Unit4 has published the Unit4 State of the Digital Nation report. The report examines public sector technology maturity trends in several countries. It is based on a survey by Vandon Bourne of 400 public sector decision makers with knowledge of Finance, IT, HR, strategy, and corporate operations. The global report covers Canada, the Netherlands, Sweden and the UK. There are also individual reports for each country. The findings also draw on the previous two reports, delivering trend analysis as well.
Following an executive summary and introduction, the report contains a regional analysis of the public sectors of the four countries. It concludes with short sections around some insights about three different types of public sector organisations: Central Government, Local & Regional Government and Healthcare, highlighting the key trends. The final section identified four actionable recommendations for public sector organisations relating to technology. These are:
- Prioritise seamless system adoption
- Develop hybrid work strategies
- Strengthen change management practices
- Enhance data governance and analytics
The conclusion also explains why Unit4 is the ideal partner for public sector organisations, offering a specific industry approach, deep capabilities, and numerous sector references.
Overall, some trends continue to exist across the four countries: Digital transformation remains a key priority, with 98% having a strategy in place. However, it is unclear what progress is being made, as 71% are targeting completion within 2 years, the same as both the 2021 and 2023 surveys.
Other key priorities are growing in importance:
- Growing pressures for centralised services or shared services – 50% (2023: 33%)
- Greater focus on environmental sustainability – 49% (2023: 32%)
- Greater pressure to deliver efficiency savings – 49% (2023: 37%)
Barriers remain, with system complexity being the most elevated barrier, up 24% to 43%. The other top barriers are misalignment across internal departments (45%) and a lack of leadership (41%).
Trends within the UK
Talent Trends
Many of the trends found in the UK are reflected in other countries. For example, organisations are struggling to recruit because of the return to the office, post-COVID. Only 15% (2023 – 37%) are operating a fully remote model, and 49% (2023 – 93%) a hybrid model. Despite, or perhaps because of, this return to the office, 24% of leaders are struggling to recruit.
There are other challenges around recruitment and retention, with many struggling to identify talent with the right skills. The return to the office has also limited the talent pool, as remote workers are unable to apply for roles that require them to travel to the office. Retention is also an issue, with 17% saying it is hard to retain talent, up 4% from 2023. In the Netherlands, the rate has risen from 8% to 25%.
Mark Gibbison, AVP Global Public Sector and Higher Education, Unit4, said, “The people aspect of digital transformation should never be under-estimated, so Public Sector decision-makers ought to think carefully before they go too far back down the path of mandating office-based work.
“The continued support among workers for remote and hybrid working cannot be ignored. If the Public Sector wants to attract the best candidates. In that case, it must be willing to adapt or find alternative solutions, such as increasing automation and use of AI to support the existing workforce to do their jobs.”
Technology Trends
A whopping 59% of UK public institutions view their current back-office solutions as failing to deliver optimal performance. While this is the same as in 2023, it demonstrates that progress has not been made. The majority of staff feel that data access could have been easier over the last two years (67%), and access to real-time data could have been easier too (70%).
AI is making inroads in the public sector, with 31% of respondents believing they will either adopt or increase their use of AI in the next 12 months. Access to real-time data to improve reporting is a key priority, ahead of many others.
Public sector organisations want to transform, but they seem to be slow in completing the work. The focus, according to the research, is on saving costs and moving to SaaS solutions. This is inevitable, and is a demonstration of how cash-strapped public sector organisations are. Replacing systems costs money, and it seems that most can only make iterative changes in order to manage budgets.
Gibbison, added, “At a time when the UK public sector is facing huge pressure to reduce costs but still improve citizen services, it is imperative that digital transformation strategies show tangible benefits in the shortest possible time.
“This is no easy task given the complexity of existing IT systems, but there is positivity when it comes to organisations remaining committed to modernisation. Now is the time for senior leaders to provide clear guidance on strategy, because implementing more innovative, Cloud-native applications will empower employees to be more agile and scale services rapidly while driving cost efficiencies.”
Enterprise Times: What does this mean
Most public sector organisations are moving staff back into the office, even in Canada, where distances are a factor. Adoption has dropped from 89% to 66%, though it is still the highest. In the Netherlands and Sweden, there is a growing interest in shared services. Is this a direction that the UK might consider again? The challenge is that larger projects often fail.
Unit4 falls short of offering advice to the central government, but its recommendations for success might need senior buy-in from the public sector at all levels. For the UK, it recommended:
- Invest in robust, interoperable SaaS and workflow automation platforms to accelerate digital transformation and reduce legacy system dependencies
- Strengthen cross-departmental adoption of analytics and collaborative technologies through structured change management and executive sponsorship
- Amplify knowledge-sharing across government bodies to replicate successful digital pilots and innovations
The first fits firmly within the expertise of Unit4; the other two can be assisted with, but change can only come from within. Will the public sector be brave enough and allocate enough budget to move the needle over the next two years?
