Digitalization in public administration: challenges, solution strategies, and best practices

In this article, you will read

• why public administration stands at a crossroads,
• how digitalization can help simplify administrative processes and ease employees’ workloads,
• and why integrating a sovereign cloud into digitalization initiatives is so important.

Public administration is undergoing a historic transformation: Analog structures, staff shortages, and rising citizen expectations are colliding with new legal requirements and digital opportunities. Strategies, technologies, and best practices from Germany and across Europe show how authorities can navigate this balancing act.

Faster administrative processes are not only in the interest of citizens and businesses—they also strengthen Germany’s competitiveness. Public administration is therefore pursuing various digitalization initiatives to meet these goals.

Paper-based files and manual procedures still dominate daily operations in many public agencies. The result is slow processes, long processing times, and high administrative costs. Comprehensive digitalization is the only way to make administrative procedures more efficient and citizen-oriented.

More than 80 percent of citizens want digital administrative services, from ID card applications to vehicle registration and family benefit claims. Businesses also demand fast, digital interfaces to streamline coordination with public authorities. Improving digital services not only strengthens public trust in state institutions but also enhances the global competitiveness of industry.

In Germany, the federal system adds complexity to digitalization. Responsibilities are divided, and interfaces are often poorly defined, leading to redundant work, isolated systems, and inefficient processes. A uniform approach to digitalization requires collaboration across all government levels, from the federal government to the states and municipalities. This includes establishing shared standards for data, data structures, and the consistent mapping of administrative processes.

Alongside various digitalization initiatives, public administration units are bound by a wide range of regulatory requirements and directives. Implementing these requirements has not always been successful.

Political decision-makers have recognized digitalization as a key factor for competitiveness. National and European digital agendas are designed to pave the way for future economic and administrative strength.

By the end of 2025, all central administrative services must be digitally available. The OZG requires authorities to offer services that are user-friendly and free of media discontinuities. Municipalities can benefit by providing citizens with consistent digital access and by simplifying administrative procedures.

The federal government’s digital agenda focuses on modernizing public administration. This includes expanding e-government platforms, promoting digital identities, and introducing the electronic file system (e-file). At the same time, European Union initiatives such as the Digital Decade 2030 and the Single Digital Gateway Regulation are accelerating progress and encouraging greater interoperability.

• More efficient processes and cost savings
  Digital workflows accelerate procedures and reduce paperwork. This lowers costs and frees up capacity for more strategic tasks. However, it is important to note that simply transferring a complex paper-based process into a digital format does not make it efficient. Successful digitalization of public administration requires rethinking and redesigning processes.
• Better services for citizens
  Digital portals provide citizens with access to administrative services around the clock. Long waiting times at service counters or in offices are increasingly becoming a thing of the past. Information can be made easily accessible, including clear descriptions of administrative procedures in plain language and in barrier-free formats.
• Relief for employees
  Routine tasks can be automated, allowing qualified staff to focus on more complex work. This also helps address the shortage of skilled workers, with estimates predicting a gap of up to 840,000 employees by 2030. Most importantly, digitalization reduces the heavy workloads that often burden public sector employees.
• Sustainability
  Digital administration reduces paper use, transportation, and resource consumption. However, the energy efficiency of IT services must also be considered. Efficient IT provisioning models such as cloud computing can contribute here, especially when supported by modern, energy-efficient data centers with low power usage effectiveness. When these centers are powered by renewable energy, public administration can make significant contributions to a sustainable future.
• Transparency and traceability
  Digital systems automatically document processes, making administrative procedures more traceable. This increased transparency and traceability enable better planning for citizens and businesses and help strengthen public trust in administrative institutions.

A combination of established and emerging technologies provides the foundation for advancing the digitalization of public administration. Key enablers include cloud computing, artificial intelligence, and automation. In addition, standardized data structures and formats are essential to ensure interoperability and efficiency.

Cloud solutions form the technological backbone of digitalization initiatives. Traditional IT infrastructures cannot keep pace with the rapid development required for modern digital processes. Cloud environments provide flexible IT resources that can be tailored to the needs of public authorities. Sovereignty is particularly important: Cloud solutions must ensure data and legal security within Europe while offering users maximum transparency and control.

E-government platforms serve as unifying frameworks that connect a wide range of administrative services. They provide a central gateway to digital administration, allowing citizens to log in once with their digital identity and access multiple services, such as vehicle registration or change-of-address applications. In the background, data is automatically exchanged across administrative domains, improving efficiency and consistency.

The e-file replaces paper archives and enables direct access to all relevant documents. This saves time, reduces errors, and facilitates collaboration between departments. At the same time, the data contained in documents becomes digitally available, simplifying both processing and analysis.

Artificial intelligence (AI) systems can automatically pre-sort inquiries, respond to citizen requests, or check documents for completeness. They relieve employees of repetitive manual tasks and simple decision-making processes, which accelerates workflows and allows staff to focus on more complex cases.

Many administrative procedures do not require human decision-making. Robotic process automation (RPA) can handle repetitive tasks such as data comparison or document transfer. When combined with blockchain technology, automation can enhance tamper-resistance, traceability, and transparency in administrative processes.

Germany’s federal structure is often seen as the main obstacle to successful digitalization, as it complicates the creation of standards and unified approaches. The distribution of responsibilities across multiple levels of government has resulted in numerous isolated solutions that are difficult to integrate into a cohesive system.

Cloud services reduce upfront hardware investments and lower maintenance requirements. Authorities only pay for the resources they actually use. However, the real value of cloud solutions lies not only in cost savings but in their role as enablers of innovation. Their rapid availability frees public authorities and IT service providers from long delivery times. Developers gain immediate access to development platforms, services can be scaled easily, and even complete software-as-a-service (SaaS) solutions can be provided on demand.

Authorities can automatically scale their systems up or down based on demand, which is especially beneficial for fluctuating workloads. Flexible cloud resources are also ideal for temporary projects such as data analysis or AI model training. Graphics processing units (GPUs) can be accessed from the cloud as needed and in a scalable way, without requiring permanent investment.

With European cloud providers, compliance with GDPR, BSI C5, and IT baseline protection (IT-Grundschutz) standards can be ensured. This guarantees that data remains under the control of public institutions. The Open Telekom Cloud, for example, offers a wide range of certifications that confirm compliance with regulatory standards. These include the secure processing of social data and data handled by professionals bound by confidentiality obligations.

Cloud ecosystems provide more than just infrastructure and platform services such as databases. They also offer access to additional services from the broader cloud environment, often available as SaaS. This enables rapid deployment of new technologies such as AI or data analytics “as a service.” The Open Telekom Cloud, for instance, provides a range of large language models that can be used for AI development and operations, helping public authorities stay technologically current.

Because cloud services are delivered “as a service,” operational teams are relieved of time-consuming infrastructure management tasks. Using DevOps and cloud-native approaches, many processes can be automated and accelerated, allowing staff to focus on higher-value work.

Cloud solutions can easily be deployed as web-based services, enabling the creation of modern citizen portals that are accessible 24/7. These services improve the availability of administrative functions for both citizens and businesses. Greater accessibility and convenience lead to higher satisfaction with public service delivery.

Cloud services create transparent cost structures that also make energy consumption more visible and manageable. Efficient provisioning, inherent to cloud architecture, optimizes resource use. Cloud providers can further enhance sustainability by offering users data on the energy performance of their data centers. Certifications in this area ensure accountability and support climate goals. In this way, cloud solutions make a meaningful contribution to environmental sustainability.

Lighthouse projects at the federal and state levels demonstrate the value that digitalization can deliver. The Open Telekom Cloud is involved in several of these initiatives. Additional momentum is also coming from other European countries that are leading the way in public sector digitalization.

• BayernPortal: Provides citizens and businesses in Bavaria with access to a wide range of administrative services.
• Servicekonto.NRW: Serves as a central access point for online services in North Rhine-Westphalia.
• BundID: A digital citizen account that enables access to nationwide administrative services.
• E-Akte: A digital file management system being gradually implemented across federal and state administrations.
• IHK Munich: Achieved greater development agility through migration to the cloud.
• Judicial Modernization: Introduces unified specialist procedures based on a sovereign cloud infrastructure.
• Corona Emergency Aid: Enabled the rapid setup of automated funding and approval processes.

• Estonia: A global pioneer with its X-Road system, through which nearly all administrative services are available digitally.
• Austria: Uses FinanzOnline and electronic signatures to simplify daily interactions for citizens and businesses.
• Denmark: Operates a mandatory digital mailbox for citizens and provides a wide range of online administrative services.