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Information Society development >Learning from success, avoiding the pitfalls
Andrew Pinder – 10 Jan 2007
Agenda
Introduction Common reasons for failure Gov3 Transformation Toolkit Specific challenges for Poland
1. Computerisation vs. Transformation2. Digital Inclusion3. Citizen Centricity4. Measurement and Metrics5. Risk
Suggested next steps for Poland
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Introduction
Gov3 > overview
Global strategy consulting business launched in September 2004 by the core team from the UK’s Office of the e-Envoy: 1999-2004: reported direct to UK Prime Minister with mission to
make UK a world-leading Knowledge Economy and e-Government
Gov3 is unique: we use our ‘inside government’ experience to advise and support
governments and international institutions on IT-enabled change consultants from over a dozen countries, including 4 ex-
Government CIOs In two years have worked with over 30 governments, plus the UN,
World Bank, EU and OECD
Australia Canada China Colombia Denmark Estonia Finland Greece Hong Kong India Ireland Italy Kazakhstan Korea Malaysia Mozambique Nigeria Romania Slovenia Sri Lanka South Africa Taiwan Thailand Turkey United Kingdom United States Australia Canada China Colombia Denmark Estonia Finland Greece Hong Kong India Ireland Italy Kazakhstan Korea Malaysia Mozambique Nigeria Romania Slovenia Sri Lanka South Africa Taiwan Thailand Turkey United Kingdom United States Australia Canada China Colombia Denmark Estonia Finland Greece Hong Kong India Ireland Italy Kazakhstan Korea Malaysia Mozambique Nigeria Romania Slovenia Sri Lanka South Africa Taiwan Thailand Turkey United Kingdom United States Australia Canada China Colombia Denmark Estonia Finland Greece Hong Kong India Ireland Italy Kazakhstan Korea Malaysia Mozambique Nigeria Romania Slovenia Sri Lanka South Africa Taiwan Thailand Turkey United Kingdom United States
Governments we have already supported Live pipeline
30+ countries
world-wide
In our first 2 and a half years, we have … …. worked with governments across the globe
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Common reasons for ICT investment failure
Common causes of strategic failure Using IT to reinforce existing silos rather than redesign services round
citizen needs
Spending money on technology before addressing organisational and business change
Lack of cross-government strategy for key building blocks of common data sets and common applications
Government-focused design of services, with little partnership with private and voluntary sector service deliverers
Failure to integrate eGovernment delivery with an effective strategy to build access to and demand for e-services across society
Failure to integrate eGovernment programmes with broader mainstream programmes of public reform
Common causes of delivery failure
Lack of strategic clarity
Lack of sustained leadership at political and senior management level
Poor understanding and segmentation of user needs
Lack of effective engagement with stakeholders
Lack of skills
Poor supplier management
“Big Bang” implementation
Failure to manage benefits
Failure to pro-actively manage the downstream benefits after an individual IT project has been completed.
Failure at a whole-of-Government level to undertake the restructuring of the public labour market to take advantage of new efficiencies OECD review found only 3 countries – UK, Canada and
Finland – had undertaken cross-government drive to realise the efficiency benefits of eGovernment
UK example: £18 billion pa savings 84,000 staff reduction (largely in transactional services and
corporate services) Allowing the government to invest in 250,000 new front-line
staff by 2008
+Bad strategy +
No critical mass of users
Wasted resources
Little impact on core public policy
objectives
Duplicated IT expenditure
=
NEGATIVE IMPACTS
Poor delivery
No management of benefits
Avoid making the same mistakes as other governments!
“We chose gov3 because they have a deep understanding from the inside of what it is like trying to drive change from within Government, with real insight and know-how on how to do
this successfully. We see it as a way to reap the benefits without having to commit the errors.”
Mikkel Hemmingsen, Danish Ministry of Science and Technology
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Gov3 Transformation Toolkit
The Gov3 Transformation ToolkitStrategy Delivery
Public Value
1 2 3 Benefit realisation
Transformedcustomer
experience
Lowercost
IncreasedGDP
Greater trust
Transparency
Governance Organisational Structures Governance Processes
Programme & project management Stakeholder management Risk Management
People: Skills and competences Pay and reward structures
Cor
e pr
oces
ses
Key
ena
bler
s
Technology: Service-oriented IT architecture
Outcomes
Customer research
User-centric methodologies for ensuring citizen and business input into all stages of planning and delivery
Building an operational model for citizen-centric service delivery:
business management channel management customer management
Service transformation: Process re-engineering Citizen-centric service
prototyping Service Delivery & Channel
Strategies
Back office transformation: Inverting the traditional model Simplify, share, self-service
Marketing / Communication Strategy Branding Campaign delivery
Portfolio management: Processes for revising
investment plans and priorities through the programme life cycle
Performance measurement: Monitoring Evaluation Customer feedback
Realising efficiency savings Turning efficiency into
cash Restructuring the public
sector labour market
Strategy Development: Current state assessment International best practice Gap analysis Scenario planning Strategic choice Vision, objectives, targets
Portfolio selection: Essential building blocks Services (G2C, G2B, G2E,
G2G) Legal and regulatory framework Ensuring “digital inclusion” Building the supply industry
Business case Development: Identifying strategic sources of
benefit Cost benefit analysis Quantifying public value
Five main challenges in Poland
1. Focusing on transformation rather than “computerization”
2. Addressing the root causes of Digital Inclusion
3. Citizen Centricity
4. Measuring the benefits
5. Risk management
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Specific challenges for Poland > 1. Computerisation vs. Transformation
Organisational assets 75%
Hardware 10%
Other ICT complements
15%
Source: Adapted from Brynjolfsson, E. “The IT Productivity Gap”, Optimize Magazine, Issue 22, July 2003 (http://www.optimizemag.com/issue/021/roi.htm )
Brynjolfsson’s Benchmark
Organisational change
55%
ICT 45%
eGEP ‘rule of thumb’ from set-up to full operation
Source: Case studies and interviews with experts
Computerisation vs. Transformation > ICT investment strategy “rule of thumb”
ICT + Transformation = Multiplier effect
Productivity:+ 20%
Productivity:+ 8%
Productivity:+ 2%
Decline, loss of productivity
ICT
inve
stm
ents
Organisational Transformation
No
Yes
No Yes
Source: McKinsey/London School of Economics
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Specific challenges for Poland > 2. Digital Inclusion
The legal, regulatory and fiscal framework
Government’s role as a market actor in its own right
Leadership to drive and shape the market
… but they achieve different impacts
Digital Inclusion > All governments use the same three core levers
By comparing Internet users and growth rates, countries fall into four different categories
Gro
wth
rate
of I
nter
net u
sers
Internet users as % of total population
Hig
hLo
w
Low High
Slow Starters
Digital leapfroggersDigital Leapfroggers Digital acceleratorsDigital Accelerators
Successful but Stalling
Digital Inclusion in Poland compared to EU countries
Source: Gov3 Digital Benchmarking Tool:
http://public.gov3.net/public_pages/limited/research/benchmarkin
g/gov3_digital_dashboa
rd.htm
Digital Inclusion in Poland compared to Southern and Eastern Europe
Source: Gov3 Digital Benchmarking Tool:
http://public.gov3.net/public_pages/limited/research/benchmarkin
g/gov3_digital_dashboa
rd.htm
A strong digital inclusion strategy has the potential to make even a laggard a digital leader
In 1999, before the UK Online initiative, the UK was lagging behind other countries in its benchmark group – it is now a global leader
Other countries have successfully moved from slow starters to digital leapfroggers and even digital accelerators
Gov3 has supported governments to launch Digital Inclusion initiatives in the UK, the USA, Slovenia, Denmark, Turkey, Thailand and India
Gov3 has identified a set of critical success factors for Digital Inclusion, which can be applied in a country to ensure that Digital Inclusion is successful the first time
Market enabling
Government as a market actor
Legal, regulatory & fiscal framework
€Access Confidence
MotivationI see real benefits from use of ICT which are
directly relevant to my life
I have easy and affordable
access to ICT
I have all the skills I need to use ICT,
and I feel trust and security using it
Community
Home Work
Voluntary & community
organisations
Digital content and
service providers
ICT vendors
CSF 1: Deep understanding of the digital market place, centred around the individual digitally-excluded citizen
Employers
CSF 2:
A holistic approach to all the drivers of digital inclusion : access, confidence & motivation
Public sector
CSF 3:
A cross-sectoral partnership approach to foster business model innovation and achieve scale impacts
Critical Success Factors include:
Communications Strategy
Digital Inclusion Strategy > Example of Scope
Education and
training
4
3Partnerships and Market Enabling
1Target initiative (e.g. Telecentres, Home Computing, etc.)
2Target initaiative (e.g. Student Computer Initiative, etc.)
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Specific challenges for Poland > 3. Citizen Centricity
Source: UK National Statistics Omnibus Survey, 2000-2003
% o
f Pop
ulat
ion
Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1
2000 20022001 2003
0
10
20
30
40
50
60
Buying online
Banking online
Government online
While governments have made some progress with online services, even the leaders are falling farther behind the private sector
The problem: traditional “e-government” is not citizen-centric
Thousands of government websites, all organised around structure of government not needs of customers
Confusing customers – with agencies competing to provide similar services
Replicating the offline offer, rather than exploiting the benefits of technology to create new value for citizens
Incoherent or inadequate branding and marketing
Absence of systems to learn about the customers government do have, so they can offer them targeted services
Putting a portal on top of this does not help!
Benchmarking citizen-centricityUser experience
Hong Kong
Directgov Firstgov
Government of Canada
Take-up trajectories for US, UK and Qatar portals
0
10
20
30
40
50
60
70
80
2001/2 2002/3 2003/4 2004/5 2005/6 2006/70
5
10
15
20
25
30
35
40
45
Quatar US UK
FirstGov UK online UK online (forecast) DirectGov Qatar e-Government
Internet users
Portal users
Internet users per 100 population Portal users per
100 population
DirectgovFirstgov
Qatar eGovUKonline
Gov3 insights
It is easy to build a portal that won’t work There is no shortcut to citizen centricity Learn the right lessons from the countries that have
done it before Global business is customer-focused – and on the
Internet, global business sets the standards A citizen-centric approach is critical
Knowing what your users want is essential
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Specific challenges for Poland > 4. Measurement and Metrics
Government “Measurement Momentum” is mounting…
After several years of sustained investments in ICT by governments the measurement agenda is rising in importance worldwide and particularly in Europe
This is not surprising given the sheer volume that ICT expenditure in public administration is reaching
For instance, according to the EU sponsored eGEP study, in 2004 the total General Public Administration ICT expenditure in EU25 reached about € 36.5 billions (see Figure), of which about € 7.5 billions for hardware
Hardware 20.5%
(€ 7,5 bln)
Software 18.7%
(€ 6.8 bln)
Services 31,6%
(€ 11.5 bln)
ICT Staff 20.0%
(€ 7.3 bln)
Communication 9.3% (€ 3.4 bln)
Source: eGEP 2006 (www.rso.it/egep)
Public Administration ICT Expenditure in 2004Total € 36.5 billion
Multidimensional measurement: ICT investments can generate much greater value than can be captured by simple ROI metrics
One-dimensional financial metrics reflect only the most straightforward and low level direct cash and operational results, and are inadequate to reflect the deep strategic values that ICT can generate
Total Cost of Ownership (TCO) is a clear advancement compared to simple financial ROI, but still does not capture the full costs and benefits of ICT
Recently several governments have issued more comprehensive multi-dimensional measuring methodologies to fill this gap and, in particular, the European Commission eGEP study has put forward a new multidimensional eGovernment Measurement Framework (eGMF)
This multi-dimensional approach, has been further refined and is used by gov3, which is based on several type of both quantitative and qualitative metrics…
…four type of metrics for multi-dimensional measurement
Hard cash value, measuring short term savings in terms of avoided costs
Potential monetary value, assigned to impacts mostly deriving from increased employees’ productivity
Volume metrics, used to measure impacts for which is not possible to assign a monetary value, but which can measured in numbers (for instance “decreases in numbers of security breaches”)
Qualitative scores, assigned to strategic impacts (for instance “contribution of an IT investment to agency capacity to meet national policy requirements”)
Multi-dimensional measurement: fully grasp the costs of delivery and organisational change
Costs are the other side of the equation of measurement, though they often receive less attention than benefits
The analysis of costs must also be multi-dimensional and include both tangible and intangible costs
Understanding costs is important also to measure benefits, since the analysis of cost help define the baseline against which benefits are assessed
The best way to fully grasp costs is to adopt the Activity Based Costing, a methodology gov3 has tailored to the specificities of ICT and eGovernment projects
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Specific challenges for Poland > 5. Risk
Based on what we know about the program so far, it scores at 90 on our Barometer: very high levels of intrinsic risk.
The Gov3 Risk Barometer is not a replacement for a detailed risk assessment - but it does give a broad sense of how difficult what you are trying to do is when compared with international benchmarks, and the intensity of the risk management processes which you should ensure are in place.
Try a self-assessment on the Gov3 Risk Barometer at http://public.gov3.net/public_pages/limited/consulting/gov3_barometer.htm
ICT development in Poland has very high levels of intrinsic risk
Total Estimated Score on the Gov3 Risk Barometer = 90
Such programmes are likely to be “mission critical”, and need to manage significant levels of complexity across organisational boundaries. Particular attention should be paid to: - securing pro-active, ongoing leadership of the program at Ministerial and senior official level - ensuring effective governance and stakeholder engagement processes - securing regular external review of program progress and risk status
Gov3’s approach to Strategic Risk Management A 5 step process
The Gov3 Risk
Barometer: an initial
assessment of intrinsic
risk
Identify current
risks
Prioritise the
critical risks
Develop risk
mitigation plans
Implement risk
mitigation plans
2
3
4
5
1
Stra
tegi
c cl
arity
Leadership
Stakeholder engagement
Skills
Do-ability
Supplier partnership
Benefit realisation
Use
r Fo
cus
S t r a t e g i c c l a r it yBenefit realisati
on
U s e r F o c u s
Strategic clarity
User Focus
Leadership
Stakeholder engagement
Do we know who our key stakeholders are, internally and externally? Do all our key stakeholders have a common understanding of the programme? Are these key stakeholders on our side? Do we have robust processes for ensuring that key stakeholders remain supportive
throughout the programme?
Is it clear which individual is responsible for delivery of the overall programme, and which individuals are responsible for each key element?
Do we have the authority we need to deliver this programme? Do we have the leadership skills we need? Does our leadership team have access to external support? Do we have effective governance structures, processes and levers?
Do we know what priorities our citizens, businesses and staff have for e-services? Can we measure user satisfaction? Do we have robust mechanisms to ensure user feedback into every stage of service design
and delivery?
Do we really understand what it is we are trying to do, and are our outcomes clearly linked to the government ‘s strategic priorities?
Do we fully understand the Strategic Business Case for the programme? Do we know how we will measure success? Do we have a clear set of priorities, informed by real understanding of how costs,
benefits and risks vary across different aspects of our programme?
Step 2 > Gov3 Strategic Risk Checklists
Stra
teg
ic
clar
ity
Benefit realisation
Use
r Fo
cu s Do-ability
Skills
Supplier partnership
Benefit realisation
Do we have a benefits realisation plan for each outcome targeted by our Strategic Business Case? Are we managing that plan effectively? Do we have staff retraining and redeployment plans in place to ensure that we can turn potential
efficiency savings into real cash savings? Do we have robust mechanisms to ensure that successful outcomes will continue to be achieved
when our change programme is closed?
Do we have a delivery plan, mapping out key dependencies, risks and the critical path?
Have we done all we can to de-risk delivery through phased implementation? Do we understand the organizational changes we need to deliver? Are we making technology choices which give us maximum future flexibility? Do we know when we should halt a failing project?
Do we have the programme and project management skills we need? Do we have the delivery skills we need – covering change management and service
transformation, not just technology? Have we effectively integrated the different skills sets into an effective team?
Do we understand the supply market-place, and are we confident it is able to deliver what we want to achieve?
Are we selecting our suppliers on the right basis (including full life cycle costs and benefits, not just initial price)?
Are we able to operate effectively in partnership with our chosen suppliers?
Step 2 > Gov3 Strategic Risk Checklists
Purpose: To reach a common agreement on which of the identified risks
are the most critical
What we are going to do: Break out into two groups, to map each risk identified in Step 2
onto a Risk Prioritisation Matrix
Step 3 > Prioritise the risks
Impact
Medium
Low
High
Low Medium High
Prob
abili
ty
1
2
3
4
5
6
8
97
Step 4 > Risk mitigation
Deliverable: a top-level risk mitigation plan: Who should own this risk What mitigation actions should be taken Timescales for next steps
Then manage the risks, not the Risk Register …..
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Suggested next steps for Poland
Suggested next steps for Poland Health Check: The government should consider running an outside “health
check” of the initiative to review what has been done to date and provide concrete recommendations for correcting the initiative.
Build capacity: In order to successfully take this forward, it would be helpful for the government to build its capacity to deliver e-government and information society initiatives. This could be done in-house or working with a partner, but in either case it is essential that the government work with people who have a track-record of delivering similar programmes in government.
Portfolio Optimisation: It could be helpful to re-think the programme portfolio so as to ensure that the main action lines will deliver on the stated goals of the programme. This “portfolio optimisation process” would include the examination of initiatives based on strategic fit, user benefit, government benefit, and do-ability. The process would also balance early benefits (or “quick wins”) with longer-term benefits, costs and risks.
Detailed Roadmap: Would be useful to develop a detailed roadmap that delineates actions in the short and medium-term, and what exactly needs to be done in order to ensure that the programme delivers on its stated goals.
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Thank You - Discussion