Public sector technology can often be perceived as the poor cousin of its commercial counterpart. Never mind digital transformation, it’s barely had the money for a digital watch in recent times. Even when it tries to upgrade itself with the aid of a third party, the Public Accounts Committee or other watchdog tends to be critical. There is a sense of not being able to win.
Nonetheless, a survey of 19 CFOs in the UK’s public sector by Ernst and Young (EY) suggests that digital transformation is very much on their agenda, even if we published research only this week indicating that a lot of organisations are less than confident about how ready they are for it.
Ready or not, according to the survey 58 per cent of public sector chiefs think digital transformation is going to be vital over the next five years. 68 per cent of them are spending more time making plans for it than they were five years ago (unsurprisingly as “digital transformation” wasn’t an issue five years ago), and perhaps most significantly 95 per cent want to see more collaboration across entities.
Is digital transformation the gateway to shared services?
It’s this last point that may be the most transformative thing about any digital transformation that takes place. Traditionally, every local council and other entity will have its own HR, its own payroll, its own database and its own ways of working. The digital world, if implemented consistently across the field, will remove a lot of the need for that disparity.
If one London authority next to another, for example, use the same financial system and the same payroll software, or the same external payroll supplier, the need for them to operate the systems separately simply goes away. That’s true in a technological sense; add the people and internal politics and you have a different scenario in which people will be baffled that they are handling two local authorities; payrolls without an increase in salary (or at least not doubling it); add the notion of inconsistent legacy systems and you have scope for even more conflict.
EY confirms that it has found public sector CFOs becoming more strategic than they were before and taking part in more and more decision making than previously, mostly as a result of the technology on offer.
“The pressures to deliver more with less in the public sector has thrust the role into the spotlight and they are responding to this challenge in different ways,” saidDarra Singh, Head of UK Government and Public Sector at EY. “This includes the use of technology such as blockchain and sophisticated data analytics. We are seeing quite different profiles and responsibilities emerge when compared to the traditional idea of a public sector CFO.”
The full report, entitled “The Changing Role of the CFO”, is available here.