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We must allow the risk of failure

Glyn Gaskarth says innovation in public services means accepting risks.

6a00d83451b31c69e20120a8c1ed2f970b-150wiThe Royal Society for Arts (RSA) recently initiated a project entitled The Glory of Failure.  The group included representatives of local government. One can imagine press officers for the relevant councils shaking their heads while checking the wanted advertisements in despair. The branding was questionable but the RSA have raised an important issue – is initial failure the price of eventual success?

This issue is more delicately dealt with in Adapt: Why success always starts with failure by Tim Harford. It makes a powerful case for allowing some failure as the price of success. We need to allow experimentation to make progress. This will result in some failures but the key is to design the process to allow controlled experimentation so failure is manageable and survivable.

Clearly failure is not to be celebrated. The process needs to be managed with lessons learnt. This should not be a get out of jail free card for local authorities that show no signs of improvement. Instead we need to redesign the way we provide public services to allow experimentation and accept (not celebrate) the fact this will lead to some service providers failing.

We should allow public service lines to be spun out of council control. These entities could become mutuals or social enterprises or limited companies. This will allow them to experiment with new means of delivering services. There should be no expectation that every one of these businesses will survive and prosper.

If services are to improve some of these companies must be allowed to fail. Alternative providers can be commissioned to take their place. The free market does not work well because every company is better than the public sector and works effectively. It works because the inefficient suppliers are continually allowed to fail and the companies that dominate are constantly under pressure to retain their position. Today’s winners can become tomorrow’s losers if they don’t innovate.

We need to break free from the mind-set where people would rather fail in the conventional way than to try to succeed through experimentation and risk failing in an unconventional way. In the private sector the phrase was ‘no one was ever fired for buying IBM’ and in local authorities few people have been put on gardening leave for keeping public services in house and moaning about spending cuts.

Adapt features a simple experiment which shows the value in experimentation and challenging accepted wisdom. Many years back, Archie Cochrane conducted a test to see if coronary care units in hospitals were better for patients than recuperating at home. He met with medical practitioners to discuss the results. He presented to them evidence that home care was more dangerous and was leading to more deaths. Their response was telling:

“Archie”, they said “we always thought you were unethical. You must stop the trial at once…” Archie Cochrane recalled. ‘I let them have their say for some time.’ Then Cochrane revealed that he had reversed the statistics. It was the coronary care units that were showing signs of being more dangerous, and the home care that was starting to look safer. Would the coronary consultants now clamour for their own units immediately to be closed? ‘There was dead silence.’

It would be easy to blame this approach on a public sector mentality which prioritises safeguarding its wages and position rather than serving UK citizens. This is partly the case. But I also think that in many other cases it is more that people compare proposals for change with their ideal of how the service should operate. They do not compare the proposals for change with the reality of how the service currently operates. This is true even when the way the current service is run does not come close to achieving that ideal.

An example is the school system. We have a very socially stratified school system. Most British parents pay for their children’s education through private commercial arrangements. The rich pay for private schooling directly by paying for their child to go to Eton etc. The middle class pay an inflated house price to live in an area with a good school so their child can attend the 'local school.' The fact some parents choose to pay through a house price rather than a direct fee does not confer any moral superiority. In contrast, poor people live in poor areas where their local school is often underperforming. Yet anti free school campaigners often criticise free schools by charging that they will lead to social stratification as though our current system did not deliver massively different results for rich and poor parents.

No political party can guarantee that every school will be excellent and that all hospitals will deliver the same level of service. Politicians who attempt to do this are either ignorant or snake oil salesmen. Our education and health systems are built on national structures which claim to deliver on these false promises. We should not view public service reform through this perspective. Instead we should  start with a realistic assessment of what we have and ask how we can improve it.

We should be happy to see incremental improvement in UK public services. This will happen when services are spun out from local authority and central government control and allowed to experiment with new ways of delivering their services. Some of these companies, mutuals and social enterprises will fail. Their failure will help the sector to make progress. This will drive up standards of service provision and benefit us all. This approach is better than the current system that pretends to enshrine universal standards but which actually delivers a poor service to our poorer citizens.


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