National Transformation in the Middle East - A Digital Journey - Deloitte
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National Transformation in the Middle East A Digital Journey
Abstract
Digital Transformation is playing a accessibility of resources for citizens, such
fundamental role in shaping the way as e-learning content, event information,
governments across the world are open government data and more.
adapting to new opportunities and Governments are integrating services in
challenges. Competition, cost and budget the form of mobile apps and one-stop-
pressures, shifting citizen demands, shop e-service centers to create seamless
among other changes are sparking customer journeys that encourage
governments all around the world to paperless transactions and e-payment
implement innovative ICT capabilities options for services. The digitalization
to drive their transformation to digital. of content such as medical records,
Digitally mature countries like Estonia, education curriculums and more is
South Korea and Singapore have realized allowing for better operational efficiencies
the value of Digital Transformation and across organizations. Finally, the rise of
have successfully progressed to deliver autonomous cars is expected to ensure
delightful customer outcomes. the connectivity of people and networks
across cities.
GCC countries are making the move to
build on international best practice and The successful outcomes of these
leverage opportunities to transform into programs will be driven by the rapid
Digital Government models. The National adoption and well-planned execution of
Transformation in the Middle East: A digital programs. They will be supported
Digital Journey, identifies six high impact by technologies like artificial intelligence,
themes relevant to the Public Sector in the robotics, cloud, Internet of Things, and
UAE, KSA, Qatar and Kuwait: Smart Cities, virtual reality, and governed by digital
Smart Tourism, Next Generation Care, program offices encompassing the cross
Classroom of the Future, Smart functional impacts. These transformations
Government and Future of Mobility. are long-term and each stage of maturity
Across these themes, government is driven by specific steps to be
strategies are emphasizing the role of undertaken across the digital business,
digital in order to accelerate economic digital operations and digital customer
diversification, promote sustainability and horizons. Building maturity across these
enhance citizen satisfaction levels by domains is the way forward for the Public
implementing exponential technologies. Sector to deliver sustainable public service
growth aligned to the 4th industrial
Smart solutions have emerged as a result revolution.
of these efforts to incorporate digital into
initiatives across each key digital theme.
For example, national platforms have
been successfully developed as a means
of sharing information and enhancing
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Deloitte | National Transformation in the Middle East | A Digital Journey Content Forewords 01 1. Digital Transformation in the Public Sector 04 2. Digital at the heart of GCC transformation 14 3. The GCC on the Digital Transformation journey 60 4. Implementing Digital Transformation 68 5. Public Service in its broader ecosystem 76 6. Implications for Government and Industry 82 Appendix 83 Glossary 87 Endnotes 89
Deloitte | National Transformation in the Middle East | A Digital Journey
Foreword: Deloitte
Over the past decade, countries across Deloitte has developed in collaboration
the world and in the Middle East have with Huawei to examine the role of Digital
witnessed some of the most seismic shifts Transformation and Digital Government in
in their economies, societies and the Middle East.
environment. The financial crises
restricted access to capital for billions, The paper analyses global and regional
rapid population and urbanization growth Digital Transformation trends in the Public
has led to the birth of mega-cities and Sector, and based on this, identifies six
more extreme weather conditions have key high impact themes that are at the
scarcened essential power and water top of policymaker agendas. Across
more than ever before. these themes, the study explores how
governments in the Middle East are
At the same time, we have also seen applying Digital Transformation today,
some of the greatest technological where they are on their Digital
breakthroughs and advances ever made. Transformation journey in relation to
Artificial intelligence, flying taxis and the international best practices, uncovers
Internet of Things, once figments of our key challenges they need to overcome
Emmanuel Durou imagination, have now become a practical as well as the opportunities they need to
Partner, Head of Middle East reality, unlocking new answers to key capitalize on going forward. To support
TMT Industry challenges, and new possibilities. Such this journey, the paper recommends a
Deloitte & Touche (M.E.) advanced technologies have completely Digital Transformation pathway regional
transformed the way we as citizens governments can take to help them
interact, learn, move, live, work and earn. succeed towards achieving their national
Entire industries from media, retail, and transformation goals.
tourism to finance have become
disrupted, and the Public Sector now is We are pleased and honoured to have
also at the helm of a major Digital worked alongside Huawei on this new
Transformation. study, a leading ICT player in the region
and we thank them for their vision,
Countries need to be at the forefront of expertise and support. We also express
these changes to address the global and our gratitude to the government entities
national challenges they face. Recognizing across the region that provided their
this, governments the world-over are now invaluable insights in support of this
harnessing new exponential technologies paper.
and embarking on their own Digital
Transformation journeys, some more While the study is based on Deloitte and
advanced than others. Huawei research, international Digital
Government surveys, interviews with
To this end, governments across the regional governments and subject matter
Middle East have launched ambitious experts, we do not however presume ours
national transformation plans with a is the last word on any given topic: our
major focus on enabling ICT and Digital intent is to catalyze discussions and
Transformation technologies, to address positive developments in the area in the
their own economic, social and best interest of regional governments,
environmental challenges. As such, the businesses and civil society alike.
new era of national transformation, is a
journey that we believe is truly digital.
From this perspective, we welcome you to
“National Transformation in the Middle
East – A Digital Journey”, a whitepaper Emmanuel Durou
01
Deloitte | National Transformation in the Middle East | A Digital Journey
Foreword: Huawei
Digital is having a profound impact across Digital Transformation, harnessing and
the world’s economies, societies and integrating digital technologies to develop
future sustainability. The rapid smarter cities and become smarter
proliferation and adoption across the nations, a key outcome of their national
world of the internet, including visions.
broadband, mobile and digital
technologies such as social media, Huawei is focusing on helping the Middle
smartphone devices, big data, cloud and East region accelerate its National ICT
the Internet of Things has given rise to a transformation plans from vision to reality
new era of hyper connectivity: the growing through our broad ICT platform
interconnectedness of people, capabilities of Cloud, Pipe and Device plus
organizations, and machines. a rich ecosystem of global and regional
solution partners.
This increasing digitalization is enabling
the growth of a new Digital Economy, the To help key stakeholders understand how
economic activity that results from billions Digital Transformation can enable success
of everyday online connections among in achieving national goals and the
Safder Nazir people, businesses, devices, data and potential impact it can have, we partnered
Vice President, Digital Industries, processes. It has completely transformed with Deloitte in the development of this
Strategy & Marketing our urban transportation, social and whitepaper, leveraging on their expertise
Huawei Technologies - Middle East government interactions, our learning and in Digital Transformation, Digital
health experiences, the work we do and Government and experience working with
the way we live. Mobile is now our first Middle East governments on their national
screen, digital is now the primary channel, transformation journeys. We thank
data is the new currency and automation Deloitte for their invaluable thought
is our key to unlocking new efficiencies leadership and the regional government
and productivity. entities that have provided their key
insights in support of this paper.
With the disruption of every major
economic sector ranging from e- We invite you to explore with us the
commerce in retail, on-demand “National Transformation in the Middle
entertainment, travel and hospitality to East: A Digital Journey”, a paper which
the advent of FinTech in banking and assesses the trends and benefits of Digital
insurance, digital technologies also Transformation for the Public Sector and
represent an unprecedented opportunity the role of New ICT as a key enabler for
for the Public Sector to reinvent itself. As Digital Transformation. Middle Eastern
such, governments are now digitally governments are on their Digital
transforming the way they interact with Transformation journeys, learning from
citizens, deliver public services and tackle successful digital use cases can help
their greatest national challenges. them to accelerate the realization of
their national goals to become more
Middle East governments, in response to competitive, world leading smart nations.
oil price pressures, rapid population
growth, urbanization and rising citizen
demands have also embarked on massive
national transformation plans of their
own. All of these plans are explicit about Safder Nazir
02
1. Digital Transformation in the Public Sector
Deloitte | National Transformation in the Middle East | A Digital Journey
1. Digital Transformation
in the Public Sector
The future of governments –
Demographic changes, new societal
behaviours and technological
“Gov2020”
Demographic changes, new societal
breakthroughs are amongst the key
behaviors and technological
breakthroughs are amongst the key
drivers transforming the Public Sector.
drivers transforming the Public Sector. By
2020, 60 percent of the global population
Governments will need to be at the
will be living in an urban area. New
innovative transport modes will be
forefront of these changes.
deployed, such as autonomous vehicles
and drones flying over cities1.
Governments will transform from a state
of reactivity to proactivity in a variety of
aspects ranging from policy decisions to
emergency responses. Two billion people The role of digital and ICT in Public experience. For example, by using mobile
without financial services will gradually Sector transformation applications, individuals can create
enter the banking system, and education Whilst the drivers of Public Sector “service orders” to repair public
will become more inclusive pushing for no disruption are manifold, for the purpose infrastructure.
child to be left behind in a world where of this paper, it was chosen to place a
illiteracy costs the global economy US$1.2 particular emphasis on digital In the future, these trends will increase
trillion per year2. technologies and their role in government exponentially as governments will be able
transformation. Digital technologies to allocate funds in more efficient ways.
Governments will need to be at the represent an unprecedented opportunity Using Internet of Things (IoT) to collect
forefront of these changes. As part of a for the Public Sector to reinvent itself, and aggregate data through connected
recent global report, “Gov2020: A Journey especially considering the convergence devices with sensors can collate mass
into the Future of Government”3, Deloitte of four prominent technologies: social amounts of information and predict the
identified 204 Public Sector trends applications, mobile technologies, big data occurrence of events. Predictive modeling
including 37 cross-sector and 167 specific analytics and cloud infrastructure. These will become more prevalent and data will
sectorial trends which will shape the technologies represent a combined global be processed into valuable information to
future of the Public Sector in the coming market of approximately US$1.2 trillion in increase the accuracy of Public Sector
years. Each of these trends will have the 20174. Furthermore, this market will decisions. Smart services based on
potential to reshape Public Sector witness a double digit compound annual remote devices connected to a mobile
operating models with the aim to improve growth rate (CAGR) over the next few network will enable governments to
service delivery experience, foster the years. enhance personal safety, sustainability,
economy, enhance citizen well-being and health, wellness and sanitation. Finally,
become more cost effective. Many of the Governments can now use cloud based with regard to Smart Cities, the world is on
analyses and outcomes contained within environments to enable new public- the brink of a new wave of disruption
the report have been used as a stepping private partnerships for the provision of considering that opportunities in this
stone for this paper where future public services. Already, many government domain are still largely unexplored and
government shifts will be analyzed services are being made available through have the potential to transform the way
through the lens of Digital Transformation. mobile, enhancing service delivery cities operate.
05Deloitte | National Transformation in the Middle East | A Digital Journey
Figure 1: Selected impact on ICT economies
Digital technologies
Economy represent an
unprecedented
Society Sustainability
opportunity for the Public
Sector to reinvent itself.
+1.0% -1.0% -10% 26bn The convergence of four
Growth in GDP, Lower unemployment Death toll from road Tons of net avoided
prominent technologies:
social applications,
resulting from rate recorded by cities accidents by using CO2 emissions from
every 20 percent that invest in smart grid usage based insurance 2016 to 2025 by
mobile technologies, big
increase in technology and coupled with assisted launching digital
ICT investment infrastructure driving technologies initiatives
Source: World Economic Forum5
data analytics and cloud
Digital maturity in the Public Sector Figure 2: Biggest drivers of Digital infrastructure represent a
combined global market
Transformation
As pointed out earlier, Public Sector
of approximately US$1.2
entities across the world are embarking on Question: What is the biggest driver of Digital
a Digital Transformation journey to help Transformation?
overcome the many critical challenges
trillion in 2017.
they face. According to interviews 5%
conducted with over 1,200 government
6%
entities worldwide, Deloitte identified the 38%
main drivers of Digital Transformation in
14%
the Public Sector shown in the figure on
the right6.
According to interviews
conducted with over
1,200 government
entities worldwide,
Deloitte identified 3 main
37%
drivers of Digital
Cost and budget Customer/citizen
Transformation in the
pressures demands
Public Sector: cost and
Federal government Others
directives
budget pressures,
Digital maturity of
other agencies
customer/citizen Source: Deloitte Global Digital Government
Transformation Survey, “The Journey to
demands and federal Government’s Digital Transformation 2015”,
Deloitte University Press (DUP)
government directives.
06Deloitte | National Transformation in the Middle East | A Digital Journey
Many industries have experienced the Figure 3: Public Sector benefits from the lessons learnt in “Industry 4.0”
impact of digital disruption before the
Public Sector. This advent of digital
technology is revamping the way of doing
50
business across industries, at different
Lessons learnt
paces and impacts. A comparison across
45 Long fuse, big bang sectors
industries based on digital impact and
ICT & media
Retail
timing is presented in figure 37.
40 trade Finance
Education
Transport &
Figure 3 outlines the main industry groups
35 post
Impact (% change in business)
Professional services Health
that have been impacted at different
times and different levels of disruption by
30 Agriculture Recruitment &
Arts and
digital. Interestingly, Public Sector related
cleaning
recreation
25 Government
entities (grouped with “long fuse, big bang
Real estate
services
industries”) are being severely disrupted 20
now by digital, but this impact has been
Utilities
felt years after other sectors have, such as
15
ICT and media for instance. The
Construction
opportunity for the Public Sector is to
10 Accommodation & Wholesale trade
learn from the experiences of the “short
food services
Mining
fuse, big bang industries” to best adapt to
5 Manufacturing
digital. 0
From a Public Sector
perspective, the relative
0 1 2 3 4 5
Timing (years)
absence of competition
Public Sector related industries
has delayed the With globalization, countries are In developed countries, Digital
decision to undergo
increasingly competing against each other Transformation serves primarily as a way
for talent, foreign investment and to reduce budget pressure while
comprehensive development. Ensuring that their digital enhancing customer experience. Certain
transformation exercises
infrastructure is in place has become a emerging markets (i.e. South Korea, UAE,
major competitveness differentiator as Singapore, Estonia) have successfully been
up until the “status-quo” reflected in a number of international
competitiveness indices. This, in turn, has
able to achieve great progress in their
digital initiatives. One of the factors that
became unsustainable. pushed countries both regionally and has helped these emerging countries to
However, in this day and
internationally to put in place national move quickly in their transformation is the
strategies to enhance smart government absence of legacy technological
age, transitioning to performance. infrastructure as compared to more
digital is no longer
developed countries.
optional.
07Deloitte | National Transformation in the Middle East | A Digital Journey
How to assess the digital maturity Figure 4: Deloitte’s Digital Maturity Assessment Framework
of a sector
As indicated above, while technology is an
intigral part of a Digital Transformation, it
requires a 360 degree operating model
change. Digital Transformation is primarily
about strategy supported by technology.
It requires a focus on developing needed STRATEGY
capabilities such as skills, culture and
leadership.
As shown in the model on the right, digital
maturity should be viewed through the
OPERATIONS CITIZENS
lens of five key pillars which form the core
components of Deloitte’s Digital Maturity
Assessment Framework.
These five pillars can support Public
Sector entities in order to answer the
CULTURE, PEOPLE,
following questions and assess their digital
TECHNOLOGY
ORGANIZATION
maturity:
• Do you have the right vision and strategy
for digital, and the leadership,
communications and focus required to • Do you have the right technologies and
support this vision? infrastructure as well as the ability to
• Do you have the right people, talent, develop, manage and deliver?
skills and knowledge to support your • Do you have the right approach to
vision, products, and services? understanding and communicating with
• Do you have the right processes, your customers to succeed in a digital
controls and digital technologies to environment?
support the operations of the
organization?
Digital Transformation is primarily about
strategy supported by technology. It
requires a focus on developing needed
capabilities such as skills, culture and
leadership.
08Deloitte | National Transformation in the Middle East | A Digital Journey
Global challenges in the digitalization Budget and capability constraints remain unwilling to transition to newer
of the Public Sector Budget constraints restrict organizations digital channels.
Despite the pressure to change, Public from investing in the right resources to
Sector organizations are facing challenges transform their operating models (i.e. Privacy and security
in embarking on this journey. As per investing in new technology systems, Governments regularly deal with sensitive
Deloitte’s Global Digital Government hiring new talent etc). In this context, data related to personal information such
Transformation Survey8, many many Public Sector entities struggle to as passport numbers, driver licenses and
organizations recognize that they are find the necessary budget to fund Digital other classified information.
neither ready to respond to digital trends Transformation initiatives, even though it
nor satisfied with the progress on the can lead to substantial cost savings. New avenues that are offered by
initiatives they are undertaking. According technologies such as cloud computing,
to government entities, the main As per Deloitte’s Global Digital analytics (i.e. big data and open data) in
challenges and barriers that are impeding Government Survey, culture, workforce terms of improvements are
the implementation of these solutions and skills and leadership are areas that remain counterbalanced by greater risks
programs can be categorized into the a challenge for Public Sector regarding data protection and
following: organizations. As such, internal capabilities confidentiality. This can be seen by the
are a constraint that hinders the journey number of security breach cases that have
Policy bottlenecks and in transitioning to full digital maturity. made the news in the last few years.
bureaucratic inertia
Embarking on this journey requires hiring Notwithstanding, with considerable
new talent and skills that were previously improvements in terms of security and
Budget and capability constraints not available in-house and that are not privacy protection, many governments
always readily accessible in the market. remain reluctant to further open up their
Moreover, instilling a culture that is more data.
innovation driven as opposed to
Digital exclusion and divide
operational is a challenge that many Public Transitioning government staff
Sector organizations have not yet to new roles
resolved. With regards to government service
Privacy and security
digitization, the primary stakeholders
Transitioning government
Finally, the digital understanding and affected are employees used to delivering
commitment of leadership are key in manual tasks, but later require new types
staff to new roles
developing a foundation that will drive of skills. Too often, governments neglect to
Policy bottlenecks and strategy and its implementation. Despite offer bespoke trainings to employees who
bureaucratic inertia this fact, too often, entities face situations have transititioned to new roles and are
Public Sector entities need to keep up to where leadership is not strong enough to left without the required capabilities to
date with the rapidly evolving digital drive these changes. properly manage the new position.
technologies and innovations, yet these
developments often involve drastic Digital exclusion and divide Value at stake
changes to their operating models. Given Digital literacy is the awareness and ability Digitizing government entities and their
the complexitiy of such changes, some of people to use digital tools in their daily services can bring about major
entities prefer to adopt a “status quo” lives. Overall, digital accessibility has improvements for governments, citizens
approach and delay the decision making improved dramatically over recent years and businesses alike, and in turn,
process. thanks to new, more tech-savvy contribute to the competitiveness of a
generations and enhanced ICT content in nation. According to Deloitte’s National ICT
Additionally, legislative and regulatory school and university curriculums. Index which measures a variety of ICT
bottlenecks generate longer periods of Nevertheless, digital exclusion remains an readiness factors (i.e. telecommunications
time and resources required before issue with a persistant lack of adoption of infrastructure, ICT regulation, government
organizations can start implementing any these technologies by certain population ICT adoption and social ICT impact), the
initiatives. categories. Individuals residing in rural GCC has made significant progress in
areas remain secluded from basic recent years, but on average, lags behind
technologies such as high speed internet. other developed economies in terms of
Moreover, older generations at times Digital Government capabilities.
9Deloitte | National Transformation in the Middle East | A Digital Journey
Figure 5: The National ICT Index
84% 84%
77% 78% 78%
74% 75% 76%
72% 72% 72% 73% 73%
67% 67% 68%
70% 70% 62%
64% 66% 66% GCC
58%
55%
52%
47% 50% 51%
45%
40%
29%
Note: see Appendix for methodology and for calculation of National ICT Index for Canada
Source: Deloitte research and analysis, based on various published national indices and indicators from World Economic Forum
The value at stake for governments can be According to the National
ICT Index, the GCC has
measured in a number of ways that range
from a cost saving perspective to the lens
of creating value for citizens and
businesses with better service delivery.
made significant progress
in recent years, but on
Impact on the Economy
Such improvements include citizen Case study: business cost
average, lags behind
wellbeing (e.g. satisfaction with reduction in New Zealand
government services), or ease of doing
business (e.g. time to open a company). other developed The New Zealand Ministry of
Business, Innovation and
economies in terms of
There are three main areas (economy,
society and sustainability) where Digital Employment has launched a new
Digital Government
Transformation of the Public Sector can initiative to improve Public Sector
lead into tangible and quantifiable benefits service delivery to business
that are illustrated based on case studies capabilities. customers with the ultimate goal
below: of decreasing costs to businesses
(business cost to be reduced by
25 percent) when dealing with the
government and enhancing the
overall competitiveness of New
Zealand’s businesses.
Impact on Society Impact on Sustainability To achieve these goals, the
Case study: combating Case study: safety for ministry launched several
foodborne illnesses in the USA emergency services in the USA initiatives:
Chicago is using advanced In the wake of the 2014 • Making tax simpler:
analytics combined with big and Washington State Oso mudslide, Businesses will be able to
open data to combat foodborne the public, private and process their tax through
illnesses. Using unstructured philanthropic sectors collaborated improved online services
datasets including 311 complaint to fly drones with advanced
• Accelerator: An accelerator has
calls, sanitation inspections, and sensors using reality computing. It
been launched where Public
even weather help, health then developed and printed a 3D
Sector staff collaborate with the
inspectors have been able to surface model over the disaster
private sector entrepreneurs,
forecast violations and focus on zone. Consequently, drones were
developers and mentors to
food establishments most likely able to map the entire area in
develop services with the goal of
requiring attention. With this new seven hours, an activity that would
solving major pain points for
approach driven by prevention have normally taken two to three
local businesses11.
and anticipation, violations are days, and it kept responders safe
now being discovered on an in the process10.
average of seven days earlier9.
10Deloitte | National Transformation in the Middle East | A Digital Journey
Figure 6: Multi-layered architecture to address Digital Transformation for Public Sector
National Transformation Plans
Industry & Government Digital Transformation
Transport / Tourism
Cross-Government
Economic Sectors
Healthcare
Education
Defense
Energy
…
National Transformation Platform
Alternative Modes of Transport
Patient Powered Healthcare
Healthcare Data Revolution
Intelligence & Surveillance
Environmental Innovation
Sustainable Consumption
Key Digital Trends
Classroom of the Future
Tomorrow’s Curriculum
Rise of Robot & Drone
Next Generation Care
Smart Data & Devices
School Systems 2.0
Smart Government
Future of Mobility
IoT in Defense
Smart Tourism
Smart City
Note: trends are not exhaustive
The Public Sector’s key themes for trends identified in the “Gov2020: A
Digital Transformation Journey into the Future of Government”12
Digital has an impact across multiple report. Each trend was then derived by
layers and levels of any organization. looking at a broad range of sectors (i.e.
Identifying all the services that can be education, defense, transportation, energy
digitized is an exercise that goes beyond and environment, healthcare, law and
the scope of this document. For the sake justice) and was supported by the
of this paper, the large universe of trends following intrinsic drivers that affect the
that are shaping the Public Sector was Public Sector: digital and exponential
analyzed in order to screen key themes to technologies, economy, demography and
be assessed that are relevant for the GCC society.
market. This paper leveraged the 204
11Deloitte | National Transformation in the Middle East | A Digital Journey
For the purpose of this paper, these Figure 7: Methodology to screen the key digital themes
trends were grouped into key themes
which were then filtered in two phases to Deloitte’s 204 cross-sector and sectorial trends
ultimately arrive at six of the most relevant
themes (as described in the figure on the
right).
The first filter reflects the theme’s
relevance to digital and exponential Trends across sectors grouped by category
technologies. This dimension underpins
the importance of digital as an enabler for
governements and Public Sector entities
Our methodology
Filter - Digital Related Categories
in order to take on such opportunities.
Twenty one digital-driven trends were
identified which range from IoT in defense
Key Public Sector digital
to smart cities, to the rise of robotics.
categories
Filter – Relevancy to the Middle East
Key digital Public
Sector categories
in the region
6 key digital Public Sector themes (high impact)
Figure 8: Mapping of digitally-relevant themes
Trends were bucketed in various
themes across sectors
Government Themes
Additive Healthcare Intelligence &
Defense Army of Defense Asymmetric Rise of robot and
manufacturing in defense trans- surveillance top IoT in defense
tomorrow spending threats drone armies
defense formation priority
The classroom of Higher School Tomorrow's The evolution of Next gen.
Education
the future education Systems 2.0 curriculum learning teachers
Energy & Urban
Smart data and Sustainable Sustainable Sustainable
environmental
Environment devices finance policy consumption
innovation
List of
Additive
204 Healthcare manufacturing in
Biometrics
evolution
Next generation
care
Healthcare
systems
Healthcare data
revolution
Patient-powered
healthcare
healthcare
trends
Law & Justice Predictive crowd
Security 2.0
flows
Human Real-time
Digital Social
Services location
customer financing
services
Transport / Innovation in
Smart Alternative modes Future of
Tourism pricing, funding &
tourism of transport mobility
payments
National Transformation of Government
Cross Sectors Smart Smart New basis for Alternative
Transformation government talent model
cities government national prosperity funding models
platform operating models revamp
Digital Trends
12Deloitte | National Transformation in the Middle East | A Digital Journey
The second filter is an assessment of the • Smart Tourism: Smart Tourism is the • Smart Government: Smart
relevance of these themes to the Middle use of ICT to promote travel and tourism Government refers to the use of
East and their impact on economy, society by enhancing visitor experience integrated information and
and sustainability. The final outcome communication technology in
reflects the most relevant digital themes • Next Generation Care: Next government policies, services and
related to Public Sector transformation in Generation Care is characterized as processes
the region. Ultimately, the following key pervasive, preventative, efficient and
themes were selected to be explored in personalized care through ICT usage • Future of Mobility: Future of mobility
detail throughout this paper: leading to higher quality and improved represents both the physical and digital
patient experience infrastructure and services that enable
• Smart Cities: Cities that use smart people and goods to move more safely,
technologies, data analysis and • Classroom of the Future: cheaply, quickly, cleanly and happily.
innovation to improve quality of life, Classroom of the Future represents the Existing and new advanced technologies
efficiency of urban operations, services transformation of traditional education are applied to improve mobility and
and competitiveness systems to digitally-enabled learning and resolve age-old transportation issues
curricula that enhances the learning such as congestion, capacity and
experience sustainability.
Figure 9: Selection of key digital Public Sector themes for the GCC
Impact
High High
d
yze
anal il
be det a
Public Sector Trends to
es rthe
r IoT ICT Technologies
he m fu Smart 5G, 4G & 3G
T in government POL
Next gen. care
Cloud computing
Blockchain
Smart tourism
Smart cities Future of
Analytics/Big Data Artificial
mobility
Social intelligence
Patient-powered healthcare Classroom of the
future Cyber security
Healthcare data revolution Robotics
OTN
Tomorrow’s curriculum IoT in defense Integrated
Sensor technology national
National Transformation platform Autonomous vehicles
Sustainable consumption platform
Rise of robot & drone armies Digital twins Unnamed aerial
Digital customer Vehicles
School Systems 2.0 SDN/ NFV
Real-time location services Augmented/virtual
reality
Smart environment data & devices LIFI
Security 2.0
3D printing
Low Low
Predictive crowd flows
Rele
East vanc
Mi ddle e to th
e
e to th eM
iddle
vanc
Low
Rele East
Low
High High
Note: trends and technologies are not exhaustive
132. Digital at the heart of GCC transformation
Deloitte | National Transformation in the Middle East | A Digital Journey
2. Digital at the heart of
GCC transformation
Digital Transformation: no longer optional
GCC countries have been, The imperative for change have recognized and reignited their efforts
at various levels and
and new ambitions to respond, improve and evolve.
The range and pace of social and
points in time, confronted economic challenges necessitating change
in the Middle East are unique. In the
GCC countries have been, at various levels
and points in time, confronted with a
with a sense of urgency to aftermath of the Arab Spring, which sense of urgency to diversify their still
diversify their still largely
precipitated significant shifts in the socio- largely hydrocarbon-dependent
political landscape of many Arab nations, economies. For the purpose of this paper
hydrocarbon-dependent as well as in the new light of more recent we have focused our analysis on the four
economies.
economic oil price shocks to national largest economies (GDP-wise) in the GCC
accounts, governments across the GCC as outlined in the figure below:
Figure 10: GDP and population analysis of the GCC
Nominal GDP
(USD billions)
800 756
2014 2016 Focus countries
700 646
600
500
403
400 349
300
206
200 163 152
114
81
100 66
33 32
0
Bahrain Oman Kuwait Qatar UAE KSA Focus
countries
% GCC share
Share of GCC GDP
2016 (%) 2% 5% 8% 11% 28% 45% 93%
Population
1.4m 4.4m 4.1m 2.6m 9.3m 32.3m 89%
2016 (millions)
Source: World Bank, Deloitte analysis
15Deloitte | National Transformation in the Middle East | A Digital Journey
The imperative to change has prompted a
The region will see the emergence of
“Government 4.0”, harnessing and
wave of national vision upgrades, the most
recent being the Saudi Vision 2030
applying the latest technologies and
unveiled in 2016, the New Kuwait 2035
vision launched earlier this year, as well as
solutions to modernize, centralize and
the Qatar National Vision 2030 and UAE
Vision 2021 visions established earlier13A.
While endeavours towards national visions
tend to follow a steady and incremental streamline government service delivery.
path over the long-term in other countries
and regions, the plans adopted by this
Governments, like businesses, will have to
group of hydrocarbon-rich nations in the
disrupt or be disrupted.
GCC are far bolder and more ambitious,
seeking to make substantive impact in a
This is most acute in the Middle East
five-year time horizon. Saudi Arabia’s
where the population base, especially in
National Transformation Plan 2020, UAE’s
GCC countries, rapidly adopted
National Agenda 2021, Qatar’s anticipated
smartphone devices, posting world
National Development Strategy 2017-
leading penetration rates and exhibiting
2022, and Kuwait’s Kuwait Development
some of the fastest digital media adoption
Plan (KDP) 2015-20 each represent
rates in the world in just a few years. This
massive modernization plans, which seek
consumer-led Digital Transformation
to accelerate economic diversification,
ultimately disrupted and completely
stimulate growth, foster sustainability and
changed the way citizens communicate,
unlock citizen happiness.
consume media and information, and
interact with governments across the
In doing so, these countries not only aim
region.
to secure a viable long-term future for
their citizens, but also build on their
Governments, including in the GCC, have
national competitiveness and credibility on
since learned from this and are now
the global stage. They seek to encourage
embracing Industry 4.0 – the next
foreign investment while continuing their
industrial revolution based on Digital
ascent towards becoming leading centers
Transformation. By placing new digital and
of knowledge, innovation and happiness.
ICT transformation programs at the heart
of their national plans, GCC governments
Digital Transformation: the critical
aim to reinvent themselves to better meet
success factor
the ever-changing needs not only of better
The most critical success factor in realizing
connected, informed citizens and
such ambitious visions is Digital
residents (G2C: Government-to-Citizen),
Transformation. As device penetration,
but also of businesses (G2B: Government-
connectivity and new technologies
to-Business), employees and other
continue to proliferate, the rate of
government entities (G2G: Government-
disruption in traditional business and
to-Government).
operating models intensifies.
16Deloitte | National Transformation in the Middle East | A Digital Journey
To this end, a number of ‘digital-ICT-first’ Plan 2020 (NTP), which highlights 29 As such, the region will see the emergence
sub-strategies and programs have already essential digital initiatives for key sectors of Government 4.0, harnessing and
been formulated. Notably, the UAE ICT as well as funding for national digital applying the latest technologies and
2021 Strategy and UAE National assets. The Qatar Digital Government solutions such as big data and analytics,
Innovation Strategy prioritize digital 2020 Strategy targets the efficient and IoT, blockchain, augmented reality (AR) and
technology as one of the top seven transparent delivery of government virtual reality (VR), artificial intelligence (AI),
national sectors, including the application services, supported by a world-class ICT drones, robotics and 3D printing, to
and rapid adoption of new disruptive infrastructure. Furthermore, Kuwait has modernize, centralize and streamline
technologies across sectors. Digital also revealed an updated e-government government service delivery, positioning
Transformation is also a top four priority in program. them as both innovators and disruptors,
Saudi Arabia’s National Transformation as opposed to disruptees.
Broadly in the Middle East, reports However, as highlighted in the previous
suggest that only 6 percent of the
section, on average, the GCC Digital
Government maturity level still lags behind
population lives under smart
a number of other developed economies.
More broadly in the Middle East, reports
governance. Governments including
suggest that only 6 percent of the
population lives under smart
those of the GCC have plenty of work
governance13B. Overall, governments
including those of the GCC have plenty of
to do.
work to do.
Figure 11: Cascade of national visions, plans and digital programs
GCC national visions and plans
Bahrain Oman Kuwait Qatar UAE Saudi Arabia
National
visions
Bahrain National Oman National
Planning Program for Enhancing
Development Economic Diversification
National
Strategy
plans
• e-government • ICT 2020 program • e-government • Digital Government • ICT 2021 strategy • NTP ICT programs
program (e.g. (e.Oman) program 2020 strategy • Innovation strategy (e.g. broadband
ICT and
national datacenter, • National ICT plan • UAE TRA strategy expansion, ICT
digital
government data • e-government 2020 human capital,
programs
network, smart card) strategy (Hukoomi) e-commerce)
Source: Official government websites and press releases, Monitor Deloitte research and analysis14
17Regional Digital Transformation agenda
Deloitte | National Transformation in the Middle East | A Digital Journey
Regional Digital Transformation agenda
Drivers behind Digital two important elements are required: - Modernization of other industries:
Transformation plans - Inclusion in plans: Digital sectors such as education, healthcare
Similar to other countries across the Transformation programs must be and tourism are also key to economic
world, Digital Transformation in the GCC’s recognized and prioritized as such diversification. These governments are
Public Sector is also driven by the same within national visions and plans already making significant investments
factors as alluded to in the previous in Digital Transformation efforts to
section: - Swift decisions: quick decisions from modernize these sectors and unlock
the top will push government entities growth
• Cost and budget pressures: since the to enact Digital Transformation plans
drop in oil prices in late 2014 that has quickly and effectively • Security: over the years, the region’s
now curbed the revenues of oil-rich governments have also been
GCC countries, there is an increased A good example of this is the H.H. Sheikh experiencing and combatting increasing
emphasis on curbing expenditures on Mohammed Bin Rashid Al Maktoum UAE levels of security threats:
government assets and operations. m-government directive in 2013 requiring
Cost-savings from more efficient government services to be available and - National Security: GCC governments
government processes are therefore offered via mobile within two years. This have seen an upsurge in conflict zones
a key driver behind new Digital promptly led to an explosion of over 300 surrounding their territories. National
Transformation programs. Not only do UAE mobile government services security and citizen safety remain a
such benefits improve governments’ developed and launched by various UAE priority, driving investment in state of
ability to improve their budget balance, government entities across the country the art digital security systems and
such cost-benefits also get passed onto within just 730 days15. solutions
customers and businesses.
In addition, the following region-specific - Cyber security: These governments
• Customer and citizen demand: the dynamics are also compounding the need have also become increasingly afflicted
emergence and popularity of social and urgency behind Digital by cyber-attacks. As national data,
media among Arabs has opened up a Transformation, especially in the GCC: assets and operations become
new channel, enabling governments and increasingly digitalized in the region,
citizens to work together. Governments • Economic diversification: as cyber security becomes ever-more
have actively exploited this as a key mentioned earlier, the GCC economies paramount. Recognizing this,
channel to obtain citizen feedback, as remain largely reliant on oil. Building a governments are investing in
citizens have also exploited this to viable future will require them to expand strengthening their cyber security
demand greater and higher quality their focus on other sectors and develop capabilities. In turn, improved cyber
government services (e.g. simplified new industries: security, not just in terms of improved
online payments solutions for utilities, online defense systems but also in
car parking, fines and toll gate credits). - Strategic focus on ICT sector: GCC terms of laws and regulations (e.g.
countries are already the largest minimum security measures, data
• “Federal” government directives: a spenders in the region on the ICT protection), will reinforce government
top-down approach to decision making sector, which globally is also enabling and stakeholder confidence in the
in GCC governments helps accelerate the birth of new technologies and continued digital advancement towards
the pace of Digital Transformation solutions behind Industry 4.0 Government 4.0.
programs, compared to more advancements. Focus and importance
consultative processes in other nations. on this industry is therefore a key
For Digital Transformation programs in enabler and driver behind national
the Middle East to get budget approval, Digital Transformation efforts
19Deloitte | National Transformation in the Middle East | A Digital Journey
• Mega events: although many programs Figure 12: Key digital initiatives under national visions and plans
have arisen out of a need to address
new challenges, significant investments National plans
in Digital Transformation programs are ICT and Digital Initiatives
also needed to enable as well as support
the successful delivery and management
Classroom of Next Generation Smart
of positive mega-events in the region
the Future Care Tourism
taking place over the next five years. Future Smart Smart
Namely the Dubai Expo 2020 and Qatar of Mobility Government Cities
2022 FIFA World Cup.
Key Digital Transformation initiatives Saudi Arabia Kuwait
Transformation initiatives do not only aim
to modernize governments, their reach 12 03 02 02
extends to entire industries, economies
and the way society functions at large
within these countries.
02 02 00 01
The first section looked at key future of 09 01 01 01
government trends (Gov2020) that were
most prevalent in the Middle East, and
clustered them as key regional themes: Qatar UAE
Classroom of the Future, Next Generation
Care, Smart Tourism, Future of Mobility, 04 04 08 09
Smart Government and Smart Cities.
These were based on expert views, market
research and interviews with key
03 04 04 04
government entities in the GCC.
05 04 04 03
These themes are at the core of the GCC
Digital Transformation agenda and are
explored in more depth in this section. Note: The above represents a sample of key digital initiatives, which is not exhaustive
Source: Official government websites and press releases, Monitor Deloitte research and analysis16
Figure 12 gives an overview of key Digital
Transformation initiatives across each
theme that have arisen out of new GCC
country visions, modernization plans and
‘digital-first’ programs.
20Deloitte | National Transformation in the Middle East | A Digital Journey
In the discussion that follows, this section 1. Definition
examines more closely the Digital 2. Key digital initiatives & outcomes
Transformation journey of these 3. Delivery method
governments while exploring the role, 4. Investment
progress and impact of some of these 5. Status
initiatives. As such, each theme is explored 6. Challenges & needs
in depth based on a seven step 7. Outlook
methodology:
Figure 13: Theme deep-dive content and study methodology
Content
Key digital
Delivery Challenges
Definition initiatives & Investment Status Outlook
method & needs
outcomes
Define the theme Highlight and Review how GCC Understand the Assess the level of Identify key Evaluate the
Description
in terms of how analyze key digital governments are scale of spend progress GCC challenges GCC future potential of
technology and initiatives in the approaching and and investment governments have governments are the theme in the
digital solutions GCC and the implementing involved to deliver made in facing once GCC and highlight
are addressing key desired outcomes digital initiatives key GCC digital implementing key implementing key opportunities
issues disrupting these initiatives (e.g. delivery initiatives digital initiatives digital initiatives based on the
the public sector seek to achieve models) theme’s analysis
Types of digital
Delivery models Indication of Progress
Theme definition initiatives & Deloitte outlook
used investment indicators
outcomes
Data
GCC challenges
and needs
Industry GCC GCC GCC GCC GCC
examples examples examples examples examples opportunities
Theme-Specifificc Study & Analysis
Scope
Saudi Arabia United Arab Emirates Qatar Kuwait
Inputs
Deloitte & Deloitte & Deloitte & Government Government
Theme-specific Theme research
Huawei Huawei thought Huawei subject interviews & visions, plans &
industry reports & analysis
experience leadership matter experts surveys data
21Next Generation Care
Deloitte | National Transformation in the Middle East | A Digital Journey
Next Generation Care
Definition Existing and new technologies are delivery, requiring large budgets to sustain
At its simplest, Next Generation Care is fundamental towards achieving Next operations.
characterized as: Generation Care (next-gen care), with
numerous examples of use cases that This, coupled with new economic
• Pervasive: accessible everywhere, include m-health apps, remote restrictions and other aforementioned
low-cost monitoring, ingestible data-generating IoT Digital Transformation drivers, has led to a
sensors, holographic and robotic assisted range of digital initiatives which not only
• Preventative: information and surgery, to name a few. aim to resolve public health issues as
awareness on vaccinations, pregnancies noted above, but also develop a world-
and healthier lifestyles Key initiatives and expected class next generation public health
outcomes service. This, in turn, stimulates innovation
• Efficient: real-time health checks, Healthcare remains a top concern for GCC and economic growth in the sector as a
diagnoses, health insurance claims governments, as citizens have been whole to support diversification. Through
processing and emergency services increasingly suffering from major public such next-gen care initiatives, GCC
health illnesses such as obesity, diabetes countries are also seeking to attract top
• Personalized: tailored to individuals’ and heart-disease. Providing care is also medical talent and tourists from abroad to
genetics or DNA, body-types, very costly as these governments offer develop their med-tourist markets.
preferential or other needs national health services as a state benefit
to citizens, employ a sizeable public health To this end, new digital initiatives of these
• Higher quality: less invasive and less workforce (doctors, nurses), own and governments broadly cover four main
painful for improved patient experience. operate many assets (hospitals and clinics) categories outlined in the figure below.
and have to effectively manage service
Figure 14: Key types of Next Generation Care digital initiatives
NEXT GENERATION CARE
Key Initiatives
1 2 3 4
Virtual and mobile Online preventative National e-health Health-tech
health services health systems innovation
Enable patients to access Digital awareness campaigns to Ongoing implementation of national Engage in R&D of ICT and new-
healthcare easily online and on- encourage health checks and electronic medical records and technology-based healthcare services
demand through digital devices healthier lifestyles integrated national health systems and solutions
23Deloitte | National Transformation in the Middle East | A Digital Journey
Virtual and mobile health services:
Saudi Arabia’s NTP plan is targeting
70% of all Saudi citizens to have a
These services enable patients to access
healthcare easily online and on-demand
unified digital medical record by 2020.
through their mobile devices, without
having to visit hospital facilities only to wait
in long queues to be served. Such services
also reduce the burden and costs on state
healthcare facilities by eliminating
unnecessary hospital visits by patients. • Electronic medical records: The Qatar’s updated National E-Health and
Similarly, telemedicine is another service process of centralizing patient data Data Program (QNeDP), formulated in
enabling access to wider pools of across the health system. For example, 2015, outlines a blueprint and set of
practitioners via consultations from UAE’s Ministry of Health and Prevention’s phased implementation plans behind the
remote locations over digital media. National Unified Medical Record (NUMR) integration of various national health
project (which started in 2016) aims to management systems (e.g. e-referral,
For example, Qatar’s Smart Healthcare centralize patient data and analytics for pharmacy, virtual medicine), health data
On-Demand initiative aims to offer new common use by all providers nationally systems, clinical repositories (e.g. clinical
services which include a digital self- streamlining diagnoses and treatments19. data, medication inventory) and external
diagnosis platform (based on algorithms Qatar’s Single Patient Record project (a consumer systems (e.g. patient medical
to process step-by-step digital checklists unique national patient record system) records and accounts, population health
pin-pointing various symptoms for seeks the same20. Saudi Arabia’s NTP systems)22.
patients), Doctor Finder, an appointment aims to expand its efforts to digitize
service, and virtual doctor consultations patient data, targeting 70 percent of all In the UAE, the Emirates ID and health
through telemedicine (enabling patients to Saudi citizens to have a unified digital insurance services are also integrating,
connect to doctors via online video chat medical record by 202021. enabling residents to use their Emirates ID
with digital transmission of medical as a national health insurance card across
imaging and health informatics)17. UAE’s • E-integrated national health the country, whilst also expanding data on
Abu Dhabi Telemedicine Centre also systems: connecting different the national citizen database23. The
provides a similar service with a free healthcare ecosystem players (e.g. Mabrouk Mayak service by the UAE
mobile application allowing patients to patients, practitioners, hospitals, clinics, Ministry of Health and Prevention
remotely share photos assisting their pharmacies, test labs, investors, (MOHAP) is another good example. It
diagnosis (e.g. photos of an affected area regulators) to provide a seamlessly enables rapid completion of all
of the body, medication labels)18. connected experience for all, certifications for new-born Emiratis (e.g.
representing a key step in digitally birth certificate, ID card, passport) by
National e-health systems transforming GCC countries’ health reducing required interactions and visits
Key initiatives include the ongoing systems. from seven different government entities
implementation of national electronic to just one24.
medical records and integrated national
health systems:
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