What Matters: Innovating for a better city

Innovating for a better city

3 December 2011

The Takeaway

New York City Mayor Michael Bloomberg says cities need to innovate just as much as corporations—and offers prescriptions for how to do it.

Fifteen years after founding my company, I wrote an autobiography that forced me to look back on my experiences – not something I had had much time for. In doing that, I realized that my chief function at the company had morphed from managing day-to-day operations into soliciting new ideas and driving the best of them forward.
“I make sure we allocate resources to new, innovative, and risky development projects,” I wrote in Bloomberg by Bloomberg (Wiley, August 2001). “My job is to ensure that new products come alive at Bloomberg and to integrate them with the rest of our system.”

When I first ran for mayor of New York, many people were skeptical that an outsider could run the biggest city in the country. There are, of course, major differences between the public and private sectors, but the primary challenge for a chief executive of any organization is the same: to encourage and enable the workforce to consistently find new and improved ways to serve our clients.

In general, government tends to be risk averse, because taking risks means taking on special interests. It means getting attacked in the press. And, for elected officials, it means potential consequences for your reelection.

That’s why many officials tend to play it safe. Even when they want to be bold, there are often bureaucratic barriers standing in the way. For example, different agencies are often isolated into silos instead of integrated across functions. Some of this is attributable to restrictive legislation and regulation, antiquated work rules, separate funding streams, competitive jockeying, and differing cultures. But sometimes the reason agencies do not work well together is less complicated: they’ve never been expected to.

There is another challenge to innovating in government: public dollars are scarce, and especially in these times, it is hard enough to fund existing basic needs let alone new experiments. Even in better times, it is challenging to use taxpayer dollars when the possibility of failure is real. The public rightly expects its money to be used in productive ways. You simply cannot ask taxpayers to take the same risks as shareholders or partners.

In New York City government—much like at Bloomberg LP—three key approaches have helped us get around these and other challenges to drive innovation forward.

Empower your team

I expect my staff to value creativity and new ways of thinking. Citizens deserve more than tweaks to the status quo—so I reinforce to commissioners and other policy makers that bold, new ideas should be the rule rather than the exception. This mandate empowers leaders to push themselves and their teams beyond their comfort zones, to look with fresh eyes at challenges and potential solutions. Simply giving permission to innovate is insufficient; you have to expect it and hold people accountable for delivering it.

Remove the barriers

Being clear-eyed about barriers to innovation and removing them is also important. For example, we’ve raised private philanthropic dollars to subsidize innovative new programs, such as our new comprehensive effort to help black and Hispanic young men achieve at the same rates as their peers in other ethnic groups. When we’ve tackled issues like sustainability and poverty that span numerous agencies, we’ve created cross-agency teams to improve coordination and results. As a result, our sustainability program has produced a 13 percent reduction in New York City’s carbon footprint over the past five years.

Support those who fail

When it comes to innovation, the one thing you know for sure is that it will not always succeed. In New York, the intense media focus can be a disincentive for innovation, which is why I’ve always believed it is critical to give a public pat on the back to those who took reasonable risks but failed. That’s how you keep the new ideas coming in—and it’s how you keep attracting the top talent.

These three approaches have helped us drive innovation in areas ranging from poverty to sustainability to education to creating new open spaces. And mayors from cities all over the nation are launching their own bold solutions to many of the same challenges.

That’s why government innovation is one of the five focus areas of Bloomberg Philanthropies. The centerpiece of our government innovation work—called the Mayors Project—aims to spread these proven or promising ideas among cities. By replicating innovative programs, policies, and leadership strategies, we know we can help fuel cities’ efforts to solve pressing challenges and achieve even greater impact.
One of the most recent Mayors Project investments is in Innovation Delivery Teams. These are stand-alone teams of top performers who bring a rigorous focus to developing and delivering powerful solutions to major urban challenges. The three-year initiative will fund teams of 6-to-12 members each in five cities: Atlanta, Chicago, Louisville, Memphis, and New Orleans. And in each city, the team will focus on top-priority issues identified by City Hall, ranging from job growth to customer service to public safety.

It’s exciting that the teams will help these five mayors produce new, tangible results for their residents—reducing street homelessness in Atlanta, the time Chicagoans wait in line to receive city services, and the homicide rate in New Orleans. But Bloomberg Philanthropies has a broader purpose, too. Through this initiative, we hope to refine a set of leadership and management strategies that ultimately can be used by mayors in cities worldwide to advance bold innovation.

The need for local government innovation is now greater than ever. When I talk with my colleagues in cities across the nation, they say they are being asked to do far more, often with much less. Citizens expect more. Many residents, hard hit by the recession, need more. And there are fewer public dollars to respond. That’s certainly the case here in New York City—and that’s why we’ll continue empowering leaders to drive innovation, reducing the barriers they face, and supporting all those who keep challenging the status quo with innovative new ideas. And that is why, through my philanthropic work, I will continue to support others who aspire to do the same.

Comment [10]

Agree? Disagree? Let us know what you think. Please include your full name with your comment. Comments may be edited.

Love your site and especially your name! Thanks for the awesome concept and great articles. I couldn’t find a share button to push it to Facebook or other sites aside from Twitter.

Posted 19 December 2011, 13:44 by Bryan Thomas
Innovation is just an euphemism for other stories. Extremely political as a “make believe.”

Posted 18 December 2011, 04:16 by John Dizon
I wish Michael Bloomberg could be the President of the USA. We need better options on both sides of the aisle.

Posted 7 December 2011, 10:06 by Joe Jackson
These three key approaches are absolutely spot on for me. Research reveals diverse attitudes toward innovation at board level still though: “One chairman’s view on the board and its role in promoting innovation was that: “Innovation at board level is not our responsibility. Instead we approve budgets and appoint a Chief Technology Officer based on proposals from the CEO… [innovation] is not for the board to engage in”. Whereas a chairman of a large Asian industrial conglomerate offered this interesting approach: “We [the directors] constantly ask for new solutions and ways to do business. We challenge the CEO and his team with questions about the ‘Holy Cows’ that they promote in the traditional approach to our business. Instead, we want new disruptive ways to engage with competition and to serve our customers…”

This from a study of over 60 chairmen and CEOs from leading multinationals interviewed by Professor Ulf Lindgren.

“Professor Lindgren found that the first attitude, based on the belief that innovation comes from research in the traditional sense of product and technology development, is deeply rooted in the minds of many board members. In this case he concludes that not only is this first attitude wrong but could also be deemed as a sign of a very dangerous approach to innovation in corporations.”

More insights from this research over at IEDP – link in my name.

Posted 7 December 2011, 05:36 by Daniel Chadwick
I think one key thing to recognise is that Mike is successful in NY because he is not there to make money or raise his profile, he is there as the job needs to be done better and he believes that change is possible. People believe him as he has crushed his competitors with his firm, and continues to do so. Credibility is so often lacking in senior public servants, making it hard for them to be radical in approach. So many use it as a means to network and feather their own nest at the expense of taking the hard choices.

My simple rule of thumb for judging employees is to look at their attitude to the people standing in front of them. Is their firm or department run for their benefit or for their clients and customers? It is all about accountability.

Keep up the good work Mike.

Posted 6 December 2011, 09:01 by Ian Jackson
It seems to me that both the government and the consumer are solely in need of something to look forward to. A new perspective on the future which would inspire a climate of changing expectations in contrast to the declining expectations of today. If we are correct in believing that a change in the prevailing rhetoric can trigger that change in governments, policies, image, actions and initiatives then the strategy for local government must clearly be able to sell change. It is difficult to sell change at any time, however when there is tension it becomes more salable. I do not know if local governments are capable of understanding the change that is needed, have the assets in place to bring about change and can execute. Innovation in the above is sorely needed.
Steve Weiss
e-mail: questweiss@aol.com
web-site: disregardpreviousinstructions.

Posted 5 December 2011, 15:17 by Steven Weiss
I don’t think your assessment of the situation goes far enough and doesn’t address the key issue.

Most cities don’t offer an experience that is any way joined up. Stakeholders see no reason to cooperate with each other – preferring to operate in silos – racking up their operational costs as a result. This fragmented customer experience costs the local economy money as people with limited discretionary spend are increasingly electing to spend money on things that make them feel good and which can be shared with others – these experiences are always digitally powered.

Stakeholders that are prepared to cooperate by linking together their customer databases (with the consent of their customers) will discover that people appreciate being treated as the same person (rather than as a customer, a patient, a diner, a student, a fan and so on) particularly if the contact is timely, relevant and personalised. Smart technologies do this effortlessly.

Back of house functions can be shared and savings passed back to smartcard carrying members of the community in the form of personalised rewards for contribution like volunteering. Empty seats are converted into rewards for those able to prove their contribution to community.

So a digital infrastructure (linked databases) is the means to get different stakeholders functioning together as a single organisation thus delivering a joined up experience for the customer/citizen.

Issue the rewards in the form of a digital community currency (a bitcoin for good!) and you have the beginnings of alternative complementary system that incentivises contribution. People can now choose which system they want to exist within by selecting which currency they want to use.

The most competitive cities of the future will be those most able to quickly align their stakeholders around the same aims and objectives. What gets measured gets done – I say measure contribution.

@mikeriddell62

P.S. We’re doing this in Wigan.

Posted 5 December 2011, 14:33 by @mikeriddell62
Place-based innovation is one expression of the global competition for growth between cities. But it doesn’t have to be a race to the bottom. Mayors can do a lot to make themselves and their agencies accountable to aligning the bottom line of companies with equitable social, environmental, and economic prosperity in the places they govern. Michael Bloomberg’s PlaNYC 2030, the City’s sustainable growth plan, has been an important gesture in this direction. If used as a tool for monitoring the local conditions it aims to nurture, PlaNYC could be a powerful governance tool for future City leaders. I discuss the optimizing potential of planning and reporting cycles—for cities and companies—in my article “Integrated Reporting in a Competitive World of Cities,” (HBS e-book, 2010). It can be accessed from the above website.

Posted 5 December 2011, 13:54 by Jen Petersen
Mayor Bloomberg raises a thought provoking issue regarding innovation in the local governments, where usually politics plays a bigger role than what might be good for the constituents. In these tough economic times, local governments should look for ways to streamline operations and remove barriers to encourage local organic growth that would in turn help create jobs.

Posted 5 December 2011, 13:52 by Zahid Masood
I think these comments are spot on. Whether in the public or private sector a senior leader has to demonstrate that taking risks is part and parcel of progress. His comments regarding moving between the public and private sector also resonate. Having changed roles several times I know too well the cry of “the person has to be from the industry, has to have done the role before, etc”. I have found that an intellectual and emotionally intelligent leader, with curiosity and courage can move between functions and industries. In fact there is great opportunity in coming to a new area without prejudice of “how things were done before.” Thank you for the inspirational thoughts.

Posted 5 December 2011, 10:41 by Jeannette Lichner

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