Creating%20pseudo%20markets%20and%20incentive%20structures%20for%20public%20sector%20innovation:%20Diabetes%20education%20policy%20in%20the%20UK

1
Creating pseudo markets and incentive structures
for public sector innovation Diabetes education
policy in the UK

• Paul Windrum
• (Manchester Metropolitan University)
• e-mail p.windrum_at_mmu.ac.uk
• Presented at Policy workshop on innovation in
  the public sector, Brussels, 2nd December 2005

2

• Background Stylised facts
• No data to show public sector doesnt innovate
• Elements of public sector always were highly
  innovative
• Linear model of university science technology
• - Medical breakthroughs
• 1980s change in rhetoric in favour of private
  sector

3

• Stylised facts cont.
• Upshot for public sector
• Outsourcing / competitive tendering of basic
  services
• Adoption of management practices (New Public
  Management)
• Public-private initiatives

4

• Beyond Rhetoric
• Increasing Executive dominance (Mitchell, 2001)
• Tools for this
• Directives targets based on national standards
  set by Executive
• Shift of power to the centre while transferring
  responsibility to local practitioners

5

• Problem No room for radical innovation!
• Innovative systems are not in equilibrium
• Lean means orgs have no incentive or resources
  for innovation
• Asymmetric information between Principle
  (Executive) and Agent (practitioner)
• Danger of lock-in to suboptimal solutions when
  there is no innovation and experimentation at
  local level
• A new way forward?
• (Borne out of necessity)

6

• Focus
• Factors that stimulate shape service
  innovations (lead to new variety)
• Selection criteria that determine what service
  innovations will be taken up and diffuse

7

• Driving Factors Crisis situation
• Increasing prevalence of chronic illnesses
• 1.5 million diabetes patients
• plus 1 million missing patients
• Costs to NHS
• Fundamental trade-off cost vs quality of service

8

• Patient-orientated education
• Underpinning concepts
• Consumerisation
• Patient empowerment
• But far from clear what patient-orientated
  education actually is in practice

9

• Solution Policy innovation
• New alternative to de jure public and de facto
  market standards processes.
• Encourage local experiments at local level
• Then define standards (enacted as national
  Directives for diabetes education)

10
Figure 1. Policy Innovation creating a pseudo
market for innovation
11
(No Transcript)
12
Service Level Innovation

• Key extensive scoping exercise
• Patients medical practitioners
• Review of other diabetes education projects
• Variety of approaches according to
• How concepts of patient empowerment and
  consumerisation are understood and implemented
• Deal with the fundamental trade-off between cost
  and patient quality

13
Service Level Innovation

• Objectives
• Improve Efficiency
• Increase Speed
• Improve Take-up
• Improve the Learning Experience

14

• Improve efficiency
• Increase amount of knowledge imparted to patients
  in a given time period or
• Reduce total face-to-face contact time /or
• reduce hours/trips of individual staff to impart
  the same amount of knowledge
• Increase Speed
• Shorten the period of time between diagnosis and
  the learning process /or
• Accelerate the learning process

15

• Improve take-up
• Increase the total number of referrals that
  attend the education sessions
• Increase the percentage of particular types of
  patients that attend (e.g. males)
• Improve the learning experience
• Patients take ownership
• Opportunities and scope for individualism

16
Content of programme

1. What is Diabetes (Type 2)?
2. Diet
3. Medication
4. Special issues e.g. feet, eyes

17
(No Transcript)
18
Findings

• Innovation definitely exists in the public sector
• It relates to innovation activity in the private
  sector but has its own dynamics and its own
  innovations which are generated in public
  sector institutions
• Objects produced in public and private sectors
  differ, and public sector environment typically
  contains more stakeholders BUT the basic
  cognitive and practical inputs are the same
  i.e. human learning and creativity

19
Findings cont.

• Conceptual innovations cut across policy and
  service levels development of new world views.
• Structural/organisational innovations
  (contracting out and beyond)
• Due to policy learning
• Due to conceptual perspectives changing (what
  public sector should do, how and where)

20
Findings cont.

• Policy innovation new ways of setting standards
  to traditional de jure public and de facto market
  standards formation
• Creation of pseudo market for radical innovation
• BUT closure likely to lead to longer-term
  problem sub-optimal solution lock-in
• Need to maintain variety in the long-term
• - flexibility how to meet diversity of local
  needs amongst highly heterogeneous population

21
Findings cont.

• Selection environment for innovations
• importance of social responsibility and
  accountability typically higher than in private
  sector
• key stakeholders shape the innovation process
  Govt depts., NGOs, NHS practitioners, and
  patients
• As important as the character/interests of the
  individual stakeholders is how they interact with
  one another, and their power to shape the
  innovation
• This determines how the fundamental trade-off
  between service quality and costs are treated

22
And finally

• Will the standards ultimately work?
• Need to encourage local innovators (champions)
  keep standards process open!
• Patient-orientated education underpinned by 2
  key concepts
• Patient empowerment
• Consumerisation
• These pull in opposite directions!

23
And finally

• Will the standards ultimately work? Cont.
• Patient response
• Patient-orientated education only dealing with
  part of the picture,
• i.e. first knowledge then behaviour change
• Difficulties lie in altering habits and habitus
• Skills/ competences to enact the new standards /
  directives on the ground
• changes in basic training of nurses doctors