Monday, February 4, 2013

Lean in the UK Public Sector

Sometimes, as we venture from the realm of business to public service there can be significant push back to efforts for change and increased efficiency. There is a battle between data driven analysts and on-the-ground practitioners. But when millions of clients depend on these non-profit and public agencies, adopting lean practices can be the difference between serving those in need and falling short of the mission.

So we have to ask ourselves,

When do lean business innovations work in the public sector?

Fresh ideas for Britain's largest public service agency

The Department of Work and Pensions provides welfare, pension, and child poverty support to more than 20 million people in the United Kingdom.  For them, the leanest business innovation turned out to be capitalizing on the reservoir of human capital already at hand in their 120,000 employees. [1]

It was called Idea Street and in just one year it saved over 20 million pounds.

The agency instituted an idea management system and invited all employees to contribute. Although just 1.4% of ideas contributed were implemented, the average savings to the agency per idea was over 317 thousand pounds. But it didn't stop there. The agency, recognizing the value of insight from workers on the front line, further empowered empowered their workforce to participate in the implementation of their own ideas.

As of January 2013, the Idea Street system, initiated as part of DWP's 2011-2012 Capability Action Plan, had been adopted by two other UK government agencies. [2]

"Square peg, round hole"?

In this paper Murphy and Simpson explore the notion of "adopting" versus "adapting" lean business and manufacturing practices to the public sector, acknowledging concerns are raised that the efforts for efficiency reduce the skill of workers to mechanized actors. Pair analyze three case studies and conclude that Lean policies do work for increasing process efficiency, but fall short when it comes to improving customer service and changing organizational structure. [3]


Does this set an endpoint for the utility of Lean practices in the public sector? Or did Idea Street achieve the kind of embedded organizational success that Murphy and Simpson thought unlikely?


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