Industry Advisory Councils Gain Clout With State Governments

Industry Advisory Councils Gain Clout With State Governments

Charles Gerhards

By William Welsh, Staff Writer

Four years ago, when Pennsylvania officials were trying to decide how to consolidate and outsource the operations of the state's 17 data centers, they sought advice from a newly formed advisory council composed of chief information officers from the private sector.

"They had experience consolidating data centers, either through acquisitions and mergers or because this was their corporate policy," Charles Gerhards, the state's deputy secretary for information technology, said regarding the 18 companies represented on the council.

Among those companies was PNC Bank Corp. of Pittsburgh. "As a financial institution, we had been through acquisitions where we had acquired other banks and incorporated them into our data centers," said Tim Shack, PNC Bank's CIO and an advisory council member.

The council gave this sage advice: Focus on personnel issues as much as the technical issues.

Because the state was going to be displacing about 200 people by outsourcing, it faced the difficult job of gaining the confidence of people whose jobs were being eliminated. The council "told us we needed to find ways to have these people help us, even while they might be losing their jobs," Gerhards said.

The state feverishly began retraining these employees. As a result, only one person was furloughed, while every other employee that remained with the state found a job in network administration, desktop support or application development, Gerhards said. And today, the state is well into the second year of its seven-year, $500 million data center outsourcing deal with Unisys Corp. of Blue Bell, Pa., the largest successful IT outsourcing project by a state government to date.

Using an industry advisory council to help shape and guide government IT projects has caught on not just in Pennsylvania, but throughout the country, according to state CIOs and advisory council members. Many state IT executives are finding the private-sector advisory councils can help them enhance their leadership authority, build consensus among agencies and avoid compromising their visionary ideas.

"Every state has put something [like an advisory council] in place to address IT management on the whole or to address specific topics," said Aldona Valicente, Kentucky CIO and president of the National Association of State Information Resources Executives, a Lexington, Ky., organization representing state CIOs.

Pennsylvania's CIO advisory council not only played a major role in data center consolidation, but the council also has influenced other statewide projects involving standardization, such as desktop software, telecommunications services and enterprise resource planning software, Gerhards said.

In staffing the council, Pennsylvania deliberately chose companies that have first-hand experience with standardization and companywide projects. The council meets on a quarterly basis and includes CIOs from a variety of sectors, including financial, manufacturing and petroleum.

Because Pennsylvania's CIO Advisory Council does not include officials from IT companies, the chance of a conflict of interest is practically nonexistent, Gerhards said.

Also, the discussions don't involve specific products or vendors, so the likelihood of a conflict of interest becomes even more remote.

"We didn't want pure technology companies giving us advice," he said. "What we wanted was corporate America helping us shape our business.... These corporate CIOs know we aren't there to hear marketing from vendors, and they don't want [to participate] in anything that is like a marketing environment."

Kentucky also has chosen not to include technology companies, partly because there aren't that many located in the state, said Valicente.

But like Pennsylvania, Kentucky will staff its council with CIOs who work for companies that use IT heavily.

Unlike Kentucky and Pennsylvania, the advisory council in Virginia includes IT companies such as Booz-Allen & Hamilton Inc. of McLean, Va., ServerVault Inc. of Dulles, Va., Lucent Technologies Inc. of Murray Hill, N.J. and Verizon Communications of New York.

In this setting, companies are able to share their expertise, said James Donehey, CIO of ServerVault and a member of the Virginia advisory council.

For example, ServerVault, which specializes in electronic security, can advise the state on security issues relating to communications, data and personal information. "We can help the state do a technical comparison on a project," he said.

Virginia's CIO advisory council was recently reappointed and given a specific agenda by Secretary of Technology Donald Upson.

The agenda includes continuing to provide input on technical and managerial as well as advocating IT initiatives to the Virginia General Assembly.

"If there are changes I am proposing when I go to the legislature, then I will use them to back me up," Upson said. "For the secretary of technology to say something to the legislature is one thing, but stakeholders saying it [to the legislature] is another thing altogether. I want and need their support, knowledge and expertise behind my recommendations."

Donehey also acknowledges the council's unique role. "We can serve as expert witnesses, so to speak, before the legislature, and this can lend tremendous credibility [to the secretary of technology]," he said.

Beyond the satisfaction of helping the government, the members of the Pennsylvania CIO advisory council occasionally get some useful information from the state that they can take back to their companies, Gerhards said. "It has become a peer relationship," he said.

For example, the council members showed a keen interest in how state officials put together the statewide telecommunications network, and also were impressed at the state's success with IT recruitment and retention, Gerhards said.

While the loss of IT personnel typically runs at 8 percent in the private sector, Pennsylvania's loss rate is 4 percent, said Gerhards, "and they want to know how we did it."

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