Federal Franchisers


Four years ago, Susan Spurling's boss called her into his office and asked her to run the Department of Veterans Affairs' franchise initiative.

Spurling recalls the question she had to ask: "What is a franchise?"

Four years, six business lines, and a Hammer award from Vice President Gore later, Spurling has helped define the VA's franchising effort. Now, when other agencies ask what a franchise is, Spurling is the one who gives the answer.

"I believe it is the future of government," Spurling says.

The National Performance Review concluded in 1993 that agencies were wasting money by depending solely on administrative services, such as payroll processing, from within their own departments. The NPR's report said that "the administration should encourage operations of one agency to compete with operations of another."

Congress liked the idea enough to authorize the Office of Management and Budget to set up a franchise fund, in which six pilot agencies would be permitted to sell their support services to other agencies.

Along with VA, the departments of Commerce, Health and Human Services, Interior and Treasury and the Environmental Protection Agency were selected to test the franchising concept.

VA offers six services: information technology, security, training, financial management, human resources and payroll, and records storage. Its support facilities range from a law enforcement training center in Little Rock to a financial management center in Austin, Texas, to a cave in Missouri that serves as a storage facility. On Oct. 1, VA's franchise efforts stopped receiving appropriated dollars, becoming completely reliant on the reimbursable funds paid to them by their customer agencies.

Spurling's job now is to keep her current customers happy and attract new ones, which is quite different from her old job as a program manager.

"I think for me the difference is I'm focusing on meeting the customers," Spurling says. "My scope is broadened."

Spurling says competition has driven both VA's service providers and its customers to become more cost-conscious. Requiring agencies to define how much they are paying for services makes them pay more attention to details like the cost of paper, so VA's financial management service offers them a paperless payment process to reduce overhead. Customers who use VA's storage service are looking more closely at their storage costs now that they see how much their paying, and are therefore less likely to leave obsolescent materials sitting around in VA's cave.

Spurling says the competition is good for everyone--customer agencies, service providers, and even federal employees themselves.

"It rewards employees by giving them a rich environment to work in," she says.

Stay up-to-date with federal news alerts and analysis — Sign up for GovExec's email newsletters.
Close [ x ] More from GovExec

Thank you for subscribing to newsletters from GovExec.com.
We think these reports might interest you:

  • Sponsored by G Suite

    Cross-Agency Teamwork, Anytime and Anywhere

    Dan McCrae, director of IT service delivery division, National Oceanic and Atmospheric Administration (NOAA)

  • Data-Centric Security vs. Database-Level Security

    Database-level encryption had its origins in the 1990s and early 2000s in response to very basic risks which largely revolved around the theft of servers, backup tapes and other physical-layer assets. As noted in Verizon’s 2014, Data Breach Investigations Report (DBIR)1, threats today are far more advanced and dangerous.

  • Sponsored by One Identity

    One Nation Under Guard: Securing User Identities Across State and Local Government

    In 2016, the government can expect even more sophisticated threats on the horizon, making it all the more imperative that agencies enforce proper identity and access management (IAM) practices. In order to better measure the current state of IAM at the state and local level, Government Business Council (GBC) conducted an in-depth research study of state and local employees.

  • Sponsored by Aquilent

    The Next Federal Evolution of Cloud

    This GBC report explains the evolution of cloud computing in federal government, and provides an outlook for the future of the cloud in government IT.

  • Sponsored by LTC Partners, administrators of the Federal Long Term Care Insurance Program

    Approaching the Brink of Federal Retirement

    Approximately 10,000 baby boomers are reaching retirement age per day, and a growing number of federal employees are preparing themselves for the next chapter of their lives. Learn how to tackle the challenges that today's workforce faces in laying the groundwork for a smooth and secure retirement.

  • Sponsored by Hewlett Packard Enterprise

    Cyber Defense 101: Arming the Next Generation of Government Employees

    Read this issue brief to learn about the sector's most potent challenges in the new cyber landscape and how government organizations are building a robust, threat-aware infrastructure

  • Sponsored by Aquilent

    GBC Issue Brief: Cultivating Digital Services in the Federal Landscape

    Read this GBC issue brief to learn more about the current state of digital services in the government, and how key players are pushing enhancements towards a user-centric approach.


When you download a report, your information may be shared with the underwriters of that document.