Podcast 🎧 & blog: Digital government in Sweden is like a doughnut

Sweden is perhaps one of those countries that, in international rankings on government and digitalization, you sort of expect to do well – and indeed, so they do. Estonia figures among them as well, and we regularly see the interest this draws in understanding how development takes place, where, what’s next. 

To take us there, and discover lessons learned, today we invite Johan Magnusson – professor, author, and Director of the Swedish Center for Digital Innovation (SCDI) in Gothenburg. With him, we rediscuss the Swedish approach to digital transformation so far. While it served government well for some time, demographic and budgeting challenges lie ahead. What’s to change in a highly decentralized public administration, where local authorities must take the initiative and there is no central coordination? And how? 

Beyond rankings: Where does innovation happen in Sweden? 

In charts and rankings measuring the state of digital development, Sweden tends to fare quite well. As an example, the country ranked 4th overall in the 2022 Digital Economy and Society Index (DESI) of the European Commission – by far scoring better than the European average on topics such as digital skills, e-government, firms’ level of technological adoption. “But these rankings focus on antiquated metrics,” Magnusson begins with. 

“On that regard, Sweden is excellent – we’re really good at forcing our citizens to go to a webpage and download PDFs. But that particular perspective on digital government is wrong. Digital government is about transformation, transparency, user first, proactivity. All of these things challenge the existing order of the organizations,” Magnusson says. 

“I consider digital government in Sweden to be like an American doughnut. A lot of things are happening on the outskirts of it, in the municipalities, the local regions. But there is a hole in the centre, because input from the central government is really absent in these issues, and it’s not discussed. The Swedish Constitution makes authority very decentralized here,” so the logic plays out along these lines. “But that doesn’t look like something we would want to change.” 

Digital solutions at work to face the demographic shift 

And why would you, if it seems to be working? According to Magnusson, part of this is due to the fact that Sweden is a very rich country. “Sweden doesn’t have to change, they don’t need to transform, right? But that thinking is built on the notion that things are going to turn out just right in the future.” 

Instead, digital transformation, and the use and demand for public services, could soon become an existential crisis for the public administration. “What we know, is that we’re seeing a massive shift in demographics. We’re talking 50% more senior citizens, for instance, in the next ten years. That will increase the demand in public services. But in turn, since we’re not that digitalized, that will increase the demand for new workers to join organizations,” Magnusson explains. 

“At the same time, there’s the closing of the borders and a very tough situation in terms of getting employees to your organization. So we have a deficit of people who actually can work, and an almost acceleratingly increased demand for public services.”  

This is an end-of-decade crisis, not that far in time. “Municipalities and regions are starting to notice deficits in their budgets, and are slowly starting to understand that we need to change. It’s not okay to have a below-average digital solution on the side – this needs to be fit to replace the previously manual service, right? Otherwise, we’re going to have to decimate what we deliver in terms of public services, because we won’t have more hands to work on them.” 

How SCDI is helping the public sector 

Assessing the current situation, strategy, consulting, implementation. This is what the Swedish Center for Digital Innovation (SCDI) is working on with the public sector – earning global recognition, as one of the top three environments for digital innovation research. “In the public sector, the stakes are high, and the market is not going to fix it. So research comes to help out,” Magnusson says. 

“Digital maturity assessments help organizations direct their attention to the prerequisites that need to be in place, providing them with a basis to start seeing what others are doing in relation to this. With the need for new knowledge, comes commissioned research – solving a specific issue, creating reports, but also spreading that knowledge to the entire sector involved. Because the needs of one organization might be shared with a lot of other actors in the public sector.” 

“We are not the best” – but see the way forward 

“I think the main thing we need is an understanding that we are not the best in the world. And that’s very hard for a Swede to understand. We invented many things, but are lousy at making more transformative changes. We can do better, and that’s the first step. Then, we need to understand what digital transformation is,” Magnusson concludes.  

“It’s about the core principles in terms of digital government coming from the OECD as well – transparency, proactivity, user first, etc. That’s the fundamental shift. And in order to do that, we need more international cooperation – not in the way of filling out forms on how many kilometers of cables we dug down. But meeting each other, sitting together and talk about this. That’s what we need.”