One on One with BCG's Scott Hefter

Scott Hefter “Effective” and “government” are rarely words uttered in the same breath, especially these days. So needless to say, making government work better is a big business. It’s why BCG has hired operations expert Scott Hefter as a Partner. Hefter will draw upon his extensive government insider knowledge to help the firm beef up its U.S. public sector practice. Hefter joins BCG from PWC, where he led both its U.S. management-consulting practice and its global-analytics business. Prior to that, he was CEO of PRTM, a global management consulting firm specializing in operational and IT strategy that PwC acquired in 2011. Hefter sat down with Consulting to discuss his new role and his plans for growing the practice.

Consulting: New role, new company, what’s been keeping you busiest so far?

Hefter: My role here is to help build our public sector practice, both in the U.S. but also be part of the global team. On one level many things are the same, but on another, there’s a lot of things that are different. So there was a little bit of immersion into BCG and really understanding the breadth of the experience and the talent and then working to tune all of that to be appropriate for a public sector marketplace. It’s not starting from ground zero or from nothing, we actually have a fairly significant practice around the globe and in the U.S., but particularly in the U.S. not nearly as pervasive as I think we can be. I think of it as we’re sort of a well-funded startup; a lot of great past performances and experiences but there’s also a lot to do to make it a much more enduring practice for federal.

Consulting: Sounds like growth is big on the agenda. What are some of the biggest potential growth areas for the practice?

Hefter: It’s all about growth. Public sector was one of the fastest-growing industry practices last year. There’s a few big themes: one is a significant move toward private industry, public sector and social sector needing to work much more closely to solve today’s biggest global issues. When we look at things the world needs, they need people and capabilities that transcend both public and private sector. If I take healthcare as an example, between the ACA, what’s going on with veterans’ health, and you factor in what’s happening from a demographic shift in terms of an aging population, urbanization and emerging technologies, the answer to those really straddles public, private and social. I see BCG in a position with significant footprint in all three areas helping figure out what operating models are needed to be able to work across those boundaries.

The second one is you almost can’t go to a meeting, no matter what the topic, without getting into mobile data and analytics. When you think about it from a public sector perspective, it boils down to two thematic use cases, one around civic engagement and one around discovery. Civic engagement: how do you drive efficiencies on how call centers interface with civilians and citizens? You’re also talking engagement on more of a b2b level in terms of the regulators, how the SEC, EPA, FDA, etc. interface with the entities they’re involved with. The other would be discovery. There are large sets of data, not even the obvious places like DoD or NSA, but if you think about the data repositories that sit in places like the VA and Federal Reserve, How do you use analytics and big data and the algorithms to discover insights from all of that medical and financial information to promote better citizen health and national well-being? I think we’ve just been able to begin to begin to tap that.

Consulting: What are government leaders most eager to talk about?

Hefter: A big scene both in the U.S. and globally is around government agencies having mission changes. Whether the changes are brought about by a regulatory environment change or some of the megatrends I mentioned earlier regarding demographics. Increasingly governments are being resource-constrained, so how do you deal with the new mandate or mission or expanded role but in an efficient way? It’s got really pervasive implications on the organization, different types of talent different types of technology. A great example would be the regulators. Their roles have significantly changed, they have a need to engage more proactively and deeply with the entities they’re regulating. But that means there are different engagement models and they’ll have to engage in new ways. I think folks are struggling with what that means and how you do it in a timely and efficient manner.

Consulting: What are clients demanding?

Hefter: Advice and perspective. I think if the problems are evolving and you’ve been talking to the same people, you need to bring additional voices into the conversation. That’s an advantage for BCG, we have a presence, but we are, on a relative basis, new to the conversation, but extremely qualified and relevant. For example, cost cutting is on everyone’s mind. One of BCG’s clear strengths is our design, de-layering, talent development, leadership development. How do you connect those dots? I use DoD and their 20 percent cost reduction targets as an example. A lot of those targets have been met through letting the natural attrition occur and not replacing. That’s very logical, but what you wind up getting is not a strategically designed organization. You wind up with holes where it just happens as opposed to being thoughtful. You bundle that with big government workforce that’s aging, the question becomes, is there a way to take another look at it and put a strategic design in place and drive to a better answer over a long period of time and do it in a way that’s implementable within a federal environment? That’s a real problem and a real opportunity.

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