As told to Diane Brady this afternoon at the Bloomberg Enterprise Technology Conference in New York City. Edited and condensed for clarity.
My first day on the job, I was so excited. I walked in and my team handed me a stack of documents and said, "Here are projects worth billions and billions of dollars," a $27 billion stack, that are behind schedule.
Everyone thought of the Obama campaign very much as the sleek wave of the future. But once you get to Washington, you're inheriting Middle Ages technology.
Part of it is just public sector technology. In the 1960s, governments were the centers of innovation, the only ones who could pay for technology. Then, in the 1980s, innovation moved to multinational corporations. Since then, all the action has moved to the consumer Web.
One of the greatest assets I brought to my job was my naiveté. I thought I could really change things. I told a senator that, in 60 days, I would launch a dashboard showing Americans how their taxpayer dollars were spent. And the team behind me said, "Nothing gets done in 60 days!"
A lot of people were not very happy. But the outcome changed that. Within six months, we found $3 billion in savings. Just by shining a bright light and making people accountable for taxpayer dollars.
People had this image that CIOs were victims, rather than enabling change in the public sector. There's a natural tension for every CIO in terms of being an enforcer and being an enabler. Unfortunately, most CIOs end up picking the enforcer role. I think it's an active choice they make. They become "Dr. No," and nobody wants to deal with them.
I remember going to Silicon Valley and meeting companies, and I told them, "Why don't you come in and disrupt the government sector?" I asked one, "Why aren't you competing for the government sector?" And he said, "We already have a lot of government people using our services," in an unauthorized fashion. So you lose security there.
CIOs are not thinking what the business problem is, they're thinking about spending technology dollars.
I instituted a cloud-first policy because I saw waste. The U.S. government had 2,090 data centers by 2009—at 27 percent utilization! So the government was building all this capacity that wasn't being used. It's very easy to say that you've got an IT project, you're building infrastructure, providing compute and storage. But look at the average consumer's experience with government: you're on the phone.
I've seen a massive shift in IT spending. From a cloud perspective, the austerity measures in the UK, they've come out with a cloud-first policy. In Japan, the government is trying to return from [the effects of the 2011 earthquake] and architect things better. In the U.S., there's downward pressure to do more with less. But not in the traditional definition, though.
Some agencies are leapfrogging. A lot of agencies made investments a decade ago and spent more on people to support them, and now can't afford an army of a thousand consultants on a project.
I'm now executive vice president of emerging markets at Salesforce. The Salesforce model from the very beginning bypassed the CIO to the business executive. Now, the CIO is definitely in the room, given the broad transformation. But the conversation is being driven with the business side because they have a deeper understanding of what they're catalyzing.
Emerging rock star CIOs are thinking about how to reinvent a company like Starbucks and fundamentally rethink the in-store or retail experience.
I recently met with the City of Philadelphia, and all these people were in the room. I learned a few things I didn't know. Take education, for example: 54 percent of people in that city don't have access to a computer, yet a majority have cell phones, mobile devices. How do you reinvent government services with a mobile-first experience? How do you create the equivalent of a 911—just dial a number and you get a real person—for government services?
Social media. For the first time, you can provide a customer experience that you couldn't in the past because they're tweeting and posting on Facebook. Companies are reinventing themselves to become "customer companies." You have to listen to them, connect to them on a real-time basis, but your products and employees are connected, too. In the past, you had asynchronous communications.
Privacy, security. From an enterprise perspective, it's all about transparency. At the end of the day, it's all about trust.
In government, when it comes to privacy and security, technology has tended to move much faster -- as it should -- than the legislative process. It would be interesting to think about it the way the [U.S. Food and Drug Administration] thinks about food: very simple labels, number of calories, how healthy the food is. What if you could simplify privacy at that level and have consistent application?
We're living in a world that's evolving so fast.
Looking back, I would have probably worked with Congress sooner. I would have also implemented the quarterly cadence that Wall Street has. But I don't think it's one thing. It's putting in place that discipline, that intensity, and have it very metrics-driven.
One of the craziest things we do in the U.S. is immigration. We kick the brightest people out instead of giving them a green card. We're not doing enough in the K through 12 system, either, but we're also kicking out the brightest people and sending them to their home countries and having them set up companies to compete with us. They could be creating a more perfect union here.
The number one question I hear from people is whether their company is facing extinction. How do you make sure you're not the next Borders, but Amazon? Not Blockbuster, but Netflix?
Governments have natural monopolies. They're going to stay in business.
We're seeing a complete reinvention in marketing. Look at the role of the CMO—they're used to looking at business through the old channels: newspapers, television, print magazines. How do you tap into a billion-plus users on Facebook? Or Twitter, or LinkedIn? That entire category is going to be fundamentally disrupted.
It's about, how do you make sure, as a CMO, that you create a personalized experience? People expect it now. Think about when you walk into a hotel for the twentieth time and they don't know who you are. Virgin America is working on a project where, if you're on a flight from New York to San Francisco, they can collaborate with you—on your favorite restaurant reservation, or connecting to a [rental] car faster.
When I was in the White House, we noticed an issue with student aid applications. It was this really complicated form. Students would stop filling it out. They were asking the same questions for the [Internal Revenue Service] as the Department of Education. We asked, how do we simplify the form? Share the data. But there are privacy laws against that. So we eliminated, with technology, 70 questions. And they can still keep the data separate.
Technology is going to disrupt that citizen experience while respecting the privacy of the individual.
When I look long-term—five, 10, 15 years from now—you're going to see entire sections of the economy being reinvented. Just think about neighborhoods: kids now have digital constructs, not the physical construction I grew up with. I don't think any country or union has an answer for this yet. It's bleeding into how [elected officials] run their country.