Mark Gibbison, Head of Strategic Motions for New Business at Unit4, examines the potential for public sector transformation
The trauma of the past two years has not been selective, affecting both the public sector as well as private enterprises.
Now, a new State of the Digital Nation survey, conducted by Vanson Bourne across 800 public-sector decision-makers in Europe, Australia and North America, highlights the intense pressure put on state operations all over the world and across emergency services, healthcare and central government among others. But, leaving aside for a moment the shock of the pandemic, what can be done to mitigate the myriad challenges facing state provisions?
The research suggests embracing change will be key but also suggests that boldness and confidence are a mixed bag.
The most urgent state services are being squeezed
Let it be plainly said that the severity of the situation can’t be overstated: we are amid an existential crisis. Cutting citizen and/or community services represents the leading cost-saving measure globally, according to the survey, despite rising public-sector expenditure globally. Having been forced to cut to the core, it appears that even the most urgent state services are being squeezed. This is especially the case with local government and healthcare whereas in central government, the biggest focus is on driving value via outsourcing services.
In a world moving so fast, staying open and communicative works best for all. It’s no surprise therefore to see public pressure build to make spending policy and details transparent. Here, the UK (63%) and Australia rank highest, while agencies with the highest requirement for open disclosure are the most sensitive and closely watched units: emergency services (59%), healthcare (58%) and central government (56%).
What’s preventing change?
In short, our old enemy, inertia. Leadership resistance to change is the number-one challenge for UK organisations that are adapting to services change. The knock-on effect is to make laggards of us all. It will take an average of two-and-a-half years to deploy digital transformation across entire organisations. The picture is relatively consistent, although in healthcare, under severe duress due to pandemic issues, the rate of change is a little faster at 2.3 years.
But there are other hurdles too. Over four in 10 (41%) respondents globally say big improvements in data compatibility are needed while 16% believe wholesale changes are needed. This suggests that data management is in a woeful state, probably caused by data siloes emerging over generations of platforms, operating systems, applications and missed opportunities to improve the quality, metadata and consistency of data repositories.
In some ways, we remain in the digital dark ages. Respondents complain that systems are too complex and not joined-up. A further 38% globally say data is manually entered from physical documents to digital systems and 43% say data is still manually exported from one system to another. These processes are not only expensive but also insecure and prone to user errors that lead to squandered productivity as well as lost or exposed sensitive data. Furthermore, they place the onus on users with 86% of respondents arguing that their staff don’t have the right skills to execute, and capitalise on, back-office transformation.
And in spite of the aforementioned leadership inaction, there are also parallel concerns that senior management are overly confident in their assessment of the delivery of digital transformation with 47% of global top-level management and 44% of high-level management optimistically believing that transformation will be delivered on time.
Closer to the ground, only 5% of junior level management agree with this statement: that’s a vast chasm in confidence. Similarly, 51% of global top-level management and 48% of high-level management believe transformation will be delivered within budget, compared to only 5% of junior level management. Something is happening here as both stakeholders can’t be right…
Otherwise, confidence levels are bottoming out. Just 12% of UK respondents to the survey say their organisations are overperforming in what is effectively the engine room of back-office digital transformation to enable collaboration and productivity. Most deem themselves as either cautious followers (38%) or enthusiastic evaluators (39%).
What about the UK versus other countries?
Although higher than the 9% global average, the UK lags behind more confident peers in Sweden, Belgium and the US. The UK also appears to be caught up in something of a halfway-house situation with the highest proportion surveyed (56%) having partially rolled out transformative projects. That’s a fairly mediocre example compared to the private sector in an age where digitally enabled change and transformation is key to future prosperity and wellbeing.
While usually we see high levels of variegation in the impacts of phenomena such as recessions, Covid-19 has proven a great equaliser in terms of levelling down. All over the world, the public sector continues to face one of the toughest challenges in peacetime history. As the economy has tanked, so have the tax receipts needed to invest in state care.
This only accentuates the need for cost-effective digital change to move fast, enable citizen self-service, slash logistics and paperwork, and trim costs from manual inputs. More happily, the survey indicates a desire to urgently address data management tools (55%), cloud migration (50%) and updating/replacing legacy systems (47%).
Also, there is a greater opportunity today in a work-from-anywhere culture to recruit from further afield. But more advanced technologies such as AI are flying under the radar. The required change will inevitably require a leap of faith and mean short-term disruption but, to reap benefits, that’s a relatively small price to pay.
