In this episode of the In Case You Missed It podcast, host Dustin Haisler chats with panelists Jeb and Joe about the key takeaways from NASCIO’s 2021 Annual Conference in Seattle. The discussion opens with a review of an article highlighting how IT’s role in government has shifted during the pandemic, moving from a reactive support function to an early‑stage strategic partner that now enjoys a permanent seat at the decision‑making table. The hosts note that IT spending is outpacing expectations, with year‑over‑year growth potentially reaching double‑digit levels, driven in part by federal relief funds. They then dive into a recent NASCIO‑Grant Thornton‑CompTIA survey that explores the “new normal” for digital services, remote work, cybersecurity, and emerging technologies. Remote work is expected to remain a core practice, and agencies are grappling with cultural and managerial challenges. AI adoption is another major theme: from early chatbot pilots in 2019 to rapid expansion during the pandemic and now a broader rollout of machine‑learning and robotic‑process‑automation solutions across state agencies. Supply‑chain shortages, especially for hardware components, are causing project delays and prompting agencies to start strategic planning early. The conversation turns to the complex landscape of federal funding—CARES Act, ARPA, and the pending infrastructure bill—where state CIOs are eager to tap available dollars but face legislative and compliance hurdles. Finally, the panel celebrates the return to in‑person events, noting the energy of the conference and announcing that NASCIO will resume full‑steam, in‑person gatherings in 2022. The episode wraps up with a preview of upcoming deeper dives into the survey data and AI report.
Chapters
All right, welcome back to another episode of In Case You Missed It. Happy Friday, we hope everyone's had a great week. It's been another wild week of all kinds of market activity, and there's some great things that have kind of come out this week as well that we're going to talk a little bit about. Joe is also fresh back from NACIO's annual conference in Seattle, so we're going to spend some time digging into what he heard and saw in the trenches of that major event. But to start first, Jeb, what, what was kind of on your radar for this week?
Well, Dustin, I was actually on vacation earlier this week, and then I got back and looked at all the articles at GovTech.com, and the one that really stood out to me is this article about the changing nature of IT in government. So at NACIO, our editor, Noel Nell, and also managing editor Lauren Harrison talked to CIO of Indiana, Tracey Barnes. And so he covered the basics. You know, whenever the pandemic happened, IT had to have a more active role in helping out with solutions, whether it had to be something to do with telework, Maybe an employment system surge, something like that. But beyond that though, IT in government is still advancing. And the way that he talks about it, he says that now IT is included earlier in the conversation when it comes to different solutions that are needed, and also continuously along the way IT is staying in that conversation. So what he says is that he hopes that this shift is permanent because it gives It gives IT a better enterprise view of what's going on in the state, and it's ultimately better. It results in better services for the people that need the solutions. So it'll be very interesting to see how this continues to play a role, and not just how government employees, you know, meeting their needs, but also citizens too. So we'll see what happens over the next year. As the pandemic hopefully starts to die down a little bit.
Yeah, I think it's a great point because we definitely have seen IT play such a critical role in response. You know, even though there were fiscal cutbacks and things that happened, furloughed employees even at the local levels, IT spending was on the rise. You know, Joe and I were talking, I think, at a Beltway right before all this happened, anticipating smaller increments, you know, maybe a 2 to 3% year-over-year growth, and information technology spending. Joe, what do you think? We're sitting at maybe up to 10% increase, you know, year over year?
Yeah, I mean, it's bolstered by the federal funding, but exactly what you saw in line with what Jeb just mentioned, the CIOs are taking a seat at the table beyond tech, and I think that's going to be something that's likely going to be sustained post-pandemic.
And so the article that kind of stood out to me, which kind of ties into some of what Joe is going to talk about, was a new survey that came out from NACIO, from Grant Thornton, and CompTA that really dove into some of these key themes around what digital services and work practices are going to continue to remain. I mean, this is a question that is still lingering, like what is this new normal? As Jed said, we hope things will calm down, but what's going to stick around post-pandemic? Remote work, how's it going to look? How are you going to manage employees with these cultural disconnects? And so this really validated a lot of the conversations that we've seen as well as you get into remote work really being kind of a key thing that agency leaders think will continue on, you know, post-pandemic. A lot of other really interesting insights in this survey as well. GovTech had a great data piece that kind of focused on this, that went into everything from cybersecurity to some of the key themes that state CIOs envision as they look at the return to normal. But I think that's a good segue to kind of, you know, shift gears and talk a little bit about what you saw, what you heard, and how Nassau was. So Joe, kind of first question for you there is, how was it being back in person?
Well, yeah, it was the first trip since March of 2020, but I can tell you walking into the event on Sunday and heading into the reception, it felt really good to be in an in-person event again. The, the vibe at the event was very much like that of a reunion. Imagine going in, seeing familiar faces, friends again for that haven't connected in person for, you know, a year and a half. There was a lot of energy at the event and in the room, and I think you felt pretty safe too with the various protocols that were in place at the event.
Joe, what were some of the major themes that really stood out to you while you were at the conference?
Yeah, I mean, a handful. Some of it you just hit on, the survey findings there, right? NASIO usually releases a handful of surveys. We worked on one related to artificial intelligence, but I think that Generally, you saw that the rate of technology adoption has rapidly accelerated and has no signs of slowing down. I think whether you're talking to industry or government, everyone's trying to wrap their arms around the federal funding opportunity, whether that's trying to gobble up the last of the CARES Act funds, to figuring out what's coming with the American Rescue Plan Act and what's left there for government, to what may be coming around the corner with the infrastructure bill. So trying to make sense of the opportunity that's there and the possibilities for technology. Then you look at some of the more technology-specific findings that you saw in those reports. I think what you see is a growing interest in emerging technology, whether that's RPA and automation. Dustin, you know, you and I have been talking about that for the better part of the last 18 months. And then one challenge that emerged, specifically talking to the industry, was around the supply chain issues that we're seeing impact our own personal lives day to day, but also now having an impact on GovTech projects, delays in getting, you know, black boxes as one example into production. Those delays may further push back some of these strategic initiatives. So one word of caution is don't wait. Don't wait for the, you know, to start that strategic planning process to greenlight those projects because you may run into some significant delays if you run into those supply chain issues.
Yeah, definitely a thing that we'll kind of dig into in a little bit as well. Now, you gave an update while you were there on AI and government, and this has been a multi-year engagement that you've done with IBM and NACIO to really kind of talk about almost the state of AI in state government agencies. Any highlights you want to share from that report?
Yeah, it's pretty fascinating, right? We started in 2019, as you can imagine, pre-pandemic. States were just kind of dipping their toes in the AI pool, if you will, experimenting with chatbots, But it was really just starting, a lot of fear and anxiety. Fast forward to 2020, obviously in the middle of a pandemic, we saw this explosion around chatbots, right? States couldn't deal with the surge of constituent communications that were coming at them in unemployment insurance or just general citizen requests. Now fast forward to where we find ourselves in 2021, we've seen AI use skyrocket. I don't have the figures in front of me, but we'll have them out here in the next week and a half. when we have the full report released, but you will see double-digit growth in terms of AI use across all levels, whether that's pilots, whether that's used across the state, pretty significant. I know GovTech covered it as well. And then what you also start to see is the deepening of AI adoption. 2019, we didn't have very many states talking about machine learning. We had very few states talking about RPA. Obviously, RPA has taken off, but now looking forward, We're gonna see greater use of machine learning and the deepening across state agencies and departments and their use of AI. So very exciting.
Joe, I know that earlier you already mentioned the whole supply chain issue and you gave an example. I was wondering whether you could go into more detail about that, you know, maybe about some of the things that you heard from some of the specific individuals or agencies about this issue.
Not so much from the agency perspective. Certainly an understanding that there have already been delays, right? Imagine, you know, ordering 13 servers, only getting 6, right? That can put a significant crunch on some of your plans. A little bit more on the industry side, being very transparent about the challenges that they're facing and encountering as it relates to the supply chain issue. We've seen it internationally in terms of the computer chip shortage. as well. So I think it's out there, but no one's, you know, talking about it a lot. There are some vendors out there that are leading the way on that conversation, but as you start to see states that are trying to make, you know, an assessment of where they are, plan strategically going forward to take advantage of these federal funds, you've got some tight deadlines coming up to use some of these federal funds, and you don't want to get caught by supply chain issues. So there's going to be a lot of juggling going on to balance the momentum of the federal funds with some of the realities related to the supply chain.
Yeah, let's dig into the federal funding dynamic a little bit because I know, you know, we've got the CARES Act funding that had direct, you know, impact to state response to the pandemic. Then we had ARPA come out where we started to see, you know, the fiscal relief funds that had a more direct impact. Now we've got the infrastructure bill, which we'll see what happens with that. And, you know, if that happens, tell us a little bit about how you were seeing the state CIOs approaching this federal funding.
Yeah, I think it's an interesting time, right? Everyone's juggling 3 funding streams, probably not as focused on the infrastructure bill yet, just because of the political uncertainty at the federal government level. Everyone knows what's there and the prospects of what $65 billion of broadband could mean, or the funding for cybersecurity, but really laser-focused on ARPA. Look, frankly, I think we might have talked about it a couple weeks ago. There was a study done by the Associated Press that said, like, hey, we looked at it, we looked at the states, we looked at the cities, the counties, less than 10% of it's been spent. So there's a lot of, I could say, pent-up demand to take advantage of those funds, but a slower legislative process both at the state level and local government to fully leverage these funds. And I'd say on the industry side, just as many questions. How do we capture our fair share? How do we advise state X, Y, or Z that what we're trying to work with them on is an allowable expense? So even though those funds came out in March, I'd say there's still a lot of questions and a lot of opportunity on how to fully take advantage of those funds for state and local government related to technology.
So, Joe, as you mentioned, as we talked about earlier, NASIO was back live this year, which was a huge deal. But I understand that you might have some news about something else that could be coming back live in 2022. I was wondering whether you could share any details about that.
Look, being back in person felt amazing. It really, there was the spirit, the energy that I talked about at the beginning of this just felt great. The news is we're coming back full steam ahead, in-person events in 2022. So while we love the virtual Digital Government Summits and you still may see those mixed in, we're coming back at you in person at all the events that you know and love. So we're really excited. We're gonna be excited to see you all there along with us. So that brings us to the end of this week's episode. Look, a lot to unpack here. NASCI was fun. We're looking forward to digging into those surveys and reports a little bit more, but exciting news as far as our events are concerned too. So we look forward to seeing you in person, and we look forward to seeing you on next week's episode. So see you there.
