Getting Into Preschool

My oldest grandson, Colin, got into preschool because he played well with others and shared his toys.

SharingThe federal government is in the early stages of testing its ability to share. Several agencies are working hard to use shared services while others seem less than enthusiastic. Whether the government will measure up to Colin’s preschool standards is uncertain.

Certainly each federal agency has specific—and unique—program responsibilities.  Handling those core and unique programs well is essential for each agency. It is also clear that there are numerous administrative support functions that are not unique. These functions are with minor exceptions common throughout government. Accounting transactions are required to follow guidance by OMB and Treasury. Hiring and other HR functions are prescribed by statutes and OPM regulations. There is little leeway for agencies to diverge from government wide procurement rules. Travel, time and attendance and payroll requirements and processes are based on standard government requirements.

Given the commonality of these activities there is a great opportunity for government to reduce costs and improve the quality of its operations by adopting shared services for these administrative support functions.

Yet, some agencies have raised a number of concerns about moving to a federal shared service provider.

Some have questioned whether the quality and reliability of the service will meet their requirements. It seems to me that improved quality and reliability is best achieved by relying on organizations which have administrative support as a core mission. But agencies don’t have to rely on that axiom; they need only look at the record:

  • Payroll processing which is certainly a high-priority is conducted reliably and accurately by four federal providers every payday.
  • Treasury’s Bureau of Fiscal Service makes over one billion payments each year on behalf of SSA, VA, OPM and most every other government agency. I believe these payments are of the highest quality and reliability.
  • Nearly all government receipts are collected by relying on the services provided by the Treasury.
  • In the HR arena, agencies using “HR Connect”, for example, have been provided good service with ever increasing benefits from economies of scale.
  • There are high quality electronic invoice systems that provide quality service to the government and contractors at greatly reduced costs.

In addition to the reduced costs in processing transactions, there are huge cost savings from reducing the number of system development upgrades. While there have been some exceptions, for the past 30 years a large percentage of government system development initiatives have been implemented years later than planned and at significant cost overruns.

As the federal government moves to implement the DATA Act which will transform the use and publication of data, this change will be much easier for those agencies using a federal shared service provider.

One final point is the issue of “control” that some agencies have raised with regard to federal shared service providers.   Besides the point mentioned above that this is a core mission for the federal shared service providers, there are service level agreements and governance processes in place that should assuage those concerns.

I believe that OMB and Treasury have set a clear policy direction to achieve an important transformation in federal shared services and they need to remain totally committed to that goal. Agencies such as HUD should be applauded for committing to use a federal shared service provider. Agencies that are not yet using federal shared services need to make a commitment and achieve the cultural changes within their organization to make this a positive transformation rather than find reasons to “slow walk” or resist this important change.

There is still plenty of room at Colin’s preschool and all who come in the door are richly rewarded.

Dick Gregg is a Managing Director at HJS with a focus on Federal Financial Management, DATA Act and Shared Services.
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