TL;DR: The Great Public Sector Makeover: AI’s Answer to Systemic Challenges

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TL;DR: The Great Public Sector Makeover: AI’s Answer to Systemic Challenges

In a live broadcast hosted by Agilisys and Contentive, industry leaders Mark Thompson (Professor of Digital Economy at the University of Exeter), Andrew Mindenhall (CEO of Agilisys), Darius Toomer (Head of Agilisys Transform), and Kenneth Correa (author of Cognitive Organizations) discussed the transformative potential of generative AI (GenAI) for addressing systemic challenges in the public sector. With inefficiencies, legacy systems, and growing demand for services creating significant strain, the panel explored how AI can drive meaningful improvements, optimise processes, and enhance citizen outcomes.

The live broadcast was structured around systemic challenges in public services, practical examples of AI in action, and a vision for the future of AI-powered transformation.

Key takeaways:
Key Challenges in the Public Sector


Mark Thompson opened the discussion by identifying six major systemic issues holding back public services:

1.      Inefficiency and Duplication: 
Public services are fragmented, with 430 councils, 2,000 social housing organisations, 650 NHS trusts, and tens of thousands of charities operating in silos. This setup leads to massive duplication of roles, processes, and technologies, which adds little value to citizens. Thompson stressed that public services urgently need to consolidate and adopt shared platforms to address this inefficiency.

2.      High Operating Costs: 
Duplication and legacy systems create enormous financial drag. Thompson argued that without radical, tech-driven solutions, the current trajectory of either cutting services or raising taxes will remain unsustainable.

3.      Misallocation of Public Servants: 
Many public servants are stuck in roles that add minimal value to citizens. For example, by reallocating just 20% of operating costs in higher education or local government, the UK could double the number of academics or increase public service roles by 34%, improving service delivery.

4.      Legacy Systems and Processes: 
Public sector organisations are locked into outdated technologies, procurement cycles, and political priorities that prevent them from embracing modern, data-rich digital solutions. These legacy systems perpetuate inefficiency and make it harder to adopt new tools.

5.      Skills Gaps: 
Public services often struggle to attract and retain talent with the skills needed to implement digitally enabled operating models. Thompson noted that the focus on data, digital, and technology (DDaT) skills has been valuable but insufficient. The sector also needs professionals who understand strategy, operating models, and cross-sector collaboration.

6.      Lack of Central Leadership: 
Thompson criticised the lack of coordinated leadership in addressing systemic inefficiencies. Without centralised efforts to harmonise processes, set standards, and foster collaboration, public services remain trapped in a “prisoner’s dilemma” where individual organisations hesitate to innovate unless others do the same.

 The Transformative Potential of Generative AI


Andrew Mindenhall reflected on the evolution of technology in public services, from early internet adoption and cost-cutting in the 2000s to the rise of cloud infrastructure and cybersecurity solutions. He positioned generative AI as the next phase, capable of delivering unparalleled productivity improvements.

Generative AI: A Game-Changer for Productivity 

Generative AI (GenAI) enables organisations to create solutions that go beyond data generation, producing context-aware, actionable outputs. Unlike traditional technologies, GenAI is accessible, faster to develop, and cost-effective to implement. Mindenhall described it as “a once-in-a-lifetime opportunity” for public services to address systemic challenges and improve outcomes at scale.

 
Practical Applications of AI in Public Services


Darius Toomer illustrated how generative AI can transform service delivery with real-world examples:

1.      Education, Health, and Care Plans (EHCPs): 
EHCPs, which support children with special needs, currently take up to 14 hours of administrative time per case. With GenAI, Agilisys’ tool can produce a first draft in 7 minutes, cutting down processing time by over 90%. While the AI generates a comprehensive draft, the final review and decisions remain with human caseworkers, ensuring accuracy and fairness. This approach reduces backlogs, meets statutory deadlines, and improves outcomes for children.

2.      Customised Vertical Applications: 
While horizontal AI tools like Microsoft Copilot are great for general tasks, specific challenges in public services require tailored solutions. For instance, Agilisys’ platform, Quick Action, enables rapid deployment of AI tools to address sector-specific needs, such as SEND (Special Educational Needs and Disabilities) assessments.

3.      Scaling Productivity: 
GenAI acts as an “army of analysts,” processing unstructured data, integrating diverse inputs, and distilling actionable insights. This empowers frontline workers to focus on value-driven tasks rather than administrative burdens.

Overcoming Barriers to Adoption

The panel acknowledged that public services face significant barriers to adopting AI, but these are surmountable with the right approach:

1.      Data Readiness: 
While many organisations feel unprepared, Kenneth Correa and Darius Toomer reassured the audience that perfect data isn’t necessary to start. GenAI can handle unstructured data, and piloting tools can reveal gaps that inspire improvement. Public services should adopt an iterative approach, learning and adapting as they go.

2.      Legacy Systems: 
Kenneth highlighted Brazil’s experience of “leapfrogging” legacy systems to embrace digitalisation. In the UK, Darius explained that GenAI tools can coexist with existing systems, supporting workflows without requiring immediate overhauls or complex integrations.

3.      Leadership and Culture: 
Kenneth emphasised the need for strong leadership to drive change. By engaging decision-makers and fostering collaboration, organisations can overcome resistance and ensure AI adoption aligns with broader goals.

4.      Ethical Considerations: 
The panel stressed the importance of ethical AI deployment. GenAI tools must be designed with citizens and public servants at the centre to ensure fairness, transparency, and trust. A human-in-the-loop approach ensures that AI enhances, rather than replaces, human decision-making.

A Vision for the Future

The speakers offered a compelling vision for how AI could transform public services over the next decade:

1.      Streamlined Service Delivery: 
AI-powered chatbots could handle citizen queries, freeing up staff for complex issues. Caseworkers could use AI to automatically generate reports, assessments, and plans, significantly reducing administrative burdens.

2.      Better Resource Allocation: 
By automating repetitive tasks, public services can reallocate resources to frontline roles, such as doctors, teachers, and social workers, improving the quality and availability of services.

3.      Integrated Systems: 
AI can help break down silos, enabling public services to share data, harmonise processes, and adopt citizen-centric approaches. This could reduce failure demand and improve outcomes across sectors.

4.      Empowered Public Servants: 
AI will not replace humans but will empower them to focus on creative, strategic, and moral decision-making. By automating routine tasks, public servants can spend more time delivering high-value services.

Kenneth suggested that AI could increasingly handle repetitive tasks, leaving humans to focus on areas where creativity and empathy are essential. Mark added that addressing inefficiencies in legacy systems will lay the foundation for more impactful frontline AI applications.

 
Why It Matters

Generative AI offers a transformative opportunity for the public sector, but time is of the essence. Organisations that delay adoption risk falling behind as the pace of technological innovation accelerates. By addressing inefficiencies, embracing AI’s potential, and prioritising ethical and citizen-focused design, public services can unlock significant productivity gains, improve outcomes, and better meet the needs of their communities.

The panel’s key message was clear: the tools are available, the opportunity is here, and the time to act is now.