E/ESCAP/STAT.10/10
23 September 1996
ORIGINAL: ENGLISH

ECONOMIC AND SOCIAL COMMISSION FOR ASIA AND THE PACIFIC Committee on Statistics
Tenth session
25-29 November 1996
Bangkok

A. Introduction

1. At its ninth session, the Committee on Statistics discussed some trends in information technology (IT) and their implications for the development of information systems in the public sector. The past two years have provided further evidence that computer processors and mass storage devices continue to improve with phenomenal speed, doubling their performance every 18 months. Another trend, personal computers being networked within and between organizations and those networks being connected to the Internet, has become much stronger in the region. The benefits to be gained from computerization and networking of information systems are manifold: public services would improve; surplus labour could be transferred from the government sector, increasing efficiency; and indirect benefits would be achieved through improved education levels and through private sector participation. Although some countries in the ESCAP region have made phenomenal progress in developing their national information infrastructure, in most countries computerization development in the public sector has been more sluggish than the availability and the affordability of information technology would suggest. This note by the secretariat seeks to analyse the reasons why governments are unable to improve and obtain full benefit from their information systems. It also reviews the recent progress of the secretariat activities in public sector computerization.

B. Economics of information technology

2. If the benefits of computerization really are so obvious and computing more affordable than ever, why is the computerization of information management still difficult for many Governments? This paper examines whether economic factors might offer any explanation for the paradox.

3. The cost/benefit curve for technology investments is often presented as a step function, where particular levels of investment, say the introduction of electronic mail, can produce superb value for the organization. The management needs to identify such development areas and potential ventures, and decide to invest in those that offer the best benefits for the organization. The introduction of some technologies, such as word processors and spreadsheets, not only improves staff productivity but also lowers the level of stress in the office and increases the job satisfaction of the users. The increase in individual productivity and better working conditions may not immediately show up in the profitability of the organization as a whole, but will benefit the future of the organization.

4. Successful development of information systems usually creates new expectations and new demand for add-ins and other applications. Eventually, there will be a demand for enterprise-wide solutions for data storage, administrative and transaction systems, communications etc. Being able to buy higher performing equipment for less money does not necessarily mean that the overall costs of information technology will fall. New pieces of hardware need to be installed and configured, staff must be trained to use new software, and time and money are required for their maintenance. Smart IT investment strategies aim at reducing the future costs rather than concentrating on the management or minimization of the current expenditure.

5. The time of replacement of IT equipment is not usually defined by the degree of physical wear to the equipment or software, but by their useful financial life. A computer, for instance, may become unsuitable for at least three reasons: it is not able to run a new application which the organization needs; its maintenance becomes uneconomic; or it no longer meets the performance standards of the organization concerning interface, portability, processing power and other criteria. If an organization is grossly undersupplied with computers, life cycles of hardware and software tend to become longer. If IT performance is measured solely by the number count of equipment, a seemingly satisfactory situation (for example, a 1:1 computer/person ratio) may prevent early adoption of beneficial technological innovations.

6. External factors are significant in determining the initial acquisition and the life cycle of information technology. Public sector organizations may be forced to invest in new information technology as their clients start demanding better and faster services. A signal to invest in information technology may come also in the form of competition from private sector service providers or other public sector organizations. Without competition push or client demand, and even where there are no funding constraints, many public sector service providers unfortunately do not feel that they should modernize their information systems. However, a competitive environment in the public sector is becoming a reality in many countries, not least because physical distance can be overcome through electronic transmissions. Therefore, a technological "push" is increasingly coming also from within the public sector itself, such as from sister offices in other districts.

7. Making comparisons between one's own organization and acknowledged good performers in the use of information technology is useful. Typical hard figures used are: information technology budget or expenditure as a percentage of total budget/expenditure; management information system staff as a percentage of total staff; and ratio of hardware expenditure to personnel costs. These figures can only be indicative of IT performance as each organization has its own characteristics. Such analysis requires some understanding of the organization, its structure, goals and objectives, and it is best done within a homogeneous group of organizations.

8. Without a set of standard guidelines and well-defined IT policies, an organization is unlikely to be able to use information technology in an optimal way. In the early stages of computerization, a likely result is lost opportunities for the organization. There is some empirical evidence in the United States of America and Europe pointing in the other direction, that is, that an organization can overinvest in information technology, but that kind of situation is no doubt rare in developing countries.

C. Non-economic factors

9. Information gives power to its holder, especially if other people do not hold the same information in the organization. The holders of information may therefore perceive the computerization of information systems, which could make the physical sharing of information simple and effortless, as a threat to their status. These views may be held even at the top level of an organization, which is one reason why an organizational commitment to develop information systems is one of the most important success factors in computerization. It must also be recognized that computerization of information systems may sometimes be considered undesirable because it means an increase in the transparency of administration and makes the control of personal accountability easier.

10. Another factor that might prevent rational computerization is an excessive fear of job losses in the public sector. This is one reason why large-scale computerization initiatives are not always enthusiastically received by labour unions and political decision-makers. While well-designed computerization initiatives do tend to cut down routine tasks, they also create new jobs elsewhere in the civil service and in the private sector. Indirectly, they also have a positive impact on education levels at local and national levels. During the past few years, low-cost but technologically skilled labour markets, particularly in India and Eastern Europe, have benefited from job migration from developed countries. That job migration has been two-tiered: it has involved many high-skill creative jobs in software design, but also low-skill white collar jobs in data entry and other computer routines, with the completed work being shipped back electronically to the distant employer. The globalization of labour markets through teleworking can moderate wage demands in IT sectors of developed economies.

11. As global networking allows borderless exchange of textual, graphical and multimedia information, fears about wired threats to national security, national cultures and moral values have emerged in practically every country. No country in the world has been able to update its legislation to correspond to all requirements of the new borderless information society. Many individuals in the global Internet community are proponents of totally uncontrolled information flows, whereas perhaps the majority of legislators and politicians feel that certain controls are necessary. In the Asian and Pacific region, some countries have adopted policies that require Internet providers to disable the access of their subscribers to undesirable foreign sites. Before jumping onto the global information bandwagon, many other countries keep assessing the need to control the impact that an abrupt liberalization of information flows would have on society.

12. The very rapid pace of IT development itself has played a part in hampering its progress in the public sector. It is easy to resort to haphazard use of basic information technology, rather than systematically monitoring innovations and their use in the surrounding competitive environment. The ESCAP secretariat has attempted to follow the technological developments, to improve its knowledge about information systems, and to upgrade them within budgetary limitations. The field of information technology is, however, very large and a proper monitoring of its development would require more resources than are currently available. The situation in most public sector organizations is very similar, as verified by the Expert Group Meeting to Review Computerization Development in the Public Sector, held in December 1995.

D. Strategic information technology choices for Governments

13. The total value of information technology is greater than the sum of its parts. This holds true particularly for the whole government sector, but also for individual public sector organizations. Individual organizations, while keeping their own informational and transactional systems, can achieve substantial gains through interagency cooperation in building an integrated information infrastructure together. Administrative records of one authority can be used elsewhere in the public sector. Information flows between various agencies could be partially automated and the distribution of certain electronic documents and other materials could be centralized.

14. Governments need to establish strategies for the coordinated and efficient use of public IT resources. Recommendations and some enforcement of interagency cooperation in sharing information and development efforts can provide substantial gains for the government sector. Some countries in the region have moved to establish centralized agencies to coordinate the use of information technology in the public sector. Singapore envisioned its IT2000 masterplan to develop the Republic into an intelligent island as early as 1992, well before similar national information infrastructure initiatives in the United States and the European Union. It established a high-level national IT committee to oversee the implementation of the public sector computerization programme, which is undertaken in collaboration with the private sector. The Government is advised on IT policy and strategy issues by the National Computer Board. The Board also plans and implements a large civil service computerization programme, promotes the use of the Internet in the public sector and procures hardware and software for the whole civil service. Moreover, its Data Centre runs mainframe operations for several government departments. The majority of the 1,400-strong professional staff of the National Computer Board are deployed to information systems sections of various government departments. To take another example, Australia recently established an Office of Government Information Technology, which is responsible for implementing and promoting a more proactive and client-focused approach for improving the use and management of information technology and telecommunications services across the country. The Office is headed by a high-level civil servant, the Chief Government Information Officer, who is supported by the Government Information Services Policy Board and many advisory and consultative groups in various IT domains. Country papers prepared for the Committee session will no doubt include more examples of similar national initiatives in other countries.

15. Technologically speaking, developing countries are in a position to leapfrog in information technology development, and examples from some countries show that this is possible. Leapfrogging nonetheless requires that the political decision makers are aware of the benefits that information technology can offer to their country. Senior-level managers and politicians are in a key position to initiate large-scale IT developments; they have the power to make necessary financial commitments and organizational and procedural changes that are inevitable. They must understand what their Governments and their organizations could achieve with the new technology; they must also understand how that change could be made to happen. In dynamic organizations, technological initiatives emanate also from the bottom up, but this is probably not very common in technologically less advanced countries in the region for reasons that are educational, cultural and organizational.

16. At its ninth session, the Committee on Statistics recognized that Governments have a role in creating a favourable atmosphere for the adoption of IT, inter alia through appropriate trade and tariff policies, legislative measures, incentive programmes for domestic applications development, support for research, adoption of international IT standards, promotion of appropriate new information technologies in both the public and the private sectors through various measures, and through human resource development in educational institutions and government offices.

E. Strategies and practices for individual public sector organizations

17. Individual public sector organizations would benefit from goal setting for IT development and strategic plans to achieve them. Computerization of a public sector organization may eventually be a more difficult process than in a private sector company as more people are likely to be involved in the goal setting and strategy formulation compromises. Through appropriate IT strategies, public sector organizations can create and provide better services for their clients. The immediate target should be to facilitate full utilization of local organization-held information for purposes that help the staff in their work to service the clients. It is likely that the organizations that achieve a balanced status between organizational and technological means will have a higher performance than others which have paid no attention at all, or which have paid too much attention, to technological innovations.

18. Information technology should be used to advance organizational goals, which underlines that the top management must understand technological issues and terms, and the role of information technology in the organization. The chief executives should learn the fundamentals of information technology and should be able to talk to their chief information officer in the same way as to their finance or personnel managers. Technology experts for their part should keep the core business, serving the public, at the forefront of their work and not make the information technology and the usage of its jargon a goal by itself.

19. Depending on the policy of the Government, information systems can be developed by the host organization alone, in cooperation with other government agencies, or they can be contracted from the private sector. Outsourcing of parts of public sector information management to the private sector is also being tested, particularly in technologically advanced countries. After management has decided to create an information system, it should remain committed to developing the system and being continuously involved in the development process through a capable management team, which has the authority to approve, cancel or delay the project. New information systems may require changes in the organizational structure, information policies and management practices. Organizationally, information system development can be broken down into internal projects and modules, which are easier to manage than projects that have too distant goals and that may suffer from a lack of ownership and commitment by the organization. Although the completion of projects on time and within budget is a very important measure of success, adjustments in delivery schedules are quite common because of unanticipated obstacles during the development process.

20. Some primary considerations must be taken into account in screening a proposed development project. First, as stated above, all projects should support mission priorities outlined in the organization's strategic plan. Second, a series of questions must be asked. Are there commercial off-the-shelf packages available to achieve most of the project's goals? Are there similar applications elsewhere in the civil service and can they be used to meet the project requirements? How does the project fit into the agency's technology and information architecture? Next, the capacity of the agency to design and execute the planned project must be considered. Lessons learned in other government agencies that have implemented similar projects should be incorporated into the project plan. Consideration should also be given to job rotation within and between agencies, which is one way to utilize accumulated expertise in the public sector and bring in new ideas to the organization. Only after these points have been considered can the technical design of the project be detailed.

F. Internet connectivity and regional cooperation

21. National networking initiatives have emerged in almost every country in the region, but still many members and associate members remain isolated from the global information networks in the sense that they do not have a permanent connection to the Internet or other global networks.Table 1 provides a list of members and associate members and their connectivity to international networks, from information available to the secretariat at the time of writing. In spite of the existence of connections, the access of citizens and public sector organizations remains very limited in the majority of listed developing economies.

Table 1. International connectivity of members and associate members

ISO 3166 code	Country or area	Full Internet connection	Bitnet access	Only e-mail
AF	Afghanistan	-	-	-
AS	American Samoa	-	-	-
AM	Armenia	X	-	-
AU	Australia	X	-	-
AZ	Azerbaijan	X	X	-
BD	Bangladesh	-	-	X
BT	Bhutan	-	-	-
BN	Brunei Darussalam	X	-	-
KH	Cambodia	-	-	X
CN	China	X	-	-
CK	Cook Islands	-	-	X
KP	Democratic People's Republic of Korea	-	-	P
FJ	Fiji	X	-	-
PF	French Polynesia	X	-	-
GU	Guam	X	-	-
HK	Hong Kong	X	X	-
IN	India	X	X	-
ID	Indonesia	X	-	-
IR	Islamic Republic of Iran	X	X	-
JP	Japan	X	X	-
KZ	Kazakstan	X	-	-
KI	Kiribati	-	-	-
KG	Kyrgyzstan	X	-	-
LA	Lao People's Democratic Republic	-	-	X
MO	Macau	X	-	-
MY	Malaysia	X	X	-
MV	Maldives	-	-	-
MH	Marshall Islands	-	-	-
FM	Micronesia, Federated States of	-	-	-
MN	Mongolia	X	-	-
MM	Myanmar	-	-	-
NR	Nauru	-	-	-
NP	Nepal	X	-	-
NC	New Caledonia	X	-	-
NZ	New Zealand	X	-	-
NU	Niue	-	-	-
MP	Northern Mariana Islands	-	-	-
PK	Pakistan	X	-	-
PW	Palau	-	-	-
PG	Papua New Guinea	-	-	X
PH	Philippines	X	-	-
KR	Republic of Korea	X	X	-
RU	Russian Federation	X	X	-
WS	Samoa	-	-	-
SG	Singapore	X	X	-
SB	Solomon Islands	X	-	-
LK	Sri Lanka	X	-	-
TJ	Tajikistan	-	-	X
TH	Thailand	X	-	-
TO	Tonga	-	-	-
TR	Turkey	X	X	-
TM	Turkmenistan	-	-	X
TV	Tuvalu	-	-	-
UZ	Uzbekistan	X	-	-
VU	Vanuatu	X	-	-
VN	Viet Nam	-	-	X
Only e-mail connection may be a UUCP or FIDOnet network connection. > P Provisional connection Data sources: International E-mail accessibility FAQ by Olivier M.J. Crepin-Leblond, release 96.07.02 of 30 Jul 1996, available at http://www.ee.ic.ac.uk/misc/country-codes.html, supplemented by secretariat information.

22. A World Wide Web search in August 1996 found three networking initiatives that were active in more than one country in Asia and the Pacific. The Sustainable Development Network of UNDP was formulated following the United Nations Conference on Environment and Development in 1992, and in particular paragraph 40 of Agenda 21, which addresses the information and networking concerns of developing countries. Under the programme, national networks have been established in China, Indonesia, Pakistan, the Philippines, the Republic of Korea, and at the South Pacific Commission, which services governmental and intergovernmental organizations and NGOs in Fiji, Samoa and Vanuatu. Another organization supporting networking under the large umbrella of sustainable development is Canada's International Development Research Centre (IDRC) and the Pan Asia Networking (PAN) programme of its Asia regional office in Singapore. IDRC-PAN has had recent or ongoing activities in the Lao People's Democratic Republic, the Philippines and Viet Nam and has preliminary plans for Cambodia, India, Indonesia, Nepal and Sri Lanka. The programmes of UNDP and IDRC assist participating national organizations to establish connectivity to the Internet. They provide advice and training for the personnel running the networks, whose primary functions are substantive rather than of functioning as the national gateway to the Internet. The objective of the Open Society Institute's Regional Internet Program (OSI-RIP), which is funded by George Soros, is however the connectivity itself or the provision of e-mail and full Internet access to individuals and organizations of Central and Eastern Europe and the independent states of the former Soviet Union. In the ESCAP region, OSI-RIP has been active in Azerbaijan, Kazakstan, Kyrgyzstan, Mongolia, the Russian Federation, Tajikistan and Uzbekistan.

23. The World Bank has established the Information for Development Program (infoDev) to help developing economies benefit from modern information systems. Among other things, the programme disseminates best practices to Governments and channels to them technical assistance and policy advice in telecommunication reform and information strategies. Its activities have so far been concentrated mainly in African countries, but proposals are being considered for Asia and the Pacific region as well. The funding of infoDev, which is untied, comes from the World Bank Group itself, from multilateral and bilateral donors and from the private sector. The Intergovernmental Informatics Programme (IIP) of UNESCO has had two networking initiatives in the region, namely the Regional Informatics Network for South and Central Asia (RINSCA) and the Regional Informatics Network for South-East Asia and the Pacific (RINSEAP).

24. Although the donor contribution in all the above initiatives has so far been modest compared to the needs, regional networking programmes are important in creating awareness of the great potential that the globalized information society has to offer for developing countries. Initial connectivity openings have usually been among academic or business circles, driven by their interest in easier access to information and communication. After international networks have reached the countries, it becomes increasingly important to provide equitable access to communication and information nationally within all sectors of the economy, groups of people and geographical areas. Access to national and international information can accelerate the adoption of more efficient and new technologies, improve the functioning of markets, and thereby have multiplier effects in local economies. Wide-scale networking will require substantial public investment, donor contributions, incentive programmes and other measures, since the potential marginalized users would not be willing and could not afford to invest in information technology.

G. Secretariat activities in public sector computerization

25. In December 1995, the secretariat organized an Expert Group Meeting to Review Computerization Development in the Public Sector with generous financial assistance from the Government of Japan. The report of the meeting (STAT/EGM/RCD/Rep) is available as a background document for the Committee. The Expert Group Meeting made a series of useful recommendations for the future activities of the secretariat. It singled out human resource development as the most important area requiring attention by Governments. With the rapid pace of innovations, Governments needed to make sure that IT-related skills of civil servants were continually upgraded and updated to keep them relevant. All countries reported shortages of skilled IT staff, especially in telecommunication and computer networking. Moreover, there was a tendency for trained and skilled staff to move from the public to the private sector where compensation packages were better.

26. The Expert Group felt that Governments should give a higher priority to IT development. One effective way to achieve this was to make high-level decision makers and key executives aware of the advantages of the technology, and even get them personally to use modern information technology. Many countries had started to provide computer equipment as standard resources for all levels of schools, initially for computer literacy purposes, but usage had been extended to support the school administration and the curriculum in general. In some countries, the Internet had been introduced to schools through dial-up lines to give students and teachers access to sources of information worldwide. The Expert Group Meeting repeated the Committee's earlier request for activities creating IT awareness among high-level decision makers and key executives; it also requested the secretariat to assist countries in other aspects of IT-related human resource development.

27. The Expert Group recommended that the secretariat should establish an ESCAP World Wide Web server on the Internet as soon as possible as a means of information dissemination. It asked the secretariat to identify national repositories of IT information in member countries and initiate a network between them in order to share the knowledge and experience gained in the region in developing computerized applications; it also requested the secretariat to act as a switching hub in that network, facilitating contacts between experts and assisting countries to exchange information and experiences on the use of modern technologies and IT policies. It urged the secretariat to use all appropriate modern and conventional technologies to disseminate information about regional computerization activities to all members and associate members. It further asked the secretariat to facilitate study tours and exchanges of experts on computerization programmes and it saw the benefit in exchanging information on common applications in various countries, including sample documents.

28. On institutional arrangements, the Expert Group recommended that the secretariat should institutionalize an intergovernmental discussion forum for computerization experts in the public sector, emphasizing the need for continuity of membership. It requested the secretariat to identify focal points (organizations) in all members and associate members for ESCAP government computerization activities and to establish an informal network of public sector computerization experts.

29. The Expert Group felt that countries would greatly benefit from access to the Internet in information exchange and asked the secretariat to investigate possibilities to assist those countries not yet having a connection, for instance by setting up an Internet demonstration in target countries. The Group further recommended that the secretariat should publish a statistical handbook on computerization in countries of the region, with statistics and indicators covering various facets of the status and level of computerization (based on a secretariat survey), along with published international statistics. It also recommended that the secretariat should publish documents electronically, starting with the Government Computerization Newsletter and the Meeting proceedings.

30. The resources that the secretariat can allocate to public sector computerization are likely to remain small, making it impossible to act on each individual recommendation immediately. A positive development was the appointment of a Programme Officer responsible for public sector computerization, which took place in June 1996 after a very long recruitment process. While this may offer some prospect for more systematic programming in public sector computerization, the resource situation in the Statistics Division remains critical, especially after the non-reimbursable loan expert in computerized information systems funded by the Government of Japan completed his two-year assignment in June 1996. A greater and more visible secretariat role in public sector computerization can be achieved through the acquisition of extrabudgetary funds, continued provision of non-reimbursable loan experts and by reallocation of existing resources.

31. The secretariat is currently seeking extrabudgetary project funding to organize a seminar on information technology management for senior-level decision makers. The planned project builds on the assumption that computerization development is lagging not only for technological or financial reasons, but also because of organizational and managerial constraints, understanding of which will play a key role in amending the situation. The project is based on a recommendation by the ninth session of the Committee on Statistics to undertake activities to create greater awareness of the role of information technology among middle- and high-level management, including senior-level finance officials in the public sector. The secretariat is also working on the recommendations regarding information sharing and has a pilot version of a Web server running, although at the time of writing this has not been made accessible to the public.

32. The Committee on Statistics is invited to discuss national experiences in the light of the secretariat's note and to provide guidance to the secretariat on the priorities of its work in public sector computerization. The Committee may also wish to examine its own capacity to discuss public sector computerization issues in general and express its views to the fifty-third session of the Commission, which is to review the conference and thematic programme structures of ESCAP as mandated in Commission resolution 48/2 of 23 April 1992.