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U.S.: Technology's Real Value for Government
Source: govtech.com
Source Date: Wednesday, January 09, 2013
Focus: Institution and HR Management
Country: United States
Created: Jan 14, 2013

Most of us got into government because we wanted to add value. Unfortunately, when it comes to information technology, too often we're looking only at the beginning of the value chain, the small stuff. We clearly need to pay more attention to the downstream impacts, where the big value lies in improving services, whether it's protecting the environment, keeping communities safe or educating our children.

When we create value with IT in government, three fundamental steps are involved: We start with acquiring the digital tools of IT. We add IT staff, the people needed to select and manage those digital tools. And finally, we leverage those tools and staff to produce and improve government services, both external ones such as public safety, health care and tax administration and internal services such as human resources and financial management.

Let's look at what's involved in each of those steps.

Acquiring information technology: Governments typically spend roughly 1 percent of their funds on information technologies. In general, digital tools roughly double their productivity (bits handled per dollar spent) every few years, as we know from such long-validated observations as Moore's Law for processing and Metcalfe's Law. IT productivity and dollars spent on IT can be rather accurately measured.

IT staff: Governments spend roughly another 4 percent of their budgets--often less--on the staff to purchase these technologies, maintain them and use them to create information services. Direct productivity growth for information services is rarely measured but probably amounts to between 10 and 15 percent per year. This productivity is captured largely not by reducing costs but by making additional information available. So in combination, spending on IT and the staff to run it accounts for roughly 5 percent of government budgets.

Government services: For most governments, some 95 percent of the budget goes to the tools, goods and staff required for the non-IT elements of external and internal services. This is the "meat and potatoes" of government. But how and to what extent can better IT-enabled information improve the productivity of this work?

(By Jerry Mechling)
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