A CEO of IT: Applying Business Transformation Frameworks in Government
By Marian Cook, Senior Strategist, State Of Illinois
Those of us in the private sector often wonder how a business management approach would work in the public sector. As it turns out, done right, they can work well. Hardik Bhatt, the new State of Illinois CIO, is doing exactly that using a CEO of IT approach to address long-term, belligerent problems in government.
"There has not been an enterprise approach to services, policies, standards, security, purchasing power, or other basic business practices"
Illinois is not for cowards. Serious challenges beckon. Cost structures and national surveys put the State at the back of the pack. A cantankerous legislature / executive branch relationship stopped budget passage. A diverse and distributed technology base is over 40 years old and in 86 different technology silos. The workforce is unionized and a retirement wave is picking up speed. There has not been a consistent enterprise approach to services, policies, standards, security, purchasing power, or other basic business practices. In some cases, the status quo and bureaucracy is self-optimized, sentient and defensive. Change is hard and there is considerable push-back.
Governor Rauner, as a businessman and former Venture Capitalist, uses business approaches to transform the state. He turned to Hardik just months ago to transform the state’s technology organization. With practical experience driving change, Hardik is using a business transformation framework – speed, iteration and ROI – that works in any organization, private or public, technology or not.
The first element in this framework is an emphasis on speed. Here Hardik one-ups the business world. The prevailing business time measurement is the quarter. For the technology team, the focus is on 75 day sprints and report-outs. This is a drastic change for an organization that, where measurements and accountabilities existed, the timeframe was in years.
The second principle, ‘roughly right,’ facilitates speed. Slow and perfect is out. By adopting the entrepreneurial mindset of speed, feedback and iteration, the management approach becomes agile - focusing on experimentation, small wins and progress over process.
And finally, a business case and ROI rigor for investment decisions is standard in the business world. This has not been consistently the case in the IT organization. It will be. All technology investments will demonstrate and document benefits to citizens, revenue growth, cost reductions or compliance to regulatory or legislative mandate. There will be accountability for these results over time.
With these operating principles in place, the team’s focus is on three steps, doing them, of course, with speed and in parallel:
1. Improving the business of IT
2. Improving the business of the state using IT
3. Finding ways to leapfrog and take a leadership claim
IT is a business and, at the State of Illinois, one that needs to catch up to the outside world. The foremost initiative is the implementation of the state’s first ERP system. With over 400 different applications and systems managing finance, procurement, grants management and HR, among other basic business needs, and 86 organization and technology silos, the State of Illinois is the only big ten state that does not have a unified ERP system. On an aggressive timeline, the first agencies are going live next summer.
All this activity demands a stronger governance structure to manage priorities, investments and accountability. This is happening via strengthening the implementation of an Enterprise Program Management Office (EPMO), and enterprise performance management.
Underpinning all of this is a need for collaboration and culture change. Almost all of those 86 technology silos have CIOs. Many of them have innovative solutions to common problems that could be leveraged in other agencies. Moving them to work collaboratively to transform Illinois versus focusing on their own agency needs has been a strategic, methodical approach.
First, the Agency CIOs were brought together for general education, collaboration and interactive work sessions as the CIO Council. Designed to also ‘externalize the enterprise,’ outside and business points of view are brought in via a speakers series. The impressive speakers’ list includes the CEO of Orbitz, the CEO from the award-winning business incubator 1871, and innovative start-ups.
Agency CIO working groups were then formed to create enterprise strategies for data analytics, mobile, Internet of Things, innovation, cloud, cyber-security, agile development and others. Cross agency collaboration and synergies are picking up as mindsets shift to enterprise versus agency thinking. Resources, tools, software and best practices are now being shared.
The next step in this evolution is moving many of the working groups to Centers of Excellence, and then, in several instances, to formal, centralized, staffed organizations.
In parallel to improving the business of IT, progress is being made on the second step: improving the business of the state. Much of this overlaps, are the ERP and EPMO initiatives, and the enterprise strategies created by the Agency CIO working groups.
The enterprise mobile strategy is an example of an initiative that improves the business of the state. Citizens expect mobility, so to be truly customer focused, mobile needs to become the primary platform. It is also an example of cross agency collaboration as IT teams that have never worked together before create new mobile apps.
Data analytics is another example of improving the business of the state. Illinois sits on petabytes of siloed data, previously protected vigorously by agencies and their lawyers. The barriers are falling with Hardik’s impatient push as he builds recognition of data as a strategic asset for the state and its citizens. An enterprise data analytics organization is currently under construction.
With his “Smart State” vision, the Internet of Things (IoT) is an area Hardik sees as an opportunity for step three: staking a leadership claim. Through his practical experience in private and public sectors, he is personally aware of the value IoT can create. He has worked from Jakarta to Hamburg to Rio and elsewhere as Cisco’s Global Market Development leader for Smart Cities before accepting the State CIO role. Prior to that, he implemented key Smart Cities constructs as Chicago’s CIO that is giving a high ROI to the city to this day. This practical experience can drive real technology leadership for the state.
The State already has an exemplar in the Illinois Department of Transportation (IDOT). IDOT is currently working with five other Midwest states in a ‘smart corridor’ use of sensors, video and analytics to improve highway safety and efficiency. There are plans in the works for considerable IoT talent development and implementations to capture the value this new technology wave can drive.
To further build expertise and a business perspective, the Governor and Hardik have convened two advisory boards of luminaries from industry, academia, not for profits and philanthropic organizations to help partner with Illinois to drive government transformation and IoT value creation.
As a former Venture Capitalist, the Governor understands how business approaches and technology can be the engine to transform the state, and Hardik agrees. In talks private and public, Hardik refers to a quote from Steve Jobs: "We are here to put a dent in the universe. Otherwise, why even be here?" A strong sense of civic responsibility and meaningful work solving meaty puzzles with generational impact pulled him back into public service. His global experience and CEO approach will help make that dent as large and as positive as possible.