How to innovate on the operating model of public services

by Eddie Copeland, Nesta's Director of Government Innovation. This article originally appeared on Nesta.com on February 9, 2018.


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A common critique of digital government is that many initiatives amount to little more than adding a slightly better digital front face to the same old processes behind the scenes. This is transformation at its most superficial: creating a more user friendly experience, yes, but doing little to fundamentally improve a service.

This observation speaks to a wider point:

While we have witnessed exponential levels of innovation in the technology available to governments and public sector bodies, there has been little innovation in the processes and structures to which those technologies are applied.

Given the current state of public finances and the urgent need for reform, that imbalance surely needs to be addressed.

That’s why at Nesta, we advocate that before public sector organisations consider what new technology they want to deploy, they should first ask themselves the question: what is the best way to address this particular need?

After all, they need not be confined to maintaining the traditional, top-down form of public service provision, in which services are delivered by public sector staff, with citizens merely as passive recipients.

So what are the alternatives?

Below I sketch out eight variations of operating models for public services and the different ways in which they deploy people and resources. (There is a separate but related question about ‘business models’ - i.e. different ways of funding public services - that will be considered in a future blog.)

1 - Traditional top down public service

Let’s start with the most traditional model. Citizens pay taxes, and the government or public sector body delivers the service directly. This model is common for everything from medical treatments offered by hospital doctors, to bulky waste collections provided by local council staff. With this model, public sector organisations wishing to innovate have the usual options available to them. They can enhance the service with better technology. They can use data to target their resources more effectively, or predict and intervene earlier. They can achieve economies of scale by forming shared services with neighbours, and so on, but the fundamental shape remains the same.

2 - Outsourcing

An increasing number of functions are outsourced by public sector bodies. Some just outsource backend functions like IT; others have moved the majority of frontline services to external providers. Achieving improvements and efficiency with this model has largely been about careful vendor selection, and good contract design and management. Yet the significant budget reductions faced by public sector organisations has led many to have little choice but to focus on the vendor able to provide the lowest price.

A more innovative approach is offered by Citymart. Citymart uses ‘problem-based procurement’, helping public sector organisations access more novel solutions from a much broader range of providers by specifying the problem they are trying to solve instead of the product they want to buy. This focus on ends rather than means can be a highly effective way to transform the way particular needs are met and achieve cashable savings at the same time.

3 - Radical restructuring

In-house or outsourced services can innovate by dramatically shifting the structure of power and responsibility between their workers. Inspiration for one such restructuring comes from the Dutch community nursing organisation Buurtzorg. In place of having hundreds of community nurses timetabled to the nearest five minutes by large numbers of back office staff (as is the case with many UK social workers), the Buurtzorg model sees nurses arranged in self-managing teams of no more than 12. Those teams handle their own recruitment, time management, schedules and workload for their patch, which covers up to 60 people. The result has been the creation of 900 teams in the Netherlands, supported by just 50 administrators and 20 trainers. The model has led to a radical improvement in service outcomes, up to 40% cost reductions and higher staff morale.

4 - Augmenting the capacity of a service with volunteers

Public sector bodies can use technology to augment the capacity of a public service by tapping into a volunteer network.

The best example is GoodSAM. When somebody calls the emergency services to report that an individual has had a cardiac arrest, as well as dispatching an ambulance, many ambulance trusts are now able to send out an alert to GoodSAM. The GoodSAM app alerts qualified first aiders in the vicinity of the victim, highlighting their location and that of the nearest defibrillator so they can hurry to the scene. When every second counts, those volunteers can make the difference between life and death. Indeed, they have already been proven to do so. 

Government and public sector organisations could look at other areas where volunteers might be alerted to action via a digital platform. For example, volunteers could be called on to help during peak demand for hospital transfers. Nesta’s Vicki Sellick has cited the example of The Mix, a charity providing support to the under 25s, which has already piloted tapping into a volunteer network to handle calls and web chats from home.

5 - Government as matchmaker

Today, some of the world’s most celebrated companies take advantage of ‘platform business models’ - online communities that are hyper efficient at revealing and then matching supply and demand. (Think of Amazon, eBay, Airbnb, Match.com, etc.) The use of such platform models presents two new options for public services.

The first is to replace a top-down public service with government playing the role of matchmaker. Using an online platform, government can aim to connect two sides of a market in a particular sphere, matching those with a certain need with others who can address it. Nesta’s ShareLab Fund has supported ideas along these lines, including TrustonTap, which helps connect those in need of care with local carers. With this kind of operating model, the role of the public sector can be to run the platform, or to commission others to establish it in their area.

6 - Creating peer-to-peer networks

The second version of the platform model is for public sector organisations to use digital platforms to enable citizens with specific needs to provide peer support to each other (as opposed to connecting them with professional providers). This idea is neatly demonstrated by Casserole Club, a peer-to-peer alternative to meals on wheels, created by FutureGov. A second, non-digital example, is South Australia’s Family-by-family, a peer-to-peer support network for vulnerable families, which addresses a similar set of needs to some adult social care services.

7 - Digital Social Innovation

Nesta has long advocated a strong third sector as being part of the solution to many of the challenges that governments and public sector organisation traditionally care about. One incarnation of this is our work on Digital Social Innovation (DSI), through which we have identified, mapped and connected the rising number of civil society organisations that use technology to tackle social challenges in innovative ways. Our platform https://digitalsocial.eu/ shows more than 1,900 such organisations across Europe, who are addressing issues as diverse as neighbourhood regeneration to improving health and wellbeing.

These initiatives may originate outside of government, but they deserve more than just benign neglect from governments. Rather, they should be actively encouraged precisely because they can help tackle the social issues that governments and the public sector care about. Supporting them could build into a genuine partnership between the state and civil society in coming up with more innovative ways of tackling big social challenges, massively increasing the level of resources involved in their resolution. When the resources of the state are diminishing, and demand rising, we believe this will be a major part of any plausible long term solution.

8 - Open data innovation

Organisations like Transport for London have enhanced their service by releasing open data of sufficient quality and reliability that it has enabled others to build useful products and services. More than 450 transport apps have been created by external developers using TfL’s Unified API, helping TfL’s customers, and saving TfL an estimated £4 million a year. A key lesson is that if public sector bodies wish to encourage this sort of innovation in their services, it is not sufficient merely to publish their data and hope for the best. Real results come to those organisations willing to provide support, context and SLAs around their data. 

Summary

I do not pretend that every service can adopt a new operating model. In some cases, we may just need a more honest public conversation about the fact that there aren’t yet good alternatives to paying for the traditional model of public service delivery.

However, as this article has shown, there are at least eight different models (no doubt there are many more), each of which has its own potential for innovation. By considering all these as possibilities, public sector organisations may realise they have alternatives to merely economising on what they already do.

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