Submission to Joint Standing Committee on the National Disability Insurance Scheme

Capability and Culture of the NDI

Ian Excell

Key Points

Early-stage NDIA development innovative up to initial pilot
DHS integration problematic
- Management and technology
Large management consulting firms inhibit
- Innovation from within public service
- Access to new and emerging technologies
- Efficient use of existing technologies
Large consultancies add to cost and risk of major IT projects
- ANAO activity documents this, and NDIA is a victim
A confident, knowledgeable NDIA management team is required for success
- Open to cooperative engagement with client communities
- Inquisitive of modern technologies
- Exploit existing technologies fully
  - Acumen to avoid Robodebt type solution

My Interest I am recently retired. Over the last 35 years I have worked in Canberra for companies (a large multinational and a small Australian start-up), supplying software and services to the Commonwealth.

Recently the ANAO has flagged that they have concerns about many of the consulting engagements entered into by many departments. The cost to the federal government of these consultancies has grown substantially over the last 20 with little benefit to the Commonwealth. It would be instructive to analyse several of the larger consulting engagements and measure them against:

Final delivered services against initially contracted deliverables
Involvement of technical experts from technology vendor(s)
Final cost against initial contracted budget
Number and cost of contract variations
On time delivery against initial contract time frame
Fixed price or time and materials contract
Whether contract resulted from an open render
Whether contract derived from an industry wide panel
Whether contract derived from a restricted panel

Perhaps these elements will be addressed if the ANAO investigates PEMS project where the technology in use has the capacity to provide a solution to the business problem but the pathway via consulting engagements has been slow and expensive.

The large consultancy firms mostly present technology solutions to clients that they know well enough to make significant profits. This will exclude technology innovation and set clients along a

Observations on Management Consultancies within Public Sector Technology Adoption

path for a long dependency on consulting services while goal posts are ever changing forcing clients to agree to expensive contract variations. This behaviour suppresses the innovative energy that is commonly available within the host organisation.

Senior management cadres focus on management expertise and the consulting firms are experts at offering up management solutions. Any technology discussions will likely be of limited scope and rarely innovative.

I believe that the history of the NDIS/NDIA is a case study that demonstrates that the risk associated with the engagement of management consultancies is far greater than realised or measured. The public sector is capable of innovative uses of technology when supported by IT educated staff supplemented by specialised contractors. Do consultants add value or simply increase cost?

I have been had the privilege of engaging with a wide array of public servants from almost every agency and have observed the journey of the bureaucracy’s adoption of technologies. In my experience new technology does not enter the public sector environment via the SES or centralising agencies such as the current DTA (or its many iterations over the last 20 plus years), but via the EL1 and EL2 levels or below.

Once a new technology establishes gains a small foothold it needs luck, favourable circumstances and a persistent support team to survive and achieve wider adoption. It helps to have technically knowledgeable senior managers to nurture the pilot instances to maturity in the organisation. Sadly, i have also observed the accelerating move away from technical knowledge, innovation, confidence and self-reliance within the SES cohort, and a move towards dependence on consultants, such that that journey has become significantly more challenging.

I believe that this culture has impeded the NDIA from engaging with modern, innovative, and effective technologies. In the first few years of the NDIA several new technologies were investigated, and some put into use up until the end of the pilot stage. The mix of technologies came from both small and large technology companies. None came from the large management consulting firms.

The initial NDIA design team consisted of public servants and a small number of specialist contractors not associated with any of the major consulting firms. The contractors were typically former public servants with extensive knowledge and experience of designing and running social service programmes in the Commonwealth.

This team investigated several new technologies and a few of those technologies were progressed to assist with the documentation and navigation of the NDIS. Not all progressed to the pilot stage, but for the pilot the NDIS team were engaging with a suite of technologies that could remove a lot of the fog of complexity that drives administrative systems. Expertise in these technologies was provided by contractors from those technology companies. Usually one or two people.

In that period the NDIA acquired expertise from specialist technology contractors, not management consulting firms, and was designing solutions in partnership with a community of people with a wide range of disabilities. The co-design approach produced interesting challenges and solving them stimulated innovate suggestions that were investigate and tested.

As the NDIA moved from pilot phase towards production systems it became evident that the Department of Human Services began to become more involved, which was to be expected. However, with that came the ever-increasing involvement of the management consulting firms. Those engagements expanded and became more prolific. At that time DHS was engaged in its attempts to use legacy technologies more effectively and came up with the Robodebt solution.

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It was evident that these management consulting engagements did not have expertise in the technologies that were in play at the pilot phase, nor were they interested in acquiring any such expertise. Rather they were and moving the NDIA service delivery into becoming a subset of the existing DHS services offering.

Complexity increased substantially with a reliance of static, disconnected documents, spreadsheets and data sets, and a belief that the existing DHS IT technology could provide the NDIA with the tools to become operational in the wider community. The newer innovative technologies did not fit in that picture and significant achievements were discarded. The NDIA culture focussed on clients disappeared along with a management team open to innovation culture as staff left and management consulting staff proliferated.

The result speaks for itself. The connection between the IT tools to support the staff and clients of the NDIA has spawned an array documents, spreadsheets and web pages that are disconnected. They are challenging to use, and finding a solution to an issue and likely to generate inconsistent, confusing and misleading advice to staff and clients.

The combination of legislation and regulation to instruct and navigate such a system is always going to generate complexity. Technology exists that can manage this complexity and present views to all participants (administrators, clients, service providers etc), that are consistent and unambiguous, but that approach rejected by DHS.

The contrast between the contributions made by the initial small team of specialised contractors and the multinationals was obvious. The contractors provided far greater value for a far lower cost. The consulting companies created additional complexity in the system for both the staff of the NDIA and its clients. That complexity has resulted in additional cost, customer exasperation and the introduction of management strategies similar to that which drove the Robodebt debacle. That excessive complexity has also created the opportunity for fraudulent activity and made it difficult to detect and eradicate.

However permanent public servants are capable of innovation but the current reliance of senior management on big brand consultancies stifles that drive. The NDIA can only succeed when it has a senior management team that is truly open to

Customer centric development and co design
New and innovative technology
Knowledge uninhibited by consultancy curation
Avoidance of Robodebt like initiatives

For example the challenge of fraud detection and reduction, is unlikely to be solved by any tweaking of business as usual by consultants. Two classes of technologies offer pathways to improvement.

Reduction of complexity with modern business management system that generates accurate information for all involved in the NDIS be they NDIA staff, clients or service providers
A fraud detection and management system that is capable of identifying the behaviour of all engagements with the NDIS and able to flag suspicious behavior in real time.
The NDIA should approach fraud as if it is a modern financial institution. Currently it is a government grants and case management operation where the technology deployed is a mix of legacy systems evolved over time by DHS and its antecedents.

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It is unlikely that any of these modern technologies have been presented to relevant
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managers as the curation processes of the consulting firms used in the past will have excluded these approaches.
Modern fraud detection technology is built on a philosophy that is at odds with the management style of DHS that has resulted in programs such the recent “Robodebt” program. i. The Robodebt approach essentially treats all clients as potential sources of fraud, (all clients are suspects) and deploys a lot of human and technology resources to identify fraudulent behavior. ii. This approach is expensive and retrospective as it looks back at historic activity as the basis for analysis. b. A modern approach treats the issue of fraud from a more positive view of clients. It assumes that genuine clients will be trying to engage legally with their provider. i. Hence if good behavior is identified and known then the aberrant behavior is likely to be fraudulent. ii. Fraudulent behaviour is more readily and reliably identified and far less costly to manage and eradicate. iii. Activity can be monitored in real time and some fraud prevented. iv. Innovative data science has produced such solutions c. This approach helps banks and financial institutions protect customers, and reduce risk and business operating costs by providing industry-leading machine learning, financial crime prevention solutions.

The NDIS can provide the NDIA staff and its clients with a management system that is efficient and fit for purpose. The public service has staff capable of driving a solution based on technologies that can provide an effective system for all. However once decisions are made of which technologies to use, The NDIA will need expertise from technology specialists as contactors, and a senior management team of individuals with public sector management skills along with a knowledge of and an appetite for new technologies.

The issue faced by the current NDIA can only be solved by stabilising the existing system with only essential additional development, while concurrently building a new system. It will be expensive but less expensive than continuing to tinker with what exists and how it is managed.