By Steve Kelman
I recently saw a fascinating article in The Boston Globe that caught my eye, both on its own terms and in terms of possible implications for government.
The article was about the sandwich chain Panera Bread establishing a new "Panera Cares Café" in downtown Boston. The café, owned by the Panera Bread Foundation, looks like any other Panera Bread outlet and has the same menu. However, it has no cash registers. Instead, the menu shows suggested prices for each item. People who can afford it are asked to put that amount or more into collection baskets in the restaurant; those who cannot may eat for free or for whatever amount they feel they can pay. Panera is only asking/hoping that the café will cover its costs; there is no expectation that the outlet will make a profit for the company.
My first reaction to this story was that this is a wonderful idea, and an innovation. Some creative person thought up the idea of giving paying customers at the café the opportunity to keep the operation going for those who can’t afford to pay. This kind of approach was pioneered in India several decades ago, where the Aravind Eye Hospital in Madurai used revenues from paying eye surgery patients to fund free operations to save impoverished villagers from cataract-induced blindness.
In a strange (and not quite analogous) way, the gift shops that are now a major source of museum revenue represent a similar idea, namely getting revenue from one group of customers to fund or partly fund a nonprofit operation that otherwise would be dependent on donations.
So a shout-out to Panera Bread for doing this. (I hope it is not abused by people who could afford to pay and choose not to, or by people taking large amounts of food from the restaurant, perhaps for resale.)
I bring up this story in my blog, though, for slightly different reasons related to government management. First, to remind those in government of the power of innovative ideas. I doubt this idea was associated with profit-and-loss responsibility or financial reward. It was just thinking creatively, something that government folks should be able to do just as well.
Second (and much more speculatively – indeed, some may think I'm crazy), I wonder whether some government agencies might experiment with a version of this idea. I like to believe that there are at least some Americans who would like to make a contribution beyond their taxes, however small, to reducing the federal deficit.
People are of course in principle free to pay more taxes than they owe, but when we fork over our taxes, we are probably thinking more about how much we are paying, and not very much in the mood to help more. But what if some government agencies made available the possibility of an additional voluntary donation towards deficit reduction in the context of paying fees for various government-provided services, such as getting a passport or buying tickets to national parks? Obviously, at best the amount of money such contributions would raise would be the tiniest of drops in the deficit ocean. But it would give citizens a chance to show patriotic engagement – and perhaps send a signal to politicians about some willingness to sacrifice in order to get our deficit down.
OK, so maybe I’m crazy. Any reactions?
Posted on Jan 29, 2013 at 2:19 PM8 comments
Steve Kelman is hopeful that the VA's unusual choice to host a competition for an IT system will break new ground. (Stock image)
When I posted on my Facebook page a column about contests (when they’re likely to work and when they’re a bad idea) as a procurement tool, I received a comment from my friend Roger Baker, the dynamic CIO of Veterans Affairs, about a contest the VA is running where they will pay $3 million to the winner who can develop an open-source appointment scheduling system for VA hospitals.
The contest was announced in early January, and entries are due by June 13. (For blog readers unfamiliar with the idea, a procurement contest is one where the government puts out a problem it needs to solve and announces a prize for the first or the best solution to the problem. Anyone may enter – no RFP, no long proposals, etc. Experience shows that winners are typically players the government has never dealt with before.)
The VA had earlier spent over $125 million to try to develop a customized scheduling system, and it didn’t work. This was one of the systems cancelled in a bold move by Baker when he came on board as VA CIO in 2009. I’m sure I’m missing something, but scheduling sounds to me like a fairly widespread commercial business process, and it seems weird that the VA had originally thought to grow their own. If the VA is actually now able to get an application that works for $3 million, after all they’ve spent, it would be an example of the 95 percent cost savings that come up often enough to make the contest phenomenon worthy of further attention.
At any rate, we should be really paying attention to whether the contest idea works here. It has seldom (in fact, I’m trying to be cautious – I actually can’t think of a single example) been used in government to date to try to source an IT application. In the column I wrote (based on a paper by a University of Michigan business school academic), it was argued that contests are less likely to work if the product or service cannot be fully specified and if there will need to be a lot of communication between the buyer and potential contest entrants. Since IT applications typically can’t be fully specified and do require communication, VA’s approach is risky – though hardly more risky than the original decision that led to blowing $125 million on failure going the traditional route.
So this is a project that the IT community should be watching really carefully. One way or another, there are likely to be lessons learned here, which hopefully the VA will share. If this works, it’s going to open a new chapter for IT procurement in the federal government. Hats off to Roger Baker and Peter Levin, the VA’s CTO, for giving it a try!
Posted on Jan 24, 2013 at 2:19 PM0 comments
Crowds filled the National Mall during Barack Obama's inauguration ceremony on January 21. (FCW photo by Michael Hardy)
While in town for this week’s presidential inauguration, I took the opportunity to ask friends I met (all Democrats) a question about the next four years. The question was this: “What’s the optimistic scenario for the next four years that you think has at least a 25 percent chance of happening? And what’s the pessimistic scenario that has at least a 25 percent chance of happening?”
Though not all responses were the same, there were interesting patterns. Basically, the optimistic scenarios involved the economy and the pessimistic ones involved the international scene. One person, for example, felt there was a 25 percent chance that four years from now the Democrats would be able to point to a “Morning in America” moment such as that used by Ronald Reagan in the 1984 presidential campaign – that most of the nation would feel confident that the economy had really come back strongly from the economic crisis.
The worries were international. They worried that Afghanistan and/or Pakistan might collapse in a way that creates real problems for the United States; that terrorism might resurge; that Europe’s economy could collapse; or that there might be trouble in the Middle East such as escalation of hostilities between Israel and Palestine or a revolution in Saudi Arabia).
Interestingly, nobody I asked mentioned improvements in the ability to compromise politically; nor did anyone predict progress or calamity regarding the country’s fiscal problems. I asked about whether an optimistic economic scenario would have any impact on political dysfunction, and the best response I got was one suggestion that economic growth would reduce the urgency of the budget deficit problem.
By the way, a Chinese friend sent me a screen shot of a page on Youku – China’s home-grown equivalent to YouTube – of scenes from the Obama inauguration. One picture showed the President and Michelle Obama dancing, another the inaugural address. Still others showed Jennifer Hudson, Alicia Keyes, and Kelly Clarkson singing. To be sure, these pics were hardly burning up the Chinese Internet. Twelve hours after being posted, they had only been watched 8,000 times. Nonetheless, it’s an interesting sign of the attractiveness of American society and culture in China, and elsewhere outside the United States. (I blogged a few months ago about Chinese kids wearing t-shirts with US flags or military insignia.)
Posted on Jan 22, 2013 at 2:19 PM3 comments