This article was previously published in the Danish weekly Mandag Morgen.
Co-production of our welfare tasks, whereby we activate citizens’ own resources and the resources of those closest to them can provide us with a cheaper and better public sector. That is some claim. After all, where are the benefits going to come from?
Once, when I was a young hopeful management consultant, we were asked by the Ministry of Finance to “deconstruct” the benefits of outsourcing. In other words: If outsourcing of public sector tasks to private companies can mean an increase in efficiency by perhaps ten per cent, to which factors could this be attributed? Is it possible to find a range of examples in which there was an increase in efficiency and isolate the reasons from one another in a way that indicates which factors generated which savings?
This is not the kind of job you turn down when the order comes from by the Ministry of Finance, which is paying for the privilege.
Outsourcing fails managers
This resulted in an inspirational journey all the way to Jutland and to successful or less successful outsourcing experiments, year 2000-style. Sadly, the conclusions from the exercise that were published in a blandly-titled publication called “Efficiency through competition” were not so inspiring. The benefits were primarily down to good management and the reason why outsourcing meant good management was pretty banal. When implementing the outsourcing of a municipality’s care for the elderly, for example, it meant that you were able to get rid of bad managers and replace them with better ones. A more rigid way of saying it might be that outsourcing thus became a way of circumventing the development of good public sector management and of taking responsibility for getting rid of those who did not possess the right skills. We even noted in the publication (due to respect for the fact that there are skilled public sector managers out there) that “the efficiency of a well-managed public sector welfare task cannot be increased significantly based on competition”.
This leads me to the point for the day: The reason why we can achieve this in a wide range of welfare sectors in a way that is both better and cheaper, as I wrote here recently, is purely and simply down to the fact that they are not being managed well enough at the present time.
Users’ motivation generates energy
In a research project about public managers as designers of welfare, I have taken a look at the origins of some of the future models for welfare. And here it turns out that public managers experience two things when they engage in innovation that is based on design methods such as ethnographic research, user involvement, visualisation, experiments, etc.
First of all, managers acquire new insight into why their current efforts do not succeed well enough, and how they can develop an entirely new relationship with their users. This was for example the case for Christina Pawsø, who was head of Camillagaarden, a workshop for mentally handicapped adults in Odense that won Local Government Denmark’s Award for Innovation in 2010.
Working together with a design agency, Pawsø took initiatives to listen to the users and asked them to share their hopes, dreams and desires for stimulating and meaningful lives. Pawsø became aware that it was actually the users themselves who held the key to both increased productivity and increased job satisfaction.
“I became aware that we do not have to be ahead of our users, but rather behind them or at the most beside them.” says Pawsø.
This was reflected in the fact that if Camillagaarden’s users did not want to take part in theatrical activities, then there was no reason to start them up, even if you had already hired someone to help out with it. The organisation of tasks needed to be based on what users wanted to do and where they had the motivation and resources to contribute. This in itself meant that it was possible to complete a greater number of activities with fewer employees. The more general point here, however, is that you trigger an incredible amount of energy in an organisation when you find ways in which users can thrive and even take co-responsibility for the production of welfare, be they mentally-handicapped adults, patients or perhaps pupils.
30 per cent greater efficiency without outsourcing
Secondly, managers who employ design methods are able to shift focus away from their use of resources and daily activities towards the results or effects they create. At Camillagaarden, there was a shift on the part of the employees away from the notion that “this is what we think we should be working towards”, in favour of “actually, it’s you, the users, who have the best idea of what works for you”. As a result, the focal point of the relationship is no longer the services that the organisation has “on the shelf”. The focal point becomes the difference that managers and employees are able to contribute to creating for the users. It is a hugely powerful transformation tool.
Camillagaarden illustrates that skilled public managers are perfectly capable of figuring out how to switch to a different and better business model. The changes set in motion by Pawsø and her colleagues led to significantly increased well-being and job satisfaction for the mentally handicapped adults, while Camillagaarden was able to handle 30 per cent more users with the same number of employees.
Now, that is what you can call an increase in efficiency. With no outsourcing whatsoever.