Latest predictions are that annual Federal Civilian agency spending will reach $52.0 billion by the end of FY18, and 79% of those funds will go into operations and maintenance, crowding out funds for development, modernization, and enhancement of technology systems.
December 12, 2017, marks an important step in addressing this: It’s the day the federal government’s “Shark Tank” was established to enable the government to leap into the 21st century with projects that modernize agency technology and generate savings via money pooled in the new Technology Modernization Fund. As it stands, three agencies are set to receive $45 million between them for various modernization projects.
Public sector meets private-sector innovation
There is an increasing demand for government to act like a business – know what you have, produce results, and invest strategically. The public and private sectors differ fundamentally in their purposes: the public sector aims to provide, protect, and prosper, whereas the private sector aims to make and grow profits. This notion is driven largely by a shift in expectations of constituents for innovation and ease of use, set by the private sector, where sharing information and conducting business is a simple and seamless experience.
Shifting the gears of government
What is it about government that makes it ever-so-challenging to innovate? How can they be better positioned?
1. Siloed and fragmented agencies with little synergy
These force constituents to work to understand their government, whereas cross-agency collaboration increases the likelihood of providing services that serve constituents holistically. This often leads to innovative solutions that can better serve constituents that they easily identify with to improve overall public sector performance.
Due to the risk-averse nature of government, the challenge is that even the best-intentioned efforts are quickly overcome by process and rigidity. The process of innovating means dealing with uncertainty, and this calls for proving and testing ideas and solutions. It is incumbent upon public sector decision makers to focus on finding a balance and to allow for experimentation within acceptable levels of risk so that public employees are not skeptical or fear failure associated with innovation.
3. Human capital management
Innovation is made possible when people work in an environment that allows for new ideas and enables them to apply their knowledge and skills. Empowering talent to leverage their skills is an improvement over the current top-down, follow-procedures type of environment. Engaging work and leading-edge opportunities will be the biggest attraction and retention strategy of a public sector competing for the best talent.
Perhaps there is a middle path for government, as I have experienced with public sector and international organizations that have adopted private-sector strategies:
1. Incorporate industry best practices
Tighter collaboration between industry and government can bring greater returns in outcome and cost management. One of the more challenging aspects of innovation is the cultural shift needed to hold agency leaders accountable for the total cost of ownership of the applications or services they manage by assessing full costs, including administrative costs.
2. Benchmarking to improve mission-support operations
With the benchmarking data, agency leaders can compare their own data to other, similar agencies and evaluate performance in terms of the cost and quality of their mission support services. They can then ask evidence-based questions and strategically assess tradeoffs. A public transportation agency using benchmarking got a better understanding of costs and other key metrics, and this has led to better outcomes that were not previously possible.
3. Develop small-scale prototypes to explore potential solutions
Emerging technology like blockchain promises to help government improve service and regain trust. Building a prototype and working in a timeboxed fashion to develop a cost-effective working model that goes through several iterations of validation with the stakeholder community increases the chances of a success. A development aid agency is exploring blockchain, for example, to make cash transfers to organizations supporting women in fragile states. The agency can significantly cut costs, control financial risks such as fraud, and respond more quickly to emergencies. Donors also want to see where the money is going and how it is being used at any given time.
4. Leverage design-thinking to develop a user-centered design to problem-solving
Approach the use of design thinking from a private sector perspective, but insights can apply to government as well. Sometimes the efforts can be as simple as the Office of Strategy & Innovation working with program personnel at an international public sector organization to improve programmatic execution and cost in support of the mission. Applying this design process uncovered insights into unique experiences, systemic challenges, and unmet needs that hinder program effectiveness.
5. Building a workforce of public sector innovators
Innovation in government, whether it’s new technology, new digital services, or new processes will not be adopted and used by people outside government. Public employees are the cornerstone of public sector innovation. It is widely accepted in government that people and culture emerge first and foremost as critical to shaping innovation. In working with a cabinet-level security department, the approach has been a people-first agenda providing them tools to promote an innovative and learning culture underpinned by data-driven, transparent, and objective decision-making.
Beyond innovation one-offs
The challenges notwithstanding, public decision makers are innovating to provide a path to broader constituent engagement, empowered employees, and new digital technologies that will provide better access to data and services. To further strengthen the existing model and increase impact, tracking lessons learned and spreading effective strategies need to take place across government. A community of government innovators, mission-focused and working with the most relevant programs, can build and sustain a new culture of government innovation that goes from ad hoc to every day.