El Paso County, Colorado, which has the second highest caseload in the state, has attained greater efficiency in child support enforcement by outsourcing to a provider who runs the program as a business. Thanks to offering performance awards to staff, customers are receiving higher service. An industry trade group noticed and awarded El Paso County its 2005 Most Improved Award, deeming it one of the best in the West.
Outsourcing Drives Change
Established in 1861, El Paso County has an estimated 2004 population of 554,574. It runs from Pikes Peak on the west to the Platte River on the east, encompassing over 2,000 square miles.
In the mid-nineties, El Paso County was dissatisfied with its child support enforcement and began to investigate outsourcing as a solution to inject change and enhance performance. It contacted Policy Studies Inc. (PSI) of Denver, Colorado, a consultancy firm specializing in child support enforcement for the public sector.
Representatives of El Paso County met with Mike Henry, now Senior Vice President of child support operations for PSI. El Paso County had become aware of early successes with outsourcing child support enforcement in Virginia, where Henry had spent seventeen years with the state in child support enforcement management.
Henry pointed out that outsourcing brings enhanced speed and accountability to the process while avoiding the inherent trappings of bureaucracy. “The public sector tends to have large procurement processes that take a long time. If a fax machine breaks, the private sector can just send somebody out to buy one, where in the public sector it could take weeks.”
Accountability is a major driver. It is far easier for the public sector to establish performance standards for an outsource provider than to try to impose change within the organization.
“Companies may be able to avoid some internal red tape that may ensue between government agencies. Private sector entities can also more easily make tough decisions without the fear of media scrutiny and the same political backlash that face government employees,” says James Krouse, Manager, State and Local Analysis for INPUT Inc., a market research firm headquartered in Reston, Virginia.
El Paso County outsourced in 1996. But Toni Herman, Contract Services Manager for El Paso County, notes that there were shortcomings in reaching the objective “to make El Paso’s child support enforcement program highly responsive to customers’ needs.”
Involving and Empowering Staff
PSI, now a provider of managed child support enforcement services, submitted a proposal when the contract came up for bid again in 2000. The strategy was to completely reorganize the staff duties, inject accountability with incentives, and increase IT functionality on the front end to expedite customer service.
When PSI won the contract and took over in January 2001, transforming the roles of the staff became the first priority, recalls Henry. “Office reorganization included all staff providing customer service to get closer to the clients and address shortcomings.”
Motivation comes in the form of bonuses through performance-based incentives. The standards are percentages. To motivate staff, PSI uses a monthly bonus system, not only for individuals but also as a team, with standards that staff can easily understand.
As a result of performance-based bonuses, staff becomes stakeholders with a vested interest in the outcome, notes Henry. “The staff wants management to hold under-performing individuals accountable for jeopardizing team bonuses,” he says.
PSI supplements the state mainframe systems with a customer service application on the front end that pulls data out of up to 20 screens on the statewide computer system. Information is displayed in tables, accessed by clicking on tabs in a user-friendly interface, to allow customer service representatives to find the information more quickly to serve clients.
Custom reporting programs allow staff to organize and prioritize workloads, explains Henry. “State mainframes are very good at automated activity without human intervention such as intercepting a tax return. But without ad hoc query capabilities in a batch mode, customer service representatives would have to find certain types of cases one at a time.”
Achieving Excellence Through Outsourcing
The performance figures speak for themselves. The percentage of child support cases with established court orders climbed from 77.3 percent in 2002 to 85.2 percent in 2004, while total collections for El Paso County families and children increased 26.5 percent, from $25,775,648 in 2002 to $32,611,829 in 2004.
“Our five-year partnership with PSI has been extremely successful,” notes Herman. “In working with PSI, we’ve been able to create a program that exemplifies what outsourced child support operations can achieve.”
The Western Interstate Child Support Enforcement Council (WICSEC), a nonprofit alliance serving child support enforcement professionals from Western states, recognized El Paso County with its 2005 Most Improved Program Award. The criteria used to determine the award was based on a comparison of performance numbers on key measures during the previous three federal fiscal years: 2002-2004.
Krouse adds the private sector “has entrenched experience operating in specialized areas like judicial processing.”
The public sector has become more sophisticated in recent years by establishing clear performance standards, according to Henry. “Accountability is a major factor in bringing in a supplier who is going to concentrate on giving you what you want.”
Herman is delighted. “The program is now recognized as one of the best in the west. We’re happy with the results of the partnership, but the true beneficiaries are the families and children in El Paso County.”
Lessons from the Outsourcing Journal:
- Outsourcing to PSI has elevated El Paso County to be recognized as one of the best in the west in child support enforcement.
- Outsourcing enables accountability in the public sector and potential rewards for staff.
- Outsourcing alleviates public sector stagnation through reduced political interference and bureaucracy.
- Outsourcing has enhanced the agility of customer service and organization of caseloads.
About the Author: Ben Trowbridge is an accomplished Outsourcing Consultant with extensive experience in outsourcing and managed services. As a former EY Partner and CEO of Alsbridge, he built successful practices in Transformational Outsourcing, Managed services provider, strategic sourcing, BPO, Cybersecurity Managed Services, and IT Outsourcing. Throughout his career, Ben has advised a broad range of clients on outsourcing and global business services strategy and transactions. As the current CEO of the Outsourcing Center, he provides invaluable insights and guidance to buyers and managed services executives. Contact him at [email protected].