Building the Enterprise - Booz Allen Hamilton

pected to take that step. 8By 2009, almost all federalpayroll services were consolidatedamong four government-wideshared services providers, and OPMnamed five interagency providersfor personnel services. Today OMBapprovedinteragency shared servicesproviders include the InteriorDepartment’s Business Center, theAgriculture Department’s NationalFinance Center and seven others.These providers offer shared servicesfor budget formulation andexecution, geospatial data, informationsystems security and financialand grants management, in additionto personnel and payroll services.For the most part, LoB sharedservices providers have focused onleveraging common business systemssuch as human resources andfinancial management to provideinteragency customers with back-officeand transaction-processing support.This includes such core administrativeservices as cutting payrollchecks and processing promotionactions, posting debits and creditsto an agency’s operating ledger andtracking procurement contracts.The original promise of sharedservices providers has not been met.The vision was that they would assumeeven more of the government’scommon administrative workload,including labor-intensive functionssuch as the interaction between amanager and a personnel specialistbefore a promotion decision is madeand processed. Now it is time to realizethat promise.Additional enterprise efficienciesare possible. For example, theAir Force has consolidated many ofits personnel support services foractive-duty and reserve militarymembers as well as civilian employees,using a sophisticated combinationof online self-service applica-8 CIO Council, Federal Shared Services ImplementationGuide (Washington, DC, April 16,2013).tions, automated voice-responsesystems and live personnel specialiststo provide near full-time coveragefor the department’s worldwideforce of nearly 500,000.The Internal Revenue Service’sAgency Wide Shared Services organizationprovides similar consolidatedpersonnel services, such as staffing,labor and employee relations, forits nationally deployed workforce ofmore than 100,000. If such servicescan be provided on this scale withincomplex, diverse and geographicallydispersed agencies, they can be providedas an enterprise portfolio to allagencies.The DOD’s more than three millionmilitary and civilian personnelare paid through a single integratedpayroll system. Its 800,000 civiliansare covered by a single humanresources information system. 9 Yetcivilian employees still are servedby more than 100 separate personneloffices, each providing similarservices under almost the same personnelrules using a common humanresources information system.This situation is ripe for consolidation.And the Pentagon could offerthe service on an enterprise basis toother agencies.The other HR shared servicesproviders, such as the Treasury Departmentand the National FinanceCenter, can and should follow thissame path. They already providetransaction-level support to multipleagencies and could build uponthat success to offer additional personnelservices to their interagencycustomers at significant savings,such as drafting job applications.Personnel services are not theonly area ripe for an enterprise ap-9 Department of Defense, Fiscal 2013 BudgetEstimates, Defense Human Resources Activity(Washington, D.C., Feb. 2012), http://comptroller.defense.gov/defbudget/fy2013/budget_justification/pdfs/01_Operation_and_Maintenance/O_M_VOL_1_PARTS/O_M_VOL_1_BASE_PARTS/DHRA_OP-5.pdf. Lastaccessed Jul. 26, 2013.proach. The Obama administrationhas issued a shared-first policy forfinancial services information technologysystems. On March 25, 2013,former OMB Comptroller DannyWerfel directed all agencies to useone of the approved shared servicesfinancial management providers tomodernize their core accountingsystems.According to Werfel, “the cost,quality and performance of federalfinancial systems can be improved byfocusing government resources onfewer, more standardized solutionsthat are implemented and operatedby more experienced staff.” Sharedservices provided using standardizedfinancial systems will reducethe risks of large, lengthy financialmanagement system implementationsand make federal financesmore accurate and more transparent,Werfel said. OMB also plans toensure that financial shared servicescenters use common standards andrequirements so agencies retainthe flexibility to migrate amongproviders.This is exactly the sort of enterpriseapproach to shared servicesthat is needed—leveraging commonfunctional requirements, businesssystems and IT infrastructure toprovide mission support in multipleagencies. Indeed, these effortsshould be expanded under the auspicesof an enterprise goal leaderfor each of the LoB portfolios, withthose goal leaders charged to takethem to the next level of enterpriseefficiency and effectiveness. •BUILDING THE ENTERPRISE 19