Dodging digital transformation's Catch-22

How we fund digital transformation has to change - and the IT industry needs to step up, says Peter Dunn of Rimini Street.

Successive governments have laid out positive visions for the future of public services, underpinned by digital transformation to provide more accessible, efficient and beneficial services for citizens. Meanwhile, local authority senior officials are consumed by short-term priorities managing the consequences of swinging cuts. This is concerning. If the long-term strategy is to digitise local services, we need to help council leaders and chief executives plan ahead. With more financial responsibility devolved to them, they need to be able to address the funding shortfall if digital transformation is to be a success. So how do local authorities find the money to fulfil the vision of public services in the 21st century?

They are faced with a Catch-22 situation. The most obvious way to invest in new projects is to cut or reduce services in other parts of the community. This is a totally unenviable situation for any council leader or chief executive. I am convinced my industry, the IT sector, can and should play a pivotal role in creatively addressing this funding challenge.

The sector has been a great beneficiary of public sector investment over previous decades, but it has also been guilty of over-enthusiastically selling every new generation of technology. It is now time for vendors and consultants to be clear about the quantifiable value they are offering and stop what I call the cycle of "mandatory evolution". The public sector does not need to "rip and replace" all of its existing IT equipment. In fact, a large part of existing IT systems are working just fine, but unfortunately organisations are having to spend far too much of their budgets on just keeping the lights on rather than investing in new technologies. The IT Industry needs to work with local authorities to redress this imbalance so funding can be redirected to where it can help most.

The first action should be to re-examine old fashioned, long-term "eat as much as you want" IT contracts. It is pleasing to see the Government Transformation Strategy acknowledge the need to change vendor relationships because they are not cost-effective at a time when there are many other ways for IT to be delivered. Local authorities need the flexibility to adjust finances in order to respond to the constantly changing funding environment, so being tied into 10-year contracts makes no sense.

No vendor, particularly in the public sector and especially for local authorities, should be allowed through the door unless they can demonstrate how they can deliver quantifiable savings. After all, this is one of the fundamental premises of technology. If it cannot offer efficiency and improvement, why is it even being considered?

Secondly, the biggest killer of public sector projects, mainly those with big ambitions such as or the universal credit scheme, is working out how to make interoperability happen across central government departments and local authority providers. If digital transformation is to fulfil its promise in the public sector then we must find a way to drive integration between different services and organisations to ensure they are sharing relevant information.

The elephant in the room for interoperability is that much of that information is stored on older or legacy IT systems. The IT industry's apparent response to legacy is to tell organisations to get rid of it. This is irresponsible and impractical. Some data stored on legacy systems does not need to move; moving it could be a security risk. 

Given the pressures facing authorities every day, there is no longer any excuse for the IT industry to pretend the same old approach to IT procurement, management and upgrades is acceptable. We need fresh thinking and innovative approaches that allow local authorities to be much more agile in dealing with chronic budget shortfalls. And, perhaps like the public sector, we need to spend more time on prioritising what will offer the most value to our customers and get back to demonstrating how we deliver tangible benefits and innovations. 

Peter Dunn is director for the UK public sector at Rimini Street.