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13
2. Digital transformation in the public
sector
Miriam Lips
INTRODUCTION
Governments around the world are increasingly using digital technologies
and data to fundamentally change their core functions, structures, operations,
processes, activities, and relationships with stakeholders, including citizens,
businesses, other government organizations, and civil society (Lips, 2020).
These digital transformations are facilitated by fast-moving developments in
the area of digital technologies, such as the Internet and other digital network
infrastructures, social media, mobile technologies and devices, smart technolo-
gies, robotics, and artificial intelligence (AI). Another fast-moving technologi-
cal development, which is further adding to the digital transformation potential
available to governments and is particularly enabled by smart technologies
and devices, is the creation of large volumes of data (e.g., Borgman, 2015;
Gil-Garcia et al., 2016; Kitchin, 2014; Lips, 2020; Meijer and Bolivar, 2016;
van Zoonen, 2016).
However, digital transformation in the public sector is not a straightforward
process but can be seen as a complex issue. For instance, it is important to
consider that digital transformation in the public sector is not caused by digital
technology and data but is a complex process of mutual shaping between
actors, technologies, institutions, economic factors, political factors, and
socio-cultural factors (see also the next section). Also, digital transformation
doesn’t happen in a vacuum: in other words, governments haven’t stopped
their operations and activities in order to undertake a complete “reset” in the
digital age, but they are adopting digital technologies and new forms of data
use whilst they are dealing with business as usual (BAU).
Moreover, there are substantial risks involved for governments to undertake
digital transformation initiatives, which are not attractive from a political lead-
ership point of view: for example, many digital transformation initiatives in
the public sector fail (Lips, 2020). Another substantial risk is that as the costs
involved with digital transformation initiatives are so significant, many gov-
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14 Collaborating for digital transformation
ernments are reluctant to take on large-scale government technology projects
that will have a major impact on their structures, functioning, and external rela-
tionships. Although the intended outcomes of digital transformation are diffi-
cult to achieve, it is clear that compared to the paper-based past, governments
are fundamentally different in their operations as a result of digital transfor-
mation, which potentially could lead to increased effectiveness and efficiency.
For example, a study conducted by McKinsey and Company (Dilmegani et
al., 2014) suggests that capturing the full potential of digital transformation
in the public sector could free up to US$1 trillion annually in economic value
worldwide, through improved cost and operational performance.
In this chapter, we will further explore this concept of “digital transforma-
tion”, and more specifically what it means in the public sector. First of all, we
will explore a theoretical perspective on the process of digital transformation
in the public sector, and in particular the role of technology, in the second
section. In the third section, we look at how scholars have given meaning to the
concept of digital transformation. We will be able to compare these scholarly
meanings with forms of digital transformation in the public sector which have
emerged in worldwide practice in the fourth section. And finally, not all digital
transformation initiatives end up in failure: we can learn what has worked
effectively from empirical research into successful digital transformation
initiatives in the public sector. Ten success factors of digital transformation
initiatives in the public sector will be discussed in the fifth section.
MUTUAL SHAPING OF DIGITAL TRANSFORMATION
IN THE PUBLIC SECTOR
Digital transformation in the public sector commonly is seen as a development
that started with governments’ adoption of the Internet in the 1990s. However,
the application of IT in government was not a new phenomenon at the time.
Government computing had existed already for many years, with the first com-
puters in government being used to perform simple mathematical calculations,
such as data processing as part of the census in the USA (Agar, 2003; Lips,
2017). From the 1950s until the 1980s, governments started working with big,
centralized mainframe computing machines for the execution of large-scale
numerical processing tasks (Agar, 2003; Bellamy and Taylor, 1998; Lips,
2017). This particularly concerned government agencies responsible for
storing and managing large quantities of data, such as tax authorities, social
welfare departments, and national census bureaus. Introduced in government
departments in the 1980s, personal computers (PCs) were initially used for
word processing, calculation, data processing, and programming and became
ubiquitous throughout government agencies (Bellamy and Taylor, 1998).
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15
Digital transformation in the public sector
With the introduction of server-based networked computing, the PCs of
public officials could be connected to the Internet, for example, which led to
a shift away from centralized mainframe computing towards decentralized
network computing in government (Lips, 2020). This trend continued with
the introduction of more recent technologies. The Internet has already been
mentioned as a digital technology that has an important impact on decentral-
ized ways of working in government agencies, but also other digital network
infrastructures, such as cloud computing, have had an effect of networked,
decentralized access to data and information. Other more recent digital tech-
nologies that have a profound effect on government agencies are social media,
mobile technologies and devices, smart technologies, robotics, and AI.
However, the influence of early IT solutions on government should not be
underestimated. For example, governments continued to use centralized main-
frame computing systems in parallel with decentralized network computing
solutions after their adoption of the Internet. The operation and use of existing
older digital technologies and IT systems in government is also referred to as
“legacy systems”. Legacy systems often have a profound impact on digital
transformation initiatives, as governments have the costs of operating and
maintaining these older operational systems whilst making investment deci-
sions about the adoption of new technology.
However, although digital technology and data are prominent in digital
transformation initiatives, they should not be seen as solely or in a linear way
responsible for the societal outcomes: actual achievements in digital transfor-
mation initiatives in the public sector will not be determined by the technology
per se, but by deep-seated social, institutional, legal, political, economic and
cultural processes and structures, leading to fragmented and evolutionary out-
comes (Bellamy and Taylor, 1998; Dutton, 1997; Fountain, 2001; Garnham,
1996; Lips, 2020). The relationship between digital technology and society can
be characterized as a perspective of mutual shaping: digital technology and
society influence and shape each other and, as a result, are mutually constituted
rather than being neutral, mutually exclusive, and separate (Lips, 2020). Social
choices between different technical options are made at every stage in the
design, development, and use of the technology. These choices are not always
conscious decisions; selected options depend on a wide range of technological
and social factors, which, in interaction, co-shape the direction and outcomes
of the technology itself and the societal change process it enables (Williams
and Edge, 1996).
In general, when applied to digital transformation initiatives in the public
sector, what this mutual shaping perspective reveals is a dynamic, complex,
and incremental working together of digital technology capabilities, on the one
hand, and socio-cultural, economic, political, institutional, and organizational
factors, on the other (Lips, 2020). In other words, the design, development, and
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16 Collaborating for digital transformation
use of digital technology can be understood as a social phenomenon: an inex-
tricable part of society (MacKenzie and Wajcman, 1999). As social factors are
context-dependent and co-evolve with technology, societal change outcomes
of this mutual shaping too are contingent and unique due to different social,
cultural, institutional, and historical circumstances within a particular context
(Lips, 2020).
This mutual shaping perspective, which is also known as the social shaping
of technology (MacKenzie and Wajcman, 1985), explains why the same
digital technology may be designed, developed, and used differently in differ-
ent contexts at a particular moment in time, leading to varying outcomes (Lips,
2020). It also explains why there is often a mismatch between intentions for
or expectations around a particular technology and the actual experience with
this technology: in other words, why digital technologies often fail to deliver
on predicted outcomes (Lips, 2020). In accordance with this mutual shaping
perspective, the journey towards outcomes of a digital transformation initia-
tive can be conceptualized as a complex negotiation process between various
actors and technological, social, and institutional factors in a particular context
(Latour, 1986). Several scholars also emphasize the critical role of users
as co-shapers of digital technology within this mutual shaping eco-system
(Dutton, 1999; Oudshoorn and Pinch, 2003; Williams and Edge, 1996).
This points to the critical importance of empirical observations and analysis
in order to understand the mutual shaping of digital technology and govern-
ment actors and their varying impacts, outcomes, and implications (Brown
and Duguid, 2000; Castells, 1996; Woolgar, 2002). Empirical research in the
context of digital transformation in the public sector has confirmed that digital
technology- and data-related change in government should not be considered
a rational, predictable, rapid, or straightforward process but an extremely chal-
lenging, unpredictable, complex, evolutionary, and non-linear course of action
(Bellamy and Taylor, 1998; Eppel and Lips, 2016; Fountain, 2008; Lips, 2012;
McLoughlin et al., 2013).
Digital technologies and data form critical parts of complex socio-technical
assemblages positioned within the context of digital transformation initiatives
in the public sector. Besides digital technologies and data, these socio-technical
assemblages are made up of people and communities, users and stakeholders,
government organizations and institutions, businesses, political leadership,
public sector norms and values, democratic and ethical arrangements, legal
and regulatory arrangements, budgets, policies, processes and procedures,
forms of knowledge and experience and practices and activities (Lips, 2020). If
we want to understand how digital technologies and data are being introduced,
managed, and used in the context of digital transformation in the public sector,
we will need to focus on the socio-technical assemblage as a whole and not just
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17
Digital transformation in the public sector
on the digital technology and/or the data per se (Ananny and Crawford, 2018;
Bellamy and Taylor, 1998; Fountain, 2001; Kitchin, 2014; Lips, 2012, 2020).
Fountain offers an institutional perspective of the use of digital technology
or enacted digital technologies as she calls it, in socio-technical assemblages
in government and, with that, insights into the strategic role of digital tech-
nologies in the public sector in the following three ways (Fountain, 2001,
pp. 195–6):
1. Enacted digital technologies are tools of politicians, public decision-makers,
and public managers. These tools can be used or misused.
2. Enacted digital technologies become a vital digital infrastructure in
governments. Once adopted, designed, and constructed, these digital
technologies become part of the institutional settings of government
organizations. Important influencing factors here are the high sunk costs
of large digital transformation projects and the legislative arrangements
that have been put in place to legally embed these digital technologies in
the fabric of government. This situation not only influences future actions
in government organizations but also creates a tendency to persist with
this digital infrastructure even when technology changes rapidly, as insti-
tutionally embedded digital technologies are difficult to change.
3. Enacted digital technologies serve not only as enablers of change across
government but even more so as strong catalysts for change within
individual government organizations as they promise dramatic effi-
ciency gains, productivity improvements, and more control. This strategic
alignment between digital technologies and the interests of government
organizations makes it difficult for public managers to resist using these
technologies to produce such organizational promises; the institutional
design of the bureaucratic state overwhelmingly structures behaviour
within government agencies rather than between agencies.
Fountain (2001) also empirically observed at the time that in many cases in
government, public officials used digital technologies in order to sustain or
strengthen what she refers to as “deep institutions” or the history and culture
encoded in the existing norms and values of a government organization. This
phenomenon, which is also known as the “reinforcement thesis”, acknowl-
edges technology enactment by public sector decision-makers in ways that
leave institutional structures and processes undisturbed or even reinforce and
strengthen the institutional status quo (Fountain, 2001; Kraemer and King,
2006).
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18 Collaborating for digital transformation
SCHOLARLY MEANINGS OF DIGITAL
TRANSFORMATION IN THE PUBLIC SECTOR
In the last few decades, the transformational potential of applying digital
technologies and data in government has strongly captured the interest of
scholars (Taylor and Lips, 2008). Especially in the early days of the public
Internet in the 1990s, but also more recently as a result of the arrival of new
technologies, some form of radical transformation in the public sector was
seen as an inevitable and often desirable outcome of the rapid technological
developments that were happening in society at the same time (Lips, 2014;
Taylor and Lips, 2008). A well-known example in the early days of the public
Internet was that the application and use of the Internet would lead to a more
horizontal, decentralized network society (Castells, 1996). However, as dis-
cussed earlier, the transformational potential embedded in digital technologies
should not be considered a given; instead, digital transformation outcomes
depend on the actual use of digital technologies and data as part of a particular
socio-technical assemblage (Lips, 2020).
Moreover, although many scholars and practitioners have used “transforma-
tion” as a key concept to explore changes in the context of digital transforma-
tion initiatives, the meaning of this concept is usually ambiguous, ill-defined,
or not defined at all (Lips, 2017; O’Neill, 2009). The meaning of the concept
usually is associated with some form of fundamental change related to the
application and use of digital technologies and data in the public sector (Lips,
2020). Based on empirical research in New Zealand, O’Neill (2009) offers
a further distinction of the meaning of transformation in two separate ways:
1. Instrumental transformation: a radical change in the existing admin-
istration, information management, and service delivery practices of
government agencies that may also have a consequential impact on
organizational structures and/or management practices. This application
of transformation often results in less disruptive changes to operational
and management practices that deliver benefits of increased speed, better
quality of government service, and lower transaction costs and can be
described as “doing the same things differently”.
2. Systemic transformation: a radical, disruptive change in existing govern-
ance arrangements in the public sector, including constitutional respon-
sibilities and accountabilities, fiscal management, legislation, regulation,
and decision-making rights over public resources. From this perspective,
transformation is also about a disruptive, fundamental change in key
institutional and democratic relationships, such as between government
and citizens, within a broader systemic order. Therefore, systemic trans-
formation is about “doing different things”.
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19
Digital transformation in the public sector
Several scholars have used the term “transformation” also as an ideal type for
fundamental changes in the public sector related to the application and use of
digital technologies and data: several maturity models for digital government
have been distinguished, with the final stage being identified as “transforma-
tion”. These maturity models all indicate a linear development towards better,
mature, and transformed digital government (Andersen and Hendriksen, 2006;
Klievink and Janssen, 2009). As an example, the following four-stage maturity
model has been developed by Layne and Lee (2001):
• Stage 1 – catalogue: representing the presence of a government organiza-
tion on the Internet;
• Stage 2 – transaction: users can do transactions online with the government;
• Stage 3 – vertical integration: the integration of a functional area across
either one hierarchical government organization or different administrative
levels; and
• Stage 4 – horizontal integration: the integration of processes and activities
within and across different public sector organizations.
Another example is the following five-stage maturity model developed by
Klievink and Janssen (2009, p. 278):
• Stage 1 – Stovepipes: few applications, public services or products are
interconnected, and data are not shared between government organizations.
• Stage 2 – Integrated government organizations: public service delivery
and digital technologies within government organizations are integrated to
create a one-stop shop at the organizational level.
• Stage 3 – Nationwide portal: a nationwide government portal is introduced
to provide access to existing government products and services, including
a digital vault personalized for each individual citizen. The digital vault
can be used to provide government organizations with access to citizens’
personal data when their public services and products are being requested.
• Stage 4 – Inter-organizational integration: clearly defined and standard-
ized cross-agency services are bundled and integrated and can be delivered
as virtually one service via the portal.
• Stage 5 – Demand-driven, joined-up government: instead of citizens
having to find and apply for government services, the portal will search for
the relevant public services and make recommendations.
A further example of a maturity model that leads to digital transformation is
the open government maturity model developed by Lee and Kwak (2012). This
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20 Collaborating for digital transformation
maturity model consists of the following five stages toward transformed open
government (Lee and Kwak, 2012, p. 496–9):
• Stage 1 – Initial conditions: no or few open government capabilities exist,
and social media are hardly used. The focus is on presenting and broadcast-
ing information to the general public;
• Stage 2 – Data transparency: high-value, high-impact government data are
published online and shared with members of the public. Data quality is
assured in terms of accuracy, consistency, and timeliness;
• Stage 3 – Open participation: interactive communications with members
of the general public are established around open government data, includ-
ing participatory opportunities for public feedback, conversation, voting,
and crowd-sourcing;
• Stage 4 – Open collaboration: inter-agency collaboration and open col-
laboration with members of the general public around open government
data are established. The focus is on co-creating value-added government
services; and
• Stage 5 – Ubiquitous engagement: public engagement around open gov-
ernment data becomes easier for members of the general public and uni-
versally accessible through mobile and ubiquitous computing devices and
applications. Also, open government data, public engagement methods,
social media tools, and government services are seamlessly integrated
within and across government agencies so that the public can easily navi-
gate and engage in various open government activities.
The benefits of achieving higher stages of digital transformation on these
maturity models have been identified by Foley and Alfonso (2009). Based on
research data from 28 digital government projects in one of the OECD member
states, they found that the net benefits substantially increase when digital gov-
ernment projects are moving from the transaction stage into the transformation
stage.
EMPIRICAL FORMS OF DIGITAL TRANSFORMATION
IN THE PUBLIC SECTOR
From an empirical perspective, when we consider digital transformation
initiatives where governments have fundamentally changed their core func-
tions, structures, operations, processes, activities and/or relationships with
stakeholders, including citizens, businesses, other government organizations,
and civil society, we can observe the following forms of digital transformation
around the world (Lips, 2020). First of all, forms of service transformation
can be observed, where governments have fundamentally changed their public
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21
Digital transformation in the public sector
service provision to users. A particular form of service transformation is inte-
grated government. This development is a shift away from government-centric
ways of providing public services towards more customer-centric ways of
public service delivery. The following three integrated government transfor-
mation areas can be distinguished:
1. Virtual integration, such as public services provided through integrated
web portals;
2. Vertical integration of public services provided in different policy
domains or government sectors, such as all public services provided in the
wider social sector, through integrated government counters or “one-stop
shops”;
3. Horizontal integration of the front and/or back offices of government
organizations.
Digital technologies, such as cloud computing, are considered critical enablers
of joining up and integrating government front and back offices. A special
mention needs to be made for digital transformation in the area of so-called
shared services, or the horizontal integration of back-office services across
government agencies in areas like finance, procurement, and human resources
management.
Another form of service transformation is citizen-centric government.
This form of service transformation became popular amongst governments
in response to narrower customer-centric thinking in public service delivery.
Citizen-centric government acknowledges the unique nature of the gov-
ernment’s service relationships with citizens in the following ways (Lips,
2017; OECD, 2009a): firstly, the acknowledgement that citizens’ rights and
obligations are different from more narrowly defined customer rights; and
secondly, that governments need to balance the distinct interests and needs of
different groups of citizens within the broader framework of the public inter-
est. This implies that governments cannot use a one-size-fits-all approach in
their public service design and, consequently, need to shift from a traditional
government-centric service provision paradigm towards a more differentiated
citizen-centric service design paradigm (Lips, 2017; OECD, 2009a).
The main difference between a traditional government-centric paradigm and
a citizen-centric paradigm is the following (OECD, 2009a): where a traditional
government-centric paradigm takes an “inside-out” perspective by emphasiz-
ing the organizational logic and coherence of government, a citizen-centric
paradigm takes an “outside-in” perspective by emphasizing the context of
the citizen and their specific service needs. This then creates an external,
citizen-centric logic for organizing government service provision and leads
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22 Collaborating for digital transformation
to the following characteristics of citizen-centric government (OECD, 2009a,
2009b):
• Taking an “outside-in” instead of an “inside-out” perspective;
• Individuals are not just customers of government agencies, but citizens
with rights and duties;
• Many “customers” of government are “involuntary customers”;
• An externally focused, citizen-centric logic for organizing government
service provision;
• Providing integrated government services tailored to the individual needs
of citizens;
• Allowing for cross-government data sharing to support personalized
government service provision and remove duplicated efforts of citizens to
provide personal data to government;
• Co-design of government services between government organizations and
citizens;
• Collaboration between multiple service providers depending on the citi-
zen’s service needs; and
• A networked perspective of the wider public sector.
An example of how digital technologies can facilitate citizen-centric gov-
ernment is the application of the so-called life event model in public service
provision. First introduced and used by the Singaporean government, this life
event model clusters, integrates, and presents government information and
services in accordance with major life events of citizens, such as looking for
work, setting up a business, buying a house, having a child, and retiring (Lips,
2020). Another practical example of citizen-centric government is the intro-
duction of administrative simplification initiatives in governments around the
world, where citizens do not need any longer to submit the same personal data,
such as the change of an address, over and over again to multiple government
organizations but only need to tell government once (Lips, 2020).
Another form of service transformation is digital-by-default government.
Especially popular during the recent Covid-19 pandemic, governments have
replaced traditional paper-based and face-to-face service channels with
a variety of digital channels (e.g., web services, smartphone apps, SMS, social
media) and data as their standard way or default setting in government service
provision (Lips, 2014). In general, there are six main reasons why govern-
ments want to become digital by default (Lips, 2014, p. 183):
1. To follow fundamental changes in society and seize the digital opportu-
nity to transform themselves;
2. To promote substantial efficiency and cost savings;
3. To become customer-centric and provide better quality services;
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23
Digital transformation in the public sector
4. To improve the availability and accessibility of open government data;
5. To move away from siloed approaches and duplications across the public
sector by introducing common digital technology platforms; and
6. To promote the adoption of digital public services through enhanced
security and privacy protection.
The following two main approaches can be observed in governments becom-
ing digital by default (Lips, 2014): a service-centric approach, which converts
traditional ways of government service provision into digital equivalents, and
a data-centric approach, which makes open government data publicly avail-
able for use to create new information products, services, and applications
that are most useful to consumers of that information. Another substantial
difference in national digital-by-default government service reform strategies
can be found in the implementation focus (Lips, 2020). For instance, some
countries (e.g., the UK, Australia) focus on developing digital-by-default gov-
ernment services at the level of individual government organizations, whereas
other countries (e.g., USA, Denmark) focus on developing government-wide
digital-by-default solutions, such as open government datasets and public reg-
isters, which can be used in government-agnostic, programme-agnostic, and
device-agnostic ways (Lips, 2014, p. 186).
Secondly, we can observe business transformation in government agencies
around the world: the fundamental change in government organizations’
structure, culture, processes, and activities. An important part of business
transformation includes changes in how business is conducted, or the organiza-
tion’s operations, such as the change of traditionally paper-based systems into
information systems which are enabling the operation of digital government.
Good examples are the building of identity management systems, payment
systems, and basic registrations or shared datasets across the government.
Another example of business transformation is in the area of digital security.
SUCCESSFUL CONDITIONS FOR DIGITAL
TRANSFORMATION IN THE PUBLIC SECTOR
Empirical research in New Zealand has pointed towards ten success factors
for achieving digital transformation in the public sector. A successful digital
transformation initiative can be identified as a project that is in use and has
realized benefits for users and the project owner (Eppel and Lips, 2021a,
2021b; OAG, 2012).
First of all, having strong support from leaders and senior managers is an
important success factor for digital transformation in the public sector. Ideally,
strong effective leadership is both delivered at the political level and at the
senior management level in government (Eppel and Lips, 2016; OAG, 2012;
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24 Collaborating for digital transformation
Sikkut, 2022). Empirical research in six successful digital transformation
projects in the New Zealand public sector showed that strong leadership and
support from main stakeholders, such as ministers and senior managers (OAG,
2012, p. 53):
• are critical to effectively realizing benefits in digital transformation
projects;
• can help to accelerate critical decisions, resolve resource blockages, set and
manage realistic expectations, and add impetus to a project; and
• are particularly important for the reporting stages, when information about
the project is given to people outside the project for them to make decisions
‒ this includes the business case and benefits planning and reporting stages.
Effective leaders in digital government initiatives are often facilitative leaders,
bringing people and stakeholders together and facilitating collaboration (Eppel
and Lips, 2016, 2021a). Facilitative leadership was also required in the New
Zealand-based Landonline case study as a result of the adoption of agile ways
of working (Eppel and Lips, 2021a): it included senior executives finding
ways to allow people working in development teams to take risks and make
decisions within certain boundaries (guardrails) without having to first get
permission from higher up the chain. The potential for a mistake or what
was retrospectively seen as a poor decision was limited by the parameters of
the guardrails and the ongoing stocktake and review processes of the agile
methods used.
Based on an empirical study into effective leaders of digital transformation
in government, Sikkut (2022, pp. 279–85) lists the following ten themes as
lessons learned for delivering digital transformation best practice:
1. Managing for delivery – through remaking or creating policy, strategy,
organizational structure, processes, team, culture, values, routines, effec-
tive leaders need to organize and lead for delivery. If effective leaders
deliver, they will build credibility. This may be a prerequisite to be able to
ask for levers or resources from superiors or build up soft power to ensure
collaboration from other stakeholders, and get support from the public too
(Sikkut, 2022, p. 280).
2. Strategy setting – a skilful strategist can use a strategy to build up the port-
folio of activities and create a roadmap for lasting change. Setting a clear
vision, an ambitious strategy, and an achievable action plan also can help
to make delivery easier, because it can empower the team or rally other
stakeholders behind (Sikkut, 2022, p. 281).
3. Strong political support – in some cases, strong political support from the
highest-possible level in a country turned out to be the most fundamental
precondition for successful digital transformation. Effective political
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25
Digital transformation in the public sector
support goes beyond recognition, with political masters needing to take
actual steps to give digital transformation leaders the institutional levers
for coordination and delivery across the government or through the power
of their office to mobilize stakeholders.
4. Stakeholder management and networking – to mobilize resources and to
ensure necessary collaboration for delivery.
5. Good communications – effective communications can deliver benefits
including strong public support, stakeholder buy-in, political backing,
and talent recruitment. This was also an evident success factor in the
Landonline and MyACC for Business case studies (Eppel and Lips,
2021a, 2021b).
6. Building the best possible team – to get the most potential out of a good
team, people can be empowered with an enabling management style and
routines, and a needed culture and values can be instilled.
7. Working for lasting change – lasting change is important as government
agencies can be quite resistant to long-term change and fall back to previ-
ous ways of working. Most lasting change potential comes from building
up strong and mature teams that can keep going without prior leaders,
from leaving behind a strategy for the next years, and from building
up a culture that is different from what was there before (Sikkut, 2022,
p. 283). Another way of working on lasting change would be to embed
changes into the machinery of government: policies, standards, laws,
institutional arrangements, or international donor assistance deals are all
ways to make it harder for successors to undo changes made. However,
the best way to ensure continuity and make changes last is delivery: the
creation of digital transformation solutions of a new quality that meet
people’s needs (Sikkut, 2022, p. 284).
8. The job is hard: be ready for it – if effective leaders want to keep deliv-
ering and achieve any impact, they should be sure to maintain their own
stamina and keep a clear mind (Sikkut, 2022, p. 284).
9. Fix your sight on the users: the impact on citizens and businesses – effec-
tive leaders focus on the bigger picture: the mission and vision. This
includes keeping their sight on the users and the impact they make on their
lives through transformed digital services.
10. Effectiveness is in the hands of the effective leader – mindset and approach
make all of the difference. Relevant experience, including an ability to
handle challenges, is critical for this role.
Secondly, understanding the environment and making the most of the circum-
stances have been identified as an important success factor for digital trans-
formation initiatives (OAG, 2012). More specifically, the empirical research
found identifying increasing or future demand for services as an impetus for
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26 Collaborating for digital transformation
change and recognizing extreme or special circumstances of a given situation,
including the impetus of limited time and treating this as an opportunity,
as important ways to make the most of circumstances (OAG, 2012). The
latter was, for instance, found in Christchurch with the establishment of the
Christchurch Earthquake Support Syvstem, where digital services had to be
delivered within a few days of the 22 February 2011 earthquake.
Thirdly, another success factor of digital transformation initiatives is using
a business-led, flexible, and agile approach. The six successful projects that
were studied in 2012 and the two more recent case studies published in 2021
all had a focused business purpose: there was an important acknowledgement
in these projects that technology is not an end in itself but that a clear busi-
ness purpose guides how the technology is used. In the case of the MyACC
for Business case study, technology was seen as an important enabler of the
envisioned organizational transformation roadmap, or a servant of business
transformation. In this case, the use of technological solutions sat alongside
organizational and cultural change and a central focus on the government
agency’s customers (Eppel and Lips, 2021b).
Because the six digital transformation projects and the two case studies all
had a business focus, it was important to involve people who know a lot about
the business, such as business owners. Other commonalities of the six suc-
cessful projects were that they don’t try to solve everything at the same time,
they followed an iterative or pilot approach, and they used current technology
where it makes sense to and did not reinvent solutions (OAG, 2012, p. 51). The
two more recent successful digital transformation case studies also followed an
agile, iterative approach. In the case of Landonline, during the transformation
process, the organization had come to accept the transformational potential
of the Landonline rebuild as an organization-wide challenge (Eppel and Lips,
2021a).
A fourth success factor of digital transformation initiatives is collaboration.
Empirical research into six successful digital transformation projects shows
that successful project teams have strong and collaborative relationships
within the project team, with vendors, and with stakeholders, including other
government agencies involved and end users (Eppel and Lips, 2016; OAG,
2012). The two more recent case studies point out the importance of internal
collaboration between the business owners, the digital teams for achieving
successful digital transformation and the teams responsible for customer
engagement (Eppel and Lips, 2021a, 2021b).
Fifthly, a strong success factor of digital transformation initiatives is
co-design and user-centricity. Empirical research into six successful digital
transformation projects shows that successful project teams pay a lot of
attention to users’ experiences, and the two more recent case studies point out
that the feedback and experience of users is critical to the development of the
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27
Digital transformation in the public sector
digital transformation solution, in line with the application of an agile approach
(Eppel and Lips, 2021a, 2021b; OAG, 2012). Feedback from customers as the
digital transformation solution was rolled out both allowed the product to be
improved but also provided heart and encouragement to the developers that
they are on the right track and building a product that is valued by customers
(Eppel and Lips, 2021a).
Sixthly, of critical importance for successful digital transformation initia-
tives turned out to be the use of the right technology tools for a given set of cir-
cumstances or strategic, fit-for-purpose technology choices. The MyACC for
Business case study also pointed to the requirement of a timely replacement of
legacy systems. Empirical research into six successful digital transformation
projects pointed at the following technology tools (OAG, 2012): agile method-
ologies, open data, and open-source technology tools. More recent empirical
research confirms the critical importance of using agile methodologies in
successful digital transformation initiatives (Mergel et al., 2018, p. 291): gov-
ernments need to adapt to changes in their internal and external environments
and create systems that allow them to scan trends, identify developments,
predict their potential impact on the organization, and quickly learn how to
implement changes to their standard operating procedures. Agile methodolo-
gies enable government agencies to become more flexible, adaptive, and rapid
in their behaviour (Mergel et al., 2018). In the case of the Landonline case
study, adopting an agile delivery method enabled an incremental approach to
build fit-for-purpose in-house capacity and using user insights to inform the
development of the system (Eppel and Lips, 2021a), multidisciplinary devel-
opment squads were recruited to provide the capability to build quickly and
well to meet user needs and work with end users on adoption. The MyACC for
Business case study shows that the adoption of an agile approach was a delib-
erate decision in support of the agency’s customer-centric strategy (Eppel and
Lips, 2021b).
A seventh success factor in digital transformation initiatives is organizational
openness to new ways of working. The decision to build the new Landonline
product in-house necessitated some rethinking of how the responsible govern-
ment agency organizes itself internally to do things and who is responsible for
what (Eppel and Lips, 2021a). As the Landonline build became operational,
it threw new light on business as usual and organizationally entrenched ways
of working. In many cases, they were practices buried in (often long) history.
A new technology application became an opportunity to consider whether they
are still needed and the most efficacious.
An eighth success factor in digital transformation initiatives is fit-for-purpose
governance and accountability. In the case of the Landonline case study, the
initial governance process for the new system involved only a subset of the
agency’s senior executive team and some external digital governance experts
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28 Collaborating for digital transformation
who operated as a governance board (Eppel and Lips, 2021a). This arrange-
ment risked overlap and conflicting responsibilities and accountabilities with
the organization’s executive leadership team. Gradual wider organizational
realization of Landonline’s transformational potential prompted a rethink
about its governance: the original governance process was reformed to take
account of Landonline’s impact on the organization as a whole and included
the full executive leadership team and the chief executive. The government
agency also needed to change governance processes to fit with agile delivery
methods, as was required in the MyACC for Business case study, and needed
to convince Treasury and ministers of the need for different arrangements for
accountability reporting, and funding drawdowns to match the more continu-
ous delivery of an agile project (Eppel and Lips, 2021a, 2021b).
Ninthly, a success factor for digital transformation initiatives is change
management and fit-for-purpose internal capability and processes. In the case
of the Landonline case study, the government agency realized that it is not the
technology alone that is changing but the organization is also changed by the
technology and must be prepared to adapt and operate differently if full benefits
are to be realized (Eppel and Lips, 2021a). A longer-term, capability-building
view was taken in thinking about the capacity needed internally to build and
maintain the new Landonline system.
Lastly, a tenth critical success factor in digital transformation initiatives
is a clear articulation of the benefits, and routine monitoring of the benefits
being realized (OAG, 2012). Effective benefits realization needs to be treated
as a dynamic, continuous process of documentation and review of benefits.
Using an agile methodology enabled the government agency to deliver ben-
efits progressively along the way, rather than waiting some years for a fully
developed product to be launched to realize those benefits (Eppel and Lips,
2021a, 2021b).
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