Creating public value

Organization design and development in the public sector has been to front of mind this past week. I was running a public CIPD course in organization design with a mix of private and public sector organizations. I then went to speak at a city council conference on emerging trends in organization design, and then on to run an organization development Master class for a government department. The common thread through the public sector employees was the question of how to deliver value in extremely challenging and very fast moving contexts.

A year or so ago there was an article in the Economist The Gods that Have Failed – so far, that muses on a similar question 'Could technology and good management bring the public-sector up to scratch?' In the article bringing the public sector 'up to scratch' requires seizing two opportunities: a) changing what the state does; and b) changing its structure. The article then goes on to outline why seizing the opportunities is a whole lot more difficult that it might seem to be. Various reasons for pessimism are discussed:

  • "Productivity in government is difficult to measure and statisticians have generally stopped trying to come up with precise figures".
  • The public sector has experienced the Baumol Effect (involving a rise of salaries in jobs that have experienced no increase of labor productivity in response to rising salaries in other jobs which did experience such labor productivity growth).
  • Public sector organizations do not have to respond to competitive pressures in the same way that private sector organizations do.
  • Bringing skilled business people into the public sector world does not seem to produce the hoped for results.
  • There's an interesting statement that "There are even ideological reasons why liberals in particular should want to keep the state relatively inefficient."

Changing what the state does could be relatively simple but there are the vested interests that make changing things like farm subsidies or pension arrangements very difficult. Changing the structure of public sector organizations is suggested to be easier to tackle in the long run, and this discussion was at the nub of the work I was doing during the week. However, having worked in a government agency myself over the past two years I've learned that changing the structure and modus operandi is no piece of cake either.

So in preparation for the week's sessions I read a book that has just come out 'Managing Local Governments: Designing Management Control Systems that Deliver Value' by Emanuele Padovani and David Young. This book opens with the brave statement that it does not 'purport to describe, or even support, business as usual. Instead we argue that local governments in general are poorly managed and do not provide anywhere near as much value to their citizens as they could by making some (often relatively minor) changes in how they conduct their affairs.' The chapters that resonated for me in terms of organization design and development work were the one 'Barriers to Effective Management Control in Local Governments', and 'The structure for management control'. I was talking about this book to a participants in one of the session and he recommended two other books, this time by Mark Moore, on the topic. One published in 1997, Creating Public Value: Strategic Management in Government, and the other a more recent one (2011) Public Value: Theory and Practice by John Benington and Mark Moore. . So I've now added these to my Amazon wish list ready for the next spare moment.

On a side note I belong to a reading group and we take it in turns to suggest a book from each of our 'pile of books to read'. We can't read anything which doesn't deplete someone's pile. So it makes for an eclectic selection as we plough through the birthday and Christmas gifts of each other's relatives.

In the various sessions I facilitated during the week four areas for discussion on changing the structure of local government came into play: better/different use of technology, the reduction in office space, the streamlining of processes (and retirement of redundant ones), and doing work in different ways – through mobile working, new business models, different service offerings etc. In practice these four dimensions inter-relate. Reducing office space, for example, means teaching people to mobile work, requires the technology that they can do so, and usually involves the 'leaning' of processes.

The notion of 'value' came into the discussions. How, for example, would participants in any one of the sessions be able to explain the 'value' to the taxpayer of their attendance? I had come across a blog by Seth Kahan a few weeks ago and in one of them he presented the notion of four types of value.

Latent Value
This is value that is latent, waiting to be found and exploited. It is like an underground reservoir, sitting there unnoticed, dormant, and ripe for discovery.
More Value
Here you increase the worth of current, established value. You achieve this one of three way

  • Decrease the required investment and provide the same benefit
  • Keep the investment the same and provide a greater return
  • A combination of 1 and 2.

Increases and decreases can happen either incrementally, in linear steps, or in multiples by scale.
Better Value
This uses existing benefits but increases impact, intensity, or application.
Impact is the consequence, effect or influence of a given benefit.
Intensity refers to the strength, power, or potency of a benefit.
Application means that the same benefits can now be transferred to a wider variety of uses.
New Value
When some new benefit that has not existed before is mid-wifed, you have new value. Many people will tell you this cannot be done. They are most often doing one of two things when they say this: (a) referring to the emotional state of the person you are satisfying, implying that our emotional states are known and finite, or (b) abstracting so much that the value they describe becomes relatively useless in application.

The discussion around types of value that they could bring to their individual roles and then onwards to the citizens seemed to appeal to people participating in the sessions as a concept worth exploring. Sadly, many of the participants seemed exhausted and demoralized by their situations. The will to do things differently was hedged by the various pessimisms. Wondering about this collective state of mind (this is a generalization) I was led then to an article by Yves Emery 'Identities of Public Sector Employees as a Source of Inspiration for Differentiating HRM practices' on the typologies of public sector employees.

He describes four 'distinct conceptions of motivation to take up employment in the public sector: Samaritans, communitarians, patriots, and humanitarians'. Reading the typologies I wondered if governments are unlikely to change because they attract people whose concepts of value are rooted in a different form of value from ones associated with 'doing more with less' on a financial construct. I wonder if there are any comparisons of public sector employee motivations with private sector employees motivations. Let me know if you come across any.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s