Digital Transformation of Governments

With the advent of the Fourth Industrial Revolution, the private sector has been working on its digital transformation. Companies have been developing change management and digital strategies in order to gain a competitive advantage. Technological advances are also becoming increasingly visible in our daily lives in the form of connected and smart devices. It is only a matter of time that our governments, economies and societies will have to catch up to this technological revolution.

Digital transformation of governments is a colossal task as opposed to a private sector entity implementing some digital solutions in its departments. Even a private company needs to plan its digital strategy and bring its employees on board so as to minimise resistance to change. The public sector would need to put in much more effort and time to plan its digital transformation. A number of countries around the world presently have a digital strategy but infrastructures and public buy-in vary greatly.

A major argument presented in favour of digitalisation is the digital and financial inclusion of the masses. However, the digital and financial divides in different regions are massively disproportionate. Therefore, one digital transformation and change management strategy cannot prove to be effective for all. Some cash-based societies such as those in the Middle East and the Indian subcontinent would find it significantly difficult to move away from paper money due to the size of their populations and economic disparity within their countries. Others, especially smaller countries like Ecuador and Paraguay, would find it easier to impose a swift transition to new technologies and alternative legal tenders such as Bitcoin. Each economy presents its own challenges and risks in terms of cyber security, digital infrastructure, data integrity, digital literacy and willingness of the public to participate in the formal economy.


                                                        Image from Pixabay

Many governments, such as in the UAE and Canada, are also now rethinking traditional ways of maintaining public records and government transactions by treating public-government interaction as a service. Local governments have been working towards becoming smart cities via mobile phone apps, Internet of Things (IoT) and cloud-based technologies. Digital payment solutions, such as Raast in Pakistan, are being deployed in an attempt to document and steer the society towards a cash-less economy.

The availability of new technologies and the closing of the digital divide are also enabling new kinds of business initiatives. Industries revolving around technology are evolving, such as fintech and edtech. One in three startups in the Middle East is founded or led by women due to the ease of working in the tech industry. The traditional methods of raising capital are also in peril as people now have easier access to crowdfunding and alternative sources of lending. The digital age is creating new job opportunities where people need to upskill and reskill.

The pandemic has also demonstrated the need of digitalisation and accelerated its pace. Governments have had to use big data and AI for timely crisis responses. Labour ministries have had to impose teleworking on employees. E-commerce is also growing, as witnessed by the expansion of Amazon and many other local websites in every country. The traditional brick-and-mortar banks, that were already facing some competition from online banks, have also had to reinvent themselves by upping their digital marketing game and with new solutions such as video banking. According to a survey by Deloitte, a huge number of people accessed banking services online for the first time ever during the pandemic.


                                                          Image from Pixabay

These public and private sector initiatives and economic changes have opened up debate about data protection, privacy, ethics and legislation. They have also introduced new risks of identity theft, fiscal and online fraud. There are also environmental concerns raised by the use of technologies like blockchain.  The role of regulators is becoming increasingly important in this context. Therefore, digital transformation for governments now means much more than digitising services and communications. It also includes the aspect of law making, taxation and regulation.

Such a large-scale transformation of society can only be achieved through the determination and commitment of governments that can manage change effectively. Regulators so far have been accused of reacting slowly to technological advancement. If the public wants to hold governments responsible for the provision of legal framework and effective regulation, it also needs to elect officials that are willing to make change happen. Change management and digital strategy are now two-way processes where the government and the public would need to work hand in hand for our digital future.

The author, Aamina Khan, who is also the editor of Ed-watch, is an international polyglot citizen who likes to explore the world differently. A Chartered Accountant by profession, she likes to read and write in various languages as an amateur.

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