Are you Ready for Government 2.0?

There is a growing discussion regarding government and public sector innovation. Having been involved in running a public hospital during a major healthcare reform period for the last couple of years, I can say that innovation is more than needed in public services.

Let’s see why this is.

Drivers forcing governments to innovate

Aging population

Thanks to declining fertility rates and improvements in healthcare, as much as 20% of the developed world’s population will be over 65 years old by 2020. Having fewer working people that need to support a growing segment of seniors, is already causing significant implications in most countries. An aging population and the exponential advancement of technology is also putting many nations on a global contest for skilled technical talent. Aging is pushing governments towards healthcare, pension and educational systems transformations.

Urbanization

Asia is already home to nearly two-thirds of the world’s middle-class consumers. UN also predicts that half of them will live in urban areas. Cities are expanding their limits and tranforming to huge urban agglomerations, or “megacities”. These global hubs will eventualy become autonomous and compete globally for attracting talent and wealth.

Urbanization and rising standards of living is already putting increasing pressure on earth’s scarce resources by affecting climate change. Some also believe climate change will eventually restrict our access to natural resources including food, water, land and energy. The UN predicts that nearly 1.8 billion people will live in regions with absolute water scarcity over the next 10 years. Water scarcity could drive a continuing transformation in industrial production. Urbanization is pushing governments to rethink national policies concerning the usage, sale and ownership of natural resources.

Internet of things

Social networks, cloud computing, sensor technologies, robotics and artificial intelligence will lead to a greater level of disruption in nearly all sectors and impact the development of hyper-connected, global citizens. What does this mean for citizen engagement?

Fiscal constraints

Throughout the industrialized world, national and local governments face the future in a context of deficit-reducing budget cuts and a global government debt estimated at $60 trillion (some say even $120 trillion if we factor pension liabilities in).

Income inequality

More than two-thirds of the world’s adults now have wealth of less than $10,000, while the wealthiest 0.7 percent holds 41 percent of the world’s wealth. An aging population, rising unemployment and skill gaps are the main reasons why global income inequality still rises. What do governments have to do to close this rising gap?

These five drivers are rapidly changing the rules of the game. Public services have to address an aging population and hyper-connected citizens that are moving into megacities demanding more personalized solutions. And they have to do that during a global recession and being heavily indebt.

The future of government is tied with public officials’ ability to stay current, be responsive and evolve in order to create new value. In other words, innovate.

So what is innovation, anyway

Innovation is a term that, similar to the term “change”, describes both a process and an outcome. It’s so difficult to define what innovation is, that there are at least 20 available definitions. Despite starting from different perspectives, most definitions agree that innovation is non-linear. It doesn’t have a starting point or a clear sequence of steps.

My understanding is that innovation is the deliberate act of exploring the boundaries of organizational capabilities. Steve Jobs in his famous commencement speech talked about connecting the dots in order to envision the future. He said “…you can’t connect the dots looking forward; you can only connect them looking backwards. So you have to trust that the dots will somehow connect in your future”. I think what he was asking from his audience was to always explore the possibilities by recombining the available to them resources. It is also important to distinquish innovations from inventions. Inventions are product developments. It’s inventing the diesel engine. Innovations are to find out what to do with the diesel engine to create value.

Collaboration is key

For governments to innovate, they need to develop a variety of competencies and learning structures. And they can’t do that without opening up to public-private partnerships and increasing citizen engagement.

Citizen engagement

Citizens are now hyper-connected and accustomed in getting instant and personalised solutions. But most public services use a “mass provision” model ultimately aiming to fit services to the citizen, rather than vice versa. It’s no wonder that citizens demand more.

Citizen awareness remains a powerful force for change. Greater awareness regarding their rights, better access to information through technology and higher expectations of service levels have become embedded in many countries. Citizens are expecting quicker delivery and more individualisation of services in today’s ‘hi touch’ society that values personal experience. Sustainability is no longer a ‘nice to have’, but a ‘must have’. And at the same time, citizens are demanding more visibility on the allocation of public resources and challenging governments to be more efficient and equitable through accountability and transparency.

Public-private partnerships

The idea of public institutions partnering with the private sector has emerged over the years as a way to collaboratively solve societal problems. To be precise, such partnerships have been around for at least 200 years. What is different now is that instead of focusing solely on large infrastructure projects, these partnerships are increasingly expanding their scope into more complex civic challenges. In most cases, what the private sector brings in the table is funding, technical expertise and channel access. Public sector on the other hand, offers market and data access.

Directions for action

Following on the challenges driving government innovation and the core dimensions of a government innovation strategy, let me suggest three areas where governments should direct their efforts and transform from merely a service provider to an enabler of network collaboration.

Shared services

The future government must find ways to share funding and resources among many different public service institutions.

Data interoperability

In order to take advantage of technological advancements, future government should ensure that it produces data systems that work interchangebly along with other systems with limited if none restrictions.

Co-creation of public value

Borrowing the notion of co-creation from the private sector, governments should invest in co-creating services with citizens or other civic organizations. That means allowing public services users to participate in the design, management, delivery or evaluation of these services.