State's First-Ever CIO Drives Technology — and Transformation

After steering massive transformation at the Peace Corps, Minnesota CIO Gopal Khanna brings his expertise to the state's Drive to Excellence initiative.

WITH ONLY $8 IN HIS POCKET, Gopal Khanna emigrated from India to America and steered a course that led him all the way to a position in the administration of President George W. Bush. Now, armed with $83 million, he’s working to drive Minnesota to excellence.

Tim Pawlenty, Minnesota’s governor, plucked Khanna from his Bush administration job to serve as the state’s first-ever CIO. The cabinet-level appointment is at the core of Pawlenty’s Drive to Excellence, a year-old statewide initiative to provide better, more cost-effective services to citizens by building enterprise platforms in six key areas: IT governance, licensing, building code regulation, state property management, purchasing and grant management.

“I count every day that I’m on the job because I feel an enormous sense of urgency to move with lightning speed,” Khanna says. “Minnesota needs to catch up. There’s a lot that is working already. The question is, are we ready for the 21st century?”

Many of the 66 state agencies involved in the Drive to Excellence have their own IT departments. Prior to this initiative, the mainframe and telecommunications infrastructures were managed centrally, and an Office of Technology was available to work on IT projects with the agencies, primarily in a support role.

“State agencies were fearful of centralization, so the office was given limited authority,” recalls state Sen. Sheila Kiscaden, who sponsored the legislation to create the Office of Enterprise Technology. “Over time, that limited authority made it ineffective.”

The state was spending an estimated $600 million a year on complex agency-specific IT systems that weren’t compatible with each other, and there was no central authority to ensure the integrity and security of the state’s systems, Kiscaden explains. There were 1,000 separately managed networks and more than 500 state Web sites.

“We had pockets of IT expertise all over the state, and that will continue, but we had no consistent policies,” Kiscaden explains. “If you have each state agency making its own decisions, you have a lot of redundancy. We decided to take a more enterprise approach.”

Enter the Drive to Excellence Transformation Roadmap, a plan to move the state to that enterprise structure, complete with details on costs, funding options and project deadlines stretched out between now and 2011. It’s the result of five months of surveys, interviews and brainstorming by Deloitte Consulting LLP and more than 200 employees from agencies across the state.

To execute the plans in the Transformation Roadmap, Khanna has been given a budget of $83 million to build an Office of Enterprise Technology that will make sense of — and deliver accountability to — the state’s technology infrastructure.

“The most competitive and successful businesses have gone through exhaustive efforts to replace the decentralized, redundant support structure with a more effective enterprisewide one,” Pawlenty said in an issued statement. “It won’t be easy to do, but it is critical as we deal with future budget pressures and strive to continuously improve state services.”

Early on, there were a number of skeptics who predicted the Drive to Excellence would collapse under its own weight, admits Minnesota Revenue Commissioner Dan Salomone. “But this is different,” he says. “We’ve turned the corner on this project. There are scores of people volunteering their time to make sure it gets done well.”

From Vision to Execution

Khanna is no stranger to organizational change. As both CIO and CFO of the Peace Corps, he led what he describes as a “Herculean effort” to build an enterprise accounting system. As a result of that effort, the agency can deliver unified annual auditable financial statements from its 72 worldwide posts, despite the multiple currencies and time zones in which it operates.

“Gopal is the perfect guy to come in at this postconsultant stage and make things happen,” says Salomone. “He doesn’t recognize institutional barriers. He doesn’t have a lot of tolerance for getting bogged down in bureaucratic debates. Gopal is the right man in the right place at the right time to do this job.”

Khanna talks about a three-tiered IT architecture for the state of Minnesota. The first tier, what he calls the utility level, will consist of basic IT operations — Internet connections and core applications — that can be performed by a central team. Centralizing basic functions can leverage the state’s buying power and enable each agency to focus on its own mission, Khanna explains.

At the second tier, the shared services level, agencies will collaborate to build technologies for common management functions, such as hiring and procurement. To achieve that goal, Khanna has assembled work teams consisting of his staff and 168 employees from 26 agencies to identify agency best practices and reformulate them so they can be shared across the state.

The third tier is reserved for agency-specific technologies that are unique to their mission.

Khanna has spent his first few months on the job building those processes, getting commissioners and agency CIOs on board with his vision, and defining key projects to launch in the first few months. Those projects, he says, will set the tone for the next year.

Minnesota’s Drive to Excellence Transformation Roadmap provides a tremendous framework because it already spells out what needs to be done, says Khanna. For instance, it covers consolidating data centers and making greater use of electronic forms and documents. The key now, he points out, is to analyze the business case of each of the opportunities to make sure the state’s investments are wise ones.

“Funding is a black art,” says Jim May, a Minnesota-based business development manager with a global consulting firm. “To be able to fund IT in government, you need a bigger wand than Harry Potter’s.”

A major challenge will be to negotiate low costs for state infrastructure and to find other creative solutions to bring Khanna’s mandates in on a limited budget. Another challenge, May says, will be to leverage the agency CIOs.

“You’ve got a solid management bench there, and if you know what their strengths are and you leverage those strengths at the central level, you can do more with less,” he says.

There’s a lot that’s already working in Minnesota, Khanna points out. Employees are knowledgeable and dedicated. The mainframe and telecommunications infrastructure is strong. However, he adds that the state needs more responsive and skill-based technology services.

“What people forget is that we’re driving this car at 65 miles per hour,” Khanna says. “We know that the tires and the engine have to be changed, but we don’t have the luxury of stopping and buying a new car. We just have to keep driving toward transformation.”

In His Own Words

StateTech Editor in Chief Lee Copeland recently spoke with Minnesota CIO Gopal Khanna to discuss his new position. Following are some insights from their conversation.

Lee Copeland: People are naturally resistant to change. Is your job harder because you’re coming into an organization with a reform mantra?
Gopal Khanna: No, not at all. Actually, I came into a position of enormous advantage. [From September 2004 to January 2005,] the state of Minnesota conducted a study to identify opportunities to transform government and improve services for citizens. The legislature responded to that study by creating legislation and creating this position. When I came in as CIO, that work had already been done.

Having served in the federal government during the past few years, I walked away very impressed with the desire of public sector employees to change. They really are public servants, and they want to serve citizens better.

Copeland: But doesn’t the lack of urgency make it harder to motivate employees?
Khanna: People in the public sector respond to executive orders. When the [President’s Management Agenda] was set, people responded because they treat the law very seriously and with enormous respect. I’m seeing the same thing in Minnesota. Now that the legislation has been put forth, people view this as business; we have to do it.

Copeland: You’ve been given a budget of $83 million. Considering the size of your staff and your mandate, is that sufficient?
Khanna: When I came on board, I did not ask the governor how much money I would have. I asked Tim Pawlenty what his vision was. The governor, being the magnificent CEO he is, said, “Gopal, I would like to put programs and processes in place that will, on an ongoing and continuous basis, provide improved services for the citizens of Minnesota.”

My job is to take that vision and convert it into an operational program. The legislature is like my venture capitalist. If I have a good, coherent business plan, which emphasizes the opportunities and shows how the value proposition can be realized, and I have a good management team — which I am assembling right now — I’m sure funding will happen. I’m not worried about that part of it.

Copeland: At the Peace Corps, you served as both CIO and CFO. How do you feel about organizations in which IT is a function of the financial officer’s team?
Khanna: I am totally opposed to the notion that a CIO should report to the CFO. I think they are two distinct functions.

When I was at the Peace Corps serving as CIO, I was asked to be the CFO as well. I accepted the offer, but only until we could find a CIO. You need the wisdom of two different perspectives. The CIO is a big spender, and the CFO has the money.

I benefited immensely in my CFO role because I was able to bring the IT project discipline under the CFO side.

More CFOs today need to be technology-savvy because their business advice to the head of the agency needs to have both a technological and a fiscal bent. Likewise, a good CIO today needs to have a good fiscal sense.

Melissa Solomon is a veteran technology journalist based in Austin, Texas.

Oct 31 2006