Desperately seeking Susan In search of innovation in

‘Desperately seeking Susan. . ? ’ In search of innovation in the New Public Governance Professor Stephen P Osborne, Chair in International Public Management, University of Edinburgh Business School, Scotland

This presentation • Genesis of the New Public Governance (NPG) • Key challenges of the NPG • Enabling innovation under conditions of the NPG • ‘The one-liner’

I - Genesis of the NPG • Public Administration (PA) • The New Public Management (NPM) • The New Public Governance (NPG) • Not a linear history but a layering added complexities

Public Administration • Focus on implementation of public policy and administration of law • Politics-administration dichotomy – Flawed in enactment – Public officials as self-serving elite and little genuine citizen engagement – Inefficient allocation of public resources

New Public Management • Management of public services not administration of policy, with disaggregation of services to units/unit costs • Focus on efficient allocation of public resources and (variable) focus on markets and competition • Performance management and output control • Re-casting of citizens as customers • Draws upon managerial theory developed from experience of the manufacturing sector – A product-dominant and intra-organisational business logic

But… • ‘The world has changed’ – Fragmented – No longer possible for one organisation to meet social/economic need in isolation • Current public management theory not ‘fit for purpose’ , if it ever was – Policy not service-user focus – Product not service orientation (outputs not processes) – Intra-organizational focus in a plural and pluralist world

New Public Governance (Osborne 2006, 2010) • Acknowledges fragmentation of needs • Embraces plural and pluralist service delivery • Focus on inter-organisational relationships and service systems • From administration and management to negotiation and governance – Of needs, service delivery, and outcomes • Service users as co-producers • A different, service-dominant business logic (Osborne et al 2013): beyond the ‘missing product’ of public services delivery

Two caveats… • NPG is not a normative term but a descriptive and evaluative one • NPG does not replace the administrative or managerial imperatives of PA or NPM – it adds a new layer of complexity that conditions the other two

II - Key challenges of delivering public services under conditions of the NPG • Beyond product-dominant to (public) servicedominant business logic • Beyond silo organisations and interorganisational relations to public service systems • Beyond policy dominance to a user orientation

A public service-dominant business logic (Osborne et al 2013) • Public service delivery is not a process of manufacture but of service realisation – Public services are not tangible goods: there is no ‘missing product’ but a process of service delivery – Public service delivery is about the transformation of (professional) knowledge to produce added value for end-users (Lusch & Vargo 2006) – You cannot separate production from consumption: all public services are co-produced by users and staff – The service system is the key unit of analysis

The service system • Beyond inter-organisational working to service systems – Public policy creation is a pluralist process: negotiation between stakeholders – Public service delivery requires plural elements: public service organisations, staff, hard and soft technology, end-users, communities… – Not just inter-organisational working and networks but service systems • Moving from closed and natural systems to open systems – A process of negotiation and governance to produce public services

Making a reality of ‘user orientation’: Co-production • ‘User orientation’ and co-production a long time goal of public policy • BUT – Seen as an add-on, under professional/political domination • The reality – (public) service-dominance logic identifies co-production as an inalienable element of service delivery: this way to ‘best practice’… – ‘The lunatics are taking over the (public policy) asylum…’ (Bekker et al 2011) – Towards consumer, participative and enhanced coproduction (Osborne & Strokosch 2013)

NPG: five implications for innovation I • From manufacturing design to process governance: from the ‘missing product’ to ‘realising the promise’ (Osborne et al 2013) – ‘Hard’ innovations can support public services but. . – Away from R&D and technocratic dominance – Meshing user expectations and experience to produce performance • From rivalrous competition to open (collaborative) innovation – Share risks, costs, knowledge - and benefits

NPG: five implications for innovation II • Innovation is socially constructed within social systems (Osborne & Brown 2011) – What is acceptable? • ‘Pin down’ and biometric ID • Risk is (also) socially constructed (Brown & Osborne 2013) – From technocratic risk management to risk governance – Who are the stakeholders? – How much risk, for what benefit?

NPG: five implications for innovation III • The user is at the centre of public service innovation (Osborne & Strokosch 2013, Radnor & Osborne 2013) – Co-production not an ‘add-on’ but the driver – ‘Sticky knowledge’ plus professional knowledge leads to innovation – From R & D and policy dominance to understanding the reality of co-production in service systems • Beyond the technocratic and political imperatives to innovation rooted in a public service-dominant logic

The ‘one-liner’ for the NPG? • Service users (not technocrats, politicians or professionals) are at the heart of the public service system and drive public service innovation across that system – Their needs, their public services, their innovations, their outcomes