The growing adoption of artificial intelligence (AI) in solutions promises many advances for the public sector, but cities and counties must take precautions to safeguard service delivery and public funds as market commentors are comparing AI trends to the dot-com era.
History has taught us that with any tech advancement that creates rapid demand and an influx of new entrants, over-excitement about the value of the market grows. New providers, fueled by investment, rush visionary solutions to market without adequate market insights, testing, or long-term viability. All this creates the perfect storm, where sharp re-valuations create ripples across technology markets at best, a full bubble burst at worst.
The potential of AI supported solutions should not be underestimated, it has significant potential to remove administration barriers and fine-tune public sector services, but knowing what you are getting is critical to avoid the risk of any market fallout.
Tech Advancements and the Public Sector
The public sector has traditionally seen slow uptake of the latest technological advancements, yet AI has caught the imagination of many cities and counties, especially with funding grants available to advance government services. The world is becoming increasingly digital, so AI has offered a vision to increase efficiency for public sector services.
From online agents and digital guides for citizens applying for services, to tools for removing administration tasks in delivering those services, the promise of AI-enrichment is an apparent and thrilling opportunity, but will it live up to the hype?
In short, yes. The technology offers extensive possibilities, but only if it is applied with guardrails, especially for local governments’ public funds. Before you dive into investing in AI capabilities, make sure you plan for the future and reduce risk.
Guide to Local Government AI Investment
The sector is awash with AI promises and discussion of potential impact, making decisions on what to invest in more difficult. Which AI features to implement first or what will offer longevity is not always clear, so use this checklist to ensure that the investment you make today will still benefit you in the years ahead.
1. Put security first.While local government focusing on security seems obvious, what to look for is not always clear. Verifying that providers have the necessary security credentials is critical to prevent system cyber vulnerabilities and protect your data. Look for vendors with SOC 2 Type II and ISO compliance and ensure AI infrastructure comes from established cloud providers like Microsoft Azure as they maintain enterprise-grade security standards, conduct regular audits, and have the resources to respond quickly to emerging threats.
2. Evaluate the infrastructure behind the AI.Any AI functionality should be underpinned and built using robust AI infrastructure, not only for security but also reliable delivery. Avolve, for example, has built the AI functionality within its plan review solutions on Microsoft Azure OpenAI, ensuring uptime, collaborative support for AI expansion, and robust functionality. Always check which AI model is powering the service you are purchasing—as this choice directly impacts long-term safety and success.
3. Prioritize industry experts.Be wary of new entrants with limited sector knowledge. You’ll be investing significant time building out systems that do not meet the requirements of the unique demands of the public sector. Look for vendors who are building AI features within existing systems and processes, to ensure that AI addresses real bottlenecks and delays. This also keeps expert systems in a single tech stack, reduces the need to toggle between non-integrated tools and limits data silos, as extra steps create more inefficiencies than they solve.
4. Verify vendor longevity and reliability.The biggest question for any investment — will the provider that you are considering be here in two years’ time? How about five years? Spending public funds and investing time and people resources in a system that might not be here in a few years is a huge risk. Look for vendors with proven revenue streams, established customer bases, and sustainable business models. Examine their client retention rates, customer endorsements, and product release cadence. Avoid those whose business model depends on an AI vision – instead, choose partners who have built AI capabilities on top of established solutions that serve real market needs.
Should you invest in AI now?
The answer is yes. The technology's potential for local government is enormous, and it can deliver meaningful benefits to local government services. The most successful AI features will be those that augment human expertise rather than replace it. Government services require nuance, judgment, and accountability that AI-enriched solutions can enhance but not eliminate. The goal isn't fewer people — it's empowering your team to deliver better citizen services.
The approach must be intentional. Choose solutions designed for your specific challenges rather than retrofitted from other industries, or putting too much emphasis on AI functionality, rather than the underpinning process. At Avolve, we draw on insights from our 350+ local government customers to solve the daily challenges and inefficiencies that create bottlenecks and delays in the plan review process.
As you evaluate AI features to support your local government services, ensure any vendor has a robust long-term, detailed roadmap for the development of their solution.
Do not shy away from the possibilities that AI-enrichment can deliver but do take steps to avoid any fallout from a potential AI bubble burst – evaluate thoroughly, invest thoughtfully, choose intentionally, so you can build for long-term success.