CHANGE MANAGEMENT DELIVERS FOR AUSTRALIAN SOCIAL SERVICES
In 1997, the newly elected conservative Australian government moved to overhaul its country’s social welfare services. At the time, nearly one-third of Australia’s 20 million citizens were receiving payments because they were retired, single parents, unemployed, disabled, students, members of the indigenous population, or fit into other categories of eligibility. Two government organizations served the vast majority of these recipients: the Department of Employment, Education, Training and Youth Affairs (DEETYA) and the Department of Social Services (DSS). DEETYA’s main function was to help find jobs for the unemployed through its nearly 300 field offices. DSS provided its services through another 300 regional offices. The two departments employed more than 30,000 workers combined.
Although the DSS benefits system had breadth, it lacked efficiency and was far from customer- friendly. The typical DSS office had a staff of 65 employees. Each office served hundreds of claimants daily covering a variety of benefit types. The process by which a customer filed a claim seemed more intent on weeding out the pool of recipients than providing benefits.
DSS put applicants through a series of interviews, assessments, and reviews to ensure the completeness and accuracy of their applications, as well as their eligibility. The officers of the department did not make decisions during a claimant’s first appointment, and first-time applicants often had to return anyway because they weren’t prepared with all of the information that the application required.
When Prime Minister John Howard’s administration took office, one of its first initiatives was to transform the often-aggravating and unfriendly experience of visiting DEETYA and DSS offices into a single, customer-friendly ebusiness within five years.
Among the obstacles were a long-standing rivalry between the departments and a complicated merger of their thousands of employees. The new agency was named Centrelink. To fill the position of chief information officer (CIO), CEO Sue Vardon looked not for a technical expert but for an exceptional mind. She found one in Jane Treadwell, a former colleague at the South Australia Department of Correctional Services. Vardon valued Treadwell’s intelligence and herability to forecast the future impact of present decisions. She brought a business perspective to a government agency that had an IT problem. To prepare for the challenge, Treadwell studied change management and visited government agencies around the world. Then she set about the task of convincing traditionalists in the government that information systems were not a money pit and that the $312 million price tag of Centrelink would pay dividends.
To achieve its goals, which included self-service telephone and Internet channels for benefits transactions, Centrelink was not able to rely on prepackaged solutions. The organization developed its own customized middleware called the Centrelink Online Framework (COLF). To create viable self-service products, the information systems team had to translate more than 500 pieces of software program code from data dictionary tables in the organization’s legacy systems into appropriate conversation prompts for voice recognition software and user- friendly forms for Web pages. Both the telephone and Internet channels were designed to mimic the interaction between a live staff person and a Centrelink customer. Clients can review and update their accounts easily, with the added comfort of anonymity. Centrelink processes information and resolves claims more quickly than its predecessors did.
Customer satisfaction with Centrelink has risen by 23 percentage points since Treadwell’s arrival, up to 86 percent. In 2002, Boston Consulting Group measured a 21 percent increase in productivity over the first five years of Centrelink’s existence.
Much of the credit is given to Treadwell’s management and organizational techniques. She changed the perception of IT by incorporating it into upper management and the business realm. Under her leadership, there were no IT projects, only business projects. As a result, Treadwell added the title of Deputy CEO of Business Transformation to CIO.
Treadwell was innovative in other ways as well. Knowing the importance of managing change in a business carefully, she created the Guiding Coalition, which consisted of all 60 Centrelink executives. The Guiding Coalition met every six to eight weeks to see how information technology could promote new opportunities in service. Treadwell also eliminated traditional employment positions in her business transformation group.
Employees there are considered part of a talent bank. They are assigned to roles and projects and reassigned when projects end. The goal is to avoid stagnation that can result from permanent positions. Centrelink now operates the second-largest call center network in Australia. Centrelink’s 1,000 offices oversee payments totaling $55 billion (AUS) for 25 government agencies. Having fulfilled her goals, Treadwell left Centrelink in the spring of 2005 to become CIO of the government of Victoria.
Source: Lauraine Sayers, “Aussie Whirlwind Sweeps through Government IT,” CIO Insight, www.cioinsight.com, accessed May 5, 2005.
Case Study-6 Questions
- Discuss problems Australia’s social welfare system was facing.
- Analyze the role of Centrelink in helping social welfare system. Did Centrelink attempt to
solve problems in the social welfare system?
- Discuss what, how people, organization, and technology factors impacted this problem
and its solution?
- Describe the role of information system in the above case study in your own words.