4
Toward Organizational Transformation for Electronic Service Delivery

This study’s charge is to examine the Social Security Administration’s (SSA’s) strategy for expanding its provision of electronic information and services. Developing a forward-looking strategy for electronic service delivery requires more than just an understanding of the organization’s current technological infrastructure and capabilities. Successful service-delivery strategies are grounded in an understanding of the organization’s strengths, the constraints under which it must operate, and the nature of the organizational support for (or resistance to) a new or updated vision of service delivery. As a result, an understanding of the organization’s culture and its approach to both technology and service provision is also necessary.

This chapter provides a high-level assessment and set of impressions regarding the SSA’s organizational culture and approaches to service provision on the basis of input that the committee received over the course of this study. The chapter also explores how the SSA’s organizational culture, leadership, management choices, and policy choices may affect the agency’s ability to plan and execute a new service-delivery strategy that emphasizes electronic services. It presents a set of findings and recommendations to assist the SSA in effecting a transition to the future.1 The

1

As in Chapter 3, note that this overview is of necessity brief and based on comparatively small amounts of data and input. A comprehensive assessment of such a large organization was outside the scope of this committee’s activities; the committee tried to focus particularly on the capabilities and functionalities related to electronic services provision.



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Social Security Administration Electronic Service Provision: A Strategic Assessment 4 Toward Organizational Transformation for Electronic Service Delivery This study’s charge is to examine the Social Security Administration’s (SSA’s) strategy for expanding its provision of electronic information and services. Developing a forward-looking strategy for electronic service delivery requires more than just an understanding of the organization’s current technological infrastructure and capabilities. Successful service-delivery strategies are grounded in an understanding of the organization’s strengths, the constraints under which it must operate, and the nature of the organizational support for (or resistance to) a new or updated vision of service delivery. As a result, an understanding of the organization’s culture and its approach to both technology and service provision is also necessary. This chapter provides a high-level assessment and set of impressions regarding the SSA’s organizational culture and approaches to service provision on the basis of input that the committee received over the course of this study. The chapter also explores how the SSA’s organizational culture, leadership, management choices, and policy choices may affect the agency’s ability to plan and execute a new service-delivery strategy that emphasizes electronic services. It presents a set of findings and recommendations to assist the SSA in effecting a transition to the future.1 The 1 As in Chapter 3, note that this overview is of necessity brief and based on comparatively small amounts of data and input. A comprehensive assessment of such a large organization was outside the scope of this committee’s activities; the committee tried to focus particularly on the capabilities and functionalities related to electronic services provision.

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Social Security Administration Electronic Service Provision: A Strategic Assessment chapter concludes by laying out a vision of government in which information technology (IT) has transformed the service-delivery process. ORGANIZATIONAL CULTURE AND ITS IMPLICATIONS Organizations and individuals in organizations make decisions about the technologies that they will design and deploy for a variety of reasons, some stemming from the organizational culture. This section discusses some potential impediments in the realm of organizational culture to an effective transformation of the SSA’s service-delivery strategy. To be sure, some of these potential impediments, including a cautious approach and instincts to preserve the status quo, are inherent in any large organization and especially in government organizations. Nonetheless, such impediments present a particular challenge when an organization reaches a critical juncture such as the one that faces the SSA now. Organization and organizational culture—especially as they relate to structure, decision-making processes, approaches to problem solving, service provision, change management, and so on—are significant determiners of the success of any large organization’s attempt to make fundamental and critical changes. By “cultural issues,” the committee is referring to a combination of history, leadership, existing social and political relationships, overarching regulations and rules, and existing operational procedures that determine or influence the agency’s activities and ways of doing business. The experience of industries such as the financial services industry demonstrates that development, deployment, and integration of electronic services entail just such critical and fundamental change. Culture has an effect at all stages and in all components of any path forward in this area. Thus, the committee has examined relevant SSA cultural issues in order to ensure a more complete and well-rounded report and a more relevant and realistic set of recommendations. To provide a historical context and a variety of perspectives, this section draws on presentations and discussions from meetings of the committee, the findings of previous National Research Council reports, General Accounting Office (GAO; now Government Accountability Office) reports and testimonies before Congress, and various consultants’ reports. Together, these sources provide strong evidence that organizational culture has been a challenge to past attempts to improve electronic services provision at the SSA. Moreover, despite these previous findings, the organizational culture does not seem to have changed or evolved as quickly as it could (or should) have.

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Social Security Administration Electronic Service Provision: A Strategic Assessment The SSA’s Organization and Culture—Features and Issues The SSA is a very large government institution with a long history of valuing and providing personal service to the people of the United States.2 It has built up an impressive infrastructure over decades to support its overriding objective of providing effective personal service to its beneficiaries. It has adopted as its organizational structure a traditional hierarchical bureaucracy of the sort that most large organizations have viewed as a model of efficiency since the Industrial Revolution. However, information technology (IT) advances—of which a hallmark is the widespread availability of information at the fingertips of most employees—that have the potential for transforming work processes and service delivery were not envisioned when the industrial model was developed. During its study and associated briefings and conversations, the committee noted that there seemed to be an understanding of the promise of an IT-enabled organizational transformation and of its potential for supporting electronic services delivery. But the promise of such a transformation seemed to be outweighed by the concern of the organization and many of its people for the impact of such a change on SSA users and beneficiaries. The SSA is not unique in facing cultural and organizational challenges in attempting to pursue innovative initiatives, especially those relating to the implementation of electronic information and services. In 2001, major findings from studies of the U.S. government’s experiences in the development of e-government examined the strong role of embeddedness and culture.3 In that work, “embeddedness” refers to the fact that information systems are embedded or situated in organizations with complex histories, existing social and political relationships, overarching regulations and rules, and existing operational procedures. The study found that embeddedness can indeed cause cultural issues to become important factors in determining the success of an organization’s efforts to innovate. Researchers in organizational theory have found that adopting innovative technologies and procedures can significantly affect an organization’s culture because their adoption usually cuts across organizational bound- 2 The SSA operates a vast network of some 1,500 offices and 65,000 staff distributed throughout the country (see Chapter 1). The agency’s policy is to provide customers with a choice in how they conduct business with the SSA. Options include visiting or calling a field office, calling a toll-free number, contacting the SSA through the mail, or, in some cases, using Social Security Online, the agency’s Web site at http://www.ssa.gov. In addition, 54 state Disability Determination Service (DDS) agencies make initial and ongoing disability determinations. 3 Jane Fountain, Building the Virtual State: Information Technology and Institutional Change, Washington, D.C.: Brookings Institution Press, 2001 (hereafter cited as Jane Fountain, Building the Virtual State).

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Social Security Administration Electronic Service Provision: A Strategic Assessment aries.4 Coming to realize this can then cause the organizational culture to resist the innovations. The diffuse nature of electronic service responsibilities across the agency and the SSA’s e-government initiative can be seen as an example of innovation that generates such resistance. This innovation may be perceived by some as threatening the institutional status quo. The result seems to be difficulty in undertaking innovative strategies—that is, making significant changes, such as moving strongly to electronic services—because the organization has a strong investment in preserving its own culture (although, as is often the case, this is not necessarily a deliberate choice). Moreover, there are admittedly reasons for defending the status quo—the SSA’s ultimate mission of serving its beneficiaries (and issuing millions of checks on time each year to millions of beneficiaries) has been successful. All of this suggests that the SSA’s organizational culture is a factor that must be considered and dealt with if the promise of an IT-enabled organization, structured to support the kind of electronic services that are increasingly expected by society at large, is to be achieved. These observations about the impact of the SSA’s organizational culture and resistance to change become increasingly important because the technological and social environments in which the SSA operates are changing rapidly, making the alternative of an IT-enabled organizational transformation an increasingly attractive alternative for supporting effective operation and service delivery. The number of the SSA’s beneficiaries will soon expand rapidly as baby boomers retire or qualify for disability. For example, since the year 2000, the number of people who file for disability increased by 500,000 a year, an increase of 25 percent.5 At the same time, the scale and scope of the SSA’s services continue to grow. Service Culture Issues From what the committee observed, the SSA workforce takes great pride in fulfilling its mission and has a very strong commitment to and long tradition of providing personal service tailored to the individual client. As a result, SSA devotes quite substantial resources today to its face-to-face and telephone service channels. In addition, the cultural mores within the SSA seem to equate electronic or online services with imper- 4 Jane Fountain, Building the Virtual State. See also, for example, Lionel Pierce, “New Government: Managing the Transformation,” Discussion Paper No. 20, 2004, available at http://www.agimo.gov.au/publications/2004/05/egovt_challenges/issues/transformation, accessed July 11, 2007. 5 Mary Mosquera, “Case Files Travel Lighter, Faster,” Government Computer News, Oct. 9, 2006, available at http://www.gcn.com/print/25_30/42177-1.html, accessed June 14, 2007.

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Social Security Administration Electronic Service Provision: A Strategic Assessment sonal service instead of recognizing this service channel as often being more responsive in terms of cycle times, convenience, user satisfaction, burden reduction, and accuracy (see Chapter 2). Personnel Issues Like virtually all federal agencies, the SSA faces a projected brain drain. A substantial number of the agency’s most experienced civil servants, who best understand the complex benefits-determination processes and interworkings of the outdated technology infrastructure, are eligible to retire. Thus, one immediate challenge involves human resources and workforce considerations. The agency’s planning estimates for the workforce indicate that just over 40 percent of the workforce will be retiring by 2014, just when the baby boom generation approaches its peak disability and retirement years. Consequently, the SSA acknowledges that a significant human capital challenge is to develop strategies to maintain a capable workforce to handle the workload increase, despite the retirement wave. To address this challenge, the SSA reports that it developed its first human capital plan in 2004, updating the plan in 2005, along with completion of its future workforce transition plan. The latter lays out the SSA’s plans to recruit, hire, develop, and retain a diverse workforce. The agency reports having hired more than 18,000 permanent employees since 2001.6 The SSA also reports that it is focused on workforce development and retention, especially for employees providing services to the public, and that it is working to improve training and development programs, including online training.7 The committee notes that the start of the SSA’s hiring wave apparently preceded completion of the 2004 Human Capital Plan. This timing raises possible concerns about the skill mix of the newly hired workforce (see the subsection below entitled “Strategic Service-Delivery Plan”). An updated employee skill mix will be needed to support technological innovations indicated as part of a modern electronic services strategy. More important perhaps is the need for new employees to bring to the SSA a fresh outlook on IT and electronic services. The SSA may find it challenging to establish a more modern employee skill mix, and the cadres of new employees who will embrace and lead a cultural transformation may encounter resistance. 6 Testimony of Jo Anne B. Barnhart, Commissioner of Social Security, before the Senate Finance Committee, March 14, 2006, available at http://www.ssa.gov/legislation/testimony_031406.html, accessed June 9, 2006. 7 Social Security Administration, Results at the Social Security Administration: Getting It Done, 2005, available at http://www.ssa.gov/performance/results/results2005.pdf, accessed June 9, 2006.

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Social Security Administration Electronic Service Provision: A Strategic Assessment Finally, it is worth underscoring that aside from the transformational issues, the SSA will continue to need to recruit and retain in-house technical expertise. Government agencies generally tend to outsource a large portion of their technical work and thus run the risk of being overly dependent on their vendors. A sufficient cadre of in-house technical experts is critical in any organization to evaluating the quality of the technology solutions that are offered. Organizational Structural Issues Although SSA programs cross organizational lines, the committee notes that the SSA, like many government agencies and other long-lived organizations, is a heavily stovepiped organization. As described in the discussion in Chapter 1 about the SSA’s current organizational structure, key elements for the development and implementation of e-government by the SSA are spread across three Deputy Commissioners’ domains—Operations, Systems, and Disability and Income Security Programs. The organizational lead for e-government is a subcomponent of Operations. Moreover, three additional units play a role in e-service initiatives—(1) the Office of the Chief Information Officer, which appears to have responsibility for IT strategy and for compliance with legislation, Office of Management and Budget (OMB) directives, and Government Accountability Office (GAO) guidance concerning IT capital and investment control, and which also works with other agencies on government-wide projects such as e-government; (2) the Office of Electronic Communications in the Office of the Deputy Commissioner, Communications, which is responsible for online informational (as opposed to transactional) content; and (3) the Office of the Chief Strategic Officer, which is responsible for strategic planning.8 As in any large organization, this stovepiping generally tends to make cross-program communications difficult, and it can greatly complicate the kind of coordination needed to ensure success in interorganizational initiatives. In particular, such dispersed responsibilities and the relatively low-level lead for e-government initiatives make success in creating an ambitious spectrum of new e-government initiatives particularly challenging. Of particular note is the effective split between the electronic services organization’s mission and that of the communications 8 This description is current at the time of this writing and the discussion is based on material from the SSA’s public Web site, “Organizational Structure of the Social Security Administration.” See http://www.ssa.gov/org/ssaorg.htm, accessed June 9, 2006, and May 30, 2007 (for up-to-date organizational information).

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Social Security Administration Electronic Service Provision: A Strategic Assessment organization—which effectively divide responsibility and authority for the Internet/electronic face of the SSA. Given the SSA’s current stage of maturity with respect to electronic services (see Chapter 2), raising the level and authority of the electronic services organization could be helpful for the organization to successfully address its challenges by making electronic services a more prominent part of its service-delivery plans. The alternative is to maintain the distributed nature of electronic services and have responsibility for various facets spread across multiple Deputy Commissioners’ domains. Although analogous experiences in the private-sector financial services industry (see Chapter 2) indicate that resistance to such changes can be expected, those experiences also suggest that these changes are important, both to support the move to electronic services and to precipitate needed cultural change. Risk Management in the Federal Context Being subject to constant and intense scrutiny from Congress and various federal oversight agencies understandably influences the SSA to be reluctant to assume risk. Yet failing to make needed changes can incur costs that can eventually outweigh the risks incurred in making such changes. There is a larger need to institutionalize effective risk management in order to make increasingly accurate assessments of both the upside and the downside risks from decisions both to make and to defer change. A 1990 report of the National Research Council on the SSA’s systems modernization strategy observed that “the SSA’s intrinsic problem is one compounded of mammoth size, an external expectation for inherent agility to accept change, a built-in inertia that impedes change, often late-breaking changes, and all overlaid with a demand for maximum accuracy and stable operations. So far as the nation is concerned, the SSA is a big information production line that must deliver checks to its clientele consistently and with certainty.”9 The desire to avoid “more bad publicity” is a factor that seems to have significantly reinforced a cautious organizational culture. In 1997, the Personal Earnings and Benefit Estimate Statement (PEBES) situation (also mentioned briefly in Chapter 2) garnered the SSA significant negative attention. Privacy concerns among the public and among privacy advocates regarding the SSA’s implementation of Internet-based access 9 National Research Council, Systems Modernization and the Strategic Plans of the Social Security Administration, Board on Telecommunications and Computer Applications, Washington, D.C.: National Academy Press, 1990.

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Social Security Administration Electronic Service Provision: A Strategic Assessment to individuals’ PEBES information gave rise to front-page news stories10 and congressional hearings.11 The SSA Commissioner quickly suspended the service.12 The PEBES experience illustrates the kind of attention that can be brought to bear on agencies such as the SSA when they implement new technologies. Although such experiences can impose costs and increase wariness regarding attempts at other kinds of changes, it is also important to assess what positive lessons can be learned. For instance, if the SSA had vetted its plans for PEBES more publicly beforehand, it might well have been able to head off some of the negative effects—by, for example, revising its authentication solution or simply by not surprising the privacy community. Such consultation prior to the launch of the new service might also have given the SSA an opportunity to present the risk-reward trade-offs before the press presented only the downside risk. Articulating the benefits of future improvements and securing the support of a broad range of users (including beneficiaries, third parties, and partners) is one way to ensure public support in case there is a mix of opinions that otherwise might derail a worthwhile service offering. A final lesson about the PEBES episode is that too much should not be made of it. Today, people are much more comfortable about (secured) online access to private information, and much more is known about how to implement online authentication. Finding: The SSA may be missing important opportunities to make sustained improvements in its service delivery because of an overemphasis on the potential risks of modernizing its service-delivery strategy and a lack of emphasis on the long-term risks associated with not revamping that strategy. Recommendation: When evaluating new electronic service-delivery initiatives, the SSA should when appropriate seek to balance risks and rewards by recognizing such upside benefits from automation as cost reduction, fraud prevention, and customer satisfaction. 10 See, for example, “Few Key Bits of Info Open Social Security Records,” USA Today, April 7, 1997, p. 1. 11 U.S. Congress, Subcommittee on Social Security, House Committee on Ways and Means, Hearing on the Social Security Administration and the PEBES Program, May 6, 1997. 12 PEBES went online in March 1997. The Commissioner suspended online receipt of PEBES data on April 9, 1997. See U.S. General Accounting Office, Social Security Administration: Internet Access to Personal Earnings and Benefits Information, Testimony Before the Subcommittee on Social Security, Committee on Ways and Means, U.S. House of Representatives, GAO/T-AIMD/HEHS-97-123, Washington, D.C., May 6, 1997.

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Social Security Administration Electronic Service Provision: A Strategic Assessment Strategic Service-Delivery Plan The GAO made recommendations in 1993 and again in 200013 that the SSA complete a service-delivery plan to ensure that its human capital and other key investments are put to the best use. In 1998, the agency took a first step by beginning a multiyear project to monitor and measure the needs, expectations, priorities, and satisfaction of customer groups, major stakeholders, and its workforce. In 2000, the SSA took another step by completing a document that articulated its vision for how the agency would function in the future.14 However, the overall impression of the committee is that the SSA has been slow to develop and implement strategic service-delivery plans, despite repeatedly being encouraged to do so by outside auditors and experts. The reasons for this are not entirely clear, although cultural issues, sometimes driven by external factors,15 are likely at least partially responsible. Contributing factors may be a lack of sustained leadership commitment over the years and an organizational culture that appears to equate electronic or online services with impersonal rather than more-responsive service. Here too, these cultural predispositions need to be overcome in order to enable the SSA to embrace the proactive planning needed as the basis for electronic service-delivery initiatives. As the committee noted above in the discussion of the retirement and hiring waves, the SSA sometimes takes actions with enduring consequences in advance of a strategic plan for action.16 This way of proceeding has led to outside criticisms of the SSA’s workforce and technology initiatives as being developed out of sequence and lacking a cohesive 13 See U.S. General Accounting Office, Testimony Before the Subcommittees on Human Resources and Social Security, Committee on Ways and Means, House of Representatives, SSA Customer Service: Broad Service Delivery Plan Needed to Address Future Challenges, Feb. 11, 2000; and U.S. General Accounting Office, Testimony Before the Subcommittee on Social Security, Committee on Ways and Means, House of Representatives, Social Security Administration: SSA Needs to Act Now to Assure World-Class Service, T-HRD-94-46, Washington, D.C., Oct. 28, 1993. 14 Social Security Administration, Social Security 2010 Vision, Office of the Commissioner, SSA Pub. No. 01-016, September 2000. 15 Such factors include everything from congressional requirements, to executive branch mandates, to employee resistance to reorganization, and so on. The committee does not seek to downplay these factors in any way, but making recommendations to these organizations is outside the scope of this report. 16 See U.S. General Accounting Office, GAO Report Performance and Accountability Series: Major Management Challenges and Program Risks, Social Security Administration, Washington, D.C., January 2003. GAO found that the SSA was taking human capital measures in the absence of a concrete service-delivery plan to help guide its investments.

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Social Security Administration Electronic Service Provision: A Strategic Assessment strategic vision.17 Indeed, the committee’s impression is that the SSA’s de facto service-delivery strategy appears to be oriented toward preserving existing organizational structures and mores instead of responding to emerging technological capabilities and shifting user demands for more convenient service channels. The GAO also criticized what it described as the SSA’s lack of a broad vision for customer service, noting that “this broad vision, as well as a more detailed plan spelling out who in the future will be providing what service and where, is needed to help the agency focus its efforts to meet its future challenges.”18 As is expanded on later in this chapter, this committee believes that a very broad new vision of the seamless delivery of SSA information and services through different (but predominantly electronic) service media centered on state-of-the-art technology is indicated. A thorough and articulate plan is needed as the basis for proceeding toward such a vision. At the same time, the committee recognizes the difficulties that federal agencies face in projecting programmatic cost savings resulting from the use of new technologies and methods and then having to live with the consequences of those projections (e.g., budget cuts) whether or not the savings are realized. Finding: The SSA’s organizational structure does not support the establishment of a strategic focus in electronic services that is sufficiently high-level and broad-based. The SSA has an opportunity to be more proactive in fundamentally reassessing its customer service value chain and, for as many customers as possible, focusing on the potential substitution of electronic services for other delivery channels, such as paper mail and face-to-face interactions in field offices. Recommendation: The SSA should make an unambiguous, strategic commitment to electronic services as part of its long-term service-delivery strategy, placing a central emphasis on electronic services that encompass timely and up-to-date information for users, partners, and beneficiaries. 17 U.S. General Accounting Office, Testimony Before the Subcommittees on Human Resources and Social Security, Committee on Ways and Means, House of Representatives, SSA Customer Service: Broad Service Delivery Plan Needed to Address Future Challenges, Washington, D.C., Feb. 11, 2000. 18 Ibid.

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Social Security Administration Electronic Service Provision: A Strategic Assessment OPPORTUNITIES FOR CHANGE Several key issues were largely unaddressed in the briefings and documents made available to the committee: (1) what kinds of metrics and measures the agency will use to monitor and assess its efforts over time, (2) what kinds of marketing and promotion of services it will undertake in order to encourage the use of electronic services, and (3) how the SSA’s core competencies and potential partnerships could be combined to strengthen and enhance service provision across the board. The subsections that follow examine each of these questions in turn. Metrics and Measures The National Research Council’s 1990 report entitled Systems Modernization and the Strategic Plans of the Social Security Administration recommended that the SSA develop and use suitable performance metrics and measures in its management process: As part of its recommendation that the SSA adopt improved IT management processes, that study committee urged the SSA to “thoroughly forecast and justify expansion and upgrade of the existing information systems infrastructure on a continuing basis; quantify and define in advance the specific performance goals to be provided its clients; measure and monitor actual performance [emphasis added]; and plan for the orderly introduction of new services consistent with available personnel and budgetary resources.” With respect to service quality, the same committee recommended that “the Social Security Administration quantify each aspect of service quality (e.g., elapsed time to complete), monitor its overall performance, and manage against such a priori service goals [emphasis added].”19 This committee concurs with the above conclusions. The establishment of metrics to evaluate the effectiveness of various services and delivery channels is an important component of a service-delivery plan. Such metrics are complemented by the establishment of specific, agreed-on operational approaches to measurement. Although a typical cost measure is dollars, benefit measures may be difficult to monetize. Careful discussion that involve user communities (such as beneficiaries, third parties, partners, and SSA employees), can be useful in coming to consensus about 19 National Research Council, Systems Modernization and the Strategic Plans of the Social Security Administration, Board on Telecommunications and Computer Applications, Washington, D.C.: National Academy Press, 1990, p. 4.

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Social Security Administration Electronic Service Provision: A Strategic Assessment Finding: The SSA’s present direction diverges from the three-phase progression that large financial institutions have followed in successfully developing and launching electronic services. Recommendation: In order to move to the second phase of electronic services maturity, the SSA should create a focal point responsible for developing and managing electronic information and service delivery—including components such as Web content, online transactions, user interfaces, research, database systems and other key enabling technologies, and other facets of electronic service delivery that are currently dispersed throughout the SSA. This focal point should have sufficient resources to take on organization-wide responsibility for online services and should report directly to the SSA Commissioner or to a Deputy Commissioner. Embracing Change Although charting a roadmap for the future under these circumstances may be daunting, the terrain is not completely unexplored and uncharted. The SSA is a unique enterprise in some important ways, but as discussed in Chapter 2, there are many other ways in which its constraints, contexts, and clientele are similar to those under which other large-scale financial institutions must operate. The extensive stock of experiences and lessons learned by these other institutions should serve as a useful guide to the approaches that the SSA might take during its evolution toward electronic services. Studying these experiences leads the committee to a sharpened appreciation of the need to embrace and engage the overriding issue of change. However, the committee views any individual recommendation of a specific path toward a specific suite of services as subordinate to what the committee sees as a more general and overarching need: the SSA should embrace change as a factor in the way that it makes plans for the future and in the way that it does business. Particularly as change in the various domains of SSA involvement continues, it will become increasingly important for the SSA to devote attention and resources to being well informed about the nature and ramifications of these changes, both for itself and for its various user chief executive officer as the new IT head. The key to the success of the e-business activity was an e-business vision and a corresponding architecture designed to Web-enable as many services as possible. The vision and the architecture were required as a context for the many component technology solutions, but these would not have succeeded without the revolution. Personal communication from Michael Brodie, Distinguished Architect, Verizon Communications, to Lynette Millett, August 18, 2006.

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Social Security Administration Electronic Service Provision: A Strategic Assessment groups, including beneficiaries. Although the SSA does pay attention to change and seeks advice externally and internally, there are opportunities to use that advice more systematically as a basis for sustained and effective action. Broader and more systematic attention to anticipating and addressing change is warranted. Finding: The SSA faces significant ongoing change—in terms of technology, demographics, and public expectations—as it carries out its activities, services, and interactions with a variety of user communities. Recommendation: The SSA should embrace change as a constant. It should regularly evaluate emerging trends in such areas as technology (for example, database technologies) and business practices (for example, by learning from the experiences of financial institutions and moving toward the use of strategic partnerships for efficiency and effectiveness). It should also regularly evaluate the changing societal attitudes and expectations of its various user communities. The SSA should also institutionalize the formulation of strategies for addressing these trends. The aim of this report is to present a forward-looking vision and set of recommendations for the SSA to keep in mind as it strives to achieve the kind of technological and cultural transformation needed to best reflect and reinforce the existing and admirable, deeply grounded institutional commitment to its beneficiaries. The next section provides a brief description of governmental transformation conceived broadly that lays out a forward-looking vision for the SSA as it seeks to bring about the kinds of change that will be needed in the years and decades ahead. THE PROSPECT OF GOVERNMENTAL TRANSFORMATION As the SSA develops and implements its electronic services strategy, what the agency is attempting to achieve is taking place within a more comprehensive shift to electronic service provision across the federal government. The visions of e-government discussed below describe the transformative effect of automating and reengineering processes that enable the government delivery of information and services using technology in several different ways. (See Box 4.1 for specific prospects for IT-enabled process transformation at the SSA.) This transformation might also be thought of as a convergence—of user experience, data, or organization. For example, a convergence of user experience might be the ability of users to access all SSA program information and transactions easily through a Web portal. Data

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Social Security Administration Electronic Service Provision: A Strategic Assessment BOX 4.1 Information Technology-Enabled Process Transformation In many cases in both the public and private sectors, organizations implement technologies in ways that implicitly reinforce the political status quo.1 This phenomenon is referred to as “technology enactment.” The term often (but not always) refers to the tendency of actors to implement new information technology (IT) in ways that reproduce or even strengthen institutionalized, sociostructural mechanisms. This can occur even when such enactments lead to seemingly irrational and suboptimal uses of technology.2 As a simple example, navigational principles for an institution’s Web site may appear mysterious to an external user because the organization of information on the Web site mirrors the organizational chart of the institution rather than reflecting likely functionalities or information resources that external users might be interested in.3,4 This suggests that if a Web site merely mirrors an organization’s internal structure, if that organizational structure is not optimally designed for electronic services, the Web site will not be either. Similarly, most telephone book listings for government offices are organized by agency structure, not by citizens’ needs. If one wants to complain about the speed of traffic in front of one’s home, it is often not clear which city organization to call. Many of the calls to a general city number are in service of finding out just whom to call. A telephone book listing that met the user’s goal (for example, road complaints) would eliminate the need for people whose primary job is to route calls. A 1990 National Research Council (NRC) study committee made a number of recommendations related to Social Security Administration (SSA) systems mod-    1Jane Fountain, Building the Virtual State: Information Technology and Institutional Change, Washington, D.C.: Brookings Institution Press, 2001.    2Jane Fountain, Building the Virtual State: Information Technology and Institutional Change, 2001.    3Jane Fountain, Building the Virtual State: Information Technology and Institutional Change, 2001.    4At one of this study’s open sessions, Ben Shneiderman, University of Maryland’s Human Computer Interaction Laboratory, presented principles of good Web site design and methods for doing usability testing. He found the SSA Web site to be difficult to navigate intuitively. As discussed previously, a potential reason that the SSA Web site presents navigation challenges is that it may be mirroring the internal organizational structure of the SSA. convergence might manifest itself in a user’s being able to see all of his or her data and program eligibility information from the SSA on a single page within the portal. Organizational convergence would mean that users could understand the interrelationships among the various SSA programs from a user’s perspective, not based on the SSA’s organizational

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Social Security Administration Electronic Service Provision: A Strategic Assessment ernization.5 Some of those earlier recommendations can be applied to the SSA today in the context of rethinking the agency’s strategy for service delivery. For example, that NRC committee found that a particular target of opportunity was disability processing, which in 1990 was almost exclusively a paper-based file operation that consumed a disproportionate share of operating budget. Although the SSA tried to redesign the disability processes during the 1990s, the implementation largely failed.6 Today, while the agency is deploying an electronic disability system, that system largely automates the existing paper-based file processes, not capitalizing on the simplicity that the digital medium offers. The result of this approach is that users and the government get fewer benefits, such as reduced cycle times, lower error rates, and decreased cost per transaction, than might otherwise be possible through a more thorough transformation. The present committee does recognize that in early 2006 the SSA Commissioner announced a major overhaul and streamlining of the disability-determination processes.7 The changes are largely process changes, and the extent to which strategy and planning for procedural and technical changes (for example, for the current Electronic Disability system, eDIB) were coordinated within the SSA is not clear. In general, the SSA’s various services are furnished through the execution of a variety of intricate processes. Other industries and financial institutions report impressive gains from disciplined overhauls of existing basic business processes, carried out in order to take advantage of new efficiencies and functionalities offered by information technology. Given its imminent workload and workforce challenges, the SSA would be well served by being proactive in transforming its processes to make the best use of both its human capital and its IT investments. Process transformation of this sort will of necessity be closely tied to and dependent on the modernization and overhaul of the database systems as described in Chapter 3 of this report.    5National Research Council, Systems Modernization and the Strategic Plans of the Social Security Administration, Board on Telecommunications and Computer Applications, Washington, D.C.: National Academy Press, 1990.    6See Social Security Advisory Board, How SSA’s Disability Programs Can Be Improved, August 1998, pp. 6-8, available at http://www.ssab.gov/Publications/Disability/report6.pdf, accessed July 11, 2007; and Social Security Advisory Board, Charting the Future of Social Security’s Disability Programs: The Need for Fundamental Change, January 2001, pp. 15-18, available at http://www.ssab.gov/Publications/Disability/disabilitywhitepap.pdf, accessed July 11, 2007.    7Social Security Administration, “News Release: Commissioner Barnhart Unveils New Social Security Disability Determination Process,” March 28, 2006. For more information on the changes, see http://www.ssa.gov/disability-new-approach/. structure. These types of convergence could bring to fruition the best possibilities of e-government. Depending on the underlying strategic goals of e-government, which may vary depending on, for example, the political leadership driving the changes, the attendant benefits of such convergence can take the form of streamlined government organiza-

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Social Security Administration Electronic Service Provision: A Strategic Assessment tions, improved service delivery, and/or more participatory decision making.36 Convergence of User Experience and Data The envisioned transformation of government information and service delivery begins with a radically transformed user experience. Web portals are one technology platform that is helping to bring a more user-centric perspective to government.37 E-government offerings will increasingly target market segments (for example, students); life events (for example, buying a house); or role (for example, small business owner versus nonprofit treasurer) to help insulate users from the complexity of government programs and organizational structures. This transformation would require government to think “outside in” in terms of users needs (see Chapter 1 for examples) instead of focusing on how agencies are divided by program, level of government, or unit within level of government. There is little more frustrating for an individual using government-provided electronic services than having to reenter the same data sets for different offices in one federal agency to complete one transaction. Privacy concerns notwithstanding, users may reasonably ask, “Why doesn’t my government have its act together?” Users are becoming increasingly accustomed to and comfortable with private-sector organizations with which they transact business having a more holistic understanding of who they are as a customer. Whether it is a financial services organization or a retailer, users have come to expect that those businesses understand them as a customer across organizational units, products lines, or service channels. An existing customer of a large financial institution might reasonably expect that if one has car insurance and wants to buy homeowner’s insurance from the same institution, a person will not be starting from scratch in filling out the application for the new product—at a minimum, an agent might provide a pre-filled-out application as a starting point. What enables this customer-centric view is data convergence. These businesses have either organized and consolidated their data centrally, or they have 36 D.M. West, Digital Government: Technology and Public Sector Performance, Princeton, N.J.: Princeton University Press, 2005. 37 See D.B. Gant, J.P. Gant, and C.L. Johnson, “State Web Portals: Delivering and Financing E-Service,” Endowment for the Business of Government, Arlington, Va., Pricewaterhouse Coopers, January 2002, available at http://www.businessofgovernment.org/pdfs/JohnsonReport.pdf; and V. Jupp and S. Shine, “Government Portals—The Next Generation of Government Online,” pp. 217-223 in Proceedings of the First European Conference on E-Government, Dublin, Ireland: Trinity College, 2003.

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Social Security Administration Electronic Service Provision: A Strategic Assessment linked disparate data stores to create a holistic view of the customer, often relying on customer relationship management (CRM) systems. Organizational Transformation Although many large organizations have top-down decision making, limited front-line discretion, and specialized tasks, these characteristics tend to be more pronounced in government organizations. Government organizations typically reflect the Weberian ideals of specialization of task, limited front-line employee discretion, and top-down decision making.38 These organizational and management principles reflect the prevailing wisdom when these institutions were reformed or created during the Industrial Revolution. What this means in practice, though, is that users may have to navigate through a bureaucratic maze to complete relatively straightforward transactions. Consider an entrepreneur who would like to start a business. Such a person likely would have to register his or her business, obtain tax identification numbers, comply with regulatory requirements, and generally fill out paperwork for multiple agencies at the federal, state, and local levels. Ideally, the responsible agencies for regulating, taxing, and supporting small business generation would have converged to provide a “starter-kit” for new businesses that consolidated and rationalized paperwork, regulatory oversight, and reporting requirements. This would represent not only organizational transformation, but the data convergence and transformed user experience described earlier. These transformations and the related level of convergence typically evolve over time. Although it may be possible for a government organization to outsource its electronic service capabilities and achieve order-of-magnitude improvements in convergence, such change more typically occurs incrementally. Several models have been developed to describe or predict such an evolution of e-government capabilities.39 (Figure 4.1 presents as an example a four-stage model of e-government.) These models suggest that e-government capabilities begin modestly and initially provide static, one-way information, but grow more sophisticated and add interactive and transactional capabilities. The models predict the most 38 Max Weber, “Bureaucracy,” pp. 23-29 in Classics of Public Administration, Jay M. Shafritz and Albert C. Hyde, Eds., Oak Park, Ill.: Moore Publishing, 1978. 39 See, for example, C. Baum and A.D. Maio, “Gartner’s Four Phases of E-Government Model,” Research Note, Stamford, Conn.: Gartner, November 21, 2000; Janine Hiller and Francine Bélanger, “Privacy Strategies for Electronic Government,” pp. 162-198 in E-Government 2001, Mark A. Abramson and Grady E. Means, Eds., Lanham, Md.: Rowman and Littlefield, 2001; and Karen Layne and Jungwoo Lee, “Developing Fully Functional E-Government: A Four Stage Model,” Government Information Quarterly 18(2):122-136, 2001.

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Social Security Administration Electronic Service Provision: A Strategic Assessment FIGURE 4.1 Layne and Lee’s four-stage model of e-government. SOURCE: Reprinted from Karen Layne and Jungwoo Lee, “Developing Fully Functional E-Government: A Four Stage Model,” Government Information Quarterly 18(2):122-136, 2001, copyright 2001, with permission from Elsevier. desired form of e-government, which includes horizontal and vertical integration of organization, data, and user experience that is fundamentally different from traditional forms of government service provision. This kind of convergent, transformed public service is sometimes referred to as “joined up government”—a term coined in the 1990s in the United Kingdom.40 Similar to the case in the three-stage model of 40 See, for example, Vernon Bogdanor, Joined-Up Government, British Academy Occasional Papers, Oxford University Press/British Academy, Oxford, United Kingdom, July 21, 2005; and Andrea Di Maio, What “Joined Up Government” Really Means, Stamford, Conn.: Gartner, 2004.

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Social Security Administration Electronic Service Provision: A Strategic Assessment transformation in the financial services industry, the higher the level of transformation and convergence, the higher the payoff for governments, taxpayers, and users. Joined up government also recognizes the roles of third parties in the delivery of government information and services, as described previously. As is the case with electronic commerce in the private sector, sometimes the government agency is only one part of a larger virtual value chain in which, for example, a taxpayer relies on a tax preparer to prepare and file taxes, or a veteran relies on a veterans’ service organization to file a disability claim with the Department of Veterans Affairs.41 From “E-Government” to “Government” Technology trends and the emerging areas of convergence described above all suggest that “e-government” may soon seem an old-fashioned term. The “e-government” or “electronic government”42 labels are yesterday’s news, because virtually all governmental and democratic processes are being or will be transformed by the strategic use of information and communication technologies. Perhaps the “e” preface can be thought of just as easily to signify “effective” or “efficient” government moving beyond “electronic.” The committee noted that the concepts of “e-business” and “e-commerce” are no longer routinely used; in fact, these concepts are more routinely known as “business” and “commerce.” So, too, it would seem that over the course of the next several years “e-government” could revert to “government,” albeit “transformed” government or perhaps even “networked” government. One could speculate that many government agencies, including the SSA, have let the concept of “e-government” continue to deter them from undergoing a true transformation. Once an agency has done the (comparatively) easy part, that is, making information available through Internet and Web technologies, the agency in essence has provided citizens with access to the agency’s information and services by way of the 41 S.H. Holden and P.D. Fletcher, “The Virtual Value Chain and E-Government Partnership: Non-Monetary Agreements in the IRS E-File Program,” pp. 375-394 in Handbook of Public Information Systems, G.D. Garson, Ed., New York: Marcel Dekker, 2005; and K. Frey and S.H. Holden, “Distribution Channel Management in E-Government: Addressing Federal Information Policy Issues,” Government Information Quarterly 22(4):685-701, 2006. 42 “E-government” or “electronic government” has many working definitions. For example, Sharon Dawes, director of the Center for Technology in Government at Albany, defines e-government as “the use of information technology to support government operations, engage citizens, and provide government services.” And the European Union defines e-government as “the use of information and communication technology in public administrations combined with organizational change and new skills in order to improve public services and democratic processes and strengthen support to public policies.”

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Social Security Administration Electronic Service Provision: A Strategic Assessment “front office.” The challenging part is for agencies to strategically transform “back-office” operations by using information and communication technologies to undertake the more complex processes of reengineering the core business processes, associated policies, and ultimately the services themselves; channel integration and management that successfully merges the various ways that citizens will want to access services will be essential. Much work over the past few years has explored the implications of this needed strategic transformation. One public administration expert states: Many assume e-government is solely about delivering government services over the Internet. This popular assumption is very limited for two reasons. First, it narrows our vision for e-government because it does not allow for the wide range of governmental activities that are not direct services; nor does it recognize the essential use of technologies other than the Internet. Second, it grossly oversimplifies the nature of e-government, leaving the impression that a nicely designed, user-oriented web site is the whole story. This ignores the substantial investments that are needed in people, tools, policies, and processes. It fails to recognize that while the citizen sees e-government from the public side of a web site or email screen, the real work of e-government is on the other side, inside the government itself.43 The committee has observed throughout this report that the SSA’s e-government strategy focuses primarily on the “front-office” services and seems to be missing or too slowly tackling “back-office” transformation. A Forrester research report published in 2005 finds that, looking toward the future, there are significant opportunities in e-government as agencies address obstacles such as persistent agency silos and the eroding career IT workforce within government. The report concludes that “over time, agencies will obtain sustainable results from e-government initiatives by adopting best practices like addressing process change before implementing technologies and providing integrated services through multi-agency portals.”44 Similarly, this committee concludes that the SSA’s e-government strategy could be improved by reengineering processes and 43 Sharon Dawes is director of the Center for Technology in Government at Albany (see http://www.ctg.albany.edu). Her article, “The Future of E-Government,” is based on testimony presented to the New York City Council Select Committee on Information Technology in Government’s hearing, “An Examination of New York City’s E-Government Initiatives,” June 24, 2002, available at http://www.ctg.albany.edu/publications/reports/future_of_egov, accessed July 11, 2007. 44 See Alan E. Webber, with Bradford J. Holmes, Gene Leganza, and Sara E, McAulay, “The Future of E-Government: Introducing the e-Government Maturity Continuum,” available at http://www.forrester.com/go?docid=36950, accessed July 11, 2007.

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Social Security Administration Electronic Service Provision: A Strategic Assessment close collaboration with other government agencies and third-party organizations when serving the public.45 One examination of challenges for e-government found that e-government agendas are merging with wider agendas about the role and scope of government. In the 1990s, three broad trends dominated much discussion of government: globalization, marketization, and technology. Their linked effects promised smaller government and increased customer choice. However in the 2000s these trends have blurred. As e-government initiatives move beyond tightly focused transactions, they confront issues of integration, information sharing, ethics, access, equity, and governance.46 Thus, it is increasingly clear that government transformation cannot happen in isolation, because true transformation requires working beyond the agency’s walls, literally and figuratively. As Stephen Goldsmith, former mayor of Indianapolis, describes his vision of networked government, “It is not about outsourcing vs. bureaucracy it is about managing diverse webs of relationships to deliver value.”47 So too, have the Australians started thinking in terms of “networked governance”: “While the public may traditionally have thought of government as synonymous with bureaucracy, in the future government will be highly networked and delivering outcomes through federations of organizations and agencies.”48 45 The OMB’s Federal Enterprise Architecture envisions these transformations, as detailed in a 2004 OMB report on the Federal Enterprise Architecture (FEA) Program. (See Office of Management and Budget, Expanding E-Government: Partnering for a Results Oriented Government, December 2004; available at http://www.whitehouse.gov/omb/budintegration/expanding_egov12-2004.pdf, accessed July 11, 2007.) The FEA program builds a comprehensive business-driven blueprint of the entire federal government. The development of this framework has and will continue to encourage the federal government to identify opportunities to take advantage of technology to reduce redundancy; facilitate horizontal (cross-federal) and vertical (federal, state, and local) information sharing; establish a direct relationship between IT and mission/program performance to support citizen-centered, customer-focused government; and maximize IT investments to better achieve mission outcomes. The FEA framework and its five supporting reference models (Performance, Business, Service, Technical, and Data) are now used by departments and agencies in developing their budgets and setting strategic goals. 46 Robert Smith, “Centralization and Flexibility in Delivering E-Services: Tensions and Complements,” Discussion Paper No. 19, available at http://www.agimo.gov.au/publications/2004/05/egovt_challenges/issues, accessed July 11, 2007. 47 William D. Eggers and Stephen Goldsmith, “Networked Government,” pp. 28-33 in Government Executive, June 2003, available at http://www.manhattan-institute.org/pdf/gov_exec_6-03.pdf, accessed July 11, 2007. 48 John Halligan and Trevor Moore, “Future Challenges for E-Government,” Monograph, available at http://www.agimo.gov.au/publications/2004/05/egovt_challenges/overview, accessed July 11, 2007.

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Social Security Administration Electronic Service Provision: A Strategic Assessment CONCLUSION The SSA faces formidable challenges in attempting to continue to provide its services predominantly through face-to-face personal interactions. In the years and decades ahead, its chief challenges will be the need to be prompt and reliable, to guarantee security and privacy in its transactions, to support the accurate execution of extremely large numbers of transactions, and to offer its services in ways that are convenient to the client, yet efficient. IT and electronic services are the more likely vehicles for meeting these challenges and for executing an effective campaign to provide an expanding portfolio of services to larger and increasingly diverse users. The SSA and its clients cannot afford to allow cultural impediments to keep the agency from embracing the changes that are so clearly needed and indicated. Mechanisms such as monitoring and observing the societal context, keeping track of technology, establishing quantitative goals, putting in place effective measurement vehicles, and maintaining close, cordial, and continuous ties with all user communities support continuous change and process transformation within organizations. Although pursuing the creation of these mechanisms seems essential, a more urgent need is an appraisal of the SSA’s readiness to pursue them. This report suggests an immediate examination of the agency’s management structure, its decision-making processes, and its organizational culture, to ensure that all are poised to support the shift toward a culture that continuously strives to meet effectively the manifold pressures for change. Although the challenges outlined in this report are numerous and sizable, the committee is confident that they are not insurmountable for the SSA. The committee’s investigations made it clear that the SSA and its people are firmly dedicated to meeting beneficiaries’ needs with enthusiasm and professionalism. Their dedication to their mission seems absolute and unwavering. This report is offered in the spirit of advice to dedicated professionals regarding opportunities to do ever better in meeting continually growing challenges.