The Impact of eGovernment Failure

Many e-government projects in developing/transitional countries fail. What are the costs of failure? And can failure have any benefits?

The Potential Costs of eGovernment Failure

Six categories of potential costs of e-government failure can be identified.

1. Direct Financial Costs . The money invested in equipment, consultants, new facilities, training programmes, etc.
2. Indirect Financial Costs . The money invested in the time and effort of public servants involved.
3. Opportunity Costs . The better ways in which that money could have been spent, if it wasn't spent on the e-government failure.
4. Political Costs . The loss of 'face' and loss of image for individuals, organisations and nations involved in failure.
5. Beneficiary Costs . The loss of benefits that a successful e-government project would have brought.
6. Future Costs . An e-government failure increases the barriers for future e-government projects. It does this in two main ways. First, through loss of morale of stakeholders, particularly e-government champions, who may 'defect' to the private sector or overseas. Second, through the loss of credibility and loss of trust in e-government as an approach to change. This increases risk aversion in some stakeholders; and provides support for others with vested interests in the status quo.

A key problem among e-government practitioners is a lack of awareness of these costs. Most costs are intangible; few are ever measured in the event of e-government failure; e-government failures are often "hushed up". This may explain why, despite the high costs of failure and the high prevalence of failure, many officials and politicians are still very keen on e-government.

The Potential Benefits of eGovernment Failure

Five categories of potential benefits of e-government failure can be identified.

1. Knowledge Generation 1: Application Learning . Failure can be a kind of very costly prototyping: filtering out unworkable ideas in the e-government application, and pointing the way for a better design of version 2.
2. Knowledge Generation 2: eGovernment Learning . Failure can develop some valuable lessons about e-government for those involved; e.g. that ICTs are not a magic wand to solve all government problems.
3. Knowledge Generation 3: Situational Learning . Whether a project succeeds or fails, the process of analysis and design can help those involved understand their organisation's processes, structure and culture.
4. Skills Acquisition . Even failures typically involve training and skills development; this might be formal training (e.g. ICT skills) or on-the-job learning (e.g. project management skills).
5. Laying Infrastructural Foundations . The specific e-government application may not be used, but projects often leave behind their ICT infrastructure (PCs, networks, operating systems). These can lay the foundation for later e-government projects.

We should be clear, though, that there are more efficient, more effective ways of generating most of these benefits. Most are just 'making the best of a bad job'.

Many e-government failures do not even generate these benefits. The key problem here is that - in most e-government project failures - there is no learning because knowledge about the failure is not captured, transferred or applied. As a result, mistakes are wastefully repeated. eGovernment project funders and project managers could approach things differently by adopting a learning approach to e-government failure.

A Learning Approach to eGovernment Failure

A learning approach to e-government failure involves four steps.

1. Recognition . Recognise that failures exist, and that they provide opportunities for generating knowledge.
2. Capture Knowledge . Find ways to capture the knowledge generated by the project. Ways of doing this include regular review meetings during the project; post-project evaluation meetings; and commissioning specific 'learning reports'. However, stakeholder motivation is critical. Those involved will ask themselves, "Why should I tell you that?". Unless there is a good answer, they will keep their knowledge to themselves and not allow it to be captured. You can find an evaluation tool for e-government projects here. You can find a more general guide to questions to ask in project "post-mortems" here. You can find a more general process approach to learning about ICT projects in developing countries here. This site provides a specific guide to understanding (i.e. capturing knowledge about) the causes of e-government project failure.
3. Transfer Knowledge . Find ways to move the knowledge from where it is captured to where it is needed. Ideas include: have project staff train others; hold informal 'lessons learned' meetings that mix staff from the failed project with others (e.g. an 'eGovernment Champions' group); create an email discussion list about e-government success and failure. Think of the transfer process as a 'knowledge market' with buyers and sellers of knowledge (the sellers being those who have learned from the e-government failure). Motivation will again be critical. Sellers must want to sell their knowledge, and buyers must want to buy that knowledge. Are suitable incentives in place to encourage buying and selling?
4. Apply Knowledge . This is hard to organise. Staff will apply knowledge if it is useful to them; and won't if it is not. Some governments build into new e-government project some ring-fenced time that is allocated solely to 'learning lessons from the past'.

But . Why Is Learning From eGovernment Failure So Rare?

Two reasons.

1. Because Stakeholders Don't Want To Learn.

Why don't they want to learn:

• Irrelevance of success/failure . For example, some stakeholders might only be interested in association with the high-profile inception of the e-gov project, not with the implementation and outcomes. Others might see the project as a means of directing investments to local IT firms, not as a means to achieve e-government goals. In these and similar cases, the outcome - whether the project succeeds or fails - is of no importance to the stakeholders, so they have no interest in trying to learn in order to do better next time.
• Fear of exposure . Some stakeholders fear that a learning process will expose their shortcomings: their ignorance about ICTs, their self-serving behaviours, their corruption, etc. They will thus resist a learning process.
• Cultural inappropriateness . In some organisational or national cultures, it is acceptable to admit and learn from failure. In others, it is not: failures are to be ignored or denied, and are certainly not to be discussed for the purposes of learning.
• Skewing of incentives . In some situations, there may be incentives for ongoing failure. For example, with some e-gov applications, "success" can mean that the public agency is downsized or loses financial resources because of its efficiency gains. By contrast, failure may mean maintenance of resource levels, or even continuing investment in renewed e-gov efforts. Likewise, vendors and consultants may see ongoing income from failures in a way they won't if an application succeeds. In these cases, stakeholders don't want to learn how not to fail; they want to continue failing. Alongside this may be a lack of incentives - such as audit, censure, litigation - that encourage learning from failure.
• Stakeholder absence . By the time an e-gov project ends, key stakeholders have often moved on to other jobs/projects and have no continuing interest in the original project.
• External ownership . Related to a number of the above causes, e-gov projects are sometimes driven from outside government and even from outside the country - e.g. by foreign donors or by foreign consultants or by multinational vendors - and are not owned by local stakeholders, who therefore feel disempowered or disinterested in any learning process.
• Environmental instability/uncertainty . A characteristic of developing/transitional countries is the relative instability of the social, economic, political environment. Such a situation reduces the value of, and incentives for, learning since often the 'goalposts will have moved' from one e-gov project to the next.

2. Because Learning Is Hard

Learning per se costs time and money - often a lot of time and money if it's to be done properly. Public services lack both those resources. eGov systems may cost more than most because they are so complex, involving so many stakeholders in a situation that is typically very politicised.

Thanks to all those who contributed their ideas to the discussion of costs and benefits of e-government failure.