[Dave Birch] Patrick Dunleavy of the LSE gave a keynote on innovation in the delivery of public services at the LSE's SSIT 09 conference and I thought that some of his thinking about how the government responds to "web 2.0" has implications for how we in the banking and payments sector also innovate in response to this new generation of connection technlogy. He began by explaining that the web 1.0 manifesto for government in response to the arrival of the Internet was broadly
- Disaggregation, or breaking big dinosaur departments into smaller more nimble departments co-ordinated by new technology;
- Competition and finding alternative suppliers (and, I imagine, relying on competition between suppliers to bring
- Incentivisation (potentially via privatisation) so that decision-makers would take advantage of the opportunities.
In practice, this didn't deliver. Some of the reasons are specific to the world of government -- particularly the apparently ingrained attitude that "old-fashioned" means easy to use because citizens won't understand (eg) text message -- but some apply to the world of banking too, in particular
- No integration into society's networks, and
- No recognition of intermediaries (even other government departments) which makes it hard for value networks to emerge. In other words, you can't log in to the DVLA using your HMRC "identity" and such like.
The implementations never delivered what was promised. Centralisation and a variety of disastrous "big bang" schemes, a disastrous under-investment in everything you need for successful systems (eg, training, support, storage etc) and a reliance on text (in a YouTube world) has basically led down a dead end. And Patrick made a point that I have often reflected on given my own experiences with the public sector here but have been reluctant to mention in a public forum: a great many of these initiatives came from people who didn't know anything about the technology. Here, I like to think, banks have done a little. The arrival of the web may not have done as much to reduce costs as might have been hoped (because the web ended up as an additional rather than replacement channel) but it has delivered better service to customers.
Anyway, in the public sector the end result has been that e-government hasn't delivered and Prof. Dunleavy used some detailed case studies (such as the Department of Work and Pensions utterly hopeless online communications strategy, where a third of phone calls were never answered and each civil servant on average sends a "customer" e-mail once every four months, resulting in a huge increase in the number of paper interactions!) to explain why this first wave of e-enablement hasn't reduced costs or delivered new services. His summary, if I interpreted correctly, was that government does, essentially, the same as it did before despite Google Maps and mash-ups, World of Warcraft and web 2.0 in all its glory.
Where next? Can innovation with the new web 2.0 toolkit deliver a step change in e-government and is there anything that the banking sector can learn from this? Patrick summarised the new agenda as
- Reintegration. Having hundreds of different departmental web sites just hasn't worked. People want to go to a single web site and have the system take them on a journey, not have to plan it all out for themselves.
- Needs-based holism, which means designing those journeys on the basis of customer needs not existing processes (I wanted to order a new cheque book the other day and couldn't figure out how to do it, so I complained, and a couple of days later got an e-mail telling me that there was no facility for ordering cheque books online. How can a customer tell the difference between "can't find" and "doesn't exist"?).
- Revitalisation. He made a rather big claim that in a few years time, some government departments will be, in essence, their websites. I wonder if this is true for financial services providers? The first wave of web 1.0 online-only banks didn't fare especially well, but it might be different in a web 2.0 world.
What does this mean for the technology? It means rich content, real-time interaction, mix and mash-ups capabilities, massive storage and a few other things. But a key shift is that search is king. I can't Google my own Barclaycard transactions yet, but I'm sure I will be able to one day. Actually, I think this sort of new technology is beginning to enter the payment space, but in a very limited way. Right now, there's no way that I can mix and mash-up my payment data from Barclaycard, MasterCard and American Express.
Finally, I picked up a few good practice points that Patrick highlighted as he went through a few examples and I thought that these were worth repeating as they could be elements of innovative new services in the payments world.
- Strong customer segmentation, presenting different organisational views to different customers;
- Playing back information to users, constantly reassuring them that their instructions have been understood;
- Collecting customers testimonials and having the guts to put "Amazon ratings" around your core services (and actioning critcism);
- Integrating with social partners to make yourself part of a value network;
- Democratising innovation so that customers and partners can participate in service development.
Patrick's excellent presentation served to remind me that we need to look outside both to learn lessons and to find new ways to making innovation part of the process of payment service delivery. Perhaps his last point is place to start: why not look at finding ways to open up to innovation. Why can't I download software to my chip & PIN card?
Perhaps the most important use of money - It saves time.
Author W. Somerset Maugham (1943).
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