Opening mark thompson

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Opening mark thompson

  1. 1. Post-bureaucratic government, openplatforms, and innovation: Whygovernment IT should never be thesame againMark ThompsonJudge Business School, CambridgeStrategy Director, Methods ConsultingICT Futures advisor, Cabinet Office
  2. 2. Transformational government? „Joined up‟ public services Disaggregation & outsourcing „Agencification‟ private sector commercial practices Top-down, managerialist concepts Business people appointed to senior public sector roles Emphasis on „customers‟ and „contracts‟
  3. 3. Digital-era government? Dunleavy & Margetts, 2010
  4. 4. …sounds innovative, but…actually, this is not really what happened! Public sector aggregated supply, not demand No reference model across government; widespread “we‟re special” Government „outsourced‟ strategy & architecture Contracts priced for risk, which was never outsourced „Intelligent Customer‟ skills leeched away from public sector Track record of “stupendous incompetence” and bungling Bespoke, complex, siloed, duplicatory, risky, and constrained - but why would anyone want to do anything differently?
  5. 5. Level playing field?
  6. 6. Baked-in failure: IT is a good place tostart An array of high cost programmes have run late, under-performed or failed (terminated) over the last 20 years: • Inadequate information, resulting in the Government being unable to manage its needs successfully • Over-reliance on a small number of large suppliers and the virtual exclusion of small and medium sized (SME) suppliers, which tend to be less risk adverse and more innovative • Failure to integrate IT into the wider policy and business change programmes • A tendency to commission large, complex projects which struggle to adapt to changing circumstances • Over-specifying security requirements • Lack of sufficient leadership and skills to manage IT within the Civil Service, and in particular the absence of an “intelligent customer” function in Departments
  7. 7. Further issues…Lack of real understanding in governmentDisjointed, „initiative‟ approachNo real mechanism for holding govt to accountNo concrete plans for cascading into depts„Commercial confidentiality‟ as barrier to transparencyIgnored recommendation to commission independentinvestigation into suppliersInsufficient attention to developing intelligent customercapability within govtNeed to engage in honest debate with question ofpublic service redesign
  8. 8. Does this matter? 105 outsourced public sector ICT projects with significant cost overruns, delays and terminations: • Average % cost overrun 30.5% • Total value of contracts: £29.5 billion • Cost overruns totalled: £9.0 billion • 57% of contracts experienced cost overruns • Average percentage cost overrun: 30.5% • 33% of contracts suffered major delays • 30% of contracts were terminated • 12.5% of Strategic Service Delivery Partnership contractsAnalysis (2007) of 105 projects terminated or substantially reducedoutsourced by CCG, NHS, LAs,public bodies & agencies withsignificant cost overruns, delaysand terminations. Cost increasesare often underestimated asnumbers reported usually onlyinclude payments to contractors,and not costs born by the clientsuch as additional client staffengaged.
  9. 9. An Intelligent Customer?The Government‟s inability to act as an intelligent customer seems to be a consequence ofits decision to outsource a large amount of its IT operations to the private sector.The NAO noted that many IT contracts:Are for a government body‟s whole ICT service, meaning that Civil Service Staff, knowledgeskills, networks, and infrastructure have been transferred to a supplier. This has effectivelylocked government into specific contracts for the long-term.
  10. 10. So what’s different now?Cabinet office is starting with IT… …But the prize is public services itself!Progressive recognition of: Focus on outcomes, open standards Commercial implications of emerging open platforms Ability of „utility‟ services marketplace to deliver citizen-based servicesAn emerging reality: Systems & processes were traditionally integrated & clustered around supplier/technology Dis-integration of systems & processes Re-aggregation into blended services, clustered around citizen
  11. 11. Public service delivery will become unrecogniseableOrganisations will:• transition from focus on inputs to outcomes• play the emerging utility marketplace• become increasingly fixated on standard ways of doing things• ratchet up focus on TCO• dis-integrate• become a Component Trader• re-aggregate• redefine what „projects‟ areThe market will:• Re-organise around platforms• Penalise idiosyncrasy
  12. 12. Do YOU have…An undifferentiated outsourcing contract?A clear idea of TCO across your business?An idea of how you will be able to deliver newservices, differently, using the utility model?Confidence that you‟re paying bargain-basement rates for bargain-basement commodities?A Target Operating Model?A comprehensive plan for exploiting the economics of the OpenInnovation revolution?…a way to transition from focusing on inputs to outcomes, across ITand then services?
  13. 13. IT has become an economic model
  14. 14. Bespoke products/services areexpensive
  15. 15. Moving from innovation tocommodity…
  16. 16. Innovation to commodity…
  17. 17. Supporting the innovation-commodity process
  18. 18. Supporting the commoditisationprocess
  19. 19. Different skillsets to manage these…
  20. 20. …and different activities
  21. 21. A new way of looking at IT-drivenservices
  22. 22. Skilling up
  23. 23. Open Platforms & Innovation
  24. 24. …an unprecedentedly radical agenda
  25. 25. “…Aaahh, but of course this model applies only to hi-tech / startups like Amazon or Google, and certainly not to government!”
  26. 26. Extension of Open Innovation to business logicTrue… Open innovation lent itself particularly to tech artifacts, e.g. code, that could be standardised, chopped up & recombined easily…And then along came… XML, wrappering, SOA, open APIs, web services etc, allowing business logic to be standardised, chopped up, parsed, and purchased more accurately
  27. 27. Systems Integration
  28. 28. Systems dis-integration
  29. 29. Services re-aggregation
  30. 30. An increasing interest in/appetite for… Open standards Modularisation Commoditisation Virtualisation Utility/consumption models Post-bureaucratic delivery/new TOMs Shared services New, innovative services Cloud Resale/co-creation/revenue sharing New ways of working/mobile
  31. 31. The need for a ‘roadmap’… Constrained Harmonised Embracing ExploitingComplex landscape of Standardised Starting the journey Maximising the usagetechnology and technology and to utility / Cloud of utility / cloudbusiness processes business processes Services services appropriateRestrictive support Restrictive support to your businessand commercial and commercialmodels models
  32. 32. …with a clear business case for savings realisationCost Constrained Harmonised Embracing Exploiting
  33. 33. Service dis-integration Dedicated Shared Utility Process ICTServices People
  34. 34. Service Re-aggregationUtility Service People Shared Service People Process Dedicated Service Process People Process TechnologyTechnology Technology
  35. 35. ‘Revs and Bens’ in local govt will become unrecogniseable Utility Service E-Forms (internal and Shared Service customer facing) Workflow Case Document ManagementDedicated Management (for appeals)Service Mail-Merge Customer Payment Engine Database Cash Receipting Engine
  36. 36. Local government example: people
  37. 37. Building a component-based reference model “service A” + “service B”+ “service C”+ “service D”Opportunity Document Management Infrastructure Training provision services L&T Resources (on- line content) Payments On-line resources (e- Third party learning) Mail / messaging payments Payments (utility- based) Payments Processing Video conferencing (media services) Workflow Cash receipting Output Mail (collaboration) Data Input Market Maturity
  38. 38. Public service delivery will become unrecogniseableOrganisations will:• transition from focus on inputs to outcomes• play the emerging utility marketplace• become increasingly fixated on standard ways of doing things• ratchet up focus on TCO• dis-integrate• become a Component Trader• re-aggregate• redefine what „projects‟ areThe market will:• Re-organise around platforms• Penalise idiosyncrasy
  39. 39. …and IT lies at the heart of new delivery models! Thank you

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