As we stated in this series’ first publication, GovTech ecosystems bring great opportunities for local governments that wish to transform and digitize their operations and for innovative companies (startups, SMEs and scaleups) that want to grow by developing solutions for major public challenges. In addition to making these opportunities a reality, the GovTech space transforms our public institutions by generating new work culture.
Change is complex, and therefore, to succeed in the GovTech space, it is necessary to develop a strong strategy and learn from international experiences. A GovTech strategy goes beyond generating a laboratory or a specific entrepreneurship program. It involves articulating an ecosystem of new actors, promoting transparent and cross-sectorial collaboration with other departments and generating public services by leveraging data and new technologies. The process of developing a GovTech ecosystem strategy will vary according to the potential and momentum that each of these area’s has.
Four ideas for local governments to consider
In this second GovTech focused post, we present four key ideas, supported by international case studies, for local governments to consider once they have decided to create their strategy.
- A GovTech ecosystem needs both vision and political support. Once the local public sector’s actors and internal resources that can be leveraged are identified, a clear roadmap must be generated. The roadmap must take into account the budgetary, political and regulatory cost of the measures to be implemented. A good dose of political momentum must also be added. The GovTech space forces a transformation on municipalities’ systems, cultures and incentives and may clash with internal interests, regulations or rooted institutional practices. Change is only possible with positive and strong political support and a strategy that clearly considers risks and opportunities. For example, in Norway, the starting point was the detection of areas in which the local government needed to strengthen its services with the participation of the GovTech ecosystem with the support of Stimulab. In the case of the Israeli city Beer Sheva, their priority was to become a cybersecurity hub. To do so, they mapped the potential of the local ecosystem, shared the vision and promoted interaction between the different actors.
- The generation of a GovTech ecosystem is a gradual process. Most of leading institutions started by visualizing the potential of GovTech by generating challenges and events that allowed to bring the ecosystem actors closer together. With these insights, they developed instruments or policies to awaken public demand for new solutions, creating open innovation processes, or designing public tenders directed to small and medium-sized digital enterprises. Lastly, certain institutions opted to support the growth of digital startups and SMEs by prioritizing the GovTech space in their entrepreneurship programs or by allocating grants for urban accelerators. The more sophisticated ones, such as in the case of Singapore, invested directly in these companies.
- Local governments need to articulate and extract maximum value from the interaction of the various actors in the GovTech space to generate synergies. A successful strategy must be based on connecting and understanding the interests and added value of these actors to the GovTech space. Investors, large corporations and universities play a key role in this space. There is a need for venture capital funds to invest in innovative companies and support their research and development activities. Also, it is necessary for entrepreneurs to collaborate with corporations to bid tenders, introduce their technology to larger companies, and entice them to invest in the company. Finally, the city’s universities can be great sources of knowledge and technology transfer, in addition to being the cradle of many GovTech ventures. In short, local governments have to interact with these diverse actors to generate the best solutions to their needs and those of the citizens.
- Previous investments must be activated and leveraged. Although GovTech is a new space, cities do not start from scratch. To develop the best GovTech strategy, an analysis must be conducted on the capacities and programs already existing in public institutions to take advantage of them and articulate them correctly. There are already entrepreneurship or public innovation programs that can contribute immensely to a GovTech strategy. Also, it is necessary to identify those key public practitioners with capacity, passion, institutional influence and ability to integrate the GovTech strategy into the institution’s daily operations. A GovTech strategy does not have to be costly or involve a large additional budget if it takes advantage of previous policies and activities, and especially the internal talent of motivated public workers. This can be facilitated by establishing a clear reference that articulates interactions, either by creating specific spaces or a program that has a presence in different locations leveraging the existing network. Some cities, such as the city of Tel-Aviv, have created an urban LAB “CityZone”. In other cases, as in the case of Bar-Ilan University, the University itself is used as a field of experimentation and a center for the GovTech ecosystem to grow in all the surrounding cities.
Examples of GovTech initiatives
In the LAC region there are early examples such as MiLAB, created by the Colombian government in partnership with CAF – Development Bank of Latin America, the 100% GovTech public innovation laboratory. Under this collaboration, MiLAB will advance the first mapping of Colombian digital startups that use emerging technologies and solutions to address the needs of public innovation. Also noteworthy in the region are the bootcamps developed by the city of Cordoba (Argentina), and CORLAB, Public and Social Innovation Laboratory of the Municipality of Cordoba. CORLAB is a space to experiment and generate public value, enhance the relationship with citizens, provide new channels of participation and collaboration from the implementation of agile working methodologies. This initiative includes a “Smart Cities Radar”, an accelerator, and various activities and events for startup.
Other examples at the international level can also serve as inspiration in the region. Among the programs and policies aimed at generating demand for new solutions, those developed by the UK Government stand out. Since early 2010, the UK generated a series of actions to facilitate public procurement access for small digital companies. This process culminated in 2017 with the development of programs that approached, through non-traditional channels, new digital suppliers to specific challenges of their government units. Thus was born the “GovTech Catalyst Program“, a multidisciplinary team, part of the Government Digital Service, which was responsible for defining challenges, identifying innovative companies, co-developing solutions, and testing them. The program was accompanied by the “GovTech Fund” with 20 million pounds to pilot new ideas. In Europe, the great work of GovTech Polska, an experimental unit founded in Poland’s President Office and which has now been institutionally consolidated in the Government, also stands out. Other countries such as Lithuania, Denmark, Israel, and Portugal have developed their GovTech programs, each with characteristics and strategies adapted to their institutional context.
There are also private initiatives that demonstrate the dynamism of the GovTech space. In the region, BrazilLAB is considered the first GovTech accelerator; Govtech Peru and the Govtech Hub, which organize meetings and spaces to boost the ecosystem. At the international level, the English PUBLIC, a hybrid between accelerator, investor, and promoter of the European GovTech ecosystem with its GovTech Summit; the Silicon Valley venture capital fund GovTech Fund; the Israeli open innovation consultancy GovTech Creators; or IE University with its PublicTech Lab. These players, without a doubt, are strategic allies for local governments that are determined to walk the GovTech strategy.
GovTech ecosystems are already a reality and a way to drive digital transformation in local governments in Latin America and the Caribbean. In addition to international initiatives that can serve as inspiration, there are already many experiences, programs, and policies at the regional level that can be leveraged to boost the GovTech space in Latin American and Caribbean cities.
Do you consider that your city has elements and preconditions that would help to articulate a GovTech ecosystem in your territory? We are generating a regional GovTech ecosystem, and we would love to know more about your municipality. If you are interested, please write us in the comments to continue the conversation.