North Carolina Passes IT Reform Legislation

An interview with North Carolina CIO George Bakolia

by / August 5, 2004

George Bakolia, CIO

The North Carolina Assembly just passed SB991 -- "An act to improve state government information technology planning, adopt standards, make project development more efficient, reduce cost overruns, provide assistance to state agencies and increase accountability" -- which grants broad new authority to the CIO, and eliminates the state's Information Resource Management Commission. This is an interview with North Carolina CIO George Bakolia, conducted on behalf of Government Technology Magazine and the Center for Digital Government.

North Carolina was one of the first states to set up an IT oversight board, and now that many other states are moving in that direction, the North Carolina Assembly takes a 180 degree turn, moving away from a board structure. What happened?

Bakolia -- When the oversight committee was created some time ago, it was functioning properly, it was the right size, the members were excited and participating, they were not politicking in there. But over time, the Commission just lost its luster from my perspective. When I became the state CIO in 2002 ... I noticed conflicts between the direction the state CIO wanted to promote IT in government, and what this body wanted to do. You had no clear line of authority, with the state CIO reporting to the governor, responsible by statute for certain things, and then you had the existing law, where they had given a lot of authority to the other body. You had two different entities trying to make decisions, and that just did not work. Before, I had responsibility but no authority. Now I have the responsibility, but I also have the authority.

There were project failures, lack of enterprise shared services, and those were the two key areas that pushed legislators to move. We do some good things, but we could do better.

How does SB199 affect the state CIO? What is added to or subtracted from your position, and how does it affect the leadership and management roles you play?

Bakolia -- The CIO, prior to SB991, did not have the ability to do aggregate volume purchasing on, for example, desktops. So even though we had a state contract, I did not have the flexibility to sign on behalf of the state, and do one big purchase two times a year, for example. Same thing for enterprise software licenses. Microsoft approached me and said: "We have Microsoft licenses with 26 different state agencies, if you could pull these together, we could give you a better discount." It's ultimately the taxpayer's money, but I couldn't do that. I would go back to the marketing representatives and say "I don't have the authority to sign off on this, because I don't have control of the budget." The agency has control of the budget.

So 991 gives the CIO that flexibility on IT spending and purchasing. The other key points in that are project certification and approval. They have really tried to address that problem big time, because of project overruns that cost millions of dollars. They have basically asked the CIO to review and certify the project if it exceeds $500,000 total, and also assist the agency in assigning project management assistance. Not that he has complete oversight, but has eyes and ears on a daily basis and knows where that project is going. They don't want to hear about it after the train has derailed. That's where the IRMC got caught off guard, because they met monthly, and there was no real daily project assessment. You had projects that doubled in scope and size and budget. So project certification, approval and oversight was a key area.



For the first time in North Carolina, they have given us an information technology fund. The Legislature appropriates the funds targeted to spend in specific programs, and -- unlike the rest of our IT budget -- it does not revert, money can stay in the fund. And we can go back to the Legislature and get approval to put the money back toward improvements or forthcoming IT initiatives.

We never had the luxury of an IT fund by statute, and the ability to use it for statewide initiatives. Now we have one for our business infrastructure study, which is looking at replacing our HR and payroll and budget and accounting systems for the entire state. And our security efforts, our project management efforts -- everything. We are looking at incorporating additional ones in subsequent years, like the Web portal services we have in the state, and e-mail and so on.

How does passage of SB991 affect the relationship between state agencies and the CIO or the Office of IT Systems?

Bakolia -- If you were to ask executive branch agencies, they would tell you it's a good thing. If you asked the Council of State Agencies, you would get a mixed reaction. The agency heads are elected officials. Some of them have viewed SB991 as taking power away from them and shifting it over under the Governor's Office. Even though I'm only responsible for the IT oversight, I'm doing my best to make them feel a little more comfortable, going halfway at least, and seeing ways and opportunities where we all benefit, including the citizens. I'm hoping this will work out.

What does this bill mean to vendors selling to North Carolina state government? The bill mentions a technology advisory board focused on procurement, but it doesn't appear to have much authority. How will this change things?

Bakolia -- What the vendors need to be doing is assisting the state CIO and other CIOs in other agencies, to find out how they can help us to provide more economical IT services to the state. What I have told certain vendors -- and I will have the opportunity to meet with a lot of them in a forum in early September -- is that our state does not have enough skill sets and IT resources to achieve all the goals. So we have to look outside.

I want to be smart as to how we engage the vendor community. I want for them to get involved, but I don't want them to take ownership of my programs. I like to keep that in house. I like for them to come back and show me innovative solutions. I like for them to provide me with skill sets that I might lack. I like them to come and maybe complement the support roles that we have here in the form of application outsourcing. There's a lot that they can do to help us, and there's a lot of work to be done. Most likely they'll do as much or more business now, because I'm able to promote more things. I have the technical background. It's probably better for the vendor to interact with me rather than the Commission.

The vendors were concerned because they saw language there that talked about eliminating contractual staff. In all fairness to the state agencies, they don't have the positions appropriated and on their staff to do the work they need to do. So they would do a supplemental staffing contract on time and materials.

What I am suggesting is that we know we don't have staff, and rather than me paying you on an hourly basis to support a program for two or three years, I'd like to create a statement



of work and define deliverables that I would expect from you as a vendor. And I'm going to ask you guys to compete for the business, and then I want a price, a cost. And you support this for three years. But give me a turnkey solution, and it's yours to operate and yours to support.

Why should I be paying on an hourly basis ... when I could bundle in my requirements and turn it over and say : "OK, what's it going to cost?" That's the approach that I will be taking on supplemental staffing. We realize that there might be a need, emergencies, etc., and we might require a staff member from the vendor community to come in for a couple months to help us with something, but those are special circumstances.

You mentioned a meeting in early September, is that scheduled, and can they just contact your office to find out more?

Bakolia -- Yes, its part of an association that the vendor community has here in North Carolina.

In 2003 you put out a document titled: "Statewide Initiatives and Strategies." How does SB991 align with that plan? Are they compatible?

Bakolia -- It is compatible, and allows me to move expeditiously on some of the things I addressed in it. SB991 also builds on some other bills that have been passed the prior fiscal year, like legacy assessment for all our state government business programs that we had captured in this strategic plan -- asset management and portfolio management. So SB991 builds on those.

I have to give credit to some folks for all this. This was a lot of hard work. A lot of folks from the Governor's Office, the Legislature, and some key vendors. The vendor community participated in approaching legislative folks, and saying "Things need to change, and by the way, give the CIO more authority to do something. Allow him to do enterprise licensing, allow him to do some of the things you have captured in 991." So it wasn't just the Governor's Office promoting this. Key legislators worked with us on this. Senator Eric Reeves, who is very IT proficient, participated in this. And Representatives Paul Miller and Joe Tolson.

The reason why I, as a state CIO, was able to be successful in convincing [people] that we need to improve how we do IT, I was able to capture the ears and the minds of budget appropriations chairs at the Legislature, so it wasn't just a few legislators who understand IT, but the turning point was able to convince budget appropriation chairs. These folks saw IT as a service and as something that was worth their time.

Will there be structural changes to the Office of IT Systems? Will you need to add offices?

Bakolia -- The significant change would come in the project management arena, where I've already begun hiring folks and have organized my structure to have an enterprise project management office. Other than that, just minor changes.

Other changes might come up after the agencies put forward the studies that they need to do, within 12 months. At that point -- looking at 2006, when the Budget Office and the state CIO's Office need to present reports to the Legislature -- if those reports show needs for change from an organizational perspective, I suspect that the Legislature might look at that area.
Wayne Hanson

Wayne E. Hanson served as a writer and editor with e.Republic from 1989 to 2013, having worked for several business units including Government Technology magazine, the Center for Digital Government, Governing, and Digital Communities. Hanson was a juror from 1999 to 2004 with the Stockholm Challenge and Global Junior Challenge competitions in information technology and education.