The push to establish the use of shared services within the federal government to streamline delivery of many back-office functions, especially financial management systems, has gained adherents ever since the Office of Management and Budget (OMB) and the Treasury Department designated four providers in May.

The providers – USDA’s National Finance Center, Interior’s Interior Business Center, the Enterprise Services Center at the Transportation Department, and Treasury’s own Administrative Resource Center – have begun to sign up agencies to make the transition to modernized systems.

At the ACT-IAC Shared Services Forum last month, David Lebryk, Fiscal Assistant Secretary at Treasury, said the four centers will improve service and cut costs, but agency early adopters will be sharing their learning curve. Lebryk compared it to changing the oil in your own car – the first few times it takes longer than a professional mechanic would take, but with practice you can do it just about as quickly.

“One reason why the conversation we’re having [about shared services] is because there’s tremendous pressure to focus on the mission, and the mission is not necessarily about back-office accounting,” he said.

But moving to shared services will not be easy, said Robert Shea, former associate director at OMB, during a panel discussion. He recounted many of the e-gov initiatives undertaken during the Bush Administration, and said there were very few success stories.

“The bottom line is, it’s damn hard to get agencies with their own power and control” to surrender their authority, Shea said. “It takes a lot of cajoling, convincing, persuading.”

He suggested that it takes a very clear, preferably narrow, focus on one specific shared service. He also said that cost savings do not make a good goal; better service to internal and external customers is a much better motivator. It’s also important to consider a Plan B, in case shared service performance levels don’t meet expectations, he added.

David Mader, OMB’s Controller, observed that consolidation and shared services are not the same thing.

“There’s a very different relationship between buyers and sellers,” Mader said. “It really causes [client agencies] to think about their customers, and the reinvestment aspect” of cost savings.

During another panel discussion, Kathleen Turco, CFO for the Veterans Health Administration, said that historically government agencies have not done well at preplanning, planning, or program management.

“I think that unfortunately is where we shortchange this effort,” Turco said. “It’s rarely the software, it’s the people.” She added that OMB also needs to recognize the importance of preplanning and planning as precursors for long-term success.

USDA CIO Cheryl Cook discussed how her department’s own experience over a decade prepared the National Finance Center to meet the needs of other agencies. But even there the department still has some goals it hasn’t yet accomplished.

“Congress in 1994 passed the Agriculture Reorganization Act [that] required field offices to co-locate,” Cook said. “It took 10 years … we now have had 10 years of biting and scratching and clawing” to get to the objective.
Cook suggested that “mandatory” can mean different things to different people on different schedules.

“Mandatory with flexibility is the way to go,” she said. “Before I leave USDA, before I go, if it kills me I’m going to consolidate our networks. I don’t know if we can get to one, but we can get to less than 15.”