April 28, 2005 By Blake Harris
While Menchini is modest about the city's overall IT accomplishments and argues that many other large cities have also made significant progress lately, the reality is that New York City presents challenges unlike those facing any other city CIO.
For one thing, there is the city's sheer magnitude. New York City's annual budget of $48 billion exceeds the size of all but five states. Menchini's own department has a budget of $180 million and now includes approximately 1,200 employees. Yet that is not nearly enough to do everything asked of him, and IT budget issues are a constant concern.
"What we do is just so different from what most other municipalities do, or for that matter, what most other governments do in terms of the scope of our services," Menchini said, adding that the municipality encompasses five boroughs, the equivalent of individual counties. So New York City itself provides a wide range of services -- such as human services -- typically provided by counties. "On top of that, you have the size and magnitude of what we are. Even just the intensity of New York City and the depth of needs in certain areas make for a very challenging government environment. And then added to all this was Sept. 11th. Our jobs, I think, increased exponentially in terms of what we were faced with after that."
Bloomberg and his administration came to power only a few months after 9/11, and response to that and other possible terrorist threats has been the crucible in which the new administration was forged. Without doubt for Menchini, who was directly involved in the response from day one, that personal experience continues to shape many of the dimensions of his job at the helm of DoITT.
Menchini, who grew up in Brooklyn, actually left public service after a 14-year stint as head of MIS at the city's Board of Education, followed by three years as head of IT for the Office of Operations where he led city Y2K preparations. He was working as a major-account manager for Cisco Systems when the World Trade Center collapsed. He immediately jumped in to help.
Just hours after the attack, after clearing it with Cisco CEO John Chambers, Menchini was ripping equipment and supplies out of Cisco's New York offices and loading it into police cars and taxicabs. And with Larry Knafo, now one of his deputy commissioners, he built the telecommunication and IT components for the initial command and family assistance centers, and then larger facilities when these proved insufficient after the first 24 hours.
As we drove through Manhattan years later, Menchini described what it was really like there -- the streets filled with a foot of dust, where Knafo's parked car was crushed by falling debris, where he was pulling people out of taxicabs to load in equipment.
"It's really hard to reconstruct the events of that day and the aftermath in our minds," Menchini said. "A huge area in Manhattan was uninhabitable because of all the dust. The power went out. When the Verizon building got hit, the entire downtown area lost phone service. And this is where most of the city administration is -- police, fire, City Hall. Every agency has their main office down here."
Getting the needed technology in place in those first few days involved lining up equipment from around the country, organizing military aircraft to fly it to New York before regular flights were restored, and getting it unloaded and then loaded into trucks that were then escorted into the secured area.
For six weeks following the attack, Menchini wasn't home except to pack a bag.
Shortly after that, Bloomberg asked him to head DoITT. "During the first couple of months we were in office, we were dealing with the loss of the two Trade Towers -- not just the tragic loss of people, but also the loss of the 220 acres of office space in those two buildings," Menchini said. "That is what most cities have as their entire business district. So we had to deal with the economic impact of that on the city. It coincided with the bursting of the dot-com bubble of the stock market, especially in the technology area, so that also had an additional impact on the city's economy. Then we had a budget problem that had been creeping up on everyone. Everything was hitting us at the same time."
Seeking the Magic Bullet
Against that backdrop, during the administration's first week, Bloomberg and Menchini discussed the many things they wanted to do. The mayor thought they needed to find the magic bullet -- was there one thing they could do with technology that would really change government? They settled on a 311 call center with the ambitious goal of making it operational within a year -- a goal Menchini met.
Much lay behind the decision to focus on 311 that reveals both Bloomberg and Menchini's views about what technology can do to transform government. Of course, Bloomberg himself was no stranger to technology -- he made his fortune creating financial information systems for Wall Street traders, and now as mayor, still often gets into the nitty-gritty of mapping out technology strategies. Menchini often points out, "There are chief executives that get it, but Mike Bloomberg doesn't just get it. He gives it."
Bloomberg clearly sets the pace for major technological initiatives in the city, laying out stiff completion targets for projects. On the day I spent with Menchini, he was gathering information, arranging demonstrations for the mayor, and meeting with him to discuss timelines for a new 911 system to meet New York City's complex needs. Best industry estimates are that it will take several years to build, especially if it uses a combination of GPS and vehicle location technology that doesn't yet exist commercially. According to Menchini, however, Bloomberg's initial view was that if 311 took a year to build, why couldn't they do 911 in six months? "We're the victims of our own success, and now 911 just might kill us," Menchini said half-seriously.
In talking about the original decision to tackle 311 first, Menchini raised a host of issues, such as the difficulties CIOs have in showing ROI on technology investments that actually shows on the bottom line.
"You can talk about cost avoidance very easily," Menchini noted. "But real hard savings, where you are able to look at a balance sheet and see the investment you make in technology and all the costs associated with it, and then on the other side of a balance sheet level, you show where you save these 3,200 people and where this cost goes away -- that is really a problem in government."
Additionally, he said, governments generally under-invested in technology for such a long time that almost everything they do tends to require a huge investment in the underlying infrastructure. In the private sector, budget processes have replacement cycles built in. "But I don't know if there is any government entity that has actually dealt with that well. That's something I'm still struggling with -- how to build technology investments into a sustainable budget model. Every year when you are facing a fiscal crisis, that is not the year to bite the bullet."
Menchini believes the real ROI on technology today is often the difference between doing a good job and effectively responding to needs. "Certainly I think if you look at the customer satisfaction level and the quality of service being provided by government, this was deficient," he said. "With technology, you can change that. Though it might cost more money in some areas, ultimately a transformation in our cost structure will occur. Moreover, you can begin to provide the service citizens have come to expect -- a service or product that is actually better than was being provided before the technology-enhanced model was available. That's where the real benefit of technology lies for government."
This already has been proven with the success of 311 -- which is not to suggest that the financial argument for the project was a difficult one to make. As Bloomberg put it to Menchini, New York spends $48 billion per year on services, yet no one knew how to get to them. So to spend $25 million to make access to those services simple and easy for citizens makes absolute sense.
Yet 311 was also about transforming how the city's government works, something not actually accomplished through the Web. Although New York City's very successful portal did provide the first simple-to-access overall directory of services that crossed the traditional silos, Menchini said it was mostly just a veneer placed over existing departments. "It really did not penetrate the operational model of agencies and change the way they did things," he said. "It didn't get institutionalized. In some instances, it happened, but not at a universal level. So we began figuring out what we could do, and the call center came to the fore."
Menchini began looking at this prior to joining the administration. He realized that while Web access had really been an add-on -- an appendage bolted onto the main body -- call-center-type functions had long become intrinsic to agency operations. "They had already institutionalized call-center-type functions into their intake process and their customer-facing activities," he said. "By consolidating the call center, we were able to get a lot more day-to-day operations institutionalized into the central call center model."
As far as Menchini is concerned, the Internet really has served as a call to arms for government entities. People are now accustomed to going online and dealing with most commercial providers. "There has been transformation in the way businesses and citizens deal with everything other than government. So there is a broad expectation that now needs to be met by government for it to survive as a provider of services to citizens.
"People recognized they weren't getting service from government. You see a police officer writing out a ticket by hand, and yet the FedEx guy walks by, scans a package electronically and it arrives exactly when you need it," he continued. "People think government is still stuck in the older model without any real innovation. I think that's one of the biggest challenges -- changing the perception of government, the lack of innovation, the lack of progress and not keeping up with the transformation that has occurred in the private sector from a customer service perspective."
Menchini believes the success of 311 is measured by far more than the raw statistics -- the 11 million calls it received last year or the 40,000 calls it now averages per day. "In part, it gets back to that perception that government is operating behind everyone else. In actuality, we are not lagging so far behind, and we are not so stoic and out of step with the way most organizations operate. But people simply didn't know it. We were able to fill that gap, and the perceptions changed remarkably. What amazes me is how often I hear that not only did someone get through to the city about a problem, but that problem was then actually addressed. The garbage got picked up. The inspector came. People attribute it to 311, but it goes far beyond what we can take credit for. In a lot of areas, this city really does quite a good job. But people didn't have an easy way of communicating with the city to report problems. Now they do."
A Two-Way Connection
The 311 system also has begun to transform and even reform some government operations. Menchini offers the Building Department as an example. "You can always tell there is a problem when there is a whole industry that's active just to deal with an agency. That's always a red flag. And there is a whole industry out there that helps people deal with the Department of Buildings," said Menchini.
Expediters were making appointments with plan examiners, the people that approve building plans, and were reserving whole sections of their favorite examiner's schedule. That way, they could simply walk in and get what they wanted. Meanwhile other people who weren't paying expediters had to wait months even to make an appointment with an examiner.
Now everyone must call 311, which runs on Siebel Systems' customer service software, to schedule a meeting with a plan examiner. The call center operator initiates a Google-like search through the 7,000 different city services and brings up a number of items to do with plan examiners. One item is to schedule an appointment with a plan examiner. The operator clicks on that, the scheduling function comes up in software, and he or she will right then and there schedule the next available plan examiner. As a result, expediters can no longer block off huge sections of time. "We are now up to 85 percent utilization of our plan examiners, and we are down to a one-day delay for an inspection," Menchini said.
The 311 system also offers feedback to city officials in several ways. Menchini now has a group of people who do nothing but analyze data and draft reports based on 311 calls, which are coded by location, making it easy to detect patterns. Call volumes and the disposition of services can also be tracked. This gives officials insight into how different city services get delivered. "The mayor and everybody else has become very accustomed to this," Menchini said.
Originally Menchini only wanted to handle the technology component of the call center and then hand it off to someone else. However, it seems to work well as part of DoITT, even though it also means Menchini's organization now sometimes must take ownership of problems. "When I get a supercomplaint -- someone calling up and saying, 'I've called 10 times, but the problem's still not addressed' -- we take ownership of it. We will call the agency responsible. We will bring it to the attention of the commissioner's office to get it expedited and addressed rapidly now that it has hit this level."
Scope of the Job
While 311 has been a centerpiece of Bloomberg's pledge to make government less confusing and more responsive, it still is only one small piece of Menchini's responsibilities. These include not only IT, but also telecommunications and managing five cable television channels, as well as a regular broadcast channel and a radio station. "I am actually a media mogul," Menchini joked. "I now have to go through an FCC review. They wanted to know if I own major stakes in any other broadcast companies because I was about to get a license for a noncommercial broadcast television station."
These networks form part of the emergency communications system. Fiber runs into the Police Plaza, City Hall and the Office of Emergency Management, for example, and mayoral press conferences or live emergency broadcasts can transmit from any of these locations.
Menchini, however, also set out to revamp and professionalize these TV channels to turn them into a real resource for the city. Previously much of the programming consisted of boring city council hearings that nobody watched. Or it was community programming with no set schedule, so people never knew what would be on. "We've put some resources there and refined the mission to include promoting in-town tourism, for example, as well as letting people know about the good things the city is doing," Menchini explained. "So it really became more of a city channel."
The changes Menchini brought to DoITT itself are extensive. Some are a direct result of the experiences of 9/11. Below the surface of the city's daily life, there are now levels of security that were unimaginable in earlier times. The building that houses the city's data center, for instance, lies behind an extended security perimeter that is guarded 24 hours a day.
Beyond the physical security, there are also mechanisms designed to meet many different contingencies. "Administratively the aftermath of 9/11 was a nightmare," Menchini explained. "It took us two years to climb out of the mess created in that. The technological response was remarkable, and I was glad to be part of that. But we ended up with all this equipment coming in and everybody saying, 'FEMA will pay for it.' But no one really knew what FEMA was going to pay for."
Menchini put a contract in place so that now, even in a small emergency -- a fire in a data center, a water main break that destroys equipment -- or something on the scale of 9/11, one company, IBM as it turned out, would act as the city's prime contractor. They will supply and keep track of everything, managing inventory, ensuring FEMA rules are followed in the case of a FEMA-reimbursable program, and ensuring suppliers are fully lined up to meet any IT, network or telecommunication equipment need.
Bloomberg and Menchini pushed through many new measures simply to allow DoITT and other departments to operate more efficiently. "The first thing we did was tackle the hiring oversight board that used to take four months to vet people to determine whether they could come on board," said Menchini. "For technology, it was impossible to keep people like that. So that was eliminated -- the mayor did that to sort out some of the idiotic level of oversight and management of commissioners. Commissioners are the people that do business, and they need to be able to hire the needed people without someone saying whether or not they can."
Menchini also streamlined the RFP process for smaller technology projects. "I needed a mechanism so that when the mayor comes to me and says, 'I want to do this,' there was a way to do that within his first term," said Menchini. So now DoITT has a number of preapproved vendors, and for projects less than $5 million, he doesn't have to go through a whole formal RFP process. He simply goes to these vendors, discusses the project to get their feedback about the best solution to use, and then collects bids from a number of them in a kind of mini-RFP.
Menchini is now bundling together the estimated $180 million in telecommunications services the city buys each year into one contract to save millions of dollars and also ensure all departments and agencies get the best service possible. "I brought a person in and restructured my organization so there is a person who just focuses on that -- not only this RFP, but also to operate as an ombudsman. That way, we can meet weekly with Verizon on installation or repair problems, and it is amazing the response we've gotten as a result. Problems get resolved much more rapidly."
On the Move
To achieve as much as possible in any given day, Menchini is constantly on the move, shuttling between different locations around the city. Although he has a bullpen cubicle in the main DoITT office in the same management style adopted by Bloomberg at City Hall, in practice Menchini's office is wherever he happens to be.
His car is wired for every contingency with three radios -- police, fire and Office of Emergency Management -- as well as satellite phone, a Government Emergency Telecommunications Service phone, a BlackBerry, and a couple of other cell phones. "I typically go to people's offices rather than have them come to mine," he said. His key deputies also regularly jump into his car for a quick meeting while Menchini heads to his next destination.
On that day, Menchini conducted our interview in bits and pieces as he moved from meeting to meeting. After 12 hours, I was left with an image -- Menchini's car fighting through New York traffic to get to City Hall for a meeting with Bloomberg. Meanwhile he managed two different calls on cell phones and urgent e-mail messages on his BlackBerry. In the background, chatter from the police radio served as a constant reminder that he is always ready to swing into emergency mode at a moment's notice. And after spending the day with him, that pace somehow just seems normal.
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