Policy paper

Government Transformation Strategy: background

Published 9 February 2017

Background

When we say transformation, we mean a significant step change in the way a government organisation delivers its services and in the way it operates. Any change that government makes is driven by 3 considerations:

1. Citizens: changing the way government interacts with citizens and businesses, whether online, at national borders, face to face, on the phone or in an emergency.
2. Policy: implementing the government’s policy agenda to make social change and change people’s lives.
3. Efficiency: making government work in a more cost-effective way.

One of the most powerful enablers of transformation in the early 21st century is to adopt the tools, techniques, technology and approaches of the internet age. This is what we define as ‘digital’. It is a cultural change as well as a technical one.

Since 2010, the UK government has become one of the most digitally advanced in the world. The Government Digital Service (GDS) was created in 2011 as a digital centre of excellence for government. GOV.UK was launched in 2012. By the end of 2014 it had replaced the majority of department and agency websites. Departments created numerous digital services across government. GOV.UK Verify was developed as a way for users to prove their identity online securely. Two additional reusable components have been launched that make the job of delivering services across government easier and the user experience more consistent: GOV.UK Pay and Notify.

We have also invested heavily in skills and people, recruiting a large number of digital specialists (most of whom work in departments) and improving the training available to public servants (through initiatives such as the Department for Work and Pensions (DWP) Digital Academy, which has trained almost 4,000 staff since it was established in 2014).

Departments have been transforming themselves to make the most of the opportunities created by digital technology, both to meet their users’ needs and to modernise their internal operations. Millions of citizens now have the convenience of doing business with government from their home or on the move at a time of their choosing. DVLA annual report and accounts 2015 to 2016 reported that from April 2015 to March 2016 over 33 million people taxed their vehicle online (and no longer need a paper record), 93% of vehicle tax and drivers’ transactions (about 200 million per year) were done online, over 4 million people applied for a driving licence online and over 5.7 million people used the voter registration digital service, with a peak of 469,000 applications in one day.

Read the transformation case studies for more information about how:

• DWP is re-engineering the welfare system
• HM Revenue and Customs (HMRC) is fundamentally rethinking tax in a digital age
• HM Courts and Tribunals Service (HMCTS) is modernising the courts and tribunals system, enabled by digital services
• HM Passport Office (HMPO) is moving to a modern, digital process where 31% of customers already use either the online channel or the new online renewal service, amounting to 2.2 million customers per year enjoying a digital experience
• Office for National Statistics (ONS) is targeting 75% digital take-up in the 2021 Census
• Department for Education (DfE) is launching a digital apprenticeship service
• Department for Environment, Food and Rural Affairs (Defra) is transforming services for its regulated customers

As a government, we are here to further the prosperity and security of the UK, to serve the citizen and to build on our position as a world-leading provider of public services. The digital revolution kick-started by GDS in 2010 has seen us make great strides. However, there is much more we still need to do. We must reflect our increased experience and understanding. The government’s approach to digital must be comprehensive and we must expand our focus, underlined by the creation of new senior roles with a wider government mandate.

This strategy builds on those of previous governments and sets out what public servants will do to continue to transform the public sector for the digital age. It is not just about providing the digital services citizens rightly expect, but also about ensuring that government continues to modernise itself on the inside. All of this must be enabled by giving citizens confidence that the government will respect their personal data and identity. By doing so we can improve outcomes, deliver a better service and improve the efficiency of our operations - transforming the relationship between citizen and state.

Read more about GDS’s role in implementing this strategy.

Digital context

We all know the world is changing rapidly. The average British person now spends around £1,500 online for goods each year, making us the most frequent online shoppers in Europe. One of our major retailers made 4 in 10 sales online last Christmas, with smartphones and tablets the fastest growing channel, up by 31%. The UK digital economy is one of the most developed in the world, worth around £145 billion per year. Globally, industries are being disrupted and transformed by software such as Netflix (entertainment) and Spotify (music), Uber (travel), Airbnb (accommodation) and Fitbit (health); retailers like Amazon are built around technology. There has also been a social media explosion: Facebook has nearly 1.8 billion active users each month (PDF, 430KB) and has built a multi-billion dollar mobile advertising business from scratch in the last few years.

The accelerating pace of internet-enabled change

A set of common factors have come together to create a multiplier effect, enabling rapid innovation, where the culture, technology and practices of the internet era are applied to create services that people want to use, in many cases generating demand that did not previously exist. WhatsApp and Facebook Messenger, for example, together handle 60 billion messages a day, while the combined global mobile networks handle 20 billion. 71% of UK adults now have a ‘pocket supercomputer’, which is personal and taken everywhere. On average, people spend over two hours a day using them, rising to nearly five hours for those aged 16 to 24. Each smartphone knows its location, has sensors and cameras, notifications, a contacts list, payment information and is much easier to use than a traditional computer. This fundamentally changes what is possible. Using the internet is no longer just about web pages and PCs with a mouse and keyboard. More and more devices are being connected together, for example in the home; these are built with components from the smartphone supply chain and will drive a corresponding rise in the amount of data from their sensors.

Wide availability of fast internet connectivity enables people to use their smartphones everywhere - not just when they are in the street, but at home and increasingly while sitting in front of a computer.

New business models enable people to share and sell goods and services to one another much more directly and cheaply. These consolidated platforms of demand allow people from outside an organisation to deliver something of value to the organisation’s users. This is why, for example, an app store can sustain over 1 million apps.

Powerful services can now be assembled quickly by joining multiple data sets and commodity components. For example, combining location, maps and open, real-time public transport information in a cloud-hosted service can create a service that tells people the quickest way to reach their destination. Services can be linked to payments, profile or identity, notifications and messaging. Innovation is now limited by the vision and route to market, not by how long it takes to construct the technology.

Any organisation can now easily have a public face on the internet with a web page, or can use internet-based services to improve the way their organisation runs. However organisations that are truly ‘of the internet’ are applying some or all of the factors above to enable completely new ways of doing business.

Modern online businesses are using data analysis techniques and machine learning, so that their services change continually based on how they are being used. This helps them improve their efficiency, but poses new ethical questions around areas such as the impact of automated newsfeeds and pricing policies. Start-ups and traditional businesses alike store large amounts of personal information, raising concerns around security and privacy for their users in an environment where breaches are increasingly in the headlines. The culture of start-up organisations is to focus on the outcomes they are trying to achieve, while consuming internet-based shared service platforms (‘in the cloud’) to support their internal processes - such as customer service, payments, HR, payroll and finance. These components and back-end functions are shared by millions of users all over the world and thus attract significant investment, but can be tailored to meet specific user needs. A small company can now have a better HR system than a big enterprise and at a fraction of the cost per user. These organisations are often new enough to be unencumbered by legacy technology that would reduce their ability to change their businesses. Coupled with this, employees’ expectations are changing: young people entering the workforce expect a different kind of employment.

This digital revolution is transforming society and creating significant economic benefits worldwide, much of which will be driven by the private market and entrepreneurs. The pace of change is accelerating, raising people’s expectations that government will apply the same practices and technologies to improve its services and also the way, behind the scenes, those services are delivered.

Implications for government services

Developments in the private sector may highlight opportunities for government, but some of these do not translate directly into public service provision. For example, private sector companies can choose to target certain customers and exclude others. Public service providers, on the whole, cannot.

Many sectors have been disrupted by new companies making the best use of digital technology, but it is not a given that similar benefits will be realised by government automatically. It is not possible to disintermediate critical services like benefits and courts, where people depend on public services and have no choice about whether to use them. Services must work for the whole of society - not just the 77% of people who have basic digital skills, but for the 12.6 million adults who don’t. Read the 2015 UK report on basic digital skills (PDF, 1.6MB) for more information.

This is particularly important as financial exclusion and digital exclusion often go hand in hand. People who are the least online are often heavier users of public services, highlighting the need to design services to include them. Nearly one in four people in the UK will be over 65 by 2040. A significant proportion of the adult population may never attain the digital skills to use online services without support, because of disabilities or lack of basic literacy skills.

As disruptive start-up businesses mature and their users begin to depend on their services, they face a tradeoff to ensure they provide a stable service while continuing to innovate. For example, for many years Facebook’s mantra for developers was “Move fast and break things”. It highlighted that moving fast was important and that they were willing to tolerate problems with the service to do it. However, just after its user base passed 1 billion in 2014, Facebook changed this to “Move fast with stable infrastructure” to reflect that their users now relied on its services. Having to fix things they had broken was slowing down their rate of innovation. So it is not inevitable that the parts of government which serve people continuously, including the hardest to help in our society, will be automatically digitally transformed. Government needs to drive this actively, to ensure it is achieving the best for the UK, just as businesses and other governments are increasingly making use of these opportunities to rethink their business models.

Citizens rightly expect their experience of government services to be as good as the best consumer services. Government however must also protect citizens’ identity and maintain our national security. So while it should be straightforward, renewing a passport requires much more stringent security processes than an online purchase does.

Critically, technology is now evolving so quickly that it is not the limiting factor in transformation. While the technology must work, the limiting factor is having the right people, with the right skills, working in the right way, in the right places. This strategy therefore places a much greater emphasis on people as the agents of transformation than did the 2012 Government Digital Strategy. Having the right organisational development skills and strong change leadership is as important as having data scientists or developers.

The division of accountabilities between different government departments has in the past resulted in multiple digital strategies, which, although directionally aligned, have not been brought together into a joined-up whole. Different parts of government have reached different levels of digital maturity; combined with their differing purposes, this has led to different approaches.

Even within the most digitally mature departments, there is a risk of creating disconnected business cases for change and missing the opportunity to consolidate demand and drive reuse within their organisational boundaries. In operational departments, the business change strategy and digital strategy now need to be considered as the same thing.

The time is right for us to think more laterally across departments - and for government to have an integrated transformation strategy, enabled by digital practices and technologies.

As government has become better at user-centred design, we have recognised that users’ needs do not neatly align with the organisational structures of government. In response, we are increasingly building services that span multiple departments. This strategy therefore places a much greater emphasis than ever before on the systemic changes required in the centre of government to keep pace with people’s raised expectations, as well as the comparative progress of other countries.

We need to create the conditions for transformation to be successful; the way we operate, govern, approve and deliver needs to match our level of ambition. This means that departments’ transformation plans will need to be produced collaboratively to become increasingly interwoven. Read about GDS’s role in facilitating this process of convergence.

Progress to date in digital government

Government made significant achievements in digital government during the last parliament, including 3 major initiatives that paved the way for successful transformation across departments.

Focus on user needs

A focus on digital service delivery began to realise the possibilities of agile development: continuously iterating services, making the most of online channels and using the potential of modern technologies and data, fundamentally based on meeting the needs of users.

The creation of the Government Digital Service in April 2011 kickstarted this with the launch of the GOV.UK single domain and publishing platform. With help from GDS, departments demonstrated the potential of public service transformation through 25 exemplar projects that radically rebuilt some of the most high volume services to make them ‘digital by default’. This helped save £3.56 billion for taxpayers for the 3 financial years from April 2012 to March 2015. This focus on citizens’ needs has been replicated as a model across the world.

Since then, most of the large departments have been successfully building their internal digital capability and learning from each other, with a focus on hiring world class people. The GDS Senior Civil Service Recruitment Hub has partnered with 19 departments to build their senior leadership talent. 114 permanent and 62 interim digital and technology leaders have been recruited into government via this partnership approach, as well as 91 senior short-term hires who improved our capability to lead transformation across departments.

Agile development is now being carried out with single teams including policy experts, behavioural insight specialists, service designers, analysts, user researchers, front-end developers, server-side developers, testers, infrastructure engineers and data scientists. All work together to create easy to use, secure digital services using the practices of internet-era organisations, while making the necessary connections into, or replacing, complex and interconnected enterprise IT estates.

Focus on building skills and experience in the major programme disciplines

There was also a new focus on building the skills and experience in the major programme disciplines necessary to deliver complex programmes, from infrastructure to business transformations.

These complex programmes are all different but are characterised by their long-running nature, with multiple phases, navigating multiple layers of organisations (transition of staff and locations, for example) and especially by the need to maintain the operation of complicated existing service implementations which must continue while the change is being delivered.

The Infrastructure and Projects Authority (IPA, until January 2016 the Major Projects Authority, MPA) created a world class programme, run in partnership with Oxford University’s Saïd Business School, to train public and private sector participants, who are either current or future Senior Responsible Officers of major programmes, in how to lead complex programmes successfully.

Since the inception of the Major Projects Leadership Academy in 2012, around 300 civil servants have graduated and further cohorts of 100 are currently enrolled or part way through. The MPA also established the Project Leaders Programme, in partnership with Cranfield University, which has seen more than 100 civil servants graduate with improved project and programme delivery and leadership skills, with a further 400 enrolled in current cohorts.

Together with the more established disciplines of external programme reviews by the IPA, these initiatives played an important part in increasing confidence in delivery across the government’s portfolio of major projects, which currently includes 144 projects, with a whole-life cost of £455 billion. Many of these are infrastructure programmes. However, an increasing number, currently around 30 of them, are transformation programmes delivering improvements to citizen-facing services and considerable savings to the Exchequer through more efficient ways of working, enabled by a significant digital component. See the list of the major transformation programmes.

Focus on developing commercial skills

The third major initiative was a focus on developing the commercial skills necessary to get the best from the services delivered under contract.

Each department has a different pattern of service provision, including what is delivered under contract, for example: medical assessment in DWP, offender management in Ministry of Justice (MOJ) and the creation of community rehabilitation companies (CRCs) in the probation sector. Too often, however, virtually all technology services (from design, through software development, to infrastructure and operations) have been delivered under long-running monolithic contracts with a relatively few suppliers.

Since 2010, government has significantly improved the capability of the Civil Service to manage contracts and shape markets, again with a number of senior hires. In addition, it has sought much better value for money and responsiveness, through disaggregating monolithic contracts and beginning to make better use of readily available, competitively-priced technology services where these have become more commoditised.

The case studies included with this strategy demonstrate how these 3 initiatives are bearing fruit and underpinning real changes in how services are delivered.

To support such major initiatives, GDS established standards and policies to help ensure that digital services work consistently for everyone. This included cross-government technology services that provided common hosting, networking and best-in-class workplace technology.

Government now coordinates technology and digital spending centrally. It has freed the public sector to buy from a much wider range of high quality, relevant suppliers. As of November 2016, a total of £1.67 billion (excluding VAT) has been spent through the Digital Marketplace, of which 55% by value has been awarded to SMEs (equivalent of £1.65 in every £3 spent). Since the Digital Marketplace launched as public beta in November 2014, over 3,300 suppliers have registered to offer services to the public sector.

As a result of the progress so far on all of the above, the UK is now seen as a world leader in digital government. In 2016 the United Nations e-government survey ranked the UK top in the world for for both e-government (ensuring public institutions are more inclusive, effective, accountable and transparent) and e-participation (participatory decision-making).

But having shown the way, there is still much to do to ensure that we retain this leadership position. It is now the right time to stand back and identify what is needed to make further progress.

Across government we must create flexible digital infrastructure, and government services that are responsive to changing environments and enable us to iterate and improve existing services in an agile way.

Individual departments have accountability for the creation of the business capabilities they require. However, there is a critical role at the centre to enable departments to evolve and transform their operating models in dialogue with one another. The centre can provide departments and agencies with a collective understanding of what’s going on around them. It can take action to solve problems once when departments are working towards the same outcome.

The role of the centre will be increasingly to supply the intelligence that ensures this ‘situational awareness’ is factored in to the myriad technology and commercial decisions taken across government each day. Doing so will help government converge on a smaller number of non-duplicated capabilities over time.

A coordinated vision across all ministers is needed to transform government - both the services it provides and how it operates - to unlock further gains for citizens and businesses - as highlighted in the sections that follow.