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5 Keys to Government’s Digital Transformation

It's risky and wrenching, but nothing is more important for the future of service delivery.

An aging population, the rise of millennials, budget shortfalls and ballooning entitlement spending all will significantly impact the way government delivers services in the coming decades, but no single factor will be more important than the pure power of digital technologies.

Governments at all levels are in the midst of a historic (and frequently wrenching) transformation as they abandon analog operating models in favor of their digital counterparts. This is happening not only in the United States but across the world.

To get a picture of the current state of public-sector digital transformation, Deloitte Digital surveyed more than 1,200 officials from more than 70 countries and interviewed another 140 government leaders and outside experts. This research identified key issues that public leaders should consider to accelerate digital transformation. They cover five interlacing topics: strategy, user focus, culture, workforce skills and procurement.

1: Do we have a clear and coherent digital strategy that addresses the key elements of digital transformation?

What separates digital leaders from the rest is having a clear technology strategy combined with an organizational culture and leadership poised to drive the transformation. This should not be surprising, given that the history of technological advancement is strewn with examples of organizations focusing on technologies without investing in organizational capabilities.

Governments have been particularly prone to this trap. Case in point: Early efforts to put computers in schools failed to result in performance improvements because they weren't accompanied by fundamental changes in teaching methods and appropriate training that complemented the technology.

Digitally mature government organizations have a digital strategy aimed at fundamental transformation. "Transformation means more than fixing websites. It goes deeper than that, right into the organizations behind the websites," as Mike Bracken, the former chief digital and chief data officer for the government of the United Kingdom, has written. "There's a logic to it: Digital service design means designing the whole service, not just the digital bits. If you're redesigning a service, you need to think about the organization that runs it."

Any strategy, however, must consider the other four questions that government leaders should be asking:

2: How can service users be part of our digital transformation?

In a swiftly evolving digital environment, administrators are unlikely to be able to predict the exact needs of their clients. Citizens deserve tools and flexible, user-friendly services, not rides to a destination an agency has anticipated on their behalf.

This demands the co-creation of processes and services. For example, New Zealand once allowed citizens to edit a crime bill, much like the process employed by Wikipedia, before legislators finalized the wording. Singapore opened 3,000 datasets to co-create more than 110 apps with its citizens. And the U.S. Treasury collects citizen feedback not only through traditional approaches but also through website metrics.

That's just a start. Understanding user needs can require ethnographic research -- observing target users in their real-world settings, as opposed to labs or focus groups. Designing services from the "outside in" rather than the traditional "inside out" means that government needs to understand the population it serves and build programs around life events such as having a baby, moving or losing a job.

3: What have we done to strengthen our organization's innovative and collaborative culture?

Digital transformation thrives in an organizational culture with an agile development process that includes such elements as co-creation, openness to ideas from outside the organization, crowdsourcing and a Silicon Valley-style fail-fast-fail-quickly approach to risk.

Culture is exceptionally challenging to reshape. For example, we found resistance to fail-fast approaches in defense departments worldwide. The military culture of perfection and risk avoidance can balk at the uncertainty of innovation through failure. Courageous leadership and tenacity from the top are required to achieve transformation of culture.

4: Have we looked at our talent pool and planned where our skills will come from?

New technology -- or even new workflows -- require a capable, trained workforce. Organizations can develop talent through "re-skilling" programs, such as the six-week digital boot camps run by the U.K.'s Department of Work and Pensions, or by hiring new workers with the skills necessary to thrive in a new culture. To attract younger workers who have private-sector opportunities, organizations will need to emphasize the altruistic values of public service, reduce a sense of hogtied bureaucratic anonymity, and offer increased flexibility and challenge.

But culture changes need to precede efforts to attract these applicants. "You could recruit people into a bad environment," says Greg Godbout, the U.S. Department of Energy's chief technology officer. "Those people would tell their friends, and things would fall apart after that. It's not enough to just recruit."

5: Do our organization's existing procurement processes enable digital transformation?

Governmental organizations should simplify procurement so that winning bids depend on capabilities to actually deliver rather than familiarity with the bidding process. The U.S. Department of Health and Human Services' Buyers Club has pioneered this sort of open-proposal approach to procurement -- a strategy that also welcomes smaller upstart bidders. Likewise, new procurements should break large contracts into smaller parts, shift to open standards for data interfaces, promote collaboration, and retain flexibility and agility. These changes to standard approaches may require developing specific procurement talent.

As our research has shown -- and as innovative public leaders know only too well -- a digital transformation is not an easy process. But we've seen remarkable successes from organizations willing to take a risk and try. At this point, few governments can afford not to.

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