Open innovation in the Public Sector: The Argentinean case
Relevance of open innovation for the public sector
“No matter who you are, most of the smartest people work for someone else” (Lakhani and Panetta, 2006).
While governments have to deal with many of the most pressing issues of our era, their organizations are often not prepared to nurture innovation and implement disruptive solutions. To make things worse, most governments are not able to pay competitive salaries (i.e.: the CIO of the $54bi National Pension Fund of Argentina receives a before tax salary of ~$42.000 per year) and career advancement is impeded by “political cycles” (i.e.: every four to six years a new president is elected, forcing most of the officers to leave).
Also, open innovation processes help organizations reach people and resources beyond their usual area of influence and align their own decision makers. This is especially true in governments, which are intrinsically heterogeneous and are concentrated in a small part of their areas of influence (i.e.: capital cities).
That is why open innovation is critical to overcome the limitations of the public administration when it comes to improve processes and develop new policies.
How Argentina is dealing with this opportunity
In a context of severe constrains, the new national authorities are working hard to help Argentina converge and close the technological gap that the country suffers after more than 12 years of protectionism.
In this spirit, President Macri formed the Ministry of Modernization under the leadership of Minister Ibarra.
Minister Ibarra created the Office of the Undersecretary of Public Innovation and Open Government to foster cross collaboration and nurture open innovation as a source and a resource for policy makers.
This office is in charge of four main policies:
- gob.ar: it is a “laboratory to design public policies” that helps the governments of the provinces and the national ministries organize open innovation processes such as challenges and contests. It also helps the selected teams to pursue their ideas by providing resources and networking across the whole country and the region.
- Public Policy Design Academy: it is an institute that seeks to develop entrepreneurial and innovative public servants and prepare them to interact with the broader population through trainings, “innovation marathons”, research, executive programs and the participation of experts and leaders in several subject matters.
- Open Government Partnership: it is the interface of the government with civil society organizations to foster transparency and public-private collaboration.
- Open Data: they generate datasets and analytical tools for the scientific community and the broader society. Entrepreneurs greatly benefit from open data and many companies use this information to develop their products (for instance, transportation start-ups use data on public transportation to develop their models).
In the short term, they are working on “quick wins” on those four areas. For instance, Lab.gob.ar is organizing “INNOVA”, open innovation challenges to solve problems that the governments face. They are constantly reforming the format and dynamics of those events based on their learnings (for instance, at the very beginning they organized hackathons but now they organize longer processes where the participants offer deeper solutions to the problems at hand).
In the long term, they are working on the “Argentina 2030” plan. However, most of what they do has a rather short-term focus. The main underlying reason is that the “planning horizon” is four years (i.e.: the presidential term) so officers place a premium on short-term impact. Even though this might be sub-optimal, the reality is that usually presidential successions many initiatives and policies end up being terminated.
Open innovation is a priority for the national government and it is making bold progress. However, there is still a long way to go. For instance, the Innova challenges do not receive support from private companies, they take a long bureaucratic process (~6 months to be approved) and they have problems recruiting relevant external subject matter experts to collaborate. Also, budget and human resources constraint the number of initiatives that are pursued by the Ministry.
The short political cycle also impedes longer-term initiatives (such as developing longer-term relationships with other stakeholders like universities and NGOs)
To address those issues, I think that the ministry could develop many more relationships with key stakeholders in the private and the non-for-profit sectors. For instance, NGOs such as EMPREAR have deep expertise when organizing open innovation processes. They have organized many hackathons in partnership with municipal governments of the Buenos Aires area, attracting the sponsorship of leading companies such as Microsoft.
Looking forward, I wonder how they might nurture meaningful relationships with other stakeholders to overcome their limitations. Also, it would be interesting to know more about what incentive structures could be put in place so that the Ministry can start working on longer-term initiatives, regardless of the political cycle.
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- K. Boudreau and K. Lakhani. How to manage outside. MIT Sloan Management Review 50, no. 4 (Summer 2009): 68–76.
- K. Boudreau and K. Lakhani. Using the crowd as an innovation partner. Harvard Business Review 91, no. 4 (April 2013): 61–69.
- J. Howe. The rise of crowdsourcing. Wired (June 2006).
- A. King and K. Lakhani. Using open innovation to identify the best ideas. MIT Sloan Management Review 55, no. 1 (Fall 2013): 41–48.
- K. Lakhani and J. Panetta. The principles of distributed innovation. Innovations: Technology, Governance, Globalization 2, no. 3 (Summer 2007): 97–112.
- https://www.argentina.gob.ar/modernizacion (last access: 11/10/2018)
- https://www.argentina.gob.ar/modernizacion/gobiernoabierto (last access: 11/10/2018)
- Image: verdict.co.uk (last access: 11/10/2018)