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Become More Innovative

Innovation and adaptability are essential for adjusting to changes in the financial environment. Lack of adaptive behavior hastens decline in an environment of financial distress. Innovation is essential to finding ways to delivery services for less money.  Governments should be conscious of developing a process that generates new ideas and sees them through to successful implementation and diffusion to the entire organization.
  • Make innovation a discipline. Innovation is a discipline just like strategic planning or budgeting. As such, you need to develop in your organization an innovation process and lifecycle. The cycle starts with idea generation – coming up with new ideas to improve performance or to reduce costs. After ideas are generated you need to select the best one. Once selected an idea needs to be refined and executed. Often, it is helpful to execute an idea as a pilot or demonstration project. This shows that the idea can be successful and that benefits accrue to those that try something new. Finally, the idea should be replicated and spread throughout the organization. The documents below discuss the discipline and process of innovation in more detail, as well as how to structure your organization to support innovation. Best Resources:
  • Increase your innovation capacity. Three factors appear to be crucial for enhancing the innovation capacity of local government: leadership credibility, team management, and a well-functioning governing board. Evidence indicates that local governments that practice and emphasize these factors innovate more often and more effectively. These factors reduce the risk associated with bringing up new ideas and create a more supportive environment for trying new things. Leadership skills can be learned, teamwork enhanced, and steps taken to help board members work better together and with staff. The document below describes these factors in more detail and how they support innovation capacity. Best Resources:
  • Create funding for innovation. You often have to spend money to save money. Develop methods to fund innovations that will save money. Options include:
    • Provide flexibility to managers to reallocate funds across budgets. However, have mechanisms to define and assign accountability for spending results.
    • Create an innovation fund. An innovation fund is like a revolving loan fund where the savings from innovations repay the fund.
    • Provide savings incentives. If departments can keep part of the savings from successful innovations, innovations will be more likely.

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