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May 11, 2023

Digital solutions hold the key for government departments under pressure to drive greater efficiencies 

Government departments are more willing and able to change than they are given credit for, but, at a time of significant economic and workload pressure, must embrace cloud-enabled HR and finance tools in order to boost productivity and deliver true value for taxpayers’ money.

From courts to health and social care, many of the UK’s public services are suffering significant backlogs. Amid budgetary constraints, double-digit inflation, pay disputes and with the ONS reporting a significant decline in public sector productivity compared with pre-Covid levels, it will be a huge challenge to clear that workload, drive greater outputs, and chart a sustainable future for the public sector that can deliver real value to the taxpayer.

cloud HR
Cloud-enabled solutions are key for governments to function in the digital age.

At the front end, the UK government is considered a global leader in delivering online services to its citizenry, but change has been slower internally. In many departments, back-office systems have become unable to efficiently deal with their workload, which has caused the wheels of government bureaucracy to turn too slowly. In November 2022, the government announced a review of the efficiency of departmental spending, building on the 5% efficiency challenge baked into the 2021 Spending Review.  

Indeed, the Autumn Statement confirmed that while total departmental spending will grow in real terms at 3.7% a year on average over the current Spending Review period, departments will need to identify savings to manage pressures from higher inflation.

“There was additional priority given to areas like health, social care and education, but despite that, we have a situation where economic growth is low and inflation high, which has eroded the value of the settlement that departments got,” says James Johns, head of corporate affairs at Workday, which is helping government departments to modernise.

“That has added financial pressure to the operational pressures that different public bodies were under as they work through the backlog from the pandemic,” he adds. “Alongside this, there is a constant need for the government to modernise and update, and an expectation among people who work inside government that the technology that they use to do their jobs is as good as the technology that they use in their private lives.”

How government departments can get ahead in the cloud

From a technological standpoint, Johns sees no reason why the government can’t leverage systems that provide the instant, web-based, self-service functionality to which private consumers are accustomed for its internal processes and external service delivery.

There are, however, clear pain points and capability gaps. Johns believes that there is a perfect storm of factors affecting the kinds of service Workday focuses on – particularly human capital management (HCM), financial management and planning – so the implementation of new cloud-based systems will be a big part of the solution.

“There are many interrelated challenges, so anything that the government can do to reduce the cost of its operations in a way that releases money away from back-office functions has got to be valuable,” he remarks. “Implementing a modern set of tools deployed on the cloud using the software as a service (SaaS) model will save government organisations money and free up resources for front-line services and for more strategic projects.”

The type of solutions Johns refers to allow government departments to better manage resources and use data more effectively – with the help of machine learning (ML) and artificial intelligence (AI) – in support of decision-making processes. 

“Take, for example, Workday Skills Cloud, which is an ML-based system for categorising skills and the relationships between them, and which helps organisations get a much better grip on the capabilities that exist in their workforce than they would ever be able to glean just from a simple count of job titles or resumes,” he explains.

Cloud-based technology enables more detailed analysis of a much bigger pool of information, and helps organisations implement contemporary HR techniques, such as the use of “talent marketplaces”.  These can help to match individual skills, aspirations and interests with business requirements to help build more effective teams.

“The cloud is an enabler of the kind of contemporary HCM techniques that allow people to get more bang for their buck out of their workforce,” says Johns. “You not only get more out of the resources you’ve already got, but can also create a more engaging environment for your staff. Within government, this can create a more attractive working environment by allowing people to develop their careers and gain the skills that they need to progress.”

Fact over fiction

The benefits of modern, cloud-based systems are numerous. Better access to and improved use of data, along with more powerful analytic capabilities, makes it simpler for individual managers to make decisions, as they don’t have to wait for paper-based reports before implementing change. They can quickly get a clear idea of how resources are currently being used.

Crucially, these benefits are not simply theoretical, they are also already manifesting at the heart of the UK government. Workday is assisting numerous government departments and agencies – including the Crown Commercial Service (CCS), Ordnance Survey (OS) and Innovate UK – to deliver real transformation.

The CCS, the procurement arm of the Cabinet Office, moved its finance function into an entirely paperless operation, eliminating the need to rekey information or move it from one system to another. Previously, it was using separate finance and HR systems that were outdated, inefficient, limited in scope and difficult to maintain, and teams at CCS were spending up to three days a month simply reconciling data between these systems.

At Innovate UK, using Workday has reduced bureaucracy and has delivered clearer processes for ensuring that every single decision adds value. From an environment of disparate systems and paper-based grants, it has created an infrastructure where data can be trusted and delivers more value.

“Using Workday for HCM, finance and then payroll to bridge those two functions means that cost centre managers have a clear idea of what their up-to-date spend is,” says Doug Ward, Innovate UK’s deputy director of business systems and insight. “That improves the speed and security of how Innovate UK operates.”

In 2017, OS, the UK’s national mapping service and a world-leading centre of geospatial expertise, decided to change some back-office systems. HR policies, systems and processes didn’t reflect the more commercial focus it had adopted, so it focused on six different systems – among them learning, expenses and time-tracking – that did not communicate with each other and provided poor user experience.

“Today, Workday is the trusted source of people data at OS,” says Shaun Ratcliffe, HR service delivery lead at OS. “From an OS perspective, that is very significant. Four years ago, there were hundreds of sources. Now, having a single source covering all employees and contractors at the organisation means all decisions have a strong foundation on verifiable data.”

A time for action

There is clearly huge potential for cloud-based solutions to transform how government operates and address the collapse of productivity during Covid.

“If you want to drive productivity in the right direction, then you need to do more with the resources you’ve got,” says Johns. “Anything that frees up people from administrative tasks, anything that reduces the cost of back-office functions, freeing up resources to be used elsewhere, is going to help improve productivity.

“Fortunately, governments are always embracing change,” he adds. “I’d argue that one of the core capabilities of most governmental organisations is their ability to adapt to economic and social pressures. So far, governments have been faster to move to the cloud for citizen-facing services than they have for their internal functions. Now, it is time for a generational shift to more flexible cloud-based systems in the back office too.”

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