It’s OGP time next week in London. With some discussions leading up to the big summit, including the one storifed below. The critical challenge for OGP countries and civil countries is closing the gap between commitments and implementation results. Followed by making the information useful – perhaps transformational. Of course, there are political incentives for “looking good” by signing up for OGP. Yet, there is political risk when more government information is transparent.
Developing countries are adopting processes and technology designed to increase citizen trust while leveraging citizen and civil society cognitive surplus to improve public policy. If the Arab Spring, Tea Party and the Occupy movement has taught governments anything it’s crowdsource to improve public policy – or be crowdsourced.
Auditing is expensive. Very expensive in developing countries. That’s why citizens, civil society and businesses are encouraged to help governments. For example, there is nothing better to uncover procurement fraud or poor procurement decisions than competitors.
As I’ve pointed out before, performance management in the public sector is more complex than in the private sector. Private sector organizations have a bottom line: profit. There are established measurements like market share, and return on assets. Output measurements like the number of customer complaints handled, and outcome measurements like customer satisfaction survey ratings are factors that influence financials – profitability. If all the KPIs are green and the company is not making a profit, than the indicators are likely incorrect.
There is no bottom line in government. Outputs and outcomes are the results. Financial – in this case, budgets, is the input. This makes it very difficult to determine whether the KPIs are correct. There could be false positives and false negatives.
Social media in government, or Government 2.0, can engage citizens and civil society to report on outputs or outcomes. For example, the Ushahidi platform is used to monitor elections, disaster response and corruption.
The next stage in citizen engagement is crowdsourcing through expert groups or the public. This shows promise when managed correctly. For example, an effort at the White House generated some unexpected ideas. The principle of using citizens to propose and vet solutions reduces the burden on governments and may generate ideas to solve important problems.
Participatory Budgeting to go virtual?
Participatory budgeting is a process originally developed in Brazil to engage citizens to improve budgets. Adoption of participatory budgeting has grown particularly at local government. My sense is that the immediacy of service delivery in local government can create a critical mass of participation. The use of neighbourhood and civil society meetings and government outreach may not be sustainable in large regional governments and many national governments.
There is some sensitivity in governments to crowdsource policy because policy is considered the purview of political wonks. There is a notion of budget confidentiality in Canada that may restrict the kind of openness enjoyed in developing countries.
Open Government Costs
Many argue that open government, social media, crowdsourcing etc. just costs money. I’ve summarized the business case for open government in a previous entry. A recent Transparency Camp Brainstorm identified the following benefit categories for open government:
Revenue, primarily in the form of increased tax collection through increased economic activity
Efficiency, effectiveness and productivity through reduced cost per unit of work including cost avoidance
Outcome improvements such as achieving higher levels of service delivery or improved health statistics
The resistance to social media and open data in developed nation governments contrasts to the attitudes from many developing countries. I find a greater acceptance of the value proposition of open government in countries like Timor-Leste, whose transparency portal is an amazing achievement, than in G8 countries. The commitments for the Open Government Partnership show that these countries are innovating beyond expectations. This could result in a more engaged population with a deeper form of democracy than we enjoy in Canada today.
As I’ve written before, social media will be transformational for Public Financial Management. The key driver in developing countries is the need to sustain reform. This doesn’t mean sustaining the PFM “status quo”. Or, tweaking processes. This means continuous modernization and reform. Catching up to developed countries. Leapfrogging developed countries. This effort requires citizen engagement.
Let’s hope that governments at all levels in Canada do not hold back and get leapfrogged.
Yet, isn’t “government performance management” too complex for developing countries? Not necessarily – as we have seen in Timor-Leste where performance dashboards are used and government results provided to the public.
Advantages in Developing Countries
There may not be sufficient capacity in some governments to fully leverage budget-centric performance management tools. But there are advantages:
Centralized information: Developing countries tend to have fewer information systems with more centralized systems. Data from sub-national entities is more accessible. And, governments in developing countries are more likely to support public sector and information technology standards to facilitate data collection
Holistic understanding: Managers in developing countries look at performance and the nature of government in a more holistic way that those in the “West”. Performance Management tools differ from traditional Business Intelligence through a holistic view of performance. In particular, Ministers and senior managers are attuned to macroeconomic effects like commodity prices.
Development effects: The impact of improved performance is more significant in developing country. Government performance improvements positively affects development results, business confidence, investor Investment, aid effectiveness and remittances.
Competitive differentiation Improving government performance has a more significant impact for developing countries in the global economy. Governments are more motivated to improve “doing business“, “revenue watch” or “open budget” indexes to create a better business and development environment.
Timor-Leste has achieved “comprehensive” extractive industries revenue transparency
Transparency is Aligned to Performance
The key first step to government performance management is transparency. Transparency is one of the measurements used in international government performance assessments like Public Expenditure and Financial Accountability (PEFA):
B. KEY CROSS-CUTTING ISSUES: Comprehensiveness and Transparency PI-5 Classification of the budget PI-6 Comprehensiveness of information included in budget documentation PI-7 Extent of unreported government operations PI-8 Transparency of inter-governmental fiscal relations PI-9 Oversight of aggregate fiscal risk from other public sector entities. PI-10 Public access to key fiscal information
Transparency is more than a superficial step to government performance, as these videos from the Open Government and International Budget Partnerships describe. Transparency motivates accountability which improves performance.
They represent, in my description of it, what happens to a business when a major change takes place in its competitive environment. A major change due to introduction of new technologies. A major change due to the introduction of a different regulatory environment. The major change can be simply a change in the customers’ values, a change in what customers prefer. … But what is common to all of them and what is key is that they require a fundamental change in business strategy, and that’s almost a definition of a Strategic Inflection Point. A Strategic Inflection Point is that which causes you to make a fundamental change in business strategy. Nothing less is sufficient.
This is a strategic inflection point for the way that governments manage information technology and the way in which software vendors support governments.
This “double dip” strategic inflection point is driven by:
Innovation Necessity: Budget constraints at a time of citizens demanding improved government performance and transparency at lower cost.
Value, Risk and Innovation Paradigm: Traditional methods to understand value have become obsolete in the age of social media.
Digital Darwinism: IT agility challenges incumbent Government IT providers.
The Metamovement is a movement of movements. Not all these movements are similar; no two are exactly like; each can be readily distinguished from the next. The Arab Spring is part of the Metamovement; the London Riots were part of the Metamovement; protests spreading across America, under the banner of Occupy Wall St, are all part of the Metamovement.
The Metamovement questions institutions. It demands a change in the status quo of how governments interact with citizens. This has a huge impact on policy and regulation. This is manifested in a demand for improved transparency through Government IT.
Takeaway for Government IT: the government performance and transparency demand is a cornerstone of the Metamovement. Initiatives like the Open Government Partnership is likely the “end of the beginning” for open government data. IT information silos, proprietary technology and focus on IT “control” in government inhibit the ability for countries to respond effectively to citizen demands.
2. Value, Risk and Innovation Paradigm
Government IT decisions tend to be risk-adverse. Small steps are taken, primarily with incumbent software vendors. Yet, this can create an environment that limits innovation and cost savings through what former American Federal Government CIO Vivek Kundra calls “IT Cartels.” This can result in attempting to find cost-savings through legacy technology“economies of scale” when modern technology can generate technology can generate more agility while reducing costs and aligning performance with budgets.
Moore’s central premise in this well written, actionable and highly recommended book, is that companies have a structural bias for investing in things today that cause it to starve out the new products and services that will generate growth in the next 2 -3 years.
My sense is that this “starving out” reflects Government IT and incumbent vendor approaches to innovation.
Takeaway for Government IT: there needs to be a new approach to risk & results in increasingly transparent world. The Metamovement does not demand tweaking. It does not want a 10% improvement. Traditional approaches to risk in Government IT have become increasingly risky because it is almost certain that these approaches will not result in what citizens want.
The reality is that we live and compete in a perpetual era of Digital Darwinism, the evolution of consumer behavior when society and technology evolve faster than our ability to adapt.
Nothing today is too big to fail nor too small to succeed. Disruption not only faces every business, its effects are already spreading through customer markets and the channels that influence decisions and behavior. What works against you also works for you. And, it is what you do now that defines your ability to compete for today and the future. You already recognize the importance technology plays in your business. That’s why you’re here. But recognizing the difference between emerging and disruptive technology and measuring its impact on your business, customer relationships, and products is a necessary discipline to successfully evolve.
Solis also connects the Metamovement with this change in IT in video trailer.
For the next generation of knowledge workers, entering the workplace often feels like entering a computer science museum
Takeaway for Government IT: There are significant limits to innovation among many Government IT providers. Make no mistake, governments will innovate the relationship with citizens. The key is that Information Technology should enable these changes. Old models, legacy technology can ensure that ‘big’ will fail.