With budgets shrinking and citizens looking to interact with government via their preferred channels, the move to a digital public sector is both underway and accelerating. Caroline Cook, from Capgemini Australia’s Marketing, Sales and Service practice highlights the benefits, risks and possible approaches that governments can take to be smarter when ‘going digital’.

Historically citizens have interacted with government in a prescribed manner; usually via the face-to-face and telephone channels. Yet, over the past decade the public sector has moved to engage citizens via the web and, more recently, via social networks and mobile applications. Given the wide-spread take-up of high-speed broadband, always-connected smartphones and social networking by citizens; eGovernment appears both achievable and sensible, and has become a strategic objective for many governments worldwide.

The benefits of ‘going digital’ for the public sector are significant, with slight variations across departments and agencies:

  1. Reduced cost to serve online service is considerably cheaper to provide on a ‘per interaction’ operating basis than that of the telephone or face-to-face channels; email communication is more cost-effective than paper mail; and social networks offer an affordable means to capture public opinion, which was previously only possible via expensive focus groups and public consultations on a much smaller scale.
  2. Avoiding future spend – digital platforms such as mobile apps and social networks allow citizens to ‘push’ real-time data to government; capturing feedback which can be acted on immediately to avoid a big bill in future. Apps have been developed so that citizens can report potholes, broken street-lights, and alert law enforcement to the whereabouts of criminals; while technologies enabling real-time health monitoring via smartphone are not far away. In both instances, providing this data to government allows preventative action to be taken which could significantly reduce (or remove altogether) future costs.
  3. Improved public perception – for customers  who use digital devices and platforms regularly, the ability to interact with government via eChannels is highly convenient, and eGovernment is indicative (correctly or otherwise) of a public sector that is willing to engage with citizens on their own terms. Either way, digital public services are likely to positively impact perceptions of government.
  4. Improved compliance – in the taxation domain particularly, the ability to engage with the public over digital channels is likely to have a positive effect on citizen compliance. Although it is highly doubtful that the behaviour of the intentionally non-compliant will be changed; there is a strong case that digital services reduce the volume of citizens who are inadvertently non-compliant – improving cash flow, avoiding collection costs and reducing debt on hand.

While these benefits are considerable, on the flip-side, there are a number of risks if governments turn to digital technologies without careful consideration:

  1. Digital exclusion – in most developed countries broadband and smart-phone usage has never been higher, however, in very few has it reached 100%. Governments serve a very broad range of demographics compared to private-sector organisations, and many services – particularly with regard to the Welfare domain – are delivered to the groups of citizens that are least likely to have access to the internet. In these circumstances, moving to digital channels can be counter-productive and high risk, even more so if traditional channels are rationalised in parallel.
  2. High capital expenditure – moving to digital channel interactions can represent serious investment, particularly where large web sites need to be migrated, consolidated or developed. If bespoke legacy IT is in place, it is also likely that the development of interfaces and data exchanges will be complex and costly. European Commission data shows that in 2003, a number of EU nations (UK, Sweden and the Netherlands) were spending close to 8% of GDP on ICT investment.
    Although such investment generally has a life-span of about 15 years, there is evidence to suggest that there is no direct correlation between the sophistication of digital services and take-up; rather it is cultural factors that drive adoption. Given the high-cost associated with true digital transformation in government (particularly for large, complex departments), if adoption levels do not keep pace with investment (i.e. citizens continue to use channels with higher operating costs) there is a real risk that such projects may not break even.
  3. Digital is not a homogeneous channel – unlike face-to-face and, to an extent, telephone channels, the digital landscape is incredibly diverse and incorporates one-way (static online), two-way (email, online forums) and real-time (co-browse, chat) interactions, as well as platforms that blend all three (apps and social media). This diversity creates complexity when implementing digital in government due to the range of services offered and demographics served. Unlike traditional channels which generally involve real-time interaction (paper excluded), digital channels suffer from lower satisfaction if they are not implemented carefully and in line with their specific strengths.

Bearing in mind the potential risks and benefits associated with digital channels, there are a number of considerations that public sector organisations must make when designing and implementing digital services, or managing their channel portfolios. The list below is not exhaustive, but can be considered a starting point:

  • Avoid mandating digital channels, or rationalising traditional channels, until very high take-up is assured – forcing customers to use digital channels if they are unwilling, or unable, to do so will result in poor experience, increased complaints (which themselves are costly to process) and increased pressure on any traditional channels that remain in place.
  • Ensure that digital channel adoption will deliver adequate total cost savings – if analysis indicates that digital channels will be adopted by customers who are of low cost-to-serve, capital expenditure costs must be considered as part of any digital channel business case. Where total cost of ownership is likely to exceed operating cost savings, digital strategies should be re-assessed.
  • Consider traditional channel optimisation where high-cost customer groups are unlikely to transition to digital channel offers – if there are barriers to digital take-up for high cost-to-serve customer groups, it may be more effective to optimise traditional channels (such as contact centres) in terms of net benefit. Technologies such as biometric voice recognition and sophisticated queue management systems, along with operational transformation such as process improvement, can significantly reduce the cost-to-serve associated with traditional channels.
  • Investigate internal operational cost savings that can be achieved through the use of digital channels – while digital channels can reduce the cost of citizen interactions, they can also be harnessed to reduce internal operational costs. Tools such as professional social networks, browser based work-flow management and apps for staff (especially where a proportion of the workforce is mobile) can drive significant cost savings for a large organisation.
  • Design digital usability by benchmarking “best of breed” tools – staff and citizens alike will assess any digital tools, initiatives and channels against private sector benchmarks. Search functions will need to reflect the speed and accuracy of Google, mobile applications should be comparable to the most user-friendly smartphone apps, and web portals must be as easy to access as an online banking system. Digital channels should be quicker and easy to use than traditional channels (e.g. online vs paper-based forms) and help should be easy to find and use if needed. Privacy and security are also of the utmost importance and should be carefully considered.
  • Select digital channels based on interaction complexity – as mentioned previously, the range of tools, technologies and platforms that make up digital ‘channels’ are extremely diverse, each best suited to specific types of interaction. Given that the public sector interacts with citizens in many highly diverse ways (from updating a driving license photograph, to applying for student finance, to medical treatment), digital channel strategies should ensure alignment between the tool or platform, and the overarching customer need. As an example, search tools, apps or forums are unlikely to support complex interactions as effectively as online co-browse.
    It must not be forgotten that there are many highly complex public services that can only be delivered via face-to-face or telephone channels.

Despite the potential pit-falls and the level of consideration that is required when developing digital channel strategies in government, the potential cost-reduction benefits are profound. And, although it isn’t appropriate (just yet) to mandate digital interactions or rationalise traditional channels; the opportunities to move beyond the realms of static web-based information to interactive digital experiences should be taken very seriously by government. What is clear, however, is that government should not “go digital” until there is a clear and precise understanding of who its customers are, which devices they use, whether they will move to digital tools, and which digital tools are best equipped to interact with them.