The potential of digital transformation in the municipalities of Ukraine

The potential of digital transformation in the municipalities of Ukraine

Photo: depositphotos
10 January 2022

Digital transformation is among the priorities of the Ukrainian government. Transferring public services online and digitizing processes are envisioned in the EU-Ukraine Association Agreement, the State Strategy of Regional Development, the Economic Strategy, and ministerial plans. Systemic efforts promise to greatly facilitate communication between citizens, the state, and businesses. Read this article to learn more about the steps being taken by the central government, the municipalities’ potential, and where they should start on their path to transformation.

The article is based on the results of the “Digital Transformation at the Local Level” session held on December 8, 2021, during the International Expert Exchange 2021:Partnership for Development, as part of Vox Ukraine’s analytical partnership with the ULEAD with Europe program. 

Digitization at the regional level 

The Ministry of Digital Transformation of Ukraine plays a key role in digitizing the regions. Deputy Minister of Digital Transformation Valeriia Ionan speaks about the direction of the government’s transformation efforts. She starts by placing emphasis on introducing in Ukraine a new position of chief digital transformation officer (CDTO), i.e. a deputy responsible for digital transformation. In 2020, such posts appeared in all ministries, followed by deputy heads of regional state administrations in charge of digital transformation appointed at the end of the same year.

“We seek that each ATC and city should be able to oversee the digital transformation process themselves, with their leaders being the visionaries and drivers of this process. Of course, to do this requires strong managers,” Valeriia Ionan said, explaining the need for the new position.  

The Ministry’s goal is to implement the “25-38-1400” concept of having 25 deputy heads of regional state administrations (14 already appointed and four are in the process of being appointed), 38 CDTOs in large cities, and 1,400 digital leaders in municipalities.  

“The main functions of the officials in this position have to do with developing basic digital infrastructure: internet, administrative service centers, paperless office (signing and storing electronic documents), digital services, implementing digital projects in health care, education, infrastructure, and economy. It’s about streamlining governance with the help of electronic document flow, analytical data, big data, dashboards, digital registers, etc.,” Valeriia Ionan said.

The Deputy Minister also noted that it is important that municipalities learn how to collect reliable data about themselves as it is impossible to make sure that correct decisions are made without doing so. 

“Our understanding is that the basic digital infrastructure is a “zero” point, a foundation we have to lay in the next couple of years to show faster progress of digital transformation in other areas. Because without good internet access, without physical infrastructure, without digital services, and a proper level of digital literacy, we won’t be able to talk about making any substantial progress in development,” the official said.

Digitization at the local level

According to Oleksandr Dudchenko, Deputy Minister for Development of Communities and Territories of Ukraine in charge of digital development, transformations, and digitization, much attention is paid to digital transformation in the seven-year Regional Development Strategy. Regional strategies are currently being developed, and regional digitization programs are being adopted. 

“In collaboration with the ULEAD with Europe Program, we’re currently working on a tool to enable us to make all these strategies interactive, having them on one platform. We want to create a tool that will focus on the metrics embedded in all strategies and project programs, to understand how a particular project has affected reaching certain goals set out in the strategies,” Oleksandr Dudchenko said. 

According to the Deputy Minister, when the CDTO position appeared in the Ministry for Development of Communities and Territories Development, a digital transformation strategy was developed to achieve three major goals: building the Ministry’s capacity; implementing national or state digital transformation projects in areas under the Ministry’s purview; and implementing regional digital transformation since the Ministry is generally responsible for the country’s regional development. 

The Regional Development Office reinforces all these processes. The Office’s principal task is to create and distribute a database of successful practices of digital development in the regions. “We need to study how changes came about in a particular municipality; understand the whole ecosystem of those changes, starting with how problems were articulated; the organizational approach used, processes, regulations, the local councils’ decisions; and, of course, IT tools and their sustainable use,” the Deputy Minister said.   

“We now advise all municipalities to focus on changes that increase economic efficiency since they’ll provide resources that can be further used for municipalities’ needs,” Oleksandr Dudchenko said. “After successful decentralization, we’ve got many municipality clusters. We’ve got capable and rich ATCs, and we’ve got small but enterprising ATCs. There are municipalities focusing on industry and municipalities focusing on agriculture. Within these clusters, we’ll work on the changes that will be of most use to the municipalities.” 

The Deputy Minister stresses that a municipality should align its capacity with the solutions pondered in the municipality. Another important thing is developing integrated solutions: the more similar the solutions are, the easier it is for municipalities to build related solutions, enhancing decision-making based on data. Providing municipalities with access to data is one of the Ministry’s tasks because ATCs currently lack access to lots of data essential for decision-making: taxes, land, state registers, etc.      

Oleksandr Duchenko calls synchronizing efforts at all levels – at the municipality, local, and central government levels – the key to sustainable digitalization. “It’s important that CDTOs in regions and cities know what the central executive bodies are doing to avoid duplicating these processes and be ready to use the new services soon.”

How to make municipalities digital

What needs to be done to make Ukrainian municipalities digital? The answer to this question is found in a study by the Ministry of Digital Transformation conducted with the support of Malik Institute (Switzerland). In particular, the study revealed three problems standing in the way of digitization in Ukraine. For starters, it is the human factor, or more precisely, the lack of specialists in the field able and willing to work in digital transformation. The government undertook to solve the problem by training specialists. To find digital leaders for municipalities, the Ministry is working with NGO Lift:Digital focusing entirely on seeking digital transformers in the regions. Lift:Digital opens up opportunities for project managers, communications managers, development managers, analysts, graphic designers, network administrators, and other professionals. The project will help people looking for work in the field of digital transformation, offering them jobs.   

Secondly, it is bureaucratized communication between the central government and local self-government. A solution is to streamline processes or abandon optional ones. With the support of the ULEAD with Europe Program, the Ministry of Digital Transformation is currently studying digitization needs at 125 ATCs. This will help it understand the situation on the ground better.

And the third important thing to do is communicate success stories. According to Valeriia Ionan, there are many success stories, but they are not talked about enough for the municipalities to follow suit and move forward. One of the positive examples is the experience of the Digital Cherkasy project.

“The most interesting thing is that this project office is now actually combining the efforts of donors and businesses, uniting the region and the city within the topic of digital transformation,” Valeriia Ionan said.  

Over the four months of operation, the Digital Cherkasy project office got involved with developing a strategy for the region’s digital transformation, the region’s and the city’s digital literacy concept, and several pilot projects such as free high-speed Wi-Fi in hospitals, introducing telemedicine, and the most popular virtual tours with Google. On a separate note, there were also projects on digital transformation of environmental direction, e.g. air quality monitoring. Thanks to digital technologies, a safe school project for children with special needs is being implemented in Cherkasy. The concept of the Smart Street project is in the final stages of approval. 

“It’s amazing what a strong team of several managers can do in just four months. And if we had the right speed in every region, in every city, in every municipality, I guess we could move faster, and faster, and faster. That’s what we’d like to work on with our CDTOs, including next year. So, I urge everyone to look at different solution formats that can make CDTOs’ work more effective,” the Deputy Minister said.

Lastly, the role of the ecosystem of Diia projects in ATC digitization cannot be ignored. These include the Diia app used by over nine million Ukrainians, the Diia public services portal, the Diia.Digital Education national platform, the Diia.City project as the first virtual business country, and the Diia.Business project aimed at developing entrepreneurship. As part of the Diia.Business project, there are already 11 support centers for entrepreneurs operating in various cities of Ukraine. Valeria Ionan also spoke about the Ministry’s work on updating Diia.Digital Community. New modules of digital products and solutions for municipalities will be available on this portal.  

Digitization lessons from the EU experience

ULEAD with Europe program expert Donat Magyari shares six tips for a successful digital transformation on the ground.

  • Make sure you have a digital strategy.

The expert emphasizes the importance of understanding users’ needs and focusing on the demand side. “When planning a digital strategy and services, write down a user’s path and think of their experience. Perform a readiness or maturity test. After determining the level of maturity, the municipality gets recommendations on how to act, what training to undergo, and what support options to use. Create a “digitization roadmap”: from entry-level to digital maturity. Promote access to quality training and counseling services. Seek resources and financial support,” Donat Magyari said.        

According to the expert, politicians should use their experience to promote coordination with the ecosystem of innovative centers, networks, and platforms to ensure digital transformation.

  • Provide access to technology infrastructure.

The municipality must know how to use digital technologies relating to standards, security, technical, and technological capacities. Sometimes simple solutions work best. As an example of success, Donat Magyari points to Austria’s open expenditures data portal. Created in 2013, the portal contains data about all municipalities’ spending in the country since 2010, with mayors of all cities having free access to it (by using login) and a possibility to download data.

  • Develop digital culture, skills, and potential.

Municipalities need to develop their employees’ and citizens’ digital skills. This will make it possible to use digital platforms and develop an innovative culture in society. Lifelong learning, digital education, stakeholder engagement in projects, and digital initiatives are areas to develop and maintain.  

  • Be a smart operator and data manager.

The municipality’s data collection, management, and use in various procedures are key aspects of digitization. One option to manage data is “data cooperatives.” It is a new form of collaboration where participants share their data and information capacity to create collective influence.   

“Data cooperatives are not something very complicated, and they don’t have to be legalized. In fact, it’s a form of collaboration to exchange data. This may have some business implications, but at the same time, the public sector and society will benefit greatly,” Donat Magyari explained.

The expert cites a successful example of data management in Ukraine: an open data app for finding the best place to live – CityScale – developed by a Ukrainian startup.

“CityScale developers realized that there was not enough open data at the local level, so they started collecting data from the platform’s users. They can check air pollution, loudness, and noise levels across Ukraine. Data can be viewed and sorted out based on certain parameters. And it’s a very informative site, e.g. for foreigners willing to create their business in Ukraine,” Donat Magyari said.  

  • Collaborate and form a community.

The municipality’s planning and implementing plans may not be limited to administering since an open and shared approach forms the foundation for innovation, prosperity, and growth. Digital transformation opens up new avenues for collaboration: participatory budgeting, e-participation, e-voting, and many other possible forms of cooperation.

Donat Magyari stresses that there must be digital ambassadors in the municipalities, i.e. people promoting digital transformation. “It could be some local bloggers, journalists, an NGO, or maybe even a local entrepreneur.”  

An example of the successful consolidation of community efforts for digital transformation is the digital center in the Bulgarian capital Sofia, now a public library. “You can also develop digital centers based on your existing infrastructure and teach people how to use certain online solutions and mobile apps,” the expert said. According to him, older people in Bulgaria interested in mastering technology became trainers for others.  

  • Provide services with the user in mind.

Municipalities are working for the benefit of citizens, and digital services can facilitate access. Municipalities need to understand what services they should digitize and structure them for this purpose. The services will only be used if users know how to use them and if the digital tools of the municipalities and central authorities are popularized among the population.


Digital transformation is not so much of an abstract requirement today. It is a concrete opportunity to eliminate the distance between people and the state. Digitization’s success and implementation time depend on many factors. However, the most important ones are studying the municipalities’ technical capacity and demand, strategic planning, digital education, the availability of professional digital leaders on the ground, and motivation for education and development by communicating well the success stories. 

Vox Ukraine thanks VoxCheck intern Nazar Zabavskyi for his help in preparing this article.



The author doesn`t work for, consult to, own shares in or receive funding from any company or organization that would benefit from this article, and have no relevant affiliations