Kelso a man with many hats

Clark Kelso

Mark Morris

How much more can Clark Kelso do? Last spring, California Gov. Gray Davis appointed Kelso state chief information officer. This April, he agreed also to serve as interim director of the California Department of General Services until a full-time director can be found. He's holding down both jobs while keeping his position as professor of law and director of the Capital Center for Government Law and Policy at the University of the Pacific's McGeorge School of Law in Sacramento.

From his perch atop the Department of General Services, Kelso has a bird's eye view of the procurement reform effort launched last year after state procurement officials awarded an enterprise software contract without competition to Oracle Corp. of Redwood Shores, Calif. The state later rescinded the contract.

Kelso talked with Washington Technology Staff Writer William Welsh about California's information technology initiatives, procurement reform, and the role he expects contractors to play in a state that spends about $2 billion annually on IT products and services.

WT: What marching orders did the governor give you when you became interim director of the Department of General Services?

Kelso: Two things. The first was to maintain the momentum with the procurement reform effort; it's an outgrowth of the Oracle situation. The governor appointed a task force last year, and it conducted hearings and came up with 18 recommendations. Some already have been implemented; others are in the planning stages. The first priority is to make sure we don't slow down the reform effort.

WT: And the second priority?

Kelso: The governor wants the department, which is responsible for much of the state's contracting, to find as much savings as possible in contracts and leases. We've set a target of about a $50 million general fund for savings in contract and lease costs. We're figuring how to help departments realize savings on that scale.  

WT: How can the vendor community help you with that?

Kelso: They can drop their prices. For the vendor community, particularly in IT, where it is a very weak market, now is the time that the most successful companies for the future are going to drop their prices and grab market share and beat out the competition. Now is the time for the vendor community to be especially aggressive in price and to be especially creative in structuring the transaction to achieve the lowest price.

WT: What were some of the specific procurement reform recommendations?

Kelso: One of them is the creation of a Web-based contract registration system where every contract greater than $5,000 is going to be registered with that system, and certain information about the contract ? the vendor, the type of contract, etc. ? is going to be included there. It provides us with a real-time database of the state's contracting.

There are two aspects to that. First, we've never really had a database of the state's contracting, so we've always had to make estimates of how much we're contracting. ... It is going to permit us to get a grip on how much we are contracting and whom we are contracting with. You can start thinking about doing strategic sourcing decisions, looking across departments to see where there is some commonality and use it as a tool to enforce the rules of contracting.

Second, one of the major recommendations was to invest in creating a training program, and then train the state's procurement work force. We had done a self-assessment survey earlier in the year, which showed that our own procurement and contracting officers really didn't think they knew enough about procurement rules and regulations. So we made a determination to create a substantial training program.

Another recommendation is to try to bring some greater clarity and consistency to the state's statutes and regulations dealing with procurement. We have four or five different sources for procurement rules. Anybody who is trying to learn the rules and follow them is met with a bewildering variety of documents that they are supposed to check. We have under way an initial analysis of what it takes to rationalize that system of rules.

 WT: Will state agencies be using the California Master Award Schedule less in the future as a result of the procurement reforms?

Kelso: No. We are not retreating from [the schedule] and the use of master service agreements. We are probably going to be adding some processes that make it somewhat less attractive ? the requirement that you get three quotes ? but I don't view that as an especially onerous requirement. It seems to me quite prudent. You can't just pick a contractor out of the Yellow Pages. Nobody who has any sense will shop that way. 

WT: Has there been any legislative action or progress on the IT governance plan proposed by the administration last year?

Kelso: It's sitting in the [California] Assembly and probably will be scheduled for a committee hearing in the next couple of weeks. Frankly, there has been so much else going on, it just hasn't been anyone's focus or concern.


WT: Are there any IT enterprise initiatives under way?

Kelso: The controller's office is going to begin moving forward with replacing its payroll system, which has statewide implications. It's primarily a controller's system, but one that is of enterprise scope.

We have announced that we will be consolidating two of our data centers, the Teale Data Center and Health and Human Services Data Center, effective next July 1. I have a working group that began meeting last week to begin planning how that will happen. We expect there will be significant enterprisewide savings and advantages from that type of consolidation.

We've announced that we are going to move toward a centrally managed messaging services structure. Instead of departments doing their own e-mail, they are going to get messaging services from a single data center.

WT: Despite the budget situation, is IT governance and reform still a priority issue for the governor?

Kelso: It is still a priority. The things that we are doing respond to the budget and to homeland security issues. One of the reasons to consolidate is big savings. The other major reason is to get greater control over your infrastructure as a prudent security measure. I've spoken in terms of reducing our "perimeter" and our exposure to the Internet. The governor is still very much in tune with reform of the way we handle IT. It's clearly related to procurement reform as well. ... My orders are clear to continue pushing these reform efforts along as quickly as possible.

WT: What do you see as your major accomplishments in the last year?

Kelso: First, we have successfully resurrected an oversight and security program without the benefit of any statutory guidance and in very difficult budget circumstances. The Department of Finance has done a remarkable job of creating a mechanism both for oversight of IT projects and a policy-making unit for IT security at a time when we desperately need it.

Second, we have managed to create a much more collaborative environment for IT development. [It is] collaborative between departments, control agencies and departments, and the data centers. I believe that is a very good thing, because ultimately enterprisewide applications and developments require collaboration.

Third, you're beginning to see the outlines of a strategic direction for the state IT program. Now, I don't have a document that's called a strategic plan. I deliberately avoided trying to do that this year. We didn't have the resources to do it, and we really didn't have the specific direction to do it. [But] I believe you're beginning to see the broad outlines that will be, in three to five years, important strategic directions.

Staff Writer William Welsh can be reached at

About the Author

William Welsh is a freelance writer covering IT and defense technology.

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