- Increasing structural pressure on budgets
The financial crisis combined with the growing pressure for public investments in infrastructure and better public services has put the public sector under an increasing structural pressure worldwide.
Until now this has in most cases been met by traditional ‘budget cutting’ in public services and income transfers. But this can’t do the job any longer.
- Shift of paradigm: continuously increasing innovation and productivity
Instead the public sector has to face a shift of paradigm: just like private sector companies have been accustomed to a continuous increase in customer focused product innovation and productivity to survive in a globalised world, the public sector has to develop an ability to continuous increases in ‘customer’ focused ‘product’ innovation and productivity.
This will demand new ways of thinking for both politicians and bureaucrats: instead of marginal budget cuts or marginal adjustments of public services, it will demand radical innovation and increases in efficiency. Just like the most successful private companies, who often revolutionise their products or services and the way of producing or delivering them.
Let me give you an example of a ‘revolutionised’ public service: the digitisation of property registration in Denmark.
- A ‘revolutionised’ public service: property registration in Denmark
Ten years ago the Danish Government launched an ambitious project on digitisation of all property registration of rights comprising deeds, easements, mortgage deeds etc. for all properties in Denmark. The project was realised in close cooperation with the financial sector.
Today the process is 100 % digitised, i.e. you can only apply for any registration through a web-service or by system-to-system communication from the banks, mortgage institutions or lawyers (‘notaires’).
Around 60-70 % of the processes are fully automated, i.e. all simple cases are judged automatically without human intervention and processed in seconds – as opposed to weeks before.
The business case is strong: the public sector savings are €15 M per year. But the case for the private sector (finance etc.) is even stronger: €50 M per year.
Devoteam was the key technological advisor to both the Danish Government and the financial sector in Denmark.