There’s a saying in industry: You’re better off to disrupt yourself before someone else does – and at least then you can reap the advantages of it!

If it involves digital and the NSW Government, it is almost certain to have passed through the deft hands of Katarina Ruszczyk.

A former Director of Digital Transformation at the Department of Customer Service, a driving force for the state’s Digital Government Strategy, a leader of the Digital.NSW Accelerator, and a veteran innovator across every level of government, Ruszczyk has been at the forefront of public sector transformation for well over a decade – an ever-present disruptor with human-centred design at her core.

Offering candid insight into her time in the public sector, Katarina discussed our governments’ readiness for disruption, the unfulfilled potential of citizen co-design and blockchain, and why ‘rules as code’ could fundamentally reshape the policymaking process.

FST Government: As a veteran innovator and public sector disruptor, what excites you most about the digital potential of government, particularly as a force to empower and engage citizens?

Ruszczyk: What I really love about digital is its potential to solve the big problems of government.

Governments are vested with the big problems of society – from people’s freedoms to health and commerce. On top of that, the world is rapidly changing: we’re dealing with climate change, we’ve got economic structures shifting from traditional industries to gig economies, work has evolved to a decentralised model with remote working. The way that government operates needs to shift, and the way that it can shift and be more agile is through digital modes of delivery. That’s what I get really excited about: digital being a complete enabler to government helping society flourish.

The old ways of doing government are slow, clunky and often don’t work. But digital modalities of service delivery, and everything that’s required to do that, changes the way citizens are engaged and empowered. Through it, governments finally understanding that they need to listen to citizens first before designing their services.

 

I’ve worked in policy for 15 years across federal, state and local governments. Previously, public consultation was done at the end of the policy and the legislative drafting process. Increasingly, what’s happening now with digital delivery is, with human-centred design, your problem is what the citizen’s problem is – it’s not what you assume it to be. This shift really excites me: the possibility that governments could co-design not just services, but also policies, regulations, and legislation with citizens. That data could be shared freely within government – which is not at the moment – to allow the best use of data analytics to revolutionise the way we work and live.

FST Government: Having served over a decade across several Australian governments, would you consider our public sector, overall, ‘disruption friendly’?

Ruszczyk: I really like this question because disruption, by its very definition, is not friendly. It’s just good old-fashioned competition.

There’s a saying in industry: You’re better off to disrupt yourself before someone else does – and at least then you can reap the advantages of it!

 

So, on the whole, absolutely! I think federal, state and local governments are very adaptive to disruption. A lot of work has been done in the last few years across all levels of government to achieve this.

In 2015, with the arrival of Uber and Airbnb, the NSW Government proved then that they aren’t just ready to adapt, but to also take up this new technology.

The arrival of these tech giants in Australia kicked up a big stink with incumbent industries, which challenged their entry. But it was clear that with the arrival of digital-native companies in Australia a shift was underway. It wasn’t just a new industry; it was a shift in an economy.

I led the team in NSW that, rather than putting out a policy that simply blanket regulated these new disruptors, we convened focus groups (led by the Hon Victor Dominello MP, now Minister for Customer Service and Minister for Digital) to listen to the new players’ concerns and needs. That was the first time a regulatory policy had been developed in this way – and that approach has led to other regulations being developed in that way.

We acknowledged that, for the first time as a government, disruption isn’t necessarily bad; that, yes, disruption is just good old-fashioned competition.

 

All in all, it’s forced us to also look at the purpose of regulation. And what is that? It’s to ensure that safety protocols, ethical considerations, privacy considerations are all met to protect citizens’ data and privacy.

At the heart of it, government is the trusted provider of many services. Not having competition in these areas can actually lead to a culture that is less innovative and more risk-averse.

 

Being disruption-friendly is therefore kind of a misnomer. Disruption signals new things coming, and the change that’s needed; most governments are willing to do that.

FST Government: Digital transformation has been an overriding ambition, and indeed catchcry, of both business and government over the last decade, arguably to the point of being passé. What to you defines a successful transformation in a public sector context?

Ruszczyk: The term ‘digital transformation’ could certainly be considered passé now. Not that all the work in digital is done, but the operative word here is ‘transformation’.

Last year’s response to the Covid pandemic – with organisations scrambling within days or weeks to equip staff to work at home remotely, digitally and virtually – proved governments can move and make decisions quickly.

However, just having business processes on digital platforms doesn’t mean that a business unit has been transformed. True transformation comes from how those tools are applied for better meeting the needs of their customers and designing their services around the voice of the customer, reducing duplication of effort (re-using digital components), gathering and sharing data insights to inform business decisions, and is collaborative with stakeholders (be it other team members, agencies or community).

A successful transformation is one where the business unit accepts that change is constant.

It is one where the business processes are changed to constantly be iterating their service offerings and have a process embedded that brings the voice of their customers (citizens) into the service design and decision-making. It is also one where decisions are built of data insights, where the model of delivery is joined-up and connected into other agencies that may have the same customers – sharing data, feeding back insights, streamlining processes, and having multidisciplinary (and sometimes multi-agency) teams.

This is still a process that governments will be going through for quite some time (if not indefinitely).

FST Government: Where do you see the biggest hurdles to innovation, and how can progressive innovators negotiate their way around these roadblocks?

Ruszczyk: The biggest hurdle I see is the ability for an organisation is to see that their problems are the problems of the people they serve – their ‘customers’. It takes a lot of organisational change to break down a problem into small, bite-sized chunks to solve and to talk to their customers about that.

The technology is just the enabler– the bits you use at the end to deliver the answer. But it is not a process you use to solve the problem.

 

Solving this problem requires talking to customers, a design process, including teams from other departments, sharing problems and deeply understanding all facets of what you do, how you do it and why and then having the courage to potentially change the way you are organised. It requires sharing data and resources across siloed operations, it involves investments – often in an un-quantifiable solution.

The other challenge is to have the “right” technology available to allow for services to be consistent, based on shared data and joined up around the customer. Building a government platform from which to build services around customers is the way of the future. Multi-agency services are the biggest opportunity for government to satisfy customers and it is probably the hardest thing to deliver.

FST Government: We often frame digital innovation as an inevitable force for good. However, high-profile instances of tech misuse – for example, the ‘robodebt’ scandal or unsanctioned accessing of Covid tracking data – reveal the inherent risks of embracing a tech-first approach without the regulations to contain its (mis)use.

How can we inspire innovative use of technology in government, embracing transformative technologies like AI and automation, without infringing on citizens’ rights?

Ruszczyk: I’d say it’s not the technology causing the misuse or breaches, but rather the application of the technology into a system where the social and cultural processes around it haven’t changed or adapted.

Technology is pretty pure. It exists. It doesn’t make decisions about how it exists; it’s the people that use the technology that misuse it.

There’s always going to be bad people misusing technology. And, most often in government, you’ll find it’s good people just doing stupid things with the technology, rather than being motivated from a bad place. But these instances highlight to me the need for appropriate privacy and ethical controls. When we’re talking about AI, absolutely, these practices need to be embedded before these technologies are rolled out.

Most importantly, I’d suggest we need to ask the question why?: Why are we doing this? Why do we need this technology? What is the problem that it’s trying to solve?

I’d suggest that, when they brought in the technology behind ‘robodebt’, they didn’t go through this process. They simply brought in these big whiz-bang technologies that weren’t necessarily aligned with a starting purpose – that is to first ask “What problem are you trying to solve with this technology?”. If they’d started with that process, the parameters of its use would be very clearly defined.

This is, essentially, a cultural problem – an example of technology being misused and not an enabler of a service. They haven’t gone through the process of figuring out what problem is that they’re trying to solve and staying aligned to the mission of government, which is to serve its citizens.

FST Government: The public sector is often – and perhaps unfairly – criticised for its perceived inertia and lack of responsiveness. How can we overcome risk-averse thinking in government to create a responsive, citizen-centric administration?

Ruszczyk: Let me first say that it’s important that government, in its operation, is trustworthy, consistent, and reliable. With government being tasked with providing services that affect people’s livelihoods, freedoms, health, and commerce, it’s essential that those services do consider the risks and they are consistent. This can often be considered anathema of innovation, which is simply seen as ‘just building things’.

But I would challenge the assumption that working in an agile way is risky.

 

Building things in an agile way, deeply understanding the problem that you’re trying to solve, talking to the people that experience those problems (i.e. the citizens), biting off small chunks of money to build prototypes, which you then iterate based on the feedback with the people that will use them, the citizens, is the most risk-averse way of doing things.

That’s quite opposed to what we’re doing now: we have an assumption about a problem, we spend, say, three months drafting a policy proposal, we then go to a procurement process that might last six months to bite off a huge chunk of money to build an IT platform that might cost millions of dollars to implement, and then three years later, you’ve got a process that is completely not fit for purpose.

Innovation in government gets a bad rap. It simply means doing something that’s not the status quo – doing it smarter, not harder.

 

It’s actually riskier for governments to keep going the way they’ve been going: it often leads to budget or inefficiency blowouts and citizens’ needs not being met.

We still have children living in poverty, we still have horrific domestic violence problems, we still have climate change issues. These issues haven’t been solved or addressed to a point where people can say that society is really flourishing; this, ultimately, is meant to be the purpose of government. We need to do things differently.

Innovation, human-centred design, agile service delivery, and agile project management are opportunities for us to do things in a better way to achieve society’s flourishing.

FST Government: What’s one area in government you consider ripe for an innovation overhaul?

Ruszczyk: Most definitely the legislative process. We talk a lot about service delivery, but the bread and butter of government is policy development, legislation, and program delivery – and that may or may not actually have customer-facing interactions or immediate interactions. But this key government process is still largely operating an old-world type of way.

One of my pet projects is human-centred design in the policy process. It is just so important. The uptake really hasn’t been there, and I just don’t understand why. I speculate that it’s because the machine is perhaps risk-averse, in the old-fashioned sense; it doesn’t yet have enough examples of how it can be done in a better way.

Procurement policy is another area that’s ripe for innovation. The lack of diversity and inequality in government is hindering innovation. The cultural practices of government, based on the hierarchy of power, also hinders innovation.

FST Government: Do think there is a sense of fear among policymakers that by straying from the status quo, inviting more technology or advancing digitalisation into these policy processes, they undermine their own roles?

Ruszczyk: Absolutely! Consider the Customer Service Department’s website on ‘rules as code’. My colleagues set this up as a policy lab, embracing a human-centred design approach to develop new ways to deliver legislation.

This is essentially weaving technology into the regulatory space. It blows my mind! It changes the nature of regulating a space to a decentralised model, embedding the rules throughout society to where people are, rather than relying on a centralised model of justice to enforce the rules.

There are exciting opportunities to disrupt the traditional legislative and policy process, and there’s definitely some fear about this new way.

 

But when you’re dealing with a system that is totally stacked in favour of this old-world thinking and hierarchy of power, of course it’s going to take hard work to change the system. There are exciting possibilities here.

FST Government: You’ve worked extensively with the NSW Government over your career, arguably one of most progressive eGovernments in the world. What are some of the lessons fellow governments can take from NSW in advancing digital government initiatives?

Ruszczyk: I’d break it down into five key learnings.

1. Firstly, that IT is not the same as digital – digital requires human-centred design first to deeply understand the problem; IT just requires you to build something you think is a solution. The same goes for program delivery or policy development: you need to ask customers (or the owners of the problem) what they think the problem is before you start building a program plan or writing a policy proposal.
2. Do things out in the open – show your work whole as you’re doing it, not just when you consider it “finished”; admit that you don’t have all the answers and invite others in to work with you to find them.
3. Look around and find out who you share a problem with – they may have already found a solution they’re willing to share with you for free. This means building networks with your counterparts in other agencies and also with industry.
4. Don’t be afraid to propose ideas that others might think are crazy – the future favours the bold. No one can really tell you how to transform/innovate/or disrupt yourself. It’s something you must figure out for yourself. You are the expert in how your organisation works, so figure out how it could work better by talking to your customers first.
5. Find out what your customers think is the problem and then go from there – the voice of the customer is gold – not just in doing the right thing, but also when it comes to seeking approval from senior decision-makers!

FST Government: You touched on blockchain before, which is set to have a transformative impact on our financial sector and economy. For better or worse, what one technology do you believe will fundamentally transform how government is run over the next five years?

Ruszczyk: I see two in particular. The first is blockchain. Four years ago, I was telling everyone I could inside government about blockchain, running seminars and workshops for senior people.

Blockchain’s potentially the most revolutionary technology in decades, especially within a government context.

 

The problem is that we haven’t yet had that killer app to best demonstrate its use. And because of that, there’s been a lot of reticence to even apply it. That being said, there’s obviously some low hanging fruit – for instance, with the land titles office, ‘rules as code’, and automation of processes or supply chains. Blockchain has the potential to disrupt any industry where there is a ‘middle-man’. I see it like emerging solar panel businesses back 40 years ago when they were trying to disrupt the energy industry.

The other big one is artificial intelligence and machine learning. And it’s not just coming – it’s already here.

If the appropriate privacy and ethical controls can be put in place, AI provides opportunities to better access cross-agency data to resolve technical problems, ensure better data governance, interface with customers and stakeholders, get better insights, and predict problems before they happen and plan.

 

For all those levers that government pulls to make decisions, these technologies are revolutionary.