During the last decade, the digital transformation of the public sector has been focused on modernizing the Administration: digitizing services, automating processes, simplifying the relationship with citizens and companies and incorporating new technological capabilities. That challenge has not disappeared, but today another one is beginning to impose itself. The difficulty is no longer so much in identifying new initiatives as in deciding which ones should be addressed first when resources are limited.
That change also alters the nature of the conversation. For years we have measured digital transformation with indicators such as digitized files, implemented applications or percentage of electronic procedures. They were necessary indicators to manage execution, but they mainly measured activity. Not necessarily value.
Today we are beginning to be able to complement these indicators with others that allow us to compare the public value generated by each initiative and use them to better inform investment decisions. To respond to this reality, at IBM we have developed the Public Value Index. A model that incorporates impact assessment into digital investment decisions and offers a common framework to inform priorities when resources do not allow it to be done everything.
Activity is not the same as value
Unlike the private sector, the ultimate objective of the Administration is not to maximize profits, but to generate value for society. Precisely for that reason, When resources are limited, the question stops being how much we do and becomes what initiatives generate greater public value.
Let’s imagine two projects. The first will allow more than a million citizens to more easily access administrative information from any device. The second will use analytical capabilities to proactively identify people in vulnerable situations who have the right to receive certain public aid, preventing them from being left out of the system due to lack of knowledge or the complexity of the procedures. Both respond to real needs. Both can be justified from the general interest. But if there was only a budget for one of them, on what criteria should the decision be made? Answering that question requires going beyond traditional activity indicators.
Our proposal is to translate the concept of public value into a practical tool to prioritize initiatives. To do this, the index evaluates each project from five dimensions.
On the one hand, the citizen impact, which takes into account who benefits the service, how much it simplifies the relationship with the Administration and whether it allows acting proactively.
It is also key administrative efficiency, that is, the ability to save costs, reduce time and make better use of public resources.
Added to this is the technological value. It is not about modernizing for the sake of modernizing, but about reducing technical debt, improving cybersecurity, increasing resilience or reducing dependence on a supplier.
Another element is strategic alignment. If an initiative contributes to a government priority, that value should also be reflected in its prioritization.
And finally, there is the legal or regulatory obligation, which must have a specific weight when a standard requires the creation or modification of a digital service.
None of these dimensions, by themselves, determine which project should be executed first. Public value arises from the balance between all of them.
As a practical exercise we have built a first version of a cockpit that visualizes these five dimensions and helps prioritize initiatives.
The index is not intended to answer the question of whether an initiative is good or bad, but rather to help decide which should be done first. That is why we understand it as support for decision making, either manually or through an agent capable of simulating prioritization scenarios as budgets or government priorities change.
When the prioritization criteria are explicit, the nature of the debate changes. Decisions stop relying solely on perceptions, organizational inertia or temporary emergencies and begin to be built on a shared evaluation of the expected impact.
But the change goes further. If an organization systematically prioritizes its investments using these criteria, it is translating its strategic priorities into concrete decisions. The way of prioritizing ends up directing the organization’s behavior towards what it considers generates the most value. In that context, The Public Value Index aspires to provide a framework that helps make explicit the criteria with which decisions that affect millions of citizens are made.
The next stage of digital transformation will not be defined solely by the technologies adopted by administrations. It will be determined by how they use those technologies to decide where they generate the greatest public value.
* Daniel Navas-Parejo is a partner and public sector leader at IBM Consulting