Local authorities need to prioritise the development of strategies that will help them drive maximum value from their IT investments and improve their business processes.
This is the opinion of Gert Cronje, regional chief executive of Business Connexion`s Eastern Cape Region and group executive responsible for the company`s public sector activities.
"Local government institutions, strapped for human and financial resources, need to think about innovative ways of accessing skills and capacity, improving business processes and financing the roll-out and maintenance of IT infrastructure," he says.
"For the past 10 years, municipalities and metros have focused on boosting revenue collection, forging better relationships with ratepayers and improving service delivery. IT can be an important enabler for each of these goals.
"However, many of the challenges that local government faces relate not only to technology, but also to organisational culture, business processes and a lack of continuity because of staff turnover. As such, local authorities should take a holistic view of their challenges and seek partners who can help them with business processes, technology and business skills."
Cronje says business process outsourcing (BPO) could be a valuable tactic for many local authorities. BPO involves outsourcing critical business functions to external service providers, who oversee the human and technical resources needed to deliver on the business processes.
Examples of business processes that local governments might be able to outsource effectively include debt and revenue collection and contact centres.
Cronje says larger authorities could benefit from extending outsourcing contacts into full-blown private-public partnerships (PPPs). A PPP is a long-term contract between a government institution and a private sector company where the latter performs an institutional function that once was the sole responsibility of the government.
PPPs differ from traditional outsourcing in that they involve the transfer of a significant portion of the financial, technical and operational risk of a project or service to the private sector. The private sector partner usually provides upfront funding for a project, and designs, builds and runs the service. As such, PPPs provide an efficient way for local government to access private sector skills, technology and managerial abilities.
Cronje notes that small authorities usually do not have the funds to put together complex PPPs of their own. However, they could still selectively outsource IT infrastructure or business processes, or pool resources with other municipalities in their districts.
"A so-called shared service centre could allow several small municipalities in a district to pool their resources and implement IT systems and world-class business processes that they could not afford individually," says Cronje. "This would help them to improve services to ratepayers and boost efficiency while enjoying considerable economies of scale."
Vendors also need to play their part by changing their emphasis from selling software packages towards really understanding local government`s processes and challenges, and then presenting them with appropriate solutions, says Cronje. The solutions might not always involve ripping out and replacing existing IT systems, but could instead look at integrating legacy systems or overhauling the business processes.
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