Moments of Pain and Glory: Richard Arbuthnot, Executive Director, NASA Shared Services Center

NASA Shared Services Center (NSSC) won the award for ‘Best New Captive Services Delivery.’ Richard Arbutnot, Executive Director of the center, led a team who fought against the odds to implement NASA’s Center on the Gulf Coast in the wake of the nation’s worst ever national disaster – Hurricane Katrina in January 2005.

Before the center was established, Rick managed the largest public-private procurement competition in the agency’s history, before consolidating over 50 agency-wide administrative activities from 10 geographically dispersed field centers, including human resources, procurement, financial management and IT. Rick now manages the 500-person organization in Mississippi.

SSON: NASA had planned to begin operations at the Shared Service Center in Mississippi the week Hurricane Katrina hit, how much of a blow was this to the centers start-up? 

Richard Arbuthnot: We were shooting to open the doors of the Shared Service Center on October 1st 2004, starting with a few small services. We were in Mississippi for four days, when on Friday, August 26th before I went home to Orlando for the  weekend, my facilities person mentioned there was a storm out on the Gulf, but I didn’t think it was going to affect us. It turned out to be the beginning of hurricane Katrina.

By Monday August 29th it was the worst natural disaster in the history of the United States. I had to pull my team back up to Washington D.C where we had been managing the projects before moving to Mississippi. Several people remained stranded and hadn’t made it home that weekend. But, I was tasked by the administrator to come up with the way forward, on how NASA could continue the commitment to the state of Mississippi.By mid-September we agreed there was poor infrastructure and no housing available, but we planned to get back to Mississippi for January 2006. So I brought a team of about twenty five people down here in January, and we opened up in March. But it was very difficult because I had people commuting 100 miles out of hotel rooms and I was living in a trailer on site, out by one of the rivers along with three or four more.

SSON: Did the disaster give you incentive to employ staff for the center from the local area to give something back to the region?

RA: Absolutely, and just so you know about the staffing strategy; we are a public private partnership. I knew we had about 150 civil servant jobs and approximately 350 service provider jobs, which could be filled by the local community. I went through position by position and decided that I needed about 50 people to join from other NASA centers for various positions where I knew I needed to have NASA expertise. I also knew that I needed people with federal experience, but it didn’t necessarily have to be NASA people, as long as they were from another government agency. Then I had a few positions on the government side where I just needed functional expertise either in financial management, procurement, IT or human resources.

In November 2005, a couple of months after Katrina, we held a job fair in Mississippi. I can tell you about 2000 people turned up. From a public service standpoint, that day will probably stand out in my memory as the most gratifying day that I have ever had as a civil servant. To look at people who were so proud that NASA was honoring its commitment to the state of Mississippi, and that we were offering jobs and trying to help them rebuild after hurricane Katrina. I am happy to say we hired a lot of those people that day, and I still have them with the NSSC.

SSON: While on the journey of planning and implementing the NASA Shared Service Center, you were faced with many obstacles including the aftermath of hurricane Katrina, were there times when you felt like throwing in the towel?

RA: Yeah I guess there are two particular times that stand out. Number one is when we first started talking about developing the center back in 2001 to 2003. We had to go through the public private competition which took 90 days to pull off. We finally got through the selection maze, and all of a sudden we got a new NASA administrator. I heard that he wasn’t all that excited about Shared Services, because there were detractors telling him that this was not a good thing for the agency to be doing. I really felt like ‘gee whiz’ we have come this far and now we need to try and convince a new administrator that we’re on the right track and that he’s got to stick with us on this.

The second time was actually after hurricane Katrina, when we came down here, and I was trying to recruit other NASA people from other NASA centers to try and come to South Mississippi to the worst natural disaster in the history of the United States. I knew that I needed about 50 people from other NASA centers and I was trying to incentivize it, as there was no housing available and the area was in shambles. It was very difficult to fill in some of the key roles; I had to announce positions, go back to re-announce and restructure some positions to get the right people. I was really wondering whether I was going to get the people that I needed to help me pull this off.

SSON: How did you finally manage to convince people to come to the most torn State in the US?

RA: Well first I just tried to convince them it was the right thing to do for NASA, and I believed in the model. It was going to be more efficient and we could free up some cost avoidances for the agencies and therefore redirect resources from the mission support side from NASA and directly support the mission for space exploration.
I tried to convince them that the work was going to be exciting, because we were starting up and building something from scratch. I admitted it was going to be the hardest thing that any of them would face, but instilled the belief that when they retire from public service, this will be their crowning achievement.
We also incentivized heavily and offered some promotions. We gave recruitment and relocation bonuses where appropriate, and I tried to sell people on the public service fact of being part of rebuilding the Gulf Coast, and that it was the right thing to do from a humanitarian standpoint.

SSON: When did you feel that you had come full circle and it was worth all the sweat and tears?

RA: It all came together last November - December; that’s when I realized it was really working and operating as planned. I could see that our financials were doing very well and that we were going to exceed our return on our investment, as far as when we were going to be able to pay off the NSSC, the original projections aid. We anticipated that it would take about three years and five months to pay it off, but we actually did it in three years and two months.

In our annual savings the original projection from the implementation report was six to eight million dollars a year, right now we are at twelve to sixteen million dollars a year. At the end of 2008 when I got the financials, I realized we had got cost avoidance of $15 million for NASA. At that point in time, I could see that we were clearly exceeding the cost projection. I looked and thought we are really doing this, having transitioned everything into the center, while actually stabilizing our services, our customer satisfaction scores and our service level indicators.

SSON: Why do you think you have been so successful in achieving such a high return in investment prematurely?

RA: To be honest with you I can’t take credit for this personally. I am very fortunate to have such a strong leadership team helping me. I think without question it is the quality of the team that we have been able to recruit here, and I think that is both in the civil service side as well as with our partners with the Computer Science Corporation. We really put a lot of time and effort into bringing in a top notch management team. And the people on the ground doing the work for the NSSC paid off, because the strength of this organization is in the diversity and about the group of people that we have brought in.

I am not just talking about race and gender. I am talking about bringing people in from the ten centers of NASA. This is important, because it helps us to learn from the different cultures out there in the different centers, and what as far as our operating procedures will play well with the centers and what won’t? Combining that with bringing in people from other government agencies who have Shared Services experience, has been very successful. And our employees from private organizations bring unique perspectives on how to accomplish the work. I am absolutely convinced that people’s backgrounds, how they make decisions, and their life experiences help make us such a good organization.

SSON: What advice would you give to other Shared Service Centers that are starting up?

I think you just have to be persistent and consistent. Evaluate Shared Services as a valid cost cutting business strategy for the organization at large, and try to stay consistent with that message and show people the benefits of it. There are going to be good days and bad days. Just because you have a bad day you can’t throw in the towel. The other thing is to surround yourself with some key officials and a strong management team, that can help guide you through this. You need people that are talented in the financial arena who can help you with the budget and chargeback’s. You have got to have people in the operations world that understand the facilities and infrastructure and others that understand resources. You have got to have people that are versed in industry internal controls who are going to manage internal controls within your organization. And finally you need people that are well versed in performance and risk.

SSON: What was the best mistake you made that taught you a valuable lesson?

RA: We had several lesson learnt, and if had known then what I know now, I would have done some things differently. One thing that comes to mind is electronic document management (EDM). Initially I thought that we were setting up an infrastructure that would be able to handle all of the documents that we were going to manage for NASA, but we weren’t prepared and we struggled with it after we started to get everything in here. For the first couple of years I didn’t have any of the big activities in the center. I had quite a bit of stuff, such as accounts payable, accounts receivable, personal action processing and benefits counseling, but not the highest volume of activities. Last summer was when I finally got everything in here; we struggled for a couple of months, just because we were not prepared. We have since put in place processes and procedures and we are doing much better with that. But we still do not have an end to end EDM system and if I had to do it all over again I would probably have implemented one from the beginning.

SSON: What legacy would you like to leave if you were to leave your current role there? 

RA: I just want to build a strong, deep organization, that regardless of who is here as the Executive Director, can survive and build that culture of customer service, while trying to save the agency money. And if you have that ingrained in your culture, you’ll be able to survive anything. That is what we’re in the process of doing right now. Strong commitment, unparalleled service and actually saving the agency money from the business support side of NASA to directly supporting our vision for space exploration.