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My first job in the APS was in 1975 and I will be leaving the APS in August 2018, having spent
most of the intervening 43 years in the public sector, primarily in four agencies (bio at
Attachment A).
I have been privileged to have a wide range of experience in my APS career, including
examples of very good practice in public administration as well as the less good. I have
worked with a range of public sector officials from other countries and am gratified to say
that the APS compares favourably in most instances – with a track record as an active mid-
sized country that is constructive and solutions-oriented in international engagements.
I would like to make a brief submission to the Review Panel to highlight some key areas for
focus in looking at ways to ensure the APS can adapt to successfully meet the challenges of
the future. The bulk of this submission deals with the issue of innovation in the public
sector and other, related issues are touched on very briefly. While I make this submission in
my capacity as an individual, my current role is Director General at IP Australia (the
Australian Patent and Trade Mark office).
I would be happy to elaborate on any of the issues raised in this submission and provide
examples if needed.
Innovation in the APS
Government activities and investments currently account for around 35% of GDP in
Australia. Moreover government activity covers critical aspects of economic and
community life – the health and education systems as well as the provision of the economic,
regulatory and physical infrastructure that underpins economic growth and community
well-being. We recognise and promote the importance of innovation as fundamental to
private sector growth and competitiveness and the same is true of the public sector. Clearly
the application of new ideas and approaches, new technologies and systems of
management - ie innovation – is essential to effectively meet the challenges faced by the
public sector and to promote Australia’s competitiveness and prosperity.
Over recent years the importance of public sector innovation has been widely
acknowledged both here and abroad. In Australia we have had numerous reports to
government and APS innovation action plans and activities supported by our APS leaders,
including the Secretaries Board. These have generally emphasised the importance and the
benefits of innovation to the public sector and sought to identify and encourage the means
to achieve it.
Most studies agree that innovation in the public sector in Australia does take place relatively
broadly, despite some significant barriers. However, arguably the innovative capacity of the
public sector could be enhanced if it took a more systematic and strategic approach to
embedding innovation in its day to day work. Despite some notable successes, innovation in
the APS is still often undertaken on a somewhat ad-hoc basis. This may not be good enough
in a context where innovation is recognised as a powerful influence on productivity and
organisational performance – and in the context of the public sector, where it can also
impact on national performance.
The traditional bureaucratic model often stifled innovative approaches through: inherent
conservatism; rigid and opaque processes and structures that bred a culture of conformity
(and punished non-conformity); a closed, internal focus which assumed all answers must
come from within; strong risk aversion; and tight control of employees and their work
content and structure.
More recent changes to the mode of operation of the public sector have seen greater
openness, an acceptance that ideas and services are not always sourced from within and
that collaboration and co-creation, which can bring a diversity of experience and ideas to
bear, can deliver better outcomes. In some areas we have seen a greater level of autonomy
and control for staff over their work and recognition that flatter structures and devolved
decision-making can drive improved performance. Encouragement and reward for creativity
and risk taking is growing.
Resource pressures on the APS can have a variety of impacts. Resources cuts can stimulate
innovation by requiring us to rethink how we can achieve the outcome with fewer inputs.
Conversely in some cases innovation will require an investment of resources and can be
strangled if none are made available. Most sizable private sector entities budget for
research and development and have forward R&D plans. This kind of overt R&D
(innovation) budgeting and planning has been rare in the public sector and is only now
taking root in some agencies.
Support for innovation (more generally and in the public sector) has varied in strength in
Australia over recent years. There is certainly a perception, both in the APS and the public
more broadly, that innovation can be highly disruptive and lead to job losses in some
sectors. Our own staff, as well as the public, are often suspicious of, and resistant to,
innovative change and strong leadership and good communication are required to
effectively implement it.
However there are some good reasons to expect governments of all political persuasions to
generally support public sector innovation as we move forward, because they recognise it is
necessary to deliver on government goals and to create public services fit for the future.
The APS now faces increasingly complex policy issues, played out in the context of a global
rather than a local environment. Citizen expectations of public service quality have risen
while at the same time there are growing pressures on public budgets for increased
efficiency, productivity and cost reductions. There is also increasing contestability in the
provision of public services and even for policy advice.
We clearly need new thinking, new approaches and the implementation of new models if
we are to keep pace with both community and government expectations. Maintaining
limits on the size and the cost of the APS, while meeting expectations, will require new
structural and organisational models and a more open approach to working with and
through third parties.
Arguably these demands require a different approach and skill set from the past, one with
more focus on skills such as relationship building, capacity building, collaboration, strategic
forward planning, initiative, considered risk-taking and dispute resolution as well as
technical skills related to data, analysis and technology management.
Not only has there been change in the nature of our work in the APS over recent decades,
but also change in the nature of our workforce. We are now a more professionalised
workforce employing many more graduates, with much of the frontline customer service
work now outsourced or privatised. Such a workforce – better educated, taught to analyse
and to question and with a greater focus on seeking engagement and satisfaction from their
work – also demands different leadership and management approaches.
We now require more inclusive and collaborative approaches, that can engage our highly
skilled employees and that demand initiative and performance rather than conformity from
staff.
Clearly there are some inherent characteristics of the public sector that will always present
barriers to innovation. Our roles require a high degree of public accountability and thus
working within a sometimes restrictive, rules-based framework is inevitable. Our
stewardship of critical public sector services and activities rightly attracts close scrutiny by
the Parliament, the media and the public and we operate to serve ministers in a political
environment. Tolerance for risk and failure is limited. Undertaking innovation in the APS
has been described as ‘long on risk and short on reward’, and it is one of the challenges of
APS leadership to balance these factors and to make sure that there is room for, and indeed
a systematic approach to, innovative forward thinking and approaches.
It is also the case that other public sector characteristics may increasingly mitigate in favour
of innovation. It is argued, for example, that creativity is more likely to occur in jobs where
there are ‘complicated, ill defined problems requiring innovative solutions’. Such work
requires expertise and often collaboration. It requires a highly skilled and motivated
workforce able to explore alternative ideas under ambiguous conditions. Arguably both the
type of work the public sector is increasingly required to perform and the type of people
that increasingly make up our workforce predispose us to greater levels of innovation.
What can we do to promote APS innovation
APS leaders do not have to be the organisation’s chief innovators. Rather, our role is to
create the framework conditions for innovation to flourish within the organisation.
Sometimes this can mean recognising you can’t lead the necessary change and empowering
others who have the capacity to do so.
It is likely to mean taking some risks, expecting some failures, but being prepared to
persevere and follow through, [ie not lose enthusiasm when problems or failures arise.] and
also to be prepared to defend the value of innovative activities, even where they fail. There
is usually resistance to doing things differently and it will often require considerable
persuasion, persistence and determination by the leadership to affect change.
I would nominate five key behaviours we need to broadly adopt across the APS to enable
innovation.
Open leadership behaviours: Adopt outward-looking strategies based on an acceptance
that ideas and services will not always be sourced from within. Cast a wide net for ideas and
talent and utilise them effectively. Adopt a collaborative, open and inclusive style,
encompassing a mix of internal and external input.
A supportive environment and culture: Do APS staff see their leaders as having a
reasonable risk appetite, as rewarding innovation and tolerating some inevitable failures?
Leadership behaviour sets the culture more than any other single factor and can provide
employees with the permission and the means to develop and try out new ideas.
Establishing a bottom-up capacity to generate and capture ideas as well as a top-down
approach and encouraging diversity and openness to new ideas can help build an innovative
culture. Flatter structures and organisational approaches that devolve decision-making and
push responsibility down the chain will also support an innovative culture.
Build innovative capacity – Does the APS workforce have the skills, technology and
resources required to develop and apply innovative approaches and to work with other
parties on these issues? There are some great examples now of effective public sector
innovation, and experience is growing, however the APS would benefit from taking steps to
develop the relevant skills among APS staff and signal it values these skills.
Develop a systematic approach to innovation – as noted earlier, too often public sector
innovation happens on an ad-hoc basis. A more systematic approach would require giving a
clear mandate for innovation within APS organisations; including it within planning
frameworks; having a system for capturing and implementing ideas from within APS
organisations; and also having a strategic approach to partnerships and collaboration to
capture external ideas. Building a systematic approach to developing, applying and
evaluating innovative approaches and ideas is key.
Measure and reward it – To promote innovation staff need to understand that it is valued
within the organisation. Inclusion of innovation in strategic and operational plans and in
performance agreements ensures there is a clear focus on it as an organisational goal and
also requires measurement or assessment of whether it is being achieved.
It is important to reward and celebrate innovation successes. This reinforces the message
and helps establish a culture supportive of innovation.
Conclusion
While rates of progress may vary I think ultimately what governments and the public want
from the APS requires us to adopt operating models that foster innovative ideas and
approaches. As public sector leaders we need to adapt our approaches to address that
reality.
Other Key Points
Policy development and advice
While a focus on serving the government of the day and meeting ministerial demands is, of
course, essential, this focus on responsiveness should not be to the detriment of proactive
policy thinking and planning. There is a dearth of long-term thinking and planning in many
APS departments which is not serving ministers/governments or the pubic well. Time and
resources need to be made available for pro-active (not just responsive) policy development
and long term thinking and planning. This should be articulated as a clear responsibility of
the APS. Particularly in times of political turbulence and frequent changes of government
and/or ministers the APS is the only body in a position to effectively undertake this.
Evidence/Data
We live in the age of big data. In many areas the data and evidence on which to base policy
development has never been so good and continues to improve as the number and quality
of linked data sets and our ability to analyse them increase. This will also allow much more
effective evaluation of government programs and services.
Improving the quality and availability of government data, building the capacity of APS staff
to effectively utilise it and, wherever possible, making it publicly available, is a great
investment in good government.
Agility
In an environment of fast-paced change (particularly technology-driven) there is a
recognition that the APS needs to become more agile in the way it works. There is
however an inherent bias against agility in the way the APS operates. New ideas or
approaches, particularly those that may be disruptive, are often smothered in excessive
process which, at best, slows them down and, at worst, prevents them being explored or
adopted. This also erodes the energy and enthusiasm of staff seeking to champion
innovative approaches.
Communications
Introduction of new policies or approaches (particularly if they may be disruptive) is often
not accompanied by a comprehensive and effective change management strategy. Selling
the idea or change to the public has to be part of the package if that change is to be
successful. [The same applies to getting APS staff themselves to embrace change.]
The value of effective communication and change management seems to be
underestimated in the APS and the resources devoted to it are often inadequate. However
taking the public with you when you are seeking to make changes or do things differently is
key to developing public trust. This area of effective communications/change management
should be a focus for improving APS performance.
Management of Technology (ICT)
It is said that every company today is a technology company and I think this is also true of
government agencies. The extent to which we can do our job well and serve the public relies
fundamentally on our access to appropriate technology and our ability to utilise it in the
most effective way. Technology development is also moving fast, requiring us to constantly
assess technology trends, developments, opportunities and risks as we look at making
(often large) investments with public money.
However APS leaders are frequently not well equipped to make good decisions or effectively
manage big technology programs (often also true in the private sector). Building the
capacity of APS decision-makers and leaders to run large, technology-based enterprises
should be an area of focus for capability development.
Consultation, Collaboration and Openness
Consultation, Collaboration and Openness in the way we operate has to be our default
position. While we have come some way along this path, there is still work to do. We need
less defensiveness and more true openness to outside views and input in the APS. We also
need to get better at real consultation and working constructively with third parties
Workforce/People/Skills
There has been a huge ‘professionalisation’ of the APS in the time I have worked in it. The
quality of recruits – and in fact the overall quality of APS staff - has probably never been
higher. Anyone who deals with graduate recruitment cannot fail to be impressed with the
quality and enthusiasm of young people joining the APS. How we develop and keep these
great staff is worthy of close consideration by the APS Review.
A generous APS superannuation scheme was once a key element in attracting and retaining
staff, but no longer. My experience suggests two key elements in attracting and retaining
staff: The nature of the work, interest in the opportunities it can present and a conviction
that the work is important and makes a difference, and; Attractive working conditions,
including access to flexible working arrangements and development opportunities. Staff
satisfaction and performance is also promoted by a level of autonomy and control over their
work which can be enhanced through flatter structures and more devolved decision-making.
ATTACHMENT A
PATRICIA KELLY PSM
DIRECTOR GENERAL
IPAUSTRALIA
Prior to joining IP Australia in 2013, Patricia Kelly was a Deputy Secretary in Commonwealth
departments responsible for industry and innovation from 2004-2013. Patricia has had a
public sector career spanning over thirty years. Her experience in other portfolios includes
the Department of Social Security and the Department of the Prime Minister and Cabinet.
Patricia has served on a range of boards and committees, including the Advisory Council on
Intellectual Property (2004-2009) and the Co-operative Research Centres Committee (2004-
2013). She chaired her department’s Audit Committee from 2006-2013. She was a member
of the Council of the University of Technology Sydney (2006-2008), a member of the Review
Panel of the National Innovation System (2008) and chaired the Management Advisory
Committee Steering Committee to report on innovation in the Australian Public Service
(2008-2009).
From 2007 Patricia worked closely with the research and higher education sector. She led
Australia’s bid to host the Square Kilometre Array (SKA) radio telescope and represented
Australia on the Board of the International SKA Organisation between 2012 and 2017. She
was awarded the Australian Public Service Medal in 2013 in acknowledgement of her efforts
to secure Australia’s bid to host the SKA and to promote public sector innovation.
Patricia represents Australia at the General Assemblies of the World Intellectual Property
Organization and serves as chair of Group B+ (the group of around 40 developed nations).
She is a member of the Executive Board of the Department of Industry Innovation and
Science (DIIS).
Patricia has a Bachelor of Arts degree, with a major in communication and is a graduate of
the Australian Institute of Company Directors.