www.gov3.net

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