From New York Times By Danny Hakim Published: October 15, 2009.

ALBANY — Gov. David A. Paterson proposed billions of dollars in spending cuts on Thursday and raised alarms about New York’s financial health as the state faces a deficit of nearly $50 billion over the next three and a half years.

The governor’s plan, which seeks to close a deficit for this fiscal year projected to be $3 billion, includes cuts to education and Medicaid as well as a grab bag of other strategies, including creating a tax amnesty program and raiding the state’s environmental protection fund.
The plan, which needs legislative approval, also includes a $2 billion reduction in spending for the next fiscal year, which starts in April.

The Governor’s budget cuts are necessary to solve the state’s immediate fiscal problems. But the state has serious roadblocks to the implementation of the major reforms needed to meet its future obligations. These reforms will require Legislative approval for resting control from employee unions which employees are to be laid off. This is important to when downsizing to be sure to reduce management currently protected by length of service to balance layoffs of lower level newer employees. The reforms I recommend will require significant reductions in the state’s management. The reform moves the state’s government from its 19th century bureaucratic structure to a 21st century team managed organization eliminating several levels of management.

The second major roadblock is in the need for the legislature to take control of the states Information Technology systems reform. Most states including New York have “IBM shops” in these the IT managers are closely connected IBM. These IT managers are the first consulted for advice on the reform of state’s IT systems. In most cases as found in other states the IT manager has recommended an IBM solution using IBM’s computers and proprietary software. This may be acceptable in adding to the present obsolete systems. But where major IT systems are to be reformed and the state wants a new integrated IT system following the wrong recommendation could cost the state $billions. An IBM proprietary recommendation would cut out competitors from doing business with the state and may be illegal.

This occurred in the state of Washington where the IT manager tried to use the obsolete IBM proprietary software in the state’s new centralized Data Center. Fortunately the fact that the new center would not have integrated systems was disclosed to the Governor who replaced the state’s IT manager. The state of Washington is now considering the implementation of a Relational Database Management system.

Third reason for action by the state legislature is that the reforms must be sanctioned by law and not seen as an initiative sponsored only by the governor since the reforms will likely take some years to be fully implemented.

The following is a summary of my reforms to the New York state government.

The Streamlining of New York’s Boards and Commissions Using Lean
I recommend the following approach, organize a select group of employees into a high level Lean Team to study this process to find the best way for the public to interface with government for services similar to what the state of Iowa is doing. Then organize functional Lean Teams in each of the boards’ and commissions’ functions to find the best way of doing each function similar to the way Minnesota is doing it.

Next, I would follow one of the best examples of government innovation developed by the city of Hampton Virginia. (On my website read my Article 101. The Hampton Virginia Innovation story.) With the Hampton Virginia system adapted by the state the public when needing services would call a State Centralized telephone Portal called a Customer Relations Management (CRM) system for services rather than going to each agency. Telephone call takers answer questions take applications and do anything required for the service for all of the 270 agencies. Call takers are supported by a Frequently Asked Question (FAQ) database. The agencies and entities are streamlined and combined with the number of them being significantly reduced to around 25. Service to the public is provided 24/7 with the number of trained call takers on duty dependent on the number of customer calls received.

I further recommend the implementation of a new Centralized Relational Database Management System RDMS similar to that being developed in Washington State. The RDMS is developed completely separate from the current obsolete agency computer systems. No funds should have been wasted on trying to patch the old systems. When the New Centralized Data Center and its systems are up and running the plug is pulled on the old systems.

Another recommendation is for the consolidation of all government services into a single state wide organization. The idea is to combine all support services into a centralized state Shared Services Department (SSD). Within the SSD organization is: Purchasing, Information Technology, Janitorial Services, Waste Management, Travel and expense, and others.
My final recommendation is for streamlining by eliminating levels of government and downsizing the way agencies are organized through the elimination of their bureaucratic structure. The high level Lean Team after completing their work on the reorganization of New York’s board’s and commissions’ is then merged with Top Management to become the Top Management Steering Team. Group Steering Management Teams are formed from mid management with Functional Lean Team Management reporting to them from the lower level.

What’s different from these reforms?
The State of New York has moved from its 19th century bureaucratic organization to the 21st century Steering Management Teams and Functional Management Teams. The state has a Centralized Database facility with a RDMS with query capabilities similar to that of Google and costing far less than the current systems to maintain.

See the details of these reforms in my articles on my website: http://managementconsultant.blogsome.com
Article 151. The Promise of Going ‘Lean’
Article 152. The Process of Replacing Bureaucratic Management With Lean Teams
Article 153. Example of the Advantage of a Relational Database
Article 154. Streamlining Iowa Boards and Commissions Using Lean and More
Article 156. Getting the most out of Lean as used in Government
Article 157. Using Lean to Balance Agency work Loads
Article 158. The Streamlining of Georgia Boards and Commissions Using Lean
Article 159. Mean, Lean Reform In Government Accounting
Article 160. Minnesota State Government Leads the Nation in Lean
Article 161. IBM The Most Costly Hoax of the Century
Article 162. Bringing Virginia’s State Government Back on Track

Update November 25, 2009

GOVERNOR PATERSON PROPOSES EMERGENCY LEGISLATION IN ADDRESS TO NEW YORKERS

Executive Authority Option Grants One-Time Authority to Close Current-Year Budget Deficit. Permits Governor to Administratively Reduce Payments Across-the-Board by an Amount Needed to Bring the 2009-10 Budget Back into Balance
Legislation Provides Critical Tool to Protect State’s Finances during Unprecedented Fiscal Crisis.
Grants the Executive Branch the one-time authority to administratively direct the reduction of 2009-10 fiscal year payments in order to close a $3.2 billion current-year budget gap. This is directed at the current budget shortfall.

This may lead the way to legislate the reforms needed to meet future budget shortfalls as I have suggested above.