Reshoring supply chains and other top government trends for 2022

The federal government is so big, it's hard to get your arms around it. But the Deloitte Center for Government Insights has given it a try. Its latest "governme...

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The federal government is so big, it’s hard to get your arms around it. But the Deloitte Center for Government Insights has given it a try. Its latest “government trends for 2022” observations are definitely worth reading.  Federal Drive with Tom Temin talked to Bill Eggers, the center’s executive director.

Interview transcript:

Bill Eggers: It’s great to be back with you again, Tom.

Tom Temin: And before we get into some of the observations that Deloitte has made here, just briefly, give us the methodology by which you arrive at what do you consider the top trends for the government?

Bill Eggers: Sure, and this is our third edition of our annual government trends report where we focus on what are the most transformative trends in government that we’re seeing all over the world. And it’s a kind of a massive research process that usually starts about nine, 10 months before the report comes out. And we crowdsource from colleagues all over the world, in terms of what are the big things that they’re seeing in their jurisdictions. And we also do interviews with dozens of different government officials. And this year, we teamed up with Apolitical, which is an organization of over 150,000, government officials from all over the world, a lot of senior government executives, and then we take all of that which often times will be over 100 different trends, and we consolidated into what we see as the 10 most transformative ones of the year. And this year, we grouped them under three themes, building resilience, where we’re focusing on long term resiliency to future shocks, connected for greater value, which really looks at the overhaul and integration of structures, systems, data sharing, to drive greater impact. And then lastly, government for all the people; making programs and services truly equitable and inclusive. So the trends are grouped into those three major categories.

Tom Temin: Alright, and would you say that looking at this, especially in the resilience area, that the pandemic has exerted, what you might call permanent gravitational force on the way governments operate and the way they think about things?

Bill Eggers: Oh, absolutely. And some of our two last trends reports really focused on that, which was all of the acceleration of everything digital, government and the use of AI and customer experience, and cloud, and so on. For government, of course, hybrid workplaces, and a lot of that being very permanent. So it really catapulted us into the future of government in a way that, you know, I’ve been doing this for over three decades, I hadn’t seen that sort of progress made so quickly any other time.

Tom Temin: And in some ways, the different buckets that you mentioned, are interrelated, because we had a lot of resilience in the way Congress and agencies could react over the couple of years of the pandemic. Sudden, new programs popping up for all sorts of things. But the connection for value may not quite have been in place for some of those given what we’re finding now about fraud, waste, abuse, improper spending, and the oversight of those in the U.S. government’s case, trillions of dollars.

Bill Eggers: Yeah, and I think that one of the big, broad themes we see across all these areas in the trends is this real big focus on public-private integration, and the fact that so much of what government does, right now, it does through partners, it does through NGOs, private companies, state and local governments, and so on and so forth. And that really rising in importance in terms of doing it well, and so much of COVID, of course, was that sort of integration and working across sectors. So that’s another theme that goes across all of the trends and major themes. And it really highlights the importance of government, really focusing on that as a core capability right now for senior government officials.

Tom Temin: All right, I wanted to delve into a few of the areas that look into well, they all look interesting, but a few that we can have time for today. One is reshoring. And friend shoring supply chains. Now, the government in the United States, and I guess this is the true of most normal, democratic type of open governments tend to source in country as much as possible to begin with. So tell us more about reshoring and friend shoring supply chains.

Bill Eggers: Yeah, and reshoring and friend shoring goes well beyond what government is purchasing. So looking at the overall supply chain in our country and other countries, and of course, we’ve all seen during COVID and then certainly now of these external shocks, which had created some real issues in terms of the supply chain. And so in response, governments are encouraging reshoring which is boosting domestic production capabilities, especially in really essential sectors, such as semiconductors through a mix of policies, incentives and orders, but reshoring, while popular, has a lot of limitations. Some supply chains simply can’t be fully reshored because the critical resources may exist globally in only one or two locations. And also the cost of replicating some of these supply chains domestically is likely to be larger than the entire global industry might be worth. An example is semiconductor manufacturing where of course there was a bill before Congress to invest in this. But establishing fully domestic semiconductor manufacturing supply chains in the US could cost up to a trillion dollars, which is more than double the value of the entire semiconductor market. So policymakers are increasingly looking to pair reshoring with friend shoring, which is a network of trusted suppliers from friendly countries that offer multiple independent supply pass. So friend shoring offers a clear path to improving both resilience of key industries while also supporting important international relationships with friendly countries like Australia, Canada, the UK and so on.

Tom Temin: Yeah, too bad. We can’t drag Taiwan, the whole island and move it in between New Zealand and Australia. But for the time being, that’s a good friend shoring supply. We’re speaking with Bill Eggers. He is the executive director of the Deloitte Center for Government Insights. And linked-up government because there is statutory again in the United States, and I imagine elsewhere, statutory mandates to link up government through the DATA Act and different laws to try to assimilate and make sense of all of the information the government has.

Bill Eggers: Well, you know, the notion of linked-up government, or sometimes called joined-up government, originally out of the Blair administration in the UK, is simply around trying to arrange agency structures around problems rather than simply departmental boundaries, and allows governments to better respond to complex societal challenges. And of course, as you mentioned, data sharing plays a crucial role in the silo hacking effort by becoming a really connected thread between agencies. And when you look at a lot of the daunting challenges our society is facing, from unemployment, to climate change, poverty, public health, homelessness, no single agency can address these alone. So the solution really does lie in collaborating across governmental departments and linking up through these joint efforts across multiple levels of government that have common missions and programs. And from a federal perspective, you know, a big example of this is the movement where around having more life event- based service delivery. Right now, which was part of the CX executive order and saying that there are certain life events that people have that require going through a lot of government hoops. And if you can link them up and make that much easier, you can really improve people’s lives, make them easier. And that’s everything from birth to early childhood development, to death, to starting a business, to retirement, and so on. So I see that as a really crucial thing, it’s really hard to do well across multiple levels of government that, but that’s what it requires. And we see that as one of the biggest trends right now in digital government is that focus on life events, which Singapore originally came up with that idea about 20 years ago, Tom, all the way back in the dotcom era. And we’re finally now seeing over the last few years, a lot of traction all over the world in that space.

Tom Temin: And that relates, in some sense to the ‘no wrong front door’ idea that is in the CX of the US government trend right now.

Bill Eggers: Yeah. And it goes even more saying when you have a death in the family, it’s very, very traumatic, obviously, but it can also take a lot of time to navigate through all the government agencies, and how do you do that in a way where that navigation becomes very easy. And you offer up that information once and it’s been shared to a lot of other government agencies. The UK, Singapore, and a number of countries have done a really good job of taking all of those different transactions and putting them into one life event.

Tom Temin: Sure, maybe someday we’ll have a digital death certificate that would make families lives a lot easier. And government is catalyst for innovation. We’ve seen this deeply in the defense sector, as a nation seeks to regain the strategic edge and so forth, but also an energy, and a lot of other domains that agencies are in to try to jumpstart these new areas, almost like back in the 1950s. A return to.

Bill Eggers: Well, I mean, if you think about some of our government’s greatest achievements over the decades, it’s been through playing this catalyst role rather than attempting to do all the heavy lifting on some. Think about DARPA and the internet. Think about GPS. Even going back, as you mentioned, the 1950s the emergence of the nuclear industry was heavily facilitated by the Department of Energy and a variety of funding things and regulatory things that they put in place. And what we’re seeing now is this notion of government serving as catalysts, assembling, and enabling multi-sector efforts to cope with the flood of COVID cases and create vaccines was a really good example of that. And so we’re seeing this movement for government playing a catalytic role in innovation move past simply Department of Defense, Department of Energy to many other areas. NASA is a great example of doing this. They have people who are focused on looking at some of the most important critical technologies that NASA needs and to what extent then NASA can catalyze and help the development of those technologies. And NASA also uses its procurements to help scale and sustain companies that can help them deliver on their mission through their SBIR, their small business innovation research program, and a number of other areas. So we see this government as a catalyst role being really, really important. It’s also important as more and more innovation happens in the private sector with so much even basic r&d now being done outside of government grants, that it’s increasingly important for government to be able to spin in innovation from the private sector, which is a big part of what the Defense Innovation Board, of course, is all about.

Tom Temin: Alright. And then the final one I wanted to ask you about is reimagining social care. Pretty soon it’s going to be a century of Social Security, if the solvency can hold up that long, and we’re just on the doorstep of that landmark and Deloitte is talking about reimagining social care as a major trend.

Bill Eggers: Yeah, we’ve put out several studies recently looking all over the world that some of the biggest developments we see right now around social care, the pandemic put enormous pressure on social care systems, from unemployment insurance to mental health. And it’s really compelled governments to re examine how they provide equitable, seamless and effective social care services. And so they’re looking at doing a variety of different things, embracing much more integrated care, holistic, all-in-one supports around this. We’re also seeing a big movement to eliminate what Cass Sunstein is called the “”sludge from government benefit programs where how do you take a 50-page food stamp application and reduce it down to a page? And how do you make it easier to apply for earned-income tax credit programs? Or what we’re seeing with the Medicaid program is they’ve used human-centered design to consider what are all the factors that keep members from renewing their benefits and thus losing their health coverage? And can we also use human-centered design to better understand in child support why some parents struggle to meet their support obligations and to create opportunities to help them but we see a real reimagining of social care bringing in a lot of these concepts of human-centered design and digital access that’s much more equitable, and trying to just reduce a lot of those barriers, both benefits and to independence.

Tom Temin: Bill Eggers as executive director of the Deloitte center for government insights. Thanks so much for joining me.

Bill Eggers: Thanks so much for having me here.

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