Interact - Innovation in the public sector

Innovation in the public sector in the Nordic countries

On the idea behind the Interact project.

The public sector is often described as "bureaucratic" - in a negative sense, as a slow moving and rigid hierarchically organised system, as time-consuming, oversized and expensive. This may indeed be the case in some instances.

However, the basic assumption for this project is that public organisations are changing. Public organisations are learning organisations with their own share of entrepreneurs and with directives regarding the need for organisational change. Hence, innovation is ever-present in the public sector. Interact will study how such learning and innovation take place.

Many ministries, public agencies and public service institutions make use of technologies or services developed and delivered by private firms and organisations.

Public institutions also face technological challenges where the solutions cannot simply be bought off the shelf, and are thus involved in technological invention and development.

The introduction of New Public Management (NPM) has been a major current in organisational reforms in the public sector during the last 20 years. NPM's private sector styles of organisation have introduced a totally new mentality or rationale in the understanding of the role of the public sector. Privatization and outsourcing have also resulted in new relations with private sector firms and non-governmental organisations, and hence fundamentally changed the public welfare system.

Studies of change in the public sector have been conducted within various disciplines. In these studies, the main focus has been on efficiency, reorganisation and structural reform of ministries, state agencies and public services.

Recently, researchers have focused on the impact and future implications of NPM-inspired reorganisations and reforms, particularly with respect to the principles of the state and the gains in economic efficiency.

Within the NPM-inspired studies, change tends to be treated as a linear and uni-directional process framed at the top and proceed to implement top-down changes in the public sector. However, numerous studies of innovation in the private sector have found that this is a too limited view. Innovation process are rather open, dynamic and non-linear.

The Minnesota Innovation Research Program (Van de Ven et.al.1999) has for example developed a "road map" for how innovations typically unfold - the "innovation journey". They find that setbacks and mistakes occur frequently, and that criteria for success and failure often change throughout the process.

Innovation therefore involves uncertainty and risk for the organisation. Success depends on good communications with stakeholders to receive support and resources and of champions that are able to guide the development process through the difficulties.

Similar assumptions are also present in the Actor Network approach which suggests that the success depends on how the actor networks unfold during an innovation process.

It is impossible within the framework of a small Nordic project to cover innovation processes in the entire public sector. Interact will focus on the dynamics of the mixed arrangements of public and private actors and institutions within the health and social service sectors in the Nordic countries.

The health and social service sectors are essential in the public welfare systems, and there seems to be a strong demand for innovation and change in these sectors in all the Nordic countries.

Interact will explore concrete innovation processes in the public sector, and hence contribute to the welfare development by a better understanding in analyzing questions such as: who initiates innovation in the public sector, what are the ideas and what are the expectations and culture for innovative activity in the public and private health and social service organisations.

Interact has grown out of -- and will make active use of -- the EU Fifth Framework Programme project PUBLIN, on innovation in the public sector.

PUBLIN has been coordinated by NIFU STEP, which is also coordinator for Interact. PUBLIN will be finalized by the end of 2005.

The final reports will be published in 2006.

The Interactsite is published by NIFU STEP, Centre for Innovation Research, Norway. Editor: Per M. Koch,