Hoecker Defends FERC First Progress
Reports that the year-old 'FERC First' effort is in disarray due
to clashes between contracted consulting firms over how to revamp
the agency are completely unfounded, said Chairman James J. Hoecker
Critics contend that Andersen Consulting and James Martin &
Co., the two consulting firms contracted to carry out the effort,
have been at odds with each other over how to restructure and
redesign the Commission's operations, as well as with the internal
FERC staff teams that have been assigned to assist them. This not
only has caused disruptions to the overall project, but has
aggravated staff anxiety and dissension beyond that which would
normally attend such a sweeping restructuring, some sources said.
Hoecker flatly dismissed reports of discord between the
consulting firms. "I'm finding that James Martin and Anderson can
agree for the most part. And the fact that you have two firms like
this working on the same project is very common...I think that if
anybody thinks there's a battle going on, they just don't
understand." Anderson was the sole consultant on the initial phase
of the project. However, sources said James Martin & Co. of
Fairfax, VA, entered the picture when it significantly underbid
Anderson for the following phase of the restructuring effort. Both
companies are now at FERC, focusing on different areas of the
Hoecker noted that Andersen and James Martin have their
"strengths and weaknesses" like most companies, which necessitated
the use of the two firms. Andersen has a "very strong" project
management capability that is critical to the Phase II
implementation aspect of the FERC First program now taking place.
On the other hand, James Martin's strength is in "information
technology," he said, adding that it's doing a "terrific job" in
this area. About $4 million of the $7 million earmarked for FERC
restructuring has been budgeted for IT.
"I'm real pleased with the way it's going. To some people this
[use of two consultants] may look like a lack of confidence in the
process or a lack of confidence in the consultants, but I can
assure you that's not the case," Hoecker said. "We are most
concerned about meeting our deadline and getting the [FERC staff
involved] in FERC First back to their regular jobs and keeping our
costs contained. We think that this is a good move and we're on the
way to doing all of those things."
Hoecker is hoping to have the agency completely revamped by
March 2000. Phase I of the FERC First project, which entailed
mapping out the general strategy for restructuring the agency, was
completed at the end of last June, he said. The Commission is now
into the final Phase II implementation, which includes process
designs and developing organizational structures for new offices.
The FERC chairman defended the cost-benefit aspect of the
reorganization "This is, as these things go, not very
expensive...The return to the regulated industries and American
taxpayers will be enormous in terms of benefits. Believe me, if I
thought this were a waste of money, I wouldn't be spending it," he
told NGI in an interview.
He further disagreed with critics who insist the restructuring
of the agency should have been handled internally. This is "a very
difficult process and you need experts to help you do it. There are
a lot of administrators who think that they can simply wave their
hand and the bureaucracy will change as a result of their wishes.
Well it's a lot more complicated than that," Hoecker said.
"What we're trying to do is something that is successful
scientifically in terms of how offices are going to operate and
something that will be permanent in terms of changing the way FERC
operates" in the future, he said.
As part of the FERC First effort, the Commission so far has
announced the start-up of three new offices - the Office of
Strategy and Organizational Management, Office of Finance,
Accounting and Operations, and the FERC First Project Office. The
initial two offices contain parts of what was formerly the Office
of Executive Director and Chief Financial Officer as well as other
functions. FERC also is expected to announce, among other things,
the creation of the Office of Administrative Litigation during the
first half of this year. This office would house the attorneys and
technical staff who are involved in trials before administrative
The Office of Strategy focuses on strategic planning performance
assessment and is responsible for human resources and leadership
development. The Office of Finance's functions include budget
funding, internal accounting operations, internal and external
accounting policy and other finance-related activities. The FERC
First Office is in charge of phasing in the agency's restructuring
and will be disbanded when the process is completed in early 2000.