The State of e-Government

This week I attended the National
Electronic Commerce Coordinating Council
meetings in Boise, Idaho. 
The theme of the conference was “Government in the Digital Age: Myths,
Realities & Promises – A Candid Assessment and Road Map for Success.”

(I went on behalf of the E-Government Executive
Education (3E) Project
at Harvard’s JFK School of Government (KSG), where I
am working with Professor
Jerry Mechling
to develop a new online application called the Compass.  The Compass, built on .LRN with the support of IBM, includes
assessment, benchmarking, and library tools which will support both the 3E
Project’s executive education programs, and perhaps later other KSG and other
programs.  We showed an early version of
the Compass to 25 execs gracious enough to give us their time, and their
response and feedback were both encouraging and useful.

The first “production” use of the Compass prototype will be
for a 3E program we’ll be running in December called “Leadership in a Networked
World: The 2005 Leadership Agenda”.  The
purpose of the program is to help senior public sector executives and their
advisors evaluate and set priorities among IT-enabled initiatives, not only in
light of their potential value, but of the political calculus associated with
them as well.  After choosing a few to
focus on, the program then considers how best to pursue these priorities given
their associated political considerations.)

Conferences can be a mixed bag.  This was a good one.  The participants included current and former
state comptrollers, auditors, and CIOs. 
Vendors were represented by very experienced folks who had themselves
been in the roles of the government participants and were well-known and
respected.  So in addition to a very
collegial feeling there was little of the awkwardness and stiff hype that’s
typical of other vendor-customer interactions.

I’d never been to Idaho
before.  Boise
is a nice town, with some attractive architecture (state capitol, churches) and
some incredible views.  There’s a really
good, inexpensive Basque restaurant called Bar Gernika across the street from
the Grove Hotel where Jerry and I had lunch (lamb-dip sandwich: good) and Dan
Combs and I had dinner (lamb stew: great). 
Apparently you can fish in the river that runs through town, though I
didn’t get to try that.  And of course it
took me a bit to adjust to saying “how-do” to passersby, and to wait to cross
until the light said I could.

Here’s some of what I heard and learned (not necessarily a
faithful transcription of what people said, presented, or intended).

Wednesday morning’s plenary session was keynoted by Peter
Harkness, the editor and publisher of Governing
magazine. His theme: the e-government revolution hasn’t really happened
yet.  My notes:

  • E-government hasn’t affected costs yet.
    • From 1994 to 2003, the number of federal employees has shrunk from 2.2
      million to 1.95 million, but this masks outsourcing to consultants
    • Over the same period, total employment by states grew from 4.6 million
      to 5 million, and local public sector employment grew from 11.7 to 13.8 million
    • (I
      checked: US population grew 16%, or from 240M to 280M from 1990 to
      2000.  Per capita, we still have roughly the same number of
      government employees we used to.)
    • So e-gov has not reduced costs, even though “online v inline” is
  • The revolution requires integration
    • Technology isn’t the obstacle
    • Organizational balkanization is the real problem
      • The exception that proves the rule is the military
        • We’ve seen the power of network-centric warfare
        • The real enabler is the elimination of inter-service rivalry in the
          conduct of warfare
    • Balkanization exists in many places in government
  • Among local, state, and federal, but also within agencies and branches
    of government at each level
  • Politics impede integration
    • Here’s an example of how it’s made worse:
      • Sophisticated parties + redistricting = primaries, not general
        elections are the actual places that public officials get selected with no
        enduring commitment to a moderate middle; add term limits to the mix and
        there’s little time to do the relationship building and horse-trading based on
        trust that allows room to get things done.
    • Here’s another example of how the “Politics of Policy” are dividing
      feds from states and locals:
      • FDA doesn’t want to allow importation of prescription drugs from
        lower-cost places like
        having been persuaded by the pharmaceutical industry that the practice is
        unsafe for consumers.  But Montgomery
        County, MD, where the taxpayer
        pays a prescription drug benefit for 80k retired public workers, says they
        are.  And in an era where federal
        non-defense discretionary spending is eclipsed by the size of the annual budget
        deficit, federal ability to influence local practice with funding is
        diminishing.  So incentives to cooperate
        on systems to ensure optimal use of drugs by seniors and other beneficiaries
        are also reduced.  We also see this
        adversarial relationship in homeland security efforts
      • State AG’s have been suing investment banks, mutual fund companies,
        pharmaceutical firms, utilities & auto manufacturers, and have found
        themselves in court fighting not only these organizations but the federal
        government as well (e.g., California’s attempt to impose fleet mileage
        requirements in the state)

At lunch later that day, David Lewis, formerly the CIO of
Massachusetts, gave me an example of the as-yet-unfulfilled promise of
e-government.  David observed that a
really useful thing would be for DHS case workers to be able to enter some
parameters that describe a particular person’s or family’s needs, and then to
have that “filtering” return a list of all of the relevant benefits  available to that situation from across 600
-plus programs offered by over 40 agencies. 
He noted that the obstacle to this isn’t really technical, but the need
to reconcile the words and languages that agencies use to characterize
eligibility and relevant benefits. 

Obviously this is a challenging thing to do.  I offered that maybe one approach would be to
complement traditional top-down reconciliation with a grass-roots “social entrepreneurship”
approach.  This would entail a motivated
20-something grabbing some free software to build a demo, then getting a small
grant to pay some moonlighting case workers and program staff to do an 80-20
cut at translating a significant subset of program eligibility requirements and
benefits to some formal or de facto standard.  It might only take three months, six at the
outside, to have a reasonably useful tool. 

Later in the afternoon, I attended a very interesting
presentation by Glen Teal, who is the Portfolio Manager for Citizen &
Customer Services for the Manukau City Council in New
Glen was in the US
at the invitation of Peoplesoft’s J.D. Williams, formerly the Idaho
state comptroller (and a very wise and charming man).  His presentation was a thorough and
well-organized story of how they had implemented CRM software to permit the
consolidation of service interfaces with citizens across a number of different
agencies, which then permitted the selective outsourcing of the fulfillment of
these services to private firms under different contracting schemes depending
on how well-developed pre-existing markets for these services were. 

Two lessons from his talk: first, never outsource
relationship management with constituents; second, don’t try to create markets
to outsource to where none previously existed. 
So, on the latter point, it makes no sense for the government to do engineering
services because the private sector has a healthy market for this that can be
relied on.  However, private-sector dog
catchers mostly do not exist in nature. 
Outsourcing this function inevitably leads to consolidation of an
initially fragmented mom-and-pop market by enterprising ex-public sector
execs.  Once they achieve duopoly or
something close, the government is at their mercy:  pay or it’s “Release the hounds!”.  More politely, Glen called it “market

The theme of opportunities from consolidation, and the
structural barriers to it, wove its way throughout a number of conversations I
had.  In the hallway between sessions,
David Lewis and I chatted with Brian Ridderbush from Unisys about how Medicaid reimbursement
rules encourage states to each develop their own benefit structures, which
means perhaps $18 billion in additional expenses for variations in related
claims processing systems.  Is the
variety worth it?  I think we’re unlikely to find
out.  The federal money is now allocated
in the form of block grants as part of the overall trend toward
devolution.  So the feds can’t prescribe
any rationalization.  The feds reimburse
the states for 90 cents of every Medicaid dollar they spend, so the greater
cost of variety is not a place states focus on to save money.

Dan Combs, who was Iowa’s
Director of Digital Government, gave me another example of this at dinner.  He described how in Iowa
there were 99 counties.  The seat of each
was located, when the state was established, at a distance of a day’s ride from
the next.  Horses typically traveled
about 30 miles a day in 1850, so Iowa
has lots of charming but subscale local governments in the era of the
automobile.  Does Iowa,
with a population of 3M, really need 99 county governments?  Maybe not, there’s
some advantages and a lot of tradition in their favor.  I
guess it depends on what Iowans feel they can afford.

I talked with a couple of legislative auditors about how the
part-time nature of many state legislatures affects the continuity and will
they need to initiate and sustain major change that consolidation
requires.  They noted that the pool tends
to be limited to people who don’t typically have a lot of inclination or
experience with the management of large organizations.  Frequently, legislators are attorneys whose
firms can cover for their absence while they serve in ways that also indirectly
advance their firms’ interests.  Or, they
are wealthy ranchers who can spare three months while the snow covers their
fields.  This means part of the challenge for the
bureaucrats is to try to educate legislators on what’s going on and how to deal
with it effectively.  But as one put it
to me, “It’s sort of like trying to teach a pig to sing:  it’s not very effective and it annoys the

So what’s a government to do in the face of all these

One move is to de-emphasize new technology as the panacea.  Pam Ahrens is CIO of Idaho.  Idaho
has been creative and ahead of the curve on e-government issues, but Pam noted
that these days especially it’s people and not technology that’s on the
critical path to change.  So Idaho
is de-emphasizing R&D for S&C – search and copy – while they focus in
on people issues.  After all, she notes,
“Pioneers get killed, settlers get rich.” 
I had the strong sense as a visitor from Back East that I ought to take
her word on this.

Another approach is to “zero-base” government.  California
seems to be pursuing this more radical approach.  Governor Arnold is quoted as saying in the
course of commissioning the California Performance Review, “I don’t want to reorganize
the boxes, I want to blow them up.” 
Echoing this theme is the approach Michael Bloomberg is taking in New
Accenture’s Ken Dircks, who is a leader in the firm’s 311 engagement
with New York City, told me
Thursday night about Hizzoner’s takeover of the New York City Board of
Education.  On hearing an explanation of
why change would be tough to implement through a multi-tiered bureaucracy, the
mayor simply ordered the physical buildings of an entire layer of the bureaucracy
padlocked, effectively cutting “management” in this layer out of the process
and forcing a higher layer to deal directly with schools.

Well now.  But part of
me feels it’s insufficient.  Colin
Powell’s “Pottery Barn” rule likely applies here as well — “You break it, you
own it.”  So part of owning it is showing
the way ahead.  And a general principle I
believe in is that people are better at reacting than acting.  Show them something real they can try out and
use and you’ll have more impact than if you describe it to them in principle.

Maybe open-source software can help make this
experimentation more feasible and affordable. 
Friday morning I attended a session on open-source in government.  The format was a debate between Daniel
Greenwood from MIT’s Ecommerce Architecture Program and Stuart McKee, former
Washington State CIO and now a government-sector “evangelist” at Microsoft
(“advocate for Microsoft to the public sector and vice versa”).  Is open source ready for government, and vice
versa?  I won’t summarize the discussion,
except to say of course that it depends on the specific need and the specific
open-source project under consideration. 
But I did find a few recent, interesting articles on Microsoft and
open-source in government.  Reading them
I’m reminded of Gandhi: “First they ignore you, then they fight you, then you

  • “Microsoft is expanding a program to give government organizations
    access to some of its tightly guarded software blueprints amid growing
    competition from rivals who make such source code freely available…” Wired
  • “Microsoft chief executive Steve Ballmer told resellers at the European
    Partner conference that anyone in danger of losing business to Star Office
    should email him and he would send in the cavalry…” The

next NECCC annual meeting is in Boston
next November.

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