In his recent book ‘Adapt’ Tim Harford takes a Darwinian view of ideas and organisations arguing that failure is essential to future success. It’s quite easy to see how this approach may appeal to the swashbuckling entrepreneur and find support in the cut and thrust of the market. However, what does it mean for public sector managers?
Councils are famously risk averse – forthcoming LGiU research finds that over half of all UK councils agreeing that they’re either risk averse, or very risk averse. The dominant culture in local government then has a low tolerance threshold for failure. Harford himself concedes that electorates reward politicians who don’t admit to failure but insist that ‘they are not for turning’, ‘have no reverse gear’ or ‘there is no plan B’.
Does this mean that local democracy is doomed to remain fixed, immobile and irrelevant?
Well not quite. Harford cites the 10% failure rate of business in the US as a sign of robust good health. For politicians swings to the left and the right produce similar ‘failure’ rates. Of the councils that existed 20 years ago many have changed, gone unitary or disappeared altogether. The services local authorities’ offer has also undergone near constant change and in the case of some outsourcing models there has been outright failure as contractors have gone bust or walked away. So as with business failure is a combination of the predictable, the internally generated and the random.
Harford argues that the way to remain strong and useful is to innovate and that requires experimentation which in turn inevitably results in some failures. A similar conclusion was reached by Nicholas Taleb author of Black Swan. Taleb argues that unpredictable events, so called Black Swans, are a part of life and the only sensible response is to build resilience or remove fragility. Taleb argues that we can learn from nature whose systems have built in redundancy, duplication, blind alleys and high failure rates.
It is hard to imagine the Treasury meeting where one successfully sold duplication and blind alleys as a good thing for the public sector. In fact efficiency drives and initiatives like community budgeting usually result in the identification of the one ‘best practice’ single contract solution. Harford an
d Taleb seem to suggest that is in turn results in the most fragile way of running local government. The policy counterweight to community budgeting is the Big Society. It is in the Big Society that the experiments are ran, failures excused, blind alleys explored and duplication tolerated. Sounds like fun, except that this is precisely the part of localism that is least well understood or thought through.
The LGiU has been conducting research on the Big Society and our primary concern has been the continuance of service provision in the event of a failure.
The lessons from outsourcing are of limited value here because they tend to start with a lengthy procurement process and a complex contract – neither of which can be fixtures of the Big Society if we seriously want ordinary people to get involved.Councils want and need to build sustainable models of service provision yet are constrained by the tools and models available.
One approach could be for the council to take a view on the importance of the service and state in advance whether it will step in to save it, prop it up for a bit, ask another organisation to step in or simply allow it to end. Of course for this to work the council and society need to confront and accept failure. In life and politics it’s usually a good idea to have a Plan B.
