Editor's Notebook - July 1999

tclark@govexec.com

Timothy B. Clark

Cover headlines are sometimes hard to write. We work to find a combination of words to meet a combination of goals. First, we must fairly characterize what we're writing about. At the same time, we need to keep it short-the fewer the words cluttering the cover, the better. We want to intrigue the reader too, hinting at points of interest to be found by turning to the cover story. And the words must work with the cover image, whether it's a photograph or an illustration.

This month, we had a spirited debate before settling on "The Company Goes Commercial." Nitpickers argued that no one in government really calls the CIA "The Company," and that this moniker was in vogue only among spy novelists. These naysayers argued for another headline: "The Intelligence Business." They did have a point, since our article centers on the CIA's efforts to become more efficient and businesslike. But I liked the counterintuitive notion that a company-by definition a commercial entity-would need to "go commercial." And the reforms being driven by CIA deputy director Richard Calder do adopt commercial cost and pricing models. Moreover, some of these newly entrepreneurial units are actually in commerce-selling services not only internally but to such outside customers as the State Department and the FBI.

Need an automobile equipped with armor? Want your most sensitive possessions rendered unrecognizable by the world's best supershredders and megacrunchers? Want very secure packing and shipping services? Come to Langley and you'll be treated to top-quality service at reasonable prices. That's the pitch-and we found the arrival of entrepreneurial commerce at the CIA, of all places, a compelling story.

At the heart of the story is pricing theory. At the CIA, as elsewhere in government, many administrative services have been viewed as "free" by consumers, since their costs weren't included in the consumers' budgets. With little constraint on demand, consumption was heavy and no incentives existed for efficiency or cost-cutting. The solution has involved reallocating budgets to the consumers and making them pay for the services they need-whether from Calder's newly cost-conscious business units or from suppliers outside the agency.

The migration of costing, pricing and management techniques from the private sector into government-and the outsourcing of more and more functions to private organizations-have been important trends in the 1990s.

You can see the hunger for information about these developments in the agenda for this month's Excellence in Government '99 conference. The program for the event, which will be held from July 13 to 15, was devised by a committee drawn from agencies across government. The topics include "Government and Entrepreneurial Partnerships," "Customer-Driven Organizations," "Performance-Based Contracting" and "Reinventing the CIA's Business." In addition, the CIA's Dick Calder will give one of the plenary keynote speeches. More than 800 people have already signed up for the conference, but space may still be available. For more information, call 800-868-9445 or go to www.excelgov.com.

A special supplement on key management trends that will be discussed at the conference is found in this issue of Government Executive.

Tim sig2 5/3/96
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