One of the biggest challenges of improving service delivery through a transformed government is defining the value of the service before it is implemented and then measuring its actual value once it has been delivered. 

So says SAP Global Public Sector IBU vice-president, Ian Swann, whose presentation at GovTech dealt with delivering value to the citizens and constituents of government.
“Governments have challenges not experienced in the commercial sector,” he says. “They must preserve fiscal stability while encouraging citizen involvement, deliver effective social programs, build consensus, manage natural, cultural, and historic resources, plan for the future, and represent citizen needs to other levels of government.
“They must also deliver both social and political as well as economic value to an enormously wide variety of stakeholders – including citizens, businesses, elected officials, regulatory agencies and other governments.
“Increasingly, governments are using information technology (IT) to achieve all that. But they don’t have unlimited budgets and there’s enormous pressure to optimise tax payers’ funds.
“So they need not only to justify their IT expenditures but prioritise them amid high service expectations,” says Swann.
“Also, they recognise that being able to measure and promote their performance is a powerful way of building public trust and maximising public value. In the commercial sector, this corresponds to measuring return on investment (ROI).
“Historical attempts at applying ROI measurement to IT expenditure in the public sector have involved financial and operational-based quantitative methods to calculate cost-avoidance or cost-benefit. But that’s a one-dimensional view of a hugely complex organism. ROI measurements in the public sector need to include both the tangible and intangible impact of government IT spending.”
However, there has been no standardised framework for defining and assessing the value of IT projects outside of financial considerations.
This shortcoming has been confounded by the fact that, according to an SAP-sponsored study by the Economist Intelligence Unit, the fundamental nature of government is changing.
Modern governments need to be more citizen-aware and, accordingly, more responsive – which requires an innovation capability and the ability to act quickly.
Citizens are also insisting that governments be more transparent and accountable.
“That creates the need for governments to give a lot more attention to the business case for any given initiative,” Swann says.
“They have to be able to prioritise not just IT investment but the government programmes that IT supports. And that means being able to understand where the direct value in a programme lies for a range of different stakeholders.
“It also means taking into account the secondary, multiplier effect of greater efficiency within government itself.”
But, Swann points out, the changing nature of government doesn’t stop at individual programmes, departments or governments.
“Today’s governments need interoperability – not only among their own internal departments, but across international borders and with the private sector. Security is the best example of this need – as 9/11 has taught us. All sorts of different organisations need to collaborate in order to keep a country secure – and healthy, and wealthy.
“If we can’t break down organisational and international barriers to effective working, we’re never going to optimise the process of governing.”
In 2005, SAP brought together its government customers and partners, as well as public sector experts from such organisations as Harvard University’s John F Kennedy School of Government and the Center for Technology in Government (CTG) of the State University of Albany, New York, in a two-day workshop aimed at defining the basis for a non-proprietary framework that governments could use to establish the value of their service delivery projects.
The CTG then used the outcomes of the workshop to develop a Public ROI framework. The framework’s strategy is simple – connect what happens in the government with the impacts on stakeholders in the public domain, then report and apply the results.
The framework itself identifies the ways n which government IT investments link to public value.
It starts with identifying the potential value mechanisms of an IT investment, and desired outcomes or goals. These are linked to stakeholder interests, impacts, and risks. Next, specific variables are selected for collecting assessment data, whether by using existing schemes or creating new ones.
Then risk analysis is conducted to identify and evaluate threats that yield information for decision making, such as whether to move ahead or cancel an IT investment. Finally, the framework provides illustrative examples of how to summarise and present the results of the analysis, particularly in the language of each of the appropriate stakeholders.
“The important thing to remember is that, while the Public ROI framework is based on measuring the value of government IT projects, the projects themselves are aimed at improving service delivery,” Swann says.
“In other words, by measuring the value of your IT investments, you’re automatically measuring the value of your service delivery programmes.”