Nebraska faces a $1 billion budget deficit in the next two years. That might appear to threaten IT innovation, but Matthew McCarville, the state’s Chief Information Officer, sees it as an opportunity to drive efficiency across state government. That’s because his office, known as OCIO, won’t experience the cuts directly because it’s paid internally for its services, and it is well-situated to help other agencies cope with their shortfalls.
“We’re trying hard to get ahead of that budget deficit’s [effect on] the agencies by being their partner to help them consolidate and save money but [still] achieve all the goals and strategic plans they had before,” McCarville said.
Combine Forces
OCIO identifies technology that’s underused, obsolete or duplicative. That effort uncovers possibilities for reducing redundant applications and hardware, sharing resources across agencies, and trying new, more costeffective options.
“We meet with all the agency heads and say, ‘Here’s what we see you have as far as technology resources. You may not need all these physical servers anymore. Have you thought about modernizing your platform?’” he explained.
The evaluation includes staffing. In some departments, OCIO found that IT personnel sometimes had too much spare time, McCarville said. Centralization allows leadership to redeploy that talent. “We’re able to [serve] those agencies with people that know their agency, but also utilize the excess bandwidth for another agency that may need it,” he said.
Modernize With Care
When he became CIO last year, McCarville said, “I walked into a completely legacy state. We had no cybersecurity, we had no data department, we had no business intelligence tool and we had all mainframes and storage on premises.” Some important systems still use applications written in COBOL, and the court system runs on an IBM AS/400. The state wasn’t using software-as-aservice, and only one agency had used a cloud environment, which it discontinued after a single project.
With old-school tech so firmly embedded, modernization will take time. “I can’t pull the plug on a mainframe in two years,” McCarville said. Instead, he’s making incremental changes. For example, whereas OCIO routinely renewed vendor contracts without exploring alternatives, it now reviews them for updating opportunities as the contracts come due.
Leverage Data and AI
McCarville said his staff jokes that their only interaction with Nebraska’s data center was to make sure the indicator lights were flashing green. “No one ever looked at the data. Now we’re opening up the hood,” he said. The state recently hired its first chief data officer, Prabhakar Vijayarangam, to help unlock those insights. Vijayarangam is also working with vendors to implement AI pilot programs based on that data.
AI is an interesting application for the public sector, McCarville noted. “There’s a lot more risk for doing things wrong,” he said. Again, his strategy is incremental, testing one use case at a time. OCIO vets a project, then hands it off to a vendor for a 90-day pilot, after which OCIO reviews the operational impact.
For agencies facing drastic budget cuts and significant layoffs, AI can help by automating functions so that remaining employees can focus on higher-level tasks. “It’s a great way to introduce AI and show the efficiency of automated programs,” McCarville said.
They’ve learned that some decisions can’t be delegated to AI, however. For instance, reviewing eligibility for programs such as Medicaid and Medicare needs a human touch. “You can’t kick people off because an algorithm told you to. You have to have that human critical thinking in the loop,” McCarville said.
Reskill and Reach Out
To manage its older infrastructure, Nebraska has maintained an IT staff with experience in those technologies — employees who tend to be older themselves. McCarville said 37% are beyond retirement age. Keeping their institutional knowledge while upgrading their skills is a delicate balance. “I’ve got to manage that as carefully and as empathetically as possible,” he said.
Although some workers want to stick with what they know, others are interested in learning. One budget-conscious strategy requires vendors to train workers on any new technology as part of the cost of doing business with the state.
At the same time, the state is building a pipeline of early-career IT professionals with skills in AI, cyber, analytics and cloud. A new office in Omaha will attract university students and younger workers who don’t want to commute an hour each way to the state capital in Lincoln.
McCarville hopes to extend outreach to high school students who might not otherwise pursue higher education, steering them into associate degrees in cybersecurity and other tech fields.
Nebraska has also set up a joint security operations center that helps county and local governments respond to cyber threats as the federal government is cutting those resources. The center will work with colleges and universities to offer cybersecurity training.
McCarville hopes that rural areas, community colleges and schools that often can’t afford IT professionals will benefit from OCIO’s efforts. “We might hire one out of every 10 interns, but we’re going to pump them out to our state — private, public, counties, everybody,” he said. Because OCIO initiatives will affect many agencies statewide, the office must undertake them with care. “This is more change than this agency has had in 20, 30 years. I have to do it in a managed way. It’s going to be a little bit chaotic, but we’re trying to manage it as much as we can,” McCarville said.
This article appeared in slightly different form in our guide, “State and Local: Better Public Service Through Innovation.” To learn more about how state and local governments are enhancing both outreach and efficiency, download it here:
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