Changing Gears

As budget gaps continue to expand, technology can generate cost savings and improve service delivery.

by / April 22, 2003
The vice grip on budgets remains tighter than ever as state and local governments head toward the end of the fiscal year in June. As leaders talk about tough choices and the need to control costs, they also see an opportunity to change certain facets of government to make it more efficient and cost-effective.

It's clear some governors and mayors are thinking about how to use technology to make government faster, better and cheaper. CIOs echo that sentiment. A survey last year of 1,500 CIOs by Gartner Group found that while many know overall costs must be reduced, IT executives believe demonstrating the business value of IT is even more important.

Simply cutting back only leads to trade-offs that could hurt in the long run. Instead, organizations should make strategic IT investments that deliver benefits in the form of cost savings and better value. With the economy in the doldrums, it's a buyer's market with vendors offering attractive discounts and flexible buying plans, according to CIO magazine.

That's why now is the time to invest in technology, rather than just arbitrarily slamming on cost controls. More importantly, strategic investments can generate significant cost savings. That's what a number of state and local governments discovered by investing in tried and true technologies, such as Web-based business applications, CRM, electronic workflow and document management systems, as well as outsourcing routine operations, such as maintenance and support.


Sure-Fire Savings
State and local governments have long known that when done correctly, outsourcing certain types of IT operations saves money. For example, Minneapolis recently signed a seven-year contract with Unisys to manage the city's entire IT infrastructure -- from the data center to desktop computers and mobile devices. The deal is expected to save the city approximately $20 million over the life of the contract. Unisys will manage and support 2,700 PCs and more than 100 servers.

The cost savings for Minneapolis are based on projections, but some jurisdictions and agencies have hard and fast numbers to prove their solutions not only work but save taxpayer dollars. In Cook County, Ill., the Assessor's Office estimates the value of 1.6 million parcels of real estate, which generate about $8 billion in annual tax revenue for the county.

Valuations are challenged more than 100,000 times a year, with wealthy challengers often winning because the county's process for assessing properties was, until recently, cumbersome and often faulty. The culprit: tax maps hand-drawn on Mylar. One change on a map meant all other corresponding maps had to be manually updated and compared with lists of statistics. Often, assessors made mistakes with the manual process and had difficulty defending their revaluations in court.

In the mid-1990s, the Assessor's Office began automating the manual system using ArcGIS software from ESRI and a DB2 database from IBM. Today, the entire geo-spatial assessment process is digital, reducing labor needs by two-thirds and saving the county millions of dollars. Additional savings were generated by property tax revenue recovered because the Assessor's Office was better prepared to defend its valuations in court.

The Assessor's Office generated these savings by establishing an electronic workflow, which integrated GIS with the database. The office needs fewer staff to match properties with assessment data to identify recently sold properties that need to be revalued. Further, aerial photography is merged with business data to visually verify information without the time and expense of sending someone to the property to perform those tasks and with a higher degree of accuracy.


Cutting the Jobless Line
For government agencies that experience an upswing in service demands, cost savings may seem like a pipe dream. But when the Division of Employment Security in Kansas' Department of Human Resources experienced a sharp increase in weekly job claims, it not only handled the spike in demand with technology, but also generated significant cost savings.

The agency hired Accenture to design a call center solution using Siebel technology with the proviso that the head count could not increase. Rather than propose an entirely new system that would take years to complete and show benefits, Accenture layered several solutions on top of the department's existing information systems.

First, the company built a portal so claimants and businesses could access information, including unemployment claims, without overloading the call center with requests for routine information. Second, the company updated the interactive voice response system, which also alleviated call center volume. And third, Accenture improved call routing and built an application that provides operators with a single view of claimant information at all times.

By pushing the management of straight-forward claims onto the Internet, where claimants could access their own information, including job data, the department saw a one-week decrease in overall unemployment for claimants who filed over the Internet versus those who did not. Translation: The state now saves about $5 million annually on unemployment claims. Call center queue times have plummeted from 30 minutes to less than 5 minutes.


Trafficking in Workflow
Local courts are another area where workloads continue to increase while budgets grow tighter. In Miami-Dade County, the traffic court system faced the twin problems of expanding paperwork and declining staff resources as the region's population continued to grow, and budgets failed to keep pace.

Initially, the court looked at automating its calendaring system so beleaguered judges could keep track of their growing caseload -- 3,000 cases processed in 21 traffic courtrooms in six locations. By the late 1990s, traffic cases were growing astronomically. So the court invested in an enterprise content management system from FileNet.

Accenture was the prime contractor for the project.

The system, called SPIRIT, captures all incoming traffic case documents at a single point and automatically routes them across a network to appropriate work areas within the traffic court system. Judges and clerks have access to document images stored in a repository. The storage system currently holds 15 million documents and receives 10,000 additional pages every day.

The payoff was tremendous, according to Tom James, CIO of the Miami-Dade County Clerk of Courts. When work began on the system in November 1998, the traffic court had 240 employees and processed 500,000 citations annually. Today, 180 employees process 700,000 citations per year.

"Prior to automation, a single piece of paper was touched 30 times," James said. "Now, the document is touched only six times as it moves through the system."

The Clerk's Office managed a 60 percent improvement in traffic fine collection using electronic workflow and associated technologies, even with a 30 percent increase in traffic cases and 15 percent fewer staff. The Clerk's Office saved $1 million in personnel costs and regained 3,500 feet of valuable storage space.


Clear Message
Current fiscal conditions are forcing most state and local governments to take draconian steps to balance budgets. Unfortunately, some moves will be made in the name of cost control that will end up sacrificing value and services as well.

Key technology implementations, as these agencies and others have shown, can allow government to absorb cuts without damaging what they are expected to deliver. That's the message today's CIOs have to deliver to elected leaders.

Technology can no longer be separated out as part of a cost control effort. It must be viewed as an integral part of government. When considered holistically, technology can deliver both savings and better value.