24 May CIO Leadership Series: David Melbye, Milwaukee Metro Sewerage District
Milwaukee, Wis. – David Melbye hasn’t been a chief information officer for very long, but he already has a significant information technology project under his belt.
Melbye, CIO of the Milwaukee Metropolitan Sewerage District, is wrapping up a major IT overhaul that required both organizational acceptance and phase-by-phase approval by the district’s governing commission. While he’s pleased with the results, the project offers plenty in the way of instruction to CIOs in both the public and private sector.
Lesson number one is that communicating information technology issues to peers in the organization is something that you can’t do just once. As is the case in advertising, where influencing our buying habits is the Holy Grail, information technology messages have to be communicated over and over again to influence behavior and, in the case of IT conversions, “buy-in” habits.
“I think it’s an area that they [end-users] are not familiar with,” Melbye said, “and I think they need to hear it multiple times so that they can work with you toward achieving the goals that you set collaboratively.”
The accidental CIO
A 1985 graduate of Lawrence University with degrees in mathematics and anthropology, Melbye moved to Milwaukee to work for Anderson Consulting, which is now Accenture. For six years, he worked on project management and business analysis in the company’s utilities practice, performing financial systems work for public utilities like Wisconsin Public Service and Wisconsin Gas, which is now part of We Energies.
He left Accenture in 1991 and helped start a consulting practice with a company called Ameridata, which was later sold to General Electric. He got out of the consulting business in 2002 and joined the sewerage district, starting as the manager of information technology. He was promoted to chief information officer earlier this year.
As Melbye surveyed the district’s IT landscape, he realized that a technology upgrade was necessary. Some of the 23 applications on the district’s old DEC Alpha platform had been used since the late 1980s, and he was able to sell an overhaul on two fronts. The main selling point was risk. “The old systems were becoming difficult, if not impossible, to support,” he recalled, “and there was a continuing and ongoing risk that one day they would break and not recover.”
Secondly, and in hindsight more important than Melbye thought at the time, was the inability of old systems to provide the kinds of functionality that user communities were asking for. For example, when the district wanted to provide real-time reporting on a Web page, the old software simply was incapable of performing that function. Installing new software on a new platform was necessary to provide that kind of functionality.
“There was case after case of things like that coming up, where we simply had to go back to the users and say, `No, we can’t do that on the current version of the software,'” Melbye recounted.
With those two justifications, the district’s IT team was able to overcome the cost question – it would eventually cost $4 million to complete the phased project – and cost always is a concern in the public sector. “You want to make sure you are getting value for your dollar, and we could say, `We’re not only getting value in eliminating and managing some of this risk, we’re getting a lot of value in being able to provide the kinds of functionality that we need to.'”
Going through a phase
From the onset, it was apparent the project would have to be done in phases. Along with ancillary systems, the district was looking to change systems that supported the core of the organization, so it would have been foolhardy to do everything at once. Melbye and his cohorts wrote a plan to migrate all 23 applications, and then broke it up into “doable chunks,” identifying which pieces to tackle first, second, third, and so forth.
Each phase was budgeted individually, and approved by the sewerage district commission on a phase-by-phase basis, not in one large and indigestible piece.
Melbye worked with division directors to prioritize those applications. The core financial functions were done first, followed by human resources and payroll, systems monitoring, and pre-treatment billing, so even the directors whose areas were down the list could see their time was coming. As a result, Melbye achieved buy-in from the directors.
There also was strong alignment with organizational objectives, but it took some work. To glean those objectives, and gain some perspective on departmental performance measures, Melbye formed an IT Steering Committee comprised of business unit leaders. He could then identify the gaps in the system’s ability to deliver on those performance measures.
“The dialogue,” Melbye noted, “was started early on to say, `Here is where we are, and here is where we need to be, and how are we going to get there?'”
The formal structure of the IT Steering Committee, where each phase of the project was monitored, was supplemented with one-on-one meetings with individual project sponsors – the comptroller for example, during the core financial phase. MMSD Executive Director Kevin Shafer changed the district’s organizational chart so that Melbye reported directly to him, and their meetings focused on organizational alignment.
Achieving buy-in from directors was much easier than bringing mid-managers on board. Their emotional attachment to previous systems put a wrench in the works because their tendency was to lean on old, familiar ways, and the lack of change management is one of two things Melbye would change if he could start the project over again.
First, he would have enlisted business unit leaders to help manage the expectations of their user groups. “One thing I would do differently is ask the business unit leaders to help send a message to their individual departments that, `Hey, things are going to change,'” Melbye said. “‘There is going to be new software, there is going to be new tools, and you’ll be able to do a lot more, but you need to help make that happen.'”
The second thing Melbye would do differently is target that mid-manager level with more dedicated training and more dedicated lines of communication from the CIO to continually reinforce the message that the old systems are going away, and it’s for a good reason. That mid-level acceptance has since been achieved, but at the time of the conversion, Melbye acknowledged that more needed to be done in the way of change management.
In all cases, contracts with vendors were performance-driven so at any point in time the district could have extricated itself from either a product or a service contract, and change horses in mid-stream. The focus was on deliverables, and vendors caught on to that very quickly, hitting their targets. The Lawson core financial module, for example, was up and running in seven months, and Melbye attributes satisfactory vendor performance to getting away from what he called the “hours times rates equals bill” mentality.
“The way I address vendors is that I build performance-based contracts where I wasn’t so much worried about hours and materials and stuff like that,” he said. “What I had were milestones with concrete deliverables attached to them, and if the deliverables were not hit, if the milestones were not hit, then that is what I focused on.”
The pre-treatment billing phase took 14 months to complete, the longest of any phase, and the project has moved on to the shut down phase for the old Alpha Dek system. Aside from improved functionality, the most significant benefit may be the transition from old paper forms to electronic purchasing, which has reduced procurement cycles to, in some cases, the same day.
This was by far the most comprehensive technology overhaul Melbye has been involved with. Just about all of the district’s 250 employees use technology systems to some extent, if nothing else to get their paychecks, which now are delivered online. Given all that transpired during the wall-to-wall project, minor brush fires and all, Melbye has no regrets about making the transition to information technology.
“But,” he added, “there were days.”