The rise of innovation labs in the public sector (part 2)

By Piret Tõnurist, Rainer Kattel, Veiko Lember (Ragnar Nurkse School of Innovation and Governance, Tallinn University of Technology in Estonia)

In our last post we mentioned a few reasons for why innovation labs are emerging in the public sector. Despite the fact that i-labs are increasingly popular in the public sector, there is almost no systematic academic overview of these organizations. In what we think is a first comprehensive attempt to map and analyze such labs globally, we identified and analyzed 35 such organizations (full study is available here).

On the whole, innovation labs both in the private and public sector are very heterogeneous – in terms of their activities, scale and organizational structures – making them difficult to map and analyze. Thus, we decided to base the research on a two-step approach: first, a comprehensive survey was carried out directed at the management followed by an extensive in-depth interview with the same managing figures of i-lab. The survey is based on long-term and large scale research into public sector organizations in Europe: the COBRA research project. Based on proven structure and logic, the COBRA questionnaire addressed the autonomy of agencies towards their political and administrative principals on different dimensions. The questionnaire also helps to sheds light on the way agencies are controlled by their principals and what kind of internal management tools the agencies use. This helps us to compare i-labs to other (semi-)autonomous public sector organizations. However, due to the specific nature of i-labs, the questionnaire had to be significantly updated to fit our purposes of the research. The survey was followed by an in-depth interview in which we more specifically covered the reasons behind the creation of the lab, team characteristics and main tools, network partners, activities and goals, outcomes and steering and control. The research design was tested prior to use with the representative from Mindlab, Denmark.

Based on prior reports by Nesta, IBM, Parsons “Gov Innovation Labs Constellation 1.0” and web-based searches, we identified 35 i-labs inside or directly funded by the public sector; 11 i-labs responded to our survey.

Our key findings:

• I-labs are rather unique organizations and diverse in their mission, expected to act as change agents within public sector and enjoy large autonomy in setting their targets and working methods.
• I-labs are typically structurally separated from the rest of the public sector and expected to be able to attract external funding as well as “sell” their ideas and solutions within the public sector.
• I-labs tend be small structures, specializing on quick experimentations and usually lack the capabilities and authority to significantly influence up-scaling of new solutions or processes.
• The main capabilities of i-labs are their ability to jump-start or show case user-driven service re-design projects. Interestingly, IT capabilities do not appear as prominent characteristics of the studied i-labs.

In sum: i-labs, although prominent in many modern public management strategies, are yet far from becoming truly organic parts of the public sector. This is paradoxically both their weakness and their strength. I-labs conform rather well to a type of organization Max Weber called charismatic organizations: new units that coalesce around idiosyncratic values and rules, with its own belief systems and working patterns. For Weber, such organizations were often in conflict with existing organizational patterns. In his early work, Schumpeter also believed that it is precisely such charismatic new organizations that bring forth disruptive changes in society and lead to emergence of new values embodied in new firms (and other new organizations, such as new political parties, artistic movements, etc;).

I-labs in the public sector are then perhaps to be understood as organized attempts to respond to ICT technological revolution taking place in societies at large. In this sense, we can understand i-labs as spaces of experimentation in a longer process of learning and adapting to ICT driven world.