A Tale of Two Weekends

For each of the last two weekends I have been with folk who were giving up their weekends for a purpose.  

One was in Birmingham: localgovcamp, an unconference of (generally) younger UK local government folk, enthusiastic for internet-era change.  

The other was in Lausanne: a gathering of Alumni of the Institute for Management Development there –  significantly older, continental European (only two Brits), entirely private sector in tone and with senior (SOLACE-equivalent) people grappling for an understanding of internet-era tech.

I got very different things from each of them, as you might expect, and they each and together made me think, so I had to write this to find out what I thought about it all.

The Clarity that Comes from Competition

One thing that struck me was the comparative clarity of focus of the IMD event.  The theme of the IMD event was transformative technology – we discussed AI, blockchain, digital, agile etc.  The word of the conference was “disruption” and it became increasingly clear that the unifying underlying driver was competition.  If you are in a competitive market

new technological possibility + competition = disruption

Competition was such a driving force for these folk, and many of the sessions offered frameworks for thinking about competition.  Competition was what got a group of quite senior people to engage their brains in some detail with the strategic opportunities and threats of what might very broadly be called the digital agenda.  400 of them, openly admitting that this was all new to them.

If the IMD event was brought to us by the words “competitor” and and “disruption”, the key concepts for localgovcamp, by contrast, were “users” and“making change happen”.

Local Government doesn’t do competition (or does it?… see later).  So for our sector 

new technological possibility = new technological possibility!

On which basis one might wonder why the great and good of local government aren’t swarming all over the possibility of internet-era tools and tech to reduce costs and improve customer service.  Why isn’t it a no-brainer?

I gave some thought to that in a talk that I did at the more conventionally conference-like session on Friday at LocalGovCamp.  

All Decisions are Rational

All Council decisions are rational  (I argued) – if a decision seems irrational it’s simply that one doesn’t understand the worldview of the decision maker.  What then is the worldview in which we’re not leaping at this technology the way the private sector does?

And I think that part of the story is that “digital” is just one of a number of big broad strategic levers that councils can now pull, and the other part of the story is that many of these levers are actually really “new” – and did not exist when a significant fraction of local government decision makers were learning their craft.  This got me thinking back.

Thinking Back 15 Years

I was musing (for my talk) on life in 2003 – I was deputy CE of a council then, and many of the people who were my contemporaries are now holding very senior posts in the sector.  The local government skills I was learning, and the context I was learning them in, were:

  • top-down driven e-Government and a completist nationally-imposed KPI – the (infamous) BVPI 157 requiring 100% of council services to be delivered electronically (with some fudging around “100%”, “services” and ‘electronically” as I recall!)
  • top down requirements of councils – the Comprehensive Performance Assessment, the notion of the “ideal council” as a standardised template, and significant intervention from above in the event of non-compliance 
  • the relatively new introduction of cabinet and scrutiny and a new nationally imposed statutory role of Director of Children’s Services
  • quite a lot of data around, but in the form of nationally reported statistics rather than as a tool for decision-making 
  • until the wellbeing power came in a couple of years earlier councils were only able to do things for which they had specific permission in law, and even the wellbeing power (which was an attempt to loosen that constraint) didn’t really give councils the freedom to differ – it took the general power of competence in 2011 – still 8 years away from the perspective of 2003 – to do that
  • although we needed to make cost savings (who remembers Gershon Efficiencies?) there was generally more money in the system, and there were some very substantial parts of the big state around eg in the form of the RDAs.

 

If you think that the major drumbeat of a council is the annual planning cycle, that world was only 15 “beats” ago.  And of course the huge impact of austerity has come in in that time, which in every case I can think of, has ended up with the councils having reduced strategic capacity.

Lots of New (and Difficult) Choices

From the perspective of a senior leader today there are a number of strategic levers for change available now which simply didn’t exist back then.  It’s worth listing them out, I think:

1. “Digital” in the sense of:

    • user-centred design as a mechanism to radically shake up services
    • new ways of working (eg Agile) to get there, and new collaboration tools (eg Slack, Trello) to lubricate the process
    • new technology (sometimes) to implement the outcome.

This the one that the LocalGov Digital crew are rightly focused on as being a lever for change – it’s a very exciting one and it’s one where I’m putting quite a bit of my interest and effort (and learning) right now.   But there are others, many of them unlocked by the general power of competence and the localism act, as well as by internet-era tech:

2. Commercialism.  Councils can make money , leveraging their assets, whether those are tangible such as land and property or intangible such as knowledge and services.  Star examples here being the likes of Norfolk CC, Runnymede DC and Oswestry Town Council.

3. Civic Entrepreneurialism. There is scope to encourage civic entrepreneurialism in the staff and in the place, with empowered “public managers” able innovatively to identify social problems or opportunities and creatively to mobilise a range of public private and community resources accordingly.  I think here of the Leeds City Council work, some of which I saw as a member of the Service Transformation Challenge Panel in 2014, and another great example is Frome Town Council.

4. Analytics. the tools of, and insights from, modern use of data are still hugely untapped by local authorities – I have written about this elsewhere – it’s the game changer that we have done least with, as a sector and is also closely related to demand management and behavioural insight. 

5.  Public Engagement and Participation.  The opportunities of active citizenship promulgated eg by mySociety, the new tools of democratic participation and citizen engagement exemplified by the Democratic Society – these are also new levers which strategic leaders may decide to pull to advance their organisation.  There’s the Kirklees Democracy Commission, and I’m not close enough to it but I think that Wigan’s “The Deal” falls into this category.

6. Economic Growth.  Some councils are getting much more actively engaged in economic growth in their communities as the RDA machinery and money has fallen away.  And there have been financial incentives eg New Homes Bonus for some, for this.  My sense is that far more CEs are now at MIPIM promoting their area, and I have in my possession the business card of a Chief Executive from the North East which has a Chinese version on the back, such is the relationship of that place with Chinese investment and manufacturing.

7. Access to funds.  Prudential borrowing and municipal bonds – arguably neither used as much as they could be, but available for investment in the future for those who wish to partake.  Social Impact Bonds and similar investments are also available but it is hard to switch from the “bidding for grants” mentality which was common “when I was a lad”.

8.  Local Collaboration.  With the top-down vision of Total Place a distant memory but the “guilty knowledge” of the waste from ill-coordination which that showed, a number of places have made the most of opportunities – externally provided such as HWBs and STPs or self-generated – to establish new forms of collaboration with other parts of the public sector.  I think here of the work and ethos of Collaborate CIC, or the work that LB Islington did with the DWP to improve ways into work.  I think of Melton BC’s fantastic approach to co-location and of course I think of the star performers in many ways, AGMA giving rise to the most rounded devolution deal to date in Greater Manchester.  And that introduces the next big lever.

9.  Localism.  Whether as a formal devo deal or as a way of engaging locally, spinning out or devolving services to community providers or to other tiers of local government, this is a BBL (bloody big lever).  A really important tier of local government in this respect of course being the towns and parishes – many of whom are hungrily grasping services that they know that can manage better for their place than the councils above – just as local government seeks to do from central government.  Examples abound here such as Frome and Salisbury Town councils, and it’s great to see the good work done by the unitary councils of Milton Keynes and Bradford who could teach Whitehall a thing or two- willingly engaging with empowering and equipping the first-tier of local government.  Neighbourhood plans (there’s that 2011 Localism Act again) are giving new life and purpose to community organisation, and we are seeing a stream of new parish councils being created as a ideal (purpose built!) mechanisms for democratically accountable, publicly funded community activity.

10.  Austerity. Austerity itself has been a lever for change – I’m old enough to remember all of the brave LG presentations around 2008 quoting Rahm Emmanuel’s “never waste a good crisis”.  In the early days a considerable amount of latitude existed to “refresh” personnel, think the previously unthinkable (but actually desirable) and for example to close down little-used services.  Many councils used this to good effect.  It is still a mechanism for holding toes to the fire in terms of cost control etc.  Understand please I am not advocating austerity as a strategic lever but it can been used as that.

11.  Squeezing the toothpaste left in the tube.  There is still often a bit of scope for getting more out of turn-of-the century solutions.  Bloated e-Gov era software often has unused functionality that can generate improvement.  Improvement in leadership throughout the organisation and the dissemination of a compelling narrative raises morale, energises effort and innovation, and cuts waste even in places making little or no use of any of the newer methods above.  We haven’t done all we can with classical 20th century methods such as lean and business process re-engineering (where applicable) and recent experience has shown there is also scope for savings and service improvement from local restructuring such as mergers or unitarisation.

12.  Externalisation.  Classic turn-of-the century outsourcing (and some shared services which echoed the form) have acquired a bad name, as some of the fundamental underlying assumptions have been remorselessly annihilated – for example that circumstances will stay broadly the same for ten years!  New public-sector delivery models have attracted more bad press (eg Northants) than good (multiple unsung successes) but successes there have been and internet-era externalisation options are emerging – e.g. business processes as commodity services, delivered remotely.

That’s quite a lot of options, yes?  I may have missed some things or classified some differently than you would have, but it’s still a lot.  Picking the right combination of these for any given place (because each place will be different) is really hard, and I repeat again that these are all “new” at least in the last generation or two of senior management – and many experienced councillors.

Acquiring the personal knowledge (or building the right team, or advisers) across a sweep that big is enormous challenging and if some senior teams have chosen to focus on some of these not others that’s rational – however contrary it may seem if you’re a fan of one of the deprioritised options.  Top executive training for future leaders has to make tough choices across these strands and the next generation will have to find their own training and inspiration for those items not on the curriculum.  I’m particularly frustrated that Analytics still struggles for attention. (It is big and it is clever).

It’s really exciting having all of these new possibilities – chatting at the weekend with the executives from various European businesses and earwigging some of their conversations – what they are doing is so dull and meaningless by comparison.

It’s just a little frustrating to still hear the refrain from leading chief executives to their colleagues (and it’s rarely the ones who are in the room who need telling) that “we don’t have to wait for permission” or “they’re not going to tell us what to do”.  But I’m personally really enjoying working with the ones who are up for it.

Polaroid (an interlude)

I‘m very interested in how ideas from one place can be applied in another, and at IMD there was a cracking case study of Polaroid, who famously “failed” to get on board with digital cameras and went bust.   In fact, as early as 1987 Polaroid were demonstrating digital cameras and internet connection to colour laser printers for a high tech version of the instant print.   Why then did they fail to capitalise?  It turns out the answer is that although the “user experience” was pretty similar (take a picture, get a picture) the business models were fundamentally different in a way which stopped the company moving from A to B even though they had the tech to do it.  

What happened was this: Polaroid’s previous business model was to sell the cameras at cost and make their money from the film cartridges.  They’d sell the cameras cheaply at low-end retail outlets like Walmart, Woolworth’s and so on.  

The market for digital cameras was very different – for a start you had to make the money on the cameras, and secondly given the costs it was an upmarket sell aimed at specialist retailers.  So this meant they had to go to the account managers for Walmart and say that they weren’t going to sell their new products there, and that they were no longer their future channel of choice and… this did not go down well.  Organisationally it proved impossible to flip the model for structural reasons that had nothing to do with technology.  Points A and B were clear but there was an unclimbable wall between them.

If you currently work in Local Government your face is probably looking a little bit like mine did when I heard that story.  We could be stuck with a clear idea of A and B, but the wrong side of a wall that will take a very different kind of solution to displace us from.  Maybe it’s all or most of the levers above! 

Competing for Relevance

And that’s where it occurred to me that we cannot really apply models of firm competition at the level of individual councils (unless for their own commercial activity, or competition between places for economic growth, but that’s another story).  Instead we have to apply the notions of competition at a sector level.  What has to happen for us to continue to be able to serve peoples’ needs, before some other “competitor” comes and takes it away.

As a sector we are essentially competing for relevance.  That competition is to understand and follow up on the actionable needs of people.  This applies to sub-sectors too, perhaps especially Counties.  

I was reminded in Lausanne that competition (genuine competition not the fake regulatory kind which pretends monopolies aren’t) is an exceptionally powerful motivator.  

I’ll be doing more thinking about this, because I want to start applying some of the notions of competition-led disruption to see what light that should cast on sector-wide change, and what that means for collaboration with other sectors.  

 

In the meantime, I’ll be interested in any thoughts on this and especially pointers to anyone who said more of it, or better!

 

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