Scotland's Digital Future: supporting the transition to a world-leading digital economy

6 Ways of Working

Previous sections have looked at the actions that the Scottish public sector can take collectively to develop the capability and capacity of Scotland's digital businesses. This section goes further and looks at the way in which the public sector operates; the 'how' rather than the 'what'; and identifies ways in which new operating practices could provide a powerful stimulus to Scotland's digital economy.

Current activity

Scottish Government is changing its old models of service delivery to drive improvement across public services. In Scotland's Digital Future: Delivery of Public Services published in 2012 ^[14] , it set out its ambitions to make online services accessible and easy to use in order to encourage individuals and businesses to make a positive choice to use them. This requires the public sector to work collaboratively across Scotland, making best use of existing infrastructure, crossing organisational boundaries and adopting a 'digital first' approach under which the use of a digital channel is a positive choice.

Early progress towards this vision is being made through the procurement of the Scottish Wide Area Network ( SWAN) which will deliver a single, holistic telecommunications service available for use of any, and potentially all, public sector organisations within Scotland. This is the first project for the overarching SWAN programme. It is also seen in the development of the Mygov programme which will aim to deliver the single access point to all public services across Scotland.

Aligned to this Local Government has developed the Local Government ICT Strategy - Delivering Better Services for Communities ^[15] . This focuses on how ICT can enable Local Government to meet customer demands, reduce costs and address Public Sector Reform. A key objective of the strategy is to increase the number of online services available to the customer, both citizens and business.

On the demand side, the Scottish Government's eCommerce Shared Service brings together all the steps involved in supplying the public sector in Scotland. It is a collaborative electronic environment, which promotes improved capability across public procurement in Scotland. It enables business to be conducted more simply, consistently and effectively, and plays a key strategic role in delivering and sustaining procurement benefits and best practices.

Figure 8: Current procurement channels

However, whilst initiatives such as this have helped support the wider adoption of e-procurement systems, the main impact has been on the process of advertising such opportunities rather than the totality of the customer - supplier relationship (Figure 8). Many Scottish businesses that respond to digitally initiated opportunities continue to limit their digital engagement to e-mail and have not developed e-commerce capabilities more generally. In post-award order processing, for example, only 20% of transactions make use of advanced machine readable formats. The remaining 80% are either emailing pdf images or faxes. A number of businesses are not able or willing to develop the required supporting systems despite the opportunity they offer to speed up the order, invoice and payment cycle. It has been estimated that a 10% increase in the use of e-procurement and e-sales could increase productivity by between 1.2% and 3.6% ^[16] .

Ambition

As digital technology disrupts and rewrites the rules in different markets, it is important that we think again about the role of the public sector in the digital age. We want to make more of the reach, footprint and economic importance of the public sector, to create the kind of industry we want to see in Scotland. Our ambition is that, the Scottish public will add value to the digital economy in Scotland in the way that it chooses to both procure and deliver services. It will provide opportunities for Scottish business to develop digital capabilities and provide a platform for such businesses to compete internationally in increasingly competitive digital markets.

This requires a Scottish public sector in which:

• suppliers are encouraged to adopt and embed digital technologies.
• innovative approaches to procurement that reflect the strengths and ways of working of new digital businesses are encouraged.
• the digital sector has the opportunity to engage in and add further value to the delivery of public services.
• the potential of open data as a driver of economic growth is recognised and realised.

Approach

The starting point for a transformation of this nature has to be a commitment to develop the digital capabilities of staff across the Scottish public sector. Organisations should be encouraged to join and participate in the work of Scotland's Digital Participation Charter to encourage the development of digital literacy across their entire workforce. This should be supported by the development of workplaces and IT policies that enhance access to and familiarity of digital technology.

The Scottish public sector spends around £9 billion on goods and services. Support provided in transacting this business digitally tends to be structured in a way that is of benefit only for the transaction with the public sector, and not in a way which would have a more lasting benefit for the company. A new partnership between procurement specialists and Scotland's enterprise and business support agencies that combines the more comprehensive adoption of advanced e-procurement practices with targeted support for the development of e-commerce capabilities within Scotland's business base would be capable of stimulating digital capabilities across the country. This, in turn, opens up the potential for the public and private sectors to share the benefits that come from enhanced productivity due to a more integrated approach to ecommerce.

With the increasing move towards European standardisation of digital business documentation, the size and consistent nature of the Scottish public sector e-commerce platform provides a unique opportunity to build skills and capabilities within Scottish business in a way that can be a stepping stone to European public sector procurement. A company that develops a capability to transact electronically with the public sector in Scotland will be in a position to capitalise on opportunities to bid for public sector contracts across Europe.

Our approach to procurement of digital services should also be adapted to ensure that the public sector is able to take full advantage of a fast moving environment which is characterised by dispersed skills and new business start-ups. This demands the development and application of an agile approach which is underpinned by a commitment to use procurement to encourage the development of a sustainable digital sector that can innovate within Scotland and use this innovation as a platform upon which to compete internationally for business.

Through the provision of APIs (Application Programme Interfaces) the Scottish Government can enable third party suppliers to offer services and information, in a distributed services model. This provides an opportunity to improve the customer's experience of such services, grow demand for online services and provide a stimulus to Scotland's digital economy by offering opportunities for adding value to public information. A commitment to open public services puts choice and control in the hands of individuals and neighbourhoods, so that public services will become more responsive to people's needs.

Open Data can, in itself, be a driver of economic growth. By making public sector data available in a standardised format for use and re-use, there is the opportunity to stimulate new ideas and business opportunities for Scottish companies. This, in turn, will attract talented entrepreneurs and skilled employees, creating high value-added services for citizens, communities, third sector organisations and public service providers, developing auxiliary jobs and driving demand for skills.

Recommendations

6.1 A partnership of public sector procurement leaders and Scotland's enterprise and business support agencies, including the Supplier Development Programme, should use the public procurement platform as the basis of action to build the capability of Scottish suppliers to both engage with the public sector electronically and then use that capability to compete for business with public bodies across Europe. This requires targeted business support to develop the capability of Scottish suppliers both before and after contract award.

6.2 This partnership should further develop e-commerce Shared Service integration to open European standards. Procurement leaders within this partnership should ensure that Scotland is involved and engaged with establishing a consistent business to business taxonomy for public procurement, based on open European standards, and be pro-active in sharing that standard with business in Scotland.

6.3 The Scottish public sector should build upon its existing commitment to open public data and recognise the potential economic benefit of making such information available to the business community. The availability of such data should be signposted.

6.4 Scotland's commitment to the development of digital public services should include proactive action to open up government system API's to promote market creating opportunities to integrate systems and offer value added services to organisations. This requires action to set-up the market and partner development of digital services, including accreditation of all digital delivery partners.

6.5 The Scottish Government should develop an agile approach that provides public sector organisations with a greater opportunity to access and stimulate agile skills from across the business base and support the implementation of agile software development methodologies. This would be particularly useful in the communications, proposition/product definition and agile software sectors.