The American Technology Council (ATC), founded by President Trump in May , published its draft Report to the President on Federal IT Modernization in August and opened the floor for public comments and input. The report followed two previous Executive Orders focused on Executive Branch reorganization and cybersecurity and the role of shared services in each area. Expanding and strengthening adoption of shared services—from apps to infrastructure to cybersecurity—was a key theme of the report.
“In order to reduce cost, improve operational efficiencies and cybersecurity, the federal government must shift toward a consolidated IT model. This includes adopting centralized offerings for non-mission specific functions by default, and should comprise commodity IT, such as email, productivity, collaboration, and security tools….The Federal Government must embrace the broader use of cloud services while working to develop cloud products that meet Federal cybersecurity standards…. Agencies must leverage shared services and embrace commercial technologies where possible, building new capabilities only when shared services and commercial technologies cannot meet mission need.”
On December 12, 2017, President Trump signed into law the Modernizing Government Technology (MGT) Act, which was included in the 2018 National Defense Authorization Act (NDAA). The legislation authorizes investment to modernize technology across the federal government through both a government-wide modernization fund and working capital funds in each major agency. It’s clear that momentum is building for wide-scale adoption of a next-generation approach to resource sharing across the federal landscape.
Shared services is not a new idea; since the 1980s, it has been used as a strategy for consolidating back-office functions, previously performed in many sites, in a single, low-cost location. The focus was largely on cost reduction.
Today, cloud computing and virtualized environments are changing the potential of shared services. Certainly, there are additional cost savings and productivity gains to be gleaned, which remain priorities as belt-tightening continues across many agencies. Further, shared services can open the door to more effective government services and mission execution—in other words, they can promote greater flexibility and true process transformation in a time in which the administration is focused on streamlining government and introducing private-sector best practices and values.
Shared services is a proven strategy; however, in many cases, its true potential is far from realized. One element of introducing and managing shared services that is often overlooked completely or given only a cursory nod is organizational change management (OCM). Usually, it’s not the technology that trips up organizations on their journey to shared services, it’s the people side—organizational design and governance as well as cultural and process evolution. Changes in roles and responsibilities are hard—agencies and individuals often fear loss of direct control and accountability, and are unsure how to succeed in the new business model.
How can agencies incorporate OCM to ensure they succeed? The first step is acknowledging its importance and scope in a shared services initiative. Second is to build on knowledge and lessons learned from partners who have traveled the road before. In other words, be sure to take an experienced guide through this new terrain. Agencies should look for a partner who is not only experienced with the technology but who has also orchestrated the organizational change management required—specifically in a public sector organization environment.
The team also must place the end-user at the heart of the service and process. The end-user must be the starting and ending point for the entire journey, and every touch point must be defined and addressed to ensure success. For example, during the process of HR onboarding, a new employee may have 12 touch points with three different people. An agency should map the complete journey for the employee to make it as easy as possible to navigate. This must include frequent and effective communication about the process, data collection about the employee’s experience, analysis of bottlenecks or process breakdowns, and identification—and implementation—of fixes.
Finally, agencies must understand that their vision for shared services will continue to evolve over time. Today, many organizations are exploring shared service models that integrate service delivery for several mission-support business services. Next-generation models range from an IT services partner managing systems at an agency’s data center to a service provider partner delivering multiple business services based on a price per transaction. The vision might even include an agency and its partners becoming a service provider for other agencies.
With a growing focus on efficiencies and service improvement, agencies need a roadmap to successfully navigate their shared services journey. What approach makes the most sense for each agency today and the future—building and operating its own shared services center; becoming a customer for another agency providing services; turning over business process management to an external partner; or a hybrid of these approaches? And, do we want to operate shared services only for our agency, or is our vision to provide these services to multiple agencies?
An experienced partner with proven success stories can help agencies discern the answers to these questions and many more.
NASA, for example, is successfully leveraging shared services in a model that continues to evolve. Today, CSRA works with NASA to provide multi-functional services, including 40% of NASA financial management transactions; 100% of NASA’s time and attendance, accounts payable, fund balances, and internal controls; 80% of accounts receivable; and 25% of HR management responsibilities. CSRA’s HR management responsibilities includes 80% of the work related to case documentation and employee benefits processing.
Since winning the NASA Shared Services Center (NSSC) contract, CSRA has helped the organization to reduce line of business support costs by 25% and improve the overall customer experience. For example, 80% of all customer service calls are answered within 60 seconds, an improvement of 50% over previous results.
Shared services is in the national spotlight, and for good reason. It has the potential to deliver significant efficiency and productivity gains to federal agencies as they execute their mission. One size does not suit all, however, and thankfully models and options abound. Regardless of the approach chosen, agencies must also commit to and prioritize organizational change management, which has proven itself time and time again to be the cornerstone of a successful shared services initiative.