Open innovation in DC

Eric Ries · June 28, 2011 · Short URL:

Using public policy to promote economic growth through entrepreneurship

Something interesting is happening in Washington, DC right now. It's not the usual partisan fights about the budget or the deficit. In fact, it doesn't fit any of our stock ideological categories very well. The Federal government is being transformed - initially, in small ways - by people I think should be recognized as entrepreneurs. They are leveraging the same kinds of new technology, management thinking, and big data to improve lives that we routinely use here in Silicon Valley.

I was invited to speak on a panel in the White House "Champions of Change" series. The topic of the day was Open Innovation; honoring a group of individual entrepreneurs doing innovative work inside and outside the public sector. (For some examples of presenters who were recognized, see Mom MapsZonability, and Localocracy.)

I was asked to to share some "perspectives from the private sector" and was joined by two impressive co-panelists: Proctor and Gamble CTO Bruce Brown (you should read this HBR article about how he's empowering P&G's internal entrepreneurs) and McKinsey Global Institute director James Manyika (you should read his report on the productivity gains made possible by open data).

I did my best to focus the conversation on key concepts like minimum viable product and rapid experimentation. Every story of innovation that was recounted throughout the day had these common elements. Most of the projects had a technology component, but few of the entrepreneurs were technologists by training. Most had simply seen a need and figured out how to get started; in many cases, teaching themselves how to program. We saw lots of examples of the "concierge MVP" technique, where an entrepreneur solves customer problems manually, by hand, before automating the solution. And we saw lots of direct engagement with customers, figuring out what really needs to be done.

What I tried to stress is that these new experimental approaches constitute a whole new way of looking at work. Open data, open innovation, and big data are enablers of this new management method, by making it possible for organizations to continuously - in real-time -  evaluate whether their work is having an impact. And as always, I emphasized the need to develop new tools to work in this new way, what I call entrepreneurial management and innovation accounting (read the book to get the full scoop).

"There's never been a better time to innovate"
United States CTO Aneesh Chopra kicked off the event by saying: "there's never been a better time to innovate." Organizational change of this magnitude requires a combination of strong executive leadership, new tools and techniques, and bottoms-up energy and exploration. Right now, all three are present in DC. The President has made this a priority, in both word and deed. If you're not paying very close attention, you probably haven't heard much about this, because it doesn't get much attention in the press. 

For example, you probably didn't notice that on April 27, 2011, the President issued Executive Order 13571, with the sonorous title "Streamlining Service Delivery and Improving Customer Service." While I was in DC, I learned about this EO as well as the guidance document that instructs executive branch agencies on how to implement it. In these documents, the entire executive branch is committed to taking a customer-centric view of new initiatives, including a few bullet points that may sound a little familiar to readers of this blog. Take a look:

"Use customer feedback to improve the solution, repeating the process to rapidly create an effective solution that meets the customer service need."

Now that probably doesn't sound very dramatic, but I have become convinced that it is. Through executive leadership, individual innovators are being given the mandate to try a new approach based on rapid experimentation and customer feedback.

I know there will be skeptics reading this post, and you are right to be skeptical. A few words in a document aren't proof of a new approach. But I talked to a number of people in agencies across the executive branch that are actually using a lean startup approach. Most of these projects are nascent and haven't been announced publicly. But some have. Take a look at this profile of Todd Park, the CTO of HHS, who was one of the innovators honored at the Champions of Change event last week. Todd is an accomplished entrepreneur who was enticed out of an early retirement to do this:

Can Todd Park Revolutionize the Health Care Industry?
"I have no budget," he said. "I have no formal team. I don't control any government contracts. I don't control any grants. It's perfect, because it actually gives you the kind of freedom to maneuver, to really be a change agent." When he started the job, he created what he calls a virtual startup model. "The idea is you find a particular idea or initiative that you want to get going. And the first thing that I do is I find the three to five people at HHS who had that idea a long time ago, who have been obsessing about it, who know a lot more about it than I do, who have connections and data and resources and people that they can throw in the mix. And then I recruit them to join a virtual startup to do this thing." 
Given his roots, it's not surprising Park is trying to run his department like a Silicon Valley company. The deadlines his teams set are no longer than 90 days out, in fact they're often shorter. Each project moves at a rapid velocity, with him acting as the virtual startup's CEO. Once one reaches maturation, he hands it off and then moves onto the next virtual startup.

Ninety day projects, implemented by small teams and each with clear customer outcomes. The amount of feedback these teams are processing is really impressive. It is anything but the image of the stodgy government bureaucrat.

"Think big. Start small. Scale Fast."
United States CIO Vivek Kundra talked about the process they've used to build, a platform for open data access that is now used across the government. He said that " was as a minimum viable product." In two years, it has grown from just 47 datasets to over 390,000. The process they used to build it is distinctly different from the old paradigm of slow-moving bureaucrats in league with even-slower-moving contractors.

That's why I'm excited about what's happening in DC. As I said at the start, it really doesn't fit our existing ideological categories. It is shrinking the size of government ("the cloud" alone is already saving billions in IT procurement), but improving its ability to help citizens succeed. It is "pro-growth" in its truest sense: using public policy to promote economic growth through entrepreneurship and innovation. And it's unlocking the creativity of citizens to make things better - whether they work in government or just build on its open API's.

Vivek Kundra summed up this whole new philosophy with six simple words:

Think big. Start small. Scale Fast.

(Image source: americancoachtours)

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