Should the APS favour system stewardship over outsourcing?


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The Australian Public Service must embrace the idea of strategic commissioning, according to Professor of Public Management, Janine O’Flynn.

In a new academic paper, O’Flynn — who has two decades of research experience in the area — explains strategic commissioning is “much more than deciding who will do what services”. Rather, it looks at community needs.

“The APS needs to think of itself as the designer of a much more complicated system, as ‘system stewards’ of a broader set of relationships,” she told ANZSOG.

But there are some barriers to moving towards this approach, O’Flynn said. This includes the organisational culture within the APS and regulations, such as procurement rules.

“There is a risk aversion that has developed in the APS, with high levels of monitoring, very highly specified contracts, and part of that is around trying to make sure there are no catastrophic failures,” she said.

“All of these push us in particular ways, and can be reinforcing.”


READ MORE: Commissioning public services: the definition and aims matter


She argued that governments could become caught up in mindsets that influence them to design particular types of contracts and governance structures.

“The obsession with a particular tool – outsourcing – rather than a much broader toolkit of relational forms means that we are not seeing the sort of strategic stewarding of complex systems that is needed in practice.”

“There are exceptions, but the APS has tended to default to a transactional approach to working with others.”

“We argue that we need to get a bit more relational for some, not all, of these contracts and think of them as long-term relationships that need to be nurtured. We may not be able to have competitive markets for some things, we may not be able to set down on contracts that set out every possibility.”

The article, in the journal Policy Design and Practice, observes:

“Adopting broader notions of relationships is important in moving beyond a fixation on tools. Such a shift in mindset, however, demands new ways of thinking about the various parties, relationships, and modes of working together. In turn, this would require very different sets of capabilities to effectively work together.”

O’Flynn has disagreed with those who say the APS has a “massive capacity gap”. Capacity building is important, but thinking about organisational capabilities and designing enabling environments is also important, she said.

“Shifting mindsets is hard work,” she noted.

“We need to continue our work in building these connections, in laying out this complexity and providing ways in which we can map out new ideas that help us in the practice of governing.

When we look at how the work of government is actually done, we see this complexity clearly, but we continue to design systems, processes and relationships that seek uniformity, and which narrow our ability to deliver on the needs and aspirations of citizens and communities. We need new building blocks to guide us.”

O’Flynn and Professor Gary Sturgess explored new forms of contracting in their research paper for the APS review panel.

“The APS must transition towards system design and stewardship and mature beyond the current mindset (where the focus in on transfers, grants and procurement),” they said.

“This recognises the current reality of the complex interwoven system where government works with a variety of different systems and actors. These systems need a form of stewardship that goes beyond attempts to create and shape markets, to stewardship that recognises the nature of systems government is dealing with.

“The reality is that connections exist between departments or agencies, across federal-state boundaries, and across public-private boundaries.”

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