Managing Exodus

Wil Berrios expects to lose 75% of his experienced information-technology workers during the next three years. And another 10% in the two years after that.

But he's okay with that.

For Berrios, chief information officer for the U.S. Army Corps of Engineers, the coming wave of retirements is something of a blessing in disguise. Those specific figures reflect only the relatively small information-technology staff at the Corps' headquarters, but Berrios expects the same proportion will apply across the Corps' 1,500-person technology staff.

The exodus gives him an opportunity to manage his systems by outsourcing the bulk of the Corps' information-technology services to contractors who win the business by proving they can do the job more efficiently than internal staffers.

Berrios declined to comment on what positions are likely to be outsourced in the future, pending approval of a plan likely to be finalized later this year. That plan will come together during a long, politically charged process. He expects more arcane functions—maintenance, support of the specialized systems that control dams, waterways and irrigation projects—will remain in the hands of Corps' full-time staffers.

Not that the Corps lacks contractors now. More than half of the approximately $500 million in information-technology services—e-mail and desktop support and custom application development—the Corps provides comes from contractors. Much of the Corps' Unix and Windows system administration and network maintenance are handled by outsiders, as well.

The unit is hardly alone. Nearly 50% of all government workers will be eligible for retirement over the next five to seven years, according to Stan Soloway, president of the Professional Services Council in Arlington, Va., a non-profit agency representing contractors and technology vendors who do business with the federal government.

Other government CIOs might want to watch how Berrios has handled the departures. He has steadily expanded the role of contractors in delivering technology services to the Corps, which has 135,000 military and civilian staffers in 51 sites domestically. The services help the Corps build dams, waterways, roads and other national infrastructure, as well as assist in disaster relief.

Last summer the deputy commanding general of the Corps gave Berrios permission to begin the process of planning and rolling out a comprehensive outsourcing plan. The decision was driven by several factors: a Bush administration drive to privatize many of the less-critical functions government agencies provide; pressure to shrink headcount within the Department of Defense; and the looming possibility that three-quarters of the technology staffers at the Corps would leave on their own before replacements could be trained.

"We are in part doing it to compensate for the exodus, but really to deliver services in a more cost-effective fashion," Berrios says. "When we look at our various sites, we see multiple help desks and LAN administrators and configuration managers and so forth. A lot of those functions can be consolidated."

Berrios worries about losing specialists who can design large networks, databases and systems to control dams, spillways and other specialized irrigation or waterway systems. He'll have to find a way to keep those specialists, or have them train others. But he expects the responsibilities of much of the rest of the information-technology staff to shift. He predicts his reduced staff will manage projects, oversee outsourcing contracts and do the research and testing needed to decide when to buy, build or install new systems, as well as to keep track of technology the Corps already owns.

The Corps, like most government agencies, has plenty of workers in either the spring or the winter of their careers, but way too few summers. Mid-career workers are more rare in government than in business because people tend to sign on young at government agencies, then leave for more lucrative jobs, Soloway says. A very small number of workers in middle management or below come onboard in their 30s or 40s—leaving few to fill the big hole opening up with the wave of retirees.

Neither the demographic gap nor the wave of retirements is a surprise, however, so the Corps could have started advance planning to put the right mix of skills in place without having to scramble, according to Ray Bjorklund, senior vice president of consulting and chief knowledge officer of Federal Sources, Inc., a company that analyzes government spending on technology.

But even with a big push for privatization from President Bush, Berrios is still required to follow strict procedures when farming out work. Under the Federal Activities Inventory Reform act, which dictates that up to 850,000 federal jobs can be privatized, every agency has to inventory positions to determine which ones can go to contractors and which ones are "inherently governmental." The latter would be jobs—captaining a ship, for example, maintaining a waterway or leading troops—in which workers exercise "substantial discretion" in how to apply government powers.

The Corps has completed an inventory of all its current 1,500 technology positions and submitted it for approval to the Army, which must submit it to the Department of Defense, which in turn must submit it to the Office of Management and Budget, according to Ray Navidi, director of use-based competitive sourcing for the Corps. Neither Navidi nor Berrios would discuss details of the inventory until the DoD and OMB approve it. Such inventories have been highly controversial in other agencies, however, as unions and other worker organizations press to retain as many on-staff positions as possible.

Probably later this year the Corps will file a formal notice to Congress indicating it plans to put some of its positions out to bid. If the Corps' plan to "compete" its positions is approved, Berrios will have to oversee a formal contest in which staffers and technology companies draw up proposals and compete for the title of Most Efficient Organization, to which goes the contract. Government staffers win about half of the competitions.

The crux of the Corps' problem, however, is not the efficiency of the plans, but the structure of the contracts and the skills of the people who would oversee them, says Bjorklund. Contracts tend to emphasize tasks rather than overall performance. They rarely include personal-service clauses that would allow the manager to be a day-to-day supervisor and to hire or fire based on performance.

"Most government I.T. contracts specify things like, ¬'The help desk will be staffed from 8:30 to 5:30,' but they don't go beyond just putting someone in that chair," Bjorklund says. "They need to move more toward goal-based or performance-based criteria, and teach what are some pretty smart people in government I.T. how best to manage a federal I.T. contract."

Much of that knowledge will be supplied by Corps retirees who return to their old jobs as contractors, often with better pay, Soloway says. But there are no guarantees.

Berrios says the Corps is expanding project-management training and will continue to do so, but he hopes technology will help ease the crunch. The Corps has standardized on Microsoft Windows servers for its office environments and Sun Unix servers with Oracle databases for its critical functions. All its development is contracted. The Corps will also expand its use of Microsoft's Systems Management Server to automate maintenance of Windows servers and Computer Associates' Unicenter and other management tools to centralize control of the rest of the network.

And Berrios says he's hiring interns and young computer scientists who are formally trained in skills the more experienced crew had to pick up on the fly.

"The way we're going to deal with this exodus is going to be highly dependent on what the eventual mix will be," says Berrios, who won't even say when he'll submit the notification to Congress, let alone what it will say. "But if we leverage the technology correctly and continue our recruitment efforts and train our young folks, we'll be able to fill the void." What Should You Do to Manage An Exodus Be prepared. Forecast spikes in retirements, layoffs or closures. Determine what skills or geographic areas will be hit hardest. Sweeten the pot. Use raises, bonuses, promotions. Keep people with the skills you really need. Find replacements. Line up contractors with similar skills. Keep service levels at or above present levels. Develop a bench. Don't focus on new recruits. Find folks in mid-career who want to tackle new challenges.

Copyright © 2004 Ziff Davis Media Inc. All Rights Reserved. Originally appearing in Baseline.