Artificial Intelligence Implementation in Public Sector - Government: Challenges, Risks

and Strategies

Wahyu Hidayat Halimun Syah

(wahyuhidayat36@gmail.com)
Rudy M. Harahap
(rmharahap@gmail.com)

Abstract
Government, as a public sector must provide the best service for societies. To achieve that
goal, government need strategic management to level up their performance. Innovation is
needed to improve their performance so that they can give the best service for societies.
Artificial Intelligence (AI) is a kind of technological development in this era. AI can enable the
development of valuable services for citizens, businesses, and public sectors, in multiple
domains, such as transportation, energy, healthcare, education, and public safety.
Keywords: technology; artificial intelligence; computers; government; public sector;
management.

1. Introduction
Artificial intelligence (AI) is the programming of computers to do tasks that would normally
require human intelligence. This includes the ability to understand and monitor visual/spatial
and auditory information, reason and make predictions, interact with humans and machines,
and continuously learn and improve (Mehr, 2017). Furthermore, AI applications refers to the
integration of AI technology into a computer application field with human – computer
interaction and data interaction.
Al becomes powerful with machine learning, where the computer learns from supervised
training and inputs over time to improve responses. One scenario in which machine learning
could become valuable in a government context is when there is a mass of data but not enough
people to manage it or experts to analyze it. Another scenario would be routine processes that
a machine can automate while improving over time. Through these applications, AI can reduce
administrative burdens, help resolve resource allocation problems, and take on significantly
complex tasks (Mehr, 2017).
AI technologies can be applied in key areas of government mainly to improve the efficiency
of governance and the quality of life of citizens (Chatterjee et al., 2018). AI applications can
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be used in many significant areas, such as public transportation, healthcare, public safety,
defense, social and cultural, industry and trade sectors. (Kankanhalli, Charalabidis & Melloui,
2019).
Despite the benefit using AI, AI will face some future issues, such as AI remain bounded
by government resources and the limits of both human creativity and trust in government. AI
will not solve systemic problems in government, and could potentially worsen issues around
service delivery, privacy, and ethics if not implemented thoughtfully and strategically.
Agencies interested in implementing AI can learn from other sector, for example private-sector
implementation of AI.
Until 2018, AI's popularity increased very sharply. This indicates that the world has begun
to consider the use of AI in their business. The government as an entity engaged in public
services and policy makers will benefit greatly from the development of AI. However, in the
implementation of AI itself, the government will be faced with some problems as described
before. AI's popularity can be shown in the figure below (Google Trend, 2019).

Figure 1. Popularity of Artificial Intelligence from 2014 – 2019

In this paper, the author first will explore the research, challenges, risks, and strategies
involved in implementing and adopting AI technologies in the govenment. Next, the author
will mention some of current AI projects in the various countries and citizen’s perspective
around the world about AI implementation in government. And in the last section, the author
will compare the strengths and weaknesses between human and AI in decision-making
capability. This research is a literature review and did not receive any specific grant from
funding agencies in the public, commercial, or not-for-profit sectors.
2. Research of AI in The Public Sector
Commercial applications of AI have attracted the majority of the research interest. However,
empirical research on AI in the public sector is still rare. The most surprising thing is that the
implementation of AI has been running in several areas, the author gives an example about AI
implementation in the Australian Tax Office where they use chatbots to help citizens with

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questions related to taxes, which contributed to an increase of first contact resolution rate to
80%, exceeding the industry benchmark of 60–65% (Nuance Communications, 2016).
The little existing empirical research on AI in the public sector has focused on AI's
capabilities to transform the workforce. Impacts of the use of AI on the work of the public
sector have been categorized into four areas: relieving, in which AI takes over mundane tasks,
and relieves public workers for more valuable tasks; splitting up, where AI helps to break up a
job into smaller pieces, and takes over as many as possible of these, leaving humans do the
remainder; replacing, where AI carries out an entire job performed by a human; and
augmenting, where the AI technology makes workers more effective by complementing their
skills (Eggers et al., 2017).
AI is different from the existing automation technology because it does not make decisions
on previously programmed logic, where the same input instructions produce exactly the same
results. Instead, AI goes a step further by showing some learning abilities (Russell & Norvig,
2016). AI thus represents, in principle, ideal technology to be applied to the context of the
public sector, where environmental settings are constantly changing, and pre-programming
cannot explain all possible cases.
AI researches in the public sector is still in its early stages and still in the idea of what effects
are expected from the implementation of AI itself, that so far are mostly speculative in nature.
It would be very good if the results of these researches are able to provide convenience for the
implementation of AI in the public sector.
3. Challenges of AI in Public Sector
The application of AI in the public sector certainly presents many challenges in its
implementation. These challenges must not be ruled out because they can prevent the
implementation of AI in the public sector. Generally, there are four main challenges in
implementing AI in the public sector, i.e. AI technology implementation, AI law and
regulation, AI ethics, and AI society (Wirtz, Weyerer & Geyer, 2018).
AI technology implementation. As explained earlier, AI has developed very rapidly in the
last decades. So far, AI is used mostly in private sector. That kind of thing will be a challenges
or problems in implementing AI in the public sector. Different kinds of services and types of
stakeholders can make the implementation different in the public sector or the private sector.
Things that can prevent the implementation of AI in the public sector are AI safety, system/data
quality and integration, financial feasibility, and specialization and expertise.
AI law and regulations to control and governance. AI law and regulations refer to the
general governance of AI and thus concern the overall ability to manage and control AI
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technology and its social and economic impact. Due to the broad scope of application, the
governance of AI is associated with a variety of legal and regulatory issues, pertaining to data,
algorithms, infrastructures, and humans (Gasser, 2017).
AI ethics. An intensely discussed challenge in connection with AI applications in the public
setting refers to the ethics of AI. Major ethical aspects of AI refer to the field of robot ethics or
machine ethics. On the one hand, this includes considerations whether the development and
use of certain AI applications and their consequences are ethical and morally justifiable
(Patrick., Abney, & Bekey, 2012; Russell, 2015). There are three challenges of AI ethics cover
a broad spectrum of aspects, ranging from AI rulemaking for human behavior, to the
compatibility of machine versus human value judgment, to moral dilemmas and AI
discrimination.
AI society. AI society refers to the transition of social life and human interaction driven by
AI and the social challenges associated with these changes. AI has reached the everyday world,
influencing our daily routines and many core areas of society, such as healthcare,
transportation, and finance (Cath et al., 2018). At the same time, there are also increasing
concerns about AI’s future development and diffuse anxieties emerging in society due to its
potentially adverse effects on mankind and society (Johnson & Verdicchio, 2017).
4. Risks of AI in Public Sector
Besides there are many challenges in implementing AI in the public sector, implementing
AI is also faced with several risks that may occur. This is inseparable from the fact that AI is a
machines, not a humans. A lot of stigma emerged that public sector policies or jobs must be
carried out by humans, not machines. In addition, in its implementation, AI itself is bounded
with security risks from stored data. Hence, in the implementation of AI will cause problems
of public trust in the government. Risks is also can occur if the humans as user do not fully
understand about the AI systems. Furthermore, there is a possibility that the AI decision is
different from the human decision can increase the risk of AI implementation. There are three
major risks that can be happened from implementation of AI. They are the risks of AI
dominance of media discourse, the risks of economic chaos and the transformation of work,
and security and existential risks. (Boyd and Wilson, 2017).
The risk of AI dominance of media discourse. Human rationality is bounded. Humans are
subject to biases and heuristics of thinking that control the information they believe and may
confound our best intentions (Gigerenzer, 2008; Kahneman, 2011; Richerson and Boyd, 2004).
This means that our psychology is exploitable.

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 Our psychology is already exploited by advertising, propaganda and rhetoric. Connectivity
and digital platforms make it much easier to share and spread information. Psychological
exploitation is possible on an unprecedented scale with the help of intelligent machines
exploiting the structure and function of social media and vast data sets (Boyd and Wilson,
2017).
Now let’s imagine what will happen when AI dominate the media discourse. There are so
many aspects that can be influenced with that. Public perception about government, wrong
public policy formulation, even can lead to domestic war. If the AI systems of interest groups
become proficient at exploiting patterns of cause and effect we are not even aware of, reality
may recede in a storm of artificial content while we remain oblivious to our own manipulation
(Woolley and Howard, 2017).
The risks of economic chaos and the transformation of work. Many reports detail mass
unemployment due to automation. There is a risk that present systems will become unfair with
the arrival of AI.
Another risk is about transformation of work. AI could ultimately lead to loss of meaning
as human work is replaced by robots (Nauman, 2017) and they voluntarily submit, letting
algorithms rule our lives (White, 2015).
In public sector, the focused problem is not about unemployment. The focused problem is
employee’s dependency to AI. In one side, AI implementation is good because machines can
help human’s work and make it easier and more efficient. But the other side is, AI
implementation will make employees lazy and dependent on machines.
Security and existential risks. In public sector, existential and security risks emphasize at
risk that can occur from AI programming. Before programming AI application, first
government have to answer these simple questions, “Do we really need AI for these tasks? Do
we have to let machines do these? Or can we do these by ourselves?”. After answering those
questions and having adequate conviction that the government must program it and finally they
make it, the next question is what security risks might happen from it. These security risks can
be data hacking, program malfunction or program failure.
5. Strategies for AI Implementation in Public Sector
Despite the AI implementation risks, government can develop strategies that can be done to
succeed the implementation of AI in the public sector. Everybody knows that government’s
work is depend on citizen satisfaction. That is the main goal of implementing AI in the
government, to satisfy the society. Furthermore, everything related to government policy must
be based on citizen satisfaction.
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 Fred R. David in Strategic Management : A Competitive Advantage Approach Concepts
(2016) explained that technological developments, including AI, can influence the role of
management in developing further strategic management. This is because AI can help the
policy analysis process, simplify complicated analysis and formulate alternative solutions
about such problems. That is why government need to formulate strategies that can help
implement AI in the government.
There are six strategies that can be applied in implementing AI in the government. They are:
make AI a part of a goals-based, citizen-centric program; get citizen input; build upon existing
resources; be data-prepared and tread carefully with privacy; mitigate ethical risks and avoid
AI decision making; and, augment employees, do not replace them (Mehr, 2017).
Make AI a part of a goals-based, citizen-centric program. AI should not be implemented in
government just because it is a new, exciting technology. Government officials should be
equipped to solve problems impacting their work, and AI should be offered as one tool in a
toolkit to solve a given problem. To solve a given problem, government office should consider
citizen’s satisfaction (Mehr, 2017).
Get citizen input. Citizen, as a part that affected by the policies of the government, should
be involved in planning AI. Citizen can offer other ways to be involved with AI, and even help
co-create ethics and privacy rules for use of their data. When it comes to building and spreading
AI platforms, user feedback is essential both from citizens and government employee users.
Build upon existing resources. Government should focus upon existis resources. Making
new systems does not mean that they have to build from zero. Even though much evolution in
AI has come from early government research, governments can also take advantages of the
advances businesses and developers are making in AI.
Be data-prepared and tread carefully with privacy. When government offices intend to
improve their data collection about society and management, best practices about the type of
data that will be used and collected will be critical for future use with AI. Governments should
also be very transparent about the data collected and give citizens the choice to agree or
disagree when their personal data will be used.
Mitigate ethical risks and avoid AI decision making. AI is susceptible to bias because of
how it is programmed and/or trained, or if the data inputs are already corrupted. AI should not
be used with making critical government decisions about citizens. For example, the use of a
risk-scoring system used in criminal sentencing and similar AI applications in the criminal
justice system were found to be biased.

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 Augment employees, do not replace them. AI may instead lead to increased and new
employment directly and indirectly related to AI development and supervision. Because of that,
AI works best in collaboration with humans. Any efforts to incorporate AI in the government
should be approached as ways to augment human work, not to cut headcount.
6. Citizen’s Perspective on the Use of AI in Government
The citizen’s perspective is important to measure the extent to which role of AI is needed in
supporting government performance. By knowing the perspective of citizen, the government
can easily map what AI is expected by its people. Moreover, in the development of AI exploit
public money so that they have the right to know what programs are being developed by the
government.
The next thing is how citizen’s viewpoint when some public tasks are taken over by
computers. Do they feel comfortable or protest with that policy (using computers instead of
humans). This is important because it involves harmonizing the citizen and the government.
Then, what impact can be happened from the AI implementation. AI implementation is
expected to increase employee productivity. This increase in productivity will be able to impact
on improving citizen's welfare.
To gain insights into citizen’s attitudes about and perceptions of the use of AI in
government, BCG had surveyed more than 14,000 internet users around the world as part of its
biannual Digital Government Benchmarking study. And the result is most respondents
indicated they would support AI implementation in government, but there are some exceptions
that they disagree about implementing AI in the public sector. Detailed explanations are shown
below.
 Citizens were most supportive of using AI for tasks such as transport and traffic
optimization, predictive maintenance of public infrastructure, and customer service
activities. The majority did not support AI for sensitive decisions associated with the justice
system, such as parole board and sentencing recommendations.
 People in less developed economies and places where perceived levels of corruption are
higher also tended to be more supportive of the use of AI. For example, the citizens surveyed
in India, China, and Indonesia indicated the strongest support for government applications
of AI, while the citizens surveyed in Switzerland, Estonia, and Austria offered the weakest
support.

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 Demographic patterns tend to mirror general attitudes toward technology. Millennials and
urban dwellers, therefore, demonstrated the greatest support for government use of AI, while
older people and those in more rural and remote locations showed less support.
 Citizens were most concerned about the potential ethical issues, as well as lack of
transparency in decision making, and expressed significant anxiety about AI’s potential to
increase automation and the resulting effect on employment.
7. Current AI Projects in Public Sector in Various Countries
According to Raghav Bharadwaj in AI in Government – Current AI Projects in the Public
Sector (2019), government in current condition have piloted, implemented, or planned across
three groups of AI implementation, i.e. Citizen Engagement; Improving Oerational Efficiency;
and AI Strategies for Policy and Legislation.
Citizen Engagement
The New York City Department of Social Services (DSS) in USA offers public assistance
and employment services to over three million citizens. In one of their initiatives, called the
Supplemental Nutrition Assistance Program (SNAP), employees of the government agency
needed to process around 70,000 SNAP applications per month. With such a large number of
applications and limited manual resources, DSS decided to digitize and automate the process
by offering a self-service online portal called the ACCESS HRA (AHRA).
IBM and DSS collaborated in a private-public partnership to develop the portal. The IBM
Watson Health Government team was tasked with finding a scalable solution to maximize
outreach to the customer base. IBM was allowed to access data from PC banks at 15 of DSS’
physical service centers. This allowed IBM to access user feedback that illuminated trends in
what people wished to see from the program.
In 2015, the US Citizenship and Immigration Services (USCIS) in USA announced the
launch of a chatbot named Emma. Emma can reportedly answer questions on immigration and
take visitors to the right page of the USCIS website. The USCIS was receiving a high volume
of customer queries, with over 14 million calls on immigration issues each year.
Infocomm Development Authority of Singapore (IDA) is working alongside Microsoft to
build conversational intelligence into existing public services as a proof of concept project. The
goal for the project is to make online public service websites more accessible and engaging for
all citizens.
Improving Operational Efficiency

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 The City of Pittsburgh in USA collaborated with Rapid Flow Technologies to develop
SURTRAC (Scalable Urban Traffic Control), an automated traffic optimization and control
software. City traffic control departments can use SURTRAC to manage traffic flows through
several intersections and use AI to optimize the traffic systems toward reduced travel times,
reduced number of traffic stops, and reduced wait times.
Rapid Flow claims SURTRAC helped the city reduce travel time by 25%, traffic stops by
30%, wait time by 40%, and overall emissions by 21% during the course of the pilot. Rapid
Flow then collaborated with local Pittsburg administration to expand the solution to other parts
of the city, bringing the total of SURTRAC-installed traffic signals to around 50.
AI researchers from Georgia Institute of Technology, Emory University, and the University
of California, Irvine worked with the Atlanta Fire Rescue Department (AFRD) to develop a
predictive analytics software aimed at identifying buildings that have a higher likelihood of fire
incidents.
The researchers developed “Firebird”, which purportedly uses historical data for 58
variables made available to them by the AFRD. This includes data such as property location,
fire incidence, building size, building structure, and year built for the period 2010–2014. The
data was fed to an AI predictive analytics software and the algorithms were tweaked to forecast
fire risk scores for 5,000 buildings. According to the university, the software accurately
predicted 73% of fire incidents in the building.
AI Strategy for Policy and Legislation
German Federal Government stated they will consult several experts on the application
possibility space and regulations that might be needed for implementing AI in their country.
These experts were from industry associals and academia all over Germany and their insights
will serve as a basis for the development of the strategy. This panel of consultants will also
help with defining goals and fields of action for the Strategy which will eventually be adopted
by the German Federal Cabinet.
National Institute of Advanced Industrial Science and Technology (AIST) and METI
Ministry of Economy, Trade and Industry have announced a collaboration aimed at attracting
top AI researchers for the development and commercialization of Japanese AI technologies.
To this end, the Japan Meteorological Agency, Japan Patent Office, Electricity, Traffic and
Transport authorities are currently undertaking AI projects which can help augment the
capabilities of human operations in tasks such as patent and trademark examination, the
management and forecast of traffic, and the development of predictive capabilities for
emergency responses.
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8. Human vs AI : Decision Making Capability
Talking about AI versus human value judgment, the first point that government have to
accept is the differences decision made between human intelligence as a God’s blessing and
artificial intelligence (AI) as a human’s creation. Everybody knows that human has emotion,
and machine does not. Banerjee, Singh and Bajpai (2017) have done a comparative study on
decision making capability between human and AI. They do research by using chatbot as a tool
to compare human and AI responses about topic they asked. They conclude that between
human and AI, each of them have strengths and weaknesses. Summary about their research can
be seen in table below.
Table 1. Comparison of Human Intelligence and Artificial Intelligence
No Parameters Human Intelligence Artificial Intelligence
1 Strength of Human judgment of facts is AI-based judgment of facts is not
emotions influenced by emotions. Hence, influenced by emotions. Hence, it is weak
it is strong
2 Strength of Human intelligence is stronger AI is weaker than human intelligence but
intelligence via nature-based analysis of the procedural programming and reinforcement
problem, perception, learning can improve the quality of
psychology, and experience intelligence
3 Reasoning Common sense-based Probabilistic reasoning, meta-reasoning
reasoning, philosophical
reasoning
4 Memorization Humans can recall memorized AI can recall memorized content faster and
content easily but content more accurately
sometimes might be incomplete
5 Response Depends on the situation. Independent of the situation for any nature
time Critical of decision, it requires less time
decisions need more time
6 Cognitive Extremely high degree of Low cognitive skills but with improvements
skills cognitive skills in the field of artificial consciousness
cognitive skills can improve
Source: Banerjee, Singh and Bajpai (2017)
Based on summary above, for some kind of tasks in government, it is good if government
use AI because of its reasoning, less emotion, accurately memorize, independent and
adaptability to learn. But, for some tasks that need emotion, philosophical reasoning, and
political judgement, the author suggest that those are not the tasks AI really capable of.
9. Conclusion
Implementation of AI is something that is very commonly used today. In the private sector,
Everybody knows Google with its AI sophistication in helping our daily routines, in IBM there
is a famous AI application named Watson, as a health analysis machine, and in Apple there is

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Siri, the powerful iOS assistance. All of them cannot be separated from the sophistication of
today's technology that humans can create machines which are capable of thinking like humans.
Lately, the public sector has realized the importance of using AI in carrying out their tasks
and duties. AI is a tool that will be very useful in the future that can help the government
provide maximum service to the society. Related to strategic planning, technology is one of the
factors that can influence decision making. Therefore, developed countries such as the USA,
Germany, Singapore and Japan have already taken a step in order to adjust to this rapid
technological development.
The use of AI will be very useful because the government can map clearly the portion of
employees in each field. This is called resource allocation. Furthermore, by implementing AI,
workers will be able to maximize their time management so that the work done will be
maximized.
However, implementing AI found many challenges, risks and obstacles. The most important
problems are the AI ethics, transformation of work and citizen’s perspective. In terms of ethics,
is it ethical when the society pays employees through taxes, but part of the jobs is done by AI.
In addition to transformation of work, many concerns arise such as making employees become
lazy and dependent on AI too much.
In spite of all that, the government can use some strategies to succeed implementing AI in
their sector. They must indeed begin to adapt to technological developments because the
increasing workload is faced with limited resources.
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