Delivering on the Digital Experiences that Drive Efficiency. How states rank in customer experience maturity and how and why they should get ahead

Transcription

1 Delivering on the Digital Experiences that Drive Efficiency How states rank in customer experience maturity and how and why they should get ahead

2 Executive Summary Are states delivering effective digital customer experiences? In May 2017, the Governing Institute examined three citizen and businessfacing services across the 50 states to assess areas relating to engagement and user experience. The Institute then developed a customer experience maturity model that identifies states that are leading, emerging or lagging when it comes to an effective digital experience. The research revealed widespread differences in each state s ability to deliver consistent digital services to citizens, prospective employees and businesses. Digital maturity correlates with higher customer satisfaction rates and becomes a competitive differentiator to attract new businesses. The results are important for state and local governments, especially for those behind in their digital development. Maturity correlates with higher customer satisfaction rates and becomes a competitive differentiator to attract new businesses. The benefits aren t only for constituents: Government can significantly reduce costs and improve internal operations as agencies become more digitally mature. This paper further highlights the research findings and offers insights from government experts to explain the specific advantages states with some of the most mature digital experiences are enjoying. It also discusses how emerging and lagging states can boost their digital prowess to reap similar rewards. 2

3 A Model Example: The State of Tennessee Tennessee sees the future of customer engagement and it s all online. That s the primary way we want to interact with citizens across all phases of government, says CIO Mark Bengel. 1 For the past two years, Bengel has marshaled resources to make that happen. Agency stakeholders are cataloging the various ways departments engage with citizens and identifying those that can be converted to online interactions. In parallel, a group within IT is creating citizen portals where people can log in to see an array of government services tailored to their individual profiles. Predictive analytics will then suggest relevant services someone who applies for unemployment might receive a pop-up screen recommending that he apply to the local community college program. To bring this digital reality to life, Bengel and his staff must first overcome one of the biggest challenges facing state and local governments: barriers that keep legacy systems from sharing information. Tennessee is addressing this with a variety of technologies, including a new data warehouse and an enterprise service bus (an architecture that sets rules and principles for integrating applications). Once the state achieves this scenario, a woman who moves to a new home, for example, could enter her new address in the online portal and her relevant records would immediately update across related government departments. Delivering this direct benefit to the citizen builds trust in government, reduces friction for the customer, and ultimately saves the state time and resources through operational efficiency. All the interrelationships among the various agencies will be taken care of in the background, Bengel says. Citizens won t have to understand how government works on the inside; they ll simply see everything as government services. Eventually, Tennessee will use a similar approach to unify data and deliver personalized digital services for its business constituents. Digital Government: More Dream than Reality? When Governing Institute analysts evaluated digital maturity across three experiences for all 50 states, they found: <20% of states offer two-factor authentication & personalization 18 states don t have any mature services States offering e-signatures: 9for taxation <20% of states have open data sets <10% of tax sites were mobileresponsive for business 28 registration 25 for employment 3

4 The Customer Experience Maturity Model Tennessee s drive for digital maturity is ambitious, but it is not unique. State and local governments have invested in online services for years. Despite that investment, our research shows they still are not achieving the most effective customer experiences and efficiencies. The research is helpful for states looking to improve their digital services for three reasons. First, it shows CIOs, digital architects and department leaders where to prioritize investments to improve customer experiences. Second, it spotlights missed opportunities. For example, friction around filing and paying taxes isn t just frustrating for citizens, it risks delays and revenue shortfalls at a time of intense budgetary pressures for government. Third, public officials can use the results as a barometer for how their state is doing, how they align with the governor s agenda and how to get ahead. The research charts a roadmap for maturity goals and applying best practices; accordingly, it will help accelerate the construction of better digital experiences for emerging and lagging organizations. To develop the maturity model and determine where customer experience reigns and where it s lacking, the Governing Institute evaluated three digital experiences based on how states addressed the following questions: Can new business registration be conducted online? How do customers find and apply for state employment online? Can customers pay their taxes online? 4

5 The Governing Institute then looked at the following customer experience indicators: Is the website customer-centric? Is the site compelling and useful, and does it provide timely information? Do the menus and search capabilities quickly lead to relevant information? State websites should be consolidated and customeroriented so they are easy to navigate. They should be designed on the back end to target and simplify the experience as much as possible across all government services. Outside of website design, states should also focus on content. To increase engagement and help educate the public, agencies often put more information on their websites, but redundant, nonsearchable content further fuels the decline in the customer experience and adds to the internal burden of content management. Instead, agencies should focus on making content easily digestible and quick to find. They can use various tools to aid the process. For instance, social sites, including Facebook, Twitter and LinkedIn, allow agency personnel to monitor customer sentiment and gain new insights into shifting customer needs to help prioritize the development of new services. In addition, personalization tools use persona, profile, geographic location and other information from previous visits to display the information most relevant to each visitor all while maintaining the privacy of individuals and businesses. Is it operationally efficient? Does the site have responsive or mobile-adapted forms that help reduce the costs of processing paper-based forms? Do the forms offer embedded guidance to help constituents accurately enter all the necessary information, and do they allow users to use digital signatures? To fully modernize, states must realize the benefits of end-to-end, secure digital workflows. This includes embracing e-signatures, which significantly reduce the time spent getting approvers to physically sign documents. Through analytics, governments can further achieve efficiencies by assessing customers online activities and capitalizing on the large volumes of information they routinely capture to identify broken processes and improve experiences. Does it have a mobile-first design? Through responsive design, websites should identify the types of devices visitors are using and respond by displaying information appropriate to the screen size and resolution. After constituents enter personal information in one engagement, the data should auto-fill any other services that require the same information. Save features enable people to interrupt forms processing without having to start from the beginning when they return. Analyzing the three experiences across all 50 states resulted in nearly 150 evaluations. In addition to identifying areas where each state excels or needs improvement, the evaluations enabled the Institute to rank and compare the level of customer experiences for individual states against their peers as follows: Lagging Emerging Mature 5

6 Know the Rules Governing E-Signatures Governing Institute research reveals a sobering lack of e-signature capabilities in many states. This represents a lost opportunity for states looking to improve efficiency and the constituent experience. But before states can implement this critical service, they must address some important considerations. First, they must understand the differences between electronic and digital signatures. The former is a broader category that uses a variety of electronic authentication methods to enable people to indicate acceptance of an agreement or record. Digital signatures use certificatebased digital IDs, typically issued by a certificate authority, to authenticate a signer s identity. They also use encryption to bind the certificate associated with each signature to the document. Second, government personnel should be familiar with two important regulations. The U.S. Electronic Signatures in Global and National Commerce (ESIGN) Act makes e-signatures legal across U.S. states and territories. In addition, all but three states have adopted the Uniform Electronic Transactions Act (UETA), which states that records or signatures can t be denied legal effect or enforceability simply because they re in electronic form. Nonetheless, some exceptions apply: UETA doesn t cover birth, wedding or death certificates, for example. The three states that haven t adopted UETA Illinois, New York and Washington have implemented their own e-signature regulations. To meet their unique needs and requirements, government officials must be clear on which laws are binding in their states and then choose solutions that make it easy to support the relevant rules. Only two states Tennessee and Utah demonstrated digital maturity in all three categories. Governing Institute research found that delivering a winning digital customer experience is more dream than reality for most state and local governments. In fact, only two states Tennessee and Utah demonstrated maturity in all three categories. Most states showed a mix of emerging to mature characteristics in the evaluated experiences. While 32 states were mature in at least one category, 18 others didn t have any strong trends toward digitally mature services. Gaps include outdated website designs that make it tedious, or impossible, for constituents to quickly find specific information. For example, one state with a large rural population listed regulations for septic systems under the label of underground waste receptacles. Realizing this is a term only an engineer may love or understand officials eventually revised the site to be easier to use. Fewer than 20 percent of states offer two-factor authentication and digital personalization. And e-signatures have yet to become standard in government only 9 states offer them for taxation, 28 for business registration and 25 for employment. A closer look at the three experiences shows where states need to focus their digital modernization efforts to avoid these risks and better serve constituents. 6

7 A Closer Look: Registering a New Business Online A key policy directive for many governors is making it easier to do business within their state. This boosts economic development and increases competitiveness, while streamlining internal operations. Agencies receive fewer phone calls and in-person queries from business owners struggling with the registration process. Registering a New Business Overview Some IT officials are already acting on this directive. Overall, business registration forms are easy to use, and 80 percent of the states offer guided submission processes. Many business registration sites have engaging forms; color schemes and branding are also most present in this experience. Mature states store profiles to manage several business services, including those for owners with multiple businesses. In addition, forms and websites for these states are often mobileenabled and responsive. Nineteen states achieved mature status. However, many of the others lack profile and save features: Only 27 states offer the option to create a user profile, while fewer than half (21 states) support save features. Another gap was in the large number of business registration sites that aren t mobile-enabled (28) or responsive to screen size (31). Today s mobile employees expect these features. 7 states lagging 19 states emerging 19 states mature 5 states not rated* *Five states were not rated because of website problems/other issues. What s more, lagging states still use paper and require business owners to mail in registration forms. Outdated processes for personal taxes and fees and legacy business filing resources keep states from efficiently collecting all the revenues they re due and prevent organizations from gathering valuable data that can inform business development campaigns to attract new companies. How States Were Ranked for Registering a New Business Online Mature Profiles manage several business experiences Submission processes are clear and guided E-signatures are available for more efficient registration Forms are mobile-enabled and responsive Emerging Submission processes are clear and guided Many business registration processes lack profile or save capabilities Processes with profile or save tools offer limited responsiveness Lagging Paper, mail-in forms are prevalent Online experiences aren t guided Save or profile features are not available 7

8 A Closer Look: Applying for Employment Online The Governing Institute assessed each state s employment application processes. This experience showed the highest overall levels of digital maturity out of the three evaluation categories. Eighty percent of states offer guides to enhance application success, and generally, the online forms are easy to find and use. Automated employment processes also had the highest frequency of enabling citizens to input and save their profile information, which relieves them from reentering information multiple times. And employment application experiences were the most likely to be mobileenabled and responsive. The most mature states offered advanced features such as e-signatures that allowed applicants to file online rather than printing out and mailing in forms. However, there s still room for improvement. For example, 17 of the higher-performing states rely on a third-party service provider for application processing. Outside services can jump-start digital delivery, but there are opportunity costs. Because states aren t directly capturing important Applying for Employment Overview 6 states lagging 20 states emerging 21 states mature 3 states not rated* *Three states were not rated because of website problems/other issues. information about job seekers, they re unable to analyze data that could help personalize and target communications to key demographic groups. These states are also missing opportunities for increased revenues, since third-party service providers profit from citizens online transactions. How States Were Ranked for Applying for Employment Online Mature Process is generally guided Most application processes offer e-signature capabilities Applicants can enter and save their profile information Websites respond to screen sizes and mobile devices Emerging Static websites are prevalent with some engaging forms Branding and themes consistent on websites, but not on forms Profile and save features are available, but auto-fill is limited Lagging Forms must be mailed in Forms are difficult to find or use Color schemes are unattractive or missing entirely 8

9 States also lacked other capabilities in this experience. There was little branding or distinctive color schemes, and security methods were unclear. Providing intuitive, logical design elements and government branding reassures applicants they re visiting an official website and that their personal information is safe. States can also increase security and privacy by using two-factor authentication, but fewer than 20 percent of them currently do so. In addition, the evaluation revealed that personalized digital citizen experiences were slightly more common when searching for employment, but these too were rare. Positive digital employment experiences will become even more important in the years ahead as governments grapple with a wave of retirements and face intense competition to attract and retain qualified applicants. A 2016 report on workforce trends found that 54 percent of state and local governments saw retirements rise in In addition, the report said governments are struggling to find skilled workers for a variety of roles, including finance, IT, skilled trades and public safety. 2 Efficient online processes expand applicant pools and increase the odds of attracting digitally savvy, highly skilled talent. A wider applicant pool also furthers policy goals for states seeking a more diverse workforce. And just as important, online processes streamline hiring in ways that help reduce the cost and time associated with recruitment and hiring. The ROI of Effective Digital Experiences States have opportunities to realize a clear return on their investments in a variety of ways. Moving from paperbased to electronic forms is one example. Paper forms and the underlying processes and manual, error-prone workflows that support them are plagued by unnecessary costs. Research by IDC found 37 percent of business leaders say they struggle with manual processes that result in missing signatures, initials and dates. Sometimes these documents are also signed by the wrong person. 3 What s more, nearly half (46%) aren t sure they have copies of all signed agreements, and just over half (51%) say they have problems with misfiled or lost documents. Electronic forms can significantly reduce these expenditures. Built-in intelligence reduces the chance that forms will be submitted with erroneous or missing information, while automatic workflow tools quickly route documents where they need to go. E-signatures enable multiple signatories to simultaneously grant approvals, eliminating time-consuming sequential sign-offs. The reduction in errors and manual updates, improvements in workflows and decrease in paper costs may save nearly $600,000 a year for states that process 20,000 forms annually. 4 Organizations may see other benefits. In one study, 23 percent of executives said improving document processes could reduce compliance risk, while nearly three-quarters felt improving document processes would increase customer satisfaction. 5 Efficient online processes expand applicant pools and increase the odds of attracting digitally savvy, highly skilled talent. 9

10 A Closer Look: Paying Taxes Online The online tax filing and collection experience ranked as the lowest-performing of the areas evaluated, with only three states earning a mature rating. Tax code complexities, security concerns and legacy infrastructure limitations are some of the underlying causes. Paying Taxes Overview Only nine states offer e-signatures, a sign that most states still require customers to download forms from websites and mail in signed copies. Even more surprising is that applicants can t save or create a profile in 61 percent of states, which can cause them to rush through the process and rekey information. In addition, half of the states don t support mobile engagements. And because lagging states often rely on third-party payment processors, customers must scroll through menus on government and partner sites to find tax forms. Using payment processors keeps tax collectors from accessing a wealth of valuable data, including accurate in-house records about people who underpay or skip their legal requirements, which unnecessarily reduces receipts. Other incentives exist to move states forward on the maturity continuum. Online processing enables states to use algorithms that spot input errors as customers fill in tax information, which enhances compliance. For example, the state of Maryland used sophisticated analytics to spot $35 million in tax refund fraud in Similarly, automated workflow systems can process electronic forms more quickly than hard copy files and do so with fewer mistakes. 5 states lagging 30 states emerging 3 states mature 12 states not rated* *Twelve states were not rated because of website problems, requirements to enter personal information or other issues. Mature states offer a compelling model for emerging and lagging organizations to follow. The three leaders offer end-to-end online experiences that guide taxpayers with easy-to-follow instructions. The electronic forms are intuitive, and they pre-fill secure saved information. The websites are partially mobile-enabled. But even these states could improve by making all tax forms mobileenabled and continuing to use data and analytics to make processes more effective. How States Were Ranked for Paying Taxes Online Mature End-to-end processes are guided Responsive forms include auto-fill Websites are mobile-enabled Emerging Websites have limited or no color schemes Taxpayers can submit forms without e-signatures There is limited profile and save support Lagging Forms are paper-based and static Forms are generic and lack color and logos Websites emphasize online, third-party services 10

11 How San Francisco Bridged Its Digital Maturity Gap States aren t the only government entities reaping the rewards of digital maturity. Counties, cities and towns are also recognizing the benefits that come with better constituent engagement, and they re developing modernization best practices that are smoothing the way for others. One of the most mature digital pioneers is the Office of the Treasurer and Tax Collector for the city and county of San Francisco. Eight years ago, the recession spurred the agency to cut costs through internal efficiencies. It started by moving from paper to online forms for customers to register new businesses and file taxes. Since then, a variety of on-premises and cloud technologies have added guided electronic forms, automated workflow systems, e-signatures and online payment processing services with engaging user interfaces that make it easy for businesses to interact with the agency. Today, 99 percent of our tax filings are handled automatically, says Tajel Shah, the agency s deputy director. That helps us efficiently handle a growing volume of filings, so we can recognize revenue more quickly than in the past. 7 The office also reduced payroll expenses because fewer people can handle the small number of exceptions that now occur. Shah highlights four lessons she learned for achieving these results. 1 3 Understand the impact that improved user experience will have on internal staff. Better customer engagement may create a spike in processing volumes. This will be difficult for employees to manage without electronic business process engines and related updates. Tame legacy systems with middleware. Shah s agency manages seven legacy tax systems, including a mainframe platform. To modernize with minimum disruption, internal IT staff worked with outside vendors to develop new middleware. This enabled us to layer modern capabilities onto the existing systems without having to replace what was already there, Shah says. 2 4 Prepare for pent-up demand. From the start, the agency was mindful that any processing changes it introduced must accommodate a wide range of constituents. At first, we transitioned slowly from paper to online tax filings, Shah says. But we quickly realized that technically we could move faster than we originally thought, and that most businesses were ready for change. In retrospect, we didn t need that initial toe-in-the-water approach. Learn from early successes. Rather than launching new processes for the full gamut of business taxes, Shah and her staff focused on one area: the hotel industry and its unique tax requirements. We first figured out how to use the middleware to process hotel data using online forms and the mainframe, she says. We then built on what we learned by gradually expanding the middleware to pull data from each of the other tax systems. 11

12 Steps for Moving Up the Customer Experience Maturity Scale Governing Institute research shows how some states are improving their customer experiences, but what initial steps can others take to improve their digital services and better serve citizens and businesses? 1 Shift to automated and responsive forms and signature processes. A good first step for states is to end their reliance on paper-based forms for all but exceptional cases, such as the shrinking percentage of constituents who can t or won t engage with government via online services. Implementing responsive and adaptive electric forms requires a mind shift that envisions end-to-end processes that include submitting an employment application, filing tax information or registering a new business. This will create a win for constituents and agencies alike. Customers and businesses will enjoy personalized experiences that quickly lead them to the information they need and relevant services they may not have yet considered. At the same time, states will reduce costs associated with printing, storing and manually processing paper Paperless workflow capabilities and e-signatures allow the state of Hawaii to reduce paper use by up to 41,000 pages per day in just one of its statewide departments. forms. For example, cloud-delivered, paperless workflow capabilities and e-signatures allow the state of Hawaii to be more responsive to customers because departments can better manage paper trails and speed document approvals. By improving digital experiences in this one area, the state can reduce paper use by up to 41,000 pages per day in just one of its statewide departments. Since the state launched its e-signature pilot in October 2015, it has processed more than 150,000 unique electronic transactions. [We re] changing processes and not just technology, says CIO Todd Nacapuy. Our approach augments the departments internal IT resources that must work closely with critical subject matter expertise, which in most cases only the departments can provide. 8 Hawaii s e-signature capabilities integrate with third-party document management applications used by state agencies, which further enables employees to send and track files. Accelerated signing dramatically reduces the time that employees spend on paperwork. For instance, newly hired government employees once spent two hours filling out onboarding paperwork on their first day. Thanks to online forms, this step in the onboarding process takes only 20 minutes, Nacapuy says. When states design and develop new services with things like e-signature regulations in mind, they reap the full rewards of electronic workflows. This enables quick and sustained wins that can justify ongoing investments in modernization. 12

13 2 Be a customer-centric government. Tennessee s initiative highlights that digital experiences built around the customer, whether a citizen, resident or employee, are important to achieve maturity. Agencies need to think like their customers by adopting a customer-centric approach. To improve how government delivers customer service, it is important to understand what moments matter for customers, their experience with the services, and how experiences are perceived and remembered. Part of this begins with a mobile-first strategy that serves the growing demands of customers who seek anytime, anywhere access to services via ubiquitous smartphones and tablets. At all times, a customer-first culture keeps people as the primary focus of interactions. It s a strategy Tennessee takes to heart. Our website is going through a series of iterations in a continuing improvement process, says Dasa Martin, director of portal solutions innovation. We make changes based on the feedback we receive from customers, businesses and internal employees, and in the process our services are becoming more intuitive and easy to navigate. 3 Prioritize personalization. Personalization allows states to gather accurate customer and transactional data that s readily accessible to analytics programs. This shows officials how many people are searching for a topic, which in turn points to bottlenecks in internal processes and where states can best invest additional resources. For example, if few customers access a certain set of forms, these digital assets should be a low priority in updating efforts. To better tailor constituent experiences, consider website testing and personalization applications that are used widely by marketers in commercial industry. These tools enable states to compare test versions of website designs and communications to determine what resonates with a target group of constituents. Personalization algorithms, artificial intelligence and machine learning capabilities in the best of these programs reveal important insights that promote closer engagement and more successful experiences. Leading programs also enforce organizational and regulatory rules for maintaining privacy, such as anonymizing data as it s collected. Once personalization detects the interests and devices of key constituent segments, agencies can send targeted messaging, such as alerts about upcoming festivals and cultural events or notices about street closures all without the need to hire and train additional web developers or content designers. 4 Improve analytical capabilities and the integration of cross-departmental data. All departments will benefit when we share information, and in turn that could better the lives of individual citizens, says Ron Grove, Tennessee s executive director of enterprise shared services. For example, officials will assess the economic impact of a development grant applied to a certain region to determine if the money helped spawn new jobs or fueled a population increase. Other information might give officials a clearer picture of health trends, such as the rates of obesity and diabetes in different areas of the state. 13

14 The Future is Now Customer engagement, customer user experience and business user experience are crucial areas for modern government. As Governing Institute research shows, states that demonstrate maturity in these areas can benefit from higher constituent satisfaction rates, more efficient revenue collections and reduced costs. States that demonstrate maturity in the analyzed areas can benefit from: Going forward, frictionless online processes will be a selling point for states as competition heats up for new generations of skilled talent. These near-term and ongoing paybacks give government officials the ROI data they need to build strong business cases that encourage legislators and senior executives to approve new investments in digital modernization. The Governing Institute found a number of states are reaping the rewards that come with digital maturity. They re now poised to build on this foundation to further improve customer experience, streamline internal processes and distinguish themselves from emerging and lagging organizations. Fortunately, new best practices and technologies for electronic workflows and customer experience enable less mature states to quickly achieve parity in the race for digital maturity. Now is the time to act. Higher constituent satisfaction rates More efficient revenue collections Reduced costs Endnotes 1. All information and quotes from interview with Mark Bengel, Dasa Martin and Ron Grove conducted on April 12, Ibid. 5. Ibid All information and quotes from interview with Tajel Shah conducted on April 17, All information and quotes from Todd Nacapuy submitted via an interview on April 18,

15 This piece was developed and written by the Governing Institute Content Studio, with information and input from Adobe. Produced by: The Governing Institute advances better government by focusing on improved outcomes through research, decision support and executive education to help publicsector leaders govern more effectively. With an emphasis on state and local government performance, innovation, leadership and citizen engagement, the Institute oversees Governing s research efforts, the Governing Public Official of the Year Program, and a wide range of events to further advance the goals of good governance. Sponsored by: Adobe s trusted and proven enterprise solutions enable next-generation digital government. We help government agencies modernize service delivery while reducing cost to serve and processing time, all while delivering remarkable digital experiences e.republic. All rights reserved. Adobe and the Adobe logo are either registered trademarks or trademarks of Adobe Systems Incorporated in the United States and/or other countries. 15