Not the Montgomery Ward, but the shared services catalog

The Treasury Department isn’t quite getting ready for the Christmas buying season, but it is preparing for the shared services buying season.

Treasury will release a catalog of shared services early in 2015.

Beth Angerman, the director of Treasury’s Office of Financial Innovation and Transformation (OFIT), said the goal is to list all the services offered under the financial management initiative, the price range and what’s in and out of scope under the financial management shared services program.

“We are opening the kimono a little,” Angerman said at Thursday at the National Academy of Public Administration’s fall conference in Arlington, Virginia. “We will document the annual agreements. It’s a step in the direction for us being transparent, and it’s an opportunity for industry to come in and say ‘You’re doing this for too much money and we think we can do more efficiently and effectively.'”

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Industry hasn’t been overly excited about the Obama administration’s shared services program as it’s focused on agencies moving only to federal shared services providers. The Office of Management and Budget named four shared services providers in May.

Angerman has said over and over again that industry has the opportunity to participate in this initiative through support roles, and by bringing innovation to the market.

The catalog is one approach to get industry more involved in the initiative.

“If we have to revisit supply of shared service providers based on demand, we gave ourselves the freedom of being able to do that,” Angerman said. “We had a lessons learned party recently where we brought all customers and shared service providers in and spent the day learning from each other. One of things they said that works well is they get to work with another federal agency that truly understands the workings of the government and that is leading to the success of the implementation efforts.”

The catalog is one of several steps Treasury and OMB are taking to usher this initiative toward more solid ground.

Treasury released two separate guidances in September. The first document addressed the rules for the financial management shared services marketplace in an effort to guide the implementation of OMB and Treasury’s long-term vision. The second document focuses on the federal shared service provider and customer agency relationship during the operations and maintenance (O&M) phase of the systems development life cycle.

Angerman said Treasury is working on additional guidance to help agencies based on the lessons a handful of large agencies which are early in the migration effort.

She said the guidance will be more in the weeds trying explain where the challenges are, such as how important it is to have a project management office in place from the beginning. The PMO also must include an independent verification and validation (IV&V) function and data migration support.

Those lessons aren’t just ethereal. Agencies such as the Homeland Security Department and the Department of Housing and Urban Development are hitting potholes no matter how careful they think they are driving this shared service car.

Chip Fulghum, the DHS chief financial officer, said the biggest risk is data migration.

“When you sit down with the shared service provider, you get can’t beyond two minutes without them saying, you have to have your data ready to go,” he said. “We are focusing on it early, and already in the learned lessons, we know that’s not soon enough.”

Fulghum said one of the biggest complexities is how does the SSP deal with DHS’ integrated procurement system. He said the acquisition community is not as far along as the financial management systems community.

“We’ve pushed Treasury on the fact that it further hinders our ability to pick a shared service provider because FM integration with procurement services isn’t happening yet,” he said. “We need to push other lines of businesses down the shared services provider path.”

Brad Huther, HUD’s chief information officer, his agency doesn’t have enough skilled workers to take address data migration and project planning challenges.

“In part of our review last week, we didn’t have data conversation in the project plan addressed adequately,” Huther said. “This creates an opportunity for us to migrate away from our weak financial analytical capabilities inherent in our current system, and it creates opportunities for us to transition our employees to the next generation of financial advisory services, which defines what we are trying to get out of this.”

Despite the long-standing challenges and slow moving initiative, OMB already is looking at expanding the SSP to other functions, including acquisition.

“My goal in the next six months is to bring all the initiatives together, where it makes sense and then we’ll need to step back and ask what is the best organized construct going forward, and do we have the funding mechanism to actually create a shared service where you have buyers and sellers, where sellers are retaining funds,” said Dave Mader, OMB controller. “Another thing we will take on in next couple of months will be what the optimize design will look like for shared services.”

Mader said success in shared services will come mainly because of leadership. He said the technology and business process reengineering aspects are extremely important, but having senior executives lead the culture change on a consistent and long-term basis is the only way to achieve real transformation.

This post is part of Jason Miller’s Inside the Reporter’s Notebook feature. Read more from this edition of Jason’s Notebook.