Insights shared from government leaders and SAP on smart spending
Governments in Australia have always taken pride in furthering a strong service culture. Whether it’s healthcare, social services, or public infrastructure, Australians expect seamless interactions with government agencies. However, as digital technologies rapidly evolve, the public sector must keep pace to meet rising expectations—both at the front- and back-end.
For the Australian Public Service (APS), this digital transformation must be done within tight budgets, strict procurement processes, and government priorities. While citizens expect government services to match the convenience of banking or retail, IT projects face intense scrutiny to ensure value, security, and compliance.
The challenge is clear: How can agencies modernise digital services while staying within financial and policy constraints?
Doing more with less
The first method that many agencies have employed is to deliver new services from the cloud.
This alleviates the need for the upfront capital investments required when building on-premises solutions and shifts purchasing to a pay-as-you-go model that can deliver a greater lifetime value return.
The cloud model has an additional benefit since it provides agencies with immediate access to the latest technical enhancements from cloud providers.
This includes the many AI-based capabilities that are now a core offering of cloud-based services, delivering new capabilities to analyse data and automate processes. These developments improve decision-making and streamline service delivery, freeing workers from mundane tasks to focus on more rewarding activities.
Importantly, AI-based services are fast to deploy and can, in some instances (such as AI-assisted code development), accelerate service creation without raising costs.
AI is already delivering important new capabilities such as enhanced fraud detection, where AI quickly identifies patterns and anomalies in large data sets.
AI is also automating the onboarding of new staff, ensuring they enjoy a smooth arrival process and can quickly become productive contributors. We are also seeing agencies experiment with generative AI, which provides a conversational interface into complex systems in finance, procurement, Information and Communications Technology (ICT), HR, and other business units. AI can automate routine tasks in finance, procurement, and other processes, freeing employees to focus on higher-value activities using automated data entry, predictive analytics, and AI-driven bots for common tasks.
Fighting complexity for long-term benefits
The ability to generate value can be further enhanced through the adoption of agile development methodologies which emphasise shorter project development cycles to accelerate the time to outcome.
Breaking large digital transformation goals into modular parts means they can be delivered incrementally, reducing the risk in their delivery.
This combination of the cloud, AI, and agile methodologies is proving critical for helping government agencies around the world meet mandates to do more with less, by enabling them to implement cost-effective, modular projects in preference to traditional large-scale system replacements.
But there is another way that public sector agencies are solving the challenge of improving services without raising costs; by taking a standardised approach to service design. This is often described as taking a ‘clean core’ approach to service design using a foundation of standardised best practice processes, with agency-specific customisations moved out to the edge.
This approach is not only faster to implement, but ensures upgrades and extensions are easier to implement as future designers do not need to untangle the customisations of the past.
Keeping the way clear for future optimisation is more important now than ever thanks to the rapid advances in process design and delivery that are being enabled by advances in AI.
A more efficient future state
When these new capabilities and developments come together, they unlock incredible potential for agencies to quickly modernise services while reducing costs and risk, and even smaller agencies can gain rapid returns on investment.
Furthermore, by creating development programs that focus on standardisation and iterative processes, agencies gain the potential to share learnings that can further accelerate outcomes and come together in collaborative projects that reduce process duplication. They prioritise those activities that will have the most impact – a critical factor in periods of constrained spending – as returns are delivered much faster than with traditional methods.
Reducing customisations and implementing shorter-term development cycles creates more opportunities to share insights and avoid duplication. When done correctly, automation not only ensures that data readily moves across an agency’s environments but also relieves staff from performing time-consuming activities. This is especially critical for larger departments, where many requirements might be duplicated across smaller agencies.
While each of these new developments holds significant potential for accelerating outcomes and reducing costs, agencies still need to create compelling business cases to support them.
Therefore, it is critical that government planners and architects embrace these concepts as quickly as possible and weave them into the fabric of the business case.
Over time, this focus on iterative development and rapid returns on investment can lead to the creation of dynamic business cases where services development programs match evolving goals and with increased likelihood of successful delivery.
Modernisation as protection
While the benefits of modernisation to citizens and agencies alike are compelling, there is an additional benefit that can be gained, which in some instances may be the most critical of all.
Agencies today face an unprecedented level of cyber threats, which are delivered using attack methods that were barely conceived of when many of their current systems were implemented.
Despite cyber teams’ best efforts, rapid evolution in the threat landscape has created a scenario where constant patching and monitoring is needed to ensure that aging systems are protected from modern attacks, creating a costly, high-risk security scenario.
Modernisation can not only ensure services are elevated to the best standards, but also makes them easier to defend from attack through the adoption of automated patch management, which is a core aspect of cloud offerings.
Modernisation can also ensure that new services comply with regulatory requirements – a factor that can be further enhanced using Sovereign Cloud environments that are specifically tailored to local regulations and can be readily updated as those requirements are adjusted.
All these developments allow agency leaders to meet their obligation to continuously improve citizen services within an environment of budget constraint.
And by delivering smaller projects that provide a rapid return on investment, they not only reduce ongoing expenditure in the long term, but also reduce the risk and cost to ensure that services are secure in the short term.
