Australian public sector facing transformation challenges

Australia’s public sector is facing considerable challenges in driving back-office innovation and digital-first strategies, a new study has found.

According to the study, conducted by Vanson Bourne, most public sector decision-makers (88%) agree that back-office transformation makes their roles easier, but 82% believe their staff do not have the right skills and training to adapt to new technologies.

Almost half of respondents said the challenges they faced to adapt were caused by resistance to change by the leadership team, followed by employees’ resistance to change (43%).

Commissioned by enterprise resource planning (ERP) software supplier Unit4, the study also found that public sector bodies are still struggling with their data, with half of Australian respondents (53%) saying their data is compatible across only some applications.

Only 12% have data compatible across all systems, while one in three respondents (32%) are manually entering data into their systems through keyboard, paper or other software systems.

Vanson Bourne also evaluated the digital transformation maturity among public sector organisations and only 9% said they are outperforming in terms of modernising back-office IT systems to enable greater collaboration and productivity.

The vast majority (76%) of respondents were either cautious followers or enthusiastic evaluators, suggesting there is a long way to go before digital transformation reaches every corner of the public sector. In Australia, 96% of respondents said they have a digital transformation strategy, but only 18% consider it fully implemented.

There are also concerns about how ambitious public sector organisations are in their delivery timetables for transformation.

On average, it will take 2.4 years in central government and 2.7 years in local government to fully roll out digital transformation across all areas of organisations, which, given how much has already been spent on digital transformation in the last 10 years, suggests citizens will have some time to wait for completely updated services.

“The global public sector is coming through one of the toughest challenges it has ever faced, but in some ways, it has demonstrated what is possible in terms of digital transformation,” said Mark Gibbison, global director for public sector at Unit4.

“However, organisations face an even tougher task in the years ahead to maintain essential public services and continue to invest in innovation to deliver significant improvements. It will require a mindset shift to embrace the change needed to modernise public services and a willingness to be more agile, accepting that disruption will ultimately lead to far better value for citizens.”

Amid the pandemic, Australia’s public sector has excelled at providing a vast range of services on tight budgets. Transport for New South Wales, for example, was able to analyse the travel history recorded by transit cards and inform commuters whether buses and train services they had been taking were Covid-safe.

“As we look to the future, this industry must continue to enhance its digital capabilities to keep pace with changing consumer behaviours and increasing demands for digital transformation,” said Andy Brockhoff, president of Asia-Pacific at Unit4.

“By leveraging the right tools, Australia’s tech-savvy public sector will continue to meet the needs of Australians everywhere.”

According to the study, the top technology capabilities that Australian public sector organisations are looking at to improve processes and drive efficiencies in back-office systems are cloud migration (50%), data management tools (49%) and real-time reporting tools (47%). Artificial intelligence is the lowest priority (36%).