Public Sector Managers are facing some of the biggest challenges of their careers, as the combined impacts of 'Austerity Mark 3' demands 35% cost savings over the next few years, political uncertainties with Brexit, geographic aggregation and rising citizen expectations. This is even before one layers on the accelerating technology megatrends to deal with. One thing is certain - that we had all best embrace constant change; the question is how do we shape and drive desired changes?
Often Leadership is about empowering change - and for this we need to change our thinking. The organizational approach to achieve incremental change is completely different from that with the goal of achieving transformational change. But here the language can get in the way unless we define terms. In my book, "Transformation" is unlikely to be consider to have been achieved unless a sustainable improvement of at least 50% in one or more of costs, quality or speed is achieved, when viewed holistically.
Let's not kid ourselves that taking an existing paper process and making it digital is automatically 'transformational'. It may be, or provide the springboard to enable such, but replicating processes designed for one medium and age in another format does not by itself optimize modern productivity and experience possibilities.
However in the same time to achieve a successful digital transformation, there may have been dozens of smaller incremental change projects which could potentially have a similar impact. So we must be both ambitious and SMART in our goal setting. Then professionally project manage. This starts with a customer first agreement on business requirements across all stakeholders. Suppliers may be used as catalysts for commencing dialogue about future possibilities, but gaining such agreement needs internal change agents (whether formally or informally tasked as such).
With every project, more transparency over the true TCO of the end-to-end process, both before and after, is needed. This is something where there is scope for much more proactive use of audit results and sharing of best practices.
Digital transformation changes business processes and models. A classic ROI calculation works for single digital initiatives, but not for shifts in business models. Digital investments aimed at disruptive change across the enterprise challenge traditional ROI calculations. Attributing benefits like customer satisfaction or enterprise productivity to a single digital investment is difficult in the context that so much of digital transformation impacts are cumulative.
We must learn to value change investments through the eyes of our service users (a.k.a. citizens and customers) and then see that the real value relates to increases in long-term productivity and/or engagement, not short-term technology project ROI. ‘Positively disruptive’ transformational change is difficult as it can rarely be won without involving non-IT staff, users and third parties.
Having worked both on Client and Supplier sides of 'technology-based business change', I know how vital it is to gain real alignment of interests form all parties. This needs to be not just words and warm feelings, but in the commercial arrangement internally and externally. Unfortunately, whilst we offer aligned terms, we rarely see true risk-reward sharing contracts across the public sector. This is in part due to restrictions on how benefits can be measured (such as a 50% reduction in work time to complete the same tasks being unable to be counted in a financial investment case) and in part due to a lack of boldness of leadership to realize the highest scale of digital transformation. For those bodies that can grasp the nettle, Austerity Mark 3 budget reductions for administrative processes may be successfully managed.
Author: Chris Jones, Managing Director, Icon UK
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