“Measuring ROI and explaining the business value of a tech investment is pretty difficult,” says King County, Wash., CIO Tanya Hannah. “Nobody really cares that your help desk met 99 percent for speed-of-answer. And they certainly don’t understand that all of your cyber investments are protecting you from ransomware.”
Hannah’s comments come from a comprehensive new guide on funding IT. Produced by the Center for Digital Government in partnership with the Center for Municipal Finance at the University of Chicago’s Harris School of Public Policy, the guide, “Funding Gov Tech: A Practical Guide to Financing State and Local Government IT,” offers a roadmap for investing wisely in the tools and technologies that will power the public sector for the years ahead.
The publication includes best practices for addressing technical debt; structuring and managing technology expenditures; sharing services; partnering with the private sector; and optimizing new spending to make the most of this historic moment.
As Hannah points out, one of the most important aspects of gov tech funding is communicating needs, value and ROI. Organizations can more easily achieve their goals and form stronger relationships with budget and finance teams by speaking in terms they understand.
One portion of the guide outlines several strategies for communicating IT investment needs, such as the following:
- Communicate in terms of quantifiable ROI ... Budget analysts are trained to think in terms of concrete, tangible outcomes, such as the number of people using a digital government service or the amount of days it takes to process a building permit request.
- … But don’t forget “soft” benefits. In addition to showing measurable ROI, be sure to identify less-direct impacts in areas such as efficiency and resiliency. It can be impossible to quantify the impact of strengthening protection against future ransomware attacks, for example, or adopting more-scalable platforms to handle potential surges in demand. But it’s still important to communicate that value.
“Some things aren’t tangible, so it becomes a conversation on how these investments enable government to be more efficient or have better services, and then tying that to things like technical debt and legacy applications,” says Hannah. “For example, if you’re processing millions of applications for unemployment insurance, but you’re still on older technology, you have to be able to explain how an investment in the cloud enables you to keep operations going and process at scale, whether [you’re experiencing] a hurricane or a pandemic.”
- Show achievable impacts. Provide a sense of the technical specifics and implementation milestones the budget team can expect to see. Be prepared to regularly report spending and progress on those specifics.
- Cultivate ongoing support. Find ways to maintain an ongoing relationship with finance teams and other decision-makers. Provide insight into the operational and maintenance side of technology investments and keep decision-makers abreast of technology innovations and options so they have familiarity with them when new opportunities or demands arise.
- Perfect the art of “the story.” Stories and anecdotes resonate well, especially where technical specifics may be less familiar or are difficult to communicate. Provide evidence from other programs, departments or governments that are having success with a similar solution. Discussing how an investment fits into broader goals — how it addresses digital equity, for example, or reduces the carbon footprint or improves employee retention — helps bring the solution to life and give it meaning.
Technology is ubiquitous, but its impact can sometimes be abstract. The challenge is to make the impact of IT investments real to elected officials and budget leaders.
“There is a terrific opportunity to have two kinds of conversations with the budgeting and finance folks right now,” says Justin Marlowe, a Center for Digital Government senior fellow and the associate director of the University of Chicago’s Center for Municipal Finance. “On the one hand, there’s the discussion in terms that they’re used to, like cost savings, efficiencies, ROI numbers. On the other hand, there’s an opportunity to have a parallel conversation with decision-makers and especially elected officials to say, ‘This is not an investment in technology. This is an investment in equity.’ Or, ‘This is an investment in the ability to coordinate more effectively across units’ — all the things that are front and center as we think about not just the pandemic response, but coming back
even stronger.”
For more strategies and best practices on all aspects of funding and financing government IT, the full guide is available to download for free.
