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How digitalization is impacting Labour/Employment

Administrations in EMEAChristian.Wernberg-Tougaard@oracle.com

Director, Social Welfare, Europe, Middle East & Africa

Global Public Sector Industry Business Unit

Presentation at Employment conference in Madrid, December 2, 2009

About me ...• Christian Wernberg-Tougaard

• Leads Social Welfare at Oracle Industry Business Unit on Public Sector, EMEA

• Nordic Public Sector Industry Lead

• Macro economist – Major in Labor Economics

• Worked with the impact of ICT on Public Sector for the last 14 years, including being:

• Senior expert for the Danish Government / Parliament on technology issues

• Expert for the European Commission (eInclusion Policy Support Program) and the European Parliament (RFID and Identity Management –ETAG and STOA).

• Different director roles in EMEA for IT-industry companies working with Business Development, Strategic Marketing, Innovation & Transformation. Worked as a Management consultant

• Head of Sector Danish Ministry of Science

• Chairman of The Danish Board for Greater IT-security

Agenda

• Political and economic challenges force transformation

• The current crisis and Labor Market

• Digitalization of Labor Market – best practise and things to

come ...

Transformation of Public Sector

TRANSFORMATIONPublic Sector

Industrial Age

Public Sector

Digitised Age

• Paperbased

• Rigid processes

• Stiff approval

system

• Difficult to

change processes

• Focus on

management, not

leadership

• Focus on ”when,

where, who”

rather than ”why,

how”

•Low

transparancy

•Multiple encoun-

ters of data loss

•Digital workflow

• Flexible

processes

• Adaptable

processes

• Self-service

• Easy extraction

of productivity

data

• High

transparacy to

processes and

privacy protection

• Value-focus

•Homogenous

and interoperable

•More demanding citizens

•Global Economic and Political Pressures

•Ageing population and shrinking workforce

•Escalating Social Services budgets

•Welfare, Social and political change

•Care for the Environment

•Migrating populations

•Security threats & Technology

•Moving from industrial to knowledge

society

Savings

Security

Service

111122223333

The Age Challenge: triple bad news

for Public Sector ... 3333

1• The most experienced employees are

leaving as they retire

2• There is not so many young people

wanting to join public sector

and the labour pool is decreasing

3• As the entire labour marked becomes tight

with scare resources, the salary gap

between public sector and private sector

will widen.

3½• And the increase of elders will challenge

the social systems, the pension systems

and the healthcare systems

Trends in Government Transformation

• Moved beyond system-to-system (S2S)

integration to ensure Country-2-Country

(C2C) integration and interoperability. Open

Standards and formats Worldwide.

• The Social Sector will grow rapidly – US

Bureau of Labor Statistics predicts a 22%

growth from 2006-16. Governments needs

to act transformational.

• Governments demands systems to be flexible and with high degree of COTS (Commercially Off The Shelf). Easy transformation of business processes and rule interpretation to accommodate best practises will be demanded.

• Governments wants to spend tax payers € efficient – solutions (HW+SW) and system intergrators (implementation/adaptation) must be highly mature (CMMI).

• Governments want to ensure that the citizens have trust in digital solutions – as distrust erodes the value creation of digitalization, hence privacy needs to be protected.

• By implementing best practise from Social

Service Industry Models, Governments will

yield better quality for less, knowledge

preservation and ability to shift resources

towards care taking.

• The citizens will appreciate the swifter

services and the reduced case-handling

time – especially if self-service capabilities

are implemented.

• Yield high degree of transparency of the

processes as citizens can see how rule

interpretation has affected their decisions, while

digital case handling yields significant gains in

productivity to the benefit of the government

and the citizen.

INTEROPERABILITY

FLEXIBILITY

MATURITY

PERSONAL INTEGRITY

GROWTH

EFIICIENCY

CITIZEN CENTRICITY

TRANSPARANCY

Agenda

• Political and economic challenges force transformation

• The current crisis and Labor Market

• Digitalization of Labor Market – best practise and things to

come ...

Why change Labor Marked policies ?

Sp

ain

: 19

.8

Call for long term actions

Call for short term actions

Labor Marked – recession actionsShort Run

Source Employment Working Paper No. 35, ILO 2009

Abbrivations:

PES = Public Employment Services

JSA = Job Search Assistance

LMP = Labor Marked Policies

Labor Market ecosystemStructural and transitional unempl.

Job portals, Labor Agencies Matching, peer networks, weak citizens job

Short Run

In e

mp

loym

en

t

Ou

t of e

mp

loym

en

t

Increased supply - Work Sharing

(”chômage partiel” – France)

Increased supply – Create new Jobs

Australia – ”Hire a fired” (subsidy)

Increased supply – TrainingSweden – 20% time cut unsubsidized

can be used for training

Training (Employability)

PES JSA programs

The S

ocia

l W

elfare

Infr

astr

uctu

re/E

cosyste

m

Unemployment Benefit Scheme

Reduce fear of Unempl.

Recent research has shown that a 3% increase in unemployment leads to:

2% drop in road kills

3% increase in suicides

21% increase in alcohol related deaths

Which on a family / social welfare holistic point of view can take 10-20-50 years to ”repare”

Social Benefits

Japan – Housing / Anti-Homeless

The Weak / Migrant Workers

Korea – 250.000 LowIC Jobs granted

Creation of Public Jobs, Wage

Subsidizes and lower Social Contribution

PES future considerations ...

• The traditional role of PES has been on making citizens

unemployed employed (able). Will this change? What about

securing skills and workability among ”endangered” workers in

case of crisis? How will this impact PES organisationally ?

• Should PES become more active in risk-assesments of citizens –

telling citizens that they should be upgrading their qualifications

as they are in a ”high-risk industry” ? And that kind of proactive

action towards the citizens – what would that demand from a

organisational point of view ?

• The choices done today in PS will remain active in PS for 10-15

years – what choices should be done today to prepare for the

labor marked of tomorrow?

Agenda

• Political and economic challenges force transformation

• The current crisis and Labor Market

• Digitalization of Labor Market – best practise and things to

come ...

So – how can digitilization help ?Citizen-centric

• Make systems that are easier for citizens to use

• Many citizens that are out-of-job has not been forced to use ICT in their job – they are novices on the ICT requirements... the eWeak!

• Make rules and regulations clear to citizens

• Most lay offs are not aware of the complex rules and regulations -> visualizations and guides as well as screening tools can be beneficial

• Increased turn-around-time – reduce vacancy time

• Using skill profiles together with advanced matching technology will reduce the ”in between job” waiting time and provide better citizen service

Short Run

Presentation

on

Siebel @ UWV

Presentation

on

OPA

Presentation

on

ELISE / WCC

So – how can digitilization help ?PES-centric

• Fight Fraud

• As many citizens can see increased utility from recieving benefit it might be tempting to claim more than you are eligible to. Rules engines and good metadata can protect you against this.

• Benchmarks

• To know how to go somewhere, you need to know where you are... remember to have good Business Intelligence

• Consolidate metadata and establish 360

• By having a value-chain based approach to PES digitilization (360 degree view) and securing information consolidation PES’s are able to provide much broader services to citizens more efficient.

Short Run

Presentation

on

OPA

Presentation

on

”Evolución del Modelon”

Presentation

on

CWI

So – how can digitilization help ?

• In the long run ...

• Prepare for the flexible future – the amount of policy changes that the recession has demonstrated will be ”everyday”

• Migrate LEGACY to COTS environments

• Use RULES and BUSINESS PROCESS ENGINES

• The biggest challenge of 2015 – to maintain Labor Supply sufficient

• New ways of working – collaborative and utilizing Web3.0

• Labor-Saving Technologies – Danish Government invest €500m in joint-venture research to examine / POC.

• Training, training and training of workforce to climb the value-chain (transition towards more and more knowledge-based economies)

• Interaction with people in work as well as unempl.

If you want to learn more ...