The growing importance of digital in government – are you ready for the challenge? Yvonne Gallagher | Information and Digital Team | July 2013

1. Digital governance | 1
The growing importance of
digital in government
– are you ready for the
challenge?
Yvonne Gallagher | Information and Digital Team | July 2013

2. Digital governance | 2
Our role
The National Audit Office (NAO) scrutinises
public spending for Parliament
We help to hold government departments and
the bodies we audit to account for how they use
public money
Our work helps public service managers to
improve performance and service delivery,
nationally and locally

3. Digital governance | 3
Background
• Government published its digital strategy in November 2012
• It established 11 principles for departments to conform to as
they transform their services to digital by default
• The main objective is to provide user-focused, cost effective
and maintainable digital services that enable central
government to maintain quality of public services whilst
reducing their cost and reducing manpower
• The move to digital channels is a fundamental shift for
many departments

4. Digital governance | 4
Source: McKinsey
Definition of Digital Enterprise

5. Digital governance | 5
Source: McKinsey
The next 10 industries set to ‘go digital’

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Companies are focusing on digital at the highest levels focusing on
how to :
• Increase pace and frequency of key decision making, setting specific
digital targets, use of agile
• Reshape business portfolios, re-evaluating business and assets in digital
context
• Investment at scale – alignment of investment quantum and focus to
value, build of platforms not point solutions
• Upgrade digital capabilities across the entire value chain to deliver
seamless experience that customers now expect, transform processes
end-to-end
• Nurture digital talent; establish digital leader; infuse fresh talent and
mindset; protect scarce skills set (IT architects)
• Address Cyber threats growing within the digital landscape
Digital trends occurring outside of Whitehall

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Government is starting the journey, but there are other challenges:
• Budget pressures and investment constraints
• Civil Service reform
• An extensive legacy ICT installed base
• A vast range of services and customers
• Cultural challenges
• An increasing cyber risk
• Government making changes to the way it manages ICT:
• Strategies published in the core areas of ICT including digital
strategy; use of SMEs and agile developments prioritised; quicker
more centralised procurement; stronger central governance
Government’s changes in line with
changes in wider context

8. Digital governance | 8
Operational
performance
Resourcing and
Investment
commitment
Expectations of
Digital Services
Governance, acco
untability, ownershi
p
Change
management
Risk management
Business structure
Culture
Digital
Services
Key business factors identified as having potential
impact on the effectiveness of digital services

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Using an agile approach for digital transformation
Four principles of governance for Agile delivery
National Audit Office, Governance for Agile delivery, July 2012
Assessors
have high-end
delivery
experience
Observation is main
method of evidence
collection
External assessment
focus on teams’
behaviours not just
processes and
documentation
Light touch and
proactive
Focused on
activity
underway
and value of
products &
services
Mirror the Agile
philosophy – only do
it if it brings value
and does not
introduce delays
Senior
managers
agree quality
of service
upfront
User involvement in
assuring value
Everyone is a
collaborator in
delivering quality
Fail fast learn quickly
Improve
certainty
team have on
quality they
will produce
Delivery teams select
empirical
performance metrics
and self monitor

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• Digital transformation has huge implications for value-for-
money in delivering public services; it will be a feature of
what we have to assure for many years
• Assessing the progress from a governance perspective is
an important first step
• To maintain the wider perspective in the cyber, digital and
ICT arena, it is important that we have good knowledge and
understanding of what is happening in this area in
departments
• It reinforces our commitment to help government with the
digital agenda and putting users first
Why should the NAO look at digital governance?

11. Digital governance | 11
• We have reviewed leading industry frameworks and brought
together current thinking to develop an analytical framework
• We have updated it to include digital features and highlight
cyber risk
• With clearer paths to evidence to look for regarding emerging
digital thinking and action
How we will do it: our analytical framework
Organisation
analysis
Financial and
performance
analysis
Enterprise
analysis

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To fully identify and describe the
components of the organisation
under examination and define the
scope of the study
Organisation
analysis
To fully identify and describe key
organisation financial and
performance information
Financial and
performance
analysis
To assess the ability of the
organisation to plan, implement
and manage digital services
Enterprise
analysis
Our framework approach
Current Planned Evidence
1. Vision and Strategy 5 3 H
Current Planned Evidence
2. Governance and Architectures 4 2 M
Current Planned Evidence
3. Change and Implementation 3 1 L
Current Planned Evidence
4. Service and Performance Management 2 2 H
Current Planned Evidence
5. People 1 3 M
Current Planned Evidence
6. Process 2 4 L
Current Planned Evidence
7. Technology 3 5 H

13. Digital governance | 13
Benefits of the framework approach
• It aids engagement, many departments already adopt this perspective
• Helps develop an understanding of organisation perspective
• Provides a framework for consistent and comprehensive analysis
• Supports repeatable and cross government comparison
• Enables a deeper operational view of how services are delivered
• Allows an assessment against good practice
Organisation
analysis
Financial and
performance
analysis
Enterprise
analysis

14. Digital governance | 14
We reviewed five major
Central Government
Shared
Services, representing
c.50% of central
government.
We highlighted
challenges, and analysed
how they have been
commissioned, and how
well government performed
as a customer.
Source: NAO report ‘Efficiency and reform in government corporate functions
through shared service centres’ 7 March 2012, http://www.nao.org.uk/shared-services-2012
An example of cross-government comparison:
Efficiency and reform in government corporate functions
through shared service centres

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Our studies this year will include…
• Reviews of how well departments are positioned to increase the delivery
of their services digitally in accordance with the government digital
strategy, by examining their digital governance
• Consideration of governance, the over-arching management arrangement
to support the move to digital services
• Reviews of business, ICT and cyber activity, looking at departments’
ability to embrace the digital agenda on a ‘whole business’ basis
• Examination of departments’ ability to bring the digital strategy and other
strategies together in a cohesive way
• A review of the digital exemplars

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And we will deliver a range of outputs in 2013-14
• A series of presentations outlining the organisational
landscape of selected departments
• Detailed organisational analysis
• Assessment of capability of organisation to govern digital
services and transformation enabling cross government
comparative analysis
• Highlights of Gaps / Risks / Issues

17. Digital governance | 17
How to find out more
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• NAO Annual Report & Accounts 2012-13
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