AI-driven government plan to improve productivity can't underestimate culture

New global research from the Economist and SAS explores complex nexus of government productivity, AI and culture

For government productivity to flourish, culture and technology must both be prioritised. This was a key finding in a new Economist Impact report, supported by data and AI leader SAS, that examines the opportunities and obstacles of public sector productivity reform.

The report, Reimagining the Future of Public Sector Productivity, follows shortly after the UK government’s announcement of its AI Opportunities Action Plan, where Prime Minister Sir Keir Starmer said Artificial intelligence presents a "vast potential" for rejuvenating UK public services. The report from the Economist and SAS makes it clear that ‘technology alone won’t unlock productivity in government’.

“Amid fiscal constraints and rising demands for public services to address complex challenges like aging populations, climate change and economic uncertainty, governments must act decisively to implement productivity reforms. For instance, the fiscal response to the Covid-19 pandemic in select high-income countries amounted to 21% of GDP, underscoring the critical role of government intervention in times of crisis.

“Our research finds that while digital transformation is essential, it is not enough on its own. Success depends on adaptive organisational structures that overcome resistance to change and involve employees in the design and implementation of new technologies. Artificial intelligence offers the public sector the chance to transform how it serves citizens and enhance the experience of employees,” says Jonathan Birdwell, Head of Policy & Insights at Economist Impact.

The report, which is based on a survey of more than 1,550 public sector employees in 26 countries, including the UK, found:

• The critical role of digital transformation and organisational redesign in boosting public sector productivity.
• The top AI use cases explored by governments, including predictive analytics and cybersecurity/fraud prevention.
• The importance of incremental productivity reforms and the challenges posed by budget constraints.
• The significance of partnerships with external suppliers to streamline and improve processes, increase response speed and enhance delivery.
• The need for greater engagement with public sector employees in designing and implementing productivity reforms.

Culture and technology go hand-in-hand

The report, which has been released during National Productivity week, found governments around the world are realising significant gains from investments in e-government, data-driven services and AI, but these alone are not enough to deliver change. The survey reveals that adaptive organisational design and digital transformation are the most important strategies to boost productivity in the UK public sector - both will be crucial to the success of the government’s AI Opportunities Action Plan.

“Technology alone won’t unlock productivity in government,” said Jennifer Robinson, Global Government Strategic Advisor, SAS. “But with a flexible culture that adapts to new innovations, incremental improvements in productivity over time can make a huge difference - this will be crucial to the UK government’s rollout of AI in the public sector.”

Governments are understandably cautious about risk-taking, with 70% of global survey respondents agreeing that their organisation is adopting new technologies only after they have been proven effective in other organisations - in the UK this was slightly higher at 75%. Additionally, governments have limited budgets and may lack the capacity to absorb new technologies. Data privacy concerns (60%) and a culture of risk aversion (42%) are also considered major/critical challenges to successful technology adoption in the UK public sector.

While respondents acknowledged these barriers, an overwhelming majority (91%) of global respondents see digital technologies as offering more benefits than risks to their organisation. In the UK, this figure stands at 87%.

AI takes centre stage

More than half of (52%) global respondents believe that AI will have a significant/critical impact in improving productivity within their organisation over the next three years. The report explores the most promising uses of AI in government and includes real-world case studies from agencies around the world. The survey revealed that predictive analytics was the top current use case for AI, selected by 66% of respondents. The ability to predict and plan for risks is one of the most appealing use cases of AI given its power at simulating scenarios.

Another popular AI application was cybersecurity and fraud prevention, selected by 54% of respondents. In the field of fraud, the complexity of financial crime and money laundering, and the use of AI by sophisticated criminals, is forcing fraud fighters to enhance their own use of the technology. The UK results aligned with these global findings.

Getting employees on board

Productivity reforms are doomed to fail if employees do not buy in, yet the survey shows the need for greater engagement. According to the research, public sector employees in the UK are rarely consulted on the adoption and implementation of AI - less than four per cent of respondents said employees were involved at any stage (determining the need, selecting technology type, implementing, assessing and evaluating).

Reimagining the Future of Public Sector Productivity is supported by in-depth interviews with experts from academic institutions, government bodies, non-governmental organisations and international multilateral institutions. The report presents survey findings and qualitative insights, with recommendations to help stakeholders pursue ambitious but realistic productivity reform in central and local government.  

Read the full report here and join SAS Executive Vice President Gavin Day along with Luis Felipe Montero, Brazil’s former Secretary of Digital Government and current Chief Executive at CATENO, Kelly Ommundsen, Head of Digital Inclusion for the World Economic Forum, Morten Elbæk Petersen, Director of Denmark’s National Health Portal and Jeremy Kingsley, Global Lead, Strategic Foresight, Economist Impact for an in-depth discussion of government productivity and AI in the Feb. 5 webinar, Unlocking global gains: Elevating public sector productivity through digital innovation.

New global research from the Economist and SAS explores complex nexus of government productivity, AI and culture