I3U Commitment 27 “A – Public Sector Innovation Scoreboard B – Research Programme on Public Sector and Social Innovation“ Venue: Vienna, I3U Project Meeting & Technical Workshop, 14-15.09.2015 Prepared by: WERI-SGH

Commitment 27 "Starting in 2011, the Commission will support a substantial research programme on public sector and social innovation, looking at issues such as measurement and evaluation, financing and other barriers to scaling up and development. As an immediate step, it will pilot a European Public Sector Innovation Scoreboard as a basis for further work to benchmark public sector innovation. It will explore with Member States whether it is appropriate to bring together new learning experiences and networks for public sector leaders at European level."

Theoretical framework New institutional economics (Williamson, 2000) Governance - related to dissemination of know-how and good practice. This solution results in easier learning and helps to avoid failures in implementing public policies. Resource allocation - related to mobilizing and pooling of financial resources in order to support research on social innovation and public sector innovation. Embededness - related to a benchmarking tool, that can be used to challenge the member states to implement innovations in the public administration.

Commitment 27 map

Causal relationships reflecting the impact of Commitment 27 limited understanding of the importance of social and public sector innovation financing research on social and public innovation dissemination of know-how and good practice benchmarking better performance of institutions and organisations increased competitiveness H2: The use of good practice and benchmarking will result in a better performance of institutions and organisations H1: Financing research on social innovation and public sector innovation will facilitate the dissemination of know-how and good practice

H1: Financing research on social innovation and public sector innovation will facilitate the dissemination of know-how and good practice Concept of open innovation Innovation in the private sector is usually protected from copying by others. In the public sector diffusion of innovation across the public (and private) organisations may ensure a better use of public resources (Moore, 1995; Mulgan and Albury, 2003; Rolfstam et al., 2011). Concept of innovation systems Financing research on social innovation may result in creating knowledge that produces positive externalities - creating useful new products, processes, and ideas arising from novel and unanticipated combinations and facilitate replication of findings as well as rise the social value of knowledge by lowering the chance that it will reside with persons (or groups) who lack the resources and ability to exploit it (for instance: Foray, 1995).

H2: The use of good practice and benchmarking will result in a better performance of institutions and organisations Knowledge management theory Using innovation awards results in a higher rate of cooperation among public agencies (Borins, 2001) Benchmarking provides accessible knowledge base. It can also be used to improve accountability and mitigate risk by making informed decisions, supported by access to integrated, transparent information (West, 2005) Benchmarking motivates countries having poor results (Kouzmin, A., Loffler, E., Klages, H., Korac-Kakabadse,1999, N. Jeffrey J. Dorsch, Mahmoud M. Yasin, 1998).

Selection of indicators The main findings of the European Public Sector Innovation Scoreboard show that innovation in public administration has positive effects on: improved user access to information, improved user satisfaction, faster delivery of services for business and citizens, competitive and innovative performance of companies Relevant indicator: Mean rank of EU28(EU27) in international rankings related to good governance issues

Indicators Indicator Source Years Coverage Expenditure on research related to social innovation European Commission, DG Research 2010-2014 EU 28 Number of implemented public sector innovations OECD, European Commission www.oecd.org/governance/public-innovation 2014 Mean rank of EU28(EU27) in The Worldwide Governance Indicators (dimention Government Effectiveness The World Bank www.govindicators.org 2010-2013 Mean rank of EU28(EU27) in Doing Business www.doingbusiness.org Mean rank of EU28(EU27) in the Global Competitiveness Index (pillars 1, 2, 9, 12) World Economic Forum www.weforum.org

Conclusions Both the knowledge management theory and the concept of innovation systems may be used for explaining the interlinkages between the actions under commitment 27 and their expected results. The knowledge management theory explains the role of benchmarking. In the public sector, which in general is risk adverse, an example of an innovation that brings positive effects can encourage organisations to implement new solutions. The concept of innovation system explains the results of financing research on social innovation. Financing research leads to creating new knowledge which can be disseminated (financing from public sources increases the probability that the research results will be distributed). Sharing new knowledge and research results leads to creating new ideas useful for the society.

Next steps The further research should be focused on the impact of knowledge dissemination and benchmarking on the performance of institutions (public institutions and other organisations that supply some kind of public services). The relevance of proposed indicators and their possible use for assessing the impact of Commitment 27 must be analysed in detail. It shall be verified whether it is possible to use this set of indicators for a cross country analysis in order to identify the factors responsible for the improvement in the scores of the selected countries. A detailed qualitative analysis within case studies will shed light on innovation processes in public sector organisations and show how benchmarking (in this case the PSIS) can help governments implement innovations. Case studies will provide a descriptive analysis with contextual information which will complement the quantitative data. Case studies will also be used to verify the causal relationships between knowledge dissemination and/or benchmarking and the innovative performance of institutions.