Hawaii Business Magazine: Five Ways to Make Government More Effective

Jul 22, 2019 | Hawaii Business Magazine

By LiAnne Yu, Noelle Fujii-Oride, Carin Enovijas, Beverly Creamer

This article is referenced from Hawaii Business Magazine. Read the full story https://www.hawaiibusiness.com/change-government-civics/

Change will happen when all citizens are involved, including leaders and employees from government, businesses and nonprofits

This report is one of six reports on CHANGE because Hawai‘i must change its path.

CHANGE stands for six interconnected major issues identified by the Hawai‘i Community Foundation and explored in-depth by Hawaii Business Magazine. Those issues are:

Government leaders, civic-minded citizens and business and nonprofit executives all must help initiate the changes needed in each of these areas. This report focuses on how government and our civic community must improve to help lead those changes.

Like the previous reports, this report is not intended to cover everything about government and civics in Hawai‘i. It examines key issues in-depth and focuses on possible solutions and ways forward.

Why is this business magazine doing these reports? One reason is because businesses and business leaders must be part of the solutions. Government and nonprofits have not been able to solve these problems, so businesses must help.

These reports are part of a multifaced approach to change that was launched at the annual Hawai‘i Executive Conference in October 2018. The conference was led by Hawaii Business Magazine’s owner, Duane Kurisu, and the committees formed there are bringing together business leaders, nonprofit executives and politicians to focus on the major challenges facing our Islands. This is not a one-year effort but a long-term commitment to change from many people.

The six reports published in Hawaii Business Magazine and at hawaiibusiness.com are part of that multifaceted approach. We welcome your feedback on any of the reports: Use the tag #HawaiiforChange on Facebook, Twitter, LinkedIn and Instagram.

Disclosure: Hawaii Business Magazine got support from the aio Foundation, HCF and other organizations, and input from many people, but no one outside our editorial team had any control over the content of these reports. —Steve Petranik

Part 1: Five Ways to Make Government More Effective

How to apply lessons learned by businesses without compromising the public good

By LiAnne Yu

People are frustrated with government in Hawai‘i.

There are many reasons, from the near daily revelations of graft, corruption and bribery among public officials, to rail’s ever-ballooning costs.

“I strike up conversations with people all the time about what they think of state government. Usually their first reaction is they think of it as corrupt. And unresponsive. That it’s serving some groups and they’re not exactly sure who those groups are,” says Colin Moore, associate professor at UH Mānoa’s Department of Political Science.

“Any sense that it is directly responding to their own concerns just isn’t there. People will just shrug their shoulders and assume certain interests, like development, will always get what they want and there really won’t be much action on anything else,” says Moore, who is also the director of the UH Public Policy Center.

These perceptions are not just anecdotal. The Center for Public Integrity graded Hawai‘i a D+ in 2015, with especially low rankings compared to other U.S. states in areas including legislative accountability, electoral oversight, judicial accountability and lobbying disclosure. In 2018, the U.S. Public Interest Research Group Education Fund gave the Aloha State an F for transparency, ranking it 44th in the nation for online access to government financial data. That same year, a study conducted by the UH Public Policy Center found that 55% of those polled only sometimes trusted state government to do what was in the public’s best interests, while 14% of them never trusted government.

In response to these problems, multiple organizations and community groups are dedicated to making Hawai‘i’s government more transparent and accountable. Common Cause and the League of Women Voters take on many issues, including challenging the constitutionality of gut and replace tactics in the state Legislature. The Civil Beat Law Center investigates denied access to public records, including one involving the Honolulu Police Commission.

Many people across both the public and private sectors have also argued that government would function better if it were run more like a business.

“In government work, the guarantees of employment, the guarantees of contracting and the guarantees of funding mean that the players are not required to perform at their very best in order to compete for the resources that are needed,” says Keli‘i Akina, president and CEO of the Grassroot Institute of Hawai‘i.

“Sometimes when there’s guaranteed employment, people begin to work for their pension, rather than work for productivity or performance. Whereas on the other hand, in the private sector, you have do-or-die competition, a survival of the fittest so that the best rise to the top. Generally speaking, the private sector can accomplish projects and complete work at 20%-40% less expense than the public sector.

“Competition in the marketplace and in the workplace creates excellence,” Akina adds.

He cites an experiment in Sandy Springs, Georgia, a suburban municipality near Atlanta with a population of about 107,000. It has privatized most government services, working with private sector contractors instead of government institutions and employees to carry out public projects. “The efficiencies have been astounding and there are now at least 13 municipalities looking at that model, and considering converting to a high level of private sector work to carry out public projects,” says Akina.

Others, however, caution against the wholesale application of a business model to government.

Josh Frost, legislation committee co-chair of the state central committee of the Democratic Party, says: “There are people who make the argument along the lines of efficiency and getting it done faster and cheaper. But what it comes down to is whether you want things to be fast or whether you want them to be a little slower in order to make sure there’s fairness, that taxpayer dollars are used wisely, and that people aren’t greasing the wheels and getting unethically rich. We’ve got to find a happy medium.”

Public-private partnerships represent one possible path toward that middle ground. The successful creation of Kahauiki Village, the Honolulu community for homeless families, and the transfer of Maui’s state-owned hospitals to management under Kaiser serve as models for how communities can benefit from such collaborations.

In this piece, Hawai‘i’s leaders across public, private and nonprofit sectors discuss how business-inspired practices around creativity, innovation and agility are making their way into government, enhancing responsiveness, transparency and accountability without compromising the commitment to public good.

Edward Mersereau, deputy director of the Behavioral Health Administration at the state Department of Health, says, “We can find a better balance between upholding the valuable pieces of bureaucracy that allow us to operate in the public trust, and stay within the public trust, and not break that, while also not losing our imagination, and not losing our motivation to find new and innovative ways to get things done.”

Hawai‘i’s leaders share five key principles, inspired by best practices in business, for making government more effective.


1. Have a proactive technology strategy, not just a reactive upgrade approach

Christine Mai‘i Sakuda asks us to imagine what kind of technology infrastructure the biggest and most important businesses of our state should have.

We would probably not imagine a payroll system that, up until just a few months ago, was 40 years old, running on hardware so outdated there was no longer any vendor support. We would not imagine the 80,000 paper pay statements that had to be distributed every two weeks. And we would not imagine that within this organization, each department had its own IT system and that none could talk to each other.

Although we would not imagine that for our most important companies, that has been the reality of our state government’s IT infrastructure.

“If the state government were a business, like First Hawaiian Bank, Bank of Hawaii or the Queen’s hospital, it would require itself to function as best as possible. It would require of itself a core infrastructure that was updated, modern and secure. It would require of itself a plan to integrate data across departments and be available to the public,” says Sakuda, executive director of the nonprofit Transform Hawai‘i Government.

“In other words, it would have a strategy, a North Star guiding light.”

The mission of THG, says Sakuda, is to support the improvement of government business practices through technology, and on behalf of the public, to keep an eye on how that is proceeding. With its support in 2012, the state’s first chief information officer created a baseline assessment of the entire IT situation in state government, including the hundreds of separate systems that didn’t talk to each other.

“We had a complete, comprehensive plan for bringing the state of Hawai‘i into the 21st century across the entire spectrum of computer and cyber modernization and a timeline for the complete modernization of every aspect of state government,” says former Gov. Neil Abercrombie.

While the original baseline assessment has not yet been updated, a bill recently passed that requires the state CIO to update the IT plan every four years, with the first update in 2021.

Progress to date since the first assessment includes the modernization of the 40-year-old payroll system, which is now fully electronic, and the Tax System Modernization Program, slated for completion next year. Recently appointed state CIO Doug Murdock says the next priorities include updating the business functions of the state’s IT system, which include finance, accounting, HR, contracting and procurement.

Sakuda stresses the importance of focusing not only on upgrading systems, but on a strategy for integrating them. “In the case of any important issue, like homelessness, so many of the services come from multiple departments, like the Department of Health, the Department of Human Resources or the Department of Education,” she says. “I’m sure the departments want to share information, but they’re not capable of doing that because the systems just don’t allow that to happen in an efficient way.

“You only get data if you invest in the infrastructure, and you nurture that process. Data doesn’t pop out miraculously.”

Government’s tendency to be reactive with technology, waiting until systems are so old they have to be upgraded or risk no longer being supported, has implications on how well government operates, says state Sen. Glenn Wakai.

“Government is really good at collecting data, whether it’s your taxes, or whether it’s your health information. We’re not good at trying to figure out how those two can actually work for us to launch into some new public policy or measure our progress,” he says.

“And that’s because government functions in silos. Many of these various agencies and departments have no idea what their sister agencies are doing. In order to get past that secondary struggle, we need to be able to just cross-pollinate and share data from one agency to another.”


2. Insource innovation

When City and County of Honolulu CIO Mark Wong took on his role, he found hundreds of software systems that didn’t talk to each other, requiring hundreds of thousands of dollars of support from consultants. Instead of paying outsiders to upgrade the system, he decided to save money and give that challenge to his own team, whose time was freed up now that they didn’t have to manage all of the external vendors anymore.

“Government is big enough that they should be solving their own IT challenges. If you think that an enterprise shouldn’t be in the business of developing their own software to gain a competitive edge, or be more efficient, just take a look at Google and Amazon. They have built their entire businesses around the software that they’ve developed to run their own business,” says Wong.

The Lokahi system, built entirely from the ground up by Wong’s team, merges multiple forms of data from various city departments into a single dashboard, allowing employees a more efficient way to see across information that had once been siloed.

“Have you ever watched ‘Person of Interest’ or ‘Hawai‘i 5-0’? In it, you see these ridiculous systems where from just one screen they can see what’s going on in the city, where traffic problems are, what planes are landing. Everything right there,” says Wong.

“Well, we have that.

“Using this single application, you can go back 100 or 200 years to see what businesses were on a particular corner. You can go into the future to see where projects are being planned. You can slice through buildings and see future sea level rise in 3D. You can see in real time what planes are flying overhead, what buses are on the highways, and how many bikes are in each Biki station. All from one screen,” says Wong. 

At the state level, Gov. David Ige is looking for ways to wean government from so many external consultants. To that end, he has supported a pilot project to modernize IT job descriptions and make salaries more competitive with the private sector, a partnership with LinkedIn to bring talent back to the state, an annual hackathon focused on solving government’s tech issues and computer science programs throughout the public school system.

“I want to make working for IT in state government the best job in information technology that anyone could have in Hawai‘i. Part of that is just the breadth and depth of opportunity. We have IT systems in all of the agencies, from financial management, accounting systems, inventory systems, information sharing and insurance. I mean you name it and we do it,” says Ige.

Attracting top talent and fostering innovation in-house just makes sense financially, says Wong.

“It’s typical of government to spend years doing an assessment of the need, and then they hire a consultant to do a proposal. Then they hire a consultant to evaluate the proposals, and then they hire consultants to watch the consultants, and all this to get an off-the-shelf system that wasn’t tailored to their needs. After you spend these millions of dollars training your consultants, and giving them expertise, your employees are left with nothing,” says Wong.

“Take that money and invest it in your workforce and build that capability in-house, and you’re going to end up with a more capable workforce than any local company you could afford to hire. As proof of that, you just need to look at this department. We’re producing all of these things in-house at no additional budget.”

3. Empower employees to question “That’s the way we’ve always done it”

Edward Mersereau describes his first few months working in state government. “I felt like every day I was asking, ‘How come we do it this way?’ And the answer was almost invariably, ‘I don’t know, it’s just the way we’ve always done it.’ And then I’d ask, ‘Well, can’t we do it another way?’ And the answer would be, ‘I don’t know, I’ve never thought about it before.’

“The vast majority of people go into government work wanting to do good, to do something valuable for their community. But what happens is they get bogged down and it gets harder and harder to want to be imaginative or innovative,” says Mersereau, deputy director of the Behavioral Health Administration.

When he first started at his previous position in the Alcohol and Drug Abuse Division, it often took a full year to get service provider contracts approved. Instead of just accepting that, Mersereau dug deep into the regulations and found legitimate exemptions that nobody was taking advantage of. Everybody was just resigned in their belief that the long way was the only way. By doing his homework, he cut the time it took to execute contracts by up to nine months.

“Oftentimes the bureaucracy is important and necessary because state government manages the public trust. But on the flip side, we often get bogged down in what I call ‘adminis-trivia,’ which causes ‘bureaucra-trauma,’ ” Mersereau says, mentioning that his colleagues tease him about his “Eddie-isms.”

Brenna Hashimoto witnessed how certain processes inadvertently created a crisis in the Department of Human Services. Because hiring was so slow, qualified candidates took jobs elsewhere instead of waiting. Dozens of positions for social workers remained unfilled in East Hawai‘i Island and, as a consequence, there were reports that neglected and abused children were falling through the cracks.

“The perception, especially from the Legislature and from other departments was that we were closed off, that we weren’t transparent, that we didn’t work well together, that we weren’t very effective or efficient,” says Hashimoto, departmental human resources officer at the Department of Human Services.

The nonprofit One Shared Future is trying to help. Under its professional training program, a cohort of employees from DHS and the Department of Human Resources Development worked together on some of state government’s most intractable problems. Their project, which they called the Wiki Wiki Pilot, focused on reimagining the process of hiring.

As part of the program, hotel and bank executives shared their professional experiences with the government employees. Inspired by what they learned, the team created a new process, which differed from the established workflow in several ways. First, they empowered individuals to make hiring decisions on the spot so good candidates don’t have to wait so long. Second, instead of telling qualified candidates the department would get back to them, they gave the candidates phone numbers and put the responsibility on them to call. This served to encourage motivated people to stay in touch. By implementing the changes the cross-departmental team had created together, they reduced the hiring process for social workers from an average of 21 weeks to seven.

“The idea was, let’s take what we learned from what the private sector does, because folks who apply in the private sector don’t expect to wait a month or two months or three months for an interview,” says Hashimoto.

One Shared Future founder and strategic advisor Rachael Wong drew on her experiences across different sectors to provide support for government employees who often find themselves caught between established but inefficient processes, and the needs of the people they serve, who may be vulnerable and require services immediately. One Shared Future’s four-month series for government employees includes lectures, team work and time with a range of leaders across public and private sectors.

“Throughout these sessions, people have the time and space that are dedicated to them to learn about self, to learn about their own strengths, to learn how to work as a cohort, and then as a larger department or sector,” says Rachael Wong.

“They can then look at these processes that have been built up over time. And they can say, ‘You know what? The way we’re doing it now is actually a barrier to us being able to provide services out to the community. Let’s try and fix that,’ ” she says.

Hashimoto says that being given permission to step back and evaluate their workflows the way someone from another industry would can result in more effective government. “We often get a bum rap for not being very flexible or innovative. Everyone thinks we love processes and we love forms. That’s because we’re always looking at things with the mindset that we’ve got to defend our actions. But that sometimes stifles creativity and flexibility. So it was nice to be able to draw from private sector experiences and apply them in our culture. It gave us license to think creatively and to believe that it was going to be OK for us to take the risk and do things differently.”


4. Design for systems, not silos

When Michael Formby started working in Honolulu’s Department of Transportation Services, one phone call was never enough to get things moving after an incident on a road.

“It was like a daisy chain. If something happened on a city roadway that was going to impact state operations 200 or 500 feet down the road, I would have to get on the phone and call my state partner and say, ‘Hey I’m doing work on a city roadway, there’s been an accident here.’ Then I would call HPD and tell them, ‘Hey there’s a situation here, can we divert traffic?’ And then we’d have to call the media and tell the media to get this on the radio. And as a result, it took 30 minutes to two hours to activate a system,” says Formby, the former director of the department.

“But if you look at it from their point of view, drivers don’t care whether it’s the city road that got paved or a state road that got paved. They would like to see things done in a way that’s logical.”

The Joint Traffic Management Center in Honolulu will bring all of the players involved in roadway safety into one system and one shared space. Representatives from the police, Fire Department, county Department of Transportation Services, Emergency Services, and rail, among others, will locate in one operation center, allowing them to monitor situations together in real time. This means everything from public safety to information dissemination will happen faster.

The development of this center represents a growing awareness of how effectiveness in government depends on breaking down the silos that characterize its agencies and departments.

“We have a lot of issues, such as homelessness, climate change and education that require multiple agencies to be involved. What happens is that the Legislature and the executive branch delegate certain portions of those problems to different agencies. So you have multiple agencies essentially duplicating efforts because they’re working on them independently,” says Heather Kimball, Hawai‘i County Democratic Party chair and former state Senate candidate.

“The tendency has been to delegate these authorities to groups that are experts in that particular area. So we’ve intentionally created these silos. And then you also have the sort of passing the buck issue, where one authority will say, ‘Well that’s not really within our wheelhouse,’ and then, ‘But that should be taken care of by this agency.’ And then that other agency will similarly say, ‘Well, that’s not our responsibility.’

“We need more of a systems thinking approach. So instead of delegating to smaller organizations, let’s instead create a framework that integrates all of these different departments and agencies in their work,” says Kimball.

As one founder of Hawai‘i Homeless Healthcare Hui, or H4, Lt. Gov. Josh Green also looks for ways that government can work more in systems than in silos.

“The premise of H4 is that you need partners from different sectors to operationalize a successful program that benefits society,” says Green, who is also a physician. With the city of Honolulu contributing $17 million for the location in Chinatown, and private sector players contributing $12 million, H4 provides an integrated service for the homeless that includes health care, hygiene, humanitarian help and housing. When completed, the project has the capacity to save the city and state over $50 million a year on ambulances and hospital fees for homeless individuals needing medical care, he says. The smaller Joint Outreach Center has already saved over $5 million a year in taxpayer dollars.

“Few people will go all-in from the private sector because it’s not a clear economic win. On the flip side, it takes too much time for public programs to get up to speed, enter into a new region and go through contracting. So the private sector was willing to step up if the property was there and the public sector was willing to step up if the service providers and humanitarian capital was there. That’s how we broke down the silos and created a model to tackle chronic homelessness,” Green says.

What’s most important about this systems approach, he adds, is that it also breaks down barriers with the most important stakeholder. “I have standing meetings with leadership, community organizers and private sector guys, and we bring everyone together every three weeks, so that everyone sees the benefit to each group. But most importantly, we’re having the consumers themselves come in and comment about whether they would use (H4) because I don’t want to build something people won’t use. And the philanthropists get to be with the very individuals that they’re going to help, and see them in a nonabstract way. And it’s really empowering for all of them.”


5. Be easy to use

State Auditor Les Kondo says unread reports might as well not have ever been written. “It’s like the tree falling in the forest. Does it make a sound if no one is there to hear it? Likewise, we don’t want to write great reports and talk about a lot of really neat findings and make great recommendations if no one is paying any attention.”

Kondo’s role is to make sure state agencies and programs are held accountable for how they use public money. His team investigates a wide range of issues that the state Legislature brings to their attention, including the relicensing of public care homes, the management of the Deposit Beverage Container program and whether the profession of dental assisting should be regulated. Some of their higher profile cases have brought public attention to instances of fraud, waste and abuse in programs and institutions such as Honolulu rail and the Office of Hawaiian Affairs.

While there are standard requirements for each report, Kondo encourages his team to approach each one as a unique story and to design the reports to maximize engagement among not only legislators but also the general public. The audit on the Office of Hawaiian Affairs, for example, includes sidebars, colorful graphics and flow charts that make information about questionable expenditures easy to grasp and remember.

“A lot of people were perhaps surprised or outraged at what was going on in the Office of Hawaiian Affairs. Since then, the composition of the board of trustees has changed. Do I think the audit is what caused it? No, I don’t. But because our report was covered so heavily by the media, I do think it played a role,” says Kondo.

As editor in the Office of the Auditor, David Choo helps craft the reports into something that transcends the typical dry white paper. “Some of us come from magazine backgrounds. That experience helps because we know people aren’t likely to read 60 page reports from start to finish. They might flip to the middle, or they might read it in pieces. So we try to create multiple points of entry and to tell the stories within stories.”

Jennifer Tadaki Catanzariti, who works with the team on graphics and communications, agrees that visually engaging reports are not just nice to look at, but essential for communicating to a broad audience. “This is one of the keys to transparency and fair, open government. We should provide ordinary people with charts or well-designed infographics, which allow everyone a faster and deeper understanding than a word document in cryptic government language ever could.”

The recently launched Honolulu Dashboard also makes use of simple but powerful visual design to make progress on city initiatives more transparent to the public. A quick glance shows that among its priority areas, the city has exceeded its targets in LED streetlight replacements, but still has some ways to go in providing permanent housing for homeless veterans.

Honolulu deputy managing director Georgette Deemer says: “Government and business are different but we expect the same from both in terms of measuring progress. For a business it’s their bottom line. But for us it’s essentially making good on a promise to the general public to serve. On the city side, that means services that are very close to the ground. It’s public safety. It’s water and sewer. It’s parks, roads and garbage. Things that people may take for granted until they don’t work anymore.

“Oftentimes you make a big splash with an idea or project and then the public never hears about them again. It leads to public mistrust of where the money is going. If you say you’re going to do something and use taxpayer money to do it, you need to show taxpayers their money is spent wisely,” she adds.

The best antidote to feeling frustrated or not trusting government is to get involved, says Virginia Beck. She knows, however, that a lot of people are embarrassed to admit they don’t really understand how government works.

“There’s no shame in not knowing,” says the coordinator for the Public Access Room, a state agency at the Capitol that provides resources for people to become more informed about legislation. The agency’s employees guide people on both written and in-person testimony, find and track bills, provide materials, conduct workshops and answer questions on how to get involved in the legislative process.

Each day, she says, she sees everyone from seasoned lobbyists to people who have no idea who their legislators are yet are nonetheless passionate about a particular topic and want to do something about it.

“It’s our government. So, it really is crucial to try to get involved at whatever level you can,” says Beck.

“I’ve heard stories of testimony that have stopped a bill in its tracks. It may look like they are all ready to move the bill forward, but then a testifier comes in with a story about how this legislation would affect their own life. And that can make it very real to the legislators. They do pay attention to the voices that are raised. It doesn’t mean that they’ll necessarily do what they want. But because not enough people speak up, every voice that does is even more amplified.”