creating value in government: practices and challenges · 2016-06-16 · the value of shared...
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Creating Value in Government: Practices and ChallengesMassimiliano Claps
Associate Vice President
IDC EMEA Government Insights
Drivers for change: what is challenging the traditional way of delivering value
How government transformation can deliver better value
How to make it happen
Agenda
2
A perfect storm for change in government
3
Operational
improvements to tackle
resource constraints
Policy reforms to
address social and
economic shifts
Service delivery reforms
to improve citizens’ life
Real issues must be solved not only at the national level: cities are
center stage in the 21st century
4
Source: UN, UK National Statistics, INRIX
Cities account for:
75% of an average country’s GDP
75% of global primary energy consumption
50% to 60% of global greenhouse gas emissions
In the U.S., city commuters spend 7 billion hours in traffic jams
that cost the whole economy an estimated $160 billion
In the U.K. the rate of violent crime is approx. 12 acts per 1000 people in
urban areas and below 7 per 1000 people in rural areas
23% of the world’s population lives in cities within 100 km distance of the
coast, thus are exposed to saltwater intrusion and risk of flooding
5466
2014 2050
Urban population as a % of total population
globally
Transformation is a continuous improvement journey
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Offering
Delivery model
Geographical coverage
Organization
Processes and systems
ToFrom
Standard output-driven programs
Bureaucratic, leading to duplicate G2C interactions
Direct control of specialist, local branches
Functional silos, supported by process compliance culture
Rigid, vertically integrated processes and systems
Segmented, dynamic, outcome-driven service portfolio
Omni-channel, proactive, convenient
Rationalization of local presence and collaboration with intermediaries
Citizen centric organization, supported by a culture of collaboration and
accountability
Open architecture that enables secure, transparent data sharing and agile
process innovation
Drivers for change: what is challenging the traditional way of delivering value
How government transformation can deliver better value
How to make it happen
Agenda
6
Creating value through transformation: the complexity of the government value
ecosystem
Outcomes
Resources
Value
Risks• Financial
• Technical
• Organizational
• Project
• Political
• Legal
• Security
Constituent experience• Access to service
• Quality of service
• Personalization of service
People• Number of staff
• Knowledge and skills
• Rewards (salary) and
recognition
Political outcomes• Transparency and participation
• Economic development
• Social inclusion
• National security and safety
• Public finance sustainability
Assets/technology• Design
• Sourcing
• Implementation
• Management
• Decomissioning
Operational effectiveness• Reducing fraud, waste and
abuse
• Increasing productivity
• Making decision-making more
effective
Processes• Policies and procedures
• Organizational structures
• Standards and guidelines
• Culture
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X Risks =
A wide variety of options
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Type of
initiativeExamples of initiatives
Time to value
realizationLevel of risk
Reducing
waste
• Renegotiating contracts
• Ending underperforming projects
• Delaying asset replacement
cycles
• 3 to 12
months• Low
Revamping
productivity
• Centralizing procurement
• Consolidating assets
• Implementing process
management best practices
• 1 to 3 years • Medium
Transformation
• Digital services
• Shared services
• Data-driven decision making
• 2 to 4 years • High
Value
• Low
• Medium
• High
Self-Service may seem a straightforward answer to the need to
improve user experience and reduce costs...BUT
Cost of channels for accessing
services (cost per visit)
Self-service
website 0.25
Customer
contact
center
1.39
Face-to-
Face14.65
Source: Tameside Borough Council, 2006
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Cost per transaction for selected government services
Source: Guardian analysis based on Cabinet Office data
Access to the service can be only a fraction of the total cost
Increasing impact of
service transaction
automation on total
government
expenditure
10
The convenience of new channels can unleash latent demand
-
50.000
100.000
150.000
200.000
250.000
300.000
350.000
400.000
CY 2009 CY 2010 CY 2011 CY 2012 CY 2013 CY 2014 CY 2015
Six years time-series of citizen service requests managed bySan Francisco 311
Inter-agency and others
311 Mobile app
Web Self Service
Call center
Source: City of San Francisco
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The digital divide has still many facets
0
10
20
30
40
50
60
Reading news Interacting with publicauthorities
Internet banking Travel and accommodationservices
Job search or sending anapplication
Internet Usage in Portugal (% of individuals)
All Individuals
Unemployed
Individuals living in sparsely populated area (less than 100 inhabitants/Km²)
Individuals with no or low formal education
Individuals, 55 to 74 years old
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Ann (grandma)
Matthew (grandson)
Social housing authority
customer service representative
Ann’s daughter
Borough council adult
service department’s
occupational therapist
Ann is jolly
happy!
Natural Interfaces: By 2018,
30% of last-mile citizen
engagements will be
transformed by the ecosystem
of human-machine interactions
through mobile and natural
interfaces
ePersonalization: By 2018, 75% of state and
local governments will leverage externally
generated real-time citizen data for service
customization
Omni-channel citizen experience at the core of service personalization
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Breaking down departmental siloes can enable omni-channel convenience and
eliminate duplication
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Paper based Digital attribute exchange
Shared services have been a primary driver of value in public sector
Shared services is a service delivery model, where an
organization offers a defined set of services, to multiple public
sector entities
15
The example of shared contracting and procurement in Europe
UK: Performance of the Crown Commercial Service
Italy: Performance of Consip Framework Contracts
2001 2013
Total value of
transactions (mln €)294 4,410
Average % savings
on basis price32% 23%
# of orders 32,614 85,647
Active buyers 6,539 15,833
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Source: www.consip.itSource: ccs.cabinetoffice.gov.uk
Managed spend as of March
2014 (£million)
Framework
agreements11,403
Managed services 1,294
Memoranda of
understanding480
2013-2014 price savings
against 2009/10 baseline
(£million)
Central government 893
Wider public sector 678
The value of shared services, well beyond cost savings
• Service excellence:
• Specialize and focus resources and competencies to increase availability, business continuity, security, agility, and response time
• Enhance agility to provide innovative business capabilities, because common components included in the catalog do not need an
entirely new feasibility study and tender every time
• Implement service excellence best practices (e.g. COBIT) and continuous improvement approaches (e.g. lean management)
• Cost efficiencies:
• Increase bargaining power vis-à-vis third-party suppliers
• Consolidate assets to eliminate redundancies and share CAPEX
• Rationalize skills, so that human resources can be leveraged at scale
• Optimize service management processes
• Eliminate duplicate workflows
• Automate processes through tools that can streamline configuration, provisioning, continuous monitoring
• Management transparency and accountability:
• Establish, document and monitor performance metrics aligned with SLAs
• Keep risks under control by making people accountable to take decisions in case of lack of performance
• Increase legitimacy of IT through more transparent IT investment decisions and benefits realization
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Opening to the broader ecosystem of government, non-profit and commercial
partners: towards ‘Government as a Platform’
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Service delivery
IT infrastructure
Constituent/citizen experience
Government resource planning
Citizen/Business IDBooking/ scheduling
Payments
Invoicing
Recruiting
Cloud
Procurement
By 2017, at least 15% of government services will
be delivered through plug and play third-party
capabilities
Data exchange
STRATEGIC INTENT• Program goal
• Audience
PROCESSES and GOVERNANCE• Who is accountable for data
management
PEOPLE• Skills
• Culture
DATA• Format
• Source
TECHNOLOGY• Interface
• Application
• Infrastructure
• Openness/ transparency• The public
• Whole of government CIO/CDO
• Data collection and aggregation• Proactive sharing of
comprehensive data
• Any format • All government DBs with non-
sensitive data
• Whole of government open data portal
• Public cloud
• Accountability• Civil servants, other
governments, concerned citizens, NGOs, press
• CIO/CDOs and non-IT executives managing KPIs
• Data analysis and visualization• Trusted (accurate, consistent, up-
to-date) data provisioning
• HTTP, PDF, PPT, XLS, video• Government DBs with finance,
procurement, etc. data
• Dashboards&scorecards.• Hybrid - Some data will remain
on-premise for compliance, integrity and availability
• Monetization • Data buyers, aggregators and
app developers
• CIO/CDOs and non-IT executives managing data with socio-economic value
• Data ownership and brokerage• Granular and timely data
provisioning
• XLS, CSV, JSC, XML and other machine readable
• Selected government DBs
• API marketplace• Digital media right management
to monitor IPR compliance• Hybrid cloud
Open Data can grow transparency, accountability and revenues, but must be
treated as a strategic program
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Public Image
Professional reputation
Trust
Legal responsibilities
Taxpayers/ fundingagents
Regulatoryframework
Soci
o-E
con
om
icco
nte
xt
Customers
Agents
Envi
ron
me
nta
lris
ks
Strategic risks
Accounting and financial risks
Operational risks
People and asset safety/ securityrisks
Frauds
Organization and system modernization risks
Fighting waste, fraud and abuse starts with better risk and compliance
processes: Pôle Emploi risk map
Source: Pôle Emploi, 2013
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Share data to go after external fraud and abuse
Excluded Parties List
SystemDebt Check Database
List of Excluded Parties
and EntitiesCredit Alert System
Death Master File
IPERA
Source: US Federal Government Improper Payments Eliination and Recovery Act 2010
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Drivers for change: what is challenging the traditional way of delivering value
How government transformation can deliver better value
How to make it happen
Agenda
22
Investment in digital tools is important, but NOT enough
17%24%
23%
23%
61%53%
0%
25%
50%
75%
100%
2014 2015
% of Western European government IT executives investing in mobile apps for citizens
Deployed or currently deploying Planning to deploy in the next 12 months No, and not planning
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Number of respondents = 275 governent IT executives in France, Germany, Italy, Nordics, Spain, UK
Source: European Industry IT Executive Survey, 2015
Bureaucratic citizen request management
Citizen requests flow in through multiple channels. Limited information sharing across channels and missions/programs
Business Outcome
Ensure compliance with minimum service levels set for the average citizen
CRM digitization
A client-server CRM applications enable front end automation by web-enabling services and start to offer integration of information across web and call center
Business Outcome
Reduce the cost of intakingcitizen requests and offer citizens channel options
Citizen-centric self-service
The digitization of workflows and integration across channels and between front and middle office allows citizens to handle some services in a fully automated manner.
Business Outcome
Services start to be redesigned around citizens’ needs, so that convenience of service access increases
Citizen digital service integration
Digital self-service is extended to enable citizen to experience a one-stop shop across multiple agencies, while traditional tools are augmented by web 2.0 solutions for a more interactive handling of citizen requests.
Business Outcome
Citizen service is optimized across multiple agencies to reduce duplication of workflows and data
Omni-channel citizen experience
Omni-channel ensures a consistent experience in the most convenient context for the citizen and the lowest cost for the government. Integrated citizen data are used to proactively offer services in the context that is relevant to the individual.
Business Outcome
Citizens experience collaborative and transparent interactions with governments, so that their overall satisfaction increases, across missions and services
Constituent experience enhancement is a continuous improvement journey
24Source: IDC MaturityScape: Citizen Experience
Go beyond ‘availability’ of self-service
© IDC Visit us at IDC.com and follow us on Twitter: @IDC 25
Sources: European Commission eGovernment Benchmarking, 2015
96
965660
98
96
56
60
Online availability
Usability
Ease of use
Speed of use
Four components of User Centricity for Portugal across life events
2013 2014
Shared, spare resources
Spare assets and competencies are made available to other to organizational units that have constraints limiting their efficiency and effectiveness.
Business Outcome
Avoiding investments deemed unnecessary and establishing common knowledge and practices
Cost cutting
Resources and competencies are pooled under a common leadership to tackle more efficiently cross-enterprise programs and projects, but custom efforts are required to support individual BUs
Business Outcome
Drive cash savings through more centralized sharing of activities for procuring and maintaining IT assets and services, and increase timeliness of response
Asset and process cost control
IT assets are consolidated and processes standardized under a central organization, the shared services center, to perform the business function more efficiently.
Business Outcome
Consistent service delivery –reducing mistakes and enabling monitoring of enterprise-wide performance metrics –complements net cash savings
Operational excellence
The shared services center combines people, processes and technologies to increase operational excellence for end-to-end service delivery to business users.
Business Outcome
Increased customer satisfaction for business users and strong management control on overall service performance and quality
Business Value creation
The shared services center becomes a center of excellence that proactively supplies the whole enterprise with value-added services for sustainable competitive advantage.
Business Outcome
Optimized service offered to end-users allows them to free up precious resources and competencies to focus on core activities that sustain enterprise-wide competitive advantage
The same is true for shared services: take care of the end-to-end journey
26Source: IDC MaturityScape: Shared Services
Dimension Sub-dimension
Mission Strategic goals Value
Target customers Scope of services Governance
Service management Performance managementCustomer relationship management
Funding Sourcing managementProgram and portfolio management
Functionality Infrastructure Tools
Organization Skills Culture
And of all dimensions necessary to make it happen
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Leadership trasformation: addressing goal and authority ambiguities to focus
the strategy on value delivery
Goal
Ambiguity
Authority
Ambiguity
Plurality of
Interests
Different
degree of
power
Inertia and
garbage for
decision
making
Management
process
Ambiguity
Define value in a holistic manner
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The elected official point of view… the mission executive point of view… the
service manager point of view… the finance director point of view… the
procurement officer point of view… the legal department point of view… the
chief information officer point of view
Shared services provider vs. service user
Immature investment management… sourcing management… portfolio and
program management… budgeting… risk and performance management…
service management
And manage performance by looking at value from multiple angles
Source: European Union Digital Agenda - eGovernment Benchmarking
29
FROMTraditional Resources and Competences
TOTransformed Resources and
Competences
• Civil servants, outsourcers and contractors are mostly
supplementary and uncoordinated
• Task, process or compliance related
• Static
• Salary / price
• Seniority / SLA
• Department or agency or vendor
Sourcing model
Type of competences
Reward and recognition
Affiliation
• Civil servants, outsourcers and contractors are mostly
complementary and orchestrated
• Transdisciplinary
• Continuous improvement
• Value for money
• Cognitive intelligence; design mindset; social engagement
• Area of expertise
• ICT is a specialist field
• LoBs use it to automate repetitive transactionsUse of ICT
• ICT is embedded in everday’s workflows
• Everyone use it as a cognitive companion
People: orchestrate the best available competencies
30
Virtual library
Lowers the barries of entry for SMEs and allows procurement officers to
purchase through shorter and smaller contracts to spur innovation
48%
49%54%55%
58%
64%
2013 2014 2015
UK CloudStore
% of total value of sales closed by SMEs
% of total # of deals closed by SMEs
31
Source: UK Cabinet Office, March 2016
5.336 4.783
14.759
17.606
9.591 11.517
13.863
16.292
11.155
32.255
11.807
16.352
IaaS PaaS SaaS Specialist CloudServices
UK CloudStore Average Deal Size (£)
2013 2014 2015
Secure your data
• Make security a business priority to protect data
• Architect for security to protect IT systems from
the inside-out
• Use predictive analytics to identify potential
threats before they occur
• When it comes to cloud, tackle issues at the
granular level by looking at: security, privacy,
compliance, transparency. DO NOT consider
security as one big black box
32
By 2018, government spending on cybersecurity
will go from approximately 2% on average to
over 5%.
Top 3 security priorities for Western European
government IT executives
Data loss/ leakage
prevention
Identity and access
mgmt
Mobile security
312Number of respondents = 275 governent IT executives in France, Germany, Italy, Nordics, Spain, UK
Source: European Industry IT Executive Survey, 2015
Get ready for the future
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Essential Guidance
1. Avoid arbitrary cost cutting. Get executive buy-in for business cases that
consider holistic value: constituent service, political outcomes and
operational effectiveness.
2. Reward ideas and nurture competencies in strategy, business analysis,
sourcing management, and program and portfolio management to unleash
innovation across process and technology silos.
3. Engage with the ecosystem. Explore new models of collaboration across
government departments and with non-profit and commercial partners.
4. Treat data as a strategic asset to enhance planning, service management
and operational decision-making
5. Make security a business priority.
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• IDC FutureScape: Worldwide Governments 2016 Predictions
• IDC FutureScape: Worldwide Smart City 2016 Predictions
• IDC Survey Spotlight: Western European Government IT Decision Makers
• IDC Survey Spotlight: Western European Government Perception of ICT Vendor Digital Transformation Offering
• IDC Survey Spotlight: Western European Government IT Security Priorities
• France: Government IT Executive Survey — Progressing Toward Digital Transformation
• Germany: Government IT Executive Survey — Progressing Toward Digital Transformation
• Italy and Spain: Government IT Executive Survey — Progressing Toward Digital Transformation
• Nordics Government IT Executive Survey: Progressing Toward Digital Transformation
• The U.K.: Government IT Executive Survey — Progressing Toward Digital Transformation
• Perspective: Western European Government ICT Pulse, October–December 2015: The Year of Digital Services
• Know Your IT Suppliers: Applying Strategic Sourcing Practices to Add Business Value
• IDC MarketScape: Worldwide Smart City Business Analytics Software 2015 Vendor Assessment
• Chargebacks: A Blessing or a Curse for Shared Services?
• Business Strategy: Government Digital Transformation: An Information Management Framework
IDC Government Insights research
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THANK YOU ! Questions ?
Max ClapsEMEA Associate Vice President
IDC Government Insights and IDC Health Insights
@Stormysummit
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