Measuring innovation in the public sector, but to what end?

On Monday I was at NESTA's international conference on Public Sector Innovation Measurement.

The day began with an international panel of speakers currently involved in research and policy development around innovation in the public sector. This was followed by a whole range of speakers from the UK and abroad, including researchers engaged in working on the Innovation Index for the public sector. NESTA is tasked with developing this index as outlined in the Innovation Nation White Paper, released one year ago.

NESTA's CEO, Jonathan Kestenbaum, opened the conference stressing the importance and need for measurement of innovation in the public sector because measurement shapes policy and the way public services are delivered.

The following panel speakers didn't hold back in outlining the broad challenges facing the UK public sector such as:

• Demographic changes
• Social trends eg. the aging population
• Climate change
• Economic downturn
• Budget cuts

And a key question, echoed not just among the panel but throughout the whole day, was the issue of how we all understand innovation and the lack of consensus around this (it was interesting to note that there was less emphasis on people saying "defining innovation").

Here are some of my own notes and reflections from the conference:

• Measurement shapes public service delivery and policy development. Measurement is therefore a critical aspect we must deal with
• Measurement that deals with innovation is multi-dimensional and complex
• There is a lot of hidden innovation, or innovation which is not visible and we must find ways to identify these
• There is currently little data on public sector innovation and even less on measurement of it
• There are many barriers in the public sector which impede innovation (eg. governance, incentives, organisational capability, understanding of innovation, process constraints, size and complexity of the public sector, bureaucracy, multiple stakeholders, reluctance to end programmes which are failing, few capabilities for organisational learning, lack of resources, lack of incentives, risk aversion)
• Understanding (not necessarily defining) innovation is needed so we can understand where and how it's happening
• The need to visualise measurement to get a "balanced picture" (panel speaker Svein Olav Nas from Norway mentioned this but unfortunately didn't expand much)
• Public and private sector innovation differs

The most interesting presentations (and one of the best, for it's clarity and being jargon-free) was by Head of Service Design in the Department of Health, Miles Ayling. Ayling gave us an overview of innovation in the NHS, why it has become a focal area, what issues the NHS faces and what is being done about overcoming these issues.

About 18 months ago, innovation in the NHS was made a top priority. The rising expectations of citizens for public healthcare services, policy drivers (such as those stemming from the Darzi Review) and the recognition that the NHS has a significant impact on the UK economy led the NHS to establish a programme to focus on innovation.

Ayling spoke first about the fact that the NHS were very inventive with new ideas, but were weak on piloting and scaling them, for example that there have been cases where ideas have even been sold back to the NHS. Some other issues which impede innovation in the NHS include:

• Leadership and vision of the NHS not having innovation "on their radar"
• Misalignment of reward and recognition
  
• Differing priorities
• Short-term approach and outlook
• A culture of competition rather than collaboration
• Funding streams directed toward areas such as R&D, rather than to spreading ideas
• Lack of access to information about what constitutes good practice in innovation
  

In response to these barriers a "legal duty" (or statutory responsibility) for innovation in the NHS was introduced.

In the Q&A session, one delegate asked Ayling to expand on what "legal duty" for innovation meant and Ayling's response illuminated a very interesting approach to how he and his colleagues see innovation in the NHS. Ayling declined to define innovation, and stated instead that innovation in the NHS was about- defining what organisational culture the NHS would want. The appeal of this perspective is that it allows flexibility for all the different parts of the NHS to reinvent themselves to do what is most appropriate to their own context.

And how would all this be measured in the NHS? Ayling didn't present indicators, but 4 key principles for metrics, these being:

• Looking at the macro and micro
• Looking at the short and long term
• Keeping metrics simple and
• Having 'powerful' rather than bureaucratic metrics

One final thing Ayling touched upon in his presentation was- who would all this involve in the NHS? He stated, everyone. This would require the need to look at all types of innovative outcomes such as:

• Incremental innovation (those coming from individuals in the organisation)
• Radical innovation (driving the market in a different direction) and
• Disruptive innovation (redesigning the delivery of services and creating new markets).

One key reflection I left off my earlier list was something a delegate brought up at the end of the day, which unfortunately got mis-interpreted and hence not adequately addressed. It had to do with- to what end was innovation and the measurement of innovation for? Why be innovative? What would 'being innovative' achieve? These questions were not really addressed by the panel or the speakers despite the fact they were all talking about, researching and developing policy around innovation in the public sector.

The conference continued on Tuesday, but day one painted enough of a picture for my own research in terms of understanding current research, development and policy for innovation in the public sector and ideas and thinking on how it can be measured. If you are interested to know more about the Innovation Index, keep checking the website here.