Nous Group recently hosted the Public Sector Network’s Digital Government Roadshow across Australia; the following insights arose from the discussions.

Rapid shifts in citizen expectations and behaviour – such as increased use of the sharing economy and confidence in digital channels – are increasing pressure on government to improve service experiences. Consequently, all jurisdictions and levels have now accepted the need for digitally-enabled service innovation, including to improve efficiency and reduce cost.

Although real progress and momentum is occurring, the pace and scale of change, as well as constraints unique to government, still present significant challenges.

Constraints unique to government hamper digital innovation

Challenges unique to government that make it hard to digitally innovate at the speed citizens and finance departments expect include:

• Privacy and security concerns: citizens have low confidence in governments’ ability to offer secure digital channels, but expect agencies to deliver service innovation at scale
• Difficult funding environment: government funding constraints, cycles and reporting requirements are at odds with the process of starting small then building, iterating and scaling up that promotes low-risk success in digital innovation
• Knowledge of, and access to, the right skills and resources
• Competition for specialist skills with the private sector, which typically has more freedom in what it can offer to attract and retain talent.

In contemplating how to respond to these pressures and trends, government leaders are asking:

• How do we continually deliver initiatives that improve citizen experience and good outcomes?
• Do we have the right operating model and sufficient capability? If not, how do we build it?
• How do we move quickly without risking our success, or damaging our mandate?

‘Digital transformation’ is being replaced with ‘sustainable innovation’, enabled by an innovation culture

Organisations have until recently primarily pursued transformative digital innovation in their move to new digitally-enabled business models. However, the pursuit of ‘digital transformation’ has been replaced with the notion of ‘sustainable innovation’, or of the need to support small, incremental innovation over the longer term and within existing funding and policy constraints, through the creation of cultures in which new ideas flourish. In such a culture ideas with merit are trialled with minimal investment, and those with the potential to scale are identified early.

Indeed, organisational culture, capability and leadership are the most powerful barriers and enablers to sustaining digital innovation  Public sector leaders should therefore consider the following design principles as they shape their organisations:

• Learn by doing: digital is not a domain in which one can sit at the feet of an expert
• Establish simple performance measures to provide leaders and teams with a sharper focus
• Protect specialist capabilities and distinct ways of working in cases where agencies have autonomy to run as a commercial business, allowing them to move faster
• Allow staff to try new things, fail and challenge the status quo and be open to new and disruptive ideas
• Navigate natural tensions, requiring daily judgements and trade-offs.

Public sector leaders are being challenged to demonstrate a new type of leadership

Certain leadership attributes need to be cultivated to enable digital innovation:

• A vision and roadmap for change. Although creating the future is naturally ambiguous, some vision and direction is necessary to energise and unify stakeholders.
• A passion for influence. Leaders need to demonstrate commitment to the citizen experience and influence their peers to support the change agenda.
• An understanding of innovation risk. Leaders must understand how to identify and mitigate risk.
• Courage and resilience. Leaders must be bold and maintain energy and momentum as new barriers and obstacles emerge.
• Collaborative leadership. Leaders must generate energy across silos, harnessing resources and bringing together diverse perspectives to solve problems.

These traits must be accompanied by an understanding of broader technology trends, how they generate new digital possibilities within the business, and practical knowledge of the digital innovation process. Leaders must be educated on these topics so they can lead their organisation forward.

Digital innovation can generate new energy and excitement in public sector work. Leaders who can cultivate these skills and mindsets and maintain a sense of the bigger picture while taking small steps forward will be well-placed to embed and sustain digital innovation in their agencies over the longer term.

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