One of the issues that arises in the public water utility sector is where are the leaders? A recent online discussion of the issue identified a number of barriers to public sector leadership, which differentiates the public sector from the private sector. The three issues were associated with risk tolerance in the public sector which stifles innovation, application of business principles to public sector efforts, and the lack of vision and understanding of consequences. Related to the latter is the understanding of the various types and perspectives of expertise within the industry. Over the next three blogs, we will talk about each. Comments welcome of course.
So the first one. For the most part, public officials, city managers, finance directors and elected officials, are particularly risk averse individuals as a group. For one thing, their tenure in any given job is relatively short (city manager are aground 2-3 years). Elected officials spend much of their time trying to stay in office, so clearly their leadership is guided by public opinion, never a strong point for leadership. Regulatory agencies can only be criticized, so why be innovative? For all three, plus the employees working beneath these folks, their performance is in the public eye and the public is rarely forgiving of continued or significant failures. However, innovation is often correlated with risk, which suggests that the risk associated with failure may limit the pursuit or acceptance of innovation – instead keep doing what you have been doing because that creates no waves. Nevermind that the same old way may be inefficient or outdated, the concern is the risk if a new idea fails. The reality is to “stick with what works,” a mantra that has existed in the industry for many yeas, does not accept innovation easily. Particularly of issue is organizations where many mid- and often upper division managers avoid decision-making, but may be particularly poignant in pointing out decision failures of others as a means to improve their own stock – “I’ve never made a bad decision.” But as in baseball, sitting on the bench 0 for 0, means you have never had an at bat, so you have accomplished nothing, while the person who is 6/10 may have accomplished a lot. It is successful risk taking that may lead to changes in the organization, changes in doing business, improvements in efficiency and new means to accomplish tasks or deliver services. You need to think “outside the box,” to use an overused euphemism.
So the question is how do we get the public and the public officials to accept risk taking, and to relax their risk averseness? For innovation to grow, we need leadership, which means risk tolerance. After all doing the same thing over and over, and expecting different results is the definition of insanity isn’t it?