The Last Mile — the Role of the Marketplace in the Public-Private Value Chain

Abstract for 2017 AMS Annual Meeting
Submitted for the Fifth Symposium on the Weather, Water, and Climate Enterprise

Session: Exploring the Public-Private Sector Partnership Value Chain

January 22-27 2017, Seattle WA

The Last Mile - the Role of the Marketplace in the Public-Private Value Chain

Steve Woll, WeatherFlow Inc.

swoll@weatherflow.com, 757-289-1529

As the Weather, Water, and Climate Enterprise moves deeper into the 21st Century, public-private partnerships are assuming an ever-increasing role.  While this trend is often triggered by funding constraints, it can actually deliver a better suite of products and services to a wide spectrum of users.

Any highly valued weather, water, or climate product or service is marked by two characteristics: 1) it has been produced via a production process that is rigorous and as scientifically advanced as is reasonable, and 2) it has been produced with an understanding of the targeted user's requirements and environmental sensitivities, and therefore adds value by having a marked impact on the user's decisions and operations.

The merits of such an approach are reflected in the recent Impact-Based Decision Support Services (IDSS) initiative by the National Weather Service (NWS).  The NWS' initial focus has been on supporting Emergency Management agencies, an area of activity that is widely accepted to be an inherently governmental function, and one which can reasonably be expected to be a perpetual requirement.

However, there are literally thousands of other applications of weather, water, and climate information to activities in the public and private sector, and it is extremely unlikely that the NWS or any other government agency will ever expect or desire to support all of them.  In addition, these other requirements are more likely to evolve and change over time than are Emergency Management requirements, as customer needs and technological solutions evolve.

For maximum enterprise-wide efficiency and effectiveness, there needs to be a robust mechanism to use ever-changing user needs to continually "tune" the products and services that are generated by public and private sector producers.  The lack of such a mechanism results in "ghost" products and services that stay active long beyond their useful life, wasting precious resources.  Public sector organizations can provide many examples of products or services that (perhaps unknowingly) have few or even zero users, often continuing until some extraordinary event (often negative) calls attention to it, at which point the product is modified or canceled.

Waiting for an extraordinary (and often embarrassing) event is an unacceptably dull instrument for use in the ongoing evaluation of products and services.  Quite simply, in the current and future funding environment, the enterprise cannot continue to waste resources on unneeded or even inefficient efforts.

Thankfully, a mechanism to continually evaluate products and services already exists, with thousands of years of proven performance - the fee-based, free enterprise marketplace.  While not the norm for much of the history of the U.S. weather, water, and climate enterprise, the practice of charging end-user fees creates a highly accurate feedback loop and provides an immediate and unambiguous signal about how much value customers place on a particular product or service.  In the aggregate, if the fees collected are less than the cost of generation, then the overall value to the enterprise (including users) is a net negative, and the product or service should be discontinued or modified so that it provides increased value and/or can be produced more inexpensively.

When end-user fees are employed, the market feedback mechanism is instantly in place and requires no extra effort or exotic processes - it uses the same "invisible hand" by which millions of businesses operate, live, and die every year.  Rather than begrudge this, enterprise should embrace this "Last Mile" commercial transaction (i.e. end user fees between a commercial provider and the end user) as the most effective way to provide accurate, unbiased, instantaneous, and ongoing feedback about what products and services are valued by the customer base.

Rather than being viewed as a threat to the enterprise, this highly effective feedback mechanism will help impose a new and much-needed discipline to the enterprise's generation of products and services.  Those products and services that add value will be instantly recognizable, whereas those that cost more to produce than they provide in benefit can be culled or modified rapidly, without need of extraordinary events or extensive study.  By embracing what the marketplace has to offer, the current era of shrinking government budgets need not mark the beginning of the decline of the weather, water, and climate enterprise, but instead can trigger a renaissance that will produce an overall level of service that produces higher quality products and services, meets the needs of the users more effectively, and does so at an overall lower cost to the taxpayer and user.