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1. Module 6
Innovation for the Public Sector of
the 21st Century
PRESENTER

2. Innovation as embedded
process
Innovation does not happen in a
vacuum. It is tied to individual and
organizational elements that affect
the capacity of an organization to
develop innovative processes and
outputs.

3. Innovation as group activity
 Innovation is seldom if ever the work of a
lone individual.
 Innovation is most often found to be the result
of a group approach where the team, as
opposed to the individual, is key.
 It is a very rare occasion where an ‘island’ is
the source of an innovative process.

4. Innovation: ideas, people and
processes
 Innovation is about doing things differently
and/or doing different things.
 It is not necessary to develop a working cold
fusion reactor to be innovative: sometimes
reworking how a policy is delivered can change
millions of lives for the better.
 People, their ideas and the processes through
which they are implemented form innovation.

5. People Process Ideas

6. Generating Innovation
 Many organizations look at leaders to create innovation.
 This provides both benefits and challenges;
 In the West the figure of the leader is often equated to
a solitary individual, leading with a top-down
approach.
 Leadership is unevenly distributed both within and
among organizations.
 The focus is not on innovation but on leadership.

7. Innovation Leadership
 In the private sector the recently
developed theory of Innovation
Leadership, has received a lot of attention.
 The theory models three dynamic and
iterative stages leading to innovation:
 Idea Generation
 Evaluation
 Implementation

8. Idea
Generation
EvaluationImplementation

9. Building Innovative Teams
 In a very real way creating innovation is
about building innovative teams
 Therefore, hiring and having on your
team people with innovation-friendly
characteristics and skills is very
important.
 So is creating an innovative
environment.

10. Types of Innovation
 Value-added Innovation: it is about
revising and changing already existing
products/processes. It does not require a
large amount of risk taking.
 Exploratory Innovation: it is about truly
new ideas. It is premised on a risk taking
approach and on the flexible and very
diverse structures when ‘contamination’
among ideas is key.

11.  The environment in which innovation
emerges is very complex, with variables
affecting the ultimate output that include:
 Levels of encouragement towards innovation
 Degree of autonomy
 Available resources
 Creativity levels of the workforce
 Characteristics of the leadership

13. Will innovation training fail?
 As innovation becomes increasingly a
buzzword, training for innovation becomes
more common.
 That training tends to focus on building
leaders and often tends to fail:
 You are focused on training leaders to
lead people, rather than training leaders to
build and lead systems (Doss 2013)

14. The Innovation Syllogism
 Henry Doss argues that we should focus on
systems and culture rather than on
individuals for innovation:
1. Innovation is a product of culture (not individuals).
2. Culture is an emergent factor of systems (not
individuals).
3. Therefore, systems drive innovation (not
individuals).

15. The Characteristics of Innovative
Cultures
 So, when we attempt to foster
innovation we would be well advised
to remember that innovative cultures:
 Exhibit very high levels of trust;
 Exhibit very high levels of
diversity;
 Encourage risk and understand
failure.

16. Critical vs. Creative thinking
CRITICAL THINKING
(Vertical)
CREATIVE THINKING
(Lateral)
One answer
Begin with one
problem, numerous
data
Brainstorming processes, free association,
etc.
Begin with one
Generate
problem or
numerous
question
possibilities
Mathematical
processes
Logical
thinking
processes
Brainstorming
processes, free
association,
etc.

17. Contaminate your thinking…
 In Borrowed Brilliance, David Murray claims,
…the farther away from your subject you
borrow materials from, the more creative your
solution becomes
 Murray is fond of saying: First you copy. Then
you create.
 The key is freshness of perception and a
willingness to tinker with our mind sets—the
way we ‘normally’ see things.

18. Innovation in the
Public Sector

19.  The devolution of responsibilities, client-
centered approaches, and strong focus on
satisfaction- and result-based
assessments typical of the most recent
phase of New Public Management
increasingly make public managers
answerable for crafting rather than just
implementing policy choices

20.  The most efficient way to answer the
seemingly conflicting demands of better
client-centred approaches and shrinking
budgets is to foster innovative problem-
solving within the public administration by
triggering untapped capabilities through
innovation ecologies and the spread of
institutional entrepreneurship

21. Future Administrative Priorities
 Decentralization and devolution of the public
sector;
 Emergence of network/collaborative government
practices built on participatory and consultative
processes;
 Increased customer-orientation in public sector
governance
 Citizens expectations are moving from a
notion of being “engaged by” government to
“participating with” government.

22. Insight #1;
Need for Leadership Capacity and driving Change Management in an era of fiscal
challenges
 90% of survey respondents stated that Building
Leadership capacity is an important HR priority
 #1 priority for each of the four countries in
scope
 Notably higher in NZ (96%) and lower in UAE
(82%)
 UAE looks more like building supports,
continuous improvement
• Room for improvement in coaching and
leadership development tools
 A close second priority in importance rating is
Driving Change Management (82%)
 #2 priority for Can/Aus/NZ, #4 for UAE
 Perhaps related to demographics – large
majority is C/A/NZ is 40+ (>80%) whereas only
~47% is over 40 years old in UAE
 Driving Innovation also achieves more that 80%
rating as an important priority
22
0%
20%
40%
60%
80%
100%
Building
leadership
capacity
Driving
change
management
Driving
innovation
Building
human
resource
capability at all
levels
Developing
succession
planning
Enhancing
attitudes
and values of
staff
Implementing
organizational
restructuring
Very important
Important
Moderately important
Of little importance
Unimportant
Implications for Public Sector Leaders:
• What ability do government have to hire the “right” staff
• What training and leadership development is required
• Can HR capability be enhanced despite fiscal constraints
• Need to work on identifying future managers / leaders
Personnel development and human resources issues
Source: Public Sector Executive Survey, Question 5 Over the next 2 years, how
important will be the demand for the following personnel development and human
resources issues for your organization?, n=1,503
Given other immediate priorities,
government is not fully prepared to
build the next generation of leaders

23. Resistance and Need
 The public sector is often depicted as
being inherently resilient to innovation.
 Nonetheless, increasingly internal and
external trends are forcing the public
sector to innovate.
 The question is how this innovation will
take shape, not if it will take shape

24. Innovation vs. optimization
 Both concepts are applied to organizational design
but they are partially incompatible.
 Often, optimization is premised on very specific
end goals and follows a set of very well defined
mission statements and practices.
 Innovation responds to a more open-ended
process, where there is the recognition that the
problem at hand requires a deeper change than a
simple adjustment in process flow.

25.  Optimization and innovation should be
thought of as laying on a continuum that
goes from very small process adjustments
to truly radical changes.
Optimization Innovation

26. Policy Innovation in a
nutshell
 Policy Innovation should be thought of as
having three facets:
 invention
 diffusion
 evaluation
 Together they determine the scope and
reach of policy innovation.

27.  1. Invention: or the emergence of new policy
elements. This is generally very rare: incremental
evolution or mixes of new and old policies are the norm
(Kingdon 1995).
 2. Diffusion: representing the entry into wide use of
these policy elements. Adopting policies that someone
else has developed is a very important source of novelty
(Walker 1969).
 3. Evaluation: which refers to the projected and/or real
effects through which a policy will change the lives of a
certain group (Jordan and Huitema forthcoming).
 the actual difference between the old and new policy,
 the effect upon target groups and policy actors, and finally
 how policy affects other forms of problem solving and
control to modify the environment in which the issue exists
and encourage the ‘reduction’ of the problem at hand to
more manageable terms.

28. Risk
Management
Resilience
Innovation

30. Risk Categories

31. Manage Risk at all Levels
Program
Field
Corporate
Strategic Decisions
Decisions transferring
Strategy into Action
Decisions needed for
Implementation

32. Managing Risk in Organizations
 A robust process for managing
organizational risk involves three steps:
 Step I - Clarify your goals and critical stakeholders.
 Step II - Before deciding how to proceed with activities:
identify, prioritize and act on uncertainties.
 Step III - Review and communicate uncertainties.
Risk
Identification
Risk
Assessment
Risk
Response

33. Risk Assessment
 Scan the environment
 Capture both cause
and effect
 Involve stakeholders
 Determine risk
ownership
 Horizon scanning
 Assess risk
 Create Risk Matrix
 Assess Vulnerabilities
 Determine levels of
tolerability

34. Risk Matrix

35. Define your Risk Tolerability
Low
Likelihood
Medium
Likelihood
High
Likelihood
Minor
Impact
Moderate
Impact
Significant
Impact

36. Prioritizes and communicate
 Communicate risk
appropriately and
focus on the priorities
that most affect your
program.

37. Act on your Risk

38.  Tolerate: accept the risk by keeping activities
unchanged. This option may be applied when exposure
is tolerable, control is impossible or cost of control
exceeds potential benefit. It may be supplemented by
contingency planning for handling the potential impact.
 Treat: adjust (add or revise) relevant activities;
 Transfer: share the risk by involving stakeholders.
Transferring risk works especially well for financial risks
or risks to assets, e.g. by taking conventional insurance
or paying a third party to take the risk. This option is not
possible for reputational risks. The relationship with the
third party needs to be carefully managed.
 Terminate: avoid or cancel the activities that give rise to
the risk by terminating the activity that gives rise to the
risk, especially when the cost/benefit relationship is in
jeopardy

39. CLASS EXERCISE BEGINS
BELOW – PLEASE PRINT THE
FOLLOWING PAGES AS A
BOOKLET FOR EACH
PARTICIPANT AND DELETE
FROM SLIDE DECK
THANKS

40. Exercise: Prepare a risk analysis
for an innovation program
 1. The Permanent Secretary has given
your unit the responsibility to create a
policy innovation unit.
 As part of the exercise you are to prepare
a risk management strategy.
 Use the next 15 minutes to individuate
the key corporate, program and field
risks.

41. Program
Field
Corporate

42.  Now, we shall try to assess one or more
our risks in a class conversation. Bear in
mind our risk categories
And risk matrix

43. Description of Risk Type of Risk Likelihood of
risk
Impact of
Risk

44.  As a final exercise let’s pick one risk and
attempt to design a risk mitigation strategy

45. Risk Inherent
Assessment
Controls
in place
Residual
Assessment
Further action
planned
Risk
owner
Impact Likelihood Impact Likelihood

46. Risk Inherent
Assessment
Controls
in place
Residual
Assessment
Further action
planned
Risk
owner
Impact Likelihood Impact Likelihood