Technology: Tackling Public Sector Corruption Starts And Ends With Technology

1999 was a big year for Nigerian technology. The fear of the Y2K bug and the drive by institutions to become compliant was a boost to hardware sales and software implementation. Proposals got sent to everyone, and we were lucky to have been chosen to implement our custom built ERP solution for one of the largest federal government parastatals.

When we started implementation, the first surprise I got was not that they had absolutely no processes in place and were relying on bank statements alone. It was that, there was an articulate process manual provided that they had abandoned. Someone had painstakingly done the work of reviewing and documenting public sector processes and had produced a manual to guide our implementation. This manual sped up our implementation process, and the client was surprised at the results. It revealed things they did not want to be exposed and we were promptly kicked out with payments still outstanding to us. This project was our first stint with a public sector establishment as a technology company, and it almost made us give up on the sector entirely.

Change Management lessons

We tried our hands at public sector technology once again when I discovered that my friend David, who was a Finance Commissioner in one of the states, had to sign ten thousand payment warrants every month physically. He wanted that fixed and also wanted his accounts payable process revamped as there was proof that massive fraud was going on because people were taking advantage of the manual method.

We went through a competitive tender process and won the bid to implement SAP financials for David’s ministry. It was one of the most exciting and profitable projects I had executed, and it showed a lot of promise. The only problem was once again “people.” Getting them to use this new “world class” technology was a nightmare. It made me realise the importance of the soft side of tech implementations. Training and Change Management were more critical in the public sector than anywhere else.

Technology is all about change, and people are creatures of habit. Getting both to work together meant understanding implementations and executing workarounds. I learned while in graduate school in the UK that technology projects fail when we typically view them as technology projects instead of “Business or Process Change” initiatives. 60% of ERP implementations at that time had been unable to achieve their objectives as either those objectives changed or the people sabotaged the efforts.

I realised eventually that technology itself IS “Change.” Change Management is managing the technology delivery process to deliver real value.

The Optimization vs Innovation dilemma

There are public sector projects that have been successful. While consulting for the IFC, I had insisted that SocketWorks consider outsourcing solutions for Healthcare, Education and Government. They were the sectors with the most need for outsourced services as the strategic impact was high, but resource availability regarding human resources was low. SocketWorks successfully implemented its outsourced model for education and government.

Outsourcing is an innovation when it comes to government technology. The default model is typically to optimise processes. The truth is that government has no business with running any technology, they only require processes to be streamlined and value delivered by the right means.

Immigration and educational institutions processes are now vastly improved with Socketworks outsourced technology. The current Treasury Single Account (TSA) and Bank Verification Number platforms in Nigeria are examples of outsourced operations that have yielded significant value.

The flaw with internalised optimisation models as I found out with my first public sector stint is that the outcomes are at variance with the motivations of those who benefit from manual and opaque processes. No amount of change management or arrests will stop corruption if it is effortless to achieve. Institutions have to be optimised from outside by fiat or brute force as TSA and BVN have done while taking steps to make fraud practically impossible to achieve or hide in the public sector.

How technology can help end corruption

I discovered while working on public sector projects in Nigeria that our standard processes are amazingly simple. Too simple in fact and that is why loopholes get found quickly. I am sure most income and expenditure accounts of most public sector establishments can be run on a spreadsheet. Opacity is created by deliberately contrived manual processes to keep people employed and aid corruption. I discovered once that a higher institution had 400 students but 2000 staff members. We can quickly do the mathematics to identify fraud when things are transparent.

Ideally, the job of tech is not to stop corruption but make it impossible to hide it. I, however, believe that tech can even be more aggressive to create change. BVN verification alone has removed a lot of ghost workers from payrolls. Solving the identity problem at a macro level has had tremendous impact at the micro level.

Identity verification and process transparency have led to more arrests by law enforcement because technology works. I believe it can even work better when the government is more deliberate about fully enabling outsourced technology-driven processes at all levels. The most significant value of technology in governance is transparency and permanency. You can destroy paper trails, but you can’t burn replicated cloud storage.