The Emperor has no Clothes

Risk & Results in Increasingly Transparent Government 2.0 World www.fmi.ca Professional Development Week November 2010

There is nothing more difficult to carry out, nor more doubtful of success, nor more dangerous to handle than to initiate a new order of things.
Niccolo Machiavelli

Age of Transparency

With apologies to

Hans Christian Andersen, Brothers Grimm, Aesop, Mother Goose…

…and all the technology companies with fairy tail justification for your money.

evangelical descriptions of the Government 2.0 examples presented during the event. However, there was an under-emphasis on subjects such as process change, adaptable methodology, and cultural dynamics.
Steve Guengerich

Government 2.0 Governance in Context
Enterprise
Scope

Project
Social Focus Transactional

Government 2.0 Governance in Context
External
Scope

Internal
Social Focus Transactional

The future ain’t what it used to be
Yogi Berra

vendors brewing cost justification

Facts vs. Deduction (the “white paper”) vs. Urban Myth (the “case study”)

What “should” work vs. What “actually” works

Truthiness

introduction

Drivers for Innovative Approaches
globalization transparency

crisis

knowledge

governance

technology

introduction

Premise
• Traditional approaches to IT risk not fully effective • Less so in Government 2.0 era • Exposing:
risk adverse = high risk highly predictable = failure

• New approach to risk required

• Change in governance mechanisms

introduction

Agenda
• • • • • • • • Risk & government IT innovation Government IT risk approaches Government 2.0 adoption Transparency changes (mostly) everything? Risk 2.0 Value 2.0 Governance 2.0 Government 2.0 good practices

Most of our assumptions have outlived their uselessness.
Marshall McLuhan

risk & innovation

TLAs
• GRC – (Governance, Risk & Compliance) • ERM – (Enterprise Risk Management)

Risk is good

Risk has Reward Upside

Risk Reward
positive Reward negative low Risk high

Governments tend to be riskaverse, including in their acquisition of technology. What is not clear is if government would be innovative in its use of technology were it not for the fact that its processes at mitigating risk often also kill innovation.
2003-04-16 Gartner Managing Risk in Public-Sector Procurement

risk & innovation

What is government innovation?
• Lacks the prerequisites for innovation? – Creative thinking – Idea experimentation – Inventiveness

• Economic incubator
– “Government as Platform”

• Services modernization
– improved citizen and business services

gov IT risk

Agenda
• • • • • • • • Risk & government IT innovation Government IT risk approaches Government 2.0 adoption Transparency changes (mostly) everything? Risk 2.0 Value 2.0 Governance 2.0 Government 2.0 good practices

Risk can be more about fear than risk

gov IT risk

Approaches to IT Risk
What can go wrong? What can go right?

• The FUD Factor
– Anecdotes – Urban myths – Edge cases

• Absolute certainty
– Facts – Scientific studies – Proven elsewhere

• Risk factors
– Political – Contractual – Programmatic

• Risk factors
– Innovation

Typical Government IT Project Concerns
Policy
Will project be completed within the current Government mandate?

Operational

Political

Will project be on time?

Contractual

Will vendors complain about unfair practices?

Will the right solution / best value be acquired?

Programmatic

Did the expected outcomes occur?

Will project be on budget?
based on Gartner framework

Interpretation of Government IT Failure

Policy
Political
Proves policy ineffectiveness

Operational
Civil servants did not have competence to execute policy

Contractual

Proves policy was too expensive to have benefits

Civil servants unable to choose most effective solution

Programmatic

Proves policy was too difficult to have benefits

Civil servants were not able to manage the project on time & on budget
based on Gartner framework

Focusing so much energy on avoiding political embarrassment leaves too little energy, or interest, to mitigate the challenges of programmatic risks, thus threatening the project's success.
2003-04-16 Gartner Managing Risk in Public-Sector Procurement

Success & Upside of Government IT Risk
Policy
Political
Government is committed to effective policy.

Operational
Low cost with high benefits thanks to effective project management

Contractual

Efficient, effective, competitive and cost effective. Efficient, effective, competitive and cost effective.

Low cost with high benefits thanks to effective contract management

Programmatic

Low cost with high benefits thanks to effective project management Low cost with high benefits thanks to leveraging innovative solutions.
based on Gartner framework

Innovation

Government is world leader in innovation.

gov IT risk

The New Normal
• Same depth of analysis on what can go right, what can go wrong needed • Risk identified to mitigate • Room for experimentation with chance of failure • Risk of not doing it • Risk of rogue Web 2

gov 2.0 adoption

Agenda
• • • • • • • • Risk & government IT innovation Government IT risk approaches Government 2.0 adoption Transparency changes (mostly) everything? Risk 2.0 Value 2.0 Governance 2.0 Government 2.0 good practices

Government 2.0 Adoption: Lies, damn lies and statistics?

Forrester 2007: Value of Web 2.0 in Enterprise
Blogs

gov 2.0 adoption e 2.0

Social networking

Substantial Value
Wikis

Moderate Value Limited Value

No value
Don't Know
Podcasting

RSS

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Forrester 2010: Web 2.0 adoption in business plans
Wikis

gov 2.0 adoption e 2.0

Discussion forums

Implemented, not expanding New or expanded deployments No plans

Blogs

Social networking tools

Don't know

Idea generation tools

Microblogs 0% 20% 40% 60% 80% 100%

ZEW/Creditreform 2009: Web 2.0 In-house usage
Innovation/suggestions

gov 2.0 adoption e 2.0

Contacts management

Communication

Knowledge management

Exchanges of information
0% 10% 20% 30% 40% 50% 60% 70% 80% 90%

ZEW/Creditreform 2009: Web 2.0 External usage
Marketing

gov 2.0 adoption e 2.0

Work on joint projects

External communication

Customer and supplier relations

0%

20%

40%

60%

80%

100%

IDC 2009: Leadership Use of Web 2.0 Technologies
Virtual World Facebook Livecasti ng Twitter

gov 2.0 adoption

Government Non-Government

Wikis

YouTube

% Deploying Technology

Blogs

RSS 0 10 20 30 40 50 60

IDC 2009 : Using Web 2.0 for Information Delivery
Program Info

gov 2.0 adoption

Customer Alerts

Response to Feedback

Co-Develop Content

% Deploying Technology

Recruitment

Education

0

10

20

30

40

50

60

70

(%)

HP 2010: US Federal Government Survey on Government 2.0 Usage
Virtual worlds Syndicated web feeds Collaboration Suite Wikis

gov 2.0 adoption

Podcasting
Social Networks Government Specific Video & Muiltimedia sharing Blogs Social Networks General
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

Gartner 2009 Recommendations
Benefit Less than 2 Years 5 to 10 Years More than 10 Years

2 to 5 Years
• Cloud Computing

Transformational • Web 2.0

High

• Green IT • Social Software Suites • Corporate Blogging • Micro-blogging • Wikis

• Shared Services

Moderate

Low
From Gartner: Emerging Technologies & Government Transformation Hype Cycles

Benefits from IT-Enabled Connected Government
Internal
To Provider Agencies and Governments

External
To Consumer Citizens and Businesses

1. Avoidance of duplication 2. Reduction in transaction costs 3. Simplified bureaucratic procedures 4. Greater efficiencies 5. Richer communications & coordination 6. Enhanced transparency 7. Greater information sharing 8. Secure information management

1. Faster service delivery 2. Greater efficacy 3. Increased flexibility of service use 4. Innovation in service delivery 5. Greater participation and inclusion 6. Greater citizen empowerment 7. Greater openness and transparency
Source: Dr. Pallab Saha

transparency

Agenda
• • • • • • • • Risk & government IT innovation Government IT risk approaches Government 2.0 adoption Transparency changes (mostly) everything? Risk 2.0 Value 2.0 Governance 2.0 Government 2.0 good practices

Unintended transparency might not be every public sector manager’s dream.
Tommy Dejbjerg Pedersen

Transparency means you can’t put your reputation back together again

value 2.0

Citizens are Watching You

transparency

Reputational Risks
• Beyond your network • No control over your “message” • Not engaging social networks – huge reputational risk

transparency

Unintended Consequences
mandate

outcome outturn input output

budget

transparency

Unintended consequences
Measured Outcomes

Outcomes not measured

• False positive: – Measurements show success, but impact is negative • False negative: – Measurements show failure, but impact is positive • Why? – No objective measurement like profit

transparency

Unintended Consequences
mandate

outcome outturn input output

budget

transparency

Web 2 Era
• • • • • • • Pull business models Open source software Customer self-service The Long Tail Social Media Customer community management Decentralized product development

Web 1 Era
• • • • • • •

Push business models Commercial software Customer service Bestseller products Traditional media 1 to 1 Customer relationships Centralized product development

unpredictability variety volume
Source: Dion Hinchcliffe ZDNet

central production
institutions

peer production

shift of control

communities of individuals

Digital Age Democracy
A New Era of Digital Governance Industrial Era Democracy Citizens Politics Representative Passive Consumers Digital Era Participatory Active Partners One-to-One

Broadcast, Mass, Polarized
National, Monocultural

States
Source: Mills Davis, Microsoft

Global, Local, Virtual, Multicultural

risk 2.0

Agenda
• • • • • • • • Risk & government IT innovation Government IT risk approaches Government 2.0 adoption Transparency changes (mostly) everything? Risk 2.0 Value 2.0 Governance 2.0 Government 2.0 good practices

I’m the “NO” guy in your organization and most likely the person to bring your enterprise 2.0 or web 2.0 project to a grinding halt. People in my position do not want to hear about being social. I don’t care what you had for lunch or what your kids did last night. I don’t want to endanger the multi-million dollar value of this company so that you can play with Facebook inside the office. Now get out of my office before I sic my flying monkeys on you.
Doug Cornelius, Compliance Building blog

risk 2.0

IDC 2009 : Top Challenges Your Organization Faces in Deploying Web 2.0
Security

HR Constraints
Government

Non-Government

Technical Expertise

Budget
0 10 20 30 40 (%) 50 60 70 80 90

risk 2.0

HP 2009: Main Barrier to Government 2.0 Adoption, US Federal Government

9% 8% 40%

Security Concerns Lack of Budget Technical expertise/ability Uncertainty regarding what resources are available Lack of compelling need or reason None

9%

14%

21%

Deloitte 2009: Move to more collaborative model of government requires re-organizing traditional work structures
Strongly disagree

risk 2.0

Disagree

Neutral

Agree

Strongly agree

0%

10%

20%

30%

40%

50%

60%

Deloitte 2009: Biggest barrier to effective Web 2.0 implementation
2% 18% 31%

risk 2.0

5%

25%

18%

Culture of hierarchy doesn't fit flattening of organization Potential loss of control over messaging Limited awareness of Web 2.0 technologies Concerns that Web 2.0 initiatives may increase workload Concerns that privacy and security can't be managed sufficiently Don't know

Deloitte 2009: Mitigating the downsides of a flattened organization, such as the potential disenfranchisement of middle management, presents a:
No challenge

risk 2.0

Little challenge

Moderate challenge

Significant challenge

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

50%

risk 2.0

Deloitte 2009: Managing the generational divide in an organization introducing collaborative technologies into the work environment presents a

No challenge

Little challenge

Moderate challenge

Significant challenge

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

50%

risk 2.0

Deloitte 2009: Developing a compelling case for Web 2.0 presents a:
No challenge

Little challenge

Moderate challenge

Significant challenge

0%

10%

20%

30%

40%

50%

60%

70%

Fear around the security of data is a real issue and the risk can never be entirely eliminated
Jessica Hawkins, Ovum

Models of Government Data
Publish Purpose You know how data will be used Documents Vetted, edited, approved Social Media You do not know how data will be used Machine readable Community Vetted

Container Quality

Deployed

Slow

Rapid

Web 2.0 does uncomfortable things: it releases assets into the wild, it empowers users to speak their mind, it asks people to share and collaborate in a way which has been unprecedented in the past.
Mike Ellis-Science Museum UK, Brian Kelly-University of Bath

risk 2.0

Constraints
1. 2. 3. 4. 5. Legacy systems Organizational risk aversion Personal risk aversion Policy limitations Internal view of the “public” & expertise

Sources: Alexandra Samuel. Ariel Waldman

Government 2 Risk and Perceived Risk

risk 2.0

Risk Perceived Risk

value 2.0

Agenda
• • • • • • • • Risk & government IT innovation Government IT risk approaches Government 2.0 adoption Transparency changes (mostly) everything? Risk 2.0 Value 2.0 Governance 2.0 Government 2.0 good practices

value 2.0

Government 2.0 Value Proposition
• Public Value – Better/fairer decisions • Increased Capacity – Solving “wicked” problems • Support – Increased legitimacy of public decisions • Government Value Add
Source: Yasmin Fodil, Anna York

value 2.0

HP 2010: Top Benefit to Adopt Government 2.0 in US Federal Government

5%

3%

Improved services to the public
18% 33%

Citizen participation in government Collaboration between agencies Government transparency Innovation by government

20% 20%

Government 2.0 offers no benefits

value 2.0

Deloitte 2009: Where will Web 2.0 have greatest impact for government?

9%

9%

Enhance resources for resource management
Improve collaborative policy development
32%

23%

Remove layers between line workers and leadership Enhance innovation Facilitate access to information requests

28%

value 2.0

Will it Be Used?
500000 450000

Source: Government of Australia
400000 350000 300000 250000 200000 150000

Paid subscription Documents published Open data

100000
50000 0

value 2.0

Deloitte 2009: Collaborative technologies
• Biggest impact • Hardest to implement

Generate policy ideas
10% 26% 13%

Refine and prioritize the best ideas Apply networked approaches to societal challenges Feedback/evaluation Change daily operations

5%

14%

8%

11% 18% 23%

44%

25%

Information sharing & more effective use of government information

3%

value 2.0

Out of Network

Source: INgage Networks

Government 2.0 Footprint
social
Government 2.0

structural

“back office”

e-government

internal Focus

external

value 2.0

Out of Network vs.

In Network

Source: INgage Networks

value 2.0

Network Effect
Number of Nodes 8
node

Source: http://web2.wsj/com

Potential Maximum Value (by power law)

network
Metcalfe’s Law – 60 Odlyzko & Tilly Law – 16.6 Reed’s Law -257

Deloitte 2009: User-driven citizen feedback will have the greatest impact on

13% 30%

Programs/services are developed Programs/services are delivered Policy is developed

5%
52%

Policy is refined

ROI is a delectable option that has unexpected risk

value 2.0

Return on Investment Model

Cost Revenue Return

Year 1

Year 2

Year 3

Year 4

Year 5

It is the framework which changes with each new technology and not just the picture within the frame.
Marshall McLuhan

value 2.0

ROI – Traditional Model for Value
• Poor analytical framework for social media • Deals with internal revenue and costs

• Silo – only the value of the data set in
isolation • Network?
node

value 2.0

Economic Value Add - EVA
• Incremental cost to make data open and machine readable • Value to private sector • In aggregate
node

network

governance 2.0

Agenda
• • • • • • • • Risk & government IT innovation Government IT risk approaches Government 2.0 adoption Transparency changes (mostly) everything? Risk 2.0 Value 2.0 Governance 2.0 Government 2.0 good practices

55% of IT mgrs believe #ITGovernance is effective, but just 40% of business unit mgrs do
Cutter Consortium Tweet

governance 2.0

Deloitte 2009: Governance solutions that will have greatest impact on government
Develop implementation toolkit
18%

16%

Present Web 2.0 at CXO councils Presidential directive
14%

21%

Reverse mentoring Create e-people/e-democracy organization

14% 17%

Desination of collaboration champion for cross-boundry collaboration

Deloitte 2009: Business case solutions that will have the most transformational impact on government

governance 2.0

17%

Develop government-wide business case
34%

Reduce costs of travel Focus groups

28%

Redefine business case to focus on effectiveness
13% 8%

Reduce costs through duplication

In the IDC survey, only 18% of government responders indicate their agency measures the success of Web 2.0 technology in meeting mission objectives, 14% for industry
Adelaide O’Brien IDC 2009

Architectural Maturity Stages & IT Value
Business Silos Standardized Technology Optimized Core Business Modularity

Strategic Business Value

Source: Jeanne W. Ross

Local Flexibility

Locally Optimized Business Solutions

Enterprise-Wide Technology Standards

Standard Enterprise Processes, Data

Standard Interfaces & Business

Risk of Failure = More Rapidly Finding Solution

You can’t manage IT the same way you’ve always managed it and empower flexibility.
James Staten, Forrester Research

Web 2.0 vs. Traditional Viewpoint
Chaos
1. People will use the tools anyway 2. Internal and external social networking 3. Free expression of ideas 4. Individualization of information context 5. Expertise vs. opinion 6. Non standard tools 7. Burden on infrastructure 8. Secure information management

Control
1. Not on work time 2. Company confidential information 3. Privacy concerns 4. Regulatory compliance & ediscovery 5. Control over content & opinion 6. Process to codify knowledge 7. Return on investment?
Source: Nick Semple

Governance processes are often overweight, take too long to develop and suffer from slow implementation.
Dr. R. Cherinka, Dr. R. Miller, J. Prezzama and C. Smith, Mitre Corporation

governance 2.0

Change and Governance

What never works What no longer works What worked

1.0

2.0

Simplified & Effective Risk Management in 2.0 World

governance 2.0

Source: Victoria Government

How do we let the Government 2.0 genie out of the bottle?

Comparing Conventional and Systems Thinking
Conventional (Open-Loop) Thinking Static thinking Focusing on particular events Systems-as-effect Viewing behaviour generated by a system as driven by external forces. Fragmented Believing that really knowing something means focusing on the details Factors thinking Listing factors that influence or correlate with some results. Straight-line thinking Viewing causality as running in one direction, ignoring the independence and interaction between and among

Source: Dr. Pallab Saha

Systems (Closed-Loop) Thinking Dynamic thinking Framing a problem in terms a pattern of behaviour over time System-as-cause Placing responsibility for a behaviour on internal factors and actors. Holistic Believing that to know something requires understanding the context of relationships. Operational thinking Concentrating on causality and understanding how a behaviour is generated. Loop thinking Viewing causality as an ongoing process, with effect feeding back to influence the causes and the causes

High Level Relationship of Government Enterprise Architecture (EA) and EGovernment Maturity
Government EA Maturity Stages
E-Government Maturity Stages
Business Silos Standardized Technology Rationalized Data & Applications

Source: Dr. Pallab Saha

Business Modularity

1. Web Presence

2. Interaction

3. Transaction



4. Transformation





Framework for Government Use of Web 2.0
Internally focused (employee and other agencies) vs. externally focused (citizens & business)

Service • Focused

Mashups of service and content through intermediaries, web service • Citizen/business engagement to enhance trust and loyalty • Service provision at citizens’ location • Virtual world experimentation

Interaction Focused

Employee & constituent feedback on info, service, forums • Tagging and social bookmarketing of gov’t content • Wikis to support interaction, citizen engagement • Social network sites and blogs • Virtual world interactions

Communications Focused

Institutional vs external oriented blogs • Enterprise social networks • Podcasts & vlogs • Wikis • RSS
Source: Ai-Mei Chang, P.K. Kannan

Government 2.0 Risk Register
Low Medium • Human Resource capabilities • Technical capabilities • Information Quality* • Costs (new data) • Mandate & Mission • Legal Liability • Intellectual Property High

• Information Quality* • Costs (existing data)

• Security • Privacy

Source: Linda Cureton, Brian Drake, Dr. Mark Drapeau, Steve Radick, Michael J. Russell

Government IT Governance Structures
Bottom-Up Mandate, Governance & Control Top-Down Mandate & Bottom-Up Governance & Control Top-Down Mandate & Control, BottomUp Governance Top-Down Mandate, Control, Governance

• Projects • Government 2.0 i.e. Collaboration

• Shared services • Government 2.0 i.e. Wiki

• Budget process • Government 2.0 i.e. Ideation

• Access to Information • E-Government i.e. transactions

Software Governance Structures
Bottom-Up Mandate, Governance & Control Top-Down Mandate & Bottom-Up Governance & Control Top-Down Mandate & Control, Bottom-Up Governance Central Control

• Real identity

• Wiki

• Moderated discussion, forum, blog

• Document management & traditional collaborative tools

Government 2.0 Risk Factors
Internal Silo

Project Focus

Internal Cross Agency Programmatic Support

Across Government Tiers
Mission

External to expert community
Policy Support

External open Policy Development Big Bang

Activity Support Modest Size Broadcast

Broadcast+ Interaction Focused Roll-out Leadership ownership

Interactive Service Focused

Communication Focused Experimental Early Stage

Business function ownership Managed user identity Peer governance Rationalized data and applications Commercial internally hosted

IT ownership

Moderated
Standardized technologies Open Source internally hosted & adapted Commercial internally hosted & adapted

Open
Silos, No Standards External Social Network Custom Developed

Technology Footprint

Enterprise Architecture

Open Source internally hosted

Low

Moderate

Medium

MediumHigh

High

Government 2.0 Governance Matrix

High Medium Low Risk Register

good practices

Agenda
• • • • • • • • Risk & government IT innovation Government IT risk approaches Government 2.0 adoption Transparency changes (mostly) everything? Risk 2.0 Value 2.0 Governance 2.0 Government 2.0 good practices

As technology advances, it reverses the characteristics of every situation again and again. The age of automation is going to be the age of “do it yourself.”
Marshall McLuhan

good practices

McKinsey 2009: Measures to Successfully implement Web 2.0 Tools
Providing formal incentives

Allowing nonwork uses

Providing informal incentives

Senior leaders role modeling/championing use of technology

Integrating into employees' day-to-day work activites

0%

10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

Internet Evolution to 2020
3.0 The Semantic Web:
Connects Knowledge

4.0 The Ubiquitous Web:
Connects Knowledge

Increasing knowledge connectivity

1.0 The Web:
Connects Information

2.0 The Social Web:
Connects People

Increasing social connectivity

Source: Mills Davis

Government 2.0 Sequence Good Practices
External
Scope 5. Governance Level 2 4. Iterate 3. Focus on small wins 2. Small internal low cost projects with chance of failure Departmental Focus 1. Follow before Lead Transformational

Internal

Value of Small Projects

Government 2.0 Governance
Experimentation Stage
Build Capacity Develop Gov 2 Mission Design for Outcomes Follow before Lead Strawman mission Strawman metrics

Operational Stage
Build tech & social capacity Develop engagement goals Align to mission

Create an Implementation Strategy
Gov 2 Policies

Tools follow goals
Code of Conduct Identify enthusiasts, champions

Tools follow goals
Code of Conduct

Identify Stakeholders
Develop Governance Strategy Value Motivation Extend/Consult IT standards Iterate Project specifications Focus

Cross-functional teams Program management
Economic value add

Small projects

Consider draft changes

IT Governance Develop feedback mechanisms Clearly defined

Internal

Internal & External

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