Unleashing public innovation S erial innovation and the public sector

1. Unleashing public innovation Serial innovation and the public sector William D Eggers Research Director, Public Sector Deloitte

2. How do we typically innovate? 1920 2011 Price in 2011 C$Log scale and inverted More forMore Ford Model T T $3,200 20 Horsepower Tata Nano $2,100 33 Horsepower Bugati Type 35 $180K 140 Horsepower Horsepower Low end High end Bugati Veyron $1.9 million 987 Horsepower

3. Higher education: 439% increase afterinflation

4. Health care inflation equally bad…. Other third party payers and programs Health insurance Out of pocket

5. Innovation is about breaking tradeoffs

6. Bridge International Academies $4 Fee per month of private education for 1 student $3 Cost in bribes for public education for 1 student 15:1 Pupil: teacher ratio at a Bridge school 47:1 Pupil: teacher ratio at average Kenyan school

7. Bridge International’s “school in a box” model makes it easy to open and operate new schools. What started with 1 school in 2009… Is now more than 70 schools… With a target of 1,800 schools by 2015

8. Key Factors for Public Innovation Authority Innovative activity that could create public value but is not permitted Potential innovations that can’t happen Public value created by innovation Innovation that should happen but won’t Capability Culture

9. Capabilities

11. GNL Senior Leaders - Innovation Workshop Testing &Selection Idea Generation Implementation Sustaining & Diffusion • Create systems to generate and maintain the flow of good ideas • Filter good ideas by creating an efficient sorting process Convert ideas into products, services and practices • Manage stakeholders and disseminate ideas widely The innovation process: One weak link in the chain can stump the flow of innovations

12. Measuring Innovation

13. There has typically been a wall between those on the inside of government and those on the outside Government …but that leaves a lot of minds untapped

14. Governments need to open up to everyone… Government …and engage the outside world in problem solving

15. Expanding the space for public innovation Authority Innovative activity that could create public value but is not permitted Potential innovations that can’t happen Public value created by innovation Innovation that should happen but won’t Capability Culture

16. NASA enlists the world’s help to advance the U.S. Space Program NASA will post its challenges online for a network of more than 180,000 self-enlisted solvers to tackle

18. Kaggle’s Dark Matter Competition on the White House blog “The world’s brightest physicists have been working for decades on solving one of the great unifying problems of our universe” “In less than a week, Martin O’Leary, a PhD student in glaciology, outperformedthe state-of-the-art algorithms”

19. Rules/authority

20. “Try again. Fail again. Fail better.” -Samuel Beckett

22. Chris Rock

23. Rapid prototyping, rapid engagement Gmail beta: 1 day

24. First version of Twitter: 2 weeks

25. Changing the rules • Hold a ‘failure case studies’ conference • Report to parliament on failures as well as successes • All annual reports include a section on failures and what was learnt • Put innovation into performance plans • Put failure into KPIs • Funding for failure • Have a system to share failures

26. OCTO Labs: Managing Risk the Right Away The idea was that we would throw hundreds of ideas on the wall and even if five of them survive, they will be transformative.” –Vivek Kundra Improving Policy Execution

27. Five Strategies for Innovation 1 2 3 Partner Cultivate Replicate 4 5 Open Source Network

28. Employees Citizens/customers Participative and responsive government Collaborative, outcome-focusedgovernment Tap all sources of innovation External Partners Partnered and networked government Government Innovator Internal Partners Joined-up and reinvented government The Public Innovator’s Playbook

29. Culture

30. EDGE  Growth Opportunities Edge Participants EDGE TYPES Demographic Edge Geographic Edge Technologic Edge FLOW  Connect Participants Knowledge Flow Cultivate – Innovation from the Edges The Core and Edge Concept EDGE CORE Edge Characteristics Unmet Needs Unexploited Capabilities Greater Risk Tolerance Lower Inertia Increased Collaboration Robust Connections

31. 20% Time The Public Innovator’s Playbook

32. Cultivate – Safe havens Safe havens are separate units kept close to mainstream activities but away from the line organization. Skunk Works Ensure that emerging ideas get the time to develop, protected from short-term budget constraints and premature criticism Permit low-risk experimentation Motivate “renegade” thinkers -- not people seeking to undermine authority, but independent visionaries looking to achieve results. Havens of creativity within an organization Intraprenuers Employees who act as entrepreneurs within an organization

33. “People are very open minded about new things. As long as they are exactly like the old ones” - Charles Kettering

35. Bill Eggers Email: weggers@deloitte.com Twitter: @wdeggers Web: williameggers.com