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Article 144. Why States Lose Millions by Using Obsolete Computer Systems

There is an incredible lack of understanding of computer systems mostly of a technical nature among state Decision Makers who time after time turn to the wrong people for advice on how to fix their state’s computer problems. Bad IT decisions come about mostly by the failure of Decision Makers in the past who were not computer literate and by the piecemeal stop gap fixing of obsolete stand alone computer application programs. Decision Makers in many cases are led astray by self-serving Information Technology (IT) Managers who wanted to keep their programmers busy by patching and developing new application programs for their obsolete systems.

System implementation planning failures are generally the fault of the Decision Makers funding the project. It wasn’t but a few years ago when almost none of the leaders in government had any computer experience at all. They relied completely on their Information Technology (IT) manager for planning and implementation of computer systems. Even today the situation is not much better. Faced with throwing out all of the present computer applications and implementing what is needed a Relational Database management System (RDMS). IT managers fight to continue their obsolete systems pointing out the cost of bringing up a new RDMS. This argument pales in light of the losses to the state from Medicaid fraud and the inability to manage state services over and above the added cost for maintaining the present obsolete systems.

But what if the Federal Government were to fund the state’s development of their computer applications and RDBS? This is exactly what I have proposed in my Article 120. Homeland Security is trying to find a way to link all of the states’ motor vehicle registration databases through an unfunded mandate called the Real ID. On the surface this appears to be nearly impossible task since nearly all of these databases have been developed as proprietary systems.

The answer is to have the federal government fund the state’s development of the software application program for a state motor vehicle Relational Database (RD) and give the software to each of the states. Each state would then load the new RD with the motor vehicle data from their old proprietary database. Since the state RDs are easily linked this would provide a giant national motor vehicle RD which could be easily accessed by law enforcement and Homeland Security. See my Article 120 and Article 138.

Among computer literate personnel an organization’s computer department is known as an IBM “shop” or a Digital Equipment “shop” meaning that the organization only uses a specific type of vendor computer hardware. It also means that only IBM or Digital Equipment software is used. When the IBM Operating System software is used all Application Programs are written to run on it. The result is that if the organization only has IBM computers you will most likely get an IBM solution. And you will not get a system that can be integrated with other non-IBM systems. What I have observed is that most IT managers are more loyal to their “shop” (vendor specific system) whatever it is than they are to state Decision Makers. The same problem occurs when Decision Makers seek to contract out services few of them seam to be aware that they are getting a proprietary solution when they contract services to an IBM shop nor do they seam to care about the cost except when there is a major failure and yet they still don’t know what went wrong.

Problems in Missouri:
Most states including Missouri have been developing or purchasing stand alone application programs which store their own data internally. When it becomes necessary to link one application with another a special linking program has to be developed so that an application program can share data between them. This obsolete system is more costly to maintain than a Relational Database Management System (RDBMS) using SQL (Structured Query Language). A RDMS has a different architecture, an application program does not store its data within itself but rather stores its data in separate relational databases (RDs). All application programs in the system can access any of the relational databases (RDs) as it needs data for running its application. This means that the amount of stored data in a RDBMS is significantly less since it is not duplicated over and over as it is in the old application programs.

Missouri is still using IBM’s DB2 databases which have been obsolete for the last twenty years. It is a part of the state’s aging computer systems which is a stand alone system and can not be integrated easily with other systems. See my Article 143.

Problems in Washington State:
From The Olympian August 4, 2009
Rep. Reuven Carlyle, a Seattle Democrat and software entrepreneur, says the state is making a mistake with the data-center portion of the project, which accounts for $180 million of the $255 million project cost. Carlyle said it ignores the biggest problem, the state’s aging pieces of information technology that do not have the ability to talk
to each other.

Carlyle is correct if this project does not upgrade the states information technology (computers and software) allowing for the ability to talk to each other then this project is one huge boondoggle. The answer is in making computers and software independent. Software should be easily integrated with other software and able to run on any off-the-shelf computer. This allows for the flexibility of upgrading to a newer faster computer from any supplier without having to rewrite all of the software which runs on the current computer. If the state of Washington is not using the above RDMS architecture or one of similar capability then it is indeed making a $180 million mistake.

Problems in Indiana:
Ref: Glitches Mar Indiana’s Effort to Outsource Social Services By WILLIAM M. BULKELEY WSJ August 12,2009
Processing of welfare, food-stamp and Medicaid claims in Indiana was plagued with difficulties when the state outsourced the system to International Business Machines Corp. and Affiliated Computer Services Inc. two years ago. The problem hasn’t been resolved since then.
“There’s a myriad of problems,” said Anne Murphy, secretary of the state’s Family and Social Services Administration. “Error rates are too high. We’re not processing claims within federal guidelines.”

IBM, the prime contractor, along with Affiliated Computer and other firms agreed to run the programs for $1.34 billion over 10 years. Ms. Murphy said she ordered IBM to delay a planned roll-out to the rest of the state — about 40% of the population is currently covered — and to fix the problems by the end of September.

IBM and the state said they expect to resolve difficulties by then. Problems were partly caused by a surge in aid applicants hurt by the recession and severe flooding in the state last year, Ms. Murphy said.
Defenders of the outsourcing say the programs were clogged with paperwork and riddled with inefficiencies before the changes. Republican Gov. Mitch Daniels, an outsourcing advocate, blasted the old system as a “monstrous bureaucracy.”

Outsourcing critics say Indiana’s problems show why government functions, particularly human services, shouldn’t be turned over to private contractors. Outsourcing of state-government functions remains rare but is attracting growing interest from states anxious to control costs and avoid capital outlays on new computer systems. Many such projects aim to use digital records to replace paper, much as health-care reformers promote electronic health records. Indiana estimated that outsourcing its benefits operations would save nearly $500 million overall.

Note that the Governor and the state’s Decision Makers have all missed the point that substituting one a bad manual system for an obsolete computer system leads to a second failure. What should be done is for the state to develop a State Centralized RDMS and bring back its privatized services.

The problem with outsourcing IT to run social systems is that if for example IBM is the contractor you more likely end up with an IBM solution. So what’s wrong with that? Just this IBM builds their own proprietary systems which can not be integrated with the rest of the states systems in short the same old stand alone systems that most states already have. This occurs because those in charge of letting these contracts are lacking in the fundamentals of RDMS knowledge.

Problems in Texas:
The state of Texas in 2007 ended a $899 million contract with Accenture Ltd., under which the computer-services firm was supposed to process applications for children’s health insurance, food stamps and Medicaid, amid widespread reports of failures to give applicants their benefits. A spokesman for Accenture said the company and Texas mutually agreed to discontinue the contract.

After the contract began, some 1,500 state workers became employees of Affiliated Computer, a big Dallas-based outsourcing company. Although IBM is the prime contractor on the deal, Affiliated gets the lion’s share of the revenue, according to a person familiar with the matter. Affiliated referred questions about the contract to IBM. IBM declined to comment further.

This is just another example of a boondoggle of misspent state funds. The State of Texas needs to develop a State Centralized RDMS and bring back its privatized services. If my recommendations for the elimination of bureaucratic government are followed the state will be able to operate these services for less cost than a private company. See my Article 112.

Problems in Virginia:
Ref: Candidates for state IT chief emerge by Jeff E. Schapiro Richmond -Times Dispatch Aug 12, 2009.

…(The hiring of)Virginia’s information-technology chief, whose first task will be to salvage the state’s troubled relationship with Northrop Grumman. …The Northrop Grumman agreement with the state is to manage computer and related services under a 10-year, $2.3 billion contract — state government’s richest privatization deal.

If my hunch is correct this could be the biggest boondoggle of misspent state funds ever! Northrop Grumman is unlikely to use a RDMS.

See the following articles for more information:
Article 46. Why some Computer System Implementations Fail.
Article 84. The Failure to Manage State Resources due to Obsolete Computer
Article 101. The Hampton Virginia Innovation Story
Article 102. Government Reform of California Agencies and Commissions
Article 103. Reforming Bureaucratic Government the Subtle way by Bringing Innovation to Government
Article 106. Where do the Government Reform Savings Come From?
Article 112. Using Surplus Government Employees to Take Back Privatized Contracts
Article 120. Collaborative Innovation between States and Federal Government
Article 138. State Information Technology Centralized Data Centers
Article 142. Huge Savings from State Centralized Services
Article 143. Examples of a Relational Database Management System

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