COVID-

19 and the e-commerce explosion

There’s a good chance that your organization is in the position of needing to do more with less under the strain of staffing constraints and competing initiatives. With fewer resources to work with, you’ll need to be persuasive to get the green light on new enterprise technology initiatives. To do that, you need to present decision makers with well-thought-out and targeted business cases that show your initiative will have impact and will be successful. Yet developing such a business case is no walk in the park. Perhaps because our firm has its roots in New England, we sometimes compare this process to leading a hiking trip into the woods—into the wild. 

Just as in hiking, success in developing a business case for a new initiative boils down to planning, preparation, and applying a few key concepts we’ve learned from our travels. 

Consensus is critical when planning new technology initiatives

Before you can start the hike, everyone has to agree on some fundamentals: 

Who's going? 

Where are we going? 

When do we go and for how long? 

Getting everyone to agree requires clear communication and, yes, even a little salesmanship: “Trust me. The bears aren’t bad this time of year.” The same principle applies in proposing new technology initiatives; making sure everyone has bought into the basic framework of the initiative is critical to success.

Although many hiking trips involve groups of people similar in age, ability, and whereabouts, for your business initiative you need to communicate with diverse groups of colleagues at every level of the organization. Gaining consensus among people who bring a wide variety of skills and perspectives to the project can be complex.

To gain consensus, consider the intended audiences of your message and target the content to what will work for them. It should provide enough information for executive-level stakeholders to quickly understand the initiative and the path forward. It should give people responsible for implementation or who will provide specific skills substantive information to implement the plan. And remember: one of the most common reasons projects struggle to meet their stated objectives (and why some projects never materialize to begin with), is a lack of sponsorship and buy-in. The goal of a business case is to gain buy-in before project initiation, so your sponsors will actively support the project during implementation. 

Set clear goals for your enterprise technology project 

It’s refreshing to take the first steps, to feel that initial sense of freedom as you set off down the trail. Yet few people truly enjoy wandering around aimlessly in the wilderness for an extended period of time. Hikers need goals, like reaching a mountain peak or seeing famous landmarks, or hiking a predetermined number of miles per day. And having a trail guide is key in meeting those goals. 

For a new initiative, clearly define goals and objectives, as well as pain points your organization wishes to address. This is critical to ensuring that the project’s sponsors and implementation team are all on the same page. Identifying specific benefits of completing your initiative can help people keep their “eyes on the prize” when the project feels like an uphill climb.

Timelines provide additional detail and direction—and demonstrate to decision makers that you have considered multiple facets of the project, including any constraints, resource limitations, or scheduling conflicts. Identifying best practices to incorporate throughout the initiative enhances the value of a business case proposition, and positions the organization for success. By leveraging lessons learned on previous projects, and planning for and mitigating risk, the organization will begin to clear the path for a successful endeavor. 

Don’t compromise on the right equipment

Hiking can be an expensive, time-consuming hobby. While the quality of your equipment and the accuracy of your maps are crucial, you can do things with limited resources if you’re careful. Taking the time to research and purchase the right equipment, (like the right hiking boots), keeps your fun expedition from becoming a tortuous slog. 

Similarly, in developing a business case for a new initiative, you need to make sure that you identify the right resources in the right areas. We all live with resource constraints of one sort or another. The process of identifying resources, particularly for funding and staffing the project, will lead to fewer surprises down the path. As many government employees know all too well, it is better to be thorough in the budget planning process than to return to authorizing sources for additional funding while midstream in a project. 

Consider your possible outcomes

You cannot be too singularly focused in the wild; weather conditions change quickly, unexpected opportunities reveal themselves, and being able to adapt quickly is absolutely necessary in order for everyone to come home safely. Sometimes, you should take the trail less traveled, rest in the random lean-to that you and your group stumble upon, or go for a refreshing dip in a lake. By focusing on more than just one single objective, it often leads to more enjoyable, safe, and successful excursions.

This type of outlook is necessary to build a business case for a new initiative. You may need to step back during your initial planning and consider the full impact of the process, including on those outside your organization. For example, you may begin to identify ways in which the initiative could benefit both internal and external stakeholders, and plan to move forward in a slightly new direction. Let’s say you’re building a business case for a new land management and permitting software system. Take time to consider that this system may benefit citizens, contractors, and other organizations that interact with your department. This new perspective can help you strengthen your business case. 

Expect teamwork

A group that doesn’t practice teamwork won’t last long in the wild. In order to facilitate and promote teamwork, it’s important to recognize the skills and contributions of each and every person. Some have a better sense of direction, while some can more easily start campfires. And if you find yourself fortunate enough to be joined by a truly experienced hiker, make sure that you listen to what they have to say.

Doing the hard work to present a business case for a new initiative may feel like a solitary action at times, but it’s not. Most likely, there are other people in your organization who see the value in the initiative. Recognize and utilize their skills in your planning. We also suggest working with an experienced advisor who can leverage best practices and lessons learned from similar projects. Their experience will help you anticipate potential resistance and develop and articulate the mitigation strategies necessary to gain support for your initiative.

If you have thoughts, concerns, or questions, contact our team. We love to discuss the potential and pitfalls of new initiatives, and can help prepare you to head out into the wild. We’d love to hear any parallels with hiking and wilderness adventuring that you have as well. Let us know! 

BerryDunn’s local government consulting team has the experience to lead technology planning initiatives and develop actionable plans that help you think strategically and improve service delivery. We partner with you, maintaining flexibility and open lines of communication to help ensure that your team has the resources it needs.

Our team has broad and deep experience partnering with local government clients across the country to modernize technology-based business transformation projects and the decision-making and planning efforts. Our expertise includes software system assessments/planning/procurement and implementation project management; operational, management, and staffing assessments; information security; cost allocation studies; and data management.  

Read this if your organization is planning on upgrading or replacing an enterprise technology system.

It can be challenging and stressful to plan for technology initiatives, especially those that involve and impact every area of your organization. Common initiatives include software upgrades or replacements for:

• Financial management, such as Enterprise Resource Planning (ERP) systems
• Asset management systems
• Electronic health records (EHR) systems
• Permitting and inspections systems

Though the number of considerations when planning enterprise technology projects can be daunting, the greatest mistake you can make is not planning at all. By addressing just a few key areas, you can avoid some of the most common pitfalls, such as exceeding budget and schedule targets, experiencing scope creep, and losing buy-in among stakeholders. Here are some tips to help you navigate your next project:

Identify your IT project roles and resources

While most organizations understand the importance of identifying project stakeholder groups, it is often an afterthought. Defining these roles at the outset of your project helps you accurately estimate the work effort.

Your stakeholder groups may include:

• An executive sponsor
• A steering committee
• A project manager
• Functional leads
• A technical team

Once you’ve established the necessary roles, you can begin reviewing your organization’s resources to determine the people who will be available to fill them. Planning for resource availability will help you avoid delays, minimize impact to regular business processes, and reduce the likelihood of burnout. But this plan won’t remain static—you can expect to make updates throughout the project.

Establish clear goals and objectives to keep your technology project on track

It’s important that an enterprise technology project has established goals and objectives statements. These statements will help inform decision-making, provide benchmarks for progress, and measure your project’s success. They can then be referenced when key stakeholders have differing perspectives on the direction to take with a pending decision. For example, if the objective of your project is to reduce paper-based processes, you may plan for additional computer workstations and focus technical resources on provisioning them. You’ll also be able to measure your success in the reduction of paper-based tasks.

Estimate your IT project budget accurately

Project funding is hardly ever overlooked, but can be complex with project budgets that are either underestimated or estimated without sufficient rationale to withstand approval processes and subsequent budget analysis. You may find that breaking down estimates to a lower level of detail helps address these challenges. Most technology projects incur costs in three key areas:

• Vendor cost: This could include both one-time software implementation costs as well as recurring costs for maintenance and ongoing support.
• Infrastructure cost: Consider the cost of any investments needed to support your project, such as data center hardware, networking components, or computing devices.
• Supplemental resource cost: Don’t forget to include the cost of any additional resources needed for their specialized knowledge or to simply backfill project staff. This could include contracted resources or the additional cost of existing resources (i.e., overtime).

A good technology project budget also includes a contingency amount. This amount will depend on your organization’s standards, the relative level of confidence in your estimates, and the relative risk.

Anticipate the need for change management

Depending on the project, staff in many areas of your organization will be impacted by some level of change during a technology implementation. External stakeholders, such as vendors and the public, may also be affected. You can effectively manage this change by proactively identifying areas of likely change resistance and creating strategies to address them.

In any technology implementation, you will encounter change resistance you did not predict. Having strategies in place will help you react quickly and effectively. Some proven change management strategies include communicating throughout your project, involving stakeholders to get their buy-in, and helping ensure management has the right amount of information to share with their employees.

Maintain focus and stay flexible as you manage your IT project

Even with the most thought-out planning, unforeseen events and external factors may impact your technology project. Establish mechanisms to regularly and proactively monitor project status so that you can address material risks and issues before their impact to the project grows. Reacting to these items as they arise requires key project stakeholders to be flexible. Key stakeholders must recognize that new information does not necessarily mean previous decisions were made in error, and that it is better to adapt than to stick to the initial direction.

Whether you’re implementing an ERP, an EHR, or enterprise human resources or asset management systems, any enterprise technology project is a massive undertaking, involving significant investment and a coordinated effort with individuals across multiple areas of an organization. Common mistakes can be costly, but having a structured approach to your planning can help avoid pitfalls. Our experienced, objective advisors have worked with public and private organizations across the country to oversee large enterprise projects from inception to successful completion.

Contact our software consulting team with any questions.

In light of the recent cyberattacks in higher education across the US, more and more institutions are finding themselves no longer immune to these activities. Security by obscurity is no longer an effective approach—all  institutions are potential targets. Colleges and universities must take action to ensure processes and documentation are in place to prepare for and respond appropriately to a potential cybersecurity incident.

What are some examples of incidents that managers need to prepare for?

Examples range from external breaches and insider threats to instances of malfeasance or incompetence. Different types of incidents lead to the same types of results—yet you can’t have a broad view of incidents. Managers should work with their teams to create incident response plans that reflect the threats associated with higher education institutions. A handful of general incident response plans isn’t going to cut it.

Managers need to work with their teams to develop a specific incident response plan for each specific type of incident. Why? Well, think of it this way: Your response to a careless employee should be different from your response to a malicious employee, for a whole host of legal reasons. Incident response is not a cookie-cutter process. In fact, it is quite the opposite. This is one of the reasons I highly suggest security teams include staff members outside of IT. When you’re responding to incidents, you want people who can look at a problem or situation from an external perspective, not just a technical or operational perspective within IT. These team members can help answer questions such as, what does the world see when they look at our institution? What institutional information might be valuable to, or targeted by, malicious actors? You’ll get some valuable fresh perspectives.

How short or long should the typical incident response plan be?

I often see good incident response plans no more than three or four pages in length. However, it is important that incident response plans are task oriented, so that it is clear who does what next. And when people follow an incident response plan, they should physically or digitally check off each activity, then record each activity.

What system or software do you recommend for recording incidents and responses?

There are all types of help desk software you can use, including free and open source software. I recommend using help desk software with workflow capabilities, so your team can assign and track tasks.

Any other tips for developing incident response plans?

First, managers should work with, and solicit feedback from across the academic and administrative areas within the institution when developing incident response plans. If you create these documents in a vacuum, they will be useless.

Second, managers and their teams should take their time and develop the most “solid” incident response plans possible. Don’t rush the process. The effectiveness of your incident response plans will be critical in assessing your institution’s ability to survive a breach. Because of this, you should be measuring your response plans through periodic testing, like conducting tabletop exercises.

Third, keep your students and external stakeholders in mind when developing these plans. You want to make sure external communications are consistent, accurate, and within the legal requirements for your institution. The last thing you want is students and stakeholders receiving conflicting messages about the incident. 

Are there any decent incident response plans in the public domain that managers and their teams can adapt for their own purposes?

Yes. My default reference is the National Institute of Standards and Technology (NIST). NIST has many special publications that describe the incident response process, how to develop a solid plan, and how to test your plan.

Should institutions have dedicated incident response teams?

Definitely. Institutions should identify and staff teams using internal resources. Some institutions may want to consider hiring a reputable third party to act as an incident response team. The key with hiring a third party? Don’t wait until an incident occurs! If you wait, you’re going to panic, and make panic-based decisions. Be proactive and hire a third party on retainer.

That said, institutions should consider hiring a third party on an annual basis to review incident response plans and processes. Why? Because every institution can grow complacent, and complacency kills. A third party can help gauge the strengths and weaknesses of your internal incident response teams, and provide suggestions for general or specific training. A third party can also educate your institution about the latest and greatest cyber threats.

Should managers empower their teams to conduct internal “hackathons” in order to test incident response?

Sure! It’s good practice, and it can be a lot of fun for team members. There are a few caveats. First, don’t call it a hackathon. The word can elicit negative or concerned reactions. Call it “active testing” or “continuous improvement exercises.” These activities allow team members to think creatively, and are opportunities for them to boost their cybersecurity knowledge. Second, be prepared for pushback. Some managers worry if team members gain more cybersecurity skills, then they’ll eventually leave the institution for another, higher-paying job. I think you should be committed to the growth of your team members―it’ll only make your institution more secure.

What are some best practices managers should follow when reporting incidents to their leadership?

Keep the update quick, brief, and to the point. Leave all the technical jargon out, and keep everything in an institutional context. This way leadership can grasp the ramifications of the event and understand what matters. Be prepared to outline how you’re responding and what actions leadership can take to support the incident response team and protect the institution. In the last chapter, I mentioned what I call the General Colin Powell method of reporting, and I suggest using that method when informing leadership. Tell them what you know, what you don’t know, what you think, and what you recommend. Have answers, or at least a plan.

How much institution-wide communication should there be about incidents?

That’s a great question, but a tough one to answer. Transparency is good, but it can also unintentionally lead to further incidents. Do you really want to let your whole institution know about an exploitable weakness? Also, employees can spread information about incidents on social media, which can actually lead to the spread of misinformation. If you are in doubt about whether or not to inform the entire institution about an incident, refer to your Legal Department. In general, institution-wide communication should be direct: We’ve had an incident; these are the facts; this is what you are allowed to say on social media; and this is what you’re not allowed to say on social media.

Another great but tough question: When do you tell the public about an incident? For this type of communication, you’re going to need buy-in from various sources: senior leadership, Legal, HR, and your PR team or external PR partners. You have to make sure the public messaging is consistent. Otherwise, citizens and the media will try to poke holes in your official story. And that can lead to even more issues.

What are the key takeaways for higher education leaders?

Here are key takeaways to help higher education leaders prepare for and respond appropriately to cybersecurity incidents:

1. Understand your institution’s current cybersecurity environment. 
   Questions to consider: Do you have Chief Information Security Officer (CISO) and/or a dedicated cybersecurity team at your institution? Have you conducted the appropriate audits and assessments to understand your institution’s vulnerabilities and risks?
2. Ensure you are prepared for cybersecurity incidents. 
   Questions to consider: Do you have a cybersecurity plan with the appropriate response, communication, and recovery plans/processes? Are you practicing your plan by walking through tabletop exercises? Do you have incident response teams?

Higher education continues to face growing threats of cybersecurity attacks – and it’s no longer a matter of if, but when. Leaders can help mitigate the risk to their institutions by proactively planning with incident response plans, communication plans, and table-top exercises. If you need help creating an incident response plan or wish to speak to us regarding preparing for cybersecurity threats, please reach out to us.
 

Read this if you are a City/County Administrator, Building Official, Community Development Director, Planning Director, Development Services Manager or work with customers providing a service for a fee.

Planning and development service fees are, for many municipalities, often discussed but rarely changed. There are a number of reasons you might need to consider or defend your fee structure―complaints from developers, rising costs of operation, and changes in code or process are just a few. 

But when is the right time for a formal review of your service fees? There are several key organizational factors that should prompt an in-depth study of your fees, either internally or with the assistance of an objective advisor. It may be time for an update if:

• You’re considering a new permitting system. New technology may streamline your workflows, simplify processes for your customers, or necessitate changes in your staffing. All of these secondary changes can impact the cost of your services. In addition, if you’re anticipating significant changes to your fee structure or methodology (e.g., moving to full cost recovery), you’ll want to configure your new system to support that going forward.
• You have an enterprise development fund. Development fees are collected to cover the cost of providing a service. The methodology you use to charge fees should be based on defensible formulas that can withstand the scrutiny of your customers and cover the cost to provide the service. In addition, reserve funds should be adequate to ensure your development service is funded through the completion of the project. 
• The regulations in your municipality are changing. Perhaps your organization is moving to a unified or form-based code or making changes to the International Building or Fire Codes. Changes in the process and requirements for development may require a reevaluated fee structure.
• It’s been a while. Even if your organization is not experiencing any significant or sweeping change, small shifts can accumulate over the years, resulting in significant fee adjustments that may be tough for you to implement and for your customers to understand. Periodically reviewing service demand and benchmarking your individual fees against those of neighboring communities can help to avoid sticker shock.

If any of these scenarios sound familiar, you may want to consider a fee review, which may consist of benchmarking against similar jurisdictions. Not sure what level of review your organization needs? Our dedicated government consultants include former planners and community development leaders who have walked in your shoes and can talk through the considerations with you.
 

As the Project Management Body of Knowledge^® (PMBOK^®) explains, organizations fall along a structure and reporting spectrum. On one end of this spectrum are functional organizations, in which people report to their functional managers. (For example, Finance staff report to a Finance director.) On the other end of this spectrum are projectized organizations, in which people report to a project manager. Toward the middle of the spectrum lie hybrid—or matrix—organizations, in which reporting lines are fairly complex; e.g., people may report to both functional managers and project managers. 

Problem: Weak Matrix Medicaid System Vendors

This brings us to weak matrix organizations, in which functional managers have more authority than project managers. Many Medicaid system vendors happen to fall into the weak matrix category, for a number of different reasons. Yet the primary factor is the volume and duration of operational work—such as provider enrollment, claims processing, and member enrollment—that Medicaid system vendors perform once they exit the design, development, and implementation (DDI) phase.

This work spans functional areas, which can muddy the reporting waters. Without strong and clear reporting lines to project managers, project success can be seriously (and negatively) affected if the priorities of the functional leads are not aligned with those of the project. And when a weak matrix Medicaid system vendor enters a multi-vendor environment in which it is tasked with implementing a system that will serve multiple departments and bureaus within a state government, the reporting waters can become even muddier.

Solution: Using a Project Management Office (PMO) Vendor

Conversely, consulting firms that provide Project Management Office (PMO) services to government agencies tend to be strong matrix organizations, in which project managers have more authority over project teams and can quickly reallocate team members to address the myriad of issues that arise on complex, multi-year projects to help ensure project success. PMOs are also typically experienced at creating and running project governance structures and can add significant value in system implementation-related work across government agencies.

Additional benefits of a utilizing a PMO vendor include consistent, centralized reporting across your portfolio of projects and the ability to quickly onboard subject matter expertise to meet program and project needs. 
For more in-depth information on the benefits of using a PMO on state Medicaid projects, stay tuned for my second blog in this series. In the meantime, feel free to send your PMO- or Medicaid-related questions to me. 
 

LIBOR is leaving—is your financial institution ready to make the most of it?

In July 2017, the UK’s Financial Conduct Authority announced the phasing out of the London Interbank Offered Rate, commonly known as LIBOR, by the end of 2021¹. With less than two years to go, US federal regulators are urging financial institutions to start assessing their LIBOR exposure and planning their transition. Here we offer some general impacts of the phasing out, some specific actions your institution can take to prepare, and, finally, background on how we got here (see Background at right).

How will the phase-out impact financial institutions?

The Federal Reserve estimates roughly $200 trillion in LIBOR-indexed notional value transactions in the cash and derivatives market². LIBOR is used to help price a variety of financial services products,  including $3.4 trillion in business loans and $1.3 trillion in consumer loans, as well as derivatives, swaps, and other credit instruments. Even excluding loans and financial instruments set to mature before 2021—estimated by the FDIC at 82% of the above $200 trillion—LIBOR exposure is still significant³.

A financial institution’s ability to lend money is largely dependent on the relative stability of its capital position, or lack thereof. For institutions with a significant amount of LIBOR-indexed assets and liabilities, that means less certainty in expected future cash flows and a less stable capital position, which could prompt institutions to deny loans they might otherwise have approved. A change in expected cash flows could also have several indirect consequences. Criticized assets, assessed for impairment based on their expected future cash flows, could require a specific reserve due to lower present value of expected future cash flows.

The importance of fallback language in loan agreements

Fallback language in loan agreements plays a pivotal role in financial institutions’ ability to manage their LIBOR-related financial results. Most loan agreements include language that provides guidance for determining an alternate reference rate to “fall back” on in the event the loan’s original reference rate is discontinued. However, if this language is non-existent, contains fallbacks that are no longer adequate, or lacks certain key provisions, it can create unexpected issues when it comes time for financial institutions to reprice their LIBOR loans. Here are some examples:

• Non-existent or inadequate fallbacks
  According to the Alternative Reference Rates Committee, a group of private-market participants convened by the Federal Reserve to help ensure a successful LIBOR transition, "Most contracts referencing LIBOR do not appear to have envisioned a permanent or indefinite cessation of LIBOR and have fallbacks that would not be economically appropriate"⁴.
  
  For instance, industry regulators have warned that without updated fallback language, the discontinuation of LIBOR could prompt some variable-rate loans to become fixed-rate², causing unanticipated changes in interest rate risk for financial institutions. In a declining rate environment, this may prove beneficial as loans at variable rates become fixed. But in a rising rate environment, the resulting shrink in net interest margins would have a direct and adverse impact on the bottom line.

• No spread adjustment
  Once LIBOR is discontinued, LIBOR-indexed loans will need to be repriced at a new reference rate, which could be well above or below LIBOR. If loan agreements don’t provide for an adjustment of the spread between LIBOR and the new rate, that could prompt unexpected changes in the financial position of both borrowers and lenders³. Take, for instance, a loan made at the Secured Overnight Financing Rate (SOFR), generally considered the likely replacement for USD LIBOR. Since SOFR tends to be lower than three-month LIBOR, a loan agreement using it that does not allow for a spread adjustment would generate lower loan payments for the borrower, which means less interest income for the lender.
  
  Not allowing for a spread adjustment on reference rates lower than LIBOR could also cause a change in expected prepayments—say, for instance, if borrowers with fixed-rate loans decide to refinance at adjustable rates—which would impact post-CECL allowance calculations like the weighted-average remaining maturity (WARM) method, which uses estimated prepayments as an input.

What can your financial institution do to prepare?

The Federal Reserve and the SEC have urged financial institutions to immediately evaluate their LIBOR exposure and expedite their transition. Though the FDIC has expressed no intent to examine financial institutions for the status of LIBOR planning or critique loans based on use of LIBOR³, Federal Reserve supervisory teams have been including LIBOR transitions in their regular monitoring of large financial institutions⁵. The SEC has also encouraged companies to provide investors with robust disclosures regarding their LIBOR transition, which may include a notional value of LIBOR exposure².

Financial institutions should start by analyzing their LIBOR exposure beyond 2021. If you don’t expect significant exposure, further analysis may be unnecessary. However, if you do expect significant future LIBOR exposure, your institution should conduct stress testing using LIBOR as an isolated variable by running hypothetical transition scenarios and assessing the potential financial impact.

Closely examine and assess fallback language in loan agreements. For existing loan agreements, you may need to make amendments, which could require consent from counterparties². For new loan agreements maturing beyond 2021, lenders should consider selecting an alternate reference rate. New contract language for financial instruments and residential mortgages is currently being drafted by the International Securities Dealers Association and the Federal Housing Finance Authority, respectively³—both of which may prove helpful in updating loan agreements.

Lenders should also consider their underwriting policies. Loan underwriters will need to adjust the spread on new loans to accurately reflect the price of risk, because volatility and market tendencies of alternate loan reference rates may not mirror LIBOR’s. What’s more, SOFR lacks abundant historical data for use in analyzing volatility and market tendencies, making accurate loan pricing more difficult.

Conclusion: Start assessing your LIBOR risk soon

The cessation of LIBOR brings challenges and opportunities that will require in-depth analysis and making difficult decisions. Financial institutions and consumers should heed the advice of regulators and start assessing their LIBOR risk now. Those that do will not only be better prepared―but also better positioned―to capitalize on the opportunities it presents.

Need help assessing your LIBOR risk and preparing to transition? Contact BerryDunn’s financial services specialists.

¹ https://www.washingtonpost.com/business/2017/07/27/acdd411c-72bc-11e7-8c17-533c52b2f014_story.html?utm_term=.856137e72385
² Thomson Reuters Checkpoint Newsstand April 10, 2019
³ https://www.fdic.gov/regulations/examinations/supervisory/insights/siwin18/si-winter-2018.pdf
^{4 https://bankingjournal.aba.com/2019/04/libor-transition-panel-recommends-fallback-language-for-key-instruments/
5} https://www.reuters.com/article/us-usa-fed-libor/fed-urges-u-s-financial-industry-to-accelerate-libor-transition-idUSKCN1RM25T

Who has the time or resources to keep tabs on everything that everyone in an organization does? No one. Therefore, you naturally need to trust (at least on a certain level) the actions and motives of various personnel. At the top of your “trust level” are privileged users—such as system and network administrators and developers—who keep vital systems, applications, and hardware up and running. Yet, according to the 2019 Centrify Privileged Access Management in the Modern Threatscape survey, 74% of data breaches occurred using privileged accounts. The survey also revealed that of the organizations responding:

• 52% do not use password vaulting—password vaulting can help privileged users keep track of long, complex passwords for multiple accounts in an encrypted storage vault.
• 65% still share the use of root and other privileged access—when the use of root accounts is required, users should invoke commands to inherent the privileges of the account (SUDO) without actually using the account. This ensures “who” used the account can be tracked.
• Only 21% have implemented multi-factor authentication—the obvious benefit of multi-factor authentication is to enhance the security of authenticating users, but also in many sectors it is becoming a compliance requirement.
• Only 47% have implemented complete auditing and monitoring—thorough auditing and monitoring is vital to securing privileged accounts.

So how does one even begin to trust privileged accounts in today’s environment? 

1. Start with an inventory

To best manage and monitor your privileged accounts, start by finding and cataloguing all assets (servers, applications, databases, network devices, etc.) within the organization. This will be beneficial in all areas of information security such as asset management, change control and software inventory tracking. Next, inventory all users of each asset and ensure that privileged user accounts:

• Require privileges granted be based on roles and responsibilities
• Require strong and complex passwords (exceeding those of normal users)
• Have passwords that expire often (30 days recommended)
• Implement multi-factor authentication
• Are not shared with others and are not used for normal activity (the user of the privileged account should have a separate account for non-privileged or non-administrative activities)

If the account is only required for a service or application, disable the account’s ability to login from the server console and from across the network

2. Monitor—then monitor some more

The next step is to monitor the use of the identified privileged accounts. Enable event logging on all systems and aggregate to a log monitoring system or a Security Information and Event Management (SIEM) system that alerts in real time when privileged accounts are active. Configure the system to alert you when privileged accounts access sensitive data or alter database structure. Report any changes to device configurations, file structure, code, and executable programs. If these changes do not correlate to an approved change request, treat them as incidents and investigate.  

Consider software that analyzes user behavior and identifies deviations from normal activity. Privileged accounts that are accessing data or systems not part of their normal routine could be the indication of malicious activity or a database attack from a compromised privileged account. 

3. Secure the event logs

Finally, ensure that none of your privileged accounts have access to the logs being used for monitoring, nor have the ability to alter or delete those logs. In addition to real time monitoring and alerting, the log management system should have the ability to produce reports for periodic review by information security staff. The reports should also be archived for forensic purposes in the event of a breach or compromise.

Gain further assistance (and peace of mind) 

BerryDunn understands how privileged accounts should be monitored and audited. We can help your organization assess your current event management process and make recommendations if improvements are needed. Contact our team.

Law enforcement, courts, prosecutors, and corrections personnel provide many complex, seemingly limitless services. Seemingly is the key word here, for in reality these personnel provide a set number of incredibly important services.

Therefore, it should surprise no one that justice and public safety (J&PS) IT departments should also provide a well-defined set of services. However, these departments are often viewed as parking lots for all technical problems. The disconnect between IT and other J&PS business units often stems from differences in organizational culture and structure, and differing department objectives and goals. As a result, J&PS organizations often experience misperception between business units and IT. The solution to this disconnect and misperception? Defining IT department services.

The benefits of defined IT services

1. Increased business customer satisfaction. Once IT services align with customer needs, and expectations are established (e.g., service costs and service level agreements), customers can expect to receive the services they agreed to, and the IT department can align staff and skill levels to successfully meet those needs.
2. Improved IT personnel morale. With clear definition of the services they provide to their customers, including clearly defined processes for customers to request those services, IT personnel will no longer be subject to “rogue” questions or requests, and customers won’t be inclined to circumvent the process. This decreases IT staff stress and enables them to focus on their roles in providing the defined services. 
3. Better alignment of IT services to organizational needs. Through collaboration between the business and IT organizations, the business is able to clearly articulate the IT services that are, and aren’t, required. IT can help define realistic service levels and associated services costs, and can align IT staff and skills to the agreed-upon services. This results in increased IT effectiveness and reduced confusion regarding what services the business can expect from IT.
4. More collaboration between IT and the organization. The collaboration between the IT and business units in defining services results in an enhanced relationship between these organizations, increasing trust and clarifying expectations. This collaborative model continues as the services required by the business evolve, and IT evolves to support them.
5. Reduced costs. J&PS organizations that fail to strategically align IT and business strategy face increasing financial costs, as the organization is unable to invest IT dollars wisely. When a business doesn’t see IT as an enabler of business strategy, IT is no longer the provider of choice—and ultimately risks IT services being outsourced to a third-party vendor.

Next steps
Once a J&PS IT department defines its services to support business needs, it then can align the IT staffing model (i.e., numbers of staff, skill sets, roles and responsibilities), and continue to collaborate with the business to identify evolving services, as well as remove services that are no longer relevant. Contact us for help with this next step and other IT strategies and tactics for justice and public safety organizations.

If you’ve been tasked with leading a high-impact project for your organization, you may find managing the scope, budget and schedule is not enough to ensure project success—especially when you encounter resistance to change. When embarking on large-scale change projects spanning people, processes and technology, appointing staff as “coaches” to help support stakeholders through the change—and to manage resistance to the change—can help increase adoption and buy-in for a new way of doing things.

The first step is to identify candidates for the coaching role. These candidates are often supervisory staff who have credibility in the organization—whether as a subject matter expert, through internal leadership, or from having a history of client satisfaction. Next, you need a work plan to orient them to this role. One critical component is making sure the coaches themselves understand what the change means for their role, and have fully committed before asking them to coach others. They may exhibit initial resistance to the change you will need to manage before they can be effective coaches. According to research done by Prosci®, a leading change management research organization, some of the most common reasons for supervisor resistance in large-scale change projects are:

• Lack of awareness about and involvement in the change
• Loss of control or negative impact on job role
• Increased work load (i.e., lack of time)
• Culture of change resistance and past failures
• Impact to their team

You should anticipate encountering these and other types of resistance from staff while preparing them to be coaches. Once coaches buy into the change, they will need ongoing support and guidance to fulfill their role. This support will vary by individual, but may be correlated to what managerial skills they already possess, or don’t. How can you focus on developing coaching skills among your staff for purposes of the project? Prosci® recommends a successful change coach take on the following roles:

• Communicator—communicate with direct reports about the change
• Liaison—engage and liaise with the project team
• Advocate—advocate and champion the change
• Resistance manager—identify and manage resistance
• Coach—coach employees through the change

One of the initial tasks for your coaches will be to assess the existing level of change resistance and evaluate what resistance you may encounter. Prosci® identifies three types of resistance management work for your coaches to begin engaging in as they meet with their employees about the change:

• Resistance prevention―by providing engagement opportunities for stakeholders throughout the project, building awareness about the change early on, and reinforcing executive-level support, coaches can often head off expected resistance.
• Proactive resistance management―this approach requires coaches to anticipate the needs and understand the characteristics of their staff, and assess how they might react to change in light of these attributes. Coaches can then plan for likely forms of resistance in advance, with a structured mitigation approach.
• Reactive resistance management―this focuses on resistance that has not been mitigated with the previous two types of resistance management, but instead persists or endures for an extended amount of time. This type of management may require more analysis and planning, particularly as the project nears its completion date.

Do you have candidates in your organization who may need support transitioning into coaching roles? Do you anticipate change resistance among your stakeholders? Contact us and we can help you develop a plan to address your specific challenges.