Government Innovation: Not an Oxymoron?
How this 200 year-old bureaucracy is embracing technology.
The U.S. government fights forest fires, prevents epidemics, responds to financial crises, and provides critical services to billions of people around the world. Unfortunately, the feds have been slow to embrace digital transformation, leading to massive failures in delivering its customer promise. New digital initiatives promise change. Amidst growing complexity and shrinking budgets, public servants will need to embrace technology as a force-multiplier.
Technology has been at the heart of major government scandals in recent years, highlighting flaws that exist across the public sector. A 2015 report exposed that more than 300,000 veterans died while waiting for their benefits applications to be processed by the Veterans Health Administration. Part of the problem was increased need arising from two wars. Outdated information systems, including miles of filing cabinets, had a central role in these delays. In 2013, President Obama’s signature achievement, the Affordable Care Act, faced failure because of faulty technology. Millions of users went to Healthcare.gov to sign up for insurance but found an error message. The program’s financial viability depended on meeting enrollment targets, particularly for young, low-risk consumers. To rescue the website, a team of Silicon Valley techies came to Washington.
This exposed the Obama Administration to the need for widespread digital transformation. The White House established the U.S. Digital Service (USDS). The new office brought modern technology practices to government, building on the example of the young Consumer Financial Protection Bureau. USDS recruited top talent through 2-year “tours of duty” and established principles to guide technology management. In parallel, the General Services Administration established a new team, dubbed “18F” to build platforms for use across agencies, reducing cost and complexity.
Of course, not all parts of the government had been blind to digital transformation. The military has been investing in GPS and internet-of-things technology for intelligence, situational awareness, and communication. The U.S. Forest Service uses remote sensors to automatically map wildfires and respond in rapidly changing conditions. IoT has proven useful in costs savings as well, with the GSA using sensors in buildings to drive energy efficiency. Cisco estimates that public sector use of IoT could deliver $4.6 trillion in value.
Based on lessons learned in TOM, I present three recommendations to accelerate the transformation of government.
- Bring technologists into policy development. Policy formation follows the familiar double-diamond process of product development. Technology is currently an after-thought, but it could transform how policy is conceived. For example, the CFPB accepts complaints from citizens. It routes them to financial institutions and demands a response to the consumer within 14 days—an unheard level of service. The agency uses data from this process to inform supervision and publishes the data to inform consumer choice.
- Empower the supply chain to create value. The U.S. government shared its GPS data, enabling businesses like Google Maps, Uber, and Pokémon GO. It shared weather data that enabled several industries, including weather prediction, aviation, and insurance. McKinsey estimates that more of this data sharing could create $3 trillion in value annually and reduce the burden on the public sector.
- Make technology a permanent priority. Government is subject to politics, which is extremely variable. The government should mandate the USDS become a permanent function. This would communicate stability for downstream operations and allow civil servants to make rational decisions.
People in power change, but the civil service remains and the tide of technology rises. We have reason to be hopeful. (729 words)
 Office of Inspector General, Veterans Health Administration: Review of Alleged Mismanagement at the Health Eligibility Center, http://www.va.gov/oig/pubs/VAOIG-14-01792-510.pdf, accessed November 2016.
 Christopher Weaver and Louise Radnofsky, “Federal Health Site Stymied by Lack of Direction,” The Wall Street Journal, October 28, 2013, http://www.wsj.com/articles/SB10001424052702304682504579158043537719338, accessed November 2016.
 The U.S. Digital Service, “Digital Services Playbook,” https://playbook.cio.gov/, accessed November 2016.
 Kymm McCabe, “Federal digital transformation: What’s next for USDS and 18F?,” The Business of Federal Technology, July 28, 2016, https://fcw.com/articles/2016/07/28/comment-mccabe-18f-usds.aspx, accessed November 2016.
 Catherine Andrews et al., “What the IoT Means for the Public Sector”, ISACA, http://www.isaca.org/Groups/Professional-English/cybersecurity/GroupDocuments/IoT%20in%20the%20Public%20Sector.pdf, accessed November 2016.
 Joseph Bradley et al., “Internet of Everything: a $4.6 Trillion Public -Sector Opportunity,” White Paper, 2013, Cisco, http://internetofeverything.cisco.com/sites/default/files/docs/en/ioe_public_sector_vas_white%20paper_121913final.pdf, accessed November 2016.
 Consumer Financial Protection Bureau, “How we use complaint data,” http://www.consumerfinance.gov/complaint/data-use/, accessed November 2016.
 James Manyika et al., “Open data: Unlocking innovation and performance with liquid information,” McKinsey Global Institute (October 2013), McKinsey & Company, http://www.mckinsey.com/business-functions/digital-mckinsey/our-insights/open-data-unlocking-innovation-and-performance-with-liquid-information, accessed November 2016.
Student comments on Government Innovation: Not an Oxymoron?
I’m glad you have reason to feel optimistic! I’m particularly interested in this division between the Department of Defense, which seems to be at the cutting edge of so many emerging technologies, and other wings of the government. Could there be some way to increase communication and best practice-sharing between DoD and other parts of our government that could spread these competencies without compromising confidentiality? Could we do staff exchanges between DoD and other cabinet departments, for example?
Very interesting piece on something we would all be glad for — a government that serves us better through technology! The only thing I worry about a little bit is too much proliferation of agencies. What I would really advocate for is a bit of a “reorg” of government. Can we go back to the drawing board, map out the various buckets of value we need to deliver, and then design our agencies around those things? I expect that there are areas (like CFPB) where we are getting it right but others that could really benefit from efficiency improvements. Obviously getting the political will necessary to actually do that is nearly impossible, but I can dream for a second. I had a friend who worked at a defense contractor that partnered with various national security / intelligence agencies. Based on what I learned from her, the sheer number of intelligence-related agencies and the confusing, somewhat overlapping nature of their mandates actually creates a lot of the IT issues, poor communication, and information-sharing obstacles that they experience.
Really interesting post – I particularly liked the recommendations. I certainly recognize the value in having the government share data with private companies, but it seems that there’s opportunity for a two-way information exchange. I.e. what could the federal government accomplish with data provided by the private sector? I’d imagine the legality around this is complicated, but seems that there is tremendous upside.
I hope that your vision for technological efficiencies in the government plays out in real life. You present a very real impact of failing to update the government technology infrastructure – veterans die without access to benefits. It is appalling that this is happening. But in other areas of government, such as Immigration services, the government may actually benefit from being inefficient. Each time an application is filed, the government charged filing fees. When adjusting one’s immigration status, a person may find themselves submitting the same information over and over again (birth certificates, passport info, photographs, etc) with each step of the process. Its infuriating because you, in effect, have to pay ridiculous amounts for the government to process the same information over an over again. Updating the system may loose the government money, thought it also has the potential to increase revenue by being able to process more applications efficiently.
Great post! I think it is really interesting that the near collapse of healthcare.gov and the scandal about veteran health benefits is what it took to motivate a closer look at the value that technology can provide when more fully integrated into government. My understanding of policy making is that it often takes a singular, salient event (like the events you describe) to motivate a policy change. To that end, there are often policy solutions that are drafted and then put on the shelf should the right political circumstances arise to make the policy feasible and politically palatable. Given that policy is often implemented only after these kinds of “focusing events,”  perhaps in addition to your suggestion of bringing technologists into specific agencies, the government could create advisory boards of technologists that might propose a range of use-cases for technology in government. Certainly many of their suggestions might not be implementable right away, but if these technology “dream teams” could be used to draft plausible policies, then at least the policies could be ready on the shelf when the political moment to implement them arrives.
References:  Birkland, Thomas. “Focusing Events, Mobilization, and Agenda Setting.” Journal of Public Policy (18:1), 1998:53-74.
Just because of scale, any micro improvement in the public sector can yield huge impact. I keep going back to the FRC case on Siemens and corruption. While public corruption varies by country in terms of shape and form, it is common knowledge that it happens everywhere. Digitization in the public sector could yield massive social impact but at what point does it run counter to the decision maker’s incentives? Is this something that can be started at the county level with an honest mayor, or should it be top down? I’m fascinated by the opportunities this can bring if we can address the initial hurdle to implementation.
I too find it an area of tremendous potential impact. What I wonder is whether there is a sufficient incentive for governments to optimize their operations through digitization. It somehow feels like the knowledge of technology and understanding of its potential are present among our politicians’ teams, but they tend to manifest predominantly during electoral campaigns (often close to digital communication masterpieces). This is what makes me afraid that the current voter is simply not sufficiently reactive to “technological” failures of the governments, and often even accepting of the excuse that “the system did not work”. But I hope the coming generations will become more taxing both of system failures and inefficiencies that can easily be addressed through technology.
Great read! One of the ways I’ve seen government increasingly working is leveraging both technology and a focus on efficiency to bring a range of government operations under one roof / one-stop shop for all your government services. It’s something that hasn’t taken off as much in the US (likely due to Federal / State disputes, and the dislike most people have for the DMV). One of the main challenges I suspect most governments will have is creating those positive impressions for people engaging with government, rather than feeling as if it is impersonal, distant, and only aggravating. Hopefully technology, and an increasing degree of customized, close, and rapid interaction can serve to change that.
First, as Evan mentions above, the defense and research side of the government has done quite a bit to advance technology. We must not forget that DARPA aided in the development of the Internet (with much contribution from many other scientists and visionaries) .
The current administration has actually done a fair amount in this space recently (perhaps never enough for our tastes, I recognize). The White House has created the first Chief Technology Officer of the U.S., sponsored Health Datapaloozas, backed robotics and wireless advancements, and opened access to data . That is not to say it is perfect, as noted above, but it is moving in the right direction; one such way is by starting a the Presidential Innovation Fellows (PIF) program to “bring the innovation economy into government, by pairing talented, diverse technologists and innovators with top civil-servants and change-makers within the federal government to tackle some our nation’s biggest challenges.”  When visiting HBS, I listed to PIFs explain present on their projects and I was quite impressed by these folks’ dedication to change-making through technology. One PIF was opening access to data (formerly protected), for citizens to use, for entrepreneurs to leverage for business, and for academics to use in their research. Another created profiles of Veterans to stitch together problems the government could solve to serve these folks better . I was struck by these Fellows’ dedication to the public sector, some staying on beyond their term to continue to enact change in their agency. While these programs are great instruments to attract talent, the government also needs to continue to foster change from within, to streamline and modernize its operations.
I look forward to seeing how this progresses, and hopefully some of us can have a hand in advancing the use of technology for the public good.
This is a really interesting topic, and one that has potential to impact us all. I am no tech guru, but I wonder how technology and digital innovation can continually foster the government to “empower the supply chain to create value” by working together with businesses and delegating some of the governments current functions to them. I know of companies, like IBM, who are dedicating efforts to improve how cities can become “smarter” and leverage digital technology partnering with governments to enhance a range of services such as: emergency management, law enforcement, city planning and operations, transportation, among others. 
Reading this article immediately reminds me of the extremely manual (and extremely painful) processes in the Indian government. Though they too have started digitizing, they have a long way to go. I agree with the above comments that it would help for the information sharing to be both ways. Maybe health spending could be one of them?
Great article — and very much agree with the comment above regarding a “reorg” of the federal bureaucracy, given the major changes in how we communicate and transact that have unfolded over the past decades. I wonder how the element of risk (i.e., cyberterrorism) factors into how far the government can go in embracing the IoT. If they make operational efficiency decisions that streamline information and process flows, thereby centralizing large repositories of often confidential data, does that open the average American as well as our government up to a greater threat from hackers? I recently heard a resiliency expert say that the fragmented power/utilities grid in the NYC metro area was (counter-intuitively) a lifesaver during Hurricane Sandy. So it seems like a catch-22. If the feds upgrade and simplify their systems to enable better communication with citizens and among their departments, does that mean one system is more fallible than many antiquated ones, even if they slow us down? How nimbly can technology solve for and support cybersecurity initiatives? See here for more on the IoT and security: https://techcrunch.com/2015/10/24/why-iot-security-is-so-critical/