Beyond Bureaucracy: Open Innovation in the U.S. Government
Could open innovation initiatives allow U.S. governmental agencies to tackle intractable problems more quickly and cost effectively? Could the U.S. government effectively transition to open platforms to address its most contentious and politicized challenges?
“With informed discussion, creative thinking, and timely legislative action, Social Security can continue to protect future generations.”
– 2018 Trustee Report on Social Security [1]
“Limiting warming to 1.5°C would require transformative systemic change, integrated with sustainable development. Such change would require the upscaling and acceleration of the implementation of far-reaching, multi-level and cross-sectoral climate mitigation and addressing barriers.”
– IPCC Special Report 15 on Global Climate Change [2]
Over the next twenty years, the government of the United States of America faces challenges in funding the country’s existing social benefits programs or redefining such programs’ benefits for future recipients. In addition to these and other formidable domestic challenges, experts in the scientific community suggest that stemming global temperature and sea level rise will require a concerted effort from all world governments, including that of the United States. Figure 1. [3] below illustrates current temporal trends towards critical milestones in benefit funding and climate change. In order to address these challenges under such a time constraint, government bodies in the United States stand to benefit from rapid and cost-effective ideation and solution development.
Open innovation initiatives offer one path forward towards this combination of cost efficiency and speed for addressing these critical issues. Importantly in the governmental context, open innovation platforms have been cited to increase organizations’ cost efficiency and innovation even in monopoly conditions. The “X-efficiency” concept describes the efficiency of an agent operating in a near monopoly environment that lacks competitive pressures. A study by JinHyo Yun, et al. indicates that installing transparent economic devices that enable the public to participate in product or process development activates user-based open innovation and enhances enterprise “X-efficiency”. [4] On the speed front, research by JinHyo Yun, et al. also indicates that open innovation platforms activate “economies of diversity” that identify niche market needs and rapidly draft solutions around these needs. [5]
For its part, the U.S. government has already taken steps towards open innovation over the past decade. The modes by which the government has participated in open innovation can be categorized in two ways: an inside-out approach of increased transparency to public data and an outside-in approach of gathering inputs for particular projects. On the inside-out front, the Data.gov and Regulations.gov initiatives illustrate this new paradigm of transparency. Underpinning these repositories is the idea that a common knowledge base of data provides a starting point upon which innovation from outside can be built. Importantly, these datasets are as openly available as they are machine legible, allowing not only public users to access them but also allowing for the programmatic consumption of the information. Crowd-sourcing and public competition are the main mechanisms by which the government is entertaining outside-in inputs for innovation. As a mechanism for gathering public insights on pending patents, the US Patent & Trademark Office’s “Peer-to-Patent” program is an illustrative example of crowd-sourced innovation. In the initial pilot of the program, a peer reviewed patent set demonstrated a significantly lower need for prolonged review by the patent office, as compared to the overall patent population. [6] Further examples of the outside-in approach are evidenced in the Presidential Innovation Fellows program that staffs industry experts inside government agencies and in the USAID’s Development Innovation Venture (DIV) program that seeks to fund innovative product offerings submitted by the public.
While attempts at open innovation have been made over the past decade within the U.S. government, the examples thus far have kept distance from the contentious and politicized arenas of public benefits reform and climate change solutions. In the near- to mid-term, the government should seek to open the dialogue and challenge these existing open innovation networks to address such contentious issues, allowing the discussion to progress in a bottom up way towards solutions. Open innovation as we have seen it in the U.S. government so far has been relegated to behind-the-scenes efficiencies (Peer-to-Patent) and tangential product offerings (DIV) but has not fully entered the arena of civic engagement in public policy. The government would do well to experiment more with these open platforms in these areas even if only in limited ways to begin daylighting, discussing and pushing for innovative policy and cost solutions to these more intractable and time-constrained issues.
As the government continues to explore open innovation networks, a few questions arise as to how these networks may reshape existing government operations. Firstly, can an effective open innovation platform feed into the “front-end” of government in policy making or will these networks only feed “back-end” efficiency and tangential service offerings? In a related way, if an open innovation platform does cross over into the policy making arena – does traditional bureaucracy exist alongside the network in a purely additive way or does the open network replace certain rungs of agency control? Or is there another mode of coexistence altogether?
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[1] “THE 2018 ANNUAL REPORT OF THE BOARD OF TRUSTEES OF THE FEDERAL OLD-AGE AND SURVIVORS INSURANCE AND FEDERAL DISABILITY INSURANCE TRUST FUNDS” THE BOARD OF TRUSTEES, FEDERAL OLD-AGE AND SURVIVORS INSURANCE AND FEDERAL DISABILITY INSURANCE TRUST FUNDS (Washington, D.C., June 5, 2018).
[2] Myles Allen, et al. “Special Report on Global Warming of 1.5 Degree Celsius: Technical Summary,” IPCC , 2018, http://report.ipcc.ch/sr15/pdf/sr15_ts.pdf accessed November 2018.
[3] Climate data source: “Climate System Scenario Tables (Annex II of IPCC 5th Assessment Report, WG1 — as Excel workbook”, “All-7-6”, A1T temperature assumptions.
Social Security data source: “https://www.ssa.gov/oact/TR/2018/lr4b4.html”, Intermediate forecast assumptions.
Medicare data source: “https://www.cms.gov/Research-Statistics-Data-and-Systems/Statistics-Trends-and-Reports/ReportsTrustFunds/index.html”, 2018TR Figures.xlsx, II.E1
[4] Jinhyo Joseph Yun, et al. “An Exploratory Study of Economic Effect of Open Innovation,” January 2014, ABI/INFORM via ProQuest, accessed November 2018.
[5] Jinhyo Joseph Yun, et al. “An Exploratory Study of Economic Effect of Open Innovation,” January 2014, ABI/INFORM via ProQuest, accessed November 2018.
[6] Naomi Allen, et al. “Peer to Patent First Pilot Final Results,” Center for Patent Innovations at New York Law School, 2012, http://www.peertopatent.org/wp-content/uploads/sites/2/2013/11/First-Pilot-Final-Results.pdf accessed November 2018.
I agree that the government suffers from serious inefficiencies and a lack of creativity when looking at important issues – the more good ideas they get, the better! However, I think that I would prefer to get better talent into government jobs, rather than relying on ideas from the general population – it is difficult to imagine that contributions will not be significantly politically charged (especially concerning difficult issues like Social Security), which would seem to somewhat breakdown the democratic process by potentially shifting decisions away from elected officials. I guess that it depends more on how these ideas are organized, considered, and potentially implemented though and hopefully it could be done in a way that avoids these conflicts because I do think it is important to consider alternative perspectives when looking at difficult issues.
While reading this, I could not help but think of the open source platform the Obama administration implemented. Whenever a certain number of “likes” were made on a specific post, the administration promised to post a response. Unfortunately, while there were good things posted, many questions were extraneous, politically charged, or just ignorant. I would be afraid that the same would happen here and therefore agree with Howard Hughes’s comment that the government should simply have better people elected/appointed.
Ideally, open sourced idea generation would be great. More ideas, often by people closer to the issues. However, issues arise in the ranking of these ideas. There may be people who have little knowledge of the topic and are unable to both effectively rank ideas on merit, but are also unable to recognize their inability to do so. I would prefer government taking a more “consumer-centric” approach to governance, considering the electorate more frequently than during election periods. Where open-sourcing ideas can assist in this, I believe there may be some beneficial opportunities.
The main barrier I see to open innovation initiatives in shaping U.S. policy is inertia on the side of the policymakers themselves, rather than the difficulty of building an efficient open innovation platform. Back-end efficiency, as you put it, may be the only practical application of open innovation given the partisanship of governmental bodies. Systems such as petitioning and lobbying are, in some sense, a version of open innovation–albeit a more diluted and perhaps inefficient version–and it seems difficult to conceive of a system in which ideas that are any less publicized and well-funded would gain traction. I agree with you however that the process of shaping public policy needs to be improved, and it would be interesting to see whether the government is open to implementing crowdsourced solutions.
Great post! I agree with JJY that the main barrier to efficiency in the public sector is the inertia on the side of policymakers, but I do agree that open innovation can play a role. I see the main issue as misalignment of incentives and free information flow, both of which could be supported with public pressures via open innovation. I’ve worked with public figures who inherently see the value of a certain initiative, but cannot support it due to internal barriers and red tape, not because it is an inferior option to the status quo. By adding more transparency as to why certain initiatives or bills are held up, the public could be more critical of certain actions policymakers take, and bring light to these issues. For example, if a beneficial program for needy schools was held up because a certain policymaker would prefer to fund their friend’s less-effective initiative, there could be an anonymous and open platform where fellow policymakers make these facts public, and constituents would better know where to funnel their voices to add pressure in the most effective way.
One of the questions that also arises from this piece goes into the nature of US politics, where so many less visible stakeholders are involved. For front-end changes, the end consumer (or citizen) is much more aware of what changes could or should be imposed, rather than some of these back-end solutions. Therefore, the political bipartisanship that is driving much of the US politics’ direction could play a role in the type of solutions or proposals, as well as the acceptance of these changes.
I think you identified the rub when you wrote that so far the open innovation program has avoided the particularly polarizing issues. The challenge with questions like this — organizational innovation in government — is it is merely a method of achieving a goal. But it doesn’t tell you what the goal is. Yes, if the goal is to tackle global warming or save social security, then this may be a far more efficient way of sourcing the best ways to do those things. But, excuse my cynicism, that’s not really the challenge in our government today. The challenge is agreeing whether we should fight global warming, or whether social security should die and be replaced. These are the principled questions that ultimately matter and no organizational or process change to operations can really change that. It’s important, no doubt, but won’t actually decrease polarization by itself. It reminds me of another oft-discussed process/operational change that’s been touted as the silver bullet of polarization: changing the process by which we draw districts (gerrymandering). But most political science literature says gerrymandering isn’t really the problem, though that would be great if it were. The problem is we tend to be a more polarized electorate that live, eat, school near people that think like us — and increasingly think different than others (think urban vs rural political divide that has grown, whereas both constituencies broke more evenly for both parties in years past). I think ultimately then that open innovation will help us come up with new solutions to problems we agree on tackling; but it won’t do much to help reduce our disagreement about which problems to tackle.
Very interesting read. I’m a fan of the topic of open innovation, and I can see how governments around the world can make use of that, especially in the service sector, as in the services governments provide to its citizens. I’m not in favor to open innovation in the policymaking, since it might isolate a number of people from the decision-making process (those who don’t use the internet, or just don’t have the time to participate) and second might be a potential area for foreign government to start influencing of some way or another.
Your article reminds me of the participatory budgeting that the City of Cambridge (along with a few others) currently uses (https://pb.cambridgema.gov/) Essentially, citizens get to vote with their taxes on which projects the city if going to fund. Everything is extremely transparent and citizens are more engaged and they have an actual, measurable voice in each proposed project.
Unlike the previous comment, I do think that open innovation will help us come together and bridge the political and social gap that is plaguing the United States. Especially in the past few years, politics has become less about the issues and more about “us vs them”. Even if people agree with some aspects of the opposing political party, they are forced to eventually pick a side (or lose as an independent) and we become even more polarized as there essentially is no middle ground. As you indicate in your essay, open innovation might help us solve this issue as we isolate ideas from political party and have people work together to come up with beneficial solutions. It’s a tall order to think that it will impact the US in the short term, but I hope that eventually open innovation will help us to work together to solve problems and help us overcome the divisiveness in America and around the world.
I hadn’t thought much about open innovation applications in the government space until reading this article. Functioning much like a think tank, I think the applications of open innovation in this space are very interesting and could be significant. One of the concerns I have, however, deal with proper vetting for ideas. If you consider how many bogus petitions (etc.) are submitted to our government on a monthly basis (i.e. to change the national anthem to the Star Wars theme song), I worry that a truly open ideation platform may have the same quality of comments and level of engagement. The potential is great, but I think some vetting process should be in place to ensure quality ideas are submitted in addition to a proper incentivization system to encourage people with the “bright” ideas and appropriate experience to contribute.