egovernment’s new imperatives governor jim geringer may 29, 2002

eGovernment’s eGovernment’s New ImperativesNew Imperatives

Governor Jim GeringerGovernor Jim GeringerMay 29, 2002May 29, 2002

This Presentation is about…

• Tight Budgets

• Big expectations

• State $ have decreased

• But Fed $ in high cost areas have increased

• Don’t forget local government

• Resource problems that may be only allocation problems

eGov: Who really “gets it?”

Have we properly defined Digital Gov?• Centered mostly on transactions• eGov increases productivity, but does it

affect service results?• Value added services• Performance based budgeting• Enterprise approach• Functional integration• Investment model

Bringing it on home

• The New Economy is about productivity and innovation

• eGov must do likewise to meet citizens expectations about access and quality

Great Expectations

• States and locals are in difficult financial straits• Reduced revenues• Medicaid costs up 14% this year, 9% next;

employee health insurance is up another 30%• Increases expected by P-16 Education• Public assistance costs could increase with

reduced employment • Big buildup in Homeland Security

Fiscal Outlook for the States

• Fiscal 2002 enacted budgets were reduced in thirty-nine states by approximately $15 billion— 20 states more than in FY2001

States' Year-end Balances

$39.5

$24.5$18.3

7.84.8 3.5

$-

$10.0

$20.0

$30.0

$40.0

$50.0

Billions $39.5 $24.5 $18.3

% of Expenditures 7.8 4.8 3.5

FY 2001 FY 2002 FY 2003

-$15B

-$6.2B

Federal Increases in Education

• Reading First $ 1.0B

• Teacher Quality $ 9.0B

• Accountability $ 0.4B

• IDEA $ 1.3B

• Title 1 $ 1.8B

TOTAL $14.5B

Source: www.whitehouse.gov, www.nochildleftbehind.gov

BioTerrorism

• $4.3B in Budget Request

• Much of the focus of the BioTerrorism grants is on building capacity through Public Health, hospitals, labs, surveillance

• Medicaid and other health services are enhanced as a result

Homeland Security

• $10.6B in FY02, $18.2B in FY03

• Some of the Possibles that states might consider to leverage other program benefits– SmartCards: Benefits transfer to clients– Public Safety Networks: First responders, lower

costs to local governments– Integrated data bases– Security against cyber terrorism helps all security– GIS (more than maps – Interrelationships)

• Education

• Homeland Security

• Medicaid

• Increased federal dollars allocated for each of the above exceed the $15B reduction incurred by the states in 2002

More Obligations, Less Money?

or is it an allocation problem?

What happens to IT Budgets?

• 50 States, 3200 counties, 19,000 municipalities

• Could IT be a ready target for % reduction?

• Is IT integral or an add-on?

• How do you calculate IT costs? Benefit?

Challenge of ChangeHow well informed are government executives on IT issues?

CIO’s

CEO’s

AgencyDirectors

Executive Oversight and Budget Personnel

Legislative Bodies

0 50 100

86%

45%

36%

28%

7%

Source: JFK School of Government, Harvard University

How Does Digital Government or eGov Mature?

• Web presence– Passive displays, agency specific

• Interactive web– Hot links, still mostly gov by agency

• Transactions on the Web– Highly interactive, prompts, function portals

• Imbedded technology and Interactive Web– Enterprise interactivity– Service enhancement– Data driven results focused; not just process– Economic and business partnerships

Much of Government is Transaction Centered

Price ofGovernmentServiceTransactions

Legal &Regulatory

InformationSeeking &Gathering Inventory

Payments

Logistics&Procurement

Benefits and grants

Cost of Teller Transaction

$1.50

$0.30

$0.01

1985(Bank)

1995(ATM)

2000(Internet)

Length of Time to Execute a Long-Term Gas Contract

9 months

2 weeks

< 1 second

2-3 years

1981 1989 1997 2000

eGovernment: Business Transactions

• Business and tax Forms on line– Downloadable, mail in– Web interactive, real time

• Electronic Payment– License, permit, registration, taxes, utilities– EFT or credit card

• Records storage and retrievalSource: Digital States 2001 Progress and Freedom Foundation

Social Services Transactions

• Benefit application forms on-line, preferable web-interactive

• Client history and contact available through email or web

• Job Search and application• Smart cards for benefit distribution and

client history• Child support payment and enforcement

Source: Digital States 2001

Public Safety TransactionsLaw Enforcement and Corrections

• Digital wireless statewide network– Interoperable communications

• Data entry and retrieval– Traffic queries, reports– Crime investigations

• Tele-– Health– Depositions

Source: Digital States 2001

Judicial Transactions

• Integrated data systems with law enforcement, social services

• Court decisions on line

Source: Digital States 2001

Legislative and Elections

• Bill Status, text, amendments, history

• Election – Requirements– Returns

• Contacts

Source: Digital States 2001

Technology Enables Productivity

BarterEconomy

Creation of Money

Industrialization,Transportation &Communication

Internet &InfoTech

1300’s

1800’s

2000’s

Specialization& Firms

Integrated, HierarchicalFirm

“VirtuallyIntegrated” FirmOr Government

InteractionCosts

Time

Transactions can be reduced or eliminated – that saves $

butHave you added value to the

service or only saved $?

24/7 has shifted the responsibility for transactions from government to the client or customer. Value through convenience

What Value does your agency add?

• Value time divided by elapsed time• Value time is the amount of productive

work time• Elapsed time is from the time work starts

until the time it’s finished• Ideal ratio of VT/ET = 1• In a typical organization, value added is less

than five percent

Source: (Dr. Michael Hammer to NGA Aug 2001)

Reallocating Resources

• The solution lies in eliminating non-value added work, which only adds costs, errors, delays, and inflexibility.

• Current employees can be moved to higher skill and value areas

• Processes can be redesigned or eliminated• Embedded Technology is the enabler, data

is essential

A Technology Solution must deliver value or benefit

•Technology by itself does NOT deliver benefit•Technology enables process transformation which may deliver benefit at lower cost or better quality

Understanding IT is as hard as Understanding Performance

• 26 states resorted to across-the-board cuts to balance their current year budgets

• Only 10 states chose to make program changes

• Why aren’t performance budgeting and enterprise management used more effectively?

• Standard Budget: Resources needed to – Perform the same work or– Deliver the same services

Managing for ResultsFifteen years later

• Performance Based Budgeting was widely popular, then pushed into the background when state revenues were flush

• Agencies now are being asked to justify increases or even to take less money

• Agencies often don’t know a program’s full cost, how to integrate annual performance plans with budget justifications or even how to measure or evaluate performance

Enterprise approach to managing state government

• Data-driven evaluation of results is essential to performance evaluation but impossible without technology

• How should states apply technology to collect data – real-time and over time ?

• We are overwhelmed with data. What we need is data that can enable or inform decisions, especially in budgets

• How will you justify substantial increases without measurement of results?

Local Government to Feds, States:

No More Mandates

• Tell us what you want to achieve, not how to do it

• Give us flexibility, we’ll give you accountability

• Who sets performance criteria?

• Mayors, governors, CIO’s, legislators, agency folk all have to understand the value of shared responsibility and functional management

• Functional areas don’t follow agency boundaries• Enterprise management is essential• Continuous improvement is a necessity• Frequent “reinventing of government” is a sign of

poor strategic thinking and a route to mediocrity

Dr. Michael Porter, Harvard Business Review

Technology is the easy part

You have to change an entire culture

Who Moved My Cheese?

• Change Happens– They keep moving my cheese

• Anticipate Change– Get ready for the cheese to move

• Monitor Change– Smell the cheese often so you’ll know if it’s

getting old

Spencer Johnson, M.D.

“The best way to predict the future is to create it.” -- Peter Drucker