The Department of Veterans Affairs (VA) has long functioned as if it were three distinct business entities—health care, benefits and cemeteries—and never fully integrated its financial management, acquisition, human resources, capital investment and technology functions across the organization.
With a mandate for change from the VA’s top leadership, W. Todd Grams has led two major transformational management initiatives designed to create a coherent and unified department, streamline access points for VA beneficiaries, reduce costs per beneficiary, and ultimately deliver better care to more veterans.
During fiscal 2010, Grams, the VA’s acting assistant secretary for management and chief financial officer, established a new integrated management governance structure for the VA’s business functions, including financial, personnel, procurement and information technology. This involved the updating of 140 policies, creation of a streamlined hiring process for acquisition personnel, implementation of a self-service employee benefit portal and training 2,375 employees in financial management.
Grams and his leadership team also successfully led the effort for the first time to combine all of the department’s investment planning efforts involving construction, leasing and non-recurring maintenance—a portfolio accounting for nearly $100 billion. For decades, planning and investment decisions for VA capital infrastructure took place in stovepipes, at times resulting in duplicative efforts and poor use of taxpayer dollars.
Additionally, Grams led his team through an in-depth analysis of VA’s financial management priorities. This review stopped a $500 million financial systems overhaul in its initial stages and redirected funding from this high-risk venture into new programs that will generate greater benefit at significantly lower cost. The changes have dramatically improved controls over a $14 billion purchasing program.
“VA essentially operated as three companies with a thin layer of central management. What Todd has done is one of the more meaningful efforts to create a one VA environment,” said Jonah Czerwinski, senior advisor to VA Secretary Eric Shinseki.
Grams’ colleagues said that in a year and a half, he implemented systems that unified decision-making and established clear priorities across the department. This has allowed the VA to spend its available money more wisely, reducing unnecessary costs in some areas and using the freed up funds to improve others services and programs.
In addition, rather than just knowing what is spent, the VA now is able to identify true costs and budget appropriately, avoiding problems that previously plagued the department.
“In the past, capital infrastructure had been diffuse and disconnected from out-year costs. We were literally signing up for major construction that didn’t account for costs to complete work,” said Czerwinski. “For example, the Veterans Health Administration (VHA) may have opened a hospital, but the budget didn’t include activation costs, such as the machines needed to assess patients. Now we’re making that an unavoidable calculation.”
W. Scott Gould, the VA’s deputy secretary, said the integration of VA’s business functions brought the “subcomponents back to the center as one VA instead of many.” He said the systems instituted by Grams “allow us to look at all the resources in terms of funding, capital infrastructure and needs of veterans, and optimize funds toward that end.”
“Management of large organizations underpins the ability to achieve mission,” said Gould. “It has a profound impact on quality and performance.”
Grams said his long experience in government, which has included an earlier stint at the VHA, as well as jobs at the Census Bureau, the Internal Revenue Service and the Office of Management and Budget, taught him about the insularity of bureaucracies. He said the integrated management system he put in place “causes us to look across stovepipes and find opportunities to work across the team.”
John Gingrich, the chief of staff to the VA secretary, said Grams has been successful in overcoming barriers and bringing about change because he is “people-centric, results oriented and forward looking.”
“He finds a better way to do things and gives staff a sense of purpose and direction. They know they have a leader that cares about them,” said Gingrich.
Since assuming his job in November 2009, Grams also has taken a number of steps to improve the operations of the VA’s Office of Management. He established clear financial management goals, a program management system to ensure focus and accountability, stepped up employee training, instituted town hall meetings and developed a telework program.
Danny Werfel, the controller at the Office of Management and Budget, said Grams’ efforts at the VA should serve as a model for other departments.
“Todd is a problem solver and able to seal the deal to get things moving,” said Werfel. “He’s a good symbol for a better government.”