Report touts innovation as a key tool in confronting shrinking budgets

Successful innovation could help bridge the gap between rising expectations for the public sector and the dwindling budgets many federal agencies face, according to a new report.

The report by the Partnership for Public Service, a nonpartisan nonprofit focused on the government workforce, and IDEO, a design consultancy, outlines concrete actions agencies and federal employees could take to overcome obstacles to innovation, a theme of President Obama's State of the Union address last month.

"Innovation can improve quality of service, but it can also improve the bottom line," said Tom Fox, director of the Center for Government Leadership at the Partnership for Public Service, during a conference call on Wednesday.

In fact, fostering creativity can be more effective than some other proposed methods of addressing budget problems, according to Fox. He called the recent push to reduce government head count a bad management strategy, saying studies show money saved by eliminating federal jobs instead "just gets spent on contractors." In January, Republican lawmakers proposed cutting the federal workforce by 15 percent by hiring one new employee for every two leaving.

The report identified four barriers that stymie innovation within the government, including an incentive structure that rewards the status quo. Government employees are expected to meet common standards, but are not rewarded if they push the envelope, the Partnership and IDEO found.

The report also said a lack of metrics to gauge program success hinders government innovation. While private sector programs and research often can be evaluated based on whether they make -- or lose -- money, federal agencies frequently have to assess whether initiatives achieve harder to measure goals such as improving national security or producing a cleaner environment.

The report defined innovation more broadly than simply invention, saying government workers could innovate by finding a better way to complete a task, implementing a tried idea in a new context, and developing a new process to achieve agency goals.

It highlighted the Social Security Administration's use of Internet videoconferences to interact with citizens in rural areas as an example of improving on a pre-existing government service. Fox lauded SSA not only for the result, but also for the process behind the new program. Social Security first launched a prototype at one site, and then implemented it at scale after the test proved successful.

New programs like the Transportation Security Administration's IdeaFactory, an online tool that enables TSA employees to suggest strategies for fine-tuning the agency's operations and learn about initiatives being tested to improve service, also show "a lot of promise," Fox said. Part of the problem, he said, is the government is not doing a good job of promoting the cutting-edge work already taking place.

Fox said Partnership for Public Service expects to release a second report in March that will focus on leadership skills necessary to foster a culture of innovation.

"Leadership is a real necessary part," he said, noting agencies "need to have the right people involved."

During the research process for Wednesday's report, the authors interviewed more than 100 "innovators" from about 50 public, private and nonprofit organizations, asking what they saw as strengths and weaknesses in the public sector, and where proven private sector strategies could be implemented in government. After coming up with a set of potential solutions, the authors went back to the innovators for feedback to make sure each proposal added to the conversation and could be reasonably implemented, the report said.