What is public sector innovation and how do you actually do it?
'Innovation' is a hot topic in the public sector at the moment. But in more instances than we might like to admit its meaning often falls somewhere between intangible jargon and opaque academic speak. The aim of this guide is to make innovation in the public sector real, practical, and action-oriented.
A place to start is with some definitions. While we may not be able to provide the official definition-to-end-all-definitions of Public Sector Innovation, we'd like to lay out in plain English how we are using this term and why it genuinely is worth caring about.
At its core, innovation means doing things differently from how they’ve been done before. This can range from small, incremental improvements to bigger, bolder transformative changes. One of the most common drivers of innovation is technology, which can open up new and more effective ways of solving existing challenges.
Innovation also involves a degree of uncertainty. If the need for change were obvious and the solution clear, it likely would have been implemented already. As a result, innovation is about testing whether new approaches can deliver better outcomes and add real value. While uncertainty is something that many services avoid because of the risk it poses to services that people deeply rely on, innovation done well creates opportunities to fail safely.
Innovation in the public sector does exactly what is says on the tin: government and public sector bodies exploring new ways of doing things that have impact and ultimately improve public services.
Public Sector Innovation is about helping public organisations respond to real-world challenges more effectively.
Innovation has the power to fundamentally improve public services and the lives of the people who use them. When public bodies explore new approaches or make better use of technology, they unlock ways to deliver services that are more efficient, more personalised, and easier to access.
At the same time, it strengthens public sector bodies by building their ability to adapt and respond to change. This could be through engaging more with private sector organisations, deploying emerging technology, working with innovative suppliers or simply becoming more agile and user-centred.
In the end, the result is better value for taxpayers. Innovation can help ensure that public funds go further, and the outcomes delivered have a greater impact.
Innovation is successful when it is no longer innovative. When a new way of doing things becomes the way to do things. If you, people you work with, or people you are trying to help are finding things easier or getting better results because of a new approach then you’re innovating.
Innovating is something that’s easy to say and hard to do. The gap between trying something new and seeing meaningful results can stretch from days to months, or even years. During that time, it’s tempting to fall back on familiar ways of working or to abandon the new approach altogether. That’s often when promising ideas lose momentum and their potential is lost. The reverse of this is that sometimes innovation does not deliver the outcomes you want and the gap between taking action and this becoming clear creates space for wasted efforts. We will take a look at how you can overcome this challenge in different innovation activities below.
Innovation can take many shapes and forms. But, to help make sense of what can often be an nebulous concept, you can think about public sector innovation in two categories. These categories reflect the role you - as a civil servant or public body - can play in relation to any given innovation.
What does this mean? Let's take a look at the two categories below to get a better sense of how we've broken it down:
Enabling innovation within government
Public or civil servants doing their job differently using tools that are readily at their disposal. This looks like you or your team implementing innovation yourself within government and the teams you work in.
Engaging with innovation outside of government
Creating an environment for innovation to happen in line with your objectives outside of the public sector. This can look either like you or your team using new programmes to support others - such as industry or academia - to do the innovating or using ways to bring that innovation into government to help deliver your priorities. Sometimes it can be both!
This is by no means a scientific way of categorising innovation and there are certainly overlaps between the two. But, it is useful to imagine how you can bring innovation into what you do in a practical and action-oriented way; this can help avoid the all too common trap of using the word 'innovation' to somehow mean everything and nothing at the same time.
In each of the two sections below, we look at a set of activities that you can do that drive innovation in the public sector. Each activity will answer these questions:
Each activity you can dive in to will answer these questions:
Sometimes the most effective innovations can be achieved within the confines of your own work, your team or your department.
Outcomes can be more efficiently reached from changing the way you problem-solve, manage projects, collaborate with others or collect data. Often, this type of innovation is widely applicable to public sector organisations who run into common problems like inefficient processes, a high-demand on user centricity of services and a need to demonstrate good value-for-money.
Critically, when public services are too important to risk uncertainty but also too important not to transform through innovation, enabling innovation is about creating space to fail safely. This theme is also looked at in the Engaging with innovation outside of government section but you should prioritise this in these activities too. Ultimately even creating simple risk-free and playful environments when talking with colleagues can start to help teams become more agile, data-driven, design-led and build innovation maturity.
To find out more about innovative activities you can start in your organisation, click below:
Making sure that services are designed so that they serve users’ needs sounds self-explanatory. But more often than you may think, when new services are developed or as they are changed over time it is a set of other factors that affect how they operate. It can be very easy to lose sight of what users of services actually want when you are trying to manage regulations, go through complicated procurement processes, stay within budgets, navigate timelines, and deal with other complications of running public services. User-centred design (UCD) is a methodology you can employ to stay focused on the key principle of servicing what users actually need.
By leveraging UCD you can improve user experience of the service, and in being disciplined to needs, you can often build better value-for-money and be more efficient with delivery. These principles help you design a service or a change to a service and when it comes to delivering these designs, using some of the agile methodologies we describe in another innovation activity are a perfect way to do it!
Fortunately, the UK’s Government Digital Service has a world-leading Service Manual that embeds a series of user-centred design techniques within it. Government services must comply with the service manual meaning there is a process-reason to follow the standard. Above and beyond that, it is a great place to start and familiarise yourself with some of the key UCD principles.
Crucially, you need to start with a discovery process. This is where you deeply understand the needs of your users by using a set of techniques to draw out their needs when talking to them and translating that into a usable format on which you can make further design decisions.
In user-centered design (UCD) thinking there are a wide range of tools and techniques you can use to build your understanding of users, iterate your developing ideas and test them with users. Which of these tools and techniques are best matched to you depends on a variety of things, including which ones you like and understand the most. As well as the GDS Service Manual there are an extensive amount of resources - such as books, websites, online courses, etc. - that offers an introduction into some of the options you have. It is worth spending some time looking at the tools you already have access to, the capabilities of your team and the access you think you’ll have to users before deciding which methods to use.
Following UCD principles to improve services can have some risks. As mentioned, there are many different approaches you can take when doing UCD. Demystifying them can sometimes be tricky, especially if you are new to UCD. Try exploring the templates and guides that might be built into tools you or your colleagues use. Things like Miro, Figma, LucidChart and Mural all have templates built into them which will make it easier to follow and execute.
Another pitfall is often rooted in the fact UCD is a new, innovative way of doing things. One of the key principles of UCD is to consistently test assumptions and make changes if you get new data or new needs from your users. Unlike in many processes we are all used to when you work on something, finish it and put it down, you shouldn’t do that in UCD. For example, one of the things you should do in UCD is to build user personas that summarise the needs of different groups of users, but if you do more interviews or test new service features that challenge and assumption you’ve made you may want to go back and adjust your personas, or even split one out if difference emerge and create new ones. This level of flexibility can rub up against governance processes or working practices which tend to follow more linear progressions on projects. To combat this you should work very transparently, have regular opportunities to explain thinking and be clear in setting expectations when you kick off processes where you will utilise UCD.
Agile is an iterative approach to delivering projects that helps teams build relevant products and services that align with citizen needs. An agile approach prioritises customer satisfaction, embraces change, and promotes collaboration and continuous improvement. Upskilling in agile methods offers a powerful way for you and your team to become more adaptive and responsive to change. It’s especially valuable in fast-moving or uncertain environments, where solutions need to evolve quickly and be grounded in real-time feedback.
Upskilling your team in agile can lead to:
Crucially, agile isn’t a one-size-fits-all solution. Upskilling in agile means your team gains the flexibility to pick the right management approach for whatever the project context is. This capability ensures better outcomes, grounded in evidence and built for impact.
If you're looking to upskill in agile project management, there are accessible and practical ways to get started - no matter your current role or experience level. Here are three effective steps to begin building your confidence and capability in agile practices.
If you're looking to upskill in agile project management, there are accessible and practical ways to get started - no matter your current role or experience level. Here are three effective steps to begin building your confidence and capability in agile practices.
Recognising common pitfalls early on can help you avoid frustration and set your team up for lasting success. Below are five barriers to watch out for, along with tips to navigate them effectively.
Monitoring and Evaluation (M&E) is the practice of measuring the outcomes that have stemmed from a programme, policy, service or product. It is important to understand whether the project has been a success and gives you clear evidence to communicate the outcomes and impacts of that project. Further to this, evaluation helps us to learn and track what works, and what doesn’t, and to understand why so that good practice can be replicated, repeated and scaled. This way, poor outcomes can be avoided.
M&E can help us to understand where innovation can be implemented and, if you are doing so already, where innovation has been effective, or less effective. When done correctly, M&E can give teams insights that they can use for future decision-making and allows for iteration and improvement to the projects we do. M&E provides us with evidence to decide where innovation is worth doing and where, if necessary, you need to stop doing something that isn’t working to ensure resources are used effectively.
Good policymaking, project and programme delivery should be underpinned by M&E, feeding into regular, continuous improvement.
For those new to evaluation, the first place to look is HMT’s Magenta Book, which outlines best practices for conducting an evaluation, as well as key protocols that UK public sector teams should follow in their evaluations. Additional guidance is found in HMT’s Green Book which provides a framework for creating Government business cases and appraisal plans. Similarly, The Evaluation Taskforce provides guidance, best practices and training, while the What Works Networks have provided evaluation guidance across a number of sectors in the context of driving more evidence-based policymaking.
M&E starts with a Theory of Change (ToC), which is a tool that explains how the activities undertaken by a policy or project contribute to a chain of results that lead to the desired impact. They are maps that help you understand what needs to be measured and evaluated to understand if the programme has been successful.
Conducting evaluations are typically divided into three different strands: Process, Impact and Economic evaluations:
Evaluations are usually conducted by a team of evaluation experts and economists, who sit externally to the project delivery team so that they remain independent. However, there are a number of things that all teams can think about when it comes to evaluating their own projects:
M&E is often complex, but that doesn’t mean it has to be complicated. To make sure you can deliver or commission evaluations of your projects to gain the most benefit and encourage continuous innovation, it may be helpful to consider the below common pitfalls:
Enabling innovation has two distinct goals.
The first is about creating ways to leverage external ideas and solutions for public sector transformation. This complements internal "Implementing Innovation" efforts by proactively bringing in private or third-sector innovations through specific activities.
The second objective aligns with central government departments, local authorities, and regulators who may be tasked with fostering innovation and economic growth in the sectoral or geographic areas they oversee. The benefit here isn't always public service transformation, and can be in delivering other policy objectives, like economic growth. However, as we explain in "Run an accelerator" and "Create new innovation environments and sandboxes," promoting innovation outside government can circle back to public sector transformation.
Procurement is often seen merely as a compliance exercise and a mandatory step for the public sector to buy products and services. But, procurement is a powerful tool for the public sector to drive innovation, work with more innovative suppliers and bring private sector expertise into public sector programmes. Procurement can also itself be innovative to ensure that the public sector is getting the most out of its money and accessing new solutions to old problems.
Innovative procurement refers to public procurement that supports the development or adoption of new, experimental, or improved solutions. It includes new methods for purchasing these solutions, particularly those that involve working with non-traditional suppliers.
Leveraging innovative procurement mechanisms can lead to:
The Procurement Act 2023 went live in February 2025 and represents a significant change in how public procurement works in the UK. Amongst its key aims is an ambition to make procurement more flexible, innovative and agile. The main tool that has been introduced to achieve this is called the ‘Competitive Flexible Procedure’ (CFP), which we explore the importance of in our report on Using the Competitive Flexible Procedure for Innovation. The Cabinet Office has produced clear and comprehensive guidance about how to use the CFP in a way that is compliant with the new regulations.
The CFP provides contracting authorities with the flexibility to run procurements that suit their specific requirements and enables contracting authorities to design procurement processes for more complex or novel requirements, compared with traditional open-tender procurement processes. This includes allowing contracting authorities to design R&D-intensive competitions, using more flexible forms of testing and evaluation (such as site visits, and demos), and structuring multi-stage competitive processes to find the best supplier.
When considering how you can leverage the CFP and what form of innovative procurement is suitable for your team, it is important to:
Innovative procurement is great for buying new solutions, particularly emerging technology and new digital tools and products. The Blueprint for Modern Digital Government outlines the importance of more agile procurement approaches, with a focus on active market horizon scanning and engagement Similarly, the AI Opportunities Action Plan takes a strong focus on how authorities can use a ‘Scan> Pilot> Scale’ approach to procuring AI tools and products.
To leverage this guidance and help you do this effectively, you should consider:
Avoidable challenges like focussing more on the specification of solution requirements rather than the problem, are frequent. As well as these important points, other issues to avoid are:
A challenge programme is a structured initiative where you articulate a clear problem you are experiencing and invite technology providers to demonstrate how they would help solve it, usually at a showcase or demo-day event. Challenge programmes have a three major benefits:
PUBLIC has experience of delivering challenge programmes for a range of organisations. We have worked on challenge programmes with government departments like MoJ, regulators like the Environment Agency and a wide range of local councils in collaboration with the Local Government Association. Short of collaborating with a partner like PUBLIC, though, establishing a forum within your organisation that contains a variety of people, roles and experiences is a great place to start. Using these networks to discuss challenges, identify commonalities, and sow the seeds for collaboration in solving them is a strong basis for a formal challenge programme.
Working with your procurement or commercial teams to ensure that you have a viable route to using challenge programmes as the basis of a procurement strategy can set challenge programmes up for success. Challenge programmes can work well as stand-alone market engagement activity, but they are turbo-charged for all stakeholders when they are the launchpad for buying a solution.
Demonstrating a route to scaling of solutions means that you are more likely to get senior-level buy-in for the formation of challenges and you can attract the highest-quality innovators to participate in the programme. Aligning a programme with procurement strategy can introduce complexity and delay and, therefore, the decision of how closely it is in line needs to be balanced.
A startup accelerator is a programme where solution providers receive training and support to scale their business. This can be delivered in a variety of formats and over different time periods but has the objective of helping startups to grow. You may want to sponsor accelerators in the public sector to support the strategic growth of sectors that are of a policy priority to you.
This policy objective is likely to be one of three things:
The first thing you should do if you are establishing an accelerator is to conduct a thorough needs assessment. You should have a detailed view of if and how an accelerator can be useful to various stakeholders:
Once you have the scope of your programme and the needs of potential participating startups crystal clear, there are a few really important things you need to do to ensure your accelerator is done effectively:
The reverse of the things that can be done to make the programme effective are the most common pitfalls for accelerators. Below are a few common ones, alongside mitigation strategies to consider:
Creating environments that can be used for open innovation is crucial for enabling experimentation and fostering a culture of learning and improving. These spaces act as safe, structured environments where public bodies, suppliers, and users can test innovative ideas before wider implementation. They are effective for:
Public sector bodies can also learn to be more innovative and apply innovation practices in risk-free and playful environments internally. This helps teams to become more agile, data-driven, design-led and build innovation maturity within the public sector. Take a look at some of the activities in the 'Implementing Innovation' section if this is of interest!
As with any new endeavour, start with a clear problem or priority area and identify a real challenge with innovation potential and define the outcomes you want to achieve, not the solutions. This will help you identify what sort of open innovation environment is most appropriate. For example, if you want to explore how AI can support decision-making you could use a sandbox environment to test algorithms in a controlled environment, using synthetic data, before deploying them in live services. Or, if you want to co-create digital services that work for digitally excluded or under-served populations, you could develop an internal Co-Design Lab to partner with community groups, tech providers, and user researchers.
You don’t need to uphaul a system completely to create open innovation environments or structures that enable more effective innovation. You can start by assembling a small and committed team who are keen and excited to explore innovation. Start with what you have already, repurpose existing functions or budget lines to fund innovation activities.
Similarly, make sure you have buy-in from senior leadership and that what you are trying to do aligns with wider strategic goals and policy objectives. Ultimately, the purpose of these open innovation environments is to safely and collaboratively explore, test, and scale novel solutions to complex challenges by leveraging ideas, expertise, and technologies from outside and inside our organisations in order to deliver better services for the citizens we serve. It is always important to consider the bigger picture as we start developing innovative environments.
Innovation done without purpose, learning, or follow-through isn’t going to be effective. There are a few things to think about that will help you develop our open innovation environment and ensure it is grounded in real problems and can lead to change:
As the creation of open innovation environments is ultimately about doing things differently, there are a number of pitfalls to avoid: