What's Happening?
Local governments are increasingly integrating artificial intelligence (AI) into their operations, particularly in areas like permitting, inspections, and plan review. However, the rapid expansion of the AI vendor landscape, characterized by numerous
startups and overlapping products, mirrors past tech bubbles. This has led to concerns about the sustainability and return on investment of these technologies. Despite significant enterprise AI investments, a Massachusetts Institute of Technology (MIT) study found that 95% of organizations report no measurable returns. Local governments are advised to partner with proven vendors that offer stability and public-sector expertise to ensure long-term success and avoid disruptions if vendors exit the market.
Why It's Important?
The integration of AI in local government operations holds the potential to streamline workflows and improve efficiency in both front-office and back-office tasks. However, the risk of investing in unproven AI startups could lead to financial losses and operational disruptions if these companies fail. By choosing stable vendors with a track record in the public sector, local governments can safeguard their investments and ensure that AI tools are effectively integrated into their systems. This approach not only protects financial resources but also ensures continuity in service delivery to citizens.
What's Next?
Local governments are encouraged to adopt a workflow-focused evaluation framework when selecting AI vendors. This involves assessing the vendor's public-sector experience, system integration capabilities, and long-term reliability. By doing so, agencies can modernize their operations safely and sustainably, even as the AI market continues to evolve. Additionally, defining key performance indicators (KPIs) prior to AI implementation can help measure the value and effectiveness of these technologies, ensuring that they meet the specific needs of government operations.
