Sunday, January 3, 2010

Predictions for 2010

Big charities going under. A rash of major mergers. Mass-sackings of CEOs. Fall-outs with Government. My predictions for 2009 all turned out to be wrong, in fact, it was business as usual for many of us. So am I eating humble pie? Well - no. I think I was right in everything - except my timing.

Our sector, you see, is a bit like the public sector - trapped by its recent history. With noble exceptions, most of our major charities are simply doing a better job than the Government of delivering First Generation Public Services. These services, though much better and more efficient, share the doomed formula of high cost and low effectiveness of nearly all First Generation Public Services.

Therefore, the absolutely critical challenge facing all major UK charities is how to create Second Generation Public Services that are better, cheaper and faster - and “co-produced” by a population used to having things done for them. This is the public services equivalent of moving from the mainframe computer to the IPlayer in one go. It is going to require a revolution. In innovation. In design. In delivery.

How might this play out? Well, the learning from other sectors is that dominant First Generation organisations tend to be usurped by smaller, more imaginative ones. Small-scale experimentation, backed by risk-capital generating thousands of ideas, a handful of which become the mainstays of the future.

Although we must be realistic about comparisons with Silicon Valley, the forthcoming fiscal crisis is going to open up the public realm to similar processes. Not only will this be the end-game for many public sector agencies, it could be ours too with the cancellation of contracts for standard-issue public services from our bigger charities. Instead, new players will come along with entirely new ways to produce social benefit.

If you think this sounds far-fetched, then wake up. Participle is a social business which redesigns public services from the ground-up. Founded in 2007, without a legacy of First Generation services, Participle is free to focus on clean-break approaches – which many councils are already buying into. Whether the big charities behave like Participle - or still carry on fighting the last war - will be the sector’s biggest single test in the 2010s.

Which brings me back to those predictions. Firstly sackings. There are not enough radical thinkers leading top charities so, yes, some CEOs will need to make way. Secondly mergers. There will be an urgent need for capital to fund innovation and redesign so there will be more mergers. Thirdly, relations with Government. The sector will need to take bigger risks in its relationship with Government if we are to become a decisive force for change in the 2010s. The relationship can take it. We must stop the toadying and have the confidence to lead.

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