IfG.CC - The Potsdam eGovernment Competence Center

Most government return on investment and business case methodologies don’t measure the very real and quantifiable benefits that accrue to citizens and businesses from e-government investments.

One reality of globalization is that businesses can move their operations more easily than ever before. This is forcing cities, states, provinces, and countries to compete more vigorously in a host of areas to attract and retain businesses and knowledge workers. Tax laws, the legal system, and the regulatory environment, are critical to a company's decision on where to locate. Other factors such as the quality of life, education, and infrastructure also shape the view of how attractive the business climate is in a particular jurisdiction. The sum of how a government competes along these dimensions is a gauge of its economic competitiveness. One critical area of competitiveness where governments have a defining role to play is regulatory compliance. When Boeing announced its decision in 2002 to move its headquarters from Washington State to Illinois, it cited burdensome construction, zoning, and land use regulations in the state as a prime factor for its decision. It should come as no surprise then, that many governments have made regulatory streamlining a top priority.

One of the most powerful ways to reduce compliance costs is through electronic government. Web-enabling and streamlining permitting, licensing, and reporting requirements can save businesses and citizens considerable time and money as these examples demonstrate:

• The State of Oregon’s one-stop process for building construction approvals, which includes online permitting and reporting, saves the construction industry 10 percent, or $100 million annually, in reduced delays and permit processing costs according to state officials. If governments at all levels were to follow Oregon’s lead, the US construction industry as a whole could save between $15 to $20 billion per year.

• The US Small Business Association’s Business Compliance One Stop Web site, saves businesses about $526 million a year by helping them find, understand, and comply with regulations.

• In Canada, the province of British Columbia’s OneStopBC Web site cuts down on government paperwork costs for businesses by making it possible to apply for federal, provincial, and municipal business license registrations online in one place, rather than having to file with each level of government. The cost savings to businesses from having such a Single Business Number registration number are estimated to be in the range of $14 million to $27 million annually.

Unfortunately, such benefits are rarely reflected in the evaluation of government IT investments. Most government Return on Investment (ROI) and business case methodologies don’t measure the very real and quantifiable benefits that accrue to citizens and businesses from e-government investments. This needs to change.

The value of a government investment has to be measured not only by its direct return to government but by its return to the people on whose behalf the investment is actually made —the citizens government represents and the businesses that citizens work for and invest in. ROI should take into account, to the extent feasible, the complete spectrum of economic, social, and cultural benefits and costs of each individual element of an IT investment. This model of ROI—which we call Citizen Advantage™—measures the benefits to government as well as to businesses and citizens, providing decision makers with a fuller picture of the costs and benefits associated with IT investment opportunities.

Constituent Costs and Benefits

The costs that government rules and regulations impose on citizens and businesses generally fall into three categories:

1. Finding which rules and regulations are needed for compliance.
2. Understanding what the regulations mean and figuring out how to comply with them.
3. Complying with rules and regulations (typically the biggest cost driver for citizens and businesses).

E-government isn’t usually the first thing that comes to politicians’ minds when they’re debating what government can do to enhance constituent value, make compliance with government rules and regulations easier, or create a favorable business climate. However, by minimizing the amount of time and effort it takes to comply with government red tape and complete government transactions, e-government can have a positive impact on both business productivity and people’s quality of life.

To read the complete Deloitte Research study in PDF form, click here.

Quelle: Deloitte Consulting