Creating Efficiencies in Goverment

How can state agencies benefit from private business?
By James Jeffrey, Capitol Correspondent

Texas state agencies may soon be able to hire successful businesspeople for an entrepreneur-in-residence program.

State Rep. Larry Gonzales, R-Round Rock, has already introduced House Bill 664, and State Sen. John Carona plans to file a bill in early February.

Carona, R-Dallas, aims to achieve a win for the public and private sectors by improving how government listens to and learns from the business community. The initiative was inspired by Dell Inc. executives.

“An ongoing challenge in state government is making sure it stays modern and relevant,” Carona said. “This bill would allow the state to tap the resources of the real world and could prove invaluable to Texas’ interests.”

Carona’s half-page bill cuts straight to the point, said Steven Polunsky, director of the Senate Committee on Business and Commerce.

It proposes that a state agency can use available funds to hire an entrepreneur who can:

• Improve outreach by state government to the private sector

•Strengthen coordination and interaction between state government and the private sector

•Facilitate the understanding and use of technological advances to make state government more transparent and interactive

•Implement best private-sector practices to make state government programs simpler, easier to access, more efficient and more responsive to users

Carona said he appreciates the impact a stout business mind can bring to the public sector due to his role as chairman of the Senate Business and Commerce Committee and a businessman for more than 34 years.

Finding the right resident

“I love how legislators are discussing ideas such as this,” said Gary Hoover. He’s the entrepreneur-in-residence at the University of Texas’ School of Information, and used to hold the same title at UT’s McCombs School of Business. “However, it’s not clear why they’ve titled it entrepreneur-in-residence.”

Entrepreneurs are inherently mavericks not given to structure and not necessarily the best people to opine on private-sector practices, he said.

Most of the tasks listed in the bill are not in the sweet spot for entrepreneurs, but rather are better suited for talented managers.

But hiring a management consultant would smack of only trying to look good, said Ingrid Vanderveldt, Dell’s entrepreneur-in-residence since September 2011.

Having an entrepreneur is fundamentally important to send a clear message to the business community about the state’s genuine intention to collaborate with, learn from and understand growing businesses’ needs.

What it will cost

State agencies have the capacity to pay executive-level wages — and that’ll likely be needed to recruit adequate talent, Carona said.

The hope is that a CEO-type who commands high pay will create efficiencies that would more than offset his or her salary. And there’s always the hope of free help. It’s not unheard of for a successful entrepreneur to take on such a role as part of a sabbatical or out of civic duty.

State agencies involved in economic development are likely to want an entrepreneur-in-residence to gain access to private sector resources, technology and intellectual capital to augment a tight budget, said Craig Casselberry, CEO of consulting company Quorum Public Affairs Inc. in Austin.

Entrepreneurs-in-residence should be excluded from agencies’ decision-making processes when contracting to companies for which they previously worked to avoid conflicts of interests, he said.

Venture capital firms started the entrepreneur-in-residence model to nurture a successful company and then invest in the new venture at the end of the entrepreneur-in-residence’s term.

Fortune 50 companies habitually employ entrepreneurs-in-residence.

Carona said he’s very confident his bill will pass because it doesn’t represent a threat to any group and seeks to provide a helping hand.

“This program allows greater progress at a cost we can afford,” Carona said.

(Dallas Business Journal, 2/3/2013)

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