The evolution of service delivery - Canadian Government Executive
Service delivery
March 24, 2015

The evolution of service delivery

New service delivery models have dramatically increased citizen expectations about the quality and delivery of public services, emphasizing lower costs, higher quality, and customization. The incongruence between citizens’ expectations of outcomes and governments’ cultural focus on process exacerbates the growing divide between citizens and their governments.

Nowhere is this divide more apparent than at the municipal level where the introduction of Über is upending established municipal taxi systems. Government responses vary widely. On one end of the spectrum the city of Boston signed a data sharing agreement with Über; on the other, a number of Canadian cities have outright banned the company or are attempting to do so. These are early days and the end result of these approaches is unknown, but Boston’s strategy could allow the city to lever new sources of data to improve its transportation system, whereas bans may even raise the specter of regulatory capture.

While controversy abounds concerning the introduction of disruptive service delivery models into established and regulated markets, the underlying point is that governments are faced with a complex choice architecture. The arrival of Über represents a perfect example of the challenges new digitally enabled service delivery models pose to governments.

At the recent Digital Governance Forum, panelist, political author and columnist Susan Delacourt framed the issue as one whereby the rush to give citizens what they want might not always give them what they need, ostensibly arguing that careful consideration must be given to what actions governments should take to maximize the public good, support productivity and create economic opportunities for their citizenries. However, given the rapid and in some cases visceral responses to Über, careful consideration has likely been the exception rather than the rule.

While these pressures may be most acute – or at least most visible – at the municipal level, other levels of government are not immune. Provincial and federal policymakers, regulators, and service providers are also working to make sense of how new service delivery models are impacting their core business today and are likely to do so over the medium- to long-term.

At the Forum, Amanda Clarke, assistant professor at Carleton University’s School of Public Policy and Administration, discussed two options for responding to the increasing speed of service delivery innovation and disruption as well as the problems that arise from each option. According to Clarke, governments could either outsource services to private providers who are better positioned to keep pace with the speed of private sector innovation or they could pursue a strategy of internal capacity building whereby they develop elite digital service designers within their organization.

However, neither strategy is without risk. The danger of the former is that it can leave public service organizations isolated and out of touch with the public they are meant to serve, while the latter risks yielding corporate-style governing institutions disconnected from the traditional public service values that underpin them.

Furthermore, as the British experience suggests, the final form of either approach is unclear, as highly capable internal teams have been increasingly spun out as separate entities under a variety of governance models. For example, the rapid growth of public sector mutuals in the U.K. is being widely heralded as a success but time will ultimately tell how effective the strategy has been.

In Canada, a similar strategy could be pursued under the guise of social impact investing and the commissioning of social impact bonds (SIBs) by governments. However, despite robust discussion at multiple levels of government and a stated willingness to experiment from would-be service providers, activities haven’t scaled to nearly the same levels as mutuals have in the U.K. These models are not analogous but they are in some ways congruent.

One key point of overlap – and an often ignored issue in the Canadian conversation – is the fact that even when a government outsources the provision of services through new financial instruments to private providers, ultimately, it is still the government that must shoulder the risks and backstop failures along the way. In other words, transferring fiduciary risk doesn’t necessarily transfer reputation risk. This risk is omnipresent, owned by governments and deeply tied to their role as public stewards.

Unsurprisingly, the issue of how to deal with emerging service delivery models is not one that is easily settled.

That said, one of the keys for governments moving forward may in fact be the flexibility to adopt different approaches and adapt to different contexts while maintaining a view to outcomes rather than process; which may be easier said than done within a government context.

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