After many years of inquiry and, to be honest, some approaches that failed to deliver, the Royal Society for the Encouragement of Arts, Manufactures and Commerce has come up with an injunction that sums up our approach to change: ‘think like a system, act like an entrepreneur’.
We’re finding it is an easy idea to understand; the challenge is enabling local leaders to act on it.
When change involves getting people to alter their attitudes and behaviours, the failure rate is very high. Research shows this to be true of public policy, social innovation and organisational change. We diagnose this high and consistent failure rate as the result of two recurrent weaknesses; interventions tend to be too narrow and uncoordinated (focused on aspects of a system not the system as a whole) and too path-dependent (unable to adjust and adapt as real world implementation inevitably confounds drawing board expectations).
On 7 March the RSA will publish the findings of its Inclusive Growth Commission. Combining economic dynamism and social justice is a classic wicked issue; it is hard enough to get economic policy and social policy right, let alone successfully combining them to the benefit of citizens. Yet, as the commission argued in its interim report, unless we achieve that combination the urgent task of building places that work for all their citizens will remain intractable. I am not on the commission, which is made up of independent experts and chaired by Stephanie Flanders, but I have been thinking about what would need to happen to allow local leaders to approach inclusive growth by thinking like a system and acting like an entrepreneur.
Three major shifts would be involved. First, it would require a genuine recognition by central government that inclusive growth has to be led locally. As documents like the recent industrial strategy green paper underline, the good news is that the May government remains committed to the devolution process set in train by George Osborne. However, the bad news lies in the continued emergence of top-down initiatives of questionable value and the resistance of public service departments to genuine devolution.
An enabling central state is not simply one that lets go. It means a centre geared to supporting localities as the change-makers, for example, combining funding streams, removing regulation and bureaucracy or providing strategic advice. The mandate of national government also means retaining the power to intervene when things go wrong. Crucially, such an enabling shift is about a lot more than how parts of Whitehall interact with town halls; it would involve a fundamental recasting of the centre, its operating models and systems of accountability and culture. The move to an enabling state can be one aspect of a strategy to renew our ailing democracy.
Second, we would need to make inclusive growth the explicit goal of local leadership. This means defining inclusive growth, measuring it and being accountable for it. But, most of all, it means inspiring local public, private and third sector organisations and communities themselves to get behind a vivid and place-specific vision of towns and cities that work for all their citizens.
Third, inclusive growth needs a different kind of leadership. ‘Thinking like a system’ requires new tools, new insight and highly strategic and collaborative forms of working. ‘Acting like an entrepreneur’ means building the trust and engagement necessary for a flexible change mandate. It means a celebration of experimentation and tolerance of failure.
As a provocation, consider the world of technology investment: here, with an expectation that four out of five ventures will fail, investors look for proposals with the potential to quintuple in size and profit. Now think of political capital rather than financial capital and the idea that one role for officials and agencies is to develop ‘investment-ready’ change propositions for political leaders. The key shift in mind-set is from a traditional public policy model of change, that starts with what we might want to happen, to a focus on where there are credible opportunities for benign change, even if initially small or symbolic, that will empower citizens and create other possibilities.
Inclusive growth is an urgent necessity in itself but also if we hope to reverse the rising tide of political disenchantment and public pessimism. But it is an incredibly hard task, which is why we need to abandon business as usual, redefine our idea of success and think about change very differently everywhere from Whitehall to village hall.
Matthew Taylor, chief executive, RSA