Crisis Breeds Innovation

Local, state and federal governments all deliver ever-increasing high-quality government services through third-party providers. To be certain, forming and managing these sophisticated, complex alliances is not easy.
by | October 11, 2006

If crisis breeds innovation, then we are surely on our way to a large set of new initiatives.

Officials at all levels of government experience the incessant demand for services that exceed the revenues available to support them. And today's "pressures" will become full blown crises over the next 25 years as an aging population produces demands that far outstrip resources. Health care and pension costs, combined with national security requirements, will overwhelm government's funding ability -- if government continues to perform as it does today.

I remember a comment that now-Governor Ed Rendell made when asked how he had the courage to accomplish so much in Philadelphia in his first term as mayor. He responded that Philly was on fire and the conditions of the time drove citizen demand for innovation; as he said, "The fire department had to be called." Similarly, the prospectively difficult circumstances outlined above will provide the context for bold government innovation.

This year marks the twentieth anniversary of Harvard's Innovations in American Government Awards. Since 1986, the Kennedy School of Government has awarded more than $20 million to innovative government programs, recognizing and promoting excellence and creativity in the public sector. (Click here for more information on the IAG Awards.)

Already we are seeing a shift in the types of programs that win the seven $100,000 prizes we bestow each year on programs that meet a significant need and are truly creative, measurably effective and transferable to other jurisdictions. Current winners represent a shift from an older model in which enlightened officials tried to wring more production out of government bureaucracies to a newer model that looks at how government can manage partners to produce public goods. Twenty years ago, officials primarily promoted internal increases in productivity accomplished through government bureaucracies, a model similar to the way U.S. automakers produced cars. Today we see government officials creatively managing relationships, similar to the just-in-time supply chain process more commonly seen in manufacturing now.

In fact, in the United States, local, state and federal governments all deliver ever-increasing high-quality government services through third-party providers -- nonprofits, private-sector, and faith-based and other community organizations. In our most recent book, Governing by Network, Bill Eggers and I write about this shift from traditional, command-control, hierarchical government bureaucracy to government by and through partnerships. Fundamentally, government simply cannot successfully discharge all of its current and future responsibilities by itself. For government to move forward, private and not-for-profit providers need to contribute public value by providing solutions.

To be certain, forming and managing sophisticated, complex alliances is not easy, and government executives must take into account three key considerations when transforming to a networked government environment:

First, control results, not processes. Officials worry about the wrong things when they focus on control. Public officials remain wary of surrendering control of service delivery to nongovernmental agents; officals are painfully aware of the ultimate responsibility they have for meeting public expectations. However, this understandable anxiety should motivate officials differently: Iif officials can create processes that are flexible while retaining control over quality outcomes, citizens will receive more and better services. Managing public value -- not programs -- is the standard by which government should be judged.

Second, manage the flexibility/accountability tension. Clearly, rules provide the most direct route to protecting citizens, yet the existence of substantial, discretion-narrowing rules is the very phenomenon driving the inability of public officials to creatively solve public problems. Government's core competency is applying a narrow set of rules fairly and uniformly. What happens, though, when discretion becomes the necessary premium?

Third, design partnerships -- and the network -- purposefully. Defining how a network is governed dictates its design, and design often determines the success or failure of a networked approach. Providing a structure that facilitates the flow of information and resources within the network is critical, and technology is the glue that holds networked government together. Technology allows partners to share knowledge, business processes, decision-making, client information, workflow, and other data, which improve services to citizens.

As director of the IAG Program, increasingly I see the progress possible when government appeals to our cooperative -- as opposed to our combative -- instincts. It is the role of government to marshal and leverage all of the available resources to provide the best possible services for citizens. In spite of the challenges, the networked government approach provides a hopeful avenue towards improving the quality of important public services.

Government innovation is alive and flourishing at every level of government -- the IAG Award winners are a testament to that as well as to the creative, hard-working public servants who make these innovations happen.

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