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Governance as a Continuous Learning Process?

Erik Arnold

24 May 2006

www.technopolis-group.com

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Road map and acknowledgements

• A worry • What is governance and why does it matter?• What goes wrong?• Factors in designing governance systems• Sweden: how not to do it?• European Commission: changing the rules?• Some tentative conclusions

• Thanks to: EZ, RCN, BMVIT, NMR, ECA, CEC, NSTDA (Thailand), Foreign Ministry of Denmark, Teknisk Framsyn

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Can we talk about ‘learning’ in systems as irrational as research and innovation governance?

• Politics at the expense of policy

• The power of personalities in determining outcomes

• Limited connection between policy and an evidence base

• Politicisation of evidence

• Personnel policy as an instrument of political control

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Governance - the action or manner of governing - is firmly onto the policy agenda

• The nature of the ‘social contract’ between science and society continues to shift, with society demanding that science be relevant to its needs, making it natural that there be increased extra-scientific involvement in the governance of research

• The continuing spread of the so-called New Public Management among administrations provides a more general impetus towards transparency and efficiency in the use of taxpayers’ money to achieve social goals, in innovation and research policy as elsewhere

• Shifts in the way knowledge is produced and used imply a need to bring together different knowledges and knowledge producers, both across disciplines and between fundamental and applied work

• Theory increasingly emphasises the systemic nature of research and innovation in economic and social development, tying more closely together the performance and management of research and innovation with the levels of policy and politics

• Whereas research and innovation still is predominantly a national policy responsibility, international and regional actors are claiming a larger role in the whole policy cycle, thus asking for a change in the rules of the game

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Traditionally, we see governance as being about control

Roles of governance

• Agenda setting: deciding the scope of actions the state and the publicly funded actors in innovation and research should take

• Prioritisation: deciding which of these actions are most necessary in the context of scarce government resources

• Ensuring effective implementation of the actions taken

• Learning and adapting to change

Governance as a control system

Governance

Research and

Innovation Policy Delivery System

OutIn

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How does the governance system learn?

• Building institutions

• Evolving organisation, routines and processes

• Organisational memory (and organisational forgetting)

• Developing strategic intelligence

• Evaluation

• Theory building

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In studying research and innovation governance, we technocrats typically think in terms of four levels, and slide over the politics

R&D Institutes

Parliament

Government Policy council

Ministry of Education

Research Councils and Academies

Universities

Other Sectoral Ministries

Producers: Firms, farms,

hospitals, etc

Ministry of Industry

Technology & Innovation Agencies

Support Programme Agencies

Programme Contractors

Instructions, resourcesAdviceResultsHorizontal co-ordination and integration

Level 1High-level cross-cutting policy

Level 2Ministry mission-centred co-ordination

Level 3 Detailed policy development, co-ordination

Level 4Research and innovation performers

Key

Source: Erik Arnold and Martin Bell

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We do policy tourism and tell each other the Finnish model is best

Science and Technology

Policy Council

Parliament

Government

Ministry of

Education

Ministry of Trade and Industry

Other ministries

Academy of Finland

Technology Development Centre (Tekes)

Universities(20)

Polytechnics(29)

State Research Institutes, e.g.

Technical Research Centre (VTT)

Languages of FinlandForest Research InstituteNational Public Health

InstituteMeteorological Institute

Ministry of

Agriculture &

Forestry

Ministry of Social

Affairs and Health

Finnish National Fund

for R&D(SITRA)

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In fact, innovation/research governance is liable to many failures

Structural issues

• Contested nature of the social contract - disagreement about who’s in charge

• Sectoral principle and organisation• Few convincing positive examples

• Integrated approaches• Change agencies

• Planning: ‘law of the missing middle’• Radical change cannot always be

tackled within the structures• Slow response-times

Capture of principal-agent systems by client communities

Research Community

Education Ministry

Research Council

Industry Ministry

Innovation Agency

Industrial Community

See Dietmar Braun, ‘Who governs intermediary agencies? Principal-agent relations in research policy making,’ Journal of Public Policy, 13 (2), 1993, pp135 – 162

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Strategic intelligence is one of the keys to making the system work

• Doing the work needed to gain a descriptive understanding of relevant features of the research and innovation system, in order to provide an evidence base for policy making

• Diagnosing problems or bottlenecks in that system, understanding changes and identifying opportunities to improve its performance

• Anticipating the effects of interventions and setting objectives for improvement

• Designing policies, programmes and instruments with the aim of making these improvements

• Obtaining feedback about present and past interventions, thereby learning how to improve future actions

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Where you put strategic intelligence relates to who drives policy

Policy design

Programme design

Programme management

Programme administration

Ca UK SF Ei S NNL

KTM

CFI

EZ

DTI

Sta

te

Pri

vat

e

DfE

Forfás

ND

ND

TEK

ES

EI,

SFI VIN

NOV

A

RCN

VTU

FIS

DK

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Politik Design

Programm Design

Programm Management

Programm Abwicklung

FFFFWF

ASA BIT

AWS

BMVIT BMWA BMBWK BMF BMx

Rat Interessensgruppen

Regierung, Parlament

Länder EU

FFF TIGSchirm-Managements

In real life it can be chaotic (Austria, 2003)

Source: Dorothea Sturn, FFG

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In addition to vertical steering, horizontal co-ordination is needed

• Compartmentalisation between research and innovation and between sectors is a significant obstacle to a more integrative approach to research and innovation

• Some societal issues are too big to address from one sectoral perspective only

• The creation of separate relatively closed departmental research and innovation networks means government receives poor quality advice

• From the perspective of the user (industry, research ) a large diversity of R&D support mechanisms hinders transparency

• A growing number of knowledge and policy challenges appear to span multiple sectoral responsibilities.

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Evaluation is one of the sources of evidence needed for learning. But you need evidence before policy, not afterwards

Design Implementation Impact

Design Implementation Impact

Standard mode

Meta-analysis/synthesisStart

StopStart

Stop

Source: Ray Pawson, ‘Evidence-based policy: In search of a method,’Evaluation 8(2), 2002

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Sweden: a case of arrested development?

Agricu ltu re

Parliam en t

Governm ent Cabinet Off ice(Re geringskansl iet)

For sknings be redningenEduca tion M inist er

Ministry ofthe

Environme nt

Ministry ofHealth &

Soc ial Aff airs

Ministry ofEducation &

Science

Ministry of Industry , Employment & Comm unications

FORM ASRes ear ch

Council forEnvironme nt,

Spa tia lPlanningandAgricu ltu ra l

Science s

FASRes ear ch

Council forW orking Li fe

and SocialScience s

Swe dishRes ear chCouncil :

HSFRMFRNFR

EducationCommitt ee

VIN NOVASwe dish

Agency f orInnova tio n

Sys tems

NU TE KSwe dish

Agency f orIndustrial

Deve lopmen t(includes

ALM Iholding

company)

ITPSSwe dish

Institu te forGrowthPolicyStudies

Univer sities (13) Colle ge s (24) plus sp ecialistcoll eg es (1 3)

Applied Research Insti tutes ( 32)

Res ear ch F orum

W age Ear nerFund

FoundationsSSF,

MIS TR A,KK , Vårda l,STI NT, RJ*TechnologyBridges ( 7)

Opera tin gagencies eg

STEM ,Roads and

RailAdministrat-ions, Swedish

EPA

PrivateFoundations,

egW allenberg ,

Nobel,Cancerfo nden, Craf oord,Hasse lb lad,

etc

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“We have politics but no policy” (Industry ministry official)Some consequences

• Agency-driven policies, with policy competition

• Teknisk Framsyn 2 essentially had no audience

• Lowest Research Institute funding in the OECD. No clear future

• Knowledge Foundation tries to develop research capabilities in regional universities, in the absence of complementary instruments

• 30 years of long-term energy research, focusing increasingly on fundamental research and unable to spend the implementation budget

• Continuing (and increasing) fragmentation of the academic system, both within and between universities

• Innovative Sweden - light at the end of the tunnel? Another train?

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Time to ditch Axel Oxenstierna?

• The traditional model of ‘thin’ ministries with limited strategic intelligence struggles to cope with modern reality

• The Swedish research and innovation governance and funding system is fragmented

• It lacks effective change-agency and suffers from lock-ins

• Horizontal coordination is poor

• Is it time for a national debate that goes beyond the box-shuffling exercise of 2000?

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In contrast, the Commission is innovating in governance through coordination instruments and building ‘intelligent agents’

Level FP6 FP7 Policy/Ministry Open Method of Coordination

CREST R&D Policy Actions RTD-OMC-NET Trend Chart on Innovation

Open Method of Coordination CREST R&D Policy Actions RTD-OMC-NET Trend Chart on Innovation ERAWATCH

Programme/Agency ERA-NET Article 169

ERA-NET+ Technology Platforms* Article 169

Project/Performer New Instruments New Instruments Technology Platforms*

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The essence of Commission strategy for opening R&D borders is thus to redefine governance

• To operate simultaneously at policy, agency and research performer levels

• To use variable geometry as a device to bypass objections and objectors

• To build constituencies bottom up around needs and problems in the research and innovation system, which are likely both to produce valid grounds for intervention and to act as lobby groups for cross-border action

• To devolve at least some of the new administrative burdens created to the beneficiaries

• As a result, to shift power from the member states to Brussels

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We can generalise a little about what works in governance

• One or more arenas are required, in which policy can be negotiated

• Strategic intelligence needs to be distributed in order to be effective. (What you can see depends partly on where you stand)

• Intelligence needs to be vertically as well as horizontally distributed

• A measure of continuity is needed in policy, institutions and people

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In Europe, at least, it looks as if we will have to learn to develop governance systems that embody network intelligence

Governance

Research and

Innovation Policy Delivery System

OutIn