January 25th

What’s the secret to success in public sector transformation?

What’s the secret to success in public sector transformation?

Dr. Kelly Rowe

Transforming a public sector department or organization is not easy. Significant shifts might be resisted or underfunded, or the ministry/department may simply lack the capability to implement the change. Leaders of the transformation are heroes just for stepping up to the challenge.

At a recent IPAC Annual Conference panel, we explored service transformation with government leaders and Nous CEO, Tim Orton. (You can read more here.) The panel agreed on the need for agile transformation governance, for ensuring teams delivering transformation have the right capabilities, and for gaining political buy-in in order to fund and drive the change from the top.

But in practical terms, what needs to happen for leaders to get a transformation right? And how might those needs shift before, during and after a transformation?

Success requires much more than just a program management office (PMO); it needs an authorizing environment enabled by fit-for-purpose leadership and governance across the lifecycle of the transformation. (The authorizing environment includes the formal and informal (hard and soft) authorities required to deliver on government functions.)

It also requires an agile approach, which means being in tune with the dynamism and change of the  operating environment, and less driven by process and analysis. Transformation leaders need that mindset and capability in them and around them.

We have worked with hundreds of government departments and ministries across the world to advise on, and support delivery of transformation programs. In so doing we have engaged with a great many senior public sector leaders and their stakeholders to understand the key success factors.

There are four phases of transformation

It is evident from our work with clients in Canada and abroad that there are four phases of a transformation, each with its own objectives and focus, and each requiring distinct governance and capabilities:

1.     Setting and agreeing on the approach

2.     Launching the transformation

3.     Steady state of transformation delivery

4.     Program wind down and continuous improvement

To illustrate these phases, we will use a six-year transformation scenario: A large government department with a service delivery mandate needs to re-orient its operating model to become more service-focused, enabled by digital tools, agile in the way it operates and staffed with the right capabilities.

We will look at the scenario from the perspective of the leader who will be accountable for the transformation (such as a deputy minister), identifying the questions the leader should be able to answer from key stakeholders (and from themself).

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1.     Setting and agreeing on the approach (Year 0)

Your minister, secretary of cabinet and colleagues will ask: Why this and why now?

This pre-transformation phase requires confirming and making the case for change. At this time the funding needs to be secured, so it must be clear the investment will be worth it and the desired outcomes and (potentially) savings will be realized through the transformation. This can take the form of a clear and comprehensive business case that addresses the key drivers of the change (such as an inability to deliver business outcomes or low client satisfaction). The benefits of the proposed change should therefore be transformative as they address multiple aspects of the operating model.

Articulating the transformation approach is also important. The approach should include the overarching objective and desired future state, the key focus areas of change, the mechanism for the transformation to unfold over time, critical dependencies (such as technology implementation) and milestones.

The decision-makers around the table at this stage need to be those who understand the potential impacts and outcomes, who hold the purse-strings and who know the organization well enough to define its strategic approach, considering the organizational requirements and operating environment.

This is NOT the time to bring several deputy ministers along to weigh in – think lean and purposeful to develop the case for change and the transformation approach.

2.    Launching the transformation (Year 1)

Your staff will ask: What is this and what does it mean for me?

Once funding and the strategic approach have been approved, you will need to share the news with department colleagues. More than just updating them, you will need to use your relationships and influence to bring them into the fold, to get them onside with the change, and to get them ready to help drive it.

This is when staff and leaders could become anxious about the change; in some cases, the change process begins, only for people to realize that the rationale or endpoint may be unclear. Your job (with your team) is to champion the proposed change, its impacts and benefits, and solicit input on how to reshape parts of the operating model, including the culture and the way services are delivered.

Co-design can be valuable – this might involve inviting staff to articulate what the new culture should look like or involving external stakeholders in redesigning services.

You should also appoint a Transformation Lead, who will be responsible for running the transformation program smoothly and reporting into the program governance body. This person should have experience transforming organizations and have strong skills in leadership, project management, stakeholder engagement and change management.

At this stage the people around you should be internal communications and change management leads, direct reports/associate deputy ministers (ADMs) as well as your Transformation Lead.

You need your team to develop the transformation governance structure, project plan, risk register, benefits realization framework, and articulation of the steady state. These should be developed in partnership with your departmental/ministry chief administrative and information officers (CAO and CIO).

This is the time to explore external delivery partners to help you deliver the transformation. Partners can add capability and expertise but also much-needed capacity for implementing the changes, so your staff can continue on with their important day-to-day work.

3.    Steady state of transformation delivery (Years 2-5)

You should ask yourself: Is this working, and if not, how can we make it work?

Now you are in the thick of it, delivering a transformation across your organization. You must focus on keeping up the transformation momentum, quickly making decisions and removing roadblocks, monitoring the performance, and mitigating risks.

At this stage, the transformation deadline can be at risk if momentum lags or if the end-state vision becomes distorted or diluted. We often see change-resistant stakeholders dig their heels in – that is when change leaders need to seek to understand concerns and possibly provide stronger top-down direction. To mitigate this risk, leaders should undertake well-managed engagement and continually reinforce the culture change and benefits to employees and stakeholders. Leaders must model the new culture throughout the transformation delivery years.

During this phase, your team needs to include people who can accept risk for the organization, assess data on progress and benefits realized, and make quick decisions about people, policy, funding and technology. Using an agile governance model, you will have agreed on an overarching timeline and phases but rapidly need to pivot and learn in order to achieve your desired outcomes.

4.    Program wind down and continuous improvement (Year 6)

Your minister, secretary of cabinet and colleagues will ask: What did you achieve and how will we sustain the change?

At this stage, the major change has been made and the focus turns to assessing the outcomes to date and quantifying the benefits of the new operating model in the years ahead.

For the benefits to continue to accrue and then sustain, you will need to establish capability and oversight mechanisms. Formal reporting should be established from a continuous improvement lead and from your CAO – people who will be accountable for driving the benefits and overseeing progress for several years following the transformation. You should also seek formal reports from your ADMs on how they are sustaining the change.

Transformation can be complex and challenging – but is essential

Success! It’s time to congratulate your team and celebrate – you have earned it. Public sector transformations are notoriously complex and challenging, but if you remain agile and have transformation governance and leadership that is fit for purpose, you can create the authorizing environment and achieve the change you desire.

The benefits of successful transformation are manifold – for citizens who can rely on better services, ministers who can achieve greater efficiency and colleagues who can work in a way that maximizes their impact on the world.

As you endure the inevitable frustrations and setbacks, it is valuable to keep focus on the reason why you are undertaking transformation the first place.

To hear more on this topic, join us at IPAC’s Leadership Summit on March 2, where we’ll be hosting a panel on “Leading Transformation” and going into greater depth with senior public sector leaders on the topic of transformation.

Kelly Rowe is a Principal at Nous Group, an international management consultancy with an office in Toronto.