Country scan: the public sector innovation system of Latvia 

The Observatory is conducting an analysis of the public sector innovation system of Latvia, and we would like to share a project overview and update for anyone interested in innovation systems, the research approach, or how international lessons learned can help officials understand their own contexts. 

To begin: what is a public sector innovation system? 

A public sector innovation system can be seen as the set of organisations, capacities, laws, policies, processes, cultures, and on that collectively influence the extent to which innovation does or does not happen in government programs, policy, and service delivery. For necessity and study, we reduce this to a focus on the most impactful elements that tend to transcend individual experiences. For instance, an individual manager may be the most crucial element of the innovation system for the employees under them, but this has to be out of scope for a review of a national innovation system. 

An innovation system is more like a recipe than a set of building blocks. Changing system elements can change how innovation manifests in disproportionate ways.  

From OPSI’s previous reviews, there is an emerging understanding of the characteristics of national systems that positively influence innovation. That is, those that have forces supporting and encouraging innovation in excess of those forces stifling or dampening it (the ‘innovation determinants’).  

For example, a jurisdiction might have a system for all front-line employees to propose citizen service improvements, which automatically get reviewed and triaged, then backed by a service lab to help research and test the change. Another jurisdiction might have a procurement model designed to connect government programs with private sector experimental technologies for testing. While neither chain of systems elements represents the whole system, they represent likely parts that would be revealed through research, and that would influence the whole. 

We begin to understand countries’ innovation systems through country scans and country studies. 

Background: country scans and studies 

OPSI conducts country work through interviews, workshops, and desk research to understand and reveal system elements. This process is more about drawing out the knowledge and insight within a system, making it visible, and reflecting it back to interested parties and decision-makers. Until a system is visible, it is not possible to engage with or try to change it in a deliberate way. An invisible system will mean behaviours, practices, and processes are shaped by forces unseen, making it unlikely that there will be a clear connection between intent and what actually occurs. 

• Country studies: in-depth and thorough studies
• Country scans: preliminary research to generate high-level insights and hypotheses

Additionally, we are able to provide examples and lessons learned from across the world. The Observatory does as the name implies: we observe emerging practices across (and beyond) OECD member countries to distill replicable elements and principles, supporting the collective progress of countries. A growing critical mass of practices and approaches are captured in case study library, our Covid-19 innovative response tracker, and our toolkit navigator. In parallel, we work to connect academic, gray, and practical knowledge to help explain the underlying systems of innovation – for instance, the innovation facets model. 

Country scan of Latvia 

Latvia’s recent efforts to foster an innovative government are set against a longer backdrop of public sector reform and professionalization initiatives, and that is set against increased economic and political integration with Europe, including joining the European Union in 2004 and the OECD in 2016. 

While there are many examples of successful innovation efforts across the Latvian public sector, a systemic approach is still emerging. 

There is a cluster of elements that represent intentional, structural supports for innovation, centered on #GovLabLatvia and the School of Public Administration. The lab, launched in 2018, is entering its second season of supporting the use of human-centered design principles in public sector work. The School complements this through a well-regarded series of practitioner and executive courses in service design principles. 

Counterweights 

Meanwhile, system elements that dampen innovative initiatives remain, including a premium on ensuring fairness, accountability, and withstanding scrutiny for public spending. Which is, of course, of crucial importance; the question is the extent to which controls lead to outputs versus outcomes, and recognizing that prescriptive approaches often provide a false sense of certainty in addressing complex problems. Procurement rules, the overarching legal framework, the political/public service interface, and the prospects of audits were referenced as reasons to avoid the new and novel. 

“We are trying to do things right, but we are not doing the right things.” 

“[There is a] mismatch between need and public law.” 

– quotes from stakeholders interviewed by OPSI 

However, this could be part of a very long and deep causal chain. To generate a culture where senior decision-makers trust the system to experiment in complex policy areas and then propose the most successful interventions, there first must be the capacity to both experiment and provide sound advice. Multiple interviewees felt that the root causes could be traced to public sector salary levels and job market competitiveness, and even to secondary maths and science education. 

Fragmentation  

The central theme from interviews has been “fragmentation.” That is, where innovation occurs, it is more likely to be a result of individual willpower and interest than systemic forces. Successful experiments are unlikely to spread practices or lessons learned.  

Part of the reason for this may be a perceived lack of a common mission or direction for innovation. While Latvia has a series of national seven-year development plans, we heard that their breadth made it hard to identify areas of focus, and that these national development plans documents were not influencing individual public servants’ approaches to their work. 

Questions to explore further in the scan 

Some potential avenues for exploration that may be of interest to the OPSI community: 

• Using a strong digital foundation to explore innovative approaches 
• Building a critical mass and system support for pathfinder successes 
• De-risking experiments through public/private collaboration, transparency, and support 

Next steps 

As with the OPSI studies of Canada, Brazil, and Israel, the work with Latvia will be available on the OPSI website both as project updates and a final narrative report. 

If you are interested in OPSI’s country work for your own context or as a peer observer of the innovation journeys of governments, please get in touch – happy to chat.