to get that done. And now people actually feel good about what we’re doing.
We were able to move our entire operation, reduce our dependency on general tax revenue by 64 percent over a 5-year period. We are now operating on an enterprise model where we -- our dominant revenue comes source of revenue comes from user fees that are based on the real cost of delivering a service, not one penny more. People actually, when they can see the value of those user fees, they pay it with a smile. And that’s what we’ve been able to accomplish. We drove a cultural change, which actually changes the way we do business and the way we embrace technology.
Mr. Lawrence: I thought it was interesting as you described that you described both the technology and people. So I’m curious, how would you summarize the lessons learned from that experience for others?
Mr. Blackwell: Any technology in and of itself can give you efficiency, but not necessarily give you effectiveness if you don’t bring people around to, first, embracing the technology and then mastering it, and so that’s been our key. And so in a cultural sense what we say is that competency and character standing alone or good traits in and of themselves, you fuse competency and character. And not only do you get, you know, a better workforce, you get better results and you have people who enjoy delivering those results.
Mr. Lawrence: Ken, you’ve had a very interesting career that’s rich with experiences. What advice would you give to a person interested in a career in public service?
Mr. Blackwell: I think, first, probably would be what I tell people with any professional development aspirations, know yourself. Be comfortable in your own skin. Understand that, you know, if you want to be a self-starter and a self-manager and a leader that it really starts with your internal compass; that people read your behavior more so than they hear your words, you know. So live what you say that you believe. And if you do that you have a chance of inspiring others just through your example. And that applies to anyone in a public service career or a private sector career, people who aspire to be leaders.
And I guess my grandmother gave me some good advice when I was growing up. She said, you know, there are three books that you need to master and if you master them you will have mastered the art of good living. She said the first is your datebook or your calendar. It tells how you spend your time and with whom you spend it. And I found out that effective leaders and effective people tend to spend their time with other effective people and people who are of strong character.
She said the second book is your checkbook. She said how you manage your resources actually will indicate what’s important to you. And in government, you know, we can do a lot of things with the resources that we have, but we can’t do everything. So we have to make some tough public choices about what it is that we do, what our competencies are, and how we do those things well.
She then told me that, you know, in my family we were a strong Christian family, but it could have been a grandmother in a strong Muslim or Jewish family or, you know, Hindu family. My grandmother said it was the Bible. And she said this, in fact, will help you choose the path of conviction over the path of convenience. And for me that’s been the key, to understand that, you know, my leadership is not only character-based, but faith-based and that there is a roadmap for me.
And those three books, you know, how I -- am I a steward of people’s money as if it was my money? Who do I associate myself with? And, you know, what is my internal moral compass, my character development driving force that allows me to live the change that I, in fact, advocate?
Mr. Lawrence: Well, Ken, Glen and I want to thank you very much for joining us. I’m afraid we’re out of time. Thank you for squeezing us in your very busy schedule.
Mr. Blackwell: Well, thank you all. I -- if there are listeners out there that want more information, please go to www.ohiospirit.org.
Mr. Lawrence: Thank you very much.
Mr. Graham: Thank you.
Mr. Lawrence: This has been The Business of Government Hour featuring a conversation with Ken Blackwell, the Ohio secretary of state. Be sure and visit us on the web at businessofgovernment.org. There you can learn more about our programs and research, and also get a transcript of today’s very interesting conversation. Again, that’s businessofgovernment.org.
This is Paul Lawrence. Thank you for listening.