In the 1960s and 1970s, government was one of the few organizations with the resources to invest in the newly emerging field of IT. Advanced industrialized countries saw extensive growth in government during this time, as the public sector took on more tasks and built comprehensive tax systems to fund the public projects.
As a result, many central governments became pioneers in IT development, according to the authors of Digital Era Governance. They had their own highly skilled staffs and developed in-house expertise that was the envy of the private sector. Today the importance of IT in government continues to grow. What has changed is that "governments no longer run their own IT functions."
Increasingly the global public sector has turned over functions to systems integrators, some of which rival the size of the governments examined in this book. For example, Electronic Data Systems (EDS) supports 2.5 million desktops in the public and private sectors worldwide, employs 126,000 staff and has revenue of $33 billion. In the UK, Australia and New Zealand, government IT contracting is dominated by a handful of these integrator giants (EDS controls 80 percent of IT contracts in New Zealand!).
While other countries, including Canada, Japan and the United States, have retained a fairly strong in-house capacity to manage IT functions, the authors argue that modern government is transitioning into "adhocracies with outsourced operating cores, of which privately designed, built and run IT system are the key components."
With that in mind, Digital Era Governance examines the interaction between government, and the IT industry and the ongoing transition to digital government, where agencies "become their Web sites where the electronic form of the organization increasingly defines the fundamentals of what it is and what it does."
The book looks at the development of central government IT contracting as practiced in seven countries: the USA, Japan, the UK, Canada, Australia, the Netherlands and New Zealand, and evaluates in particular detail the impact of government IT contracting in taxation, social security and immigration.
A core point of the book is to focus on what the authors see as the historical underappreciation of IT in the public management field. They contend that the neglect of IT's central role in modern governance processes could have a negative impact on policy making, as well as service delivery. Data shows that as the giant systems integrators take on more and more of the design and implementation of IT functions in government, the performance of government IT systems declines.
The solution is for public management to reduce the number of siloed programs within government, and to embrace reintegrated services along with a holistic and "joined-up" approach to policy making. At the same time, the IT industry that serves the public sector needs to abandon expensive,