LICENCE TO INNOVATE REVISITEDHow government can reward risk

24.5

WP

WORKING PAPERJUNE 2016 24.5

6  INSTITUTE FOR COMPETITIVENESS & PROSPERITY

EXECUTIVE SUMMARY

LICENCE TO INNOVATE REVISITED:HOW GOVERNMENT CAN REWARD RISK

In February 2016, the Institute for Competitiveness & Prosperity released its 24th Working Paper, Licence to innovate: How government can reward risk. This discussed why

government should innovate and how to do it.

LICENCE TO INNOVATE REVISITED: HOW GOVERNMENT CAN REWARD RISK 7

THE INSTITUTE received an overwhelming positive response to this work. People wanted to know how they could contribute to the conversation and hear more stories about government innovation. This Paper does just that.

This Paper revises and expands on Licence to innovate by incorporating perspectives from practitioners within and outside of government. These voices include:

Karim Bardeesy Deputy Principal Secretary, Office of the Premier

Peter MacLeod Co-founder and Principal, MASS LBP

Sandford Borins Professor, University of Toronto

Greg Orencsak Deputy Minister, Treasury Board Secretariat

Jonathan Craft Assistant Professor, University of Toronto

Karen Pitre Special Advisor to the Premier on Community Hubs, Cabinet Office

Kevin French Associate Deputy Minister, Ministry of Government and Consumer Services

Jay Porter Director, Cabinet Office

Karl Frost Manager, Cabinet Office

Donna Ratchford Director of the Policy Innovation Platform, Ryerson University

Josh Hjartarson Vice President Public Sector, KPMG

Sean Twyford Director, Ministry of Children and Youth Services

Julian House Behavioural Scientist, Treasury Board Secretariat

Blaine Woodcock Public Strategy and Innovation, Deloitte

Lauren Hunter Head of IN.spire Innovation Hub, Natural Resources Canada

Judith Wright Consultant to the Ministry of Children and Youth Services on the Collective Impact for Disconnected Youth

Sheldon Levy Deputy Minister, Ministry of Advanced Education and Skills Development

This project was part of a new process for the Institute, and we are grateful to those who shared their insights. In the spirit of innovation, we realize our work can be modified and are open to further discussion. Change is not possible without you. We look forward to continuing the conversation.

8  INSTITUTE FOR COMPETITIVENESS & PROSPERITY

GOVERNMENT INNOVATION IS IMPROVING DESIGN, PROCESSES, AND IMPLEMENTATION OF PUBLIC SERVICES TO ACHIEVE A STATED GOAL.

THIS MUST BE ROOTED IN A CULTURE OF COLLABORATION, A FOCUS ON END USERS, AND EXECUTIVE LEADERSHIP

THERE ARE THREE BARRIERS ASSOCIATED WITH GOVERNMENT INNOVATION…

...AND FIVE BENEFITS

Design

Focuson users

Culture of collaboration

Governmentinnovation

ImplementationProcess

Executiveleadership

Organizationalrealities

Culturalpractices

EFFICIENT USE OF RESOURCES

EFFECTIVE POLICY

GOVERNMENT LEGITIMACY

CIVICENGAGEMENT

HUMAN RESOURCE MANAGEMENT

PERMISSIONGRANTED

Accountabilityframework

GOVERNMENT INNOVATION IS IMPROVING DESIGN, PROCESSES, AND IMPLEMENTATION OF PUBLIC SERVICES TO ACHIEVE A STATED GOAL.

THIS MUST BE ROOTED IN A CULTURE OF COLLABORATION, A FOCUS ON END USERS, AND EXECUTIVE LEADERSHIP

THERE ARE THREE BARRIERS ASSOCIATED WITH GOVERNMENT INNOVATION…

...AND FIVE BENEFITS

Design

Focuson users

Culture of collaboration

Governmentinnovation

ImplementationProcess

Executiveleadership

Organizationalrealities

Culturalpractices

EFFICIENT USE OF RESOURCES

EFFECTIVE POLICY

GOVERNMENT LEGITIMACY

CIVICENGAGEMENT

HUMAN RESOURCE MANAGEMENT

PERMISSIONGRANTED

Accountabilityframework

LICENCE TO INNOVATE REVISITED: HOW GOVERNMENT CAN REWARD RISK 9

DESIGN IMPLEMENTATION

PROCESS

Ontario's Licence

Plate StickerRenewal

Institutefor Public

Administration of Canada

Awards

PennMedicine'sInnovation

Tournament

Ontario’sOpen

GovernmentInitiative

Toronto'sParticipatory

Budget

Adobe’sKickboxInitiative

Ontario'sCommunity

Hubs

Ontario’sEnvironmental

Registry

UnitedKingdom's

EmploymentZones

US’sSmall

BusinessAdministration

BC’sEmployment

Program

Ontario's ServiceOntario

Centres

Ontario'sLocal Poverty

ReductionFund

Ontario'sInnovation

ProcurementInitiative

BUT WE NEED TO OVERCOMETHE COSTS

DID YOU KNOWABOUT THESE EXAMPLES OF GOVERNMENTINNOVATION?

WE PROPOSE THIS ACCOUNTABILITYFRAMEWORK

Ontario's Gift of Life

ConsentForm

Canada’sCarrot

RewardsProgram

UnitedKingdom’s

CommunityBudgets

Brookfield’sPolicyHacks

1

Comprehend, articulate, and reflect on an issue.

Context investigation

Tally the financial and human resources involved in innovation.

Inputitemization

Determine the outputs of innovation, or what was produced.

Outputidentification

Review the overarching results of innovation.

Outcomeinspection

2 3 4

REWARD DEVELOP ALLOCATE

10  INSTITUTE FOR COMPETITIVENESS & PROSPERITY

Integrate innovation into government activity to counter the risk-averse culture Ontario should expand the Program Review, Renewal, and Transformation process to include innovation. Establishing innovation hubs and labs within government’s central organizations presents other opportunities. Further, Ontario should build innovation into ministerial mandate letters, integrate innovation into organizational objectives, and embed innovation into core processes. This requires a whole-of-government approach.

Revise funding frameworks to boost design Ontario should allocate resources across missions (not by ministries), aligning ministerial funding cycles along the way. In addition, government should centralize innovation funds. Central agencies, namely Cabinet Office, the Ministry of Finance, and Treasury Board Secretariat should champion this work.

Apply behavioural insights to improve designOntario should expand the number and scope of policy experiments conducted by its Behavioural Insights Unit. Celebrating this work internally (through Topical) and externally (through News Releases and social media) is also a must. This is a role for Ontario’s Policy Innovation & Leadership group.

Advance human resource management to strengthen processesOntario should strengthen human resource management through gamification and employee awards. Hosting an OPS-wide innovation tournament, awarding winners with job opportunities is one idea. Partnering with organizations to celebrate innovators is another. Further, Ontario should attribute and recognize public servants’ work within and outside the office. Treasury Board Secretariat, who is centralizing human resources, should play a leadership role.

HOW TO ENHANCE GOVERNMENT INNOVATION

LICENCE TO INNOVATE REVISITED: HOW GOVERNMENT CAN REWARD RISK 11

Modify the quality and scope of engagement to support processes Ontario should develop the institutional frameworks and leadership talent to engage the public. This can be done by mandating the public release of hackathons and mind labs. Broadening job responsibilities of bureaucrats working in communications departments, along with evaluating efforts to engage the public, are also required. Lastly, the Institute encourages Ontario to undertake its own participatory budget projects, especially in publicly funded organizations. Ontario’s Treasury Board Secretariat and Ministry of Finance should play leadership roles.

Revitalize relations between government and delivery agencies to upgrade implementationOntario should view itself as a commissioner of services. Part of this involves incorporating innovation into government-wide procurement; this is work for Ontario’s Ministry of Government and Consumer services. Government must further adopt a payment-by-outcomes framework and organize delivery agencies’ work across community hubs. Partnerships between Ontario’s Treasury Board Secretariat and the Community Hub Secretariat are worth exploring.

Streamline services to refine implementationOntario should convene province-wide community planning to build on the work of community hubs. In addition, the province should proceed with the Collective Impact for Disconnected Youth, communicating successes and failures. This should be a government-wide effort, led by Cabinet Office.

Monitor government innovation to enhance accountabilityOntario should account for innovation by tasking an external third party body to monitor government activity. The Institute is ready to report on government activity and third party bodies of the Legislature should do the same. On the political front, elected officials should engage in open and honest dialogue. Allocating Standing Committee meetings or creating an external review board to account for government innovation is a start. Changing the tone of Question Period is a must.