STRATEGIC PLANNING MEETING AND BREAKOUT SESSIONS Phil Engelhardt Report from Breakout Session on Technology and Economic Development Interestingly enough to have us last as the responder, I think, fits very well with the nature of the discussion that we had. We went through a very fine expose that Jim Geringer has actually a lot of experience in giving, and that is looking at the impact on technology in a lot of areas of government. I’d encourage as many of you as can to be in touch with Jim, one on one, or try taking a look at the information. We find it to be extremely enlightening. At the end of the day, it came down to trying to evaluate what progress the government has made today in using technology to try to affect the cost of delivering the services, the innovations in the type of services it can deliver. But one of the most crucial statistics was, how deep is the penetration? How impactful can this really be? What are the constraints? And I think a lot of that just goes to how many homes and citizens, in fact, are reachable through technology and technology-based initiatives today? One of the measures of success of innovative products, for example, in Silicon Valley might be time to a million users. So a pager, when introduced in the 70s, took 14 years to reach a million users and iPod only needed six months to reach a million users today. Netscape when it was released online in 1995, only needed 14 seconds to reach a million users. Jim had some very interesting slides on what the penetration was in term of households and that’s huge. If the government wants to be effective it has to put policies in place that touch as many of its constituents as possible. So in evaluating those areas and seeing which were those where government actually had the broadest reach and really changed the lives of its beneficiaries, we found that the four key areas were education, healthcare, public safety, and family services. But by more than a 2-to-1 margin, education and healthcare were really the biggest areas in which government can use technology to change the quantity, quality, and the impact of services delivered to its constituents. That led us to a practical perspective to look at the mission of the Institute and the way we had carved up the discussions for the day, and the assignment of trying to come forward with a number of practical approaches for the Institute to deliver a message on. We thought that we’d be better off combining the efforts of the economic policy and technology impact team with those of the healthcare and education groups and ultimately ended up splitting up and joining the other two discussion groups, because we felt that as separate track, if you were uniquely trying to push technology for technology’s sake in the discussion and how government will evolve, it’s really just a self-evident truth. Technology is touching virtually all parts of our lives and virtually every style of business and industry. Say perhaps, the dry cleaning industry which may end up digitizing sometime soon. But for the most part, we really took a look at it as technology being a firm undertaking of almost any new initiative in any effort to try to change the lives of its constituents. So, how to quantify what we might be able to do as the Oquirrh Institute, as relates to these two broad areas? In joining the discussion, I’ll let Jim make a comment on what we heard specifically that impacted us on the education side. Governor Sundquist and I sat in on the healthcare group hearing some of the comments made by Jim Souby. But we feel that, number 1) traditionally many of the projects that are affected by technology and this is the experience that we’ve had with the Western Governors Association and other groups as well, by admitting the technology companies as co-sponsors, you start to taint the impact of what you are trying to accomplish. We heard that in the report from the education sector as well. You have to be very cautious of how you go about framing the participation of those that really have a stake. Yet, you need their help if you are going to try to put a practical project into place because the cost of deploying the technology for the purpose of the program is extremely expensive. So, reaching out to those foundations that are deeply engaged in education and healthcare would be a primary way for the institute to start to lay out some of these ideas. And ultimately if we came up with a firm set of guidelines for a trial program, at that point we might want to engage some of the private sector companies once the broad outlines have been determined. I think that pretty much gives you a short answer to how we felt that we would look at the use of technology and policies. Jim, you might want to add a few words specifically as it relates to the education space. Jim Geringer: The other group did quite well. What I can offer for both healthcare and education is the impact of information and how it can guide our choices in a more timely way. The increasing, almost runaway cost of healthcare has dominated many state budgets. Since those are the two main drivers of the budgets of the states, what can we do to increase the benefit while either holding the cost constant or decreasing the cost? Technology plays a significant role in gathering information, allows us to make near real-time corrections rather than waiting for long periods of time. Certainly true in education, where instead of measuring progress every semester, every year or whatever, why not do it almost on an hourly, if not daily basis, and technology enables that in a way that should and can save the teacher time. But it’s not being effectively used or modeled in our teacher prep institutions. Within healthcare, the discovery of data early on so that we don’t get, for instance, 90,000 deaths a year from hospital-caused infections, is just an illustration of how data can be mined and acted upon. I would emphasize prevention. Dick Lamm’s paper, I think, epitomized much of that same thought—using technology to gather information that leads to decisions that leads to action almost on a real-time basis. We talked mostly about two sides of a major expenditure. We did touch briefly on the revenue side and how dramatically altered the state revenue side is becoming with the changes in the economy. We have not kept pace technologically or conceptually on how states raise their revenues or are either restricted from or allowed to raise their revenues. If all we do is focus on the expenditures side, my forecast is we will have to reduce costs because the current rate of revenue and acquisition is not going to work. States are recovering but its temporary; states are almost all operating at a structural deficit. It’s only worsening, it’s not improving. Technology can play a major role there in terms of how we guide those systems or even determine what ways to finance more government operations.