type of transition is needed for that ecosystem, in the committee’s view the culture and organization of CMS have to be transformed—not merely modernized—in order to meet its current and future challenges.

CMS faces special challenges in this regard, given that its agenda and priorities are often defined by external forces such as new legislation or other congressional directives, as described in Chapter 1 and 2. But much of how CMS does what it does is determined internally, based on organizational structures, planning and decision-making conventions, the availability of resources, and relationships (defined by informal culture as well as formal reporting relationships). Considering the centrality of IT as an element in, and enhancement to, a transformation in CMS’s organization and culture, the committee in this chapter summarizes CMS’s current organization and relationships and describes what an IT-enhanced enterprise within CMS might look like, offers suggestions for aligning overall strategic goals and resources to achieve the needed organizational transformation, discusses the importance of leadership and innovation, and outlines some guiding principles along with a roadmap for cultural and organizational transformation at CMS.

In summary, the committee believes that in order to meet emerging and future needs, CMS should undergo an organizational and cultural transformation, actively integrating IT as a strategic partner in its business and deepening in several areas its critical internal IT core competency.

BASIC ELEMENTS OF THE CULTURAL AND ORGANIZATIONAL TRANSFORMATION NEEDED AT CMS

In any organizational transformation, several key elements contribute to a successful transition: a clear and well-articulated mission; an effective organizational structure; firm commitment on the part of leadership to lead change; effective communication across the board; buy-in and support from key players, engaged staff, and employees; and perseverance.1 A frequently cited example of successful organizational transformation in the federal government is the IT transformation of the Internal Revenue Service. Achieving large-scale change in a complex government service operation,2 that effort has been applauded for demonstrating the key roles of leadership, vision, and cultural change. Similarly, a generation of physicians and other health professionals has seen the transformation in

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1 Mark A. Abramson and Paul R. Lawrence, 2002, Transforming Organizations: IBM Endowment Series for Business of Government, Lanham, Md.: Rowman & Littlefield Publishers.

2 Amy C. Edmondson, Frances X. Frei, and Corey B. Hajim, 2002, “Transformation at the IRS,” Harvard Business School Case 603-010, available at http://cb.hbsp.harvard.edu/cb/product/603010-PDF-ENG, last accessed July 20, 2011.



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