Shared Services for the Public Sector
by David Zolet
Shared services make sense for the public sector. Managers in most if not all government agencies want to complete their missions more effectively while controlling costs and reducing risk. These are precisely the tasks for which shared services offer an ideal solution.
Historically, most federal agencies have displayed the “not-invented-here” syndrome, rejecting the notion of sharing all but the most mundane services. Payroll processing from a common supplier may be acceptable. But for all IT and business services, federal agencies have preferred to do it themselves.
What’s more, federal agencies did not feel the same competitive pressures that drove commercial enterprises to adopt shared services. While businesses pinched their pennies through a long recession, federal agencies were in growth mode. Saving money simply wasn’t among their top concerns.
Public sector budgeting practices and mindsets also worked against the government’s wider adoption of shared services. In the business world, a manager can expect approval for any plan that spends $1 today to save $2 next year. But in the public sector, that’s not the case.
Government budgets are appropriated (and evaluated) on an annual basis, providing few incentives for long-term savings. Unlike their business sector counterparts, public sector managers who overspend this year in order to save money in the following year gain no benefit.
But all of this is changing, and fast. Federal agencies are now looking for serious budget reductions. In the United States, the federal government faces a $15.8 trillion (and growing) deficit, and serious efforts at reducing that debt are under way. One approach is a recent fiscal policy known as “sequestration”; essentially, it’s a way for Congress to cut federal spending.
Another effort is the Shared First initiative of the U.S. Office of Management and Budget, which requires federal agencies to move at least some of their IT systems to a shared-services model.
These budget pressures are giving public sector managers a reason to shift their mind-set. In the past, government managers were curious about commercial solutions. Now they’re demanding them.
Low cost, low risk
Shared services are one of several commercial solutions that CSC can bring to bear for our federal clients. We can also provide these solutions at low risk. After all, we’ve done it at scale in the commercial space for many years. Thanks to our years of direct experience, we fully understand the requirements of shared services, IT as a Service, cloud computing and cybersecurity. We can demonstrate to our public sector clients how these various technology solutions can help them control spending.
One great example is CSC BizCloud for Government. This shared-service offering for the public sector is based on a solution CSC developed earlier for its commercial sector clients. We then adapted the solution for federal clients, so that BizCloud for Government combines the privacy, security and control of a private cloud with the agility, elasticity and convenience of a public cloud.
Those privacy and security features are the direct result of both CSC’s 50 years in the government market and our extensive cybersecurity practice. Flexibility comes from the fact that BizCloud for Government is delivered on a pay-as-you-go, rate-card basis. Best of all, BizCloud for Government can be ready for production workloads in just 10 weeks. That’s a huge advantage for public sector managers looking for quick results — which is to say, nearly all of them.
And for clients who prefer an on-premises solution that lets them share services among their internal units, CSC offers solutions, too. For example, we currently operate the NASA Shared Services Center in Stennis, Miss., helping the space agency’s managers consolidate and pool several common back-office services into a single center.
What’s ahead? I believe our federal clients will soon lead the way to the next-generation IT infrastructure, adopting cloud computing and other shared-services approaches even before their counterparts in the business world. The future of public-sector shared services is bright indeed.
David Zolet is executive vice president and general manager of CSC’s North American Public Sector.