Successful public service transformation – what works and why?

Everyday governments face the question – evolve or transform? Focus on well-defined shifts in ways of working within one department. Or radically transform government through new technology enabled business models.

Public service transformation was the subject of a recent Institute for Government (IfG) roundtable, sponsored by Sopra Steria, where senior civil servants identified principles for successful transformation. A lack of focus or clear objectives, inadequate resources, unrealistic timescales, departmental silos, limited insight from service users, unpredictable and changeable political agendas. The reasons for failed transformation programmes were many and varied.

But there were examples of successful transformation. Civil servants cited automatic enrolment to workplace pensions (more people are now saving for retirement), Getting it Right the First Time (reducing unwarranted variations in medical care) and Making Tax Digital (digitising the reporting of tax). There were also many examples – such as Universal Credit, NHS Vanguards and School Academisation – were it is just too early to reach a sound judgement. Transformation can take time.

In reality, high performing government agencies do resemble well-run companies. Both have worthy goals; well designed, rational processes; strict accountability; and effective leaders. But the profound differences in their purposes, their cultures and the contexts within which they operate conjure up different obstacles.

Transformation across government is arguably more difficult than the private sector. It is not possible to exclude a ‘difficult’ service user. Priorities change with new political leadership. Traditional structures tend to be hierarchical rather than flexible and agile. There is increasing political and media oversight. And there might be public opposition to novel efficiency initiatives such as remote video hearings or online pleas for minor offences or even divorce applications.

This means that transformation, through flexible new operating models designed around users and data, requires new thinking across government. Civil servants told us there was no ‘magic bullet’. Instead there is a need for empowered teams that deliver an agreed vision and work through a detailed plan. They have cross government support to remove systems and structures that undermine progress. There is a willingness to experiment, with pilots and early wins building credibility. And incentives, positive and negative, drive behaviours, including ‘invest to save’ schemes and the use of behavioural insights.

The suggestions made will play a formative role in the development of a ‘Transforming Public Services – 2020 and beyond’ research programme. I’d welcome comment on the this or any other issues raised in this post. And you might want to know more about our recent research with NIESR, where we asked whether the recent more upbeat assessment of the public sector finances was realistic.

Light at the end of the financial tunnel?

In March 2018 the government reached a significant economic milestone. It eliminated the deficit on its day-to-day budget. Tax revenues will exceed public spending. Public sector net debt will fall for the first time since 2001-02. It took eight years rather than five. But the primary target set by government in 2010, as the UK struggled to recover from the financial crisis, had finally been met.

The chancellor declared the nation was at a turning point in its recovery. He could see ‘light at the end of the tunnel’. Some commentators suggested the light might be an oncoming train, pointing out that economic forecasts rely on the government following through on ambitious plans for further spending cuts.

What does the economic evidence tell us?

We recently asked the National Institute for Economic and Social Research (NIESR) to help us understand if the upbeat economic message was justified.

They told us that if government is to achieve its ambitious target of a balanced budget by the middle of the next decade, public spending as a share of Gross Domestic Product (GDP) would need to fall to 36.6% in 2022-23. The post-war average is 39.3% of GDP.

Since 2010, significant savings have been made by transforming how government works, through commercial reforms and reducing the costs of major projects. However, the evidence is that public sector pay restraint and relatively low levels of public spending, rather than widespread productivity gains, explain the vast majority of deficit reduction.

What future do public services face?

We then asked NIESR to suggest how sustainable these savings might be. They told us government faces a daunting challenge. Why?

First, continued pay restraint is unlikely to have the same impact. The across-the-board 1% pay cap has already been lifted. And there are signs in health and education of recruitment and retention problems. Second, there are signs that low levels of public spending might be affecting the quality of public services. For example, the Institute for Government have noted a marked deterioration in key government targets for health and public safety. And third, most significantly, the pressure from further ageing of the population is gradually building. Significant extra resources will be needed to cover raising health and care costs and serve a larger number of pensioners.

NIESR used a series of scenarios to reveal the economic strain that government might experience over the next seven years. They warned that a public spending gap of up to £300bn could emerge, created by the cumulative impact of an ageing population and the cost of easing austerity.

Of course, it is possible that the economy will improve significantly, lifting tax revenues and providing an opportunity to increase public spending and reduce debt (the government still owe more than £1.6 trillion). But this cannot be counted on and it would be better to consider other options.

What options are open to government?

To meet this challenge, the government will need to embark on a transformation programme on a scale unprecedented in the post-war era. The combination of fiscal consolidation and rising expectations for service delivery represents both an opportunity and an imperative to radically redesign the services government provides to the public.

Government have already started digitising front-end interfaces, processes and workflows to improve cost efficiency and user experience. The next step is to reduce duplication of structures and resources between and within levels of government. And this requires a change of mindset – from government and industry. Rather than simply implementing bits and pieces of technologies on their own, there is a need for equally necessary organisational and service design changes. And this means joining up and trying to de-silo processes, creating new processes that do things once rather than many times.

In launching a new strategy for the government business last week, Sopra Steria commits to using our understanding of the public sector and emerging technologies to introduce a series of platforms for government, focussed on core government activities, which are standardised and repeatable. They will enable government to re-engineer, streamline and automate policy processes (including those enabling the UK’s exit from the EU).

Further information on the strategy launch and the NIESR research can be found on the Sopra Steria website. As always, I would be grateful for your thoughts and suggestions on how public services should be reformed.

Still making difficult decisions – the Spring Statement

In 2010 the coalition government started with the objective of eliminating the structural current deficit by 2014-15. It introduced a package of savings, a public sector pay freeze, welfare reforms and significant reductions to every department’s administration budget. There was still a desire to protect the most growth-enhancing capital spending.

The target originally set by George Osborne when he imposed austerity on public services was only achieved this year. Paul Johnson, director of the Institute for Fiscal Studies, said the deficit reduction was still ‘quite an achievement given how poor economic growth has been’.

What are the lessons of the last eight years?

As the Chancellor gives his ‘no frills’ Spring Statement this week, and prepares more far reaching plans for tax and spending through his Budget in the Autumn, it is worth drawing some conclusions on how the government eliminated the deficit and what aspects of the austerity agenda should remain:

  • The government maintained a clear and measurable fiscal target (the Chancellor has made a ‘pledge of fiscal responsibility, to borrow no more than two per cent of national income by 2020-21) and the Office for Budget Responsibility (OBR) should continue to assess publicly whether this is likely to be achieved.
  • The departmental spending review prioritised areas with benefits to a broad sweep of society – next year’s review should promote growth (like transport and education) and fairness and social mobility (providing routes out of poverty for the poorest, improving incentives for work and tackling ‘wicked problems’ such as the increasing public health hazards of air pollution).
  • Eliminating a sizeable deficit was not a normal budget exercise and a more open and inclusive approach is required – government should consult widely, beyond departments, asking public sector workers and the public to suggest ideas, convening expert advisory groups and holding regional events to listen to people’s views.

Of course, external conditions are now favourable and the reforms introduced in 2010 (including spending controls, back office shared services and commercial reforms) have been sustainable. But the United Kingdom cannot rely on external conditions to remain as favourable as they are now. Particularly as uncertainty lingers about the UK’s future relationship with the European Union and the economic costs of divergence with the EU become clear.

What needs to change? Meeting the UK’s future challenges

The squeeze on public services is showing up in higher waiting times in hospitals for emergency treatment, low satisfaction for GP services and a staggering decline in prison safety. The National Audit Office (NAO) warned that local councils are at financial breaking point. If they keep draining their reserves at the current rate, one in ten will have exhausted them in just three years’ time.

The improvement in the public finances gives the Chancellor some leeway to spend in his Spring Statement. But the expected £5bn to £10bn windfall is not going to transform the delivery of public services. It is not enough to solve the UK’s long-term fiscal challenges. For example, demographic change will demand either a significant increase in taxation or a radical change to the funding of health and pensions. There is an immediate need to put the funding of social care on a sustainable footing

Achieving better internal efficiency is a necessary but not sufficient part of public service reform. At the same time public services must come up with innovative, less resource-intensive and more effective ways of achieving the government’s aims. In the Spring Statement, the Chancellor should provide funding and direction:

  • To move away from the traditional tools of legislation, regulation and taxation – which can be expensive to design and implement – and develop and apply lessons from behavioural science (designing policy that reflects how people really behave).
  • To renew the transparency agenda, as a way of achieving ‘better for less’ – by consistently releasing data into the public domain, individuals are able to draw their own conclusions on the way public services operate, incentivising efficiency through accountability, and stimulating innovation through ‘information marketplaces’.
  • And, where appropriate, for public services being open to a range of providers competing to offer a better public service, with a greater emphasis on outcome-based contracts, and joint work with the private sector to access private capital and expertise to make fuller use of core public assets in an enterprising way.

A final thought – accountability and public services

I appreciate that the third suggestion is not shared by everybody. Over the past five or six years problems have emerged in the UK public service market, particularly in the commissioning of complex services. This came to a head with the liquidation of Carillion.

The reality is that the public are more pragmatic than the politicians. For example, sixty-four per cent of people do not think it matters who runs hospitals or GP surgeries ’as long as everyone has access to care (Populus poll, January 2018).

But we still need to recognise that one of the most important differences between a private and public service is the different and often enhanced levels of accountability for the delivery of that service to a broader range of stakeholders. Private sector organisations that want to deliver public services have to be aware of, and work within those boundaries.

There is an urgent need for a more transparent and robust way of measuring the quality of services provided by the public and private sector. The Chancellor should ensure the rapid implementation of Sir Michael Barber’s report into improving value in public spending.

Shifting from analogue to digital public services – citizens want joined up public services

I highlighted the positive view citizens have about digital public services in my last blog. And their appetite for more. I now want to address some of their concerns and why doubt the ability of government to continue to deliver.

The digital disruption brought about by new technologies is transforming the interaction between citizens, business and the public sector.

Citizens compare public services with innovative platform business models provided by digital trendsetters like Apple, Google and Amazon. I expect simplicity and even friendliness when I talk to Alexa or Siri.

What did we find? Government needs to join the dots

This year’s research shows that digital public services fall short of the best commercial services. While 64% of UK citizens said digital public services were advanced this falls to just 30% when they are asked to compare them to commercial services.

The UK Government can take some comfort from the comparison with France (18%), Norway (19%) and Germany (20%). And of course, we understand that governments face unique challenges, as ‘customers’ often have no choice when using public services that can be a last resort.  Governments need to address complex and long term needs like the reduction of re-offending or the treatment of chronic health conditions.

But citizens told us of their frustrations about the need to input information many times, including various passwords, the multiple steps needed to access services and an inability track progress. Some of these issues are being addressed by the UK Government, including through new platforms such as Verify and Notify. And they have flagged an intention to ‘improve citizen service across channels’ through a new Transformation (not digital) Strategy.

However, too often governments fail to meet citizen’s expectations when it reproduces its analogue bureaucratic procedures in a digitised way. Siloed service delivery approaches, with multiple websites and fragmented service delivery, organised around internal institutional structures are no longer acceptable. Which is why the number one priority for 44% of the UK citizens surveyed was the creation of a one-stop digital portal for undertaking interactions which need to be performed with multiple agencies (and this was a common priority across France, Norway and Germany).

Improving the experience of citizens in a revolutionary way

Citizens expect their public services to be designed with a user-driven perspective. And to adapt to different user profiles and needs. Through intelligent re-use of data and information previously generated or provided by citizens, governments can shift from reactive to proactive service delivery practices.

In a reactive service, the citizen is always responsible for starting the service demand, properly identifying herself and providing the required information. In a proactive service, the public sector knows its citizens, knows their life circumstances and current needs, and provides them the space to voice and signal their requests and preferences.

This enables the public sector to serve citizens in a personalised fashion about their rights, their duties and the services available. And to reach out to them to receive the authorisation to complete the service on their behalf.

This capacity to collect, combine and process data in a coherent way to better serve citizens must be a key feature of digital public services. And this needs a whole-of-government effort to exchange information across the public sector. With the key building blocks – common architecture, interoperability framework, digital identity system – in place to enable integrated service delivery.

Developing a user-driven approach also implies that the public sector’s capacities, workflows, business processes, operations need to be adapted to the rapidly evolving digital age. The challenge is not to introduce digital technologies but to integrate and embed them right from the start into efforts to modernise services.

I’d like to hear your views on how policies can be made digital by design, mobilising new technologies to rethink and re-engineer processes or open new channels of communication and engagement with citizens. And feel free to get in touch if you’d like more information on our research with Ipsos.

Citizens can feel the benefits of digital public services but are concerned about the ability of government to keep pace with their needs

As companies have transformed themselves with digital technologies, citizens are calling on governments to follow suit.

By digitising, the public sector can provide services that meet the evolving needs of citizens, even in a period of tight budgets and complex challenges.

This is the second year that Sopra Steria has asked the researchers at Ipsos to conduct a survey of 1000 citizens, from a broad range of social groups and across the United Kingdom, to understand their experience of and expectations for digital government. The same survey took place in France, Germany and Norway. So we have an opportunity to compare how citizens in the UK experience digital with others across Europe.

What did we find?

Citizens expect public services to be designed and delivered in a simple and intuitive way.

This year’s research shows that citizens recognise the efforts made by governments to use digital channels to streamline their interactions. 64% of the UK citizens surveyed described digital public services as advanced, compared to just 42% in Germany, 66% in France and 75% in Norway. The UK Government should seek to learn from experience of Norway, which has long used technology to streamline processes.

We asked citizens to describe the current degree of digital service development across Government

Citizens continue to support investment in digital public services. 75% of citizens surveyed in the UK said government should press ahead with plans to digitise public services. 25% described this as ‘an absolute priority’. Health is judged the most important public service to digitise in the future. 54% of citizens in the UK said health was the priority for investment, an increase of 5% in the 12 months since the last survey.

The research found that citizens also recognise the positive impact digital is having on the quality of public services. 58% of the UK citizens surveyed said that the introduction of online channels and services had improved the quality of public services, compared to 53% in France, 65% in Norway and 57% in Germany.

So far, so good – but what about the future of digital public service delivery?

Governments are working on simplifying access through the development of simple organisational hubs for digital government services. Fully developing this approach requires governments to achieve significant levels of interoperability of public sector information systems and, at times, cross-organisational service solutions.

Citizens are cautious when asked about the prospects of making further progress. 47% of the citizens surveyed said they did not believe the public sector had the necessary skills to make progress (which is similar to our own survey of civil servants last year). And France is the only country surveyed where citizens expressed confidence in their government’s will AND ability to continue to make progress.

We asked citizens for their views on the will and ability of governments to make progress with digital public services

The UK might learn from France and other countries that are seeking to introduce incentives across the public sector to help bring down cultural barriers in hierarchical and centralised administrative cultures. And develop a human resources strategy that helps develop, attract and retain vital data skills that facilitate collaboration.

In my next blog I will be looking in more detail at why citizens are so cautious about future prospects for digital public services. And how governments can address their concerns and shift away from the ‘vending machine’ model of service delivery.

In the meantime I’d like to hear your thoughts on the survey, including great examples of digital public services and how obstacles were overcome. And get in touch if you would like further details of the survey.

Using digital technologies to address complex problems – what can we learn from other governments?

It goes without saying that governments face incredibly complex challenges. Sustaining cohesive communities in the face of demographic, economic, security and other challenges will test the ingenuity of politicians and civil servants.

In recent blogs I’ve questioned the industrial-age organization of government and highlighted how the private sector is improving services through digital technologies. Now I would like to shift the emphasis and highlight how governments around the world employ digital technology to drive problem solving.

And I will start by looking at the one of the most significant problems facing individuals, families and communities – mental health.

Nearly one fifth of the UK population have a mental health condition

Mental health conditions cover a wide range of disorders and vary from mild to severe problems. The most common types are anxiety and depressive disorders (9% of all adults). More severe and psychotic disorders are much less common.

Recent research has found that a third of fit notes (they used to be called sick notes) issued by GPs are for psychiatric problems. The employment rate for people with mental health conditions is 21% compared with 49% for all disabled people and over 80% for non-disabled people.

Almost half of benefits claimants of Employment and Support Allowance in England are receiving payments as the result of mental and behavioural disorders. Recent independent studies estimate that cash benefits paid to those with mental health conditions are around £9.5 billion a year and administrative costs are £240 million.

This illustrates the financial costs of mental health conditions. But it fails to address the personal impact on individuals, their families and the wider community. That is why the NHS is putting mental health front and centre, in what was recently described as ‘the world’s most ambitious effort to treat depression, anxiety and other common mental illnesses’.

Using technology to create community solutions

Although overall spending on mental health will rise by over 4% in 2017/18, many areas of the country are under pressure to provide enough high quality services.

We also know that mental health is a very complex problem that goes beyond the capacity of any one organisation to understand and respond to. There is disagreement about the causes of the problems and the best way to tackle them.

Which is why Creating Community Solutions is such an exciting project.

In the US, following the Sandy Hook tragedy, the Obama administration launched a national dialogue on mental health. It soon became clear that, while mental illness affects nearly every family, there is a continued struggle to have an open and honest conversation around the issue. Misperceptions, discrimination, fears of social consequences, and the discomfort associated with talking about such illnesses all tend to keep people silent

The challenge facing the administration was how to convene a national participation process that would help Americans to learn more about mental health issues, assess how mental health problems affect their communities and younger populations, and decide what actions to take to improve mental health in their families, schools, and communities.

Officials from across the administration collaborated under the umbrella of Creating Community Solutions. They designed an online platform and process that integrated online / offline and national / local levels of collaboration. The platform has promoted a nationwide discussion on mental health. It has given Americans a chance to learn more about mental health issues – from each other and from research. For example, in December last year, and all over the country, hundreds of thousands of people used their mobile phones to get together in small groups for one-hour discussions on mental health.

What can we learn from the US?

Creating Community Solutions is an amazing example of how technology can be used overcome barriers, give access to relevant information and promote participation and mutual support. As a platform, rather than a conventionally structured project, it straddles traditional administrative boundaries and provides support in a distributed way.

I’d like to see our government adopting a similar approach, using technology to break down hierarchical barriers and using platforms to promote collaboration across public services and with communities.

I’ll be writing about other innovative ideas in future blogs. In the meantime, do you know of other innovative solutions to complex public problems? What are the exciting ideas informing your own work —particularly if you are working in the public sector – and how are you implementing them?

Let me know in the comments below or contact me by email.

Are we truly working together?

Government wants to work smarter with citizens and deliver high quality end-user services that provide transparency to the end user through omni-channel and cross-organisational working.

A key word to aid this, is ‘collaboration’:

  • Collaboration between service providers and users (through user research, user testing, product increments, etc)
  • Collaboration between organisations (sharing of data, joint decisions on process development, sharing human and technical resources)

Or at least that’s what we think it means. Considering the two main definitions perhaps we can understand why there is confusion on what collaboration actually means:

1. work jointly on an activity or project
2. cooperate traitorously with an enemy

Working on cross organisation projects to improve the sharing of information I’ve seen issues with this in practice. Collaboration should be 1, but sometimes appears more as 2. Why is this?

In my experience people are willing to ‘work jointly’ as long as their own organisation’s agenda isn’t put at risk. Consider from my previous blog post ‘Lead by listening’  when I suggested that it’s “important not to be too protective of your domain. If a decision elsewhere could greatly affect your area of the business, but is better for the positive growth of the organisation, then perhaps embracing the change is the better option?”

Surely this must be true for effective cross-organisation collaboration. What I see in reality is programmes of work that stall with the realisation that one organisation’s vision or current way of working may suffer distruption even if it’s for the common, overall good. Often we arrive at this junction where one organisation must invest for another to save.

perhaps we need to re-define what collaboration means.

Perhaps we need to include empathy in how we collaborate. By stepping into the shoes of our partner organisations and seeing how proposed changes affect them directly could help us understand how to genuinely work together to make the positive change we seek. If we can’t manage this then we’ll find we need to re-invent the definition of collaborate:

Collaberate : verb. (collaborate merged with berate) – being happy to work together, right up until the point you feel your domain is threatened by those you were collaborating with, and then turning on them.

Let me know what you think by leaving a comment below.