The public sector is under pressure to provide new public services with increasingly scarce resources. In response, there have been calls for greater innovation. An empirical analysis strongly supports a central role for innovation capability enabled by both ‘push’ and ‘pull’ sources.
The public sector is under severe pressure from new challenges, such as:
Innovation is central to the public sector's ability to deal with these challenges. It also has the potential to improve the effectiveness and also the problem‐solving capacities of public sector organisations.
However, the understanding of innovation in the public sector context is underdeveloped. A recent systematic review of public sector innovation studies concluded the literature lacks a clear theoretical underpinning.
Classic innovation theory draws a distinction between:
The relative importance of technology‐push vs. demand‐pull has been one of the central debates in the innovation literature. This debate has been fundamental to understanding sources of innovation for private sector organisations. However, the literature has largely overlooked public sector organisations.
The public sector is different from the private sector, with its lack of markets and need for democratic/public accountability. This can influence how push and pull factors should be conceptualised and how they influence innovation in a public sector context.
Also key is the concept of innovation capability which highlights the role of organisations capabilities in enabling both technology‐push and demand‐pull. This constitutes a key source of innovation in itself.
Public sector organisations need to innovate in order to create public value in more efficient or better ways. This may be particularly difficult for public sector organisations as they lack feedback mechanisms provided by market signals, such as declining sales and profits. As such public organisations are particularly dependent on organisational capabilities.
Using the lens of capability to examine public sector organisations and their effectiveness is useful because public organisations control a major part of the resources in society. These resources include land, buildings, infrastructure and budgets. Public organisations also have the capabilities to govern and administer these resources.
The creation of public value—or putting resources to their best use—is a fundamental task of public organisations. Capability is essential to creating this public value. While public sector organisations control resources, they vary in their capacity to deploy these in ways that create value for society. This implies these organisations differ in their innovation capability.
Leadership, experimentation and empowering employees have been found to be critical to innovation capability.
The empirical study sought to answer the question:
It involved a survey of 2,157 public sector institutions in the 27 European Union member states as well as Norway and Switzerland.
The study revealed:
Intensity of innovation in public sector organizations: The role of push and pull factors - Tommy Høyvarde Clausen, Mehmet Akif Demircioglu and Gry A. Alsos, Public Administration, Public Administration 2019
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