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Colorado Gov. Bill Ritter and CIO Mike Locatis Launch IT Consolidation

Gov. Bill Ritter and CIO Mike Locatis banded together to overhaul Colorado's IT

by / August 20, 2008

When Bill Ritter was elected Colorado's governor in 2006, he arrived at the Capitol in Denver showcasing an ambitious agenda packed with bold ideas that ranged from funding for universal health care and reforming K-12 education to kick starting a "new energy economy" based on sound environmental principles.

But Ritter's carefully laid plans for reform and big ideas faced a significant challenge. The state's IT systems were dysfunctional. In addition to the usual list of decentralized and redundant data centers, phone systems and e-mail programs, the state had a rogues' gallery of failed and failing computer projects. Although the problems were a legacy from the previous administration, Ritter knew the 21st- century state government he envisioned couldn't operate on islands of information running on computers that waste money rather than generate value.

"If you think of all the siloing that goes on - the separate IT functions - it only exacerbates the siloing of departmental functions," he said. "Running government today is in many respects a consumer-oriented business. You need to think about how you do the best work for consumers at lower cost."

Sounding like a Fortune 500 CEO despite his background as a district attorney, Ritter realized the state government lacked access to centralized information for making sound decisions and needed simple enterprise services for taxpayers to use and make government function better. Attention to Colorado's IT problems is now a top priority.


Enter Locatis

Ritter braced for the challenge by doing three things: creating an IT Transition Committee made up of public- and private-sector technology experts; hiring Mike Locatis to be his CIO; and making the CIO a Cabinet-level position.

Public-sector IT leaders rarely follow identical career paths. They can be career public servants, such as Dan Ross in Missouri or David Wennergren in the Department of Defense. Some come directly from the private sector, try to set things right and move on. But increasingly, government CEOs, especially tech-savvy governors and mayors, are choosing CIOs who have a blend of private- and public-sector experience. People like Teri Takai, Steve Fletcher, Vivek Kundra and Paul Cosgrave immediately come to mind.

That's where Locatis comes in. Before his Cabinet appointment in Colorado, he was CIO of Denver, where he showed his centralization skills (and caught Ritter's attention) by consolidating 20 separate municipal and county departments into a single, citywide IT agency. It's also where Locatis learned how fragmented the state's IT systems were.

"It was while I was working in local government that the issues surrounding state IT were immediately apparent because they impacted how services were delivered at the local level," he said.

Before becoming a public-sector CIO, Locatis was the senior director of enterprise technology strategy for Time Warner Cable Inc., part of Time Warner Inc., a Fortune 50 company and the country's largest entertainment firm. Locatis honed his skills at aligning customer-service delivery systems, standardizing desktop capabilities and managing tech and support teams for huge enterprise resource planning applications.

Despite Locatis' knowledge of the state's IT systems' problems, he wasn't expecting the mammoth job he faced. "It was significantly siloed and fragmented IT delivery, which was a root cause of a lot of the issues - including inefficiencies, a lack of leveraging an enterprise approach and just about every [IT] department in the state doing its own thing," he said.

Ritter's IT Transition Committee delivered an even sterner message regarding the state's IT problems. "It was a message about real problems and issues," recalled Locatis. Some challenges were both agency- and project-specific, such as the $223 million Colorado Benefits Management System, which still wasn't functioning properly after four years of work. But the biggest shortcoming was how the state invested its $256 million annual IT budget .

Like the rest of the public sector, Colorado's IT assets and infrastructure reflected years of decentralized and largely uncoordinated planning and management. The state's IT assets included: 38 data centers, 20 phone systems and 20 e-mail systems.

In addition, the state lacked enterprise licenses, forcing IT to pay more for desktop and network services and software. In fact, the state had little to show in the way of enterprise service delivery.

Besides wasting taxpayer money on fragmented and duplicative IT services, Colorado's existing IT management practices negatively impacted the IT staff's efficiency and productivity. Colorado also lacked an enticing career path for IT professionals who wanted to continue working for the state.


Prelude to Change

Identifying the numerous problems with Colorado's IT systems was the easy part for Ritter, Locatis and the IT Transition Committee. It would prove formidable to map out how to change the dysfunctional system - from top to bottom - and implement that transformation so all key stakeholders were on board.

Fortunately the executive order that created the Cabinet-level CIO position also contained a number of vital first-step changes. It authorized the Office of Information Technology (OIT) to approve IT projects and spending requests of more than $10,000. State agencies now provide OIT with an inventory of their IT assets and give the office more leeway when hiring senior IT professionals. The order also granted OIT more authority over project management.

Overall, the executive order gave Locatis the management tools to start changing the status quo. "It gave us a little more authority to go in and start working with the departments," he said. With the order backed, Locatis and OIT were able to quickly launch the start of an enterprise approach to IT management before the next big change occurred.

Following the executive order, issued in late May 2007, the governor introduced legislation that would make the consolidation changes he planned to use to transform the state's IT role permanent.

Preparation was extensive. Locatis and his senior staff interviewed more than 900 state IT professionals, the governor's senior staff, departmental directors, CIOs, third-party consultants and private-sector stakeholders. In addition, Locatis and OIT senior staffers sat down with CIOs and departmental leaders from six states that had undertaken consolidation efforts.

"A lot of times, you don't have the luxury of having a plan before you 'operationalize' a big piece of legislation," remarked Locatis on the breadth of their preparation. "We were definitely not winging it."

The plan, named the Colorado Consolidation Plan, reflected months of research and interviews. Ritter's original goal was to introduce the consolidation legislation during his first legislative session. But as one person familiar with the process explained, support for the bill was far from unanimous, especially among the agencies with the largest IT programs.

Locatis slowed the process down and continued to work on persuading the reluctant stakeholders to rethink their positions.

From Frustration to Legislation

In February 2008, SB 155 was introduced, backed with strong bipartisan support. Ritter pointed out that the bill's support arose because so many legislators knew the system had to change for the better. "We've had some people serving in the Senate and the House who were frustrated by the siloed effect and looked forward to this kind of a change," he said.

Having learned from other state CIOs that resistance from state workers can stall even the best plans, Locatis conducted a massive outreach initiative to explain what the legislation would mean in terms of their jobs, who they would report to and its significance to their careers as IT professionals working for Colorado.

John Conley, Colorado's deputy CIO, explained that getting the right message out quickly was vital. "The message had to be not just what we were going to do, but why we were doing it," he said.

"That's why we delayed introducing the legislation in 2007," added Locatis. "We realized we didn't have enough time to fully and adequately explain why we were moving forward with consolidation."

The bill, passed by both state Legislature houses in spring 2008, was signed into law by Ritter on May 22 .

The law didn't take effect until July 1, but according to Locatis, the benefits were already apparent. "Our project-governance model is getting executive sponsors, the business side of IT is more involved in requirements and the software/system development life cycle, and we're already seeing improvements in project delivery as a result of that," he said.

Another early benefit: the legislation is acting like a stamp of approval on the importance of IT skills in state government. "We see the legislation as a way to leverage our ability to attract and retain IT workers. The state's 1,200 IT workers now have a career path, a toehold in the strategic direction of IT in the state, where before they might have been tucked away. Now they are part of a larger transformation," said Locatis.

Mark Weatherford, former chief information security officer of Colorado, said from an IT security standpoint, the legislation will have a huge impact. "You can now develop an enterprise [IT security] policy that all agencies have to adhere to," he said.

The legislation also allows the state to standardize IT security in multiple areas, such as Web applications, and produce a consistent service level, Weatherford pointed out. "Having a better enterprise view, in terms of IT security, saves money," he added. "I've done a number of consolidation efforts, and it takes leadership to pull it off. Colorado's governor, CIO and Legislature are showing lots of courage doing it this way."

A Seat at the Table

By breaking with the traditional, federated model of the CIO reporting to the central budgeting authority, and having Locatis report directly to the governor, Colorado has put a stake firmly in the ground for strong IT leadership at the highest level in government.

"As high-tech as the world and state government is today, we need to keep up, so you need to have a person at your right-hand side who is tech-savvy and who gives a status to and respect toward the work he is doing," Ritter said. "I can imagine that if Mike had not been a member of the Cabinet, other members of the Cabinet might have been more difficult to engage in the centralization initiative."

For Locatis, the Cabinet position is akin to having a CEO-CIO relationship often found in the private sector. It's also a model that Locatis hopes other states will adopt as they tackle IT transformation. "By installing me in his Cabinet, the governor has put a voice for IT at the table," he said. "In almost every meeting, I address IT transformation and IT issues with the full Cabinet, who are the executive directors of each line of business in the executive branch of government. It allows me to set the stage ... for the cultural momentum for making this transformation."


Sustainable for State Government?

With the governor's signature barely dry on the new legislation, Locatis has a full agenda to manage as consolidation begins to take hold. Projects range from a series of retreats for departmental CIOs who now report to the state CIO, to putting into operation the massive consolidation plan.

Locatis is taking a long view of the situation, pointing out the need for a "sustainable model for the state going forward" and to break down the complexity of a decentralized IT infrastructure that's locked into doing maintenance, "which consumes 80 percent of our time, leaving barely 20 percent for innovation. We want to flip that ratio around," he said.

More importantly, constituent expectations are high. The public doesn't usually understand why the fruits of IT consolidation can take so long. Citizens tend to focus on computer systems that don't work when they need customer service.

Already, critics, referring to the state's problem-plagued welfare benefits system, are questioning why Locatis spent his first 16 months on the job writing a plan, drafting legislation and persuading the Legislature to pass it when the state still has IT systems that don't perform properly. University of Denver professor Don McCubbrey told the Rocky Mountain News that "Ritter has to reset Mike's priorities. Let's get this [benefits system] behind us."

Locatis knows the state's beleaguered systems will get fixed, but consolidation and the benefits that come from an enterprise IT architecture take time, consensus, collaboration and superior IT management and governance. "Technology is going to play a critical role in helping the governor meet his promises to the state," Locatis said. "If we can get through the first term and into the second term with an eye on improvement to services, that's going to make the difference."

Ritter also realizes that turning IT around takes time, but he has high expectations too. "I want to test the envelope for online services in Colorado," he said. Ritter's vision is to leverage the sharing of now-siloed data so that it can support sound policy decisions and provide the evidence to understand how one policy decision might impact another. "Data shared across agency lines lets us look at several different things at once, such as the impact of child health care on child education levels," he explained.

Ritter, backed by Locatis, has the vision of how state IT should be transformed and the foresight for why it must change. The question remains whether the two can overcome the status quo and bring about change on an enterprise scale with lasting benefits.

It won't be easy, and the country's public-sector IT community will be watching as the most comprehensive state IT consolidation effort gets under way.

Tod Newcombe, Editor Editor, Public CIO

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