Building future ready governments

From late 2019 until 2023, the COVID-19 pandemic was an extraordinary stress test for governments and economies around the world. It revealed strengths and weaknesses of organizational crisis response and resilience in ways that will be studied for years to come.

Through the innovation and investment spurred on by the pandemic, governments entered an era of growth in functional capabilities and organizational transformation. Accomplishments made by governments during the crisis were recognized and appreciated by many citizens.

At the same time, the pandemic also revealed gaps in emergency preparedness and challenges faced by government agencies working across civil society and jurisdictional boundaries. It pointed out the need for better capacities to anticipate risk, more systematic threat horizon scanning, better data management for monitoring public health indicators and other critical infrastructure metrics, and more expertise within governments to review data and support decision-making.

In the aftermath of the pandemic, many governments recognize that, despite progress made in key domain areas, they are not as prepared for the next round of future shocks as they would like to be. To find out what these leaders are doing to improve resilience and readiness, the IBM Institute for Business Value (IBM IBV) conducted a survey of global government leaders focusing on the actions and investments they made to improve resilience, as well as their mindsets and attitudes toward organizational transformation.

Higher performing governments demonstrated that transformation is possible for organizations, even during a global shock as massive as the pandemic.

Governments that committed to transformation outperformed peer organizations

During the survey period, the governments that made a stronger commitment to transformation improved their mission resilience at a much higher rate, with a 54% increase in readiness on average. Even as they responded to the emergency management demands of the pandemic, they were able to pivot from business-as-usual methods into a more agile mindset.

Despite weathering a global pandemic, governments dramatically increased their ability to deliver on their mission.
Distribution of mission capability/readiness rate from 2019 to 2023

Differentiators for resilience: Technology maturity, willingness to innovate, and strategic investment

While technology maturity played a large role in higher rates of performance, the willingness to embrace new technologies is also a strong indicator for success, along with a commitment to automation, cybersecurity, and sustainability. A relative lack of progress in these areas prevented some governments from keeping pace with peers on the technology front. This suggests that public sector organizations that experimented and embraced new technologies fared the best during the global pandemic.

The technology maturity demonstrated today by governments that transformed during the pandemic can also be traced back to the increased investments they made since the start of the pandemic. Higher performing government organizations increased investments in six new technologies, including AI, generative AI, cybersecurity services, cloud computing, automation, and analytics.

Reflecting a sense of urgency around building readiness, 60% of government CEOs put a high-priority focus on accelerating transformation and 69% recognize the need to rewrite their organizational playbook to be future ready.

Cybersecurity: A key enabler of digital transformation and indicator of mature capabilities

A closer look into cybersecurity reveals the key aspects are mature capabilities in zero trust, cloud security, and cyber risk quantification. The surveyed group of higher-performing governments entered the pandemic period with significantly higher levels of maturity than other groups in zero trust security architecture, cloud security, and cyber risk quantification. The level of maturity in these cybersecurity capabilities continues to be a significant indicator of transformation.

Higher performing governments set themselves up for success because they were more mature in cybersecurity at the onset of the COVID-19 pandemic—and continue to be more mature today.

The impact of organizational culture and empowering people 

Results from the survey indicate that government organizations that transformed at higher rates believe more strongly in empowering stakeholders and employees to exercise judgment, discretion, and imagination. These organizations are also more committed to training ecosystem partnerships—helping people build specific knowledge through training, education, and diverse experiences.

When compared against peers, higher performing organizations showed significant differences in how individuals are empowered in their organizations. for example, 61% of government leaders from organizations that transformed at higher rates said they empower individuals to exercise behaviors such as judgment, discretion, and imagination. And in terms of emphasizing agility in organizational processes, 63% of these leaders embrace this practice.

Progress is slowing down, just when it should be picking up

Despite widespread modernization efforts, transformation, and the successful response initiatives coming out of the pandemic era, the rate at which organizations are improving is decreasing. As the pandemic wound down, government organizations that led the way in transformation efforts reported a mission capability growth rate of only 4%, an 80% decrease from their previous rates of growth.

Lessons learned from the pandemic illustrate that initiatives as challenging as organizational transformation can still be deployed, even during a global shock. But another lesson learned may also serve as a warning—complacency can be a risky response to future shocks and could compromise efforts to creating a roadmap to resilience and preparing governments for these events.

Reflecting a sense of urgency around building readiness, 60% of government CEO respondents put a high-priority focus on accelerating transformation and 69% recognize the need to rewrite their organizational playbook to be future ready.

43% of government leaders say they’ll increase the tempo of their organization’s transformational change in 2024, compared to just 19% that expect to slow down.

 As climate change, natural disasters, supply chain disruptions, cyberattacks, and other crisis-level events happen more frequently—and deliver more destabilizing impacts on nations and citizens—local governments, regional bodies, and national government agencies must be more agile and forward-looking. Download the report for essential insights that can help government leaders take stock in where they are—and take action to build resilience.