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Visiting Fellow, Department of Computer Science, Australian National University
Version of 27 April 1999
© Xamax Consultancy Pty Ltd, 1998-99
This paper was prepared for presentation at the 12th International EC Conference, in Bled, Slovenia, 8-9 June 1999
Republished in 'Global Electronic Commerce', published by the World Markets Research Centre in collaboration with the UN/ECE's e-Commerce Forum on 'Electronic Commerce for Transition Economies in the Digital Age', 19-20 June 2000
This document is at http://www.rogerclarke.com/EC/ESD.html
Electronic services delivery (ESD) can be performed using a wide range of electronic tools. The explosion of the Internet and the World Wide Web during the second half of the 1990s has resulted in a substantial proportion of recent activity being focussed on that channel.
The dominant mode of use of ESD is by a single organisation, addressing its own interests and the needs of its own customers. Applications range from information provision and discovery, to interactions and transactions of varying degrees of complexity, but also include support for electronic communities.
Lessons learnt from implementations to date show that there are many ways in which ESD can fail to deliver on its promise. In many circumstances, moreover, the real needs of users are not served by single-organisation ESD. Provider organisations have a particular perspective, which is determined by the scope of their product and service offerings, or their governing legislation. Users and user organisations are concerned about their own business, and when they seek resources they generally have a specific problem to solve or opportunity to address. Frequently there is a mis-match between the two perspectives.
The resolution of the mis-match depends on the establishment of 'entry points', each of which reflects the needs of a particular market segment. The business case for intermediation of this kind is fraught with difficulties; but the barriers need to be overcome if ESD is to fulfil its promise.
As long ago as September 1993, the then U.S. Office of Technology Assessment was convinced that transition to electronic service delivery (ESD) was inevitable, that information technology opportunities abound, and that there was a need for strategy and vision in order to exploit those opportunities (OTA 1993). Yet ESD appears to have been seldom subjected to critical analysis. This paper sets out to address a current need, by describing and analysing this segment of the electronic commerce arena.
After a discussion of definitional matters, consideration is given to the factors that are causing developments to occur in ESD, with particular attention paid to the technology driver. This is followed by an outline of the categories of service that can be provided to users, commencing with the straightforward information access capabilities for which the World Wide Web was conceived, and moving on towards more challenging applications.
Further aspects of 'single-organisation' ESD are examined, including the question of how a business case can be established, and issues that arise in implementation. This leads to an analysis of the failure of many such schemes to satisfy the real needs of users.
'Multi-organisational' ESD is introduced, as a means whereby the mis-match between the needs of users and the capabilities of providers can be resolved. An architecture is described whereby 'entry points' for specific market segments provide users with the integrated view that they need. Challenges involved in this approach are identified.
The term 'electronic services delivery' is much-used, but seldom defined. This section considers the range of meanings that appear to be intended by its users.
The generic concept, which for which both the terms 'electronic business' and 'electronic commerce' are widely used, is usefully defined (Clarke 1997a) as:
the conduct of business with the assistance of telecommunications, and of telecommunications-based tools
ESD is most usefully defined as a sub-set of that broad class. Hence:
electronic services delivery is electronic commerce in services, i.e. the provision of services with the assistance of telecommunications and telecommunications-based tools
The term is commonly used in relation to government services, but is also used in discussing such industry sectors as banking and other financial services, trading in commodities, reservations for travel and entertainment events, and distance education.
A number of 'drivers' can be identified, which have stimulated the emergence of ESD. These include:
New capabilities have clearly been a primary driver. Technologies change quickly, and hence it is risky to define an activity on the basis of the technologies it uses. It is useful, on the other hand, to identify the technologies that are influencing the notion of ESD at the end of the 1990s.
The technology-focus tends to fall on the Internet, i.e. internetworking based on the Internet Protocol Suite in general and TCP/IP in particular (Clarke et al. 1998), with particular reference to the public Internet rather than closed internets within organisations ('intranets') and within sets of collaborating organisations ('extranets'). Within the Internet context, the primary focus at present is the World Wide Web, comprising web-servers and clients ('web-browsers'), which at present transmit primarily HTML files using the HTTP protocol. A significant number of additional standards are emerging, to address particular needs, extending the Web far beyond its original electronic publishing focus. Some ESD-relevant technologies are listed in Attachment 1.
Connection to the Internet can be achieved using an increasingly diverse range of public access points, including:
Apart from the Internet, other network technologies are feasible, have been used in the past, and will emerge in the future. ESD compasses many additional technologies, at all levels of the data communications hierarchy, and in all aspects of the data communications infrastructure. These include:
When developing their ESD strategies, organisations need to temper vision with practicality, devise a transition from old to new delivery mechanisms, and take account of the capabilities and preferences of each of their customer segments.
It has been natural that, initially, organisations have harnessed technology to address their own specific needs, and to better fulfil the needs that they perceive their own clientele to have. This section examines the functions that such schemes perform, the business models whereby they are funded, and issues that arise in their operation. It concludes with a discussion of a fundamental flaw in the notion of single-organisation ESD.
Classifications of the kinds of services involved have been attempted by various authors (e.g. Masser & Gerhards 1997, DeConti 1998). Research and consultancy work undertaken by this author have led to the following categorisation.
The most straightforward form of ESD is the provision of access to information. This reflects the origins of the Web, and the maturity of web-services for document-download and display.
Information may be provided in static form, e.g. as HTML, or in word processor or PDF formats. Text may be supplemented by embedded images or other objects such as sound and video. The effectiveness of the service depends not only on a match between the document's design and the user's background, interests and cognitive style, but also on the bandwidth of the link, and the capability of the equipment and software at the access-point. The initial web-sites established by many corporations and government agencies have been of this limited nature, roughly comparable to a simple pamphlet describing the organisation and its functions, and hence referred to as 'brochure-ware'.
A more sophisticated approach is to store the information in a form that is readily updateable, such as a database or directory. This enables the document that is provided to the user to reflect very recent amendments to the available data. Most commonly, this is performed by using 'CGI scripts' to provide an interface between the web-server and the background database management system. Pseudo-web-servers, such as Lotus Domino, are designed to provide an interface between older storage formats and the Web, and generate all documents from a proprietary database format.
A further refinement is to use a storage-format that facilitates the generation of a wide range of transmission-formats that are suitable to the diverse needs of a large user-community. Of greatest interest at present is the prospect of using the emergent eXtensible Markup Language (XML) as the storage format, enabling generation of, for example, HTML, Word, RTF and PDF formats.
It is feasible to interpose additional software between the request from the user and the document-base or database. This can be used to generate customised responses, which match to the enquirer's standing profile, or situation-specific needs.
A real document, or a 'virtual' document that is generated only on request, can be accessed only if its existence and location are first discovered. There are two broad ways in which discovery is supported. The first of these is hierarchical search down through a tree of menus. Such a hierarchy is pre-structured in order to match what the designers think is the appropriate taxonomical arrangement. Multiple such trees may be offered, and any given resource may be discoverable through multiple paths within the tree.
The other approach is the provision of indexes of keywords, of metadata, or of all text within a document-base. The user is then provided with a web-form into which search-terms can be keyed for submission to a search-engine. The search-engine consults the indexes, sequences matches according to some algorithm, and offers them to the enquirer.
Enhancements to these approaches include the pre-structuring of enquiries, and offering users pull-down lists and radio-buttons which assist them to select among relevant options. A further refinement involving interplay between the two approaches is the auto-generation of the content of nodes within hierarchical search-trees, based on pre-determined keyword searches. These can be run periodically or on request, in order to ensure that the node reflects recently-published resources.
The infrastructure that supports information access can be used for more than the display of documents in a web-browser. HTTP, or, preferably, FTP or MIME-encapsulated email attachments, can be used to enable users to download other resources, such as:
Forms and scripts can be combined so as to perform validation of data-entry on the customer's own workstation, prior to submission. Software might also be able to exercise control over the use of the material, and in particular to enforce copyright licence conditions, or report on infringements (Clarke & Dempsey 1999).
The 'information access' and 'resource download' categories of ESD described above are request-response pairs, with only limited interactivity. There is a rich range of ways in which individuals can interact with servers, and through them with other individuals and organisations. A conventional depiction of interaction modes and tools, which is derived from 'group decision' research, is provided in Attachment 2.
A straightforward form of interaction is an enquiry that involves iterative dealings between client and server. For example, a citizen might describe a situation, the service provider might prepare and send a customised response (by automated or manual means), and the citizen might choose from a set of options, or might refine the search-terms used for the first query. Beyond this is the possibility of email follow-up directly between the citizen and the relevant official.
Some kinds of interactions are intended to result in a change in a database maintained on the server. In this document, I use the term 'transaction' for that class of interaction. Typical examples from the public sector arena are an application for registration, a licence-renewal, and a tax-payment.
In many cases, however, complications arise. These include the complexities of real-life business-rules, the need for successive interactions between the parties, security concerns, requirements for signatures or attached documents, and the need for accompanying or associated payments.
The Web was simply not designed for such purposes. A great many enhancements have been delivered, or are in train. Some forms of transaction are operational, and some are burgeoning. Others are struggling to reach the mainstream.
A particular form of interaction or transaction that presents special challenges is access to confidential data, or to personal data relating to a specific individual. In such cases, it is generally necessary:
Access by an individual to personal data relating to themselves is a special case of access to personal data: there is, at least at this stage in the evolution of humans and of technology, no foolproof way of ensuring that a person is who they represent themselves to be. One of many incidents that demonstrate the sensitivity of the public to this issue is the 1997 furore concerning the online availability of U.S. social security records (SSA 1997, Tumin & Hurley 1998).
In some circumstances, a fundamental function of ESD may be the enabling of interaction within communities, and even the formation of new communities. Governments on the Continent of Europe have been particularly focused on the application of the Internet to dialogue among citizens, and between citizens and government. This is reflected in such documents as the Information Society Forum's Vienna Declaration on 'informed democracy' (ISF 1998), which is related to the Freedom of Information approach in the U.S.A. and Australia, and the European Commission's Green Paper (EC 1998).
Some private sector initiatives have also had this as a centrepiece of their product strategy, the most celebrated instance being amazon.com.
Technological vehicles for community support include e-lists, chat, and postable bulletin boards; and tele- and video-conferencing. Many more are conceivable. Aspects of electronic communities are addressed in a number of works by this author, including Clarke (1997c).
The notion of a 'business model' involves answering the question 'who pays whom, and for what?'. In general, implementation of ESD by a single organisation involves the preparation of a business case that will show returns from the investment that exceed the costs. In many cases, conventional financial analysis is inadequate, because qualitative factors loom large in the justification for action.
Moreover, stakeholder analysis frequently uncovers a large number of players, all of whose interests are affected by ESD initiatives. ESD is an instance of 'extra-organisational systems' (Clarke 1992), with all of the challenges that such systems entail. The business case preparation is made much more complicated in such circumstances.
In undertaking the financial analysis component of the exercise, the following potential revenue sources can be distinguished:
The dominant business model evident on the Internet during its first phase of popularisation (c. 1992-95) was sponsorship by governments (primarily the U.S. government, and especially its Department of Defense). During the Internet's first phase of commercialisation (1995-99), the main sources have been sponsorship by corporations, and advertising. This has been supplemented by an increasing amount of content-owner subsidy, as individuals, corporations and government agencies have migrated large volumes of information into web-accessible form. The justification for this has varied, and has included:
Most attempts at encouraging user-pays to date have been failures. The reasons for this are examined in Clarke (1999b), published in the accompanying Research Volume of the Bled 1999 Proceeedings. Given the lack of payback being achieved by many private sector sponsors and advertisers, it may prove unwise to predicate an ESD strategy entirely on the continued availability of the Internet and the World Wide Web in their present form.
To date, the emphasis in most organisations is still focussed so heavily on information discovery and access, that all of the remaining categories have made limited progress. This appears likely to change during the coming years, and even months.
Pre-requisites that have to be satisfied before an organisation can exploit ESD beyond the basics of a mere 'brochure-ware' web-site include the following:
Lessons have been learnt from early experiences, and from many false starts (e.g. DeConti 1998, Simsion Bowles 1998). Some key messages, culled from these sources and the authors own research and consultancy work, include the following:
A number of key technologies need to mature much more quickly if rapid progress is to be made. These include:
The approach to ESD described in this section can be effective provided that a relationship already exists between the organisation and each of its clients, that both sides know when and how to find one another, and that established communication channels exist between them.
But this underlines a fundamental flaw in the organisation-centric approach to ESD: companies and government agencies are organised in a manner that suits their own needs, not the manifold and ever-changing needs of their clients.
For example, when a small business enterprise is being established, it needs to interact with multiple levels of government, and multiple agencies within each tier, in order to satisfy regulatory requirements such as licensing and registration. In addition, most governments provide some forms of assistance to business enterprises, variously in the form of advice, services and grants. As with regulatory information, these resources are generally very difficult for a business enterprise to discover.
Small business's difficulties in dealing with governments are symptomatic of a more general problem. Officers in government agencies encounter problems in discovering information produced within their own government, let alone by other governments. Members of the public can be puzzled and frustrated trying to locate the appropriate agency to deal with. Citizens seeking to have a grievance addressed are frequently passed around government agencies, with each in succession denying that the problem is within their jurisdiction. Consumers have difficulties in locating companies in their area that retail and that repair goods produced by a particular manufacturer. Multi-business unit corporations have multiple relationships with their customers, yet are unable to integrate those relationships into a whole.
At the heart of these problems is a mis-match between the manner in which service-providers are organised, on the one hand, and the manner in which the market perceives the situation, on the other. To further pursue the licensing and registration information example, agencies are created by governments to administer particular statutes, and to perform particular functions. Agencies tend to last a long time, and to change their form only infrequently. New regulations are passed into law from time to time, but parliaments seldom conduct any rationalisation among agencies. In Australia, for example, the national government comprises some 400 operational agencies. In intermediate jurisdictions (six States and two Territories), each government has of the order of 100 agencies. At the local government level there are nearly 800 city, town and shire councils for 18 million people (the population of Texas or The Netherlands), spread over an area the same size as the U.S.A.
Business enterprises, on the other hand, are concerned about their own specific context, and are not at all interested in, or even greatly aware of, the structure of government. Each business enterprise has to interact with an uncertain number of agencies, in order to gain the necessary permissions to go about its business, and gather information that it needs in order to make rational decisions. It is not unusual for a new enterprise to need contact with between three and ten agencies, some obscure, in all three levels of government. This pattern is repeated in the cases of citizen-with-government, consumer-with-corporation and small-business-with-corporation relationships.
The following section explains how the inadequacies of single-organisation ESD can be addressed.
The term 'multi-organisational ESD' is used in this document to refer to applications of technology that are designed to overcome mismatches between market segment needs and provider segment perspectives.
At present, resolution of the mis-match is undertaken by business enterprises, consumers and citizens in their spare time (resulting in low quality compliance), or by business advisers and other intermediaries, such as accountants and lawyers, for profit (resulting in better quality, but higher costs).
Government agencies throughout the advanced world are recognising the need to establish ESD on a multi-organisational basis, in order to assist businesses much more directly. Progress is somewhat more muted in the private sector, due to its anti-competitive nature; and hence much of the following analysis is couched in terms of public sector initiatives.
The key to the approach is to envisage 'entry points' each designed to service the needs of a particular market segment. The term 'portal' is used in a related manner; it has, however, many serious problems associated with it (see Clarke 1999b), and hence this paper avoids it. The intermediating role of entry points is depicted in the diagram below.
Terms used in government initiatives of this kind include 'one-stop, non-stop, single-window' dealings through specific 'channels' designed (for example) for business, for citizens, and for people wishing to deal in land.
The objectives of these initiatives are the reduction of complexity, cost and uncertainty, the improvement of business competitiveness, and the improvement of citizen and customer services. Among the leaders in the area of entry points are the Government of the State of Victoria (MMV 1997), and the multi-governmental Australian Business Entry Point. See also ESDRG (1997).
An 'entry point' must be a reliable starting-point for a member of a market segment. For this to be achieved, the background, needs and mind-set of the target market must be appreciated, and the category of users must not be perceived merely as customers of a particular organisation.
The origins of the 'entry point' concept can be seen in counter-services, 'shop-fronts' and call-centres, which provide a central point-of-reference for a client-group. Contemporary information technology is sufficiently sophisticated, however, that web-based entry points can provide significantly more assistance, and can do so for much lower cost.
Centralised models are unlikely to be effective, because many providers must be involved. Instead, a distributed operational model is necessary, and this must be complemented by a federated model of governance.
Techniques need to be applied such that resources can be discovered from one location, irrespective of where they are stored and who they belong to. This can only be achieved through collaboration among the relevant organisations, and the application of appropriate standards for describing resources. As for single-organisation ESD, multiple delivery channels need to be supported. The general architecture of an entry point service is depicted in the diagram below.
The entry point operates as a funnel or lens [there are difficulties with each of the possible metaphors!!], offering resource discovery through hierarchical menus, open searches, and assisted searches. Such a scheme is heavily dependent on standards and guidelines, and multi-organisational consultative and co-ordinative arrangements.
In the private sector, a variety of 're-intermediation' strategies are worthy of closer attention. Examples include offer-comparator arrangements, which provide customers with information about the differentials between alternative providers offerings; and auction mechanisms which perform automated matching; and (more generally) trader schemes that mediate between the software agents of customers and providers.
Single-organisation ESD presents challenges, and multi-organisation ESD involves layers of additional difficulties. One significant question is why any organisation could be motivated to even participate in, much less sponsor, a multi-organisation ESD.
From the viewpoint of an individual organisation, producing a compelling business case depends on finding sources of revenue, and motivating the active participation of resource-providers. It may be that this is an instance of an application that can only ever be 'strategic', in the cynical sense that it cannot be rationally cost-justified, and will therefore only be entered into if a leader motivates the players to perform a 'leap of faith'.
Common approaches and standards need to negotiated among multiple, otherwise independent organisations, and they need to be applied within comparable timeframes. The difficulties of linking new arrangements into legacy applications and networks is parallelled by difficulties in adapting the mind-sets of executives, managers and operational staff alike. As with all change, threats loom not only to established patterns of work, but also to employment itself. In addition, initiatives can be slowed, and even undermined, by statutory limitations (which are often accidental) and commercial restrictions (which are often intentional, but may be outmoded or dysfunctional).
From the macro or policy perspective, if payback arises, but it cannot be reaped by the organisations that need to make the investment, then 'market failure' is occurring, and worthwhile investment may not be undertaken. Matters of industry economics, political science and regulatory law are not addressed in this paper.
Electronic services delivery is a very promising application of electronic business technologies. To date, it has been largely limited to information access and discovery, at the level of mere electronic pamphlets or 'brochure-ware'. More sophisticated applications hold the promise of far greater payback, both financial and qualitative, for many and perhaps for all stakeholders.
Application of ESD within a single organisation is challenging enough, because it forces substantial adaptation by individuals, and changes to business processes. Application of ESD within organisations, however, limits the gains that can be made. Multi-organisational ESD is needed, in order to support the discovery of relevant resources from multiple providers, by means of entry points. This is dependent, however, on collaborative activities among independent organisations.
This document draws heavily on interactions over the last several years with staff and associates of ETC - Electronic Trading Concepts Pty Ltd, and especially David Jonas and Steve Curran. In addition, much of the research has been undertaken in the context of clients in a variety of Australian government agencies, especially the Office of AusIndustry, to whom thanks are due especially to Phil Stevens, Ben Healy and Ian Macintosh; and the BEP Management Branch, and particularly Dr Guy Verney and David Nissen.
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Simsion Bowles & Associates (1998) 'Online Service Delivery: Lessons of Experience' Simsion Bowles & Associates, 1998, at Multimedia Victoria
SSA (1997) 'Social Security Plans To Offer Modified Online PEBES', Social Security Administration,, at http://www.ssa.gov/pebesreport/index.html
Tumin Z. & Hurley D. (1998) 'Social Security on the Web: the Case of the Online PEBES', John F. Kennedy School of Government, Harvard University, at http://www.ksg.harvard.edu/iip/cases/tumin.pdf
The content and infrastructure for these community service pages are provided by Roger Clarke through his consultancy company, Xamax.
From the site's beginnings in August 1994 until February 2009, the infrastructure was provided by the Australian National University. During that time, the site accumulated close to 30 million hits. It passed 50 million in early 2015.
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