Is Digital Transformation Delivering on its Promises?

Is Digital Transformation Delivering on Its Promises?

by Andy Melvin, Managing Director, Govtech Solutions Limited.

If you’re managing a complex council service, or struggling to see tangible returns from a seemingly endless investment in “digital solutions”, the answer is almost certainly “No”.

Digital transformation is one of the first answers given to the question “how should councils respond to the challenges they face?”

The challenges are well understood: rising demand for services; an aging population; dramatic increases in the number of “complex cases in crisis”; a 70% reduction in government grant funding since 2010; £6.4Bn of uncollected Council Tax, Business Rates and Housing Benefit Overpayments; an experience pool drained by the departure of long-serving colleagues. And so on.

In response, many councils have adopted programmes to “do more with less” and embarked upon a strategy of digital engagement. The problem is that “do more with less” is now too simplistic. It implies a focus on fewer people. After 9 years of austerity and with rising demand for services, that approach has pretty much run its course. Most digital transformation strategies today are missing a vital component; its absence means attention and investment are focused on the wrong objective.

Digital engagement has indeed made it much easier and cheaper for citizens to request services and report changes. So easy, in fact, that citizens have become somewhat more inclined to do so. Contact levels have risen, often creating backlogs which lead to more contact from citizens checking that their enquiry has been received and acted upon. Meanwhile, channel shift cheerleaders point to rising volumes as evidence of successful digital transformation. But is it?

Digital Process Automation is not Robotics. Think of robots as inanimate data processors. Robotic Process Automation is good at automating dumb, repetitive tasks, such as data entry.

A successful digital transformation strategy should deliver tangible, measurable returns on investment. To generate the largest returns, it must transform both the front office and the back office.

Those witnessing a successful transformation from inside the digital turnstile should be seeing a wholesale switch from silo-based administrative processing and checking to pro-active, holistic intervention and prevention activities, informed and driven by more effective exploitation of data.

The missing component, which prevents digital transformation strategies from fulfilling their promise, is Digital Process Automation.

Digital Process Automation is not Robotics. Think of robots as inanimate data processors. Robotic Process Automation is good at automating dumb, repetitive tasks, such as data entry. But ask a robot to differentiate between a Landlord and a Managing Agent, or a Hostel and a Refuge, and you’ll likely discover just how dumb it is.

Digital Process Automation is much more sophisticated. It is the product of painstaking business analysis which enables day-to-day decision-based processes administered by case workers to be fully automated in accordance with business rules. With Govtech’s webCAPTURE digital process automation service, if an online transaction passes all the business rules, processing and archiving is automated. If a business rule triggers intervention, it is automatically pended, classified as a High, Medium or Low priority item and routed to a work queue. Case workers engage only with matters which require their expertise.

Govtech handled over 2 million online Council Tax transactions last year. Customer-reviewed statistics prove that over 75% of day-to-day workload is fully automated, from a simple Direct Debit to a complex address change resulting from a family breakup, a process which may involve 3,000 steps.

Councils like Kirklees MBC and Bristol City Council have led the way in redeploying resources freed up by Digital Process Automation into other, more valuable activities. Kirklees created a new team to focus on recovery of aged debt; in 3 years, it reduced aged debt by £5m. Bristol invested in specialist training to equip staff to deal with vulnerable people, including those with mental health issues; a successful intervention strategy was resourced in support of the council’s aim to reduce the use of bailiffs and led to the highest ever collection rate in 2017-18. A reduction in aged debt, an improved collection rate and a reduction in the use of Bailiffs are examples of tangible, measurable returns on investment in digital transformation.

Councils are complex organisations delivering multiple services. But they are data rich and information poor. Digital Process Automation can enable much more effective exploitation of data by the application of context. Councils can’t stop the ageing process but, by intervening, they can mitigate and sometimes prevent the consequences of age-related infirmity. A missed payment which simply triggers an arrears process is a missed opportunity; remain incurious about why the payment was missed and you might soon be dealing with a homelessness case. A change in Universal Credit entitlement notified by DWP, due to a change in household composition, can trigger an automatic adjustment in Council Tax Reduction entitlement; but Digital Process Automation can also prompt a review by a social worker if the household contains a Troubled Family, or a child At Risk.

Govtech Solutions Automation Services for Local Authorities

This last example illustrates why returns on investment in digital engagement remain elusive. The absence of Digital Process Automation in transformation strategies means attention and investment remain focused on the wrong objective. Exploiting data which, as in the latter illustration above, by-passed the council’s digital portal is not even on the agenda. The most expensive council services are consumed by relatively few households, often containing vulnerable people who require specialist support. They are almost invariably not using digital channels. In most cases, they are actively engaged with other organisations which share data with councils. The largest returns on investment in digital transformation will flow from exploiting shared data, both internal and external, to identify intervention triggers for households whose independence or sustainability is most at risk. Intervention can prevent a complex case from sliding into a crisis leading to the provision of expensive statutory services. Digital Process Automation enables effective interventions, the returns from which are peerless.

Meanwhile, the digital transformation strategy is focused on providing an Amazon-type My Account for citizens who don’t consume many council services. Rather than focus on the potential consequences for vulnerable citizens of everyday life events and changes communicated from multiple sources, councils are tied up in knots over the complexities of mapping and reconciling internal data in multiple systems and making it available to people who haven’t asked for it.

They are seeking to meet a need which doesn’t exist, isn’t that valuable and won’t make much difference to the cost of service provision. Most citizens are agnostic. They are content if they can submit a request online, view an account and receive an electronic bill. One large council has invested heavily in creating and promoting its My Account. In the last 4 months, it has received over 9,000 online changes of address. 8% of these were mediated by council staff, 12% were submitted by citizens via My Account and 80% were submitted by citizens online without logging in. This illustrates that, while there may be some value, there is no citizen-led demand for an all-singing, all-dancing My Account; for many, it would simply be a rarely-used bookmark in a browser.

A successful digital transformation strategy should focus on exploiting Digital Process Automation to free up skills and resources and enable better use of them through effective exploitation of data. With continuing budget constraints, making more resources available to focus on intervention and prevention is vital to managing demand for expensive statutory services.

The benefits and savings that flow from this are enormous. They are the promises digital transformation strategies must deliver.