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Practical advice for federal leaders on managing people, processes and projects.

Turnaround Artist

For at least a decade, Ramesh Punwani's trusty sidekick has been a Hewlett Packard 12C business calculator, a vintage model which - it's rumored on the Internet - is sturdy enough to go in one end of a hippopotamus and come out the other still working. Punwani's wife and two daughters refuse to touch it, but not because of the images that claim evokes. To them, the 12C's reverse Boolean logic is, well, illogical. He loves them anyway.

Punwani is one of the few dads who can boast he accompanied his daughter to a Guns N' Roses concert and liked it. But, he says, "I walked out of a Metallica concert with a left eardrum that I thought was totally shattered." The chief financial officer of the Federal Aviation Administration is first and foremost a family man.

He's also a turnaround artist who's been summoned numerous times to lead companies back to the fiscal basics of good, solid financial data and disciplined reporting. In early 2004, when FAA Administrator Marion Blakey told Punwani she wanted him to implement the best practices of the private sector at her agency, the veteran travel industry executive had trepidations.

People had warned him about how difficult it would be to make change happen in a bureaucracy. More than 18 months later, he says, there are no worries. "There are a lot of very talented people in this organization and I can honestly represent that . . . the focus on financial management is starting to be felt in the agency."

It wasn't easy leaving his older daughter, a financial analyst in Princeton, N.J., to take the job, but the move allowed him to be close to her younger sister, an e-commerce manager who works in suburban Washington. If that and FAA's mission of managing, operating and modernizing the world's safest and most complex aviation system weren't enough of a draw, Punwani came away from the job interview convinced that Blakey is a visionary.

"She wants to make the FAA operate like a world-class organization. That's exactly the type of person I want to work for," he says. Besides, after 30 years of putting up with corporate turbulence, the world of public service must not have looked half bad.

Punwani came to the United States from India in 1964, planning to stay just long enough to earn a master's degree in management science from Cornell University. But he inadvertently got hooked on "the good life," he told Crain's New York Business in 1993, and soon found himself gaining corporate altitude at Trans World Airlines. Going to school at night, he earned a second master's in business administration from New York University in 1978.

Punwani departed TWA as vice president of finance in 1986 and moved to Pan American World Airways as chief financial officer, only to see the pioneering airline go belly up after the 1988 bombing of Flight 103 over Lockerbie, Scotland, and the 1991 Persian Gulf War. He was becoming somewhat of a specialist in financially troubled companies by 1993, when he joined a new management team at Empire Blue Cross and Blue Shield. Their goal was to make their company the premier insurer in New York state. He started cutting costs by cutting some of the 400 or 500 positions under his control.

Three years later Punwani followed his heart and the smell of jet fuel back to the aviation industry. He and other executives were hired in 1996 to turn things around at Tower Air, a low-fare carrier hobbling under a soaring customer complaint rate and federal investigations for alleged safety violations and nepotism. Punwani and others were shown the door in the next management upheaval in 1998. Tower went bankrupt and stopped flying two years later.

In 2000, Punwani joined, which grew to become a $3 billion enterprise and the largest publicly traded e-travel company. He moved in 2002 to Cendant Corp., a distributor of travel and hospitality services, as vice president of global strategy.

"We needed someone who could balance a $14 billion checkbook, and we found him," Blakey said after hiring Punwani. "Ramesh brings financial, management and technical skills that are tailor-made for the agency. He knows budgets, and he knows aviation. It's just the right mix for the FAA."

He's spent much of the past year and a half implementing new general ledger and managerial reporting systems to ensure that all budget decisions are based on solid data. Another effort that consumes his time is making sure FAA has good systems to track its spending.

The agency has been criticized by the Transportation Department's inspector general and the Government Accountability Office for cost and schedule overruns. Punwani gets monthly progress reports. One of the simplest solutions he instituted was breaking down major investments into manageable segments before the expenses are approved.

"We're building in an awful lot of checks and balances . . . stuff that I used to do in the private world, to screen potential investments to show that they are well justified," Punwani says. Instead of giving program managers a blank check, he tells them, " 'We're going to give you X percent of the money. You come back six months from now and show us how you've progressed before we give you the next allotment of money.' It's good business management."

Contracts now focus on cost control. They're tailored to reduce unit costs for purchases of computers and other items. Any new contract worth more than $10 million requires Punwani's signature of approval.

Strategic sourcing is another way FAA is controlling costs. On Oct. 4, Punwani oversaw the hotly contested transition of 58 automated flight service stations and 1,700 employees to Lockheed Martin Corp. under a $1.9 billion contract that is expected to save the government $2.2 billion over 10 years.

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