1. Public Service Reform; Continuity and Change Prof Sue Richards Director of Strategic Capability, National School of government 5 November 2007 Centre for Public Services Organisations Royal Holloway College Egham

2. Agenda 1 Contending paradigms of change –Outcome-oriented –Output-driven 2 Patterns of change under new Labour 3 Emergent picture of new approach 4 What do the world’s best organisations tell us

3. Contending paradigms of public sector change - caveats Big picture / complexity and detail Institutional factors – pull to remain the same Design capability limited Political timescales Vested interests Whole system experience

4. Outcome-driven change Post-war welfare state – safety net high trust society, power shared between levels of government, autonomy for public service professionals, little performance measurement or management, grateful public, New welfare state created at speed

5. Output-driven change 1980s/90s – efficiency Individualistic, low-trust society, centrally-driven, targets and measurement, break autonomy of public service professionals Dis-empower other levels of government, Public as customer, Fractured and ‘siloed’ working generates ‘wicked problems’

6. What about New Labour? Post 1997 - mixed messages - value of fluidity Some outcome-focused initiatives, Some whole system initiatives Intentions to decentralise but did not happen Some centralised planning Post 2001 – delivery - centralise (in order to decentralise?) Emphasis on outputs Local government ‘earned autonomy’ Re-structure of NHS (Attempt to) centralise parts of CJS

7. Signature of the new PM ‘Why can’t we just buy outcomes?’ – 1997 Schooled in the Treasury – outcomes, incentives and markets, critical of civil service Economics-led Vision of equality and empowerment – public as citizens Strategic focus Not good at spin

8. Today’s emergent picture Widespread recognition of key strategic issues / outcomes Old silo structures adapted – eg Department for Children Schools and Families Public Service Agreements – collaborative capability being addressed Concern for innovation and not just ‘roll-out’ – DIUS Focus on architecture for change But still need to wait and see

9. Challenges of leading the system World ranking of UK government effectiveness – 14/200 Pockets of excellence – Pensions Service Picture of huge UK effort leading to sub- optimal results What can we learn from elsewhere about achieving outcomes - Cf Finland’s educational performance - CF Best manufacturers – Toyota

10. The world’s best organisations have ‘dynamic capability’ ‘Leading by direction’ becomes ‘leading by design’ Create new routines – visioning, benchmarking, measuring Change is everyone’s business Keep the change changing

11. Visioning Top leaders to set high level vision, but visioning socially distributed Connect to purpose and outcomes at every level Find common ground between stakeholders and achieve collaborative advantage Create space for innovation by leaving the ‘means’ more open.

12. Benchmarking Learning how to learn Finding the best available examples through better information networks and dedicated people Bring home and process the lessons Application

13. Measuring Measurement primarily driven by the people doing the job – to enable improvement of process Secondary purpose is for accountability Aid to judgement, not a substitute Cut back the performance measurement industry (Gershon)

14. Continuity or change? Its all very difficult - complexity Drag effect of institutional factors Ambition to achieve outcomes and not just outputs Widespread disillusion with output-focused approach How can we pull together the academic and practitioner perspectives to create something better?