Sustaining change

An interview with Dr. Pramod K. Varma

In the context of digital transformation, what does sustainability mean to you?

For me, digital transformation becomes ‘sustainable’ when the majority of citizens can adopt—and in fact, embrace—internet-era public services. But every nation goes through different phases to reach that point. 

First, a relatively small group of people adopt internet-era public services. They are followed by an ‘early majority’, and later by the ‘late majority’. At this point, change is in the DNA of the country and has been universally adopted. 

Digital transformation needs to be thought about differently at each of these phases. In India, we’ve seen that phase 1 tends to take around 3 years; phase 2 takes another 3 to 4 years, and late majority adoption happens between 7 and 10 years. India has a population of 1.3 billion and we have extreme diversity in wealth, education and spoken languages (there are 22 official languages and many variations). It’s not surprising that each area of transformation is in a different phase. 

For example, around 10 years ago we began to transform how we deal with digital identity and financial inclusion and this area is very widely adopted. But we’re not there with education and health yet.

What are the foundations for sustainable digital transformation?

There are 3 enablers for sustainable digital transformation. They are:

1. Digital-era institutions. This includes institutions, laws, regulation, funding to create an institutional environment conducive to sustainable digital transformation.

2. Digital technology building blocks. Teams need to identify and design the minimum set of ‘building blocks’ they need to begin transforming public services and solving societal challenges. (India’s digital technology building blocks include the biometric identity system Aadhaar, the online electronic signature service eSign, and Digilocker, the cloud-based platform for storage, sharing and verification of documents).

3. Digital innovation incentives. This includes mechanisms to incentivise all the main actors in the digital ecosystem to take part in their country’s digital transformation. If you don’t have an ecosystem that continuously innovates and evolves, it stagnates and you are forcing transformation. This won’t be sustainable.

Who are the main actors behind sustainable digital transformation?

There are 3 main parties involved in digital transformation: the government, the private sector and civil society. A big challenge is making sure all are engaged and participate appropriately. In theory, transformation is possible if just the government and the private sector pushes it forward, but the change wouldn’t be sustainable. 

Governments tend to do the minimum, and private actors are interested in generating revenue which means they are rarely interested in the long term. However, the civil society actors are the eyes and ears of society. They are researchers studying social impact, organisations representing the vulnerable and the citizens themselves. They play an essential part in sustainable transformation in terms of inclusion. 

In India, there were several incidents where families were excluded from food delivery. Civil society discussed this publicly and in doing so, it effectively held the government and private sector to account. A similar thing happened with our digital identity work when societal actors put pressure on the government to refine and define the contours of the project—there was a great deal of debate around privacy.

Give an example of sustainable digital transformation

In the early phases of innovation, I don’t think government digital teams should overburden themselves with sustainability questions. Because there’s no guarantee that innovation at scale can play out, they need to move rapidly and think like a start-up. 

They can consider sustainability a great deal during the mid and later phases. So it’s important that the environment in which people innovate has the right policies and technology building blocks in place to enable sustainable digital transformation from the start. A good example of this is Unified Payments Interface (UPI).

UPI is an interoperable payment system developed by National Payments Corporation of India (NPCI) which allows real-time money transfer between banks, wallets, people, and merchants.

UPI was launched under the Payment and Settlement Act, it had the Central Bank of India’s full blessing, and was incubated with the not-for-profit National Payment Corporation of India which has the mandate to run payment infrastructure. In short, UPI was developed responsibly with sufficient safeguards to guarantee the protection of its users. 

As a result, many actors used UPI as a building block to innovate on top of it. More than 10 Indian unicorns created new services such as online vouchers, bill payment solutions, personto-merchant payments, and UPI-based ATM. It was a key enabler of sustainable digital transformation.

What role do open source and protocols play in sustainability?

All countries are different in terms of their digital maturity, institutional environment, societal or economic landscape, but in terms of moving forward with their digital transformation, they all benefit from the same things: open source software, content, data sets, protocols and even platforms. They are context free. They represent the highest common denominator in digital building blocks. Digital public goods are critical to massive adoption of innovation and change. We must share them, feed into them and maintain them.

But we can go further than sharing digital public goods through the adoption of common protocols. A protocol consists in a common language that enables interoperability between different platforms. For example, emails rely on protocols like SMTP, POP and IMAP. 

These protocols allow us to receive and send emails with people, whatever solution they use. If we had protocols for messaging solutions, we’d be able to send a message from Whatsapp to Signal, Telegram, Slack or Messenger. But since the 2000s, the digital industry has been moving way too fast and creating walled gardens without interoperable protocols—governments haven’t yet seized this issue.

However, protocols offer great potential by allowing different platforms to communicate. For example, in India we’re rolling out universal health insurance where an open network of health and wellness platforms are being connected to the common grid through open protocols. There’s an effort to create an open network for decentralised commerce through interoperable protocols, and in the city of Kochi, an open mobility network has been created where mobility platforms and apps can create a unified network.

Lots of progress has been made, however, it’s hard to create protocols in areas where large incumbents defend their own commercial interests. But we need to continue to create open source protocol communities and we can leverage nascent and vibrant startup communities as well as think tanks and volunteers, who are far better placed to serve the interest of the greater number.