Aussie Whirlwind Sweeps Through Government IT

By Lauraine Sayers  |  Posted 05-05-2005

Aussie Whirlwind Sweeps Through Government IT

A piece of butcher's paper peppered with hand-scribbled adjectives hangs on the wall of Jane Treadwell's office in downtown Canberra, Australia. It is a memento from a recent leadership workshop, during which Treadwell's colleagues at Centrelink, Australia's massive social welfare agency, were asked to describe their CIO: "flashy," "imaginative," "process driven." In looking over the words chosen by Treadwell's colleagues, it's difficult to imagine that they all describe the same woman: "colorful," "hyperactive," "tough and principled."

How could so many people see such different things in one person? Perhaps it's that over the course of the last seven years, during which time Treadwell has been remaking Australia's biggest government agency, she has had to be all of those things and more. As CIO and Deputy CEO of Business Transformation at Centrelink, Treadwell has presided over a $312 million e-business modernization of the agency's delivery of social services across the entire continent, called Project Refresh. She's even been able to successfully shed the label of "femocrat" (a derogatory Australian term for a feminist bureaucrat).

Even though Treadwell is a high-ranking government official, she is all business. Since her arrival at Centrelink in 1998, customer satisfaction has grown from 63 percent to 86 percent. And a 2002 Boston Consulting Group review reported a 21 percent increase in productivity over the agency's first five years.

Centrelink now delivers $55 billion (Australian) in payments for 25 government agencies and has more than 1,000 offices throughout Australia. Its staff of more than 25,000 serves 6.5 million customers—including retired people, families, single parents, the unemployed, people with a short-term incapacity or long-term disabilities, students, children, members of Australia's indigenous population and people from diverse cultural and linguistic backgrounds. Centrelink has the second largest call-center network in Australia, and it can be used, as required, by any government agency.

Today, Treadwell is held up as something of an IT hero in Australia. Her face has graced the cover of all the major industry magazines, and her opinions on sticky IT issues are sought by government and business executives alike. But it took many years to earn that sometimes grudging respect, and, even after proving herself time and again, she still recognizes the enduring key to her success in driving transformative projects: "If you can't demonstrate value, you'll only argue about cost."

ZIFFPAGE TITLEBig, Bad Bureaucracy

Big, Bad Bureaucracy

Centrelink was launched in 1997 as a unique experiment by Australia's newly elected conservative political party. Its aim? To provide a one-stop shop for the 6.5 million Australian citizens—almost one-third of the country's 20 million people—who receive some kind of social welfare benefit.

Before Centrelink, a number of government organizations in Australia were responsible for distributing benefits, but two dominated the social welfare landscape: the Department of Social Services (DSS) and the Department of Employment, Education, Training and Youth Affairs (DEETYA).

DSS employed more than 20,000 people, most of them in some 300 regional offices scattered across the country. DEETYA employed about 12,000 people and had a network of over 290 field offices; its chief task was to help the unemployed find work.

Typically, about 65 employees worked in a regional office, where, on any given day, they would handle a variety of benefits claims and requests from hundreds of people. The multilayered benefits-application process itself made the Department of Motor Vehicles look like a model of efficiency. Customers would fill out a form and then sit down with a DSS employee, who would check it for completeness and accuracy. But it was more of an interrogation than a meeting. The final decision on whether an applicant was eligible for a benefit— and if so, for how much—was not made at the time of application. First, an "assessing officer" would review the application to determine eligibility; next, a "determining officer" would review and approve, or disapprove, the assessing officer's decision. New applicants usually had to come in more than once, because they rarely had all the information they needed on their first visit. In complex cases the process could take months.

It was a mess, and widely recognized as such, but any attempt to rationalize the process was generally thwarted by the long tradition of rivalry between DSS and DEETYA.

Yet in the early days of Australian Prime Minister John Howard's new administration, in 1996, it took three highly motivated senior executives just 15 minutes to reach an agreement to combine the agencies and move toward an e-business overhaul of the entire benefits process.

This new breed of public entity was to be called Centrelink. Initially, it was to be responsible for delivering only DSS and DEETYA benefits; in time, however, it would come to process payments for 20 federal and state government departments.

It sounded simple, but in practice, it was dauntingly complex: Thousands of employees from the two departments had to merge abruptly; offices known for long queues, unfriendly atmospheres, limited hours and labor militancy were suddenly expected to become "customer-friendly." And all this within a deadline of just five years.


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Jane's Brain

Treadwell was hired by Centrelink CEO, Sue Vardon. The pair had previously worked at the Department of Correctional Services, South Australia, and Vardon is blunt in saying that she wasn't looking for a technical expert. "I had plenty of them—IT people with distinction who could make the mainframe dance. I was looking for a good strategic thinker."

Treadwell joined the public sector ranks early in her career and never looked back. She did stints with various Australian healthcare agencies. And at the Department of Correctional Services, Treadwell worked with Vardon to squeeze 30 percent of the costs from the overcrowded Australian prison system.

"The thing I like about Jane is her brain," Vardon says. "She's intelligent and she thinks futuristically. She projects every concept about the present into the future, which allows her to make the right choices about present solutions."

At Centrelink, Treadwell got a handle on things by reading change-management books by authors such as Tom Peters and Marianne Broadbent, and by traveling extensively to other government sites and forums throughout Europe, the U.S., the U.K., Australia, New Zealand and Ireland.

But her educational honeymoon didn't last long. There was pressure to deliver from the very beginning. To start with, she encountered an underlying resentment against IT—it was perceived to be running the business—and a commonly held cynicism about the amount of money that went into the IT "black hole." Old-timers viewed IT as something you thought about later, and they tended to see the CIO role in a technical rather than strategic light. It was in the face of this that Treadwell had to persuade the Department of Finance that funding the massive $312 million up-front costs of the new e-business infrastructure was a worthwhile investment.

Worse still, nothing in Australia's political hotbed of Canberra escapes public comment or criticism, deserved or otherwise. In fact, a quick search on the Community and Public Sector Union (CPSu) site about Centrelink still yields withering criticism of Treadwell's forceful views.

Treadwell, as always, is unfazed. She has a three-pronged strategy for handling criticism. "If it's about the organization, we try to work out whether it's constructive and if so, how to address it. If it's written up in the newspaper, then I try to work out how many people are going to read it. And if it's personal, then I keep getting up in the morning and keep getting on with the job. I'll do a few extra kicks in body combat."

"In an organization this big, you don't stretch the bounds of possibility without making mistakes," she says. "We've always felt a lot of scrutiny, but we've also had the desire to justify the experiment."

Centrelink's e-business transformation began simply in 1997 with a pilot program wherein customers used telephone and Internet channels for self-service. Prior to this, a customer was required to call, write to, or actually visit a Centrelink office , and then wait for a result. But achieving even this elementary level of customer self-service support required innovative solutions. Centrelink found that off-the-shelf middleware would not suit its purposes, nor would a modified commercial product. The result was a project to create customized middleware that is known as the Centrelink Online Framework (COLF).

Centrelink's first self-service product, called Payment Details, required translating more than 500 pieces of code from multiple data dictionary tables in the legacy system. It then needed to be turned into meaningful "conversation" accessible through telephone-based voice recognition software, and later, via Web pages. This meant understanding how staff interacted with customers so that the feel of Payment Details would be the same, regardless of the channel. Subsequent products have faced similar challenges, both in technology and in translating the existing business policy and process into e-business. The voice recognition software used to achieve this has won several international awards.

Centrelink's e-business is now fully operational and expanding regularly. It allows clients to find information easily and update their details as their situations change. Centrelink receives and processes client information much more quickly than before, and customers, who often feel a stigma attached to contacting a welfare agency, maintain their anonymity.

In the majority of cases, the target take-up rate for each Centrelink service has exceeded expectations, depending on the service. For example, in the case of the Report Employment Income service, the target take-up rate exceeded expectations by between 50 to 500 percent. Treadwell says the exponential take-up rate didn't surprise her, but it overwhelmed parts of the organization that didn't anticipate it.

To achieve all of this, Treadwell injected IT, which had long been seen as a separate entity, into upper management. Through her efforts, IT disappeared as a distinct concept and became part of the business transformation domain. "We started working on project management and portfolio management. I closed down the IT project office and said there was no such thing as IT projects—they are all business projects." And that is how Treadwell became Deputy CEO of Business Transformation, as well as CIO.

She then went several steps further. To prepare the entire organization for the e-business transformation, Treadwell made use of "a radical new group" called the Guiding Coalition, made up of all of Centrelink's 60 executives, including area managers, team leaders, and customer segment team leaders. Every six to eight weeks, Treadwell and her team presented to the Guiding Coalition on potential service opportunities created by IT. Until recently, the group continued to meet regularly, for a day and a half to two days, every six weeks.

Although it's difficult to understand how the dynamics of a team of 60 people might operate, Treadwell is adamant that it works very effectively. She says the meetings, chaired by the CEO and four deputy CEOs, are structured, but involving and engaging.

Another unusual governance structure Treadwell established involves a talent bank. Staff in her business transformation domain no longer own positions. Instead, they are assigned to roles and capabilities. The objective is to prevent people from being stuck in the same position forever. They are assigned to a service role or a project, and at the end of that project, they become available for reassignment.


Level 5 Leader

Treadwell proved herself to the team through hard work, humility and a yearning for simplicity. Both Vardon and Treadwell worked 70 to 80 hours a week throughout the five-year e-business transition. During this time, Treadwell earned the reputation of a highly motivated, tough negotiator who holds people accountable, and a brilliant strategist who is good at identifying the right people. "Anyone who achieves anything at her level in the public sector must have a special set of qualities," says Marianne Broadbent, a senior vice president at Gartner Inc. "In Treadwell's case, those qualities encompass being inclusive, listening, showing respect but being willing to make decisions, and really lead. She knows what she doesn't know and doesn't hesitate to ask. And that plays to the advantage of a CIO who might not have a strong technical background. Treadwell challenged people to clarify things and make them simple, reducing the mystique and complexity about how they spoke about IT-enabled initiatives."

According to Broadbent, both Treadwell and Vardon are what author Jim Collins refers to as "Level 5" leaders, people who combine humility with absolute determination and perseverance.

Treadwell confesses that her technical naïveté made the e-business job appear more approachable at first. In hindsight, had she known the level of complexity involved, she might have been more worried.

Vardon agrees. "Neither of us knew at the start how big this was going to be, which was probably just as well. But we always had a very clear view of our objective. Back then, e-business was just a thought. We didn't know quite what it involved and neither did the rest of the world. We had a motto: 'Fake it till you make it.' Our people had to learn on the job, and today, a number of Centrelink staff are considered experts in government e-business."

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Post script: Treadwell recently accepted a new position as CIO of the Victorian government, which she starts on May 3. "Now that we've made a success at Centrelink, I want to work across organizations to create something special for customers and government," she says. "And yes, that butcher's paper is coming with me."

Lauraine Sayers is a freelance IT writer and editor. She is based in North Geelong, Victoria, Australia.