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22nd November 2017

Lack of budget and knowledge hindering digital transformation within the public sector, reveals UTS and Civica survey

  • Funding trade-offs between investing in physical and digital infrastructure identified as key barrier to digital transformation of local government in particular
  • Civica and UTS Institute for Public Policy and Governance announce 2 year research partnership to advance understanding of challenges of leading public sector change in digital

Sydney, November 22, 2017 – Limited working budgets and organisational culture are the biggest barriers to achieving digital transformation within the public sector particularly focused on Local Government in ANZ, reveals the 'The Changing Landscape for the Public Sector: The Challenges of Building Digital Bridges', a study of local government leaders in Australia and New Zealand.

The report was conducted by the University of Technology Sydney (UTS) and commissioned by Civica, a market leader in business critical software, digital solutions and managed services for organisations around the world helping transform the way they work.

Approximately 70 percent of survey respondents claim that limited working budgets act as a major constraint to digital transformative change, while 65 percent believe organisational culture is an impediment. Speed of technological changes (37 percent), difficulty in matching user expectations (32 percent) and conservative leadership (25 percent) were also listed as barriers.

The figures are part of the fourth edition of Civica's Changing Landscape research series, developed in collaboration with Institute for Public Policy & Governance (UTS:IPPG) at the University of Technology Sydney. This year's report examines the role of leadership in building digital bridges that connect community outcomes and public sector authorities.

According to Professor Roberta Ryan, Director, Institute for Public Policy & Governance (UTS:IPPG) & UTS Centre for Local Government (UTS:CLG), local governments in particular continue to struggle with limited funding, implementation and resourcing issues for digital projects.

"Many local councils have to make a trade-off. Digital services are being pushed down the list of priorities in favour of more immediate requirements to build or maintain physical infrastructure that serves to keep communities moving. Meanwhile, the absence of leadership understanding in driving an outcome-based strategy is also hindering successful implementation of digital initiatives," said Ryan.

Partnerships seen as key enabler for the changing landscape

Local governments are strongly in favour of partnering with other organisations to achieve strategic transformation goals. 58% of respondents felt that partnering with similar organisations was a substantial opportunity for them, and closely followed by partnering with external consultancies (54%) and private organisations (49%). Partnerships with state and federal government were some way behind at 34% and 16% respectively.

"What we are seeing in our work with public sector organisations is that they want to embrace digital solutions. Many organisations operate different system environments. Even though amalgamations offered access to bigger budgets, this also meant that larger amounts of data and systems need to be merged. We see huge potential for the public sector to work with each other and third parties like ourselves to achieve strategic goals – and they appear willing to do this voluntarily – but what maybe they are saying is support us, don't force us" said Richard Fiddis, Managing Director at Civica International.

Key barriers to digital change

While 84 percent of the survey respondents view digital transformation as an opportunity, almost one in five felt they were still not given many chances to learn new skills relevant to a digital-first environment. In addition, nearly 80 percent of respondents admitted failure to implement some digital projects.

There is also still a signficant one in three organisations who believe they only talk about emerging digital technologies. Alarmingly, a small section revealed that they don't pay attention to emerging technologies.

"For some councils their citizens place a high value on physical services and human engagement. At the same time, some communities can seem ambivalent around the use of new technologies," said Fiddis.

Establishing a digital culture

The results demonstrate that organisations with a culture resistant to change or lacking resources and talent struggle with driving transformation projects. Another key reason that can lead to implementation failure is an absence of knowledgeable leadership backed by a sound strategy. Despite the struggles, almost three quarters of the survey respondents state their leadership has a clearly established strategy to become a digitally mature organisation.

According to Fiddis, embracing digital transformation requires the existence of a digital culture and mindset across the organisation, championed by strong leadership that can tackle the challenges of leading in a digital first environment.

"As we see from our work in the UK and our Civica Digital business there, we need leaders to make the tough calls on prioritising investment in digital infrastructure against physical infrastructure, or finding ways to justify and finance both, said Fiddis.

New partnership deal

To formalise Civica's long standing ad hoc working relationship with the University of Technology Sydney, Institute for Public Policy and Governance (UTS: IPPG) and the Centre for Local Government (UTS: CLG), Civica is also announcing a two-year partnership contract with an option to extend for a further year.

The partnership will provide a framework for greater structure around Civica's thought leadership and market insights research program and an opportunity to plan longer term study projects and deepen the collaboration. Civica and UTS: IPPG are also in discussion to extend the partnership into graduate recruitment and bursaries.

The research partnership was announced at the formal launch of the report by Professor Roberta Ryan of the UTS:IPPG at Civica Expo 2017, in Sydney today.

About the report

The Changing Landscape for the Public Sector: The Challenges of Building Digital Bridges report was conducted by the University of Technology Sydney (UTS) Institute for Public Policy and Governance and commissioned by Civica. The study was based on survey responses from 200 professionals within IT teams, finance, corporate and governance teams at local government councils, state departments, infrastructural organisations and educational organisations from Australia and New Zealand.

In-depth interviews with key leaders were also conducted to gain further insights on the experience of driving digital transformation in organisations. These open-ended conversations provided thematic observations and perspectives on specific challenges and opportunities faced by governments adapting to digital change.

About the UTS Institute for Public Policy and Governance

The Institute for Public Policy and Governance (IPPG) at the University of Technology Sydney is a leading group of researchers and practitioners in the areas of public administration and policy, social research, stakeholder engagement, and leadership. IPPG undertakes applied social and behavioural and academic research, policy advisory, graduate education and professional development training. The IPPG team works closely and maintains extensive professional networks within the university and with governments; industry; not-for-profit and community based organisations across Australia and internationally. The UTS Centre for Local Government is part of the IPPG.