IT value creation in public sector: how IT-enabled capabilities mitigate tradeoffs in public organisations

Governments today are striving to improve services in the public sector through digital transformation programs but face tremendous pressures from multiple fronts (economy, national security, healthcare, education, etc.). Even when worldwide enterprise IT spending for the government and education markets has been increasing and is expected to surpass $652 billion in 2023 to cater to such transformation programs, 80% of the government transformation efforts failed to achieve expected results. A plausible reason for this lacklustre performance could be the presence of tradeoffs or conflicts that is particularly salient in public organisations. To better understand the mechanisms by which IT enables or inhibits capabilities of the public organisations in attaining public value, we adopt a conflict resolution lens to study how information technology (IT) enabled capabilities to mitigate these tradeoffs. Using a dataset collected from public organisations in a European country unreeling from a financial crisis, we examine the processes by which IT enables public organisations to manage the tradeoffs arising from conflicting value-based goals. We identify three mitigation strategies facilitated via IT-enabled organisational capabilities – bias, tunnelling and hybridisation. This paper contributes to the understanding of how IT mitigates value-based tradeoffs in public organisations to achieve public value.