2014: Digital Disruption Seen through 100’s of Audits & Reviews

From 2014.

Author. Marie Johnson. Published on LinkedIn 29 April, 2014

Question: What do 100's of audits, reviews and reports over the past decade have in common?

Answer: A narrative on “IT’ issues and failed “IT projects” and a misreading the structural signs of disruption.

"Digital Disruption of Government: A System Wide View of Governance and Risk"

All sectors – retail, financial services, broadcasting and media, and government administration and service delivery – are going through disruptive change brought about through the impact of digital technologies, digital operating models changing the economics of traditional structures and industries, and digital platforms of engagement with an unprecedented shift in power from the organisation to the consumer / citizen. Government is not immune – this is no a fringe issue or just about “social”. And nor is this a “technology” issue.

This digital disruption has been fermenting over the past decade or more. It is not a recent fad.

The signs have been very clear but interpreted as “technology” or “IT project” issues in a great many audit reports, capability reviews, various inquiries and media reports over the past decade. The question has to be asked, why have these structural and systemic issues persisted? And from a governance and assurance perspective, who is standing back and taking a holistic, system-wide, economic and risk perspective?

In recent years, Capability Reviews in Australia (and elsewhere) have variously pointed to a lack of technology agility and responsiveness, high costs, and technology silos with agencies. A very significant proportion of technology budgets are consumed by BAU infrastructure and applications work in a bottom up and siloed approach that drives operational risk and locks in rigidity and costs. The reviews highlight the need for transformational change and a rethink of the overall approach to technology.

The Capability Reviews highlight a lack of enterprise planning and a lack of enterprise architecture. Whole of government opportunities are diminished and interoperability more challenged in the absence of an enterprise architecture or whole of government architecture. I will be writing more about this in my next LinkedIn blog post.

Over a decade or more, the Australian National Audit Office and various audits of inquiry dealing with "governance" and "IT projects" have variously pointed to: complexity of systems; lack of an architecture; lack of business engagement; inadequate or scarce skills; and “IT” procurement. "IT projects" are identified as costing too much, delivering too little, or failing.

Standing back from all the individual Capability Reviews, audit reports and various inquiries - and looking strategically and systemically - there appears to be some fundamental governance and assurance questions to be addressed.

Why are new capability or reform initiatives persistently described by various audits, reviews and reports as "IT projects"? Responsibility and accountability cannot be understood or attributed with such a frame of reference.

And how can it be, that after a decade of such audits and massive investments, the recent Capability Reviews continue to point to persistent “IT” issues.

There is no such thing as an "IT project" - and it is concerning that audit reports and various reviews carry this type of reference. It doing so, it causes the systemic issues to remain unidentified, unexamined and unaddressed.

It would seem that the various audits, reviews and reports individually are misreading or not identifying the systemic signs of disruption.

From a system-wide assurance perspective, what is the overall risk picture - and how is this or how should this be managed strategically and systemically? This is a particularly focusing question in this period of digital disruption when the power relationships and economics of operating models and industries are structurally shifting.

The following Australian and international examples illustrate how systemic risks manifests (in what might appear sudden) when accountability is not clear.

The Queensland Government ICT Audit found that 90% of the Queensland Government’s ICT systems were outdated and will require replacement within five years at a total cost of AUD $7.4 billion. This is a big number but not the total risk picture.

Headlines such as the following are all too familiar:

“Hospital IT booking system ‘putting lives at risk’”

http://delimiter.com.au/2014/04/09/hospital-booking-system-putting-lives-risk/

“Victoria Police links IT failure to tragic death.”

http://delimiter.com.au/2014/02/14/victoria-police-link-failure-tragic-death/

These “systems” do not put lives at risk – a “system” cannot be accountable.

Australia is not alone. The CIO Magazine recently carried quite a worrying article: “The worst IT project disasters of 2013”

http://www.cio.com.au/article/533907/worst_it_project_disasters_2013/

This article is worrying because it presents a lack of understanding of the underlying systemic issues. Healthcare.gov was not an "IT project”- it was fundamentally an economic initiative of program redesign, requiring data exchange and massive change management.

What to do?

There needs to be a re-think and a re-assessment of systemic governance and assurance in government administration (in Australia and elsewhere) – and this is particularly imperative in the digital era. This does not mean more processes or less risk. It means understanding complex systems (as opposed to discrete and apparently unrelated projects) and strengthening appropriately.

Avoid any initiative that is presented as an “IT project”. New capability – yes. Innovation – yes. New business model – yes.

The strategic narrative needs to change from “technology” - there is too much focus on the "technology" and a lack of strategic focus on the "information". This is a very significant issue – because with all the “IT project failures” the issue has not been about the technology, but about the information and data. Technology does not equal data.

In a data dependent and data driven ecosystem of government administration - and the need for evidence based decision-making – the various audits, reviews and reports reflect poor knowledge management and data management practices across agencies. Analytics - one of the core capabilities of the digital era – has been based on the dedicated efforts of a few areas but has not been invested in or driven strategically at an enterprise level. The retail and banking sectors by contrast apply analytics as a core and strategic capability.

The final point – which I will elaborate on in a following LinkedIn blog – is that without a strategic capability architecture in government administration there can be no effective governance.

How can you build a building with out an architectural blueprint – or a town without a town plan?

It is the data – not the technology – that is the foundation.

And “interoperability” across the “town” is how the citizens are served.