An Interview with Dr Jonathan Reichental, Chief Executive & Founder of Human Future and former CIO of the City of Palo Alto


“To create government agencies and their employees that embrace change means we need to radically change the motivation schema. That’s hard and it doesn’t get done with a few pep talks and a vision statement.”

Dr Jonathan Reichental has spent the better part of his career at the vanguard of transformative innovation. As the long-serving Chief Information Officer of arguably the world’s most technologically progressive jurisdiction – Palo Alto, home of the original Silicon Valley – Reichental has been widely acknowledged, and duly decorated, for his role in fuelling the innovation spark that ignited the seismic social changes being unleashed by today’s ‘bigtechs’.

We spoke with Dr Reichental on some of the definitive trends and ideas shaping digital government today, from the tidal wave of Fourth Industrial Revolution technologies (the blockchains, AI and automation tech, to name a few) sweeping digital processes to top-line strategies to help guide public sector administrators through an environment of persistent change and transformation.

FST Government: You served as the City of Palo Alto’s Chief Information Officer for more than seven years – a jurisdiction which boasts the headquarters of some of the world’s most high-profile tech companies. Besides the obvious boon from tax revenue and jobs creation, what – perhaps less tangible – benefits did the Palo Alto government reap from homing these tech giants? Can Australian cities take any lessons from Palo Alto in luring such innovation powerhouses to its own shores?

Reichental: I think your question nails the big positives: high tax revenue and jobs. The presence of tech leaders and venture capital also continues to define the brand of the City which in turn perpetuates more investment. Perhaps surprisingly, outside of the tech focus, Palo Alto is a small and quiet town.

Regarding lessons for Australian cities, the answer is broader than the City of Palo Alto. California has a rich culture and history of openness and risk-taking. It’s further amplified by a mature ecosystem of available capital, talent, incubators, and accelerators of innovation and a network of support. Many communities fail at creating their own Silicon Valley because some of these things just can’t be built overnight.

We’ve been doing innovation here for a long time. And beyond building it, there’s a large element of philosophy, enabling-regulation, and culture that has uniquely evolved and codified. My advice would be to move beyond just building innovation ‘centres’ – which are important – but also looking at the larger and deeper levers that need to be fostered.

FST Government: You’ve emphasised the importance of an adaptable and receptive organisational culture in driving innovation in the public sector. Yet too often government agencies are hamstrung by entrenched staff who fear change and transformation. How can government support a cultural change-friendly environment that ensures everyone is along for the same transformation journey?

Reichental: I continue to be fascinated by the important role of behavioural economics. Why do people and institutions do what they do? What are their incentives and motivations? Having worked in both the private and public sector, I now see very different dynamics in play. To understand how to align employees with an organisational vision requires a deep understanding of behavioural economics. In a simple example, why would a public employee take increased risk, when the rewards for taking no risk are identical?

To create government agencies and their employees that embrace change means we need to radically change the motivation schema. That’s hard and it doesn’t get done with a few pep talks and a vision statement. I would suggest compensation (not just monetary) and performance measures as some areas to pay more attention to. If employees know that their success is entirely dependent on alignment with a transformation plan, their behaviours may change. Finally, government agencies need to have a recruitment strategy that brings in new employees that reflect the type of organisation it aspires to be.
FST Government: Government agencies are known for being risk-averse. Yet innovative thinking can only truly flourish when ideas can be put to the test – without fear of failure. How can government support an innovation-friendly environment whilst reducing the risk of costly and potentially harmful outcomes?

Reichental: Once again, this becomes a question of incentives. Why would an employee take a risk – even with a potentially large upside – if the possibility of failure would find no support and could be career limiting? My observations suggest that government leaders want innovation but aren’t always willing to support the risk associated with it. The solution is multi-dimensional. The agency must make the decision to be one that embraces innovation as a way of doing business. This is a firm policy decision – it can’t be implied; it must be codified. An agency must gain the support of its community for its innovation activities. Detailed and sustained community dialogue and communications must be pursued. Finally, determine the right balance between day-to-day operations and innovation activities.

Start small. Don’t take risks on the big stuff. Build confidence. And most of all, share in the consequences of success and the failures equally. Learn from both.
FST Government: Today, you serve as the CEO of Human Future, a global consultancy that readies organisations for the influx of next-gen technologies. How do you foresee Fourth Industrial Revolution (4IR) technologies (for example, the internet of things, blockchain, AI, machine learning, robotics etc.) impacting the way governments transact and interact with their citizens? Are these technologies ultimately a force for good or should we be wary of their potential to undermine established state structures?

Reichental: The fourth industrial revolution will be a massive disruptor to every industry, including government. It is already creating change. Private sector efforts in transportation, housing, energy, communications, and service delivery all already impact government and cities. Each is creating challenges to the status quo as it relates to regulations, laws, privacy, community expectations, and more. And we’re just getting started. It’s easy to focus on the downside of urban progress, but when examined objectively, government and city innovation powered by new technologies have largely resulted in positive outcomes. Urbanisation in the late part of the 20th Century and through the 21st Century so far has resulted in bringing millions of people out of poverty. New services are making it easier for more people to access areas such as healthcare and education. Sure, more needs to be done, but the trajectory is positive. Of course, there will be change and often it will be complex, and many will resist. Each community will need to approach the future in a way that best aligns with their culture.

While we’ll all need to tackle some difficult issues, for example around ethics and privacy in technology, I believe that the interactions between government and community can be largely positive if approached with openness and collaboration.
FST Government: Blockchain has promised much in improving the efficiency and efficacy of public services, as well as boosting public confidence in government transactions; however, interest in the technology has waned of late. What potential do you still see for DLT in the public sector, and should there be a greater push by governments to explore its implementation?

Reichental: It’s far too early to tell what the role of blockchain will be in government. Right now, there is some fascinating experimentation being done and many governments all over the world are encouraging and supporting this work. Areas that are of interest include identity management and records management. However, we shouldn’t focus on the technology for the sake of the technology. What makes sense is to try to solve difficult challenges that governments face using new ideas and available technology. If blockchain has a role, then it should be used. There are many amazing new technologies emerging, and we need to apply the right solutions to the right problems. What’s important is that government adopts the culture and processes to support innovation and experimentation.

FST Government: The Smart City initiative has taken shape across the globe, with several jurisdictions introducing an array of data gathering IoT sensors across their urban patches. How important is it for governments to embrace a ‘smart’ approach in their urban planning? What role can these data-gathering technologies play in enhancing governance structures and in creating a more people-centred public service?

Reichental: First, what is a smart city? I define it as using technology to improve liveability, workability, and sustainability. Assuming a government does this, including adopting some necessary innovation processes, then they are taking a ‘smart’ approach. Each community will do this consistent with their needs and capacity. There is no one-size-fits-all. There is no standard checklist. What matters is what is important to each community.

No doubt, technology can give a government new tools to solve problems. Ignoring this possibility can limit the options available. One of the ways governments can be smarter is to use data to inform decisions and to improve services. Data has been a boon in the private sector and, finally, the public sector is beginning to see and use its advantages. Government agencies have always captured and used data – I’d argue it’s one of its core competencies. Today, there are many more ways to capture data about a far greater number of things.

While we should not lose sight of privacy and ethical considerations, governments must bring on the talent and use data to improve operations and services. Finally, collected data likely belongs to the community and effort must be made to make it easily accessible. Opening data improves democracy and may enable the best ideas and solutions to emerge from within the community.

FST Government: Increasingly, governments are seeking to personalise the customer journey – at the FST Government NSW conference, Estonian Government representative Andrus Kaarelson went further, speaking of agencies’ capacity to predict customers’ demands before they even approach a government agency. What is the biggest hurdle for the government in tailoring their service offering to individual citizens? Is there a ‘silver bullet’ technology or a new regulatory framework that could be leveraged to drive these initiatives forward?

Reichental: The limitation is no longer technology; the limitations are funding, prioritisation, talent, and a culture open to completely new ways of doing things. Without one or more of these, at a minimum, it will be difficult to pursue new, ground-breaking approaches, such as personalised experiences. If a government wants to deploy a new solution, there are available partners ready to make it happen. The agency needs to be ready and willing though to make it happen. It’s always good practice to have participation from the community it services too.

FST Government: How important is it for government to be a catalyst for digital innovation rather than merely a conduit for private sector innovators?

Reichental: Government has always had an important role in innovation. Just consider the US space program, the global positioning system (GPS), or even the Internet. These are all government programs that have given rise to amazing innovation in society. This will continue.

In addition, government has an enormous role in enabling innovation to prosper. Does it have the right balance of regulation? Are the incentives in place? Public-private partnerships have had success in making difficult projects happen. For example, government can bring scale and financial resources and the private sector can bring risk management and talent. Ultimately, I believe the government has multiple roles in helping digital innovation prosper and improve the quality of life for the most amount of people.

FST Government: As a respected and highly decorated digital leader, what particular qualities do you feel set the best leaders apart from the rest?

Reichental: Thank you for that kind comment. This is a big question.

I’m often asked what I believe have been the reasons for my own success; I usually point to patience and perseverance. Things don’t happen as fast as we would like and, along the way, there are more obstacles than enablers. If you can remain determined, with the power of your convictions, and work through each obstacle, you can certainly increase the likelihood of success. I also think that life-long learning is essential. I can’t believe it, but I feel I am learning more now than ever before, including all the degrees I attained in different schools.

Being open to new ideas, being a great listener, being a person of action, getting stuff done, and making a difference in almost everything you do; all these things can go a long way.  ⬤

Don’t miss Jonathan Reichental’s featured keynote presentation at the FST Government Victoria conference on the 24 July, 2019. Places are limited! Register now to secure your spot.