Transforming Government Like Disney?

Should the federal government be more like Disney when delivering its customer service experiences?

Greg Godbout, the chief technology officer at the Environmental Protection Agency, suggests as much when he keynoted an AFCEA roundtable in Bethesda a couple weeks ago.  According to Federal Times, he told the audience how Walt Disney World delivers a seamless experience:  “Visitors to the theme park who are staying at a connected hotel can get a “Magic Band,” a wrist band that unlocks the hotel room, grants admission to the park, reserves access to certain attractions and allows the guest to buy items at shops and charge them to the room.”  He went on to say that it is “. . . one seamless organic organization, really one service-oriented architecture. That’s how we should be able to work in government, yet we are so far away from that experience.”

But a recent article by Austin Carr for Fast Company magazine chronicles in rich detail the exceedingly difficult modernization efforts that Disney underwent to get to this point – and that it has a long ways to go before it is fully implemented.

So — could the federal government possibly undertake the same degree of transformation? It has undertaken successful transformations in the past – just look at how the Internal Revenue Service moved from a paper-based to an Internet-based individual tax filing experience over the past two decades.  Similarly, the National Geospatial Intelligence Agency transformed two separate functions – static map-making and satellite photo interpretation – to an integrated “Google Map” like experience for its customers, with constant monitoring of high-value targets. And Federal Student Aid shifted its student loan portfolio from guaranteed-bank loans to direct lending. It wasn’t easy, but it wasn’t easy for Disney, either.

The Back Story on Disney’s Magic Bands.  What did it take for Disney to move to “Magic Bands,” which are electronic wrist bands designed to create a seamless experience in their theme parks, starting with Disney World in Orlando, Florida?  For visitors, the wrist bands allow them to gain access to the parks and attractions, make purchases at restaurants, ride the monorail, and unlock their hotel doors.  For Disney, it would provide a rich source of customer behavior data to improve its hospitality and transportation services – and increase its understanding of what visitors want.

It undertook the initiative because its surveys over the years showed declining interest by visitors in returning to the theme parks.  They were more interested in their use of social media and smartphones than in the increasingly long lines in Disney parks for rides, food, and bathrooms.  When coupled with complex tiered-ticketing rules and other complications, it cried out for redesign. In response, Disney launched a Next Generation Experience team in 2008 to come up with a turnaround strategy.  That resulted in the 2011 wristband proposal.

Getting Started.  Disney CEO Bob Iger put Tom Staggs, the chair of Disney’s Park and Resorts division, in charge.  Iger and Disney’s board of directors gave Staggs nearly $1 billion for the initiative, with the admonition: “This better work.”  While the project “didn’t fully deliver on its massive ambitions,” according to the Fast Company writer, it did turn around declines in visitor perceptions and increased both the number of visitors and profits.

The initiative sounds simple, but required a “sweeping plan to overhaul the digital infrastructure of Disney’s theme parks.”  This included producing affordable electronic wristbands, creating a wi-fi mesh for the Orlando park covering an area the size of San Francisco, and swapping out the locks on 28,000 hotel doors.  It also meant retraining 70,000 cast members on the use of the wristbands and how they could be used to purchase souvenirs and rides and hundreds of other uses by staff.

The Bureaucratic Infighting.  Disney publicly announced its “MyMagic+” initiative in January 2013, and completed its rollout in Disney World in mid-2014.  But it wasn’t easy.  The Disney Parks division was “built to be industrial and resilient, for consistency and volume; it’s not built for change,” noted one former Disney executive.  Previous transformational efforts failed “because the culture killed them.”

So for this initiative, Disney executives leading the project went outside the company for help, and tried to keep the initiative secret.  Of course, the secret leaked and “the pushback was huge” from multiple stakeholders – park security, IT, operations, marketing, etc.  — “There was never any shortage of pushback,” noted one executive involved. They all wanted a piece of the money being invested and they were trying to protect their jobs.  After all, if the wristbands could be used to gain entrance to the park and rides, what would happen to the ticket takers?

The biggest opposition, however, was from the stewards of Walt Disney’s creative legacy, Disney’s famed Imagineers.  The Imagineers are responsible for preserving the Disney Experience for visitors.  They preserve the culture.  And they fought the design team’s technology hardware, saying “If I’m supposed to be living with fairies, fairies don’t have iPhones or MagicBands . . . A big part of the company culture is trying to guard against dangerous change.”  And the wristbands were seen as dangerous.

Staff attempted to sabotage tests of the equipment.  They would secretly explore their own alternatives to the MagicBand.  They wouldn’t flag potential problems, in hopes the design team would not see them and fail.  One of the design team members observed: “it changed the way we worked.  It became more about infighting to survive another day.”  But they persevered.

The Launch.  The public announcement in January 2013 over-promised functionality – such as electronic seagulls that would speak directly to MagicBand wearers – and under-delivered – they uncovered 250 hardware and software defects and had to spend $80 million more to redesign the DisneyWorld.com website to integrate the wristband experience.  But the launch happened.

Did It Work?  Given all the hiccups, the MagicBand was seen as successful by outsiders. It cut turnstile transaction time by 30 percent.  It allowed an additional 5,000 people into the park without reducing the Disney Experience.  And guests spent more money in the park.  Most importantly, overall visitor satisfaction increased to the 70-percent range.

In early 2015, Staggs was appointed chief operating officer, in part because of his success in increasing revenues and profits in the Parks division – in part because of the MagicBand.  Disney delivered spectacular earning and its stock soared to an all-time high.  The focus was on the success, not the problems.  In fact, Staggs told the Fast Company reporter: “The key is the collaboration across literally everything from food and beverage, IT folks, online folks, our industrial engineers, our merchandise folks, our core operations team, the finance organization. . . .it would be folly to say that anything other than the collaborative approach we took would’ve been successful.”

What’s the Take-Away for Feds?  If it is so hard for Disney to transform, how much harder must it be for federal agencies?  At Disney, they had the leadership, the money, the talent, and the time to do it – and yet it oftentimes seem to teeter on the edge of failure.

Imagine if they had a fractious board of directors pulling the team in a different direction than the CEO?  If they had public oversight hearings, IG reports, spending sequesters, and targets for contract spending for small businesses, etc.?

Yet this is the environment that the Federal Aviation Administration faces as it transforms the air traffic control system from ground-based radar centers to space-based GPS systems.  And the Defense and VA systems face in creating interoperable medical records for service members.  And the Census faces as it moves to an internet- and mobile-tablet-based Census in 2020.

That huge transformations such as these in the federal government can occur at all reflect the heroic efforts of dedicated civil servants.  So maybe the interconnectedness proposed by EPA’s Godbout isn’t there yet, but it isn’t easy, even for Disney!

Graphic Credit:  Courtesy of David Castillo Dominici via FreeDigitalPhotos.net