In the last two decades, information and communication technology (ICT) has become the new DNA of society. The internet revolution and its adoption in the governmental sector had a great impact on the various aspects of how citizens and businesses interact with the government, resulting in new types of services, namely electronic government, or e-government. According to the United Nations (UN), e-government can be defined as the use of ICTs to deliver government services more effectively and efficiently to citizens and businesses. The underlying principle of e-government is to improve the internal workings of the public sector by reducing financial costs and transaction times to better integrate workflows and processes. Through this innovation, governments worldwide can be more inclusive and provide better services as a response to citizens’ demands for transparency and accountability.
If we were asked which country has the best e-government, we would most certainly say Denmark or Estonia. These Nordic and Baltic countries sit atop in almost every report and survey on public sector digitalization. Among the numerous notable recognitions of Denmark’s outstanding performance in e-government is the UN’s #1 ranking in the E-Government Development Index in 2018, 2020, and 2022, as well as the highest number of citizens using e-government services in the entire European Union, with 93% of Danish internet users using digital public services in 2021. Meanwhile, according to the 2022 Digital Economy and Society Index by European Commission, Estonia is the best performing country in the sector of digital public services, and it is recognized as a leader in e-government, outperforming Central and Eastern European countries.
Government Pillar Comparison Based on the UNDP Digital Readiness Assessment
In the government pillar of the UNDP Digital Readiness Assessment framework, the Digital Development Compass classifies both Denmark and Estonia in differentiating stage, which entails being institutionalized in administrative acts and decision-making processes. Denmark has achieved a score of 5.67 in the Digital Public Services sub-pillar, placing it in the transformational level. Estonia, meanwhile, has a little higher score—5.94—and is likewise in the same level.
The excellent scores Denmark and Estonia received in that report are not coincidental. The two countries have carefully and precisely defined their digitalization goals and have pursued them. To develop a wide range of efficient and well-integrated digital public services, they have supported digital innovation, enacted laws to promote the adoption of digital services, educated the public, and engaged in public-private partnerships. These developments have resulted in significant infrastructural solutions that benefit all citizens and businesses in their daily lives when interacting with the government. In the same way that Denmark has borger.dk, Estonia has eesti.ee as an integrated public service portal, both of which are available 24/7 and protected against high demand. This robust government service delivers a superior citizen experience by meeting the four core tenets of user needs by Aarron Walters: functional, reliable, usable, and pleasurable (Queue IT, 2023).
The Digital Journey: Relationship with the Public and the Private Sector
In Denmark and Estonia, digitalized public services were introduced in a way that purposefully reflected the state’s interaction with the public and private sectors. The two countries have had clear and deliberate digitalization goals in place for over 20 years. These goals set the foundation for Denmark and Estonia to become global leaders in digital government. In general, both countries have taken the same actions. First, they made sure the public could use digital technology more easily by educating them about digitalization. Second, by committing to digital administration, they intend to modernize outdated systems and provide citizens with efficient and effective digital public services. Third, by incorporating the internet into their democratic and cultural activities, they achieved not only top-down political changes, but also citizen-centered cultural transformations (The CBO Insight, 2015).
According to the Danish Agency for Digital Government, Denmark’s central, regional, and local governments have collaborated strategically since 2001 to set the groundwork for the future digital public sector. The initial step was implementing digital collaboration in the public sector through digital signatures and emails in 2001, followed by effective payments with NemKonto (bank accounts) and e-invoicing in 2004. After that, in 2007, NemID/EasyID (ID used for public self-service), Digital Post, and the borger.dk portal were launched, followed in 2011 by Digital Post for Business. Then, in 2016, high-security public data sharing started, and by 2022, Artificial Intelligence (AI), automation, and green transition regulations are in place.
The Danish Agency for Digital Government believes that ‘usability is king’. The government understands no matter how open the public is to e-government technologies, they will not use them if they are not convenient and easy to use. As a result, the Danish government is attempting to make e-government more appealing than its non-digital predecessors. One way they accomplish this is by expanding the range of situations in which technology can be used. As a result, the NemID can be applied to confirm every government transaction and electronic banking. Similarly, the Digital Post system would provide secure storage for any correspondence and data sent between a person and any public agency, making it significantly more user-friendly than paper-based alternatives.
As for Estonia, since regaining independence in 1991, the government has sought to redesign the nation’s entire information infrastructure with goals of openness, privacy, and security. Reporting from e-estonia.com, this country’s journey to become the world’s most advanced digital society is told as follows. Since the first draft of The Principles Estonian Information Policy in 1994, this country has made rapid progress in the provision of e-government. The Tiger Leap Initiative and e-Banking Services were established in 1996. In addition, e-Cabinet Meeting, e-Tax Board, and m-Parking were created in 2000. Estonia also developed X-Road in 2001 to create a national integration platform to minimize data interchange costs and stop data leaks from existing unprotected systems. e-ID and digital signatures were introduced in 2002, followed by the launch of e-Voting in 2004 to make elections more accessible. Following a serious cyber-attack on Estonia in 2007, cyber security was enhanced, and blockchain technology was deployed in 2008. This country also pioneered e-Health (2008) and e-Prescription (2010) in the health industry. After that, in 2014, the e-Residency was established to attract foreign business and talent to Estonia, followed by the Road Administration’s e-Portal the following year. During the 2019-2020, this country created legislation on Government AI Strategy, Proactive Childcare, and Remote Notary Verification.
The Estonian government realizes that giving benefits to society will increase the adoption of governmental services through digital channels, hence they established the integrated portal eesti.ee in 2013. When it comes to e-services, Estonia has a relatively high adoption rate. According to e-estonia.com, by 2022, more than 98% of Estonia’s 1.3 million citizens have an e-ID, 100% of schools and government organizations are ICT equipped, 97% of businesses use computers, 100% of bank transfers are performed electronically, 98% of income tax declarations made via the e-Tax Board, and 99% of medication is bought with a digital prescription.
Collaboration between the public sector and the private sector was also a crucial success element in Denmark and Estonia’s e-government journeys. When Denmark launched NemID, it became available to all Danish banks and e-commerce businesses. With NemID, the government also provides a pan-public sector ‘basic data’ set of core property and demographic information that is publicly available to the private sector to foster data-driven enterprises and encourage new industries. Similarly, when designing an e-invoicing solution, NemHandel, the Danish government ensured that it could be used for business-to-business invoicing to save large amounts of administrative costs. Meanwhile, in Estonia, the government collaborated with the private sector to develop The Estonian IT Academy in 2012 to address any potential ICT skills gap. The Estonian government cooperated with local companies such as Cybernetica, Guardtime, and Signwise to deliver the core e-government components. These businesses are now exporting their expertise, services, and products abroad in collaboration with the Estonian government (The CBO Insight, 2015).
What We Learned from These Nordic and Baltic Countries
In conclusion, Denmark and Estonia are excellent examples of how a country can achieve success and become the world’s best e-government. Both countries establish a defined plan for ‘mediated self-service’ at the start of any e-government program. They adopt the ‘usability is king’ principle in the digital public service, allowing the customer experience to define the process rather than allowing the existing process to define the customer experience, and set the success criterion that every e-government offering should be more convenient and useful than its (non-digitized) predecessors. Another lesson that can be taken is that the public sector should work with a cross-section of industry to explore how the digitization of government services can make the jurisdiction more attractive to the private sector and foster new industries.
The stories of Denmark and Estonia provide important practical instances of how digital transformation in government may be successful. The digital journeys of these Nordic and Baltic countries give valuable insights regarding the move from analog stasis to digital growth within the public sector. After all, the wave of governmental digital transformation should be about more than just surviving—it should be about thriving.