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This website was created by the OECD Observatory of Public Sector Innovation (OPSI), part of the OECD Public Governance Directorate (GOV).

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Innovative Capacity of Governments: A systemic framework

Building innovative capacity – the time is now

Given the increased complexity of the world and emergence of wicked problems faced by governments including climate change, infectious diseases and rapid technological advances, enhancing the innovative capacity of governments and public sector systems has become an imperative. It’s not enough for governments to maintain the status quo, or innovate only when forced by crises. Governments need to proactively engage with the future, explore the potential of innovative approaches and solutions and work towards constant improvement of all lives.

OPSI developed this Innovative Capacity Framework as a practical and systemic framework to guide governments in strengthening their ability to leverage innovative approaches and solutions as an integral part of policymaking and public administration. Ultimately, the Framework helps governments steward their public administration systems to build more holistic, impactful and sustainable solutions and improve the lives of citizens.

For innovative capacity to flourish, we need to move away from innovation as a sporadic activity, fuelled predominantly by crises, to systemically embedding innovation at the heart of policymaking and public administration.

Innovative Capacity: The Framework

For innovative capacity to move beyond niche pockets towards a strategic tool that is cultivated and leveraged across the entire government system, we need to: be intentional and systemic so that governing mechanisms can drive innovative efforts (purpose), create the culture and space to enable innovative efforts (potential), ensure the availability of the right skills and resources and that innovative capacity is integrated into the rules, practices and workforce (capacity) and understand and learn from efforts (impact). Innovative capacity is crucial for governments to design and deliver ambitious reform agendas, meet climate targets, respond to global crises and shape better futures. Without a deliberate understanding and effort, the dynamics of the public sector system will continue to push forward the status quo operating methods.

Figure 1 The Framework: interactions between the three levels of analysis (individual, organisation and system) and the four focus areas (purpose, potential, capacity and impact)

Frames of Focus

To better understand innovative capacity, this framework explores key drivers, enablers, barriers, capacities and impacts etc. through four key questions:

Purpose: What is driving the intent to innovate?

Without clear motivations and drivers, innovation is unlikely to show up consistently in a historically shaped, path-dependent public sector system. These drivers can come from global shocks and crises, but they can also include deliberate mechanisms to motivate organisations (ex. Organisational mandate that clearly signals the need to innovate) or individuals to innovate (ex. Recognition/awards for innovative activity).

Potential: What elements across the system influence whether innovative efforts are attempted?

While there may be a clear driver for innovation, and perhaps even the skills and capacities for it to take shape, there are a number of barriers that can prevent innovative efforts from being attempted. A common barrier is the perceived system culture: at times, actors feel that they don’t have the autonomy, ownership or opportunities to try new things, take risks and experiment. Creating potential for innovative capacity could look like clear leadership direction in support of using innovation to achieve goals, engaging courageously with risk and creativity and deliberate efforts to support iteration, exploration and experimentation.

Capacity: What is needed to carry out innovative efforts?

Leveraging innovative approaches requires creative mindsets, practical abilities and deliberate supports. Innovating needs to be integrated into the everyday practices, rules and culture of the public sector system and be embedded into its governing mechanisms. This can be the use of portfolio approaches, specific innovative capacities embedded into policymaking such as systems thinking, foresight and behavioural insights, support by flexible procurement and funding mechanisms, flexible regulatory rules and contemporary and agile project management approaches and mechanisms to engage across sectors.

Impact: How is the impact of efforts understood and informing future practice?

There is a need to demonstrate the value and shifts made by investments in the public sector – this goes for implicit or explicit innovative efforts as well. Such investments need to be understood and evaluated to help inform future decision-making and investments. This requires mechanisms to understand the impacts of innovative efforts, constantly learning loops and skillsets to measure and evaluate innovative capacity at large. This also requires the use of contemporary, systemic and impact-based evaluative approaches to consider how innovative efforts link to broader policymaking and public administration efforts.

Factors which influence innovative capacity

The Framework guides the exploration and reflection different dynamics within a system (which can be tailored to a whole public sector system, a policy sector or a policymaking system).  While systems require consideration of all elements and actors and their interactions, the Framework supports practicality by organising critical analysis against  three levels (individual, organisation and whole of system) and the four focus areas (purpose, potential, capacity and impact).

Table 1: Innovative Capacity Framework – key factors and variables.

Learn more

The innovative capacity framework aims at highlight key focus areas for building and understanding innovation capacity. It also showcases how innovation needs to be embedded and interact with the entire public administration and governing system; including how it interacts, is understood and is influenced by drivers, factors, capacities and supports across the system. You can read more in our working paper: Innovative capacity of governments: A systemic framework available for download.

Innovative Capacity of Governments: A systemic framework

Published on 1 April 2022.