Digitizing the state: Five tasks for national governments

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Public authorities cannot build great digital services on their own. They need national governments to provide the right conditions for them to succeed. For some countries, the provision of comprehensive digital public services is no longer just an aspiration. In Estonia, for instance, the only services that still require a personal interaction with a civil servant are marriage, divorce, and real-estate purchases. In other nations, too, public authorities are building digital services that are just as compelling as the products of leading Internet companies. Research conducted by McKinsey and the company’s global experience with digital transformations in the public sector suggest there are five core tasks that national governments could perform to facilitate the launch and uptake of digital public services. McKinsey’s review of ten European nations shows that when national governments do these tasks, and do them well, countries can achieve high rates of adoption for digital public services.

Task 1: Set a clear digital strategy and targets

Governments can achieve three main benefits from digitization: improved citizen experiences, higher productivity and efficiency, and better policy outcomes. It is therefore useful for national governments to communicate to public authorities the overarching digital strategy and priorities for different time horizons. In this way, they can help to ensure that public authorities’ efforts are focused and synchronized.

The Danish government, for instance, made a strategic decision to move as many existing public services online as possible. Once that initial goal was achieved, the Danish public sector could shift its attention to new priorities such as redefining the citizen experience and developing digital services that would promote priorities, economic growth.

Task 2: Provide common IT platforms

Because of the cost and complexities involved, it is impractical for public authorities to build the necessary technology and management infrastructures on their own. National governments can instead help to establish common IT platforms that all public authorities can use. McKinsey company believes that three applications, in particular, are important to provide: electronic identity management, easy access to digital services for citizens, and seamless exchange of data among public authorities.

Task 3: Set technical standards

National governments as a whole are typically giant users of IT, but their systems are, necessarily, dispersed across countless public authorities. Therefore national governments may be able to play a central role in ensuring interoperability—that is, identifying and managing the relationships and dependencies among different IT systems, and setting principles and guidelines for how systems are developed. The government of Finland, for instance, set up a national enterprise architecture function through a 2011 law Public-sector institutions, with their formal hierarchies and bureaucratic cultures, often struggle to implement these new ways of working. National governments can help alleviate this problem by disseminating standard approaches for implementing agile in public-sector environments. The government of the United Kingdom, for example, publishes on its website extensive guidance about agile methodologies.

Task 4: Facilitate change through legislation

An important way to accelerate the digitization of public services is to give formal legal status to aspirational goals, such as the mandatory digital provision of certain services or the “once only” collection of citizen data. National governments can help to formalize digital objectives by translating them into corresponding changes in administrative rules. National governments could help by scanning existing laws to identify problematic rules and suggesting appropriate changes, while also ensuring the “digital readiness” of new rules. Denmark, for example, has set up a standing committee to manage this task.

Task 5: Incubate pilot projects and build critical skills

Top digital workers often steer away from jobs in government because of relatively low salaries, inflexible career paths, and bureaucratic work cultures. As a result, public authorities often depend primarily on resources from external service providers; their internal capabilities remain weak. National governments can alleviate this situation by helping to incubate pilot digital initiatives, building critical skills in the process. Supporting the creation and management of digital public services is a politically challenging endeavor. It requires massive amounts of coordination and communication by numerous stakeholders across the public sector—not to mention significant resources to build a common IT infrastructure. Investments that politicians authorize today may pay off only after several years, perhaps after the leaders themselves are out of office.

Research conducted by McKinsey finds that the countries with the highest levels of user adoption of digital public services have created central digitization units, wielding sizable staffs and resources, to perform the five outlined tasks. The digitization units should have a stable mandate that lasts beyond the next election. Perhaps most critical for building a culture of innovation, leaders in digitization units should report directly to a strong minister who is publicly committed to digitizing the state.

Not all governments will feel an equally strong sense of political urgency. But one thing is clear: they can no longer be digital laggards without consequences. Citizens have come to expect great digital services from private companies. If they do not receive the same type of user experience from government, they may reduce their overall support for public institutions. For their part, companies facing increased administrative burdens because of outdated “analog” government services may perceive laggard countries as less attractive places in which to do business.

National governments’ role in promoting digitization is clear; the potential for impact has been established. Now is the time to make it happen.

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