Capturing performance opportunities in US state and local governments

State and local governments across the United States confront pressure to reduce costs while meeting residents’ rising expectations. The Trump administration’s actions at the federal level may reduce or even stop federal funding across a range of programs, leaving state and local governments with the dilemma of whether to continue such services or let them sunset.  At the same time, the changes originating in Washington, DC, offer many opportunities for organizational change.

State and local governments could consider six actions to improve their efficiency and effectiveness to avoid this sort of unhealthy rebound.These actions have been tested in government organizations as well as businesses and not-for-profit organizations. Taken together, they can deliver lasting performance change in state and local government operations.

1. Simplify is about stopping nonessential work and reducing overall demand on a government’s processes, people, and systems. This step is where leaders can begin addressing efficiency and effectiveness. Sometimes this action involves stopping outdated programs or pilots. It can also involve rightsizing tasks. Often, simplifying begins with root cause problem-solving to identify what really is creating demands on the system.
2. Orchestrate involves redesigning processes to reduce handoffs, eliminate bottlenecks, and improve constituent experience. Approaches that draw on lean management and agile design—such as process mapping and opportunity identification—can provide powerful strategies.
3. Digitize builds upon the first two actions to integrate digital technologies and approaches to improve end-to-end processes for constituents and civil servants alike.  Think improved secure data sharing across government processes, such as a single web portal to navigate all government services, or job application systems that enable job seekers to view and apply for all relevant government positions at once through a common platform.
4. Automate holds great potential to improve government performance. This action involves incorporating the full spectrum of technologies, from improved desktop productivity software to generative AI systems that accelerate coding and customization of content such as personalized call-center responses.
5. Reorganize focuses on making sure that an organization’s pieces fit together to support the new ways of working now and in the future. Streamlining organizational structures and clarifying roles can accelerate decision-making. Reorganization also involves updating processes to improve collaboration within and across teams or agencies.
6. Strengthen involves building skills, capabilities, and mindsets across all levels of state and local government organizations so they can work in new ways and sustain change. This action enables all the others over the long haul.

Looking through the enterprise lens of a governor, mayor, or city manager highlights specific strategies to achieve cross-agency performance impact. The aspirations for such enterprise-wide impact should be high. Some state governments, for example, have recently identified between $300.0 million and $1.5 billion in potential savings by focusing on major enterprise-wide improvements. Five cross-agency performance measures offer the starting point for identifying and then capturing such impact.

1. Asset optimization involves getting the highest value out of the physical things that state and local governments own and lease, such as real estate, water rights, parks, office space, vehicles, and other equipment.
2. Lean operations uses time-tested techniques to redesign processes, adopt continuous improvement practices, and adapt systems to both improve user experience and reduce costs.
3. Technology modernization can propel major efficiencies as well as enable improved performance.
4. Procurement and vendor management provides a direct path to cost savings for state and local governments. Consolidation of spending across a government enterprise provides economies of scale in purchasing, and disciplined, analytical category management improves pricing and consistency in service delivery and terms.
5. Agile organization is about ensuring that governments have the right people in the right place at the right time to accelerate decision-making, improve accountability, ensure results, and deliver continuous improvement.