Report looks at bureaucrats as businesspeople

An entrepreneurial spirit taking root in many federal agencies is breathing new life into the way the government does business, according to a new report.

The report, by Government Executive Associate Editor Anne Laurent, says entrepreneurial organizations within government have flourished since the beginning of the Clinton administration, and "intrapreneurs"-employees creating businesses within their agencies-are gaining momentum. The report was funded by a grant from the PricewaterhouseCoopers Endowment for the Business of Government.

"These pioneers are hacking their way out of the stodgy, stovepiped, red-tape-entangled bureaucracy to create new businesses good enough to win work that might otherwise have gone to private-sector firms," writes Laurent.

The report looks at the pros and cons of making government more businesslike, concluding that the movement toward a more "business-permeable" government is inevitable.

Laurent credits the National Partnership for Reinventing Government-formerly known as the National Performance Review-for jump-starting the businesslike government movement in 1993 with its first report, From Red Tape to Results: Creating a Government that Works Better and Costs Less.

On the heels of that report, the Government Management and Reform Act (GMRA) of 1994 established a new franchise business model, allowing agencies to create working capital funds using income from customers to finance current operations, and allowing them to accrue up to 4 percent of earnings annually for major capital investments and management improvements.

Six agencies now have GMRA franchises: the Departments of Health and Human Services, Commerce, Veterans Affairs, Treasury, and Interior, and the Environmental Protection Agency. Congress separately granted the CIA and the Department of Transportation permission to establish franchise-like operations.

The CIA, for example, began operating four enterprises within its franchise: a transportation and storage facility; a telephone service; a motor pool and package delivery services center; and a software development center. With its slogan, "Doing Business Like Business," the agency has customers pay for services out of their own budgets, which makes them prioritize their needs and reduces demand for warehouse services. This strategy saved the agency $6 million in the first year of operations.

The most successful government businesses know how and when to embrace change, the report concludes. Other key characteristics of entrepreneurial government include:

  • Strong, savvy leaders who will champion ideas and forge partnerships.
  • Cost consciousness and a bottom-line business philosophy when it comes to finances.
  • Reliable accounting systems.
  • A customer service-driven focus.
  • Flexibility and creativity in managing fluctuating workloads.
  • Openness to partners.
  • An ability to find profitable business niches.
  • A willingness to take risks and to make mistakes.
"Inculcating these characteristics, attitudes, and abilities more broadly throughout the federal government undoubtedly will increase the chances for success of entrepreneurs in the future," Laurent writes.

Entrepreneurial Government: Bureaucrats as Businesspeople and other PricewaterhouseCoopers Endowment reports are available at

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
We think these reports might interest you:

  • Forecasting Cloud's Future

    Conversations with Federal, State, and Local Technology Leaders on Cloud-Driven Digital Transformation

  • The Big Data Campaign Trail

    With everyone so focused on security following recent breaches at federal, state and local government and education institutions, there has been little emphasis on the need for better operations. This report breaks down some of the biggest operational challenges in IT management and provides insight into how agencies and leaders can successfully solve some of the biggest lingering government IT issues.

  • Communicating Innovation in Federal Government

    Federal Government spending on ‘obsolete technology’ continues to increase. Supporting the twin pillars of improved digital service delivery for citizens on the one hand, and the increasingly optimized and flexible working practices for federal employees on the other, are neither easy nor inexpensive tasks. This whitepaper explores how federal agencies can leverage the value of existing agency technology assets while offering IT leaders the ability to implement the kind of employee productivity, citizen service improvements and security demanded by federal oversight.

  • IT Transformation Trends: Flash Storage as a Strategic IT Asset

    MIT Technology Review: Flash Storage As a Strategic IT Asset For the first time in decades, IT leaders now consider all-flash storage as a strategic IT asset. IT has become a new operating model that enables self-service with high performance, density and resiliency. It also offers the self-service agility of the public cloud combined with the security, performance, and cost-effectiveness of a private cloud. Download this MIT Technology Review paper to learn more about how all-flash storage is transforming the data center.

  • Ongoing Efforts in Veterans Health Care Modernization

    This report discusses the current state of veterans health care


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