1. Session on Delivering public services – adding value to citizens through co-production

2. Prof. Dr. Stephen Osborne
University of Edinburgh

3. Delivering public services: adding value to citizens through co-production?
Professor Stephen P Osborne, Director of the Centre for Service Excellence, University of Edinburgh Business School, Scotland

4. Centre for Service Excellence, University of Edinburgh Business School

5. Centre for Service Excellence
University of Edinburgh Research and Engagement Centre
Cross-school and concerned with public and private services
Research into effective service delivery
Engaging with service firms and organisations to improve service delivery
Working with our UG and PG students to prepare them for working in the service sector
Centre for Service Excellence
Centre for Service Excellence, University of Edinburgh Business School

6. What are public services?
NMP is flawed and failed
Public services are… SERVICES
But different…
NOT products
Intangible, process-based, co-produced with citizens
Are on a continuum and contain concrete elements
Value for public services is subjective and values-based
What do your citizens value?
How do you resolve differing perceptions of value based on differing value-bases?
Public service management is a process of NEGOTIATION
Public services are only promises. Real value is only value-in-use and value-in-context. Performance management is (relatively) meaningless
Are delivered in service systems
SO…
Understand expectations (which frame experience)
Understand differing value-bases
Understand the need to negotiate between these value-bases
Understand the role of citizens at the centre of co-creating/co- producing public services
Understand public services only promise value. In reality it is a dynamic concept
What are public services?
Centre for Service Excellence, University of Edinburgh Business School

7. What is ‘value’ (not)? What value is not…
…Just another word for service effectiveness or outcomes
…Simply financial value
…Created internally in Public Service Organisations (PSOs) by internal value chains (Lean)
…Public Value…
What is ‘value’ (not)?
Centre for Service Excellence, University of Edinburgh Business School

8. Overarching definitions of value
OED
Value: ‘The regard that something is held to deserve’
Marx
Value is determined by ‘…the amount of labour necessary to the production of a marketable commodity.’
The process of production determines value
Pilkington
‘Value is attributed to objects due to our desire for them. This desire, in turn, is inter-subjective [and socially determined].’
The process of consumption determines value by its symbolic nature
But what of values???
Centre for Service Excellence, University of Edinburgh Business School

9. New Public Management and value
Value as indicator of the public service production process
Transformational process of inputs, outputs and outcomes for ’value for money’
Three E’s (Economy Efficiency and Effectiveness) & CCT - transactional atomised contracts employing the market to reduce costs and increase (economic) ‘value’
Best Value 4 C’s – Challenge, Compare, Consult, Compete
Is this value – and where are values?
Centre for Service Excellence, University of Edinburgh Business School

10. (III) Public Value 1
Public value is created by public managers just as private managers create commercial value – it is determined by and distributed to citizens as shareholders (Moore 1995) – Shareholder driven
‘[A] reflection of collectively expressed, politically mediated preferences consumed by the citizenry’ (O’Flynn 2007) - Demand driven
‘[T]he value created by government through services, laws regulation and other actions’ (Kelly et al. 2002) - Supply driven
[Value] is collectively built through deliberation involving elected and appointed government officials and key stakeholders’ (Stoker 2006) – Politically driven
Public value as values driven
Private value (‘rubbish is collected’) vs public values (‘a sustainable society’)
Key role of trust in creating and sustaining public value (reduced refuse collections)
Centre for Service Excellence, University of Edinburgh Business School

11. Public Value 2
BUT
Who determines the ‘values’ of, and the ‘value’ in, Public Value?
And how to arbitrate conflicting value positions?
Ultimately, PV is a policy making tool not a service delivery one
Centre for Service Excellence, University of Edinburgh Business School

12. So… what is ‘value’? Value is…
…About how PSOs positively change the lives of citizens
…Dependent upon the values that citizens hold (frames expectations and mediates experience)
…Socially constructed and subjective
Values are an input, value is an outcome… and frames the future
...Created externally to PSOs
Without an external focus you just create very efficient but permanently failing PSOs
So… what is ‘value’?
Centre for Service Excellence, University of Edinburgh Business School

13. 4 dimensions of value for PSO
Meet the social or economic needs of citizens/communities
‘Fit for purpose’ (expected but not indicator of satisfaction or quality)
Outcomes
Improve the quality of their life experience
Lived experience
Create capacity for citizens/communities to change in the future
Individual/social capital
Make Scotland a ‘’better’ society
Public value
Public Service Organisations only facilitate value creation - value is only created by citizens and service users
4 dimensions of value for PSO
Centre for Service Excellence, University of Edinburgh Business School

14. How is value create in public services? (I/IV)
I – Co-experience
Not citizen/user empowerment or control but a partnership
Is a constant in public services – part of being a service
Is intrinsic/unconscious not voluntary
PSOs need to work with it - not against it or in ignorance of it
Is being re-framed and changed by digital/smart technology
Public service professionals from the holders to the interpreters of knowledge
How is value create in public services? (I/IV)
Centre for Service Excellence, University of Edinburgh Business School

15. How is value create in public services? (II/IV)
II – Co-construction
Public services are changed by the life experiences that citizens bring to them, and
Public services change the life experiences of citizens to create a lived experience, irrespective of outcomes
This creates service satisfaction, but is much more than that – well- being - or not…
How is value create in public services? (II/IV)
Centre for Service Excellence, University of Edinburgh Business School

16. How is value create in public services? (III/IV)
III – Co-production
The conscious involvement of citizens in the delivery of their public services
Needs a framework and expectations about what can/cannot happen
May empower citizens by their taking control of their lives
Needs to be facilitated in the beginning (‘learning to and learning from’)
Creates capacity in citizens to take control in the future (c.f. private sector services)
A partnership
How is value create in public services? (III/IV)
Centre for Service Excellence, University of Edinburgh Business School

17. How is value create in public services? (IV/IV)
IV – Co-design and Co-innovation
Role of citizens in improving existing public services/creating new forms of public service
Led by their needs but co-created with professionals (expertise) and politicians (mandate/resources)
Unlock the ‘sticky knowledge’ of service users – where most innovation in service delivery comes from
Digital/smart technology is changing the ability of citizens to access information and take the lead in public service change
How is value create in public services? (IV/IV)
Centre for Service Excellence, University of Edinburgh Business School

18. Co-design & co-innovation
Value creation matrix
VALUE PROCESS/
VALUE CREATED
Outcomes
Lived experience
Capacity
Public value
Co-experience
Co-construction
Co-production
Co-design & co-innovation
Co-destruction
Centre for Service Excellence, University of Edinburgh Business School

19. Creating value must be externally focused not internally focused
Need to balance underpinning values of public services and the value they create – ‘value’ is ‘value-based’
A process of negotiation – between differing value-bases, resource constraints, and capacity
Co-production is just one of a cluster of processes through which value can be co-created/co-destroyed with citizens
It is as possible to create unwanted value and/or to destroy value by public service delivery as to create it.
Has the citizen at the centre, not at the end or the periphery, of creating value through public service delivery
Finally…
Centre for Service Excellence, University of Edinburgh Business School

20. Discussion by Prof. Dr. Elio Borgonovi
Bocconi University

21. Delivering public services: adding value to citizens
Discussant
Elio Borgonovi
President of CERGAS, Bocconi University

22. KEY ELEMENTS OF PUBLIC SERVICE DEFINITION
Stephen’s presentations is insightful and inspiring.
I want to underline some concepts:
Dynamic process vs bureaucratic rigidity
Different value-basis: it raises the problem of democracy (crisis of Western countries model) and of inclusive society (different from selection and simple integration)
Co-production: from the technical point of view is common for all services (public or private); the peculiarity of public service is involvement, engagement, empowerment that are much more difficult to obtain from market driven services
Peculiarity of public value: understanding the environment, agreeing among different interest groups, evaluating processes

23. THE CONCEPT OF PUBLIC VALUE (1)
It’s fascinating for me the distinction between:
Values as input
Value as outcome
I’m not sure to understand it correctly, but in my mind ‘values as input’ means that people and social groups behave and interact with public administration (co-produce) on the basis of their concept/philosophy of life (egoism/altruism, utility, ethics, religion, etc.).
‘Value as outcome’ is a result of an evaluation process by those who interact with public administration based on how services actually meet needs, perceptions, expectations.
Public value definition needs to clarify:
How PA meets needs
How PA respects rights
How public services contribute to recover, maintain and consolidate community relations, that means how they contribute to social capital

24. THE CONCEPT OF PUBLIC VALUE (2)
Public value has a different meaning if we consider public service as:
Commons (that affect the entire community)
Merit goods (they provide individual utility but are guaranteed by public choice process)
A mix of both (transportation, education system)
Anyway, the critical aspect is public value measurement:
Ex-ante for decisions
Ex-post for evaluations

25. PUBLIC SERVICE MANAGEMENT
I agree with the idea that public service management is basically a negotiation process based on trust
I do not completely agree with the statement ‘performance management is (relatively) meaningless’
Actually, negotiations require:
A better clarification of what you negotiate
A precise, detailed, explicit definition of objectives and quantitative and qualitative indicators because there is no market price (as it happens for many public services)
The agreement on the methodology of result measurement in order to compare with the objective
The maintenance of ex-ante and ex-post indicators to built and to strengthen trust

26. THE LEVEL OF ANALYSIS For sure public value is a policy making tool
Anyway I consider that is still relevant as public service delivery
I think it is important to frame the concept at three different levels:
Policy making
Managerial
Operations

27. BUREAUCRATIC NEW PUBLIC MODEL
COMMUNITY
POLITICAL COUNCIL (BOARDS) POLICY OBJECTIVES ADMINISTRATION (MANAGER)
ELECTION (CONSENSUS)
PUBLIC SERVICE DELIVERY

28. PUBLIC VALUE MODEL COMMUNITY POLITICAL COUNCIL (BOARDS) PUBLIC VALUE
ADMINISTRATION
(MANAGER)
ELECTION (CONSENSUS)
CO-PRODUCTION

29. VALUE IN THE PUBLIC SERVICE FRAMEWORK
Prof. Osborne’s insights suggested me some conclusive remarks.
The concept of public value in service delivery is relevant for many reasons:
Is a way to create a better power balance/sharing among four stakeholders: politicians, public managers, individual citizens, communities
Is a way to balance individual interest and community/common interest
Is a way to regenerate the representative democracy in Western countries
Is connected to new technologies perspective
Is a dimension of sharing economy
Is an intellectual challenge to promote the shift from «management as knowledge, competences and skills to do things in the right way» to «management as knowledge, competences and skills to do the right thing (value for all) in the right way»