Workday Global Study: Government Leaders Say Data Silos Are Hampering Digital Transformation

The pandemic pushed government agencies to digitize public services in ways that had never before been possible. But more recently, momentum has slowed. Rather than building on their tech successes, many government agencies are pressing pause on digital transformation plans.

“Closing the Acceleration Gap: Toward Sustainable Digital Transformation,” Workday’s global survey of 1,150 senior executives, found that 55% of government leaders say the pace of digital transformation has slowed from where it was a year ago, or they expect it to slow down in the future. And only 20% of government leaders expect at least half of their revenues to be digitally driven within three years. That’s down from 53% in 2020.

One explanation? Rowan Miranda, senior managing partner for government strategy at Workday, says ”Governments are taking the seemingly easier route of investing lesser amounts by upgrading and patching legacy systems just to get by for now.” 

Government leaders are taking this path more than their peers in other industries. Only 9% of government leaders say that at least half of their daily operations are digitized, compared to 18% of all leaders surveyed. And only 1 in 5 government leaders say they’ve made progress deploying technologies to streamline or automate workflows and augment the capacity of the existing workforce, compared to 1 in 3 of all leaders.

While this strategy may appear to cost less in the short term, it doesn’t solve the persistent problems facing government agencies. To provide more efficient and effective public services, government executives and managers must also address process inefficiencies, cybersecurity weaknesses, poor decision support,data access, and costly systems maintenance.

“The main risk of deferring digital transformation are resources being spent on overhead activities rather than on citizen services,” says Miranda. “Then there’s the difficulty retaining government staff who are accustomed to modern technology tools in their everyday lives and will seek out alternative employers that use them, given the competitive nature of the labor market today.”

Data Silos Impede Public Services

Streamlining public services can help agencies spend their money much more effectively. But to find big efficiencies, government leaders need data-driven insights—and most are still struggling on that front. Our survey found that only 2% of government leaders say their organization’s data is fully accessible, while 61% say it’s either somewhat or completely siloed. 

“Governments are decentralized organizations,” says Miranda. “The larger they get, the more authority is fragmented. Systems get built piecemeal at the agency level, and soon information becomes siloed.”

This fragmentation makes it difficult for leaders to respond quickly to a crisis or change. Our survey found that 59% of government leaders say their inability to connect operational, people, and financial data to business outcomes harms the organization’s agility. The survey also discovered that 80% of government leaders believe the ability to integrate data between disparate systems is the most important factor in improving their ability to make real-time decisions.

Connecting these systems, though, is no easy task. State and local governments typically have multiple elected officials and department heads who often operate autonomously. 

“It’s hard to approach IT investments in an enterprise manner when there are so many different silos and power centers,” says Miranda. “Piecemeal investment in systems using different vendor and technology standards is the principal reason data access and analysis is so frustrating in government.”

A Need for Speed 

Although COVID-19 has receded, governments face an uncertain future. Leaders need to be able to respond quickly when new, pressing citizen issues emerge. They also need a way to measure how their services have improved people’s lives. All of which require real-time data from multiple sources. 

Government leaders point to four key capabilities that could help them better meet constituent needs: 

1. Connecting operational, people, and financial data to business outcomes (43%).
2. Quickly changing business processes (37%).
3. Enabling fast cycles between planning, execution, and analysis (33%).
4. Running multiple planning scenarios (33%).

However, 69% say their teams are lacking in these key capabilities. And addressing this skills shortfall requires breaking a vicious cycle: To attract the talent they need to modernize their systems, government agencies must provide workforce tools that improve the employee experience.

“The federal government is certainly facing this challenge as it competes for workers in areas like Washington, D.C., where there are many commercial companies that compete for the same talent but provide modern tools to the workforce,” says Miranda.

Government leaders understand the urgency of this issue—41% listed faster acquisition and deployment of new skills and teams as a top opportunity for digital growth in the next 12 to 18 months.

Do More on a Limited Budget

While some state and city governments have made notable tech improvements, most still lack the critical capabilities required for data-driven decision-making. Only 13% of government leaders are confident in their team’s ability to model multiple scenarios, and only 1 in 5 are confident their team can provide relevant insights to the broader organization.

“Governments at all levels have sought to improve performance measurement of agency activities, outputs, and outcomes,” says Miranda. “We are finally at a point where combining finance, human resources, and operational data is within reach.”

One reason governments aren’t increasing these investments is because they feel locked into the way things have always been done.

“Cloud technologies have the promise of doing much more than legacy systems, doing it in a more secure environment, and utilizing a delivery model that can cost much less than maintaining a patchwork of fragmented, on-premise systems,” says Miranda. “But to capitalize on best business practices, governments need to embrace change, which is always difficult.”

To drive much-needed change across government agencies, leaders need to shift their focus from maintaining the status quo to engaging in ways of working. While back-office investments may not build public relations buzz, they can go a long way toward helping governments do more with the resources at hand.

“Digital investments are often invisible to constituents, certainly compared to investments in physical assets,” says Miranda. “But digital tools are drivers of efficiency, operational excellence, and citizen satisfaction with services.” 

To learn more about how Workday helps governments drive digital transformation, visit our website.