Why do big digital projects in the public sector fail? | Hacker News Reader

Why do big digital projects in the public sector fail?

newstatesman.com

8 pointsuser2018012013 comments

We gonna pretend that private sector projects aren’t failing all around us?

Here's a success story of a non-digital project: https://transportationops.org/case-studies/i-85-bridge-colla...

The reason it was successful is because the right incentives were in place for the people doing the work. Digital or not, the fundamentals are the same.

The public sector, in particular governments, have a long history of creating bad incentives or misaligning the incentives. The root causes of this are severalfold.

I'm not convinced "big digital projects" in the private sector fare any better. As far as I can see, the scale of the project is a bigger problem than whether the originator is a private or public company. Public companies just have more of an obligation to be transparent with their failures.

I've never seen a "big" digital project done by anyone but contractors. They fail because they have no skin in the game, and don't give a shit. The biggest contractors seem to be worst.

I never really understood this. I work for a small contracting shop, and we definitely give a shit, because our reputation is on the line. Without our excellent reputation we wouldn't keep getting work. How do the big contracting firms get away with it? It seems like everyone knows they're awful, except the people who give them billions of dollars.

I don't think this applies to Boeing or Oracle or IBM...

Kickbacks, that's why.

It’s because they are considered “big digital projects”. Any significant it change necessarily involves an even larger organizational change. Ignore that, and fail.

Actually in Brazil we have a few huge succesful ones. Pix for payments (like Venmo). Carteira Digital (digital drivers license, even better than the US), .Gov for notary document signing.. among others

it’s the same reason that large public sector construction projects fail, or maybe to put it a better way, eventually get built , way over budget, and immediately begin renovation.

Since not all of them fail, one should maybe look at those who don't and try to understand why.

The article mentions corruption (in softer words) and lack of expertise on the government side. But there is little talk about the quality of suppliers.

There are just three primary reasons why public sector digital projects fail, although you can break them out into a myriad of more detailed reasons/examples:

1. Competency Gap: Public sector organizations don't have the right people of the right quality as part of the organization with the right skill-set to not only do the project, but even to appropriately evaluate vendors. Entire books could be (and have been) written on this topic, but the competency gap is now so bad in the public sector that they're not even capable of hiring the right people, and therefore it is intractable for them to ever solve this problem.

2. Misaligned Organizational Incentives: Public sector acquisition rules disallow the public sector from forcing companies to take losses except under very narrow conditions, this type of cost-plus modeling, even on what would otherwise be a fixed-priced contract, incentivizes external entities to milk the government teat for all its worth rather than delivering on time and under budget.

3. Misaligned Personal Incentives: Public sector projects are inherently politic, and are rife with corruption and abuse. Going beyond the obvious, this also exacerbates point 1 above, because anyone involved in a public sector project that's not either naively selfless or an idiot will take a private sector job at a many times multiple of their public sector pay to do the exact same work on behalf of the selected vendor. In fact, the revolving door of public sector / private sector is a form of blatant but "legal" corruption that exists effectively globally without much comment from anyone.

If I was being pithy, the short answer is that at least in the US, and most of the West, Boomers broke the government to exploit it for their own personal greed, and by violating the social contract made it a toxic place for anyone who isn't similarly interested in the grift from being involved in.

Point 1 (which is specifically mentioned in the article as well) and point 3 seem to be rooted in the same issue:

The responsible public servants aren't competitively paid and vetted or that they lack expertise.

I'm sure governments can find expertise in universities, technological institutes etc.

Point 2 seems crazy to me.

Fixed priced contracts should specify exactly what the goals and requirements are. Obviously if more is asked down the line, then there's grounds for negotiation.

I don't understand how governments aren't allowed to operate on this basic principle like everyone else.

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