Amid the plush surroundings of London’s Portland Place meeting rooms, a Whitehall powerbroker steeped in the workings of local and central government is about to launch arguably his most daring crusade. A long shot it might be, but he knows that a successful campaign will transform the way that IT is planned, purchased, executed and managed across the whole of the UK’s public sector.
The man in question – Andrew Pinder, the government’s e-Envoy – outlined his plan at a conference earlier in the autumn attended by some of the UK’s top IT figures. With his own contract due to expire in 2004, as well as that of another key civil servant, Peter Gershon, the chief executive of the Office of Government Commerce – the unit that sets policy on public sector procurement – Pinder told the audience the time had come to establish the UK’s first ever government-wide CIO. He suggested the role would be wide-ranging, combining the responsibilities of both his and Gershon’s job.
Onlookers said the choice of event was significant: it seemed he was seeking to stimulate interest among possible candidates, though he was not prejudging the selection criteria. “There is no indication … as to whether the person will come from the private sector, as Gershon did, or be a senior civil servant. It is wide open, the best person will get the job,” he said.
Once, the idea of a career move from the private to the public sector would have been enough to fill most IT managers with dread. Why give up the big pay cheque, the share options,
the performance-related bonuses, the mortgage support, the generous pension, the private health care, the life insurance, the company car? After all, the alternative hardly seemed equitable: a smaller salary and few benefits, more bureaucracy, less control, not to mention the likelihood of inheriting an underfunded, creaking and inefficient IT infrastructure, usually supported by poorly motivated, under-trained and under-paid IT staff. With a few notable exceptions, the movement between public and private sector IT work for years was almost entirely one-way.
Not any more, says Simon Wiggins, a partner in the global technology markets unit of Korn/Ferry, the recruitment and executive search firm. “Today, [to be a major public sector CIO] is such a huge challenge that in many ways it would be the pinnacle of that person’s career,” he says.
As cash has flowed in from central government and Europe, much of it financing ‘joined-up government’ initiatives, IT budgets have expanded to the point where multi-million pound projects are common and multi-billion pound ones are no longer unusual. Only this year, the National Health Service (NHS) has been seeking suppliers for a £5 billion IT modernisation programme, while the Inland Revenue has been finalising a £4 billion outsourcing contract.
That situation is very different from many private sector organisations, where budgets are tight and projects often cautious in scale.
At the same time, the extra funds have helped to narrow the gap between salaries in the public and private sector. A “significant” gap still exists, says Wiggins, particularly in London and the south east of England. At this point, the bigger salaries being paid for senior public sector IT managers have not yet filtered down to more junior roles. The NHS programme, for example, calls for project leaders earning just £19,000-£30,000 a year, while even programme heads are being recruited for only about £60,000-£70,000.
The picture is better for the top roles. Naturally, they cannot expect to match the salaries of the leading IT directors in the financial services sector, some of whom can earn seven-figure incomes when bonus packages and share options are added in. But the most prestigious IT figures in the public sector are paid at the higher end of the government pay scale. For example, Richard Granger, programme IT director at the NHS, is the most highly paid civil servant in the UK – with a salary of £250,000. Pinder, for his part, is understood to earn about £150,000; Gershon draws a salary of about £180,000.
What these three have in common is that they all forsook big salaries in the private sector. Granger was a partner with Deloitte Consulting, Pinder worked at Citicorp and Gershon was the chief operating officer of British Aerospace. Another public sector recruit is Jo Wright, previously of IBM, who became the Home Office’s director general of IT in 2002. Inside the Department of Work and Pensions, meanwhile, most of the top IT staff came from the private sector – for example, CIO Robert Westcott worked for General Motors, CTO Kenny Robertson was at Andersen Consulting and Richard Jones, the head of technical infrastructure, came from Norwich Union.
They represent the new breed of public sector IT executive: experienced, business-savvy and diplomatic, but also not afraid to take on suppliers and fellow civil servants when required. And, as they see it, they are now giving something back to society.
If the role does emerge, the appointed UK CIO will join an elite club. There are only a handful of people in other countries who can claim to be able to set wide-ranging policies for
public sector IT projects. One is Olavi Kongas, CIO of the Finnish finance ministry; another is Michelle d’Auray, CIO of the Canadian Government. Advocates of a pan-government IT executive say it is no coincidence that Canada is often cited as the world leader in e-government projects.
If it has taken years to create the first government CIOs, it proved just as problematic setting up departmental and local government CIOs. In the US, when John Kost was made CIO of Michigan in the early 1990s, it was the first time that a state government CIO had been appointed anywhere in the country. Kost says he earned “five figures”, but salaries have risen since then. Today, it is rare to find a senior IT post in the US public sector advertised for less than $120,000, and some jobs command $200,000 salaries. Karen Evans – the closest thing the US comes to a federal CIO – is believed to earn about $140,000 for her job as the Office of Management and Budget’s new administrator of e-government and IT.
In the UK, some significant obstacles must first be overcome before the country gets its own Michelle d’Auray. For one thing, there are doubts that the government has the political will to push through the changes that would give the role some teeth.
Yet there are clear signs that Pinder, at least, is serious, even if his political masters are still to be convinced. Information Age has learned that the e-Envoy has held a series of meetings with the advisers at IT consultancy and market watcher Gartner since the summer, including one ‘off-site’ day in October 2003 during which the possible powers of a UK CIO and his or her job description were drawn up. The inference: Pinder will look to have a new post created once he leaves his present job, perhaps during the second half of 2004.
The main barrier to establishing more public sector CIOs – at both a local and a national level – has been an inability by governments to agree on the CIO’s powers. With a government-wide CIO, this will be an even bigger task, says Andrea Di Maio, a vice president of Gartner. “Deciding on a salary and attracting the best talent is the least of the government’s problems,” he says.
Take an obvious area of responsibility for the CIO: deciding which projects can be tackled on the IT department’s limited resources and which should be postponed or shelved. The idea of prioritising public sector IT projects is nothing new, of course, but it is usually done within a particular department.
Even then, departmental CIOs may not have a say in which projects go or stay. Although they manage a strictly fixed budget, the project portfolio is regularly added to as a result of decisions by politicians or other governing authorities. The upshot is they are expected to run hundreds of projects simultaneously, with insufficient resources to support them all.
In any case, allowing someone like a CIO to prioritise IT projects across a variety of departments is bound to lead to power struggles between agencies, warns Di Maio. “Usually,” he says, “the biggest departments want the greatest say.”
Another problem is the fact that a CIO will almost certainly seek to standardise IT platforms across the total government infrastructure. In his speech, Pinder said government departments and local authorities tended to ‘re-invent the wheel’. “We will be seeing over the next two years or so moves
to standardisation and a greater use of packages. It makes a pile of sense to pick the best practice of somewhere. There is no added value in localisation,” he said.
But implicit in that is a proposal to migrate many organisations’ applications and platforms towards a common infrastructure. That too could create friction between centrally governed IT and individual public sector departments.
Another barrier is the difficulty in finding the right person for the job. Kost, now the managing vice-president of Gartner’s worldwide government practice, says: “You need to have an ego big enough to fill this role. There aren’t many people around that can pull it off. When I was CIO of the State of Michigan I had tremendous power and authority. I was running the procurement process, I was responsible for the portals, the telecoms service, for setting policy.”
A strong personality will need to go hand-in-hand with a determination to get things done. A lot of patience will also be needed. “Most people will very quickly get weighed down by all the bureaucracy and the politics,” says Korn/Ferry’s Wiggins.
John Handby, who has had experience of major IT roles in both the private and the public sector, including posts at GlaxoSmithKline and the Royal Mail, agrees. “One of the reasons I left the public sector was the feeling of frustration,” says Handby, now chief executive of CIO Connect, an IT director forum. “It’s difficult to get things done. There are more checks and balances, there is less flexibility in procurement, and CIOs have less control. Everybody is worried about ending up in front of the Public Accounts Committee, which constrains people’s actions. In fact, working in the private sector is far more straightforward.”
Handby also disputes the often quoted line that the public sector is the place where most of the big IT projects are happening. “I would take issue with the idea that everything has been done in the private sector. There are still a lot of big investments in ERP, CRM and other major enterprise systems, there is still much work to do to get more from existing infrastructure, and there is a lot to do to create more connected and responsive businesses,” he says.
Nonetheless, the public sector – for those seeking to wield big budgets, handle large outsourcing deals and take on the challenge of modernising a public service – might never have seemed quite so enticing.