08 Dec 2023
by Robert Beard

The pillars of public sector innovation: create the internal conditions and partner with the broader ecosystem

With enduring challenges and pressure on resources, better harnessing of innovation can be a catalyst for improved outcomes in the criminal justice system. In theory, innovation—the act of doing differently to achieve better outcomes—is simple. In practical delivery terms, particularly for public sector organisations, it can be poorly executed.

Whilst building innovation capability with government departments and health organisations, we’ve learned that public sector innovation rests upon two core pillars: i) creating the right internal conditions for innovation to thrive and putting frontline staff and service users at the core; ii) participation in a genuine innovation ecosystem to accelerate the path from identification to adoption and ultimately, impact. This article highlights some of the lessons we’ve learnt helping public sector organisations build these pillars.

1. How to create the right internal conditions for innovation

Successful innovation requires both top-down and bottom-up effort. Organisations must create the conditions which empower front-line workers and improve the lives of service users, but also support them with the infrastructure and central capability to unlock the potential organisation-wide benefits. This requires investment in common building blocks:

  • Leverage the power of front-line staff and service users. Innovation is not only about shiny laboratories in capital cities; for the public sector, it is rooted in frontline staff and suppliers finding practical solutions to do more or better, then supporting them to implement them. Leaning on staff and service users’ experience to deliver increasingly personalised and inclusive approaches can deliver improved outcomes. Suppliers and staff should be empowered to discuss, define and test ideas with other functions through a structured innovation process, ensuring adoption decisions have benefited from robust piloting and benefits tracking.
  • Establish robust internal mechanisms to adopt the best ideas. Maximising the impact of ideas conceived at front line needs organisations to invest time and resources in designing and embedding channels for ideas, and a structured and repeatable approach which enables them to sift, champion and scale new ideas, guided by clarity on what value means for the service. It must then be practiced. We’ve found that it is those who invest in the right capability, and integrate it seamlessly, who have most success delivering benefits.
  • Embrace failing fast to deliver an innovation culture. Our work tells us that 60% of public sector innovations fail. The quicker failure is identified, the more time, cost and capacity is saved. ‘Failing fast’ can be a distraction for front line staff where their focus is on prioritising user welfare with scarce resources, but it is crucial to new / better service delivery over the long term. Leadership must commit to both creating an innovation culture, but also supporting recovery when innovations fail.
  • Connect with the broader public sector to share learning. In our experience, burgeoning innovation communities face similar challenges. The most successful innovation functions lean into the success of others (such as GDS or NHS England) and reach over institutional boundaries so that lessons are learned and knowledge is shared, enabling the public sector to act as greater than the sum of its parts.

2. How to look outwards to accelerate innovation conception to impact

The second pillar requires organisations to look outward, working in partnership with a broader innovation ecosystem through an innovation’s lifecycle to maximise and accelerate the potential of innovation conceived at the front-line.

  • Identify, validate and evaluate potential innovations with the broader ecosystem. Once potential innovations have been identified at the front-line, organisations should use their innovation ecosystem—the market, academia and think tanks—to bolster and test them, enabling public sector organisations to access insight from adjacent sources during horizon scanning. Organisations that look outwards earlier accelerate use case development, feasibility testing and evidence evaluation, shortening the time between idea and impact.
  • Understand market capability, capacity and appetite to partner. Market capability may be required to pilot and/or scale ideas. Government commercial teams need to lead from the front with more open market engagement, aligned to the services being delivered. This will drive innovation by drawing on the breadth of the market, including alternative solutions. Commercial can test their capability and appetite, and widen participation by providing insight into and reducing potential barriers for smaller providers and the third sector, whose values often better align with the core mission of the service.

  • Choose how to pilot and scale innovations. Informed by the market engagement strategy, build, buy, or partner decision-making should be incorporated as a core part of the innovation lifecycle, including capacity to retain and share lessons learned to drive continuous improvement. When going to market, the risk appetite of commercial functions and the broader business must be aligned to ensure delivery of outcomes.

  • Explore opportunities presented by alternative delivery models. Buy or build is no longer a binary choice; it is a spectrum, with an array of options that can allow public sector organisations to pilot and scale innovation. These have individual characteristics that can benefit government, such as enabling public sector organisations to go to market together, or work with the third sector in different ways.

Innovation is not an insular capability; organisations must draw on the insight of their innovation ecosystem. To do this, we’ve learned that commercial functions must play a strategic role across the entire innovation lifecycle. Aligning all functions around a single ‘innovation north star’ can foster collaboration and drive change, so organisations should prioritise definition of a vision and strategy for each service, then clearly define and socialise what value means for the service with the organisation and market. We’d welcome the opportunity to discuss these lessons with departments in further detail.


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Robert Beard

Robert Beard

Central Government Strategic Advisory, KPMG LLP