Originally Broadcast December 8, 2007

Washington, D.C.

Welcome to The Business of Government Hour, a conversation about management with a government executive who is changing the way government does business. The Business of Government Hour is produced by The IBM Center for The Business of Government, which was created in 1998 to encourage discussion and research into new approaches to improving government effectiveness. You can find out more about The Center by visiting us on the web at businessofgovernment.org.

And now, The Business of Government Hour.

Mr. Morales: Good morning. I'm Albert Morales, your host, and managing partner of The IBM Center for The Business of Government.

In many respects, we are a nation at a crossroads. In the delivery of critical human service programs, policymakers and managers must consider issues such as fundamental reform, funding and financing, and program flexibility to focus on outcome measures and not just the process. In the end, the success of human service programs is measured by the health and well-being of this country's citizens.

As part of a series of discussions on managing human service programs, we have broadened our reach in this space and are honored to welcome our special guest this morning, Jerry Friedman, executive director of the American Public Human Services Association.

Good morning, Jerry.

Mr. Friedman: Good morning, Albert. It's a real pleasure to be here.

Mr. Morales: Also joining us in our conversation is Nicole Gardner, vice president and partner in IBM's public sector social services practice.

Good morning, Nicole.

Ms. Gardner: Good morning, Al. Good morning, Jerry.

Mr. Friedman: Good morning.

Mr. Morales: Jerry, let's start off by learning a bit more about your organization. Perhaps you can give us an overview of the mission, the history, and the activities of the American Public Human Services Association.

Mr. Friedman: Well, thank you for the opportunity to be here this morning. We always look forward to venues in the public arena where we can talk about human services. The American Public Human Services Association is a 77-year-old organization that started around the same time as the Social Security Act. It was really founded by a group of very visionary administrators who were concerned about what back then they called the distribution of relief. They wanted to have a voice in policy in Washington, D.C., and they wanted to look at best practice. And essentially, that is what our organization has stood for for the past 77 years.

We've undergone several changes. We used to be called the American Public Welfare Association, focusing in on those types of programs. But we've actually broadened our horizon, recognizing that there is a realm of human service programs that need the kind of attention that a national association can give it.

Essentially, our mission is strengthening America through excellence in public human services. I think a lot of people don't realize just how large human services is, and the presence that it has in our society. We are generally one-third to one-half of most state and local budgets, and consequently, we have a large business to run and an obligation to run it effectively. But it also is a compassionate business, so we have kind of this desire to make sure that we're maximizing our resources, but doing it in a kind and compassionate way.

Basically, our association does three things. We work for good public policy. Good public policy meaning that there are adequate resources, that there's flexibility to run the programs, that we can actually look at outcomes and invest in clients rather than in the bureaucracy.

We then work with our members to help them implement that policy in the correct way. We do this through training and research and consulting.

And then the final area that we do is we really work on our public image. I think we can be successful mainly to the extent that the public has confidence in our ability to manage our programs efficiently and effectively. And we do that through radio shows, we do that through our website, through our magazines, publications, newsletters, informing the public as well as the profession is a key component of APHSA.

Mr. Morales: Could you give us a sense then of the scale of the operations at your organization and its affiliates? Can you tell us a little bit about who are some of its members and the size perhaps of your budget and the number of employees?

Mr. Friedman: Sure. In many ways, we serve like the National Governors Association does for governors. We perform the same function for the governors' appointed heads of health and human services programs, the state CEOs.

Our core group really are the states. And I've been very pleased that for the past four years, every state and a number of the territories have been full members of APHSA. That's very important to us, because when we go to Congress and we go to testify to say that we represent states, we truly do. Every state is a member.

We then have several hundred local members, counties, areas as large as New York City and Los Angeles to Tioga County, Pennsylvania, that likes to pride itself in being an area that doesn't have any traffic lights or parking meters, so we have that range. And then we have several thousand individual members.

We're a moderate-sized association. We rely a lot on our membership to provide the kind of support to enhance the field of human services. We have approximately 50 employees; sometimes there are more when we get special grants and projects. And we have an operating budget of around $5 million.

Ms. Gardner: So Jerry, now we understand a little bit more about APHSA. You're the executive director. Can you tell us what you do in your job? What does it entail?

Mr. Friedman: I would say that there are probably three major activities that I'm involved in. The first really is association management. We're unique, I think, in that we have to be very sensitive to the fact that our members operate public entities. We treat every dollar that comes into APHSA as if it was a tax dollar, because in many instances, it is. And so we've very sensitive to making sure that we provide the kind of return on the dollar. So just running the association, our own computer systems, our own budgeting processes, our own personnel, occupies a portion of my time.

Probably the largest portion of it is involving member services: meeting with our members, trying to get a sense of areas that they need us to focus in on; sharing best practice.

And then, of course, there's the work that we do on Capitol Hill and with the administration as well as other associations, partnering with them in trying to obtain good policy, good effective resources in the work that we do in Washington, D.C.

Ms. Gardner: In the context of all that, what are maybe the top three challenges that you face? And what kind of things are you doing to address those challenges?

Mr. Friedman: We certainly have the vast array of human services challenges that all of our members face. Internally, you know, we also have challenges in managing during difficult economic times. When states have downturns, when the revenues decline, that also affects our revenues, so that we've had -- from time to time, had to manage during difficult times.

Staff retention is a big issue for us. We're very fortunate in that being in business for so long and having a reputation, which I think is excellent in this city, we're able to attract very, very talented individuals. They gain national exposure. They get to meet with every state CEO. They get to meet with members of Congress. They get to hang out with other associations. And very often, they get recruited because they are talented. So we probably have a higher -- just by circumstances, a higher ratio of turnover than many other organizations.

And, you know, one of the difficult things for me is that most of our core membership is appointed by governors. When their terms expire, they move on to different things. And we develop these relationships, and it's very difficult sometimes to deal with a lot of turnover within the states.

But I think the main challenge in human services, and I think it's also true for our association and all of its components, is truly our public image. The ability to tell our story not only just in Congress, but to the general public I think is critical. We face very unique challenges in human services. We're one of the few industries that is literally working to put itself out of business. We strive for a better society. We strive to alleviate poverty. We strive to eliminate child abuse. And if we're truly successful, there wouldn't be a need for us.

On the other hand, our failures are very visible. We can be successful in dealing with thousands of children. And when we have that unfortunate situation where a child gets lost, of course the public rightfully is outraged as we are, and that draws attention to us. We conduct our business in the open. We're the American Public Human Services Association, and that means if we make a mistake, you're going to read about in the front pages of the newspaper. And often, corporate America and the business community and even the other nonprofit organizations don't have that kind of exposure. So we have unique problems, but we also have unique opportunities, and I think all of this makes us stronger.

Mr. Morales: So Jerry, with that type of a mission, I'm curious, how did you get started in this field? What prompted you to get into this?

Mr. Friedman: Well, I was very fortunate in that I started my career as a probation officer. That may sound like a very strange answer, but when you think about it, what a probation officer does, there's a law enforcement aspect to it, but then on the other hand, there's kind of a case management function. You know, when somebody's coming out of prison, they need a job, they need housing, they need treatment, they may be addicted to drugs and alcohol and you have to work with that. And what I learned from that experience was that very often, the human services system broke down for people, and it was mainly because of the way that we were structured within a categorical system. And that really shaped a lot of my early thinking about how we could provide services in a different way, how we could have a more coordinated strategy for dealing with the multiple problems that people were facing. And so I had this exposure to the broad array of human services through that experience.

I then was fortunate enough to kind of have a career progression that led me to be a county human services administrator in two different counties in Pennsylvania. And then I became a state director of public welfare in Pennsylvania. Later, in Washington state, I was in charge of the Economic Services Administration. And before my job at APHSA, I was the executive deputy commissioner for the Texas Department of Human Services.

What that gave me, I think, was good, practical experience in actually providing the services at the county level, but then having the state experience. And through that, I touched various systems, everything from health care to child welfare to mental health, drug and alcohol programs. And so when the association was recruiting for a new executive director, I think that they wanted somebody with both state and local experience, and having that kind of broader perspective of having administered a wide array of programs.

Mr. Morales: So as you reflect back on your career, is there one aspect of that that you feel has really shaped your current leadership role and perhaps informed your current style?

Mr. Friedman: Albert, the one asset that I think that I bring to APHSA is a 25-year history of being a member. This association was my safety net. When I absolutely needed information and needed it quickly, I had them on my speed dial. When we had public policy that we needed changed -- I can give you a very good example -- and that was with welfare reform when there was a provision that legal immigrants were not entitled to food stamps. Our state legislature and our governor, I was in Washington state at the time, said this is unacceptable, find a way to make a change. It was APHSA, our association, that led the change in Congress that allowed states to purchase food stamp coupons for this population. So I came in with a great deal of passion about the association and the work that the association does as a consumer and as a member.

So what I bring to the association is I have such talented co-workers, oh, they're working on their Ph.D.s and their law degrees and they're just extraordinary, but I can look at something that crossed my desk and say if I was a member, would this make sense to me? And so as long as I think I can keep that member perspective, I'll be able to enrich the association to some degree.

Mr. Morales: That's fantastic.

What are some of the lessons learned from welfare reform efforts? We will ask Jerry Friedman, executive director of the American Public Human Services Association, to share with us when the conversation about management continues on The Business of Government Hour.

(Intermission)

Mr. Morales: Welcome back to The Business of Government Hour. I'm your host, Albert Morales, and this morning's conversation is with Jerry Friedman, executive director of the American Public Human Services Association.

Also joining us in our conversation from IBM is Nicole Gardner.

Jerry, we've used the term "public human services." Can you elaborate exactly what that means?

Mr. Friedman: Well, there's a debate actually on what public human services are. At one point, it was human services that were provided by government employees, but I think that that's changed a great deal with privatization efforts, with partnerships, with contracting. So now we define it more as services provided under the public aegis, where government dollars are used and there's a level of accountability, but it could be provided by a number of different associations, organizations, companies, both private and not-for-profit.

Mr. Morales: Let me go back in time a little bit. In the 1990s, government had made a statement to end welfare as we know it back then, which launched a series of welfare reform initiatives. Could you remind us of some of the key elements of this welfare reform, and from your perspective, how significant a social policy change does this welfare reform effort represent?

Mr. Friedman: If I look back on events that happened in my career, I think welfare reform was probably the most significant change in social policy in my lifetime. And what it did basically was that it ended individual entitlements for people and gave states block grants with considerable flexibility for states and local governments to design programs that made sense to them. Included were some provisions, like time limits, lifetime time limits, work requirements, just a vast array of significant changes to the way that we looked at what had been a dependency program to one that became a program of self-sufficiency.

In many ways, I think some of the lessons that were learned through welfare reform are really beginning to permeate some of the other human services systems as well. But all in all, I think welfare could be considered a successful program in the United States that brought about significant change.

Ms. Gardner: So Jerry, in that context, tell us a little bit about some of the key lessons we learned in welfare reform.

Mr. Friedman: Well, first, if I could just talk a little bit about some of the successes. And you have to realize that the AFDC program had been in existence for many, many years. It was a well-entrenched program basically operated through federal rules. And so when the new law came into effect and states were empowered to develop their own and design their own programs, there was a great deal of both apprehension as well as a great deal of high expectations for welfare administrators who had really wanted to do something different with the program for a considerable period of time.

It's important to note that welfare reform didn't actually start with the new law. There were over 40 states who had gone to the federal government to seek waivers to say we think that we have a better solution to helping people become self-sufficient. And what the federal legislation really was were some of those common threads through all of those various waiver programs.

But when you look at what happened over the course of a decade, there was a 60 percent decline in welfare caseloads in this country. Child support collections for non-custodial parents doubled. Over 1.5 million welfare recipients who had previously never been attached to the workforce had gainful employment and were no longer reliant on the public welfare system to support them. We implemented a national electronic benefits transfer program, a large computerized effort that actually eliminated food stamp coupons in this country. We created hundreds of thousands of child care slots. We invested in prevention programs that resulted in a decline in teen pregnancy among welfare mothers of one-third. And for the first time, reversing a two-decade trend, we actually had a decline in child poverty rates in this country. So by all accounts, you would consider that a success.

Well, there were many lessons to be learned through that. First, there was a really compelling case for change. Welfare dependency was a bad investment strategy, basically supporting somebody. It didn't help grow our society or our economy or the self-image of those who were receiving those benefits. So that we learned that there was kind of both an economic and a moral imperative for change. Yes, indeed, we are a compassionate society. We are our brother's keeper. But on the other hand, we had an obligation to help people maximize their own personal potential and develop their own capacity.

We learned that personal responsibility can be very effective public policy; that in life, there is a quid pro quo; that reciprocity is just the way that we live as Americans, and that its public policy should reflect that. We learned that people can rise to the occasion, that when they were afforded the opportunity, people became job-ready. They invested when there were both incentives positive and negative. People reacted in that they did want better things for their families. We learned, I think, that the best service delivery was designed at the local level. Welfare reform was not a national strategy. It was saying here's the money, here are the resources, develop a local strategy, and that resulted in those successful efforts.

We learned that we had to rely on partnerships, that welfare in this country couldn't be fixed by government. It required corporate America, the business community, the nonprofit world, the faith-based world, education, all coming together in kind of a uniform strategy to help address this. We learned the importance of services coordination and integrating services. What happened with lifetime time limits was that the bar was raised. We had a finite period of time to have people become job-ready or they would lose this safety net. We know that people don't come to welfare offices simply because they have empty wallets and empty pocketbooks, that there's often just a myriad of other problems that exist, and that we needed to address those. And that required the agencies that provided those services to get together in some kind of coordinated strategy. We also learned that there were other multiple strategies that we needed to look at: asset building, predatory lending. You know, there's a whole industry that thrives just because people are living in poverty.

I think the most important lesson, though, was, you know, for years people railed about the public welfare system, and I was one of them, to be honest with you, that it was a failed system. Well, what we learned was it was failed policy. When people are penalized, when their family condition or economic conditions are worse off because they're trying to better themselves and become employed, when they actually lose money, when the most responsible thing that they can do financially for their family is to stay on welfare rather than try to get to work because they'll be worse off, that's failed policy.

When that changed, we demonstrated it was not a failed workforce. The welfare system, this huge entity in this country, literally turned on a dime. Welfare offices almost overnight were transformed from "welfare offices" to "work centers." You know, the message was clear: What can I do to help you get a job today? This magnificent welfare workforce absolutely transformed themselves because they wanted to. They saw firsthand every day how just handing somebody a check and food stamps and hoping that every problem went away was foolish policy. And when that changed and they could make a real difference, they really rose to the occasion.

Ms. Gardner: That's quite a story. So you mentioned a few minutes ago reauthorization. So where are we with the reauthorization of TANF, and kind of what's the status? Where are we going?

Mr. Friedman: TANF was reauthorized after about 12 or 13 continuing resolutions. We just couldn't seem to get congressional attention because of all of the other priorities. And at the very end of the legislative session last year, as part of the Deficit Reduction Act, TANF reauthorization was passed. As an association, we are very concerned about the kind of micromanagement that's been built back into the welfare system. We think that the broad strategy of providing goals for states to reach, and empowering communities to reach those, worked. Clearly demonstrated that. And so we're concerned that we've taken a huge step backwards when it comes to welfare reform. And administrators, rather than talking about how can we get people into gainful employment, how can we help them get better jobs, how can we improve their economic conditions, they're talking about how we can have something count as a work participation credit because of the penalties that they're going to be facing. We're working very hard to minimize any damage as we see it to this program. To continue to empower states, we strive for maximum flexibility, but we're going to have an uphill battle.

Mr. Morales: Now, Jerry, you mentioned earlier that welfare reform really began at the state and local level. And I believe today, we again are seeing state agencies developing innovative public policy agendas to shape the next decade of service to low-income families. Could you elaborate on some of these innovative state programs? What are some of the strengths that you're seeing in some of these programs?

Mr. Friedman: Well, again, I think drawing off some of the success that we had with welfare reform and just looking at public policy that empowers communities, we're seeing this play out in child welfare programs, we're seeing this played out in health care programs. If you went to a Medicaid director 20 years ago and you said what is your job, they would say my job is to pay bills timely, accurately, and efficiently, and basically they did that. If you ask a Medicaid director today what is your job, well, they're part of a governor's health cabinet. They're looking at universal coverage. They're looking at strategies to cover the uninsured. They are looking beyond just paying bills to what are the best treatments and interventions that we can provide? Where do we get a return on the investment? How can we engage consumers? Now can we embrace prevention and wellness programs?

It's an exciting time right now because of a lot of flexibility that's been given to states around health care design. And I would contend that the real leadership for this is not happening within the confines of Washington, D.C., but it's happening in the statehouses throughout the country.

I think the same is true with public child welfare. Welfare administrators are saying, you know, if I could take the resources that it takes to buy foster care and invest in strategies to build stronger families in the beginning, investing in prevention, investing in interventions that help people become better parents up front, then we could save all this money on the back end. But more importantly, children thrive better in families than they do in foster care. It's more than intuitive. It's supported by all the research and by all the evaluations that happen. So what I see happening now are administrators throughout this country, states approaching the federal government just like they did with welfare reform, saying we think we have a better solution based on our local conditions, by the assets and the resources within our community, and our ability to mobilize them.

The other thing that we didn't have 25 years ago, when I was running programs, is we have more supportive technology. It used to be very hard to keep track of all of the records that you needed and the requirements and the rules and regulations when you had six or seven or eight different categorical programs with rules and different requirements. But with computer systems now and the ability to process information, it is much easier, I think, to manage those programs within the compliance rules of the federal government.

Mr. Morales: So Jerry, it sounds like, you know, really workforce strategies are really sort of the key to success here in helping families manage this transition that you describe. But can you give us perhaps some specific examples of programs that are out there that you think are really innovative and are working well?

Mr. Friedman: Well, there are thousands of them. And I think, again, the key was that public administrators were set free to go out and to develop strategies that worked.

You know, one of the things that we used to do, I used to do this when I ran welfare programs, was to go to corporate America and to business and say wouldn't it be nice if you hired somebody off the welfare rolls? You know, it helps the community and it's the right thing to do. Now we can go to corporate America and the business community and say we can help you build your business. We can help your bottom line. We can help your profit. We can do that through tax credits. We can do that through customized job training. We can do that through extended medical assistance coverage and child care subsidies. We can do that through working with new employees to help train them through orientation. So people see this as a better business strategy than they used to as just a social service.

Mr. Morales: So it's about collaboration.

Mr. Friedman: It's about collaboration. It's about partnership. But it's also -- it's about investment. Good public policy, good social policy, good human services policy and making profit don't have to be mutually exclusive principles.

Mr. Morales: That's a very good point.

What emerging technologies hold the most promise for improving human services delivery? We will ask Jerry Friedman, executive director of the American Public Human Services Association, to share with us when the conversation about management continues on The Business of Government Hour.

(Intermission)

Mr. Morales: Welcome back to The Business of Government Hour. I'm your host, Albert Morales, and this morning's conversation is with Jerry Friedman, executive director of the American Public Human Services Association. Also joining us in our conversation is Nicole Gardner, vice president and partner in IBM's public sector social services practice.

Jerry, the goal of working with families in a holistic manner to achieve better outcomes has been around for some time. The change to cross-agency program policy and cross-agency funding streams to support that goal have been somewhat elusive at both the federal and the state levels. Whenever an issue bounces around an industry for so many years and doesn't appear to gain traction, one of two things is usually happening: either, one, the topic is of interest, but there's no real intrinsic value, but the parties sort of enjoy talking about it; or more is happening than we all realize. In your opinion, what's happening here?

Mr. Friedman: Well, I think there's a little bit of both to your question, and we're still kind of defining ourselves in human services in our public policy. Very often we find conflicting things with categorical rules that tend to get in the way of integrated strategies. But again, I tend to be optimistic, partially because of the technology, partially because of welfare reform, and to a great extent through the leadership that's coming through human services that are looking at different and more coordinated strategies. The way that we have partnered with the business community, many states now are actually privatizing casework services, something that just didn't exist before. But they're doing it thoughtfully and rationally and in a way that's devised to get better outcomes. I think that it is still a work in progress, but I think more and more, there is a realization that if we are truly to be investing our human resources wisely, this one-half to one-third of local and state budgets, that we need to have the ability to move beyond all of our individual rules and all of our individual program perspective.

There are huge challenges. First off, if you look at the history of human services, it wasn't like it was formed through some kind of great planning strategy. It seemed like Congress would discover a problem, throw some money at it, and hope that it went away. And the residual effect were all these categorical agencies often competing with each other. They had their own infrastructure. They had their own computer systems. They had their own rules and their own regulations. When you couple that with an advocacy community that's pretty singularly focused, we have advocates around hunger, around developmental disabilities, around mental illness, we don't have advocates for services integration. And yet every one of those programs are adversely affected because there's not a single solution or a single cause of many of these maladies that we have in our society. We've begun to rely a little bit better on technology to get us data and to get us information that tells us where we can invest our resources most effectively.

In the health care arena, there's a lot of work that's going on on electronic medical records. In the course of doing that, I think there's a potential to lay a foundation for further integration of human services in this country. In many areas, there are great demonstrations, but we still as a matter of public policy have not embraced this as the way that we should be doing our thinking and investing.

Ms. Gardner: So in the context, Jerry, of the fact that we're looking at a family as a whole in a holistic way, you mentioned the electronic health record, what are some of the other innovations from a technology perspective that help to break down some of those barriers that exist between the competing organizations and the way that the regulations and the laws have developed?

Mr. Friedman: Well, certainly Internet strategies, looking at ways that people can apply for benefits through the Internet, ways that data can be refreshed, where redundancies can be eliminated, I think have great potential. Many states are developing things like kiosks and automated call centers where they can call in and see whether they're eligible. They can do tests, they can do income tests. All of that is still evolving and still growing, but I think is becoming more and more the industry norm.

There are tools that caseworkers are using that I think are pretty exciting that afford not only greater efficiency, but also greater protections. The state of Alabama has just equipped their child welfare workers with electronic notebooks that do amazing things. Caseworkers can do case notes, they can take photos. They can take photos of children that may have scars and abuses that they can forward to their supervisor to say do we go further with this case? They have GPS so that they know where they're at. They can have a level of safety the caseworkers didn't have before.

Also, you know, for many of the challenges that our clients face, technology is a level playing field. When I was working in Austin, Texas, we had a special project where we refurbished computers. We worked with many of the large computer firms, and we provided these to low-income families that otherwise would not be able to have a computer, and it was just amazing to see what children can do when they're set free in this learning environment through the Internet. Again, it's kind of optimistic. I personally am just still learning how to figure out e-mail, but I've got staff that just do amazing things with computers, and they're always trying to educate me.

There also are ways, I think, that we're being able to process information differently. With the old legacy systems and COBOL language and the way that we had to program, literally taking large business applications and trying to retrofit through different algorithms our human services business, often those things got lost in translation. You know, with decision trees and artificial intelligence and more agile and nimble applications, the potential is there. Looking at outcomes, there are a number of different outcome result systems that are being grown by small companies that are approaching human services, and so I think there's vast potential there.

Ms. Gardner: So any time there's an infusion of technology into an environment that has previously not been able to really do much with it, there are usually barriers and challenges that pop up. So what are some of the big challenges to really taking advantage of emerging technologies in your field?

Mr. Friedman: Well, the biggest one for me, and it's kind of a pet rant, is the process that the federal government has for procuring computer equipment. It's called the APD or the advance planning document process. This is a bureaucratic nightmare that's 40 years old, no longer necessary in my estimation. It was created at a time when I think it was appropriate, when computers and computer applications were relatively exotic, they were relatively new. And the federal government was saying, well, listen, why invest in all of these things? Let's look at have some kind of uniform process and see how we can transfer information back and forth. Also to provide a level of fairness in the competitive bid process.

Well, states now have very robust procurement requirements, every bit as robust as anything that the federal government could do. It stalls the procurement of computer equipment. Because it involves, in many instances, multiple federal agencies, each one can trump the other one in terms of the process. It can take two to three years to get approvals. And in some cases, it's just simply the criteria that they have doesn't make sense. I'll give you one example.

There's a dollar limit that if you exceed -- I think it's $5 million; the dollar amount may have changed because I don't do this every day, but it used to be $5 million -- you had to seek the approval of the federal government. Well, I was in Texas, and I was responsible for a 15,000-person workforce. For me to just routinely replace desktop computers after the depreciation life is gone, I had to go and get approval to do that. Now, ironically, if I wanted to hire 100,000 staff, all I had to do was to put in a state plan amendment. Years ago, the Department of Labor did away with this same process because they realized that it was just antiquated. And I think in many ways, by the time they get the approval, the technology's obsolete.

This is something that we have been striving for for at least the past 15 years, to have this reformed or ended or changed. And I think it's just -- you know, if there's anything that the next administration can do to make life easier for state human services administrators, and especially their chief information officers, it's to absolutely reform this system and to have confidence that states make good, thoughtful business decisions about procuring computer equipment.

Ms. Gardner: So let's talk about something that your organization has been working on specifically, something called the "Organizational Effectiveness Institute, Building the 21st Century Workforce." You started this last May, so can you tell us a little bit about this effort? What was it aimed at and what's happening with it?

Mr. Friedman: We have a training/research/consulting practice at APHSA. In many ways, we needed to be clear about our core competencies and to match that with our members' needs. You know, there are dozens of very, very good consulting firms that do training and consulting in this country. We think that we have a unique niche in that we really understand the business of human services. So we began to do a whole series of evaluation of our own programs, asking our members what their needs were. And essentially they're saying that we need help in looking at organizational effectiveness and then developing good leaders.

And the other thing that has always troubled me as a consumer of consulting services and training was that very often we go to a training program and something nice happens, we put it on a shelf, and we get back and our desk is piled high and we kind of forget what we learned through that session. So we're very much into looking at actual products, being able to take something away from this experience. And so we created this concept of having an institute where our members, our states, and in some cases local organizations, would participate not for a one-shot training session, but through a process that would lead to a product.

Now, the workforce institute was particularly interesting because when we meet with our CEOs and we ask them what are your greatest needs, the issue of staff recruitment, retention, early retirements, building a bench for new leadership, I mean, many of my colleagues are my age, you know, baby boomers that are of retirement age, and we stand to lose a significant amount of institutional knowledge as well as leadership if we don't find some way to address that. Well, what we learned through our needs assessment was that very often human resources personnel offices weren't necessarily being seen as a solution, that personnel rules weren't seen as an asset that can help enable addressing that issue.

And so what we did was that we created this institute, and it lasted for a year. There were four group meetings of all of the participants, but then there was a lot of individual consulting and peer consulting, which was very important, that happened in between those meetings. And the end result was that the human resources directors walked away with a product which was a workforce plan that they could take to their governor's office. We actually field tested this by bringing in a number of retired commissioners, secretaries, and directors of human services and saying to them basically if your human resources director submitted this plan to you, is this something that you would support?

And so the end result of this one year was an actual working workforce plan that drilled down beyond, you know, I need 20 caseworkers because my caseloads are going to get this high, but looking at skill sets. Where do you find them? How do you work with the universities? How do you work with the training centers? How do you help grow internally your own training capacity to have this happen? What kind of array of benefits and training opportunities do we create for our workforce? How do we embed quality improvement in the way that we do business? And so it was beyond just how you do a workforce plan. It was how you actually make a more effective organization.

Mr. Morales: So Jerry, along these lines, to be a bit more specific, what are some of the workforce capacity building challenges faced by public human service agencies, and how does the institute seek to assist participants in strengthening agencies' workforces and human resource capacities?

Mr. Friedman: Well, what we're trying to do is to embed a strategic process in looking at our workforce needs. And that, I think, has been a missing element. I think we've done traditional recruiting and we've gotten people that have credentials. But when we look at the broader strategy of who's coming into human services today and making it a career, quite frankly, I'm a little troubled.

I'm at the tail-end of my career. I'm in my sixties. I was a product of the 1960s and the 1950s, and I was drawn to public service. It wasn't part of my family tradition. I was drawn to public service by the leadership of this country who talked about human services and public service being an honorable thing that should attract the best and the brightest. You know, we had leaders in this country who were great role models, and it troubles me today that we don't kind of have that sense of government as being such an instrument of good. Not to be critical, but when you turn on the radio programs around the country, all you hear is that government wastes this and government does that. I really take exception to that.

I have worked both in corporate America and I have worked in the public sector, and there are challenges in both and there is competence in both, and unfortunately, there's incompetence sometimes in both. But the public business is a little bit unique because it is in the open. And so I think all of that has created an environment where people just aren't as attracted to public service as they used to be. And so what we're trying to do is to rebuild that through reshaping our public image, getting back to the notion that human services is honorable.

We have always known, those of us who got into this, we didn't get into human services for the money. If we did, we made a very dumb decision. We were driven by a different kind of mission, a desire to make a difference in a different kind of way and contribute in a different way. You know, that spirit I think is something that we want to kind of recapture.

Mr. Morales: What about the future of public human services delivery?

We will ask Jerry Friedman, executive director of the American Public Human Services Association, to share with us when the conversation about management continues on The Business of Government Hour.

(Intermission)

Mr. Morales: Welcome back to The Business of Government Hour. I'm your host, Albert Morales, and this morning's conversation is with Jerry Friedman, executive director of the American Public Human Services Association. Also joining us in our conversation from IBM is Nicole Gardner.

Jerry, perhaps you could elaborate on the types of public-private partnerships that your members and affiliates engage in to improve operations or outcomes. And in what areas do you think you would like to enhance or expand these types of collaborations?

Mr. Friedman: Well, that's a very good question. In reality, there has always been, I think, a level of partnership between at least public human services and the private sector. Many of the actual services are provided under contract. Many of the charitable faith-based organizations have been dealing with people with needs, material needs, basic needs, other human services needs for years. So when you look at the array of vast human services networks that are out there, very often, the majority of the programs are actually provided within the private sector. However, recently, there has been more and more of a movement towards privatizing some of the core functions that had traditionally been part of government.

I think what we try to do best as a national association is to work with our members to make sure that they have weighed all of the factors they could consider into whether this is a good decision or not. I think the issue isn't the whos. It's more the issue of the whats, and being clear about what the core competencies are. If government entities are going to be contracting, then I think they need different skill sets, or need to emphasize skill sets a little differently. And I think we have a good example.

Twenty years ago, states ran huge data centers with state employees. In many areas, these are now run by corporate America under contract. What happened, though, in the state information technology world was that the core competencies changed. They changed to project management, contract management, automation planning, quality control. And I think the same needs to happen as we start to look at actual service delivery. But if we're going to be farming these activities out to for-profit or not-for-profit organizations, we need to be real clear about what the expectations are: managing those contracts and those projects effectively. And so I think that's the critical issue. It's not who's doing it, it's what's being done, and is it done with the eye of actually providing an improved service delivery system rather than because it seems to be the local trend.

Mr. Morales: So Jerry, obviously you just opened the door for a discussion on the future. What do you see as some of the emerging trends in social welfare policy over, say, the next 5, 6, 7, 10 years?

Mr. Friedman: Well, I think we're at a very exciting time. Again, I think the lessons that were learned from welfare reform, the demonstration that state and local governments really can manage programs effectively, is continuing to evolve and continuing to grow.

I see a number of different trends. I think the movement towards services integration clearly is happening in a lot of different areas. I think categorical agencies are beginning to realize that it takes a holistic approach in order to address the needs of families. I think more and more, state and local governments are looking how to return on investment. You know, is this the best result that we can get for the amount of money that we are investing? And I think it kind of goes beyond just looking at a program from a cost perspective. I think we need to look at it from an outcome perspective.

The continued advancement in technology throughout the entire human services system, from consumers to clients to the way that we process mega data in this country, I think is continuing to evolve. And what I see happening is that major corporations are now investing specifically in human services applications rather than retrofitting business applications to human services.

I think that there's going to be a continued movement towards consumerism. You know, there should be nothing about me without me. More and more clients are saying and progressive human services professionals are saying I need to involve a client in this decision in order to have the best outcome. And so there is more of a kind of openness and a willingness to do this.

And I think in many ways it could also be a cost driver, particularly in the health care arena. We need to have the costs of what it takes in medical care to be transparent. We need to know what they are. Consumerism can do a great deal to drive down costs. I heard Speaker Newt Gingrich talk about the airline industry, and he was talking about the combination of deregulation and the Internet and things like Expedia and Priceline and all those different things have driven down the cost of air miles from 29 cents a mile down to 10. It's just a stunning thing what competition can do and we need to start having that application in human services. I think continued partnerships and having strategic approaches and better use of data will continue to be a part of it.

And obviously volunteerism. We need to rely on a community not only for the services that they provide, but for the engagement. My experience is that when people become exposed to what happens in a human services agency or in a human services program or even in an institution, they become advocates for it when they begin to see what it's like. So I think that those are some of the major trends. I think the bottom line, though, to all of these things is what it has always been, and that's we have to keep the clients first. We can't lose sight of our purpose and our reason for being in the human services business in the first place. And that's because people that are at our desks are there with multitude of problems. They're in pain, they're in need. And so we can set up these elaborate systems, but we can't lose our heart. And I think that that's a lesson that's always with us, and to always acknowledge the awesome responsibility that we have in human services.

I used to tell my co-workers you know that a keystroke on a computer can make the critical difference as to whether a child goes to bed hungry or nourished, and that's just an awesome responsibility that plays out a million times a day in this country, and we don't take credit for it. We don't talk about how often the systems work. We focus in on the failures rather than our successes. And if we're going to really change the human services industry and have it grow and thrive as a viable part of our society, we need to change the public image. We need to be able to tell that story better.

Ms. Gardner: So continuing our theme of looking into the future, Jerry, from a policy perspective on some of the specific programs, you know, what's coming up for Medicaid, for TANF, for child welfare? What's going to happen over the next year or two?

Mr. Friedman: Well, I wish I had a crystal ball that I could say that, because we're caught in competing dynamics. You know, I think that there's a growing awareness among people who pay taxes that they want to see a return on their investment. And I think there's also a real acknowledgement that people do have human needs, and I think we're going to continue to strive for that perfect balance. But again, you know, I keep going back to the lessons that we learned through welfare reform about personal responsibility, about work opportunities, about empowering communities to make a difference. I think that those will continue to grow.

The health care area I think is fascinating because we really are, I think, in the early stages of a transformation. I see it happening again with the Medicaid directors in this country and the role that they're playing and looking at prevention and wellness programs, and I think that that'll continue to be a part of it.

I know the direction I would like to see Congress in the next administration go, and that again is always to empower states, to give them flexibility, to have administrative simplicity, to keep client needs at the forefront. And I think if we do that, we can continue to have a stronger society.

Again, the return on investment I think is really important. We as a human services industry need to talk about the return on investment that society does get. You know, when we think about the food stamp program, we don't think about what it infuses into an economy. It's not just that the people who are low wage are able to have better nutrition, but what does it mean for the grocers and the growers and those that transport food and how it contributes to a stronger society?

Think of a society without human services, what kind of world we would have. And so we're getting a little better at telling our story. And I truly appreciate the opportunity to be on a show like this to talk to your listeners and to tell the human services story, to share our challenges as well as some of the opportunities. And I'm just very, very grateful for this experience.

Ms. Gardner: Well, we're honored to have you. In the context of the story you just told about the profound good that can be done, children being nourished, families being helped, if you were to get your aspiration realized that Congress would be proactive and positive in its treatment of human services policy and legislation going forward, how would you challenge your members to then take those things and move forward to really meet the challenge of improving service delivery and living up to the picture that you've painted so articulately?

Mr. Friedman: Well, I think two things: to think holistically, how the various parts fit together to a system of care; and secondly, keep the clients first, keep the needs of the children in this country and the families who are struggling in this country. Unfortunately, I can walk out of this nice building in downtown Washington, D.C., and before I hit the next corner, I will be able to see the failures of our society, where people who have been left out and left behind, the homeless population, who aren't afforded, for whatever reasons, the opportunity to participate in the wealth of this great country. You know, we'll always have our work to do. So those are the things, the messages that I would give.

Mr. Morales: Jerry, it's hard not to be moved by your passion and dedication to public human services, so I'm curious, what advice could you give to someone out there who perhaps is thinking about starting a career in public service and perhaps in particular interested in working in the area of public human services?

Mr. Friedman: Well, I think that the best experience really is hands-on. I always encourage people to volunteer, to spend time in public facilities, nursing homes, to talk to people who have needs to see where their strengths and where they can contribute. I think that that's the greatest thing is through the exposure. You know, we appreciate all of the courses in social work and public policy that happen, but I think it's that hands-on experience, that personal passion that somebody can have, and the exhilaration of actually seeing somebody who has improved the quality of their lives because you've been there, because you've been working with them, because you've tutored somebody who was illiterate and now they're job-ready. I mean, I just can't tell you. It's like maybe the equivalent, the public human services equivalent, of hitting a grand-slam home run in a World Series.

One of the greatest things that I get to do sometimes is to go to graduation classes of public welfare agencies, where they've taken people who had not been job-ready and they're out and they're ready to join the workforce or perhaps they're already working, to see the transformation in their lives. They have a client come back to them and say thank you, you made a difference.

Just one quick story. When I was a probation officer, I had a huge caseload. I didn't always I mean, you had to kind of triage. And years after I had left this job, I received a call one night at my house and it was from a man and I could tell he was obviously very emotional. And he asked if I was the probation officer that had his case, you know, 5, 10 years earlier. And I had to really search my memory banks, and indeed, it was and I did remember that. And what he wanted to tell me was that he was in the hospital, his wife had just given birth to his first child, a son, and that he wanted me to know I was the second call that he made -- the first was to his parents -- that he would not have had that thrilling opportunity to be a parent had I not intervened in his life in an early stage when he was struggling with substance abuse. Now, I barely remembered the case and I didn't do great casework. I gave him a choice: you're going to rehab or you go to jail, you know. But obviously it made an impact on this person. I hadn't thought of that case in years, but to get that phone call is something that just stayed with me for the rest of my life.

We don't always know that we make a difference. And so that's what I would tell people, that if they want a career where they can have those kind of rewards and benefits, then human services is a place that they ought to look.

Mr. Morales: That's absolutely wonderful. Jerry, unfortunately, we have reached the end of our time. I want to thank you for fitting us into your busy schedule. But more importantly, Nicole and I would like to thank you for your dedicated service across the many years and roles that you've had in the area of public human services.

Mr. Friedman: Thank you very much. I appreciate it. If people want to find more about the American Public Human Services Association I urge them to take a look at our website. It has up-to-date information on all of the legislative proposals that are happening in Congress. It's a wealth of information, and it's at www.aphsa.org.

Mr. Morales: Great, thank you. This has been The Business of Government Hour, featuring a conversation with Jerry Friedman, executive director of the American Public Human Services Association.

My co-host has been Nicole Gardner, vice president and partner in IBM's public sector social services practice.

As you enjoy the rest of your day, please take time to remember the men and women of our armed and civil services abroad who can't hear this morning's show on how we're improving their government, but who deserve our unconditional respect and support.

For The Business of Government Hour, I'm Albert Morales. Thank you for listening.

Announcer: This has been The Business of Government Hour. Be sure to join us every Saturday at 9:00 a.m., and visit us on the web at businessofgovernment.org. There, you can learn more about our programs and get a transcript of today's conversation.

Until next week, it's businessofgovernment.org.

Originally Broadcast December 8, 2007

Washington, D.C.

Welcome to The Business of Government Hour, a conversation about management with a government executive who is changing the way government does business. The Business of Government Hour is produced by The IBM Center for The Business of Government, which was created in 1998 to encourage discussion and research into new approaches to improving government effectiveness. You can find out more about The Center by visiting us on the web at businessofgovernment.org.

And now, The Business of Government Hour.

Mr. Morales: Good morning. I'm Albert Morales, your host, and managing partner of The IBM Center for The Business of Government.

In many respects, we are a nation at a crossroads. In the delivery of critical human service programs, policymakers and managers must consider issues such as fundamental reform, funding and financing, and program flexibility to focus on outcome measures and not just the process. In the end, the success of human service programs is measured by the health and well-being of this country's citizens.

As part of a series of discussions on managing human service programs, we have broadened our reach in this space and are honored to welcome our special guest this morning, Jerry Friedman, executive director of the American Public Human Services Association.

Good morning, Jerry.

Mr. Friedman: Good morning, Albert. It's a real pleasure to be here.

Mr. Morales: Also joining us in our conversation is Nicole Gardner, vice president and partner in IBM's public sector social services practice.

Good morning, Nicole.

Ms. Gardner: Good morning, Al. Good morning, Jerry.

Mr. Friedman: Good morning.

Mr. Morales: Jerry, let's start off by learning a bit more about your organization. Perhaps you can give us an overview of the mission, the history, and the activities of the American Public Human Services Association.

Mr. Friedman: Well, thank you for the opportunity to be here this morning. We always look forward to venues in the public arena where we can talk about human services. The American Public Human Services Association is a 77-year-old organization that started around the same time as the Social Security Act. It was really founded by a group of very visionary administrators who were concerned about what back then they called the distribution of relief. They wanted to have a voice in policy in Washington, D.C., and they wanted to look at best practice. And essentially, that is what our organization has stood for for the past 77 years.

We've undergone several changes. We used to be called the American Public Welfare Association, focusing in on those types of programs. But we've actually broadened our horizon, recognizing that there is a realm of human service programs that need the kind of attention that a national association can give it.

Essentially, our mission is strengthening America through excellence in public human services. I think a lot of people don't realize just how large human services is, and the presence that it has in our society. We are generally one-third to one-half of most state and local budgets, and consequently, we have a large business to run and an obligation to run it effectively. But it also is a compassionate business, so we have kind of this desire to make sure that we're maximizing our resources, but doing it in a kind and compassionate way.

Basically, our association does three things. We work for good public policy. Good public policy meaning that there are adequate resources, that there's flexibility to run the programs, that we can actually look at outcomes and invest in clients rather than in the bureaucracy.

We then work with our members to help them implement that policy in the correct way. We do this through training and research and consulting.

And then the final area that we do is we really work on our public image. I think we can be successful mainly to the extent that the public has confidence in our ability to manage our programs efficiently and effectively. And we do that through radio shows, we do that through our website, through our magazines, publications, newsletters, informing the public as well as the profession is a key component of APHSA.

Mr. Morales: Could you give us a sense then of the scale of the operations at your organization and its affiliates? Can you tell us a little bit about who are some of its members and the size perhaps of your budget and the number of employees?

Mr. Friedman: Sure. In many ways, we serve like the National Governors Association does for governors. We perform the same function for the governors' appointed heads of health and human services programs, the state CEOs.

Our core group really are the states. And I've been very pleased that for the past four years, every state and a number of the territories have been full members of APHSA. That's very important to us, because when we go to Congress and we go to testify to say that we represent states, we truly do. Every state is a member.

We then have several hundred local members, counties, areas as large as New York City and Los Angeles to Tioga County, Pennsylvania, that likes to pride itself in being an area that doesn't have any traffic lights or parking meters, so we have that range. And then we have several thousand individual members.

We're a moderate-sized association. We rely a lot on our membership to provide the kind of support to enhance the field of human services. We have approximately 50 employees; sometimes there are more when we get special grants and projects. And we have an operating budget of around $5 million.

Ms. Gardner: So Jerry, now we understand a little bit more about APHSA. You're the executive director. Can you tell us what you do in your job? What does it entail?

Mr. Friedman: I would say that there are probably three major activities that I'm involved in. The first really is association management. We're unique, I think, in that we have to be very sensitive to the fact that our members operate public entities. We treat every dollar that comes into APHSA as if it was a tax dollar, because in many instances, it is. And so we've very sensitive to making sure that we provide the kind of return on the dollar. So just running the association, our own computer systems, our own budgeting processes, our own personnel, occupies a portion of my time.

Probably the largest portion of it is involving member services: meeting with our members, trying to get a sense of areas that they need us to focus in on; sharing best practice.

And then, of course, there's the work that we do on Capitol Hill and with the administration as well as other associations, partnering with them in trying to obtain good policy, good effective resources in the work that we do in Washington, D.C.

Ms. Gardner: In the context of all that, what are maybe the top three challenges that you face? And what kind of things are you doing to address those challenges?

Mr. Friedman: We certainly have the vast array of human services challenges that all of our members face. Internally, you know, we also have challenges in managing during difficult economic times. When states have downturns, when the revenues decline, that also affects our revenues, so that we've had -- from time to time, had to manage during difficult times.

Staff retention is a big issue for us. We're very fortunate in that being in business for so long and having a reputation, which I think is excellent in this city, we're able to attract very, very talented individuals. They gain national exposure. They get to meet with every state CEO. They get to meet with members of Congress. They get to hang out with other associations. And very often, they get recruited because they are talented. So we probably have a higher -- just by circumstances, a higher ratio of turnover than many other organizations.

And, you know, one of the difficult things for me is that most of our core membership is appointed by governors. When their terms expire, they move on to different things. And we develop these relationships, and it's very difficult sometimes to deal with a lot of turnover within the states.

But I think the main challenge in human services, and I think it's also true for our association and all of its components, is truly our public image. The ability to tell our story not only just in Congress, but to the general public I think is critical. We face very unique challenges in human services. We're one of the few industries that is literally working to put itself out of business. We strive for a better society. We strive to alleviate poverty. We strive to eliminate child abuse. And if we're truly successful, there wouldn't be a need for us.

On the other hand, our failures are very visible. We can be successful in dealing with thousands of children. And when we have that unfortunate situation where a child gets lost, of course the public rightfully is outraged as we are, and that draws attention to us. We conduct our business in the open. We're the American Public Human Services Association, and that means if we make a mistake, you're going to read about in the front pages of the newspaper. And often, corporate America and the business community and even the other nonprofit organizations don't have that kind of exposure. So we have unique problems, but we also have unique opportunities, and I think all of this makes us stronger.

Mr. Morales: So Jerry, with that type of a mission, I'm curious, how did you get started in this field? What prompted you to get into this?

Mr. Friedman: Well, I was very fortunate in that I started my career as a probation officer. That may sound like a very strange answer, but when you think about it, what a probation officer does, there's a law enforcement aspect to it, but then on the other hand, there's kind of a case management function. You know, when somebody's coming out of prison, they need a job, they need housing, they need treatment, they may be addicted to drugs and alcohol and you have to work with that. And what I learned from that experience was that very often, the human services system broke down for people, and it was mainly because of the way that we were structured within a categorical system. And that really shaped a lot of my early thinking about how we could provide services in a different way, how we could have a more coordinated strategy for dealing with the multiple problems that people were facing. And so I had this exposure to the broad array of human services through that experience.

I then was fortunate enough to kind of have a career progression that led me to be a county human services administrator in two different counties in Pennsylvania. And then I became a state director of public welfare in Pennsylvania. Later, in Washington state, I was in charge of the Economic Services Administration. And before my job at APHSA, I was the executive deputy commissioner for the Texas Department of Human Services.

What that gave me, I think, was good, practical experience in actually providing the services at the county level, but then having the state experience. And through that, I touched various systems, everything from health care to child welfare to mental health, drug and alcohol programs. And so when the association was recruiting for a new executive director, I think that they wanted somebody with both state and local experience, and having that kind of broader perspective of having administered a wide array of programs.

Mr. Morales: So as you reflect back on your career, is there one aspect of that that you feel has really shaped your current leadership role and perhaps informed your current style?

Mr. Friedman: Albert, the one asset that I think that I bring to APHSA is a 25-year history of being a member. This association was my safety net. When I absolutely needed information and needed it quickly, I had them on my speed dial. When we had public policy that we needed changed -- I can give you a very good example -- and that was with welfare reform when there was a provision that legal immigrants were not entitled to food stamps. Our state legislature and our governor, I was in Washington state at the time, said this is unacceptable, find a way to make a change. It was APHSA, our association, that led the change in Congress that allowed states to purchase food stamp coupons for this population. So I came in with a great deal of passion about the association and the work that the association does as a consumer and as a member.

So what I bring to the association is I have such talented co-workers, oh, they're working on their Ph.D.s and their law degrees and they're just extraordinary, but I can look at something that crossed my desk and say if I was a member, would this make sense to me? And so as long as I think I can keep that member perspective, I'll be able to enrich the association to some degree.

Mr. Morales: That's fantastic.

What are some of the lessons learned from welfare reform efforts? We will ask Jerry Friedman, executive director of the American Public Human Services Association, to share with us when the conversation about management continues on The Business of Government Hour.

(Intermission)

Mr. Morales: Welcome back to The Business of Government Hour. I'm your host, Albert Morales, and this morning's conversation is with Jerry Friedman, executive director of the American Public Human Services Association.

Also joining us in our conversation from IBM is Nicole Gardner.

Jerry, we've used the term "public human services." Can you elaborate exactly what that means?

Mr. Friedman: Well, there's a debate actually on what public human services are. At one point, it was human services that were provided by government employees, but I think that that's changed a great deal with privatization efforts, with partnerships, with contracting. So now we define it more as services provided under the public aegis, where government dollars are used and there's a level of accountability, but it could be provided by a number of different associations, organizations, companies, both private and not-for-profit.

Mr. Morales: Let me go back in time a little bit. In the 1990s, government had made a statement to end welfare as we know it back then, which launched a series of welfare reform initiatives. Could you remind us of some of the key elements of this welfare reform, and from your perspective, how significant a social policy change does this welfare reform effort represent?

Mr. Friedman: If I look back on events that happened in my career, I think welfare reform was probably the most significant change in social policy in my lifetime. And what it did basically was that it ended individual entitlements for people and gave states block grants with considerable flexibility for states and local governments to design programs that made sense to them. Included were some provisions, like time limits, lifetime time limits, work requirements, just a vast array of significant changes to the way that we looked at what had been a dependency program to one that became a program of self-sufficiency.

In many ways, I think some of the lessons that were learned through welfare reform are really beginning to permeate some of the other human services systems as well. But all in all, I think welfare could be considered a successful program in the United States that brought about significant change.

Ms. Gardner: So Jerry, in that context, tell us a little bit about some of the key lessons we learned in welfare reform.

Mr. Friedman: Well, first, if I could just talk a little bit about some of the successes. And you have to realize that the AFDC program had been in existence for many, many years. It was a well-entrenched program basically operated through federal rules. And so when the new law came into effect and states were empowered to develop their own and design their own programs, there was a great deal of both apprehension as well as a great deal of high expectations for welfare administrators who had really wanted to do something different with the program for a considerable period of time.

It's important to note that welfare reform didn't actually start with the new law. There were over 40 states who had gone to the federal government to seek waivers to say we think that we have a better solution to helping people become self-sufficient. And what the federal legislation really was were some of those common threads through all of those various waiver programs.

But when you look at what happened over the course of a decade, there was a 60 percent decline in welfare caseloads in this country. Child support collections for non-custodial parents doubled. Over 1.5 million welfare recipients who had previously never been attached to the workforce had gainful employment and were no longer reliant on the public welfare system to support them. We implemented a national electronic benefits transfer program, a large computerized effort that actually eliminated food stamp coupons in this country. We created hundreds of thousands of child care slots. We invested in prevention programs that resulted in a decline in teen pregnancy among welfare mothers of one-third. And for the first time, reversing a two-decade trend, we actually had a decline in child poverty rates in this country. So by all accounts, you would consider that a success.

Well, there were many lessons to be learned through that. First, there was a really compelling case for change. Welfare dependency was a bad investment strategy, basically supporting somebody. It didn't help grow our society or our economy or the self-image of those who were receiving those benefits. So that we learned that there was kind of both an economic and a moral imperative for change. Yes, indeed, we are a compassionate society. We are our brother's keeper. But on the other hand, we had an obligation to help people maximize their own personal potential and develop their own capacity.

We learned that personal responsibility can be very effective public policy; that in life, there is a quid pro quo; that reciprocity is just the way that we live as Americans, and that its public policy should reflect that. We learned that people can rise to the occasion, that when they were afforded the opportunity, people became job-ready. They invested when there were both incentives positive and negative. People reacted in that they did want better things for their families. We learned, I think, that the best service delivery was designed at the local level. Welfare reform was not a national strategy. It was saying here's the money, here are the resources, develop a local strategy, and that resulted in those successful efforts.

We learned that we had to rely on partnerships, that welfare in this country couldn't be fixed by government. It required corporate America, the business community, the nonprofit world, the faith-based world, education, all coming together in kind of a uniform strategy to help address this. We learned the importance of services coordination and integrating services. What happened with lifetime time limits was that the bar was raised. We had a finite period of time to have people become job-ready or they would lose this safety net. We know that people don't come to welfare offices simply because they have empty wallets and empty pocketbooks, that there's often just a myriad of other problems that exist, and that we needed to address those. And that required the agencies that provided those services to get together in some kind of coordinated strategy. We also learned that there were other multiple strategies that we needed to look at: asset building, predatory lending. You know, there's a whole industry that thrives just because people are living in poverty.

I think the most important lesson, though, was, you know, for years people railed about the public welfare system, and I was one of them, to be honest with you, that it was a failed system. Well, what we learned was it was failed policy. When people are penalized, when their family condition or economic conditions are worse off because they're trying to better themselves and become employed, when they actually lose money, when the most responsible thing that they can do financially for their family is to stay on welfare rather than try to get to work because they'll be worse off, that's failed policy.

When that changed, we demonstrated it was not a failed workforce. The welfare system, this huge entity in this country, literally turned on a dime. Welfare offices almost overnight were transformed from "welfare offices" to "work centers." You know, the message was clear: What can I do to help you get a job today? This magnificent welfare workforce absolutely transformed themselves because they wanted to. They saw firsthand every day how just handing somebody a check and food stamps and hoping that every problem went away was foolish policy. And when that changed and they could make a real difference, they really rose to the occasion.

Ms. Gardner: That's quite a story. So you mentioned a few minutes ago reauthorization. So where are we with the reauthorization of TANF, and kind of what's the status? Where are we going?

Mr. Friedman: TANF was reauthorized after about 12 or 13 continuing resolutions. We just couldn't seem to get congressional attention because of all of the other priorities. And at the very end of the legislative session last year, as part of the Deficit Reduction Act, TANF reauthorization was passed. As an association, we are very concerned about the kind of micromanagement that's been built back into the welfare system. We think that the broad strategy of providing goals for states to reach, and empowering communities to reach those, worked. Clearly demonstrated that. And so we're concerned that we've taken a huge step backwards when it comes to welfare reform. And administrators, rather than talking about how can we get people into gainful employment, how can we help them get better jobs, how can we improve their economic conditions, they're talking about how we can have something count as a work participation credit because of the penalties that they're going to be facing. We're working very hard to minimize any damage as we see it to this program. To continue to empower states, we strive for maximum flexibility, but we're going to have an uphill battle.

Mr. Morales: Now, Jerry, you mentioned earlier that welfare reform really began at the state and local level. And I believe today, we again are seeing state agencies developing innovative public policy agendas to shape the next decade of service to low-income families. Could you elaborate on some of these innovative state programs? What are some of the strengths that you're seeing in some of these programs?

Mr. Friedman: Well, again, I think drawing off some of the success that we had with welfare reform and just looking at public policy that empowers communities, we're seeing this play out in child welfare programs, we're seeing this played out in health care programs. If you went to a Medicaid director 20 years ago and you said what is your job, they would say my job is to pay bills timely, accurately, and efficiently, and basically they did that. If you ask a Medicaid director today what is your job, well, they're part of a governor's health cabinet. They're looking at universal coverage. They're looking at strategies to cover the uninsured. They are looking beyond just paying bills to what are the best treatments and interventions that we can provide? Where do we get a return on the investment? How can we engage consumers? Now can we embrace prevention and wellness programs?

It's an exciting time right now because of a lot of flexibility that's been given to states around health care design. And I would contend that the real leadership for this is not happening within the confines of Washington, D.C., but it's happening in the statehouses throughout the country.

I think the same is true with public child welfare. Welfare administrators are saying, you know, if I could take the resources that it takes to buy foster care and invest in strategies to build stronger families in the beginning, investing in prevention, investing in interventions that help people become better parents up front, then we could save all this money on the back end. But more importantly, children thrive better in families than they do in foster care. It's more than intuitive. It's supported by all the research and by all the evaluations that happen. So what I see happening now are administrators throughout this country, states approaching the federal government just like they did with welfare reform, saying we think we have a better solution based on our local conditions, by the assets and the resources within our community, and our ability to mobilize them.

The other thing that we didn't have 25 years ago, when I was running programs, is we have more supportive technology. It used to be very hard to keep track of all of the records that you needed and the requirements and the rules and regulations when you had six or seven or eight different categorical programs with rules and different requirements. But with computer systems now and the ability to process information, it is much easier, I think, to manage those programs within the compliance rules of the federal government.

Mr. Morales: So Jerry, it sounds like, you know, really workforce strategies are really sort of the key to success here in helping families manage this transition that you describe. But can you give us perhaps some specific examples of programs that are out there that you think are really innovative and are working well?

Mr. Friedman: Well, there are thousands of them. And I think, again, the key was that public administrators were set free to go out and to develop strategies that worked.

You know, one of the things that we used to do, I used to do this when I ran welfare programs, was to go to corporate America and to business and say wouldn't it be nice if you hired somebody off the welfare rolls? You know, it helps the community and it's the right thing to do. Now we can go to corporate America and the business community and say we can help you build your business. We can help your bottom line. We can help your profit. We can do that through tax credits. We can do that through customized job training. We can do that through extended medical assistance coverage and child care subsidies. We can do that through working with new employees to help train them through orientation. So people see this as a better business strategy than they used to as just a social service.

Mr. Morales: So it's about collaboration.

Mr. Friedman: It's about collaboration. It's about partnership. But it's also -- it's about investment. Good public policy, good social policy, good human services policy and making profit don't have to be mutually exclusive principles.

Mr. Morales: That's a very good point.

What emerging technologies hold the most promise for improving human services delivery? We will ask Jerry Friedman, executive director of the American Public Human Services Association, to share with us when the conversation about management continues on The Business of Government Hour.

(Intermission)

Mr. Morales: Welcome back to The Business of Government Hour. I'm your host, Albert Morales, and this morning's conversation is with Jerry Friedman, executive director of the American Public Human Services Association. Also joining us in our conversation is Nicole Gardner, vice president and partner in IBM's public sector social services practice.

Jerry, the goal of working with families in a holistic manner to achieve better outcomes has been around for some time. The change to cross-agency program policy and cross-agency funding streams to support that goal have been somewhat elusive at both the federal and the state levels. Whenever an issue bounces around an industry for so many years and doesn't appear to gain traction, one of two things is usually happening: either, one, the topic is of interest, but there's no real intrinsic value, but the parties sort of enjoy talking about it; or more is happening than we all realize. In your opinion, what's happening here?

Mr. Friedman: Well, I think there's a little bit of both to your question, and we're still kind of defining ourselves in human services in our public policy. Very often we find conflicting things with categorical rules that tend to get in the way of integrated strategies. But again, I tend to be optimistic, partially because of the technology, partially because of welfare reform, and to a great extent through the leadership that's coming through human services that are looking at different and more coordinated strategies. The way that we have partnered with the business community, many states now are actually privatizing casework services, something that just didn't exist before. But they're doing it thoughtfully and rationally and in a way that's devised to get better outcomes. I think that it is still a work in progress, but I think more and more, there is a realization that if we are truly to be investing our human resources wisely, this one-half to one-third of local and state budgets, that we need to have the ability to move beyond all of our individual rules and all of our individual program perspective.

There are huge challenges. First off, if you look at the history of human services, it wasn't like it was formed through some kind of great planning strategy. It seemed like Congress would discover a problem, throw some money at it, and hope that it went away. And the residual effect were all these categorical agencies often competing with each other. They had their own infrastructure. They had their own computer systems. They had their own rules and their own regulations. When you couple that with an advocacy community that's pretty singularly focused, we have advocates around hunger, around developmental disabilities, around mental illness, we don't have advocates for services integration. And yet every one of those programs are adversely affected because there's not a single solution or a single cause of many of these maladies that we have in our society. We've begun to rely a little bit better on technology to get us data and to get us information that tells us where we can invest our resources most effectively.

In the health care arena, there's a lot of work that's going on on electronic medical records. In the course of doing that, I think there's a potential to lay a foundation for further integration of human services in this country. In many areas, there are great demonstrations, but we still as a matter of public policy have not embraced this as the way that we should be doing our thinking and investing.

Ms. Gardner: So in the context, Jerry, of the fact that we're looking at a family as a whole in a holistic way, you mentioned the electronic health record, what are some of the other innovations from a technology perspective that help to break down some of those barriers that exist between the competing organizations and the way that the regulations and the laws have developed?

Mr. Friedman: Well, certainly Internet strategies, looking at ways that people can apply for benefits through the Internet, ways that data can be refreshed, where redundancies can be eliminated, I think have great potential. Many states are developing things like kiosks and automated call centers where they can call in and see whether they're eligible. They can do tests, they can do income tests. All of that is still evolving and still growing, but I think is becoming more and more the industry norm.

There are tools that caseworkers are using that I think are pretty exciting that afford not only greater efficiency, but also greater protections. The state of Alabama has just equipped their child welfare workers with electronic notebooks that do amazing things. Caseworkers can do case notes, they can take photos. They can take photos of children that may have scars and abuses that they can forward to their supervisor to say do we go further with this case? They have GPS so that they know where they're at. They can have a level of safety the caseworkers didn't have before.

Also, you know, for many of the challenges that our clients face, technology is a level playing field. When I was working in Austin, Texas, we had a special project where we refurbished computers. We worked with many of the large computer firms, and we provided these to low-income families that otherwise would not be able to have a computer, and it was just amazing to see what children can do when they're set free in this learning environment through the Internet. Again, it's kind of optimistic. I personally am just still learning how to figure out e-mail, but I've got staff that just do amazing things with computers, and they're always trying to educate me.

There also are ways, I think, that we're being able to process information differently. With the old legacy systems and COBOL language and the way that we had to program, literally taking large business applications and trying to retrofit through different algorithms our human services business, often those things got lost in translation. You know, with decision trees and artificial intelligence and more agile and nimble applications, the potential is there. Looking at outcomes, there are a number of different outcome result systems that are being grown by small companies that are approaching human services, and so I think there's vast potential there.

Ms. Gardner: So any time there's an infusion of technology into an environment that has previously not been able to really do much with it, there are usually barriers and challenges that pop up. So what are some of the big challenges to really taking advantage of emerging technologies in your field?

Mr. Friedman: Well, the biggest one for me, and it's kind of a pet rant, is the process that the federal government has for procuring computer equipment. It's called the APD or the advance planning document process. This is a bureaucratic nightmare that's 40 years old, no longer necessary in my estimation. It was created at a time when I think it was appropriate, when computers and computer applications were relatively exotic, they were relatively new. And the federal government was saying, well, listen, why invest in all of these things? Let's look at have some kind of uniform process and see how we can transfer information back and forth. Also to provide a level of fairness in the competitive bid process.

Well, states now have very robust procurement requirements, every bit as robust as anything that the federal government could do. It stalls the procurement of computer equipment. Because it involves, in many instances, multiple federal agencies, each one can trump the other one in terms of the process. It can take two to three years to get approvals. And in some cases, it's just simply the criteria that they have doesn't make sense. I'll give you one example.

There's a dollar limit that if you exceed -- I think it's $5 million; the dollar amount may have changed because I don't do this every day, but it used to be $5 million -- you had to seek the approval of the federal government. Well, I was in Texas, and I was responsible for a 15,000-person workforce. For me to just routinely replace desktop computers after the depreciation life is gone, I had to go and get approval to do that. Now, ironically, if I wanted to hire 100,000 staff, all I had to do was to put in a state plan amendment. Years ago, the Department of Labor did away with this same process because they realized that it was just antiquated. And I think in many ways, by the time they get the approval, the technology's obsolete.

This is something that we have been striving for for at least the past 15 years, to have this reformed or ended or changed. And I think it's just -- you know, if there's anything that the next administration can do to make life easier for state human services administrators, and especially their chief information officers, it's to absolutely reform this system and to have confidence that states make good, thoughtful business decisions about procuring computer equipment.

Ms. Gardner: So let's talk about something that your organization has been working on specifically, something called the "Organizational Effectiveness Institute, Building the 21st Century Workforce." You started this last May, so can you tell us a little bit about this effort? What was it aimed at and what's happening with it?

Mr. Friedman: We have a training/research/consulting practice at APHSA. In many ways, we needed to be clear about our core competencies and to match that with our members' needs. You know, there are dozens of very, very good consulting firms that do training and consulting in this country. We think that we have a unique niche in that we really understand the business of human services. So we began to do a whole series of evaluation of our own programs, asking our members what their needs were. And essentially they're saying that we need help in looking at organizational effectiveness and then developing good leaders.

And the other thing that has always troubled me as a consumer of consulting services and training was that very often we go to a training program and something nice happens, we put it on a shelf, and we get back and our desk is piled high and we kind of forget what we learned through that session. So we're very much into looking at actual products, being able to take something away from this experience. And so we created this concept of having an institute where our members, our states, and in some cases local organizations, would participate not for a one-shot training session, but through a process that would lead to a product.

Now, the workforce institute was particularly interesting because when we meet with our CEOs and we ask them what are your greatest needs, the issue of staff recruitment, retention, early retirements, building a bench for new leadership, I mean, many of my colleagues are my age, you know, baby boomers that are of retirement age, and we stand to lose a significant amount of institutional knowledge as well as leadership if we don't find some way to address that. Well, what we learned through our needs assessment was that very often human resources personnel offices weren't necessarily being seen as a solution, that personnel rules weren't seen as an asset that can help enable addressing that issue.

And so what we did was that we created this institute, and it lasted for a year. There were four group meetings of all of the participants, but then there was a lot of individual consulting and peer consulting, which was very important, that happened in between those meetings. And the end result was that the human resources directors walked away with a product which was a workforce plan that they could take to their governor's office. We actually field tested this by bringing in a number of retired commissioners, secretaries, and directors of human services and saying to them basically if your human resources director submitted this plan to you, is this something that you would support?

And so the end result of this one year was an actual working workforce plan that drilled down beyond, you know, I need 20 caseworkers because my caseloads are going to get this high, but looking at skill sets. Where do you find them? How do you work with the universities? How do you work with the training centers? How do you help grow internally your own training capacity to have this happen? What kind of array of benefits and training opportunities do we create for our workforce? How do we embed quality improvement in the way that we do business? And so it was beyond just how you do a workforce plan. It was how you actually make a more effective organization.

Mr. Morales: So Jerry, along these lines, to be a bit more specific, what are some of the workforce capacity building challenges faced by public human service agencies, and how does the institute seek to assist participants in strengthening agencies' workforces and human resource capacities?

Mr. Friedman: Well, what we're trying to do is to embed a strategic process in looking at our workforce needs. And that, I think, has been a missing element. I think we've done traditional recruiting and we've gotten people that have credentials. But when we look at the broader strategy of who's coming into human services today and making it a career, quite frankly, I'm a little troubled.

I'm at the tail-end of my career. I'm in my sixties. I was a product of the 1960s and the 1950s, and I was drawn to public service. It wasn't part of my family tradition. I was drawn to public service by the leadership of this country who talked about human services and public service being an honorable thing that should attract the best and the brightest. You know, we had leaders in this country who were great role models, and it troubles me today that we don't kind of have that sense of government as being such an instrument of good. Not to be critical, but when you turn on the radio programs around the country, all you hear is that government wastes this and government does that. I really take exception to that.

I have worked both in corporate America and I have worked in the public sector, and there are challenges in both and there is competence in both, and unfortunately, there's incompetence sometimes in both. But the public business is a little bit unique because it is in the open. And so I think all of that has created an environment where people just aren't as attracted to public service as they used to be. And so what we're trying to do is to rebuild that through reshaping our public image, getting back to the notion that human services is honorable.

We have always known, those of us who got into this, we didn't get into human services for the money. If we did, we made a very dumb decision. We were driven by a different kind of mission, a desire to make a difference in a different kind of way and contribute in a different way. You know, that spirit I think is something that we want to kind of recapture.

Mr. Morales: What about the future of public human services delivery?

We will ask Jerry Friedman, executive director of the American Public Human Services Association, to share with us when the conversation about management continues on The Business of Government Hour.

(Intermission)

Mr. Morales: Welcome back to The Business of Government Hour. I'm your host, Albert Morales, and this morning's conversation is with Jerry Friedman, executive director of the American Public Human Services Association. Also joining us in our conversation from IBM is Nicole Gardner.

Jerry, perhaps you could elaborate on the types of public-private partnerships that your members and affiliates engage in to improve operations or outcomes. And in what areas do you think you would like to enhance or expand these types of collaborations?

Mr. Friedman: Well, that's a very good question. In reality, there has always been, I think, a level of partnership between at least public human services and the private sector. Many of the actual services are provided under contract. Many of the charitable faith-based organizations have been dealing with people with needs, material needs, basic needs, other human services needs for years. So when you look at the array of vast human services networks that are out there, very often, the majority of the programs are actually provided within the private sector. However, recently, there has been more and more of a movement towards privatizing some of the core functions that had traditionally been part of government.

I think what we try to do best as a national association is to work with our members to make sure that they have weighed all of the factors they could consider into whether this is a good decision or not. I think the issue isn't the whos. It's more the issue of the whats, and being clear about what the core competencies are. If government entities are going to be contracting, then I think they need different skill sets, or need to emphasize skill sets a little differently. And I think we have a good example.

Twenty years ago, states ran huge data centers with state employees. In many areas, these are now run by corporate America under contract. What happened, though, in the state information technology world was that the core competencies changed. They changed to project management, contract management, automation planning, quality control. And I think the same needs to happen as we start to look at actual service delivery. But if we're going to be farming these activities out to for-profit or not-for-profit organizations, we need to be real clear about what the expectations are: managing those contracts and those projects effectively. And so I think that's the critical issue. It's not who's doing it, it's what's being done, and is it done with the eye of actually providing an improved service delivery system rather than because it seems to be the local trend.

Mr. Morales: So Jerry, obviously you just opened the door for a discussion on the future. What do you see as some of the emerging trends in social welfare policy over, say, the next 5, 6, 7, 10 years?

Mr. Friedman: Well, I think we're at a very exciting time. Again, I think the lessons that were learned from welfare reform, the demonstration that state and local governments really can manage programs effectively, is continuing to evolve and continuing to grow.

I see a number of different trends. I think the movement towards services integration clearly is happening in a lot of different areas. I think categorical agencies are beginning to realize that it takes a holistic approach in order to address the needs of families. I think more and more, state and local governments are looking how to return on investment. You know, is this the best result that we can get for the amount of money that we are investing? And I think it kind of goes beyond just looking at a program from a cost perspective. I think we need to look at it from an outcome perspective.

The continued advancement in technology throughout the entire human services system, from consumers to clients to the way that we process mega data in this country, I think is continuing to evolve. And what I see happening is that major corporations are now investing specifically in human services applications rather than retrofitting business applications to human services.

I think that there's going to be a continued movement towards consumerism. You know, there should be nothing about me without me. More and more clients are saying and progressive human services professionals are saying I need to involve a client in this decision in order to have the best outcome. And so there is more of a kind of openness and a willingness to do this.

And I think in many ways it could also be a cost driver, particularly in the health care arena. We need to have the costs of what it takes in medical care to be transparent. We need to know what they are. Consumerism can do a great deal to drive down costs. I heard Speaker Newt Gingrich talk about the airline industry, and he was talking about the combination of deregulation and the Internet and things like Expedia and Priceline and all those different things have driven down the cost of air miles from 29 cents a mile down to 10. It's just a stunning thing what competition can do and we need to start having that application in human services. I think continued partnerships and having strategic approaches and better use of data will continue to be a part of it.

And obviously volunteerism. We need to rely on a community not only for the services that they provide, but for the engagement. My experience is that when people become exposed to what happens in a human services agency or in a human services program or even in an institution, they become advocates for it when they begin to see what it's like. So I think that those are some of the major trends. I think the bottom line, though, to all of these things is what it has always been, and that's we have to keep the clients first. We can't lose sight of our purpose and our reason for being in the human services business in the first place. And that's because people that are at our desks are there with multitude of problems. They're in pain, they're in need. And so we can set up these elaborate systems, but we can't lose our heart. And I think that that's a lesson that's always with us, and to always acknowledge the awesome responsibility that we have in human services.

I used to tell my co-workers you know that a keystroke on a computer can make the critical difference as to whether a child goes to bed hungry or nourished, and that's just an awesome responsibility that plays out a million times a day in this country, and we don't take credit for it. We don't talk about how often the systems work. We focus in on the failures rather than our successes. And if we're going to really change the human services industry and have it grow and thrive as a viable part of our society, we need to change the public image. We need to be able to tell that story better.

Ms. Gardner: So continuing our theme of looking into the future, Jerry, from a policy perspective on some of the specific programs, you know, what's coming up for Medicaid, for TANF, for child welfare? What's going to happen over the next year or two?

Mr. Friedman: Well, I wish I had a crystal ball that I could say that, because we're caught in competing dynamics. You know, I think that there's a growing awareness among people who pay taxes that they want to see a return on their investment. And I think there's also a real acknowledgement that people do have human needs, and I think we're going to continue to strive for that perfect balance. But again, you know, I keep going back to the lessons that we learned through welfare reform about personal responsibility, about work opportunities, about empowering communities to make a difference. I think that those will continue to grow.

The health care area I think is fascinating because we really are, I think, in the early stages of a transformation. I see it happening again with the Medicaid directors in this country and the role that they're playing and looking at prevention and wellness programs, and I think that that'll continue to be a part of it.

I know the direction I would like to see Congress in the next administration go, and that again is always to empower states, to give them flexibility, to have administrative simplicity, to keep client needs at the forefront. And I think if we do that, we can continue to have a stronger society.

Again, the return on investment I think is really important. We as a human services industry need to talk about the return on investment that society does get. You know, when we think about the food stamp program, we don't think about what it infuses into an economy. It's not just that the people who are low wage are able to have better nutrition, but what does it mean for the grocers and the growers and those that transport food and how it contributes to a stronger society?

Think of a society without human services, what kind of world we would have. And so we're getting a little better at telling our story. And I truly appreciate the opportunity to be on a show like this to talk to your listeners and to tell the human services story, to share our challenges as well as some of the opportunities. And I'm just very, very grateful for this experience.

Ms. Gardner: Well, we're honored to have you. In the context of the story you just told about the profound good that can be done, children being nourished, families being helped, if you were to get your aspiration realized that Congress would be proactive and positive in its treatment of human services policy and legislation going forward, how would you challenge your members to then take those things and move forward to really meet the challenge of improving service delivery and living up to the picture that you've painted so articulately?

Mr. Friedman: Well, I think two things: to think holistically, how the various parts fit together to a system of care; and secondly, keep the clients first, keep the needs of the children in this country and the families who are struggling in this country. Unfortunately, I can walk out of this nice building in downtown Washington, D.C., and before I hit the next corner, I will be able to see the failures of our society, where people who have been left out and left behind, the homeless population, who aren't afforded, for whatever reasons, the opportunity to participate in the wealth of this great country. You know, we'll always have our work to do. So those are the things, the messages that I would give.

Mr. Morales: Jerry, it's hard not to be moved by your passion and dedication to public human services, so I'm curious, what advice could you give to someone out there who perhaps is thinking about starting a career in public service and perhaps in particular interested in working in the area of public human services?

Mr. Friedman: Well, I think that the best experience really is hands-on. I always encourage people to volunteer, to spend time in public facilities, nursing homes, to talk to people who have needs to see where their strengths and where they can contribute. I think that that's the greatest thing is through the exposure. You know, we appreciate all of the courses in social work and public policy that happen, but I think it's that hands-on experience, that personal passion that somebody can have, and the exhilaration of actually seeing somebody who has improved the quality of their lives because you've been there, because you've been working with them, because you've tutored somebody who was illiterate and now they're job-ready. I mean, I just can't tell you. It's like maybe the equivalent, the public human services equivalent, of hitting a grand-slam home run in a World Series.

One of the greatest things that I get to do sometimes is to go to graduation classes of public welfare agencies, where they've taken people who had not been job-ready and they're out and they're ready to join the workforce or perhaps they're already working, to see the transformation in their lives. They have a client come back to them and say thank you, you made a difference.

Just one quick story. When I was a probation officer, I had a huge caseload. I didn't always I mean, you had to kind of triage. And years after I had left this job, I received a call one night at my house and it was from a man and I could tell he was obviously very emotional. And he asked if I was the probation officer that had his case, you know, 5, 10 years earlier. And I had to really search my memory banks, and indeed, it was and I did remember that. And what he wanted to tell me was that he was in the hospital, his wife had just given birth to his first child, a son, and that he wanted me to know I was the second call that he made -- the first was to his parents -- that he would not have had that thrilling opportunity to be a parent had I not intervened in his life in an early stage when he was struggling with substance abuse. Now, I barely remembered the case and I didn't do great casework. I gave him a choice: you're going to rehab or you go to jail, you know. But obviously it made an impact on this person. I hadn't thought of that case in years, but to get that phone call is something that just stayed with me for the rest of my life.

We don't always know that we make a difference. And so that's what I would tell people, that if they want a career where they can have those kind of rewards and benefits, then human services is a place that they ought to look.

Mr. Morales: That's absolutely wonderful. Jerry, unfortunately, we have reached the end of our time. I want to thank you for fitting us into your busy schedule. But more importantly, Nicole and I would like to thank you for your dedicated service across the many years and roles that you've had in the area of public human services.

Mr. Friedman: Thank you very much. I appreciate it. If people want to find more about the American Public Human Services Association I urge them to take a look at our website. It has up-to-date information on all of the legislative proposals that are happening in Congress. It's a wealth of information, and it's at www.aphsa.org.

Mr. Morales: Great, thank you. This has been The Business of Government Hour, featuring a conversation with Jerry Friedman, executive director of the American Public Human Services Association.

My co-host has been Nicole Gardner, vice president and partner in IBM's public sector social services practice.

As you enjoy the rest of your day, please take time to remember the men and women of our armed and civil services abroad who can't hear this morning's show on how we're improving their government, but who deserve our unconditional respect and support.

For The Business of Government Hour, I'm Albert Morales. Thank you for listening.

Announcer: This has been The Business of Government Hour. Be sure to join us every Saturday at 9:00 a.m., and visit us on the web at businessofgovernment.org. There, you can learn more about our programs and get a transcript of today's conversation.

Until next week, it's businessofgovernment.org.

Originally Broadcast August 4, 2007

Washington, D.C.

Welcome to The Business of Government Hour, a conversation about management with a government executive who is changing the way government does business. The Business of Government Hour is produced by The IBM Center for The Business of Government, which was created in 1998 to encourage discussion and research into new approaches to improving government effectiveness.

You can find out more about the Center by visiting us on the web at businessofgovernment.org.

And now, The Business of Government Hour.

Mr. Morales: Good morning. I'm Albert Morales, your host, and managing partner of The IBM Center for The Business of Government.

As the United States Air Force continues to transform its capabilities to meet emerging national security challenges, it has sought to ensure the effective and efficient integration of technology, people, and processes to provide the warfighter and decisionmakers with timely and actionable information shared across a worldwide platform.

With us this morning to discuss efforts in this area is our special guest, Lt. Gen. Michael Peterson, U.S. Air Force, Chief of Warfighting Integration and Chief Information Officer.

Good morning, General.

LTG Peterson: Good morning, Al. Glad to be here.

Mr. Morales: Also joining is our conversation is Dave Hathaway, partner in IBM's defense industry practice.

Good morning, Dave.

Mr. Hathaway: Good morning.

Mr. Morales: General, perhaps you could set some context for us by describing the mission of your office and how it supports the overall mission of the Department of Defense.

LTG Peterson: Well, you started off really well in the opening paragraph: integrating processes, people, and systems to deliver information. But if you look at the history of the U.S. Air Force over the last dozen years or so as we really got into the Information Age, we had built exquisite systems but they were independent systems. So my job, and the job of my office, is to go back to our legacy systems, make them interoperate to deliver fused information to anyone who needs it, whether it's a commander or warfighter, an executive in our business and support systems, but deliver that information for the legacy context, but at the same time point a roadmap for the future, so that as we build out future systems, we don't go down the same path of independent non-interoperable capability.

Mr. Morales: General, could you give us a sense of the scale of your operations? How are you organized? What's the size of your budget and your staff, and is this a worldwide footprint that you have with this mission?

LTG Peterson: It is absolutely worldwide, and it touches every aspect of the Air Force's mission, and much of the work that the Air Force does as the joint interdependent partner with the other services. But in terms of scale, we manage an annual budget or portfolio of about $7 billion. Beyond that, there are about $17 billion in systems that are out there operating today. When I say portfolio, that is to set the policy, to set the rules, to build an enterprise architecture that shows us where we're going and how we'll operate today.

Mr. Hathaway: Sir, would you please describe your specific responsibilities and duties as the Air Force's Chief of Warfighting Integration and Chief Information Officer?

LTG Peterson: Sure. And the reason that it's set aside as not just Chief Information Officer, it was clear to our leadership that it wasn't just business systems or support systems. This was the entire arena of command and control, intelligence, surveillance reconnaissance, and all of the business and support systems that make our Air Force run. So warfighting integration included data links, it included the command and control systems. It included the communications networks on which they all ride. So that's why it was Warfighting Integration, and then all of the -- what was passed down in the Clinger-Cohen Act and the Federal Information Systems Management Act later on for the chief information officer responsibilities for the Department. So those two tied together, we put in one office, because everything we do is interrelated.

Mr. Hathaway: Sir, regarding your responsibilities and duties, what would you say are the top three challenges you face in your position, and how have you addressed those challenges?

LTG Peterson: Well, the number one challenge is in this arena of information technology, this audience knows how quickly that moves, and how rapid the turnover is in terms of technology and what opportunities are out there. So my number one challenge is educating the Air Force on what the potential is for information technology -- to allow those people to operate more effectively and more efficiently. So that's the number one challenge.

Number two is that is not the way we operated for years. For years, we operated in mission areas or functional areas, and each of those were able to independently develop and build systems that met their requirements. That gave great capability but it didn't give great interoperability. So my number two challenge was to bring all of those different functional entities together so we can be interoperable across functional areas, across command lines, and especially in the joint arena.

And the final challenge has to do with security of the information -- information assurance, on a broader scale -- to ensure that the capabilities we provide are consistent, that they are safe from losing information or from people treading upon our networks or capabilities that we don't want to be there. So it's the education, breaking down those cultural barriers, and then securing our networks.

Mr. Morales: It sounds like a very broad mission for just one individual, General. Now, you've been in the Air Force for some 30-plus years. Could you give us a sense of how you started your career within the Air Force?

LTG Peterson: I attended the University of Southern Mississippi. And right away, I'm not kidding you, it was "I guess I better find a job." So I joined Air Force ROTC, with a degree that was in the sciences: math, and minor in general sciences. The Air Force looked exciting. I joined the Air Force and they put me in the communications electronics maintenance arena.

After that first dozen years with hands-on kind of work, I moved into the space operations business; at first managing communication satellites, and later commanding space operations units, squadrons and groups.

At that time, literally, the Internet had emerged as the powerful capability we all respect it for today -- that was the middle 1990s -- where I came back to the command and control business and was building air and space operations centers in places like Riyadh, Saudi Arabia, and later on throughout Southwest Asia, where we operate today. That gets into a part of the career where it was more about management and leadership and less about hands-on technical direction, which is where I find myself now after a series of staff jobs with our major commands and our combatant commanders, and now here in the Pentagon.

Mr. Morales: So, General, with the various roles and commands that you've held, how have these experiences prepared you for your current leadership role and informed your leadership style and management approach?

LTG Peterson: Well, you said just a moment ago, Al, that that must be a big job for one person. And as you can imagine, I have lots of help, and very talented help. Early on in my career, it became so apparent that I wasn't going to be able to invent all the great answers. And if you just put out a vision that was understandable that people could resonate with and then step back and listen for the feedback, ask for advice, ask for people to take ownership of an initiative, of a problem, of an opportunity, they would. And that describes my leadership style, or what I think has helped in my success today. Be very clear in what you think we ought to do, but also understand that there are smart people everywhere, and you don't understand their job as well as they do. So ask for advice, give them the freedom to take charge, occasionally make a mistake, and we will all learn from that and be successful from that.

Mr. Morales: What are the U.S. Air Force's IT transformation efforts?

We will ask Lt. Gen. Michael Peterson, U.S. Air Force Chief of Warfighting Integration and Chief Information Officer, to share with us when the conversation about management continues on The Business of Government Hour.

(Intermission)

Mr. Morales: Welcome back to The Business of Government Hour. I'm your host, Albert Morales, and this morning's conversation is with Lt. Gen. Michael Peterson, U.S. Air Force Chief of Warfighting Integration and Chief Information Officer.

Also joining us in our conversation is Dave Hathaway, partner in IBM's defense industry practice.

General, the Air Force has stealthy precise weapons systems and the best airmen in the world; and by adding IT to that mix, the service has been able to make its assets more efficient and powerful.

To that end, could you elaborate on your warfighter integration vision?

LTG Peterson: It was during Kosovo, and we knew that we had to roll back the integrated air defense system around Pristina so we could fly our non-stealthy aircraft in and strike the Serbian ground forces -- without a ground force to flush them, that's a difficult task. There was one SA-6 guarding the capital of Pristina. We've surveyed the area now to bring in a surveillance reconnaissance asset to look at those hide sites, one of them has the SA-6 on it. No, the mission is not done. You don't know exactly where that hide site is until you've sent the image back to another computer, stretched it to fit the grid coordinates on a map. Okay, now we do know where it is, but the clock keeps ticking.

Now it's time to find out if you have an asset to strike the SA-6 surface-to-air missile battery. Sort through available platforms, start to do mission planning, line that strike platform up with the support package -- by that I mean the tankers that will refuel it on the way, the electronic warfare assets that will support it, and to complete that mission in that instance took 4-1/2 hours, and as we like to say, 17 consecutive miracles.

Anyone that looked at the details of what we had done -- this was the 1999 time frame -- that understood information technology would have said, why haven't you modernized, why haven't you linked these warfighting systems together so that critical pieces of information, once you understand the process, will flow machine to machine, it's not someone shuffling papers, it's knowledge that is fused and put together so a decisionmaker, a commander, a pilot, can make a decision and take action and not pass information around?

And that was the genesis of warfighting integration. Today, that same action in Iraq or Afghanistan is down to tens of minutes -- certainly less than 30 minutes that we would be able to go strike any what we call time-sensitive target, because we've planned for it. So plenty of work left to do to make us more lethal, more effective, and certainly more efficient.

The good news is with what industry has been able to offer us, it's quite often more efficient and less costly to pursue the modernized capability than to stick and sustain the legacy systems.

Mr. Morales: So to what extent does your warfighting integration plan deliver a roadmap to the future and ensure that the right investments are made to optimize decision superiority to the warfighter? And what are some of the key benefits and critical challenges to this implementation?

LTG Peterson: That is a great question. The key to all of this, and I'm glad you said roadmap -- the key to all of this is an architecture, an enterprise architecture. And that starts with, as I said earlier, policies, rules, processes, and eventually, it gets down to a roadmap and a technology description of where we need to go so you can make investment decisions.

The Air Force started down this architecture journey in earnest about five years ago, and at first, it was little more than drawings of boxes and linking them together. It was not rich in its description of policy or the rules by which we operate. It has certainly matured. When OMB came to visit six months ago and asked about our architectural work, I could point to the work that we had done in 2006 alone. I could tell them how much money we had spent on building out the architecture, and then show them definitively that we have been able to make decisions about future systems in terms of retiring them in lieu of new capability, in terms of investment, where for every dollar we had spent on architecture, there was $10 of cost avoidance in the outyears.

And so the cost avoidance money that we didn't have but were going to have to find ended up over the next five years $77 million -- that we didn't have to spend those dollars because we made an early good decision based on architecture.

Mr. Hathaway: Sir, DoD is transforming from platform and organization centric to a netcentric operation, and the Armed Services CIOs are providing the leadership to meet this netcentric vision. Would you elaborate on this netcentric vision for the Air Force, and what exactly is netcentricity?

LTG Peterson: Netcentricity, and we throw that term around, everyone wants it to be a technical solution. Certainly technology underpins it, but it starts with understanding of a process. So if I am a joint force commander -- for instance, Gen. Petraeus, he should have access to every single piece of information that we have -- he needs a fused real-time picture of what's happening. He needs to understand the impact of a capability that the Air Force might bring to the fight versus what it would take for other services to create the same effect.

Netcentricity is exposing that information or that data, allowing it to maneuver the network under a framework or a set of processes that we have prescribed so that that commander has exactly the information he or she requires to get their job and their mission done. And it's not just up the chain, it's down the chain. It's so the air component and the land component can exchange information seamlessly and in real time without having to go through 16 different translators.

So the netcentricity comes from understand the process, understand the flow of information, understand the data and then put the technical rules in place so that information can flow. As simple as what is the service that you use to send messages across your network? Is that the same message service that another component uses? If it's not, how do we account for that? Do I describe this type of data one way and you describe it another? That's the reason the CIOs of the services are perfectly poised to really lead this effort. Now, I'm not going to name data, I'm going to find that functional expert and build a team around him or her that can identify the data, create the taxonomy, describe the process, and then we'll provide the technical expertise so when it's time to build an application or a service on this broader network, we all can use it and benefit from it.

Mr. Hathaway: Last year, the Air Force added cyberspace as a mission area, in addition to the traditional air and space operations. What challenges have you faced in creating the cyber command and integrating it with existing Air Force operations?

LTG Peterson: The first challenge is always, so what is that? And I say that tongue in cheek, but it is not simply IT networks, it is also the RF spectrum. It is also -- in the future, it would include directed energy weapons. Cyberspace is a domain in which we operate. Cyberspace is a man-made environment. So anything in a electromagnetic spectrum, in a man-made environment, that would be cyberspace.

So the second challenge is our leadership understanding the important of cyberspace in the future, for us to be able to operate freely in that domain, to know that that domain will always be available for our use. So to operate it, to protect it, defend against attackers. Why would we ever want an adversary to have that same freedom of movement in a similar domain? So to think about ways that we could take that capability away from a potential adversary.

And why did we start now? Certainly, the Air Force, all of the services, do a lot of work in the cyberspace domain today. But we do it for the most part in functional stovepipes, so we have our intelligence surveillance reconnaissance community that does some work in the cyber domain; but they do it separately. What we really must develop is a professional force that is steeped in all of those elements of the cyberspace mission.

And so how do I grow that expert with that breadth of knowledge? Well, it will probably take a decade or more to start to grow. So it's not about Mike Peterson, it's about the captains and the staff sergeants that are out there as well as our civilians that we want to bring into this culture and to train them across the breadth of cyberspace missions.

Mr. Hathaway: Sir, you mentioned the importance of data before. What is the Air Force's data strategy for the new digital era, and how does the strategy seek to make data identifiable, assessable, and understandable throughout the enterprise?

LTG Peterson: Our Secretary of the Air Force, Sec. Michael Wynne, brought some great experience from industry with him, and part of that had to do with exposing data and information. Industry viewing information as an asset, as you would any other item on your tally sheet. And it was really his emphasis that got us moving in the direction of our Air Force data strategy. He asked us as a staff to be able to conduct a clean audit, where we understood the rules, we could expose the information, and then we could repeat the process time and again.

And we're well on our road with the first deliverable of a set of pathfinders that take us on the clean audit. I understood full well that he knew that the Department would operate more effectively, both on the warfighting aspect and on the business aspect, if we could discover data, expose data, share data, and we understood when we spoke about data, what we were talking about: the taxonomy, the vocabulary.

He took us on this journey where each functional community, each mission area has been charged with the responsibility of understanding the data, understanding the processes through which they employ that data to come up with answers. So it's building communities of interest that would go out and do the definitional work, understand the process so you can map out the data flow, the ontology, and then build a vocabulary.

Now that we've done that, the Department of Defense can leverage any work that we've already done. We're leveraging work that the other services have done, and eventually have this very rich vocabulary -- understand the processes, the ontology.

Several seemingly small but very important examples: one I'll quickly highlight. At Patrick Air Force Base, one of our satellite launch facilities near Cape Canaveral, Florida -- but at Patrick, before you could launch a satellite, you had to understand that all of the range systems were ready or what the stage of readiness before we could launch a satellite. And of course, you know what we did; we threw an army of people at it. Instead of going to each of those systems, exposing the data, building a real-time runtime metadata environment, so you simply go to the website, type in the mission number, and all of the supporting systems on the range that are required to launch that mission number -- immediately the database is populated and you get the status.

But that describes our data strategy, finding out where the authoritative data is, describing it and making it available for everyone to use.

Mr. Morales: General, we've used terms such as architecture; we've used terms such as netcentricity. I'm going to add one more to the mix here, and that's service-oriented architecture.

Now I'm going to try to phrase a question that uses all three of these terms. What role does service-oriented architecture play in making your data strategy as well as your overall netcentric vision a reality?

LTG Peterson: The importance of a service-oriented architecture is that services -- what we used to refer to as embedded applications or capabilities or tools -- those services are now able to be shared across the enterprise. So if I built a service that kept track of who is supposed to be on the network, and could certify that yep, it's Mike Peterson on the network, if I built that service, in the past, it would be embedded in a system. And only that system could benefit from the service.

In a service-oriented architecture, I can build that service, I can publish it and expose it for everyone's use. Now, that saves -- because we all know what service we're going to use, there's built-in interoperability. Because we can all share that service, we don't have to reinvent another service. So service-oriented architecture allows you to publish the service, share it.

Now, you are into the issue of identifying which piece of data is authoritative, and because I can always go get it, then I don't have to build data warehouses, because I know what protocols and services to count on, so now I have interoperability.

So the benefits of a service-oriented architecture are huge in terms of access to information, interoperability and cost of sustainment. It's not really easy. And that's why, as I said, we're undertaking a number of pilots or pathfinders, small steps, where we can understand how to expose data, build a metadata environment, build out the communities of interest, working with our acquisition teams, what are those services out there that we think, based on industry advice, are most likely to stand the test of time so we don't replace that service in a few years.

The other big piece of service-oriented architecture is configuration management. Understanding who is providing a service, hosting it on their server or what framework, understanding who the authoritative data sources are and making certain they understand it; and keeping our vendor teams knowledgeable and integrated so that we can continue to build and not repair. We are absolutely excited about service-oriented architecture. It's not necessarily something that you have to take in one entire bite.

But I really do envision that in a dozen years or more that it will be much more a pure service-oriented architecture than it is today, but it will be one bite at a time as we move forward, and allow us to spend our dollars more efficiently.

Mr. Morales: What about the U.S. Air Force's IT innovation?

We will ask Lt. Gen. Michael Peterson, U.S. Air Force, Chief of Warfighting Integration and Chief Information Officer, to share with us when the conversation about management continues on The Business of Government Hour.

(Intermission)

Mr. Morales: Welcome back to The Business of Government Hour. I'm your host, Albert Morales, and this morning's conversation is with Lt. Gen. Michael Peterson, U.S. Air Force, Chief of Warfighting Integration and Chief Information Officer.

Also joining us in our conversation is Dave Hathaway, partner in IBM's defense industry practice.

General, the cost of sustaining about 19,000 legacy applications must be absolutely staggering. I understand that you save approximately $1 million for every legacy application retired or moved onto the Air Force portal or the Global Combat Support System.

Could you elaborate on the development of the Global Combat Support System and the Air Force's portal? How does it enable your force to achieve a broader netcentric data-transparent capability, and are there plans to migrate to a single DoD portal?

LTG Peterson: Al, thanks for the question because it's an important issue. Yes, the legacy platforms are very expensive to sustain. The sustainment is mostly about keeping those legacy platforms or systems talking to or interoperating with sister systems. That's where about 80 percent of the sustainment dollars go. And this is not modernizing, this is just keeping them running.

The Global Combat Support System was built as a framework for our support systems. There's always a fuzzy gray line between what's a support system and what's an operational system. When the Air Force went down the road of a portal, that portal was simply a presentation layer of information that was on our integration framework. So we looked across the Air Force at lines of business -- logistics, human resources, financials, and as we looked at the multitude of systems, you are correct, 19,000 different applications out there that the Air Force sustains every year. But as we looked at those lines of business, we recognize that if we took those lines of business and started building them with common protocols, common standards, common services embedded in them, then the cost in that line of business, sustaining those systems, would go down dramatically.

So GCSS Air Force -- that's the acronym we use for the Global Combat Support System -- was not so much a portal, it was the integration framework on which we were going to host services. So when I ask you to build the next munitions tracking system, you only had to build the piece to track munitions, not the messaging software, not the database administrator. All of those services were already available on the integration framework, and you were automatically interoperable with.

That vision has continued to grow across the Air Force. Today, as we build out GCSS Air Force, the other thing it gives us is a way to put information where it belongs. Example: when we originally built capability in the Air Force, it's wherever that information was created was generally where we plopped down the server that would do business with all of our partners.

So to come in and to access that information, you were able to traverse much of the Air Force network. So now with GCSS Air Force, where we are able to host those systems, those applications, at the edge of our network so you can get to that information without traversing the network -- security, you don't have to run a single server for a single application; efficiency, it's made that network much tighter and much more efficient in terms of running it.

The integration aspect of the framework has made it easier to build systems. The portal, on the other hand, still remains simply a user interface or a presentation layer to that information for different lines of business.

Now, you asked what about eventually a DoD framework and portal. You compare the Air Force portal to today's Army portal, Defense Knowledge Online, which is a joint perspective -- their portal and their presentation layer offers much more service and capability than the Air Force portal. It is a wonderful tool for a unit to manage a deployment of soldiers and to keep them engaged with families back home, for families to be able to understand what the unit's doing. It's a very rich capability.

The Army, on the other hand, has not made the investment on the integration framework. It's not that they don't intend to, it's just where they are in the program. So yes, I would very much like us to come together out there in the future as the contracts for DKO, Defense Knowledge Online, and the contracts for GCSS Air Force, when the timelines come together, I'd very much like to have a single offering. Should that not be possible, there is still the opportunity to have a federation.

What do I mean by that? The real reason you want to be under a single framework is so if I'm the joint force commander and I need information about an Air Force line of business that is hosted on the Air Force portal, the integration framework GCSS Air Force, then somehow I've got to get to that information. The system won't let me get to the information unless it knows who I am.

The way you work around that is you share a common identity management service, you exchange certificates. And you can do those. The technique is called federation; you just have to decide what are those core services that have to be common -- doesn't matter what the look and feel is, it best suits your line of business or your operational need.

Mr. Morales: So it's really about driving interoperability across the DoD as opposed to within the various line of service?

LTG Peterson: Right, because we don't fight as services, we fight as a team. And that is the test of whether or not we will be successful is if some deployed soldier, sailor, airman, marine can get the information that he or she needs exactly when they need it without 15 phone calls and having somebody else log into the computer for you.

Mr. Morales: General, as a component of the Air Force's larger communications and information strategic transformation, would you discuss your efforts to implement an Integrated Network Operations and Security Center, or the INOSC, and how does the INOSC initiative reduce your footprint and increase process and personnel efficiencies?

LTG Peterson: Briefly, I told you how we built our networks. We built them one room at a time, one building at a time, one group of buildings at a time, one base at a time. That's how our networks grew up. Industry brought tools along for consolidation, so you reduce the overhead cost of operating a network. One of the reasons that we did not immediately follow that was we wanted each air wing, space wing to be complete, to have its own embedded capability.

So what we have done is stepped back from our network and said we will operate this as an enterprise. When we started, we had 17 separate network operations and security centers, and well over 120 network control centers. You don't need that many, even as a network as large as ours. Today, we have two integrated network operations and security centers divide up the work and have a continuity of operations plan where one could back up the other, and that's a standard business practice. But to do that, we had to make investments in modern network management tools.

On a side note, when I first arrived on the job, I was very concerned of course about network security, and so we went down the path of a standard desktop configuration, a standard server configuration for purposes of security. Well now, we've implemented a standard desktop solution and we're well along on a standard server solution so that we can do all of the patching remotely, and now, we no longer require touch maintenance.

Today, it's hours to patch the network. And it's because of the tools that we've adopted. We did that for the purposes of security. I didn't understand until later that my goodness, all of the workload we took off the shoulders of those systems administrators.

I was at the Pentagon just a couple of months ago, and a staff sergeant, Air Force staff sergeant got on the bus and he walked by me up the aisle and he stopped and he said, sir,

I'm a systems administrator, I just arrived here from Hill Air Force Base. He said we were working 65 hours a week, me and my team, and we were getting farther and farther behind on patches. We could not keep the systems patched until standard desktop came along. He said, when I left, we already had cut our workload down to just under 50 hours a week.

He says, I think by the time we're done, we'll be working less than 40 hours a week. That's when the actual other shoe dropped. He said, that's really a good news story because you know we're going to reduce the number of systems administrators we have next year.

Mr. Morales: Right.

LTG Peterson: You know, we're reducing the manpower in the U.S. Air Force, but leveraging information technology, whether it's in the IT arena or the human resources or finances or logistics, has played a huge role in being able to reduce the required manpower and still be very effective in an operational environment.

Mr. Hathaway: Sir, you mentioned the personnel cuts being experienced by the Air Force. The Air Force is experiencing these reductions as a result of PBD-720. How are you successfully meeting your mission requirements while at the same time absorbing these reductions?

LTG Peterson: Well, that's a timely question. We knew that if we embraced industry best practices, moved on to next generation software and tools, that we could be much more efficient across the Air Force. And as I said, it's not just IT, it's logistics, it's human resources, it's finance, it's every single thing we do, we could become more efficient.

Understanding that, the Secretary of the Air Force and our Chief were faced with a dilemma. Our Air Force really had not recapitalized its capability through the '90s and into the first five years of this decade. We are flying aircraft whose average age is 24 years. In fact, Navy ships on average aren't that old. We had to get started on recapitalizing, and you've seen what we've done with our next generation tanker, combat search and rescue platform, where we need to go with aging fighter and bomber aircraft. And you've seen that in the news, but the problem is so huge that you have to start now. It will take us 25 years to recapitalize the tanker force alone.

Well, in the middle of a War on Terror, the resources for recapitalization simply are not going to be there from external sources. There's a fight going on in the desert; there's a fight going on globally, and that's where our attention is focused. So to find dollars for recapitalization, what could we do internally? And that's when the Chief and the Secretary realized that we could embrace, as I said, industry best practices and tools and become a process-based organization, and we could create our own recapitalization capital. This was not about taking away warfighting capability. In fact, if you do this correctly, you increase your warfighting effectiveness, at the same time reducing the manpower requirements for the mission support arena, and that's that we've done.

The example of standard desktop, the example of INOSCs, those and some others have allowed us to take the first 6,000 personnel out of network services delivery. We need to do more. If you look at my common operational picture that I spoke about earlier, I can map initiative after initiative to the manpower that it will reduce, and it's already begun to reduce, in the Air Force-IT arena.

For instance, no one in industry would have a help desk at every Air Force base. We do. We're consolidating help desks. No one would have a server farm at every Air Force base, given the modern network paths that are available to us, but we do. Those are the examples of the other -- and there are 13 initiatives that -- every single one was looking over the hedge at industry and asking so how are you doing this? And we're getting great partnership, because we're finally getting some unsolicited proposals for how we might better conduct telephone operations across the Air Force. Companies that have investment dollars and great ideas that I think you'll see us implement.

While at the same time we've done that, I can go back to our air expeditionary force -- that's how we build our packages to deploy and how we go to war -- and I can map all the capability required in each AEF package back to capability that still exists that's not going away.

Now, what do I mean by that? We would have tanker aircraft go into depot for their maintenance cycle that comes every few years, and they would be there so long that aircraft would just pile up in the depots as we worked them through the process line.

But today, they're coming out so much more rapidly, it equates to more than a squadron of airplanes back on the ramp available to fly missions. Those are the kind of efficiencies, and if you can do it quicker, you can do it with less manpower, that's the kind of example. So PBD-720 -- it is difficult because it's something you have to do quickly and move out. The dollars that we would have spent, we will invest in the recapitalization of the Air Force.

Mr. Morales: General, changing topics a bit here, could you tell us little bit about something called ROVER, the Remote Operations Video Enhanced Receiver? How has the ROVER technology tightened the seams in the so-called kill-train in increasing the speed and lethality of air power? And could you illustrate this with a real-life example?

LTG Peterson: Sure. And the ROVER is a great example. In the airborne environment, we have -- it's rich with information, data links, imagery from targeting pods, access to the images that a Predator, an unmanned aerial vehicle, would provide. But as we got into the desert initially, that information wasn't immediately available to the soldier, the marine, the battlefield airman on the ground. Yes, they could get a radio call, but they couldn't see moving imagery or the picture of what was over the hill or what was in the compound that they were focused on as the target.

ROVER came from initially the Predator -- the AC-130 gunship wanted to know if, gee, if Predator imagery can be sent all around the world, why can't I see it? So for the Predator, we put together a very simple receiver in a laptop computer, and so if there is a Predator in your area, you tune to that frequency and you take the downlink to the Predator and you see exactly what the Predator sees. Now we're on version 3 of ROVER, and it's much more capable now in terms of that feedback loop of how I ask for information and provide feedback to the operator. And it's not just Predator, it's many of the targeting pods that are on our fighter and strike aircraft also have a transmitter now embedded in them that allows them to go direct to the ROVER.

Lots of battlefield examples, but one that's a little closer to home, is after Hurricane Katrina, we took 10 ROVER sets, which was a little tiny hand-launched Styrofoam UAV with a camera and transmitter -- that was the picture piece -- and then the ROVER itself was the receiver unit on the ground, and we took them to New Orleans to help with the recovery effort. And initially the thought was these will help with search and rescue as we find those victims that are stranded on rooftops or need assistance across the city.

But with all of the helicopter traffic, it didn't look wise to be flying more UAVs. And since they were Styrofoam airplanes, we cut the wings off and strapped them to the struts of helicopters, and gave great situational awareness to the commanders back at the op centers to see what was going on with the helicopters.

Now, the helicopters were busy doing real search and rescue, so they weren't busy pointing the ROVER around where the commander might want to see something else, so that became a signal of opportunity. You know, watch it, but I'm not going to try to steal the helicopter time from what they're doing. So what we did is on one of the taller buildings there in the city, we went up and put four of the Styrofoam bodies and taped the cameras on an antenna tower on top of a hotel in town, so you had a 360 degree panoramic view of the city.

And that's where we got warning when you saw the fires, where you saw -- and you could steer the camera -- where we had other activities going on on the ground where you could alert law enforcement or search and rescue, that became the eyes of the commander in the op center, and extremely valuable. Today, there are over 3,000 ROVER units over in the theater. More are on the way. As I said, incredibly valuable, but just literally one of dozens and dozens of innovations that were out there that industry has helped us put together that we get to put to use every single day in the fight on terror.

Mr. Morales: That's a great piece of technology.

What does the future hold for the Air Force's IT efforts?

We will ask Lt. Gen. Michael Peterson, U.S. Air Force Chief of Warfighting Integration and Chief Information Officer, to share with us when the conversation about management continues on The Business of Government Hour.

(Intermission)

Mr. Morales: Welcome back to The Business of Government Hour. I'm your host, Albert Morales, and this morning's conversation is with Lt. Gen. Michael Peterson, U.S. Air Force, Chief of Warfighting Integration and Chief Information Officer.

Also joining us in our conversation is Dave Hathaway, partner in IBM's defense industry practice.

General, as a CIO, a big portion of your job is to put in place the policies, the cultural change strategies, the educational outreach to help staff recognize that they are part of a much broader enterprise. To this end, what are some of the common pushbacks that you encounter as a CIO?

LTG Peterson: The common pushbacks, it's never really pushback; it's lack of understanding of what the teaming relationship needs to be. I am not going to own the process; I am not going to take over the mission set.

But the common pushbacks are, wait a minute, you don't know anything about my business. And I don't claim to. I claim to be very good at listening, helping plot out the processes; helping those owners of the information understand their data, understand why it is important to name and describe that data, and then we can help with what is the art of the possible with turning on the vendors that are out there that are ready to come and help.

I mean, most recently, our training command came, and their need is absolutely genuine, they do not have a single capability to manage students across the spectrum of training as they flow from recruiting to basic training to those first technical or operational schools and then out to the Air Force. We have multiple systems that don't talk to each other, that you end up what we call thumping data back into them. The need is exactly correct. But they did not have the expertise to understand how to expose their data, build and publish services and capability. Instead, they were on the path of building another monolithic system that would talk to no one else. So after the -- and the good news is we're all friends. But it really took several sessions before everyone understood the right path, and we are going to deliver capability in the same time frame. In fact, better capability, for about 10 percent of the cost. So it's exciting.

The pushback is no longer there in the Air Force. And really, I will point to our Secretary, Michael Wynne, because he didn't point to me and say, Mike, you're going to run data transparency. He said Mike, you're going to support data transparency, and he looked at all the other mission owners across the Air Force and said, you're going to own data transparency. And so the pushback, it started with why are you interested, and it's more into, I'm sure glad you're here, and I'm sincere about that.

Mr. Hathaway: Sir, with the evolving global threat environment, there are many new challenges associated with it. How do you envision DoD and its information technology efforts evolving in the next five years to meet these challenges?

LTG Peterson: The next five years will really be important to us. We talked about one of those areas, the portal, Defense Knowledge Online, Air Force portal, where we have to go to share information. The next five years are critical, because today, it is too hard for someone in the joint arena to access all the information they require to do their mission. So the decisions we make about netcentric enterprise, the decisions we make about data strategy, about protocols, will be very important. But I will tell you that the forums that we work together -- and not just Department of Defense, but the entire federal government -- OMB does a very good job of sharing across the federal government, and they are very quick to identify a best practice and share that with all of the other federal agencies that are out there. We've done that in a number of areas.

So I think the important things will be moving out on the service-oriented architecture, moving out on that technical framework that underpins the portals, deciding what services will be available and who will provide them, how will we build them.

Now, that's all on the producing information and getting at their side. The other most important pieces will be on network security. We face some very talented adversaries on our networks. And you will see us continue to build out that -- some people call it the moat in the castle wall -- of course, we will still continue to do that, because you can't even be susceptible to that weekend hacker, so you build the moat and the castle wall to keep out your average hacker.

But then you have to go beyond that with really redesigning our network, where do we allow people to transit our network? How do we handle identity management? What are the tools so we can do business within the government and with our partners outside the government, but not allow people inside our networks? So network security is an area that once you build that castle wall and the moat, now you can get on with the business and put your real talent, your people, against the threats that are a little tougher to uncover -- where malware has been installed on a system, where you have a disgruntled insider that is willing to push information out.

And those tools that help you understand where data is, where it's moving to -- you know, what appropriate behavior is on the network, those tools are emerging in industry as well, and you'll see us implement those as we not only generate the capability to deliver information to everyone that needs it, but lock down any information that shouldn't be exfiltrated or moving outside the network.

Mr. Hathaway: We mentioned transformation earlier, and transformation creates new and competitive areas and competencies that are needed. What qualities will be needed in the warfighter of the future, and those IT staff who provide support? And to that end, what steps are being taken to attract and maintain a high quality technical and professional workforce?

LTG Peterson: Attracting the high quality workforce, we've been very good at that. And I know that in the news you see concerns about meeting recruiting goals. But I will tell you, the only reason it's difficult is because the standards are so high. I am just thrilled by the airmen and the officers that I see emerging from our basic training in our tech schools. So the challenge is we've got the workforce, there is no question about that.

The challenge is two parts. Number one, we will always have to partner with industry. Anywhere we're delivering network services, you are going to find a complete team, you'll find people in uniform, you will find government civilians and you will find industry partners that quite often bring the latest and most up-to-date technology or the individual with the deepest knowledge base.

On the training side, that is a challenge, it is to ensure that our schoolhouses, number one, are current and they're teaching the most modern technology. The next challenge though is how do we build the forums or the interest amongst our workforce. That is a bigger challenge for us, is to keep the workforce current.

Mr. Morales: General, you've had just a fascinating and very successful career of serving our country. What has been the most rewarding aspect of your Air Force career, and what advice would you give to someone who perhaps is thinking about a career in public service, and let's say is thinking about the Air Force?

LTG Peterson: When I was a First Lieutenant, I was stationed at -- Second Lieutenant and First Lieutenant, three year point, I was stationed at Offutt Air Force Base, Nebraska, at the time, Headquarters Strategic Air Command. And until that point, I had never thought about making the Air Force a career. And I'd been working in some projects with two large companies that -- they're still in business today, so they're successful, and I was their Air Force counterpart, and we were putting in a system that in 1977 you would describe as a cell phone network for the commander so he could travel around the greater Omaha area and still be in contact with the national command authorities.

Well, they came to me and said, well, Mike, what are you going to do when you get out of the Air Force? And that's the first time I was forced to answer the question. And so I sat down to talk with the representatives of the two companies, and they offered me, in those years, a whole lot more money than I was making in the Air Force. And I said no, I said I think I'm going to stay in for another assignment. But that was the point when I figured out why.

It was the people you got to go to work with every day. It was the trust relationship, that it didn't matter who you were if you were in an Air Force uniform, you could pick up the phone, ask for a bit of information, ask for help, and you would get a response. Later on, the second half of why I think it was so important to stay in the Air Force -- and this is true in some elements of the business -- industry -- but in the Air Force, your boss wants you to succeed; he doesn't want anyone to fail. I don't care who you are, he wants you to be a success. Because in the Air Force, we all have a plan, someday we're going to retire.

And you can't go hire your replacement off the street, you've got to develop your replacement. So I have served for or worked for dozens of bosses, and every single one of them wanted me to be a success story. Occasionally there was the good feedback, like maybe you wouldn't do it that way again. But most of the time it was open doors, provide really good advice, include me in decisions and conversations, so later on I would know how to tackle that same kind of problem.

So those two things, of great people and bosses that want you to succeed and move ahead in your Air Force career. And I know you don't expect anything else, but I wouldn't trade it for anything. I've had a great time.

Mr. Morales: That's fantastic, General.

Unfortunately, we have reached the end of our time together. I want to thank you for fitting us into your busy schedule, but more importantly, Dave and I would like to thank you for your dedicated service to our country and your leadership in the U.S. Air Force.

LTG Peterson: Well, Al and Dave, great session here today. So often you want information technology turned into the 30-second sound byte, and that's hard. And so allowing me to go over this in a little more depth, certainly helpful for me, and hopefully for your audience out there. But as I said earlier, it's not me, there is a huge team behind me, both here in the Washington, D.C. area as well as out across the rest of the Air Force that puts this together.

And if you want to dig a little deeper or if you're out there in industry and you've got that new idea that is going to help us be more effective and more efficient, we do need to hear from you. The easiest way to get hold of us is simply going to www.af.mil.

Mr. Morales: Thank you very much for your time.

This has been The Business of Government Hour, featuring a conversation with Lt. Gen. Michael Peterson, U.S. Air Force, Chief of Warfighting Integration and Chief Information Officer.

My co-host this morning has been Dave Hathaway, partner in IBM's defense industry practice.

As you enjoy the rest of your day, please take time to remember the men and women of our armed and civil services abroad who can't hear this morning's show on how we're improving their government, but who deserve our unconditional respect and support.

For The Business of Government Hour, I'm Albert Morales. Thank you for listening.

This has been The Business of Government Hour. Be sure to join us every Saturday at 9:00 a.m., and visit us on the web at businessofgovernment.org. There, you can learn more about our programs and get a transcript of today's conversation.

Until next week, it's businessofgovernment.org.

Arlington, Virginia

Thursday, August 2, 2001

Mr. Lawrence: Welcome to The Business of Government Hour. I'm Paul Lawrence, a partner at PricewaterhouseCoopers and the co-chair of The Endowment for The Business of Government. We created The Endowment in 1998 to encourage discussion and research into new approaches to improving government effectiveness. Find out more about the Endowment and our programs by visiting us on the Web at endowment.pwcglobal.com.

The Business of Government Hour features a conversation about management with government executives who are changing the way government does business. Our conversation today is with Morgan Bantly, knowledge management coordinator in the Department of Veterans Affairs.

Welcome, Morgan.

Mr. Bantly: Hello.

Mr. Lawrence: And joining us is Miriam Browning, principal director for enterprise integration in the Office of the Army CIO. Welcome, Miriam.

Ms. Browning: Good morning.

Mr. Lawrence: Let's begin by finding out more about your agencies. Morgan, could you tell our listeners a little bit more about the VA, its roles and responsibilities?

Mr. Bantly: Well, the VA consists of primarily three major aspects. One is -- and they all are involved in providing benefits to veterans, either cemetery benefits, benefits, such as compensation and pension benefits, housing loans, education loans. And then the bulk is health care services that we provide.

Mr. Lawrence: And I know everybody could describe the Army, but perhaps you could talk about its official responsibilities?

Ms. Browning: Officially, the Army is charged with safeguarding our national interests in war and peace. This is basically a nonnegotiable contract with the American people, grounded in the Constitution.

Just to give you an example of the size of the Army, we have an annual budget of over $74 billion; approximately 1.5 million people; and we have over 180 installations worldwide.

Mr. Lawrence: And how about your careers? Miriam, perhaps you could begin by telling us about your career.

Ms. Browning: I began with the Army over 30 years ago. Actually, at Fort Ord, California, during the buildup of Vietnam. I have worked mainly with the Army, but also at the Centers for Disease Control and Prevention in Atlanta; the Department of Energy, and the Department of Defense, Office of the Inspector General. I was also very fortunate to work 2 years as the director of the Center for Management Information at the National Academy of Public Administration. So I've had a broad spectrum across both government and in a nonprofit organization.

Mr. Lawrence: And in those different jobs, what type of positions did you hold?

Ms. Browning: Predominantly jobs in information technology and business management.

Mr. Lawrence: Morgan, how about you?

Mr. Bantly: I had -- I started out working for the Department of Veterans Affairs about 20 years ago as a medical illustrator and ended up moving up through the organization in terms of managing a graphics illustration department and then managing both graphics illustration and video production, and we were producing linear video products, as well as satellite broadcasts. And then I started -- added to those responsibilities managing new media, which includes web design and CD-ROM production. So a whole gamut of media-related products for education and communication.

And in the course of that, eventually moved up to managing one of the sites that provided those services for the Veterans Health Administration, as well as overall VA, and then was involved in a lot of business reorganization activities within our organization.

Mr. Lawrence: Now, your title is -- you're described as the knowledge management coordinator. What are your responsibilities in terms of knowledge management?

Mr. Bantly: Well, the organization that I'm in directly within the VA is the employee education system, which is the main educational arm of veterans health administration and the VA. There is a smaller unit within Veterans Benefits Administration that's responsible for education. But we're -- we consist of approximately 300 employees in the employee education system. And we, about a year ago, recognized the value of knowledge management and decided that we wanted to pilot some activities in that area so that we could demonstrate the value of that to Veterans Health Administration and the VA. And we created a position of knowledge management coordinator, and I was selected for that position.

And in the past year, I've been working on three initiatives with three different communities within Veterans Health Administration to establish knowledge management strategies.

Mr. Lawrence: Miriam, how about you?

Ms. Browning: Knowledge management in the Army is in the office of the chief information officer. And basically, knowledge management in the Army is about transformation and change. So it includes not only the traditional knowledge management aspects of collaborative computing and collaborative systems, but it also includes changes in governance, in infrastructure consolidation -- we have a major effort to do that for our IT infrastructure -- as well as building up our Army enterprise portal, which is Army Knowledge Online.

And like the Veterans Administration, we also started off about 3 years ago with several pilot projects which have come to fruition and have proved very beneficial in terms of knowledge sharing and bringing the Army into the Internet age.

Mr. Lawrence: What set of skills do the people have who are doing knowledge management in the organizations?

Ms. Browning: I would say the first skill is probably organizational and political savvy. You really need to know the organization, what areas should connect, what areas are ripe for change -- that's probably the most important skill.

The second skill would, of course, be organizational and interpersonal communications. And probably the third skill would be strategic and revolutionary thinking, because knowledge management can really be used to transform and to change how an organization does business.

Mr. Bantly: I would agree with all of those. And in addition, I think for enacting a knowledge management strategy, working with people -- the ability to work with people and create a sense of commitment and enthusiasm and clearly communicate the goals and final vision of what you're trying to achieve, so you can bring that into action and accomplish that -- along with, you know, some technical knowledge, because there's technical issues involved, as well as some librarian knowledge, in terms of taxonomy and control vocabulary, and project management skills.

Mr. Lawrence: I'm surprised it took so long to list technology, given the backgrounds you both describe. Was that intentional or --

Ms. Browning: Probably not intentional, but technology is not the dominant skill in knowledge management. It clearly is an enabler, because you have to have not only a good infrastructure to be able to collaborate and to share and access information across an organization. But first and foremost, the organization needs to focus on where it wants to go and how it wants to change and then apply the technology.

Mr. Lawrence: How would you describe the development of knowledge management? As you went through the skills there, sort of skills we've heard before, but now they've been collectively organized in this new discipline, I might suggest. How do you describe the development of knowledge management?

Ms. Browning: It actually is a -- the Army knowledge management team is composed of many, many types of skills. Many that we have mentioned, plus financial management skills, human resource skills, in addition to the project management technology skills. So on any single day, on Army knowledge management, we have a group of people with that blended skill set working together.

When we first started knowledge management, it was more about providing knowledge centers. The Army has over 30 knowledge centers. Some of them have won national awards. But as we expanded that to become more enterprise-wide, to develop our portal to bring in new governance ideas and to bring in new ideas about consolidation, we expanded, not only the scope of knowledge management, but also we expanded the types of people that we need to run this -- this is a major transformation in the Army.

Mr. Bantly: I think in general, knowledge management evolved because there was a recognition in the intellectual capital that organizations and corporations had that really wasn't being tapped. And I think one of the areas of focus in knowledge management is capturing the knowledge and experiences of employees that they get on the job, that help them accomplish their work.

And when you normally think of people retiring and the organization losing the corporate knowledge that those people have, that corporate knowledge is what we're trying to capture through knowledge management strategies, and make that knowledge available for everyone within the organization.

Mr. Lawrence: Which of the positions you just described when you were going through your careers best prepared you to be a leader in the knowledge management area and why?

Ms. Browning: I think the positions that have best qualified me are those positions where I sat high in the corporate headquarters -- that is, the Pentagon, and you could look out across the Army and see the interactions and see how the organization really works.

And I've had several opportunities -- one, when I was a very junior civil servant in the mid-seventies, I was fortunate to be part of a think tank under the Army vice chief of staff of the -- the vice chief of staff of the Army. And he let all of us in his little think tank walk around with him all the time and see how decisions were made at the three- and four-star level. That gave me great insight into how the Army operates: what are the informal processes, how people get things done. And basically you learn that the skills which are really important, of course, are knowledge of the subject areas, a high degree of integrity, common sense and just good communication skills.

So I think that early knowledge of an organization can help you craft a knowledge management program, because it is not about technology, it's just not about library science, it's not about project management. It's about all of those.

Mr. Bantly: And I think, from my point of view, having a background and an experience in providing education and learning for employees, we were able to see some of the gaps that existed from the line workers in a variety of areas, whether it was clinical or administrative. And to get a good understanding of the need for knowledge sharing that exists within the organization. And not just knowledge sharing within certain areas of focus, but knowledge sharing across communities and from high levels of the organization to low levels of the organization.

Mr. Lawrence: It's time for a break. That's a good stopping point. Stick with us through the break, because afterwards, we'll come back and we'll find out how technology supports knowledge management. This is The Business of Government Hour.

This is The Business of Government Hour. (Intermission)

Mr. Lawrence: Welcome back to The Business of Government Hour. I'm Paul Lawrence, a partner at PricewaterhouseCoopers, and our conversation today is with Morgan Bantly, knowledge management coordinator of the Department of Veterans Affairs and Miriam Browning, principal director for enterprise integration in the Office of the Army CIO.

Well, knowledge management is a concept that's still rather new for many organizations. Can you describe knowledge management for our listeners?

Mr. Bantly: The way we describe knowledge management is that it's a blend of management practices and technology that provides a structured method to capture, organize, and share knowledge in a deliberate and systematic way to accomplish business objectives.

And one of the main points that we try to make with the people that we're working with and with our executive sponsors is that knowledge management focuses more on the flow of information or knowledge, rather than stockpiling of knowledge, because there's already a lot of information overload, and we need to make the information -- one of the goals of knowledge management is, not only share knowledge, but make knowledge easily accessible by the employees.

And to do that, we need to help filter that for them so they get exactly what they need when they need it.

Ms. Browning: In the Army, knowledge management is harnessing human capital, building and operating an Internet-age enterprise infrastructure, and effecting governance and cultural changes to accomplish mission objectives. And our main goal with knowledge management is to produce results. And the results that we are looking at are a number of classic knowledge-management pilots in our knowledge communities, in acquisition, personnel, finance, and in medical.

Another result we're looking at is our enterprise portal, Army Knowledge Online, which right now has 180,000, we are scaling that up to the full Army of about 1.2 -- 1.5 million folks within the next year.

And an interesting story is that Army knowledge management actually started with our portal Army Knowledge Online, about 4 years ago, when the Chief of Staff of the Army decided he wanted to talk collaboratively to approximately 300 of his general officers. And we developed a network for him. It was called at that time, America's Army Online. And we have an interactive network that the Chief of Staff used to effect decisions within the Army with his generals. And that reduced the time to many of our decisions on officer personnel management, on some high-level governance decisions in the Army. That was the basis for our portal. It has since grown substantially from those 300 people. And that's really one of the crown jewels in the Army knowledge management program.

Mr. Lawrence: How direct is the link between results and knowledge management?

Ms. Browning: In the Army, it's very direct. When we talk about knowledge management, we have developed a strategic plan that encompasses the goals that I've talked about -- the cultural goals, governance goals, infrastructure consolidation, the scale-up of our portal, strategies to improve the workforce -- especially in the IT area -- so we have very specific goal areas that we have initiatives linked to those with milestones and timelines. So the Army has put together our Army knowledge management plan in a very aggressive strategy to accomplish that.

Mr. Bantly: And as we both mentioned in our -- when we were defining knowledge management, one of the key points in both of our definitions was that it's linked to the business outcomes or business results and that's a really important point.

In terms of what we've been trying to accomplish through our pilot initiatives -- in measuring how effective that is in business outcomes, we found that to be actually a difficult area. And just as an example, one of the communities that we've worked with are patient advocates, who are the liaisons between the veteran patients and our staff. And the patient advocates are there to help resolve problems or answer questions that the veterans and patients might have.

And one of the things that we want to do with this initiative is to try to improve our customer service to those veterans and provide that information more accurately, more consistently, and more quickly across the organization. And when we came to trying to measure how effectively our knowledge management system was going to do that, in terms of linking it directly to customer service improvement, we found that it was very difficult for us to be able to do that because there are so many other factors that affect customer service satisfaction or perception among our veterans.

And so we had to -- you know, our goal is to try to link that as objectively and as directly as possible to the business outcomes. And that's going to be an areas where we're going to continue to have to do more work in trying to achieve that level of definite measurement.

But we're trying to do the best we can at this point in terms of measuring how that contributes to the patient advocates providing information more accurately and more quickly through this system of sharing knowledge. And also becoming more -- increasing their core competencies across the system, because they're very spread out, and administratively, they actually report to different types of organizations within the VA, depending upon how they were assigned that responsibility.

Ms. Browning: Let me cite also that, like the Veterans Administration, the Army also started off in knowledge management with several pilot projects. I mentioned one of them, our Army Knowledge Online portal. But there are two others that I think are worth mentioning because they did produce some results.

One was our acquisition knowledge center at Fort Monmouth, New Jersey, which has won a number of national awards. And it is a very robust knowledge center. It has all kinds of archival capabilities, message capabilities, the ability to access subject mater experts, the ability to store information, it has instant messaging, white boards, video teleconferencing, access to documents. A very, very robust center that combines collaborative computing with access to knowledge and the packaging of that knowledge.

Some of the results or some of the metrics from there were, one, we reduced the time it took to get documents to the field; we consolidated a lot of archival information and put it in one place. As you all know, if you have a big PowerPoint briefing and send it to 500 people, you can choke up the airways. However, if you put that same PowerPoint briefing in a centrally accessible file, then you save on bandwidth and it's easy for people to understand where that is.

We also did some classic reductions in cost by the consolidation of a number of our IT facilities up at Fort Monmouth in conjunction with that. So that has been a very successful pilot.

Let me talk about a second pilot. That was in our military personnel career management system. Previously this was a very manual process. At certain points in an officer's career, he was asked to make career decisions in terms of which career field he or she would like to be in. That was done by mailing out thousands of envelopes with all kinds of questionnaires that you would fill in with a number 2 pencil. We totally automated that process. We put it up on our AKO portal. We cut the time it took, we reduced all the postage costs, but most importantly, as the officers put their information in, they could also get analytical results back that would affect whether or not that would be their final decisions.

For example, if someone wanted to be a computer specialist and they put that on in their report form, and it came back that we have many, many slots and these are all being filled, the person may say, I may want to go into another area where there's more opportunities and therefore make a separate decision. So we provided analysis, cut down the time, and it was actually a -- it's a good recruitment and a retention aspect, when our people can do that online instead of the old-fashioned way.

Mr. Bantly: I was just going to add that some of the things that we've established in our pilot have been very similar to what you've done, in terms of providing, you know, quick and easy access to information that's pertinent to the work that those community members need to accomplish. And we've provided a method also for them to contribute their knowledge and experiences into the system and a process, also, for the review of those before they're actually added into the system to make sure that information is accurate in specific areas, that it conforms to VHA and VA policy and other regulations, and that there's not sensitive information in there, for example, that we don't want to share -- for example, patient Social Security numbers or any of that information or even physician names or specific employee names. And make sure that also, descriptions of how people can do things -- accomplish things faster and more efficiently -- are written up so that they can be repeatable, and they're not, you know, missing an instruction that somebody assumes when they write it, but when somebody else reads it, they realize that there's a step missing that they don't quite understand.

So we want to make sure that the knowledge assets are really consistent, accurate and complete before they're entered into the system. And also, we have a bulletin board system for announcements so we can get information out quickly to all employees. We have an expert director so that we can connect with experts in different areas throughout the VA.

And also, there are other processes in addition to the portal aspects that we have incorporated as part of the knowledge management strategy, in terms of getting more sharing of information between people. And that is through other activities like conference calls, you know, audio conference calls, video conference calls, through satellite broadcasts and educational instruction that we produce that are distributed in that manner and through face-to-face meetings.

So we're documenting those kinds of collaborative activities that are occurring, also, in trying to measure the effectiveness of our knowledge management strategy on sharing information.

Mr. Lawrence: That's a good stopping point. Come back with us after the break and we'll ask our guests more about the challenges of implementing knowledge management.

This is The Business of Government Hour. (Intermission)

Mr. Lawrence: Welcome back to The Business of Government Hour. I'm Paul Lawrence, a partner at PricewaterhouseCoopers, and our conversation today is with Morgan Bantly, knowledge management coordinator at the Department of Veterans Affairs and Miriam Browning, principal director for enterprise integration in the Office of the Army CIO.

One of the things we talked about in the last segment was the role of technology in knowledge management. Is technology robust enough to handle what's going on in knowledge management now?

Ms. Browning: Generally, yes, I think the technology is very good. It's a matter of making sure that you have an infrastructure that is capable of providing information access to all the members of the organization. And I think it's there, but there are a lot of areas, still, that we are working on. Let me just give you three examples.

One of the issues, of course, is Web mail. We're struggling with that right now in the Army. As you know, there's a difference between Web mail and client server mail, which is the typical Microsoft mail that you have. And the typical Microsoft mail is very robust in terms of providing you a calendar and the ability to move a document in there, et cetera. Web mail does not have that capability. And for those of you, of course, who have, you know, an Internet account commercially, you get access to people's e-mail with all the full range of functions that are there and in Microsoft you don't have that. And the technology really doesn't exist today in the commercial marketplace for a full robust Web mail.

So as we look at providing universal e-mail for all 1.5 million Army people, we are probably looking at this stage at a hybrid. Some will have Web e-mail, some will have full robust client server e-mail. So this is one technology issue.

The second issue, of course, is the last mile communications to remote sites. The Army has remote sites all over the globe. And we have very robust long-distance communications lines to the major hubs, but it's getting that last mile to the desk of the PFC in let's say, at Fort Polk, Louisiana and making that robust enough to go into the Internet and access our portal, which is an issue.

Now, it's not only an issue within the Army or the Defense Department, it's also an issue globally. I read the other day that only about 6 percent of American homes have high-speed access to the Internet. So this is something that everybody is working on. So we struggle with that, because it's an information access issue.

The third issue, of course, is information security. And that is especially becomes exacerbated with the proliferation of wireless devices. So the Defense Department continues to work on its defense in-depth strategy to make sure that we don't have any security breaches and we are also working with manufacturers with many of the wireless devices to make those devices a lot more secure.

But technology continues to evolve. I think you can start a knowledge management program clearly with the current infrastructure. The ideal infrastructure is not there, but those are issues that everybody faces for all kinds of applications within the organization.

Mr. Bantly: I agree with those, especially the point about being with access, for example, and with the security issue. For example, some of the communities that we're working with in the VA are going to require or want to have access to be able to provide access to extended community members that are outside the VA. And so there will need to be security issues around allowing community access to the information and knowledge that we've got internally. And that's -- we have people now working on providing patient record information to, you know, the patients that those records belong to so that they could access those records from outside the VA and get the information that they want to see about themselves without having to go through the VA to do that.

And that same technology or processes that are established to do that, we could apply to our knowledge management practices as well, in terms of providing that knowledge to people outside the VA.

Another issue that's related to the technology, but it's not -- I don't really see it as a technology issue at this point, and that is -- is really managing the knowledge the maintaining accuracy and currency in the knowledge. And the technology brings the knowledge to the fingertips to the knowledge, but we need -- another really major issue is to make sure that that knowledge is accurate and current.

And so there are a lot of issues around maintaining that and managing the -- that process that I'm really interested in and learning more about. And I think that the field has -- there's still a ways to go in that area.

Ms. Browning: There's also an interesting cultural aspect of information access. Typically, in any organization, there are areas that say my area and only my area can have access to this information. And if it is not a privacy or a security issue, which it frequently is not, then the question becomes, well, why can't everybody have access to it?

So it gets into the issue of knowledge is power and how people hoard knowledge. But I think one of the cultural changes that knowledge management forces, it forces us to review what kind of information we give to everyone. Again, that is not bounded by privacy or security issues.

So I think we're seeing more and more in the Army a real desire on the part of top leaders and we're beginning to see this in the middle management of people loosening the grip a little bit and providing information to the entire organization, but this does not come fast.

Mr. Bantly: Another issue related to technology, also, is establishing metatagging standards so that -- and that's the data that describes the knowledge chunks. And some of that data can describe, for example, copyright issues. So that that would enable people to determine to the extent to which they can reuse those assets in other ways. And that's an issue where, although there are standards that exist that have been developed by international standards organizations getting the vendors to incorporate standards in their products and even agreeing on standards between government agencies is still something that needs to be done.

Mr. Lawrence: Well, this was just -- you also just hinted at some of the organizational changes. Well, how does knowledge management affect corporate culture?

Ms. Browning: I think knowledge management has a good effect on corporate culture because what it does -- it evokes a different type of organizational model. One where you have more emphasis on including more people in the decision-making process, working in teams, I think that is becoming more and more the norm. Whether that's actual teams or virtual teams. Also, more of a constant learning and educating people on what are the concepts, what are we doing, what is the project management.

Within our own Army CIO office, we have started professional development sessions at our biweekly staff meetings. So not only do we find out what's going on, we also pick a topic and inform and educate people on that. So it's an opening up, if you will, of the cultural channels in terms of how we do business.

I will tell you, also, you say, well, how do you spur that on? How do you incentivize that? It was probably not a coincidence that the people during the last -- this performance appraisal cycle who got the highest awards were those people who were leaders in the knowledge sharing and in some of these changing cultural aspects. So those are the aspects and you do have to reward the people who are the early adopters and who want to do that.

Mr. Bantly: I think what a knowledge management strategy does is, it kind of turns on its side the initial tradition of having more of a top-down management approach to accomplishing business objectives, where managers determine what needed to be done and then they delegated responsibilities to others to accomplish those objectives.

And what this does, I think it brings more authority to the line workers to recognize and to advocate certain changes that meet certain goals and directives that management would identify. So the community leader identifies or sets the direction for the community. And then it allows the community members to come up with the solutions to achieve the business outcomes through, you know, to accomplish those goals.

Mr. Lawrence: Skeptics have suggested that knowledge management is difficult to implement. What have been your lessons learned that you might share with others?

Mr. Bantly: I think that, just to name a few areas off the top of my head, where there's -- where there's some difficult in establishing these.

First of all, it is very important, it says this in all the literature, and from experience, it's true, as well, from what I've observed from, not necessarily within the VA, but from other organizations, is that it's absolutely important to have corporate sponsorship or management sponsorship of those activities to get the commitment of all the others to allow the -- to provide the time to support those activities.

And I think to a lot of people, knowledge management is a confusing topic, and it's somewhat an abstract topic. And they don't -- it takes them a while to understand what that means and what the impacts will have on how they do business and how they will operate, because it is a changed behavior.

And so getting that understanding to the workers that you're working with, because you work with the community members to help design the strategy for the way they would use it to accomplish business objectives, is a little bit of a challenge.

Ms. Browning: Very simply, here's some advice. First, develop your own definition and your own political ends for knowledge management. Then weave it into the fabric of the organization, especially in organizational transformation. Obtain executive support; that's very important, and it's not just, okay, we'll do it. It almost has to be a visceral buy-in, a real active buy-in by the leadership.

And then develop a strategic plan with milestones and implement for results and hold yourself accountable. So it's like many other transformation efforts. Understand where you want to go. Use knowledge management in this case. It's sort of a buzzwordy thing, but kind of use it to get where you're going and then forge ahead.

Mr. Lawrence: Good stopping point for this segment. We gotta go to a break. But when we come back, we'll ask our guests to tell us their visions for the future of knowledge management.

This is The Business of Government Hour. (Intermission)

Mr. Lawrence: Welcome back to The Business of Government Hour. I'm Paul Lawrence, a partner at PricewaterhouseCoopers. And today's conversation is with Morgan Bantly, knowledge management coordinator at the Department of Veterans Affairs and Miriam Browning, principal director for enterprise integration in the Office of the Army CIO.

Well, how will knowledge management help the government with the impending retirement wave?

Ms. Browning: Knowledge management can be used to capture both the explicit and the tacit information of the workforce so that new workers coming in can shorten their learning curve. We have actually done this in the Army through the development of a template that we have used both within the Pentagon and at some of our field organizations to do that. Where you can capture lessons learned, how to get to documented sources, who are the subject matter experts, where are some -- how to define a certain process, where archival material is.

And actually, in one of our case studies, we found that we really reduced the learning curve of a typical staff officer in this office in the Pentagon from about 6 months to about 2 months. So that was -- that was very helpful. I think, though, the larger construct of knowledge management as part of transformation, no only in the Army, but within government, will also be from a long-range perspective. I think the better legacy of knowledge management, it will make the government a more attractive place to work -- being more high-tech, being more close to how business is conducted in the private sector.

So I think it's that long-range aspect of knowledge management that will prove beneficial over the years.

Mr. Bantly: I agree. I think it's -- you can see it in our organization, in terms of relatively long-term effects in terms of getting all the portions of the VA more unified and consistent in access to information that they have.

And then, also, government agencies, as well, so that we become more of one network and the work of all the employees becomes much more efficient and in accessing, you know, the information that they need, because they're sharing information rather than duplicating efforts and recreating the same kind of information in different places.

Ms. Browning: It's very much an expectation issue. If young folks know in their private lives that they can access all kinds of things on the Internet. If people know they can do that in a private sector job, the expectation is that that should be the same in the government. So I think knowledge management helps move the government toward that direction, which is good.

Mr. Lawrence: What advice would you give a person contemplating a career, whose perhaps thought about public service and maybe even is interested knowledge management -- what advice would you give such a person?

Mr. Bantly: My general advice is that they -- I think it's beneficial to have a perspective from a variety of topic areas or subject areas. Because you can bring experiences in seemingly unrelated areas -- you can bring those to other areas in more innovative ways. And I think that's a key way to create more innovation is to recognize similarities between what normally people would thing of very different areas of concern.

And, obviously, computer literacy, which I think is something that more people are getting involved with technology that's being developed. And I think communication skills is another key area in working with people.

Ms. Browning: The best reason to go into government, of course, is because of the challenging work -- there are jobs in the government that are absolutely unique and nowhere else in the world. So it's that challenging work and the ability to contribute to the nation. I think people who have that first and foremost in their minds will be the ones that really should go into government.

Clearly, also, the government is also good in terms of relative job security and benefits, so I think that that's an aspect that should be emphasized.

If someone wants to make a lot of money, I recommend that they do not go into the government. That's a personal decision. There are all kinds of people out there and, certainly, this nation holds employment opportunities for many.

I would also suggest that people interested in the government pursue some of the higher-level skill sets, such as, business skills and leadership skills. Because in the information technology area over the years, more and more of the technical skills will be outsourced. We have seen that trend in the Defense Department for decades, that will continue. So that we will need people in the government who are generally very highly educated, who understand business, the organization, and the leadership skills so that they can manage contractors, manage large horizontal projects, not only within their agency but, as Morgan has mentioned, across agencies. So we're looking at some really, really high-level skill sets and some absolutely fascinating work.

Mr. Lawrence: How do you think knowledge management will evolve in the next 10 years at each of your organizations? What's your vision for the future of knowledge management?

Ms. Browning: I think a lot of knowledge management tools and processes that we have right now will become embedded in normal business processes. Very similar to business process re-engineering. You know, in any process re-engineering endeavor, you can include knowledge management components, such as lessons learned, or best-practices, access to subject matter experts, knowledge templates, common archives, et cetera.

So I think that will become part of how we build applications, how we do business. I think that it will become common place.

Let me add one more item too. I think one of the -- some of the cutting-edge areas in knowledge management will be in the use of intelligent agents. We see them already on the Internet. Agents that help us make decisions. Agents that are intelligent agents that are embedded into how we select things and actually how we buy things on the Internet. You can weave those into how we perform processes and how to reduce the cycle times.

I also think that you will probably see a blossoming of some of the newer management concepts in the federal government. More self-service applications, you know, people can do more things online. There is still a gap between government and the private sector, in terms of simple things, like access to your benefits. Filing travel vouchers, it varies by organization. But in the private sector more and more of these things are absolutely automated.

I think you'll see more virtual teaming, more knowledge repositories, more knowledge portals, so there really will be a blossoming of a knowledge generation, not only in the government, but in the private sector.

Mr. Lawrence: Do you think our concern for privacy will impede knowledge management? It seems as though we're always walking a fine line between having a lot of information to do the things you just described, but yet not wanting to have a lot of information out there?

Mr. Bantly: I think the desire to -- for the access to information, actually, is going to drive knowledge management more than impede it. And I think that it will help others focus on defining how they can provide, you know, what the limitations will be to providing certain information -- allowing certain information to go to people that need it and keeping, certainly, private information private and only available to those who should have access to that information.

Mr. Lawrence: And how are the economics of knowledge management working out? Often the benefits are long-term and the costs are immediate, and that sometimes limits people's desire to go forward with things.

How are the economics being worked?

Ms. Browning: That's a classic technology problem, and I think one of the best things to do is what both Veterans and Army have done, and that is to start small and demonstrate with pilots. In other words, you need to put in a strategic long-term program, but as you're doing that, you must have some very short-term pilot projects that can produce results and that can gain organizational commitment to continue.

So that's typically how you go about instituting a change using information technology.

Mr. Bantly: I think a key part of that is identifying the communities and the goals that you're trying to accomplish through knowledge management. I think some things can be much more easily and directly measured. And I know that in some corporations, for example, some have set a limit to actually working on a knowledge management project. They won't work on one unless they can expect to receive a profit within 6 months from that initiative. And I've -- I'm familiar with cases where that's occurred and they've been able to demonstrate that profit through measurable, you know, through measurements.

I think within our initiative, that it's going to require more of a long-term effort to see true benefits because a lot of this is through organizational change. And we need to develop this and establish this more strategically across the entire organization.

So to see larger benefits, it's going to take a longer time before that's actually realized. I think in terms of trying to achieve the executive sponsorship to establish or continue to provide initiatives that use knowledge management. I think, like Ms. Browning, was saying, that, you know, you just need to identify ways in which you can accomplish that quickly and then be able to verify that so you can demonstrate value and continue to go forward with those initiatives.

Mr. Lawrence: Well, this is a good stopping point. Miriam and Morgan, I want to thank you very much for joining us this morning. This has been a great conversation.

Ms. Browning: Thank you, Paul.

Mr. Bantly: Thank you for inviting me.

Mr. Lawrence: This has been The Business for Government Hour, featuring a conversation with Morgan Bantly, knowledge management coordinator of the Department of Veterans Affairs and Miriam Browning, principal director for enterprise integration in the Office of the Army CIO.

To learn more about the programs and research, visit us on the Web at endowment.pwcglobal.com. And at this website, you an also get a transcript of today's fascinating conversation.

See you next week.