Thursday, January 09, 2003
A leap of faith, to make e-government worthwhile
I was as surprised as anyone (and, believe me, there were a lot of surprised anyones and even one or two surprised someones) to see me mentioned in Mike Cross' article in the Online section of today's Guardian. Mike was pondering whethere e-government is worthwhile. Mike gets to the nub of the problem - that pretty much every country is seeing - which is that today (at least) e-government is just another channel (squashed on top of many others - phone, mail, fax, face to face, intermediary etc). This has resulted in some hefty expenditures and difficulty translating those into saves. Oddly, Mike singles out Singapore and the US as being particularly good at e-government - the former very probably, the latter not so (some states have made awesome progress, but at a total level not so good I think). As Mike says, when it's the right service - flood warnings online as opposed to VAT it seems - people want it and they want it when they want it (which leads to sudden peaks, which are hard to deal with as we know the Environment Agency found). He wraps up using the motto that I have at the left of this page and wonders whether you have to justify e-government as a leap of faith. I'd planned to change that motto this weekend, so you won't see it much longer (it stays on the pages in the archive), but this is what Mike said "In the end, the sensible justification for e-government must be a combination of [improvements in efficiency, convenience and quality of these public services]. Or, like Alan Mather, head of delivery at the Office of the e-Envoy, you can justify it as an act of faith. In his personal blog site www.diverdiver.com/egovblog.html (cult reading for e-government enthusiasts) Mather says: "E-government isn't any different from government. It just might make it better, sooner." and closes with "Whether that's worth £1 billion remains to be seen". Oh, and he also describes this page as "cult reading for e-government enthusiasts" - I appreciate that, but would add that it only makes for cult reading when combined with the pages of the luminaries that I link to. If you're a regular reader or if you browse my archives you'll see that I often return to the "better, cheaper, faster" logic of online services and talk about the things we have to do to get there, whether it's better content delivery, more logical navigation, streamlined transactions or partnerships with intermediaries to deliver value-added services. At pretty much every conference I have presented at the question of "return on investment" comes up pretty quickly - whichever country you are in (so far, the ones to ask fastest are the smaller countries who have less to spend initially). It came up at the first conference I did in June 2000 and it's come up every time since then. My answer to how you get to the point where you have a return hasn't varied much. I scare people by talking about the hump costs they're going to see - and there are many humps to be seen. I use the evolution graph below to illustrate my point. As you progress through each stage, you bump up against new costs (for technology, system replacement, change management, business education etc). When I put the graph up, I expected us to hit a new stage roughly annually until 2005, by which time we'd have enough experience, infrastructure and services online to start really transforming government. That means that true benefits probably don't occur until after that. If you look at the names of the companies that I added to some stages, you get a sense of who has already done some great things and that they are already getting saves - Dell, as the perfect example, has taken a physical delivery model and used technology to an enormous degree to drive costs down to levels at which other players cannot compete, and hence has landed at the top of the tree. A while ago I had dinner with Michael Dell (there I go, name dropping again) and I asked him about how the move to the web had gone. He said that with the first website there were no cost saves - people used the site to find out the basics and then asked ever more detailed questions to the telephone operators, meaning that more operators were needed and so costs went up. That was 1997. Other companies are doing siilar things - Ebay could not exist without the web, ditto Egg. Amazon hasn't been able to do what Dell did yet, different control factors and so on (ditto Tesco I think). Given that it does cost money to do all this though, there are ways for it to cost less - My "seven stops" for e-government speech based on what I said in Romania is one way. If we don't expect every bit of government to solve the same problems, build the same widgets, suffer the same pains, then we can save money through collective learning. So, the saves come in perhaps the third section, or more likely the fourth. Until then, there probably isn't enough mass to generate meaningful saves. With 60% of the UK using the web now, there's a lot of clients you can impact directly. The 40% who don't use the web can still go through intermediaries who do use the web - so they don't necessarily have to be web users to get web benefits. But this all takes time, focus, energy and above all, for now, a pretty substantial leap of faith. For me, it's faith that I can make a difference. For some it might be faith that investment here will produce a long term return that improves GDP. The hard numbers, the proof, just aren't there yet. You don't, after all, get two chances to leap a chasm. I just hope that I'm not right over the middle of that chasm now.
Posted by Alan at Thursday, January 09, 2003