Innovation in public sector services

Abstract

Studies already acknowledge some distinctive features of public innovation, such as factors having an influence in innovation generation, factors enabling the innovation process and also barriers counteracting the innovation process. Public sector innovation is an issue increasingly demanding for attention. The present dissertation is aiming on the issue through an empiricalquantitative approach. What has been stated in theory has only in a few cases been properly compared to corresponding empirical data. The present study is one more step ahead in that direction. A main objective of this dissertation is to challenge conventional thinking about public sector being a barren ground for innovative activities. There is an emerging tradition of public innovation studies where it can be observed a tendency to contradict the view of a public sector where sustainable improvement processes are neglected. The conclusions that may be obtained after the applied empirical methods are meant to be part of it. Three particular objectives lead the research questions and analysis presented along dissertation: 1) making some propositions and giving empirical evidence on the main factors driving and enabling public innovation to its successful implementation, 2) identifying some features of the innovation dynamics that can be seen as specific of the public sector and 3) making an assessment of results of innovation implementation. Innovation in the public sector is the result of a complex process in which many factors play a role. Factors are of different kinds and they can be identified under different theoretical views on public innovation. Lack of the right incentives – market incentives in particular – has been thought for a while to be at the root of the public sector’s innovation gap. However, despite lack of market incentives, it is possible to find a set of factors that are useful to innovation development in public organizations. Chapter 1 is addressed to identify some factors driving and enabling public sector innovation and to assess their effects on the innovation performance of public sector organizations. The analysis is based on data at EU level provided by the Innobarometer 2010 Survey. Results of empirical analysis suggest that factors related to some degree of use of external sources of information, active involvement of managers and implicating staff and users in the innovation process have a positive effect on implementation of service innovations; furthermore, they have a particularly significant effect on the implementation of services that are new to the whole public sector. In turn, political and legislative factors seem to be useful for implementing service innovations but their effect on new service implementation could not be properly assessed. The use of external sources for innovation has an increasing role in organizations of all kinds; they can be essential for creating and developing innovation. With a particular theoretical approach, Chapter 2 provides with a framework to compare how significant it is for public service innovation the use of internal and external sources of information in innovation development. At the same time, statistical significance on innovation implementation from the use of both kinds of sources is assessed basing on evidence from the Innobarometer 2010 Survey. Results indicate a positive and significant relation between both the use of internal and external sources of information and the implementation of service innovations. They also give evidence to believe that using external sources of knowledge and information for innovation development is especially important for the implementation of services that are new to the whole public sector. High risk aversion is argued to be one of the main causes for the innovation gap between public organizations and private firms. At the same time, risk aversion is a consequence of public policy leaded by public accountability instead of market profit. Then, one could reasonably ask what is worth for public organizations to take the risks of innovation. For approaching to the answer, the followed method consists in estimating probabilities of positive and negative effects experienced after implementation of service innovations by public organizations represented in the Innobarometer 2010 Survey. Chapter 3 presents empirical evidence for helping to support assumptions about the potential of public innovations for achieving positive effects after implementation, and also about the risk of suffering some negative effects. Analysis is based on statistical significance of the effect of being an organization that has implemented service innovations on the probability of experiencing certain positive and negative effects from innovation implementation, this compared to the effect of being an organization that has implemented services that are new to the whole public sector. Results suggest there is only a slight significant impact from new service implementation on the probability of having positive effects. In turn, the impact of new service implementation on the probability of having negative effects is significant and of an important magnitude. Chapter 4 presents an alternative view for the analysis of public innovation implementation and its results. A big portion of public innovation studies are based in the observation of public organizations in developed countries. Therefore, are their findings equally valid in the context of developing countries’ public sector? This chapter has as a purpose to approach to the answer. For doing so, methodology consists in the analysis of initiatives participating in the Local Governing and Management Award, following a cases-study approach. Results from observations support the idea that poorly developed institutions often fail in improving from innovation, since innovations requires an appropriate institutional set-up. Nonetheless, an important and useful conclusion from this analysis is that innovation may be especially helpful for developing institutions and, later on, implementing higher leveled innovations. The central idea in this thesis dissertation suggests a view of public innovation under a multiagent framework, in such a way that public organizations keep a high degree of interaction with other organizations and individuals and also consider various ways for generating innovative processes, on top of those processes leaded under a rigid hierarchical structure. Results and conclusions obtained from empirical analysis in previous four chapters are helpful for supporting validity of the suggested view. The distinct ways for public innovation are reflected in the importance for new service implementation found in factors such as ideas and participation from staff, users and suppliers, and also in support from authorities and middlelevel managers. At the same time, results on the importance of using external sources of information towards implementing new services support an approach for public innovation which concedes a significant role to collaboration and participation from external agents, especially users and suppliers.