Value Investing: The Case for Technology

Editor’s Note: Starting this month, Harvard’s Stephen Goldsmith will write a regular column on data, analytics and citizen engagement.


The intersection of government and data holds great promise for transforming the way government operates. Breakthroughs occur as small-app developers and large technology companies alike produce innovative solutions to government problems. Yet the pace of these discoveries can be dizzying for a policymaker without a technical background. In these columns, over the next few months, I will suggest approaches that might help accelerate the adoption of these changes, both by focusing on successes and by creating a common language among agency head, elected official, budget director and information executive.

There is both enormous opportunity and plenty of gain to go around. On the opportunity side, creative public officials now can harness and integrate the power of wireless devices, cloud computing, data mining, analytics and social media. Engaging data in government decision-making is easier and more cost effective than ever. Data analytics allow executives to make truly informed decisions that take into account economic, environmental and societal ramifications of policy change. Of course, these benefits are not limited to the top level of government. Mobile tools and cloud storage provide front-line decision support to field workers, allowing increased discretion and better decisions in areas as diverse as street repair and child welfare.

Yet all of us who have held executive responsibilities in budget-strapped cities know well the story of the technology provider teaming with an agency head claiming that a significant expenditure will save money in the long run, only to see the expenditure, but not the savings. Every level of government, and also the private sector, has been the victim of cost overruns on large projects.

As any policymaker interested in technology can attest, leaders must make a wide range of choices within the scope of limited budgets and staff. The challenge is to strike the best balance between allocating sufficient resources to adopt these technologies within government and outsourcing to the private sector for the most cutting-edge technology. The language barrier today among important government officials suppresses the very spending that will allow breakthroughs just as it tolerates the cost overruns and unnecessary expenditures in other areas. A few years ago, Bill Eggers and I noted in Governing by Network that the new shape of government is not hierarchical and silo-bound but networked. Since then, technology has progressed so much that the power of networks can expand exponentially, but officials must engage all sectors and multiple agencies to produce public value most efficiently.

Today’s governance can combine agency breakthroughs from enterprise data mining with this digital community participation to produce public value, resulting in better services, outcomes and citizen-generated solutions. Despite the creation of very specific positions like chief data officer and chief innovation officer, cross-agency collaboration is necessary for true innovation.

Each month, I will speak in these columns to the policymaker interested in technology by highlighting the ways that public entities across the country are incorporating data and technology into their operations and producing new levels of efficiency, community engagement and public value. We will explore a broad range of technologies from data analytics to apps to social media. This column will build on our research project at the Harvard Kennedy School’s Data-Smart City Solutions initiative where you will frequently find more details on what I discuss. Please join me in charting a new course for government.