The discourse has evolved drastically in the past year, moving from discussing the potential benefits for state and local government to focusing on the “how.” How can our department effectively incorporate this technology to enhance the well-being of our constituents? How best to go about implementing the technology? What resources do I need? While governments have traditionally relied on the private sector to pave the way, troubleshoot issues and identify potential pitfalls, state and local governments are now among the early adopters of GenAI, with some agencies moving ahead despite not having GenAI in their existing budget.
While still in the opening chapters of implementation, it's important for leaders to get ahead of potential issues to help lay the groundwork for successful GenAI adoption. Here are three key considerations for agency leaders to keep in mind:
BE CONSCIOUS OF COSTS AND ANTICIPATE BUDGETARY NEEDS
There is a well-known saying, "show me your budget, and I'll show you your values." Integrating GenAI solutions into existing agency software will likely necessitate budgeting and allocating funds for these solutions. One of the initial considerations is whether these charges will be incurred at the state or department level.
However, accurately calculating the costs can be a significant challenge. To estimate licensing expenses and prevent unnecessary fees for users who do not require specific GenAI functionalities, leaders must meticulously identify and track which use cases should have access to which sets of GenAI functions. Implementing GenAI may also involve renegotiating software licensing contracts.
EMPHASIZE PRACTICAL APPLICATIONS, NOT THE TECHNOLOGY ITSELF
While having a general understanding of the technology is important, it is even more crucial to recognize that the implementation of GenAI revolves around specific use cases rather than the technology itself. Technology is never adopted just for the sake of technology; it is always intended to drive business outcomes and contribute to the agency's mission in some way.
The challenge lies in aligning or adapting a provider's technology to meet the unique needs of the agency. This gap between what technology providers offer and where GenAI can truly enhance agency performance and productivity adds complexity to the decision-making and implementation process.
By embracing GenAI technology to address common and immediate challenges, agencies can establish a solid foundation for future applications, such as vendor management, legal processes and procurement. This approach allows agencies to gradually expand their utilization of GenAI and explore more innovative possibilities in the future.
CONCENTRATE ON THE RELEVANT OBSTACLES
It is evident that this technology holds immense potential for agencies, ranging from enhancing employee efficiency and effectiveness to increasing job satisfaction by making work more engaging. GenAI can also empower agencies to offer new and improved services or gain insights that were previously elusive.
With such promising prospects, it becomes crucial to carefully consider and address the potential pitfalls. How do you choose the right technology provider? What capabilities should be enabled? What training will be necessary? How do you evaluate data sources? The questions can seem endless which is why focusing on and managing AI-related risks and challenges is critical to ensure agencies can derive the most from their GenAI solutions.
David Pondillo, Principal, Health and Government Advisory, KPMG LLP
Rob Breakiron, Managing Director, State and Local Government Advisory, KPMG LLP
