The Introduction To Innovation in The Public Sector

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Introduction
Innovation in the Public Sector
Objectives
Innovation has long been criticised for its failure to fulfil the expectations of
higher efficiency and better service. Hence, this review is conducted to under-
stand better how to effectively define innovation in public sector organisations,
identify organisational barriers to innovation, leadership characteristics and
organisational climate issues that spur innovation. Accordingly, the primary
objectives of this chapter are to provide the theoretical underpinnings of innov-
ation in public sector organisations, which include (a) definitions and types of
innovation; (b) innovation and creativity; (c) the evolution of innovation theory;
(d) innovation at four different organisational levels; (e) innovation in the public
sector versus the private sector; (f) antecedents of innovation at different levels;
and (g) oversights in the innovation literature.
Definitions and Types of Innovation

Public sector organisations worldwide view the development of innovation as
paramount and inevitable, due to global competition. Apparently, the literature
informs that innovation has different notions and interpretations. According to
Mumford, et al. (2015), innovation refers to the development and deployment
of new processes, services and products. Nevertheless, as Edwards (2000) stated,
innovation is considered one of the semantics with different interpretations to
Copyright © 2022. Taylor & Francis Group. All rights reserved.
different scholars. Although various studies examined innovation in the public

sector, the results have been indecisive and lacked a consistent definition of
innovation as well as a tool of measuring innovation (Kimberley & Evanisko,
1981). In addition, several scholars interpreted innovation as novel ideas that
can be transformed into new processes, products and services to achieve a com-
petitive advantage and meet customer needs. According to Zaltman, Duncan
and Holbeck (1973), innovation is an idea or action perceived to be new in
a particular setting. Alternatively, innovation is the adoption of means or ends
that are original (Rogers, 1983). Notably, innovation is a complex task, but it is
ultimately based on an individual’s ability to develop new processes, products
and services (Mumford & Gustafson, 1988). According to Baer and Frese (2003,
DOI: 10.4324/9781003191131-1
Moussa, Mahmoud, et al. Innovation and Leadership in the Public Sector : The Australian Experience, Taylor & Francis Group, 2022.
ProQuest Ebook Central, http://ebookcentral.proquest.com/lib/flinders/detail.action?docID=7071043.
Created from flinders on 2022-10-05 23:07:32.
2 Introduction
p. 45), innovation is described as, ‘…deliberate and new organisational attempts
to change production and service processes.’ Daft (1978) noted that innov-
ation is the development and implementation of new ideas, processes, products
or services. Schumpeter (1934) perceived innovation as the execution of new
selections of a variety of organisational resources.
Damanpour (1992) acknowledged that innovation is the ability to develop
and adopt a new idea by an organisation, while Davenport (1994) reported that
innovation seeks to complete a task in a radically new way. Kanter (1984) stated
that innovation is the adoption and delivery of new ideas and processes of untrad-
itional tasks. West and Farr (1990) interpreted innovation as the introduction,
application and organisation of new processes, products and services that benefit
organisations, individuals, groups and ultimately the whole society. Martins and
Terblanche (2003) viewed innovation as implementing a new problem-solving
idea by an organisation, which can enhance a change process. In addition, innov-
ation is synonymous with invention, as a creative process that develops new
configurations (Hage, 1999). Anderson and King (1993) distinguished between
innovation and organisational innovation.They defined innovation as a cognitive
process that is impacted by psychological and social factors, whereas organisa-
tional innovation refers to a social process that defies the status quo.
Damanpour and Evan (1984) noted that innovation is a broad concept that
can be defined in different ways to reflect specific characteristics or requirements
of a particular study. For instance, Knight (1967) expounded that innovation
is a social process resulting in major changes in an organisation’s structure
or procedures. Drucker (1954) interpreted innovation as one of the major
functions of an organisation. However, Rogers (1998) perceived innovation
as knowledge creation and diffusion of the existing knowledge. Furthermore,
it is apparent that the measurement of innovation is a complex subject in the
existing literature. It can be argued that this is due to the misuse of the con-
cept of ‘innovation’ and ‘innovativeness’ in collecting data for research, hence,
reporting confusing results. Nonetheless, McMurray and Dorai (2003) developed
the ‘work innovation scale’ (WIS) that is tailored to measure and identify the
behavioural characteristics of innovation practices in organisations. Specifically,
McMurray and Dorai concluded that organisational innovation (OI), innov-
ation climate (IC), individual innovation (II) and team innovation (TI) are four
measurable factors that characterise workplace innovation. Moreover, Martins

and Terblanche (2003) stated that innovation level differs from one group, one
organisation and one culture to another, thus, assessing innovation should be
conducted at the individual, organisational and industry levels.
Tidd (2001) claimed that there is no specific way that measures innovation;
however, there are two approaches at the organisational level. One uses existing
indicators in the public sector, including R&D expenditure, new product
announcements and number of patents. The second applies various indicators
through surveys. Contingency theory can assist with understanding how con-
text affects innovation management processes (Tidd, 2001). In other words,
Tidd argued that the higher the level of fit between environmental complexity
Introduction 3
and the level, organisation and management of innovation, the greater the
effectiveness of an organisation. Over the past two decades, scholars applied
two measures for evaluating innovation in organisations. The first measure
encompasses the quantity of innovations implemented, while the second
measure includes the period required to adopt a particular innovation in an
organisation (Wilson, Ramamurthy & Nystrom, 1999). Lastly, Gieske, Buuren
and Bekkers (2016) reported three determinants of innovative capacity. These
were actors, organisations and networks, and for each level, they differentiated
between different aspects of innovative capacity that can help with evaluating
the innovative capacity and learning capacity of public sector organisations.
Types of Innovation
The existing literature reveals various types of innovation, and each type of
innovation is based on a specific approach. For instance, the ‘socio-technical
systems’ approach presents innovation, according to the context/system in which
they occur. Knight (1967) categorised innovation as internal and external types.
It is argued that internal innovation is more complex than external innovation
to achieve, and the internal types of innovation are said to be different structural
arrangements and different procedures in an organisation.Administrative innov-
ation involves innovations in the organisation’s administrative process, while
technical innovation refers to innovations that include technology in the organ-
isation (Knight, 1967). Technical innovation is improved by little restrictions
on operations, low centralisation and a high degree of professionalism. This
includes products, services and technologies in the organisation’s operations.
They refer to basic organisation’s activities and emphasise products, services and
processes. Administrative innovation is enhanced by high levels of formalisation
and centralisation and a low level of professionalism. This includes administra-
tive processes and organisational structures. It is argued that these innovations
are indirectly related to basic organisation’s activities and more directly related
to the management of those activities (Kimberly & Evanisko, 1981).
Product innovations can be seen in new products or services to sat-
isfy market needs and consumers’ needs (Knight, 1967). Whereas, process
innovations involve new elements carried out in different processes at the
organisational level (Knight, 1967). Radical innovations flourish through the

reconceptualisation of a business entity (Markides, 2006). This type of innov-
ation can be classified into three levels: (a) product: new ideas or technology;
(b) process: new methods of products and services delivered to customers; and
(c) the combination of product and process innovations (Tushman & Nadler,
1986). Incremental innovation involves the development of existing processes,
products and services (Leonard & Rayport, 1997). Architectural innovation
implies innovation that adjusts the architecture of a product without impacting
its mechanisms. In other words, architectural innovation is the reestablishment
of the current system by integrating the existing components in a new way to
develop a coherent whole (Leonard & Rayport, 1997).
4 Introduction
According to Anderson and King (1993), researchers applied various oper-
ational definitions of innovation through a number of innovation typologies.
The first typology involves a ‘socio-technical systems’ approach that categorises
innovation based on the systems in which they emerge. The second typology
involves the characteristics of innovations and the third typology is to clas-
sify innovations by their source. Hence, Anderson and King (1993) urged that
research on innovation should be examined at two levels.The first level involves
the characteristics of innovation types in a particular context, and the second
level should involve the psychological factors of innovation.
Innovation and Creativity

West and Sacramento (2012) revealed that early studies on innovation and cre-
ativity embraced two perspectives. These were ‘macro-level,’ and ‘individual
psychology.’ Macro-level approaches focused on contextual and organisational
factors and overlooked the individual’s role in innovation and creativity (Aiken
& Hage, 1971).Whereas, research on individual psychology revealed personality
traits, individual cognitive skills and level of intelligence (Barron & Harrington,
1981). Anderson and King (1993) noted a concern in the literature to dis-
tinguish between innovation and creativity and two major differences exist.
Innovation involves ideas that are new to the organisation or original ideas to
a group, whereas creativity involves new ideas to an individual. Additionally,
they argued that creativity does not necessitate the implementation of ideas as
does innovation, but it is perceived as a cognitive process influenced by social
psychological factors. On the other hand, innovation is a social process that can
change the current state of the organisation.
In a similar vein, Mumford and Gustafson (1988) argued that creativity
involves the generation of new ideas, whereas West (1989) and West and Far
(1989) noted that innovation entails the application of these ideas. In other
words, creativity involves the production of new ideas and innovation is the
translation of these ideas into practice that have a significant impact on indi-
viduals’ performance (Mumford, et al., 2002). Oldham and Cummings (1996)
indicated that creativity offers the motivation required for innovation. Hence,
innovation and creativity are sometimes used interchangeably (Scott & Bruce,
1994). Accordingly, the main source of innovation in organisations is individ-

uals who develop novel ideas (Shalley & Gilson, 2004). Subsequently, creative
individuals develop new opportunities for new products or services, apply
unorthodox ways of using existing methods, develop new solutions for solving
problems and develop sufficient plans for implementation (Gumusluoglu &
IIsev, 2009).
Notably, although many researchers revealed that individuals act as
antecedents to innovation at the organisational level, the significance of indi-
vidual creativity at the organisational level has been emphasised (Amabile, et al.,
1997, 1998). Hage (1999) examined all stages of innovation from creativity to
the implementation of the innovation process that permitted us to identify
Introduction 5
crucial factors that impact innovation activities in organisations. However,
Amabile (1997) perceived innovation and creativity as synonymous and can be
used interchangeably. According to Amabile, innovation and creativity are the
production and execution of new ideas, products and services. On the contrary,
Majaro (1988) differentiated between innovation and creativity and argued that
innovation may or may not lead to originality, whereas creativity is perceived
as a process that develops original ideas. Other researchers, such as Slappendel
(1996) noted that creativity is based on the process itself and the outcome of
novel and original ideas developed by an individual or a group of individ-
uals, whereas innovation occurs through recognising gaps, identifying oppor-
tunities or developing new solutions for challenges at work (De Jong & Den
Hartog, 2007).
As shown in Table 0.1, the authors present the evolution of innovation
theory.
Innovation Levels of Analysis

Evidently, innovation processes at different levels of organisational analysis have
not been sufficiently examined in the current literature. The following presents
innovation research at four organisational levels of analysis, which involve
innovation at the individual, team, organisational and climate levels.
Innovation at the Individual Level

The individualist perspective indicated that individuals are a major source of
innovation in organisations. In other words, individuals have the autonomy to
accomplish their goals and are not influenced by the organisation’s external
factors.This perspective postulates individual traits as antecedents to innovation.
These traits involve age, sex, academic credentials, values, goals and cognitive
style (Amabile, 1988; Scott & Bruce, 1994; Ibarra, 1993). However, individual
traits might be impacted by the organisation’s roles and position (Soreson &
Stuart, 2000; Thompson & LeHew, 2000).
Further, innovation at the individual level is a multi-stage process with a
plethora of behaviours and activities required (Scott & Bruce, 1994). These
stages were classified as ‘problem recognition’ and ‘idea generation’; ‘acquisition

of sponsorship and formation of coalitions of support’; and ‘development of a
prototype and its diffusion or institutionalisation.’ In addition, Scott and Bruce
noted that individual innovative behaviour is the outcome of four interacting
systems of individual, leader, work-group and climate for innovation. Hage
(1999) revealed that research on innovation mainly focused at innovation at an
individual level rather than at the team or organisational levels. Innovation at
the individual level, however, was based on employees’ innovative behaviour.
West and Altink (1996) indicated that innovation at the individual level,
motivation and the propensity to be safe and secure to manipulate and
explore the work environment in creative ways are two major elements that
6 Introduction
Table 0.1 The Evolution of Innovation Theory
Pre-1940s Theory Debate 1950s–1960s 1970s–1990s
Theoretically, During the mid-20th century, During this era and 30 years
businesses and new technologies, R&D after, innovation theories
private organisations and inventions were emerged in small and
consider innovation considered important for large organisations with
crucial for growing the economy the development of three
maximising profits, (Greenacre, Gross & Speirs, conceptual approaches that
and expanding their 2012). Market conditions enhanced our understanding
markets. Slater and required organisations of technological
Narver (1995) argued to innovate to fulfil change: ‘induced innovation,’
that innovation is consumers’ needs (Nemet, ‘evolutionary approaches’
vital to enhance 2007). Nevertheless, the and ‘path-dependent’
organisational perception that consumer theoretical models
performance and demand is more important (Ruttan, 2001). ‘Induced
marketing conditions. in spurring innovation and innovation’: emphasises the
However, between creativity made the world importance of changes in
the first and the overtook its predecessor. prices to perform technical
second World Wars, Both ‘technology-push’ and change (Greenacre, Gross
the classical theory ‘demand pull’ tendencies & Speirs, 2012). This
underpinning public have been heavily criticised approach assisted in the
sector delivery for being impractical, and investigation of the impact
suggested that the new theoretical perspectives of changes on economic
need for innovation support the significance of growth and the speed and
has often been both (Greenacre, Gross & execution of technical
examined due to the Speirs, 2012). They have change. ‘Evolutionary
lack of efficiency also been criticised for approaches’: stress the
in governments being incompatible with importance of past decisions
(Narver, Jacobson & challenging ideas about that may negatively impact
Slater, 1993). Briefly, networks and interactions current innovation (Foxon
the theoretical (Nemet, 2007) particularly 2003). These approaches
underpinnings of the when emphasising the are associated with various
pre-1940 private- significance of better concepts that are vital to
versus public sector feedback mechanisms current innovation theory.
provision debate between the supply and ‘Path dependency’: indicates
occurred, due to the demand sides (Foxon, how decisions tackled
need to innovate 2003). Additionally, during by organisations, systems
during the second this period, theoretical and individuals for any
World War and after approaches on innovation particular circumstance is
the war to recognise comprised fields that limited by the historical
technological illustrated the foundation of decisions already made

changes. In other innovation, and the impact even if the rationale behind
words, researchers of the organisation’s size on the decisions is no longer
needed a better the organisation’s processes relevant (Foxon, 2003).
understanding of (Xu, 2007). Solow (1957) According to Ruttan
innovation theory investigated the significance (2001), induced innovation,
to develop standards of various aspects for evolutionary approaches and
or criteria that can economic growth at the path dependency theoretical
assist governments in national level to develop a perspectives must only be
service delivery (Di better understanding of the considered as complementary
Stefano, Gambardella extent to which innovation to the advancement of a
& Verona, 2012). can contribute to the more general systems theory
economy. of innovation.
Source: Authors
Introduction 7
1980s–2000 2000–Present
Since the 1980s, innovation The evolution of innovation theory in the public
has been examined within sector is the research that outlines the significant
a dynamic system at the role of policies that promote and foster innovation
organisational level, deriving by enhancing interactions and organisational
from the interaction among structures. According to Heilmann (2008), policy
internal and external experimentation has a considerable impact on
stakeholders. During and public innovation, which often suggests innovating
after this period, researchers through implementation first, challenge traditional
on innovation revealed assumptions, and develop global rules and regulations
various definitions of later. Otherwise, an innovation is a task that an
the variable ‘innovation’, organisation has with no previous endeavours
innovation perspectives, that guarantee the desired outcomes (ANAO,
and thus, research methods 2009). Notably, one criticism for most research
in their research (Edwards, on innovation theory until recent years is that
2000). Understanding the several scholars do not reveal any evidence to the
variable of innovation actual innovative product or service, which does
has become important to not provide us with sufficient information about
organisations, as they have particular innovations. For example, Hipp and Grupp
the tendency to achieve (2005) did not indicate the type of innovation
a competitive advantage. they examined on the transferability of concepts
The concept of a ‘national from manufacturing innovation to innovations in
system of innovation’ was the service sector. Another major finding from the
first introduced in the late existing literature is that most scholars examine
1980s. A national system aspects of innovation only, such as leadership and
of innovation is perceived innovation or innovation networks (Considine
as organisational networks & Lewis, 2007). At the outset of the 21st century,
in both the public- and researchers have examined industry structure and
private sectors whose actions how it is related to the innovative development,
import, adjust and transfer particularly the differences between the different
new technologies (Freeman innovation processes. For example, ‘incremental
& Perez, 1988). Lundvall innovation’ enhances current technology with
(1988) and (1992) noted minor modifications. Large organisations can
the significance of users access sources and develop original ideas better
and producers’ interactions. through incremental improvements along the
Lundvall (1992) argued that current technologies (Foxon, 2003). According to
due to the unclear nature of Kemp and Foxon (2007), incremental processes are
innovation, such interactions major sources of progress, particularly in business
are inadequate to fulfil productivity. ‘Radical innovation,’ emphasises
market needs. significant change and provide substantial impact as

A study by Nelson (1993) a process without disrupting product delivery. By
compared the national not substituting the dominant technology or process,
innovation systems of 15 radical innovation can be considered ‘discontinuous
countries revealed that innovation’ (Bessant, 2005). ‘Disruptive innovations’
differences in innovation are frequently more risky, as it substitutes an existing
systems indicate differences product, process or technology even if it is dominant
in economic and political in a particular market. Through market saturation, an
issues and priorities across innovation can substitute an existing technology by
nations. capitalising on a new knowledge base (Schilling &
Esmundo, 2009).
8 Introduction
contributed to the psychological knowledge about innovation. Other crucial
factors to feel safe involve punishments for making mistakes, intrinsic motiv-
ation, and autonomy and control over work. These factors that promote a cul-
ture of innovation are crucial because creativity at the individual level is the
first stage in the innovation process (Amabile, 1998). Other researchers such as
McMurray and Dorai (2003) emphasised the significance of the work environ-
ment and organisational climate in promoting a culture of innovation. Similarly,
Meyer and Goes (1988) investigated innovation processes at the individual level
and concluded that leadership variables were strong predictors of innovation
processes.
Innovation at the Team Level

According to West and Farr (1989), innovation has seldom been examined at
the team level and despite recommendations that leadership was significant
to the innovation process, minimum efforts have been made to develop and
examine theoretical models (Scott & Bruce, 1994). As Van de Ven, et al. (1989)
argued, innovative ideas reconceptualise other concepts and can be considered
as ‘reinvention,’ ‘proliferation,’ ‘reimplementation,’ ‘discarding’ and ‘termination.’
Nevertheless, they suggested that the wisdom of a cumulative sequence of stages
be redefined from simple to multiple progressions of parallel, divergent and
convergent paths, some of which are related and others are not. McMurray and
Dorai (2003) indicated that the individual level is significant because the innov-
ation process begins with individual creativity. Yet the team level was included
into their workplace innovation model as a considerable mechanism during the
innovation process, which can boost the overall level of organisational effect-
iveness. Innovation at the team level or employee-driven innovation in a team
can be defined as:
A structured collection and usage of ideas and experience from most of

the employees supported and, crucially, led within a team to create radical
and incremental changes in behaviour, products, processes, services, and
business models that are valuable to customers, users, and the company.
(Kristiansen & Bloch-Poulsen, 2010, p. 156)
Innovation at the team level or ‘the interactionist perspective on innovation’

shows innovation as a process of interaction amongst several stakeholders.
The interactionist perspective emphasises the importance of the organisation’s
internal and external environment on the innovation process. Hurley and Hult
(2001) interpreted innovation as a process of interaction at different levels in an
organisation. Innovation may emerge if individual creativity takes place at the
first level, which results in group innovation or team innovation at the second
level and to organisational innovation at the third level.
The innovation process often involves the integration of various perspectives
in solving problems. Thus, teamwork could be a crucial factor of innovation.
Introduction 9
Forrester and Drexler (1999) collected essential characteristics of high-
performance project teams and suggested that these teams rarely occur by
accident. Innovative teams frequently have identifiable tasks and measurable
objectives; effective team leadership; effective balance between individual
behaviour and team roles; effective group-based conflict resolution strategies;
and constant networking with the organisation’s external environment (Tidd,
Bessant & Pavitt, 2001). Kristiansen and Bloch-Poulsen (2010) argued that it
is worthwhile to ensure that every employee can innovate despite their edu-
cational background or sector. Nonetheless, they claimed that the tendency
to innovate might be improved through dialogues, supported by an innov-
ation leader in meetings who accepts different perspectives and ideas to be
considered when evaluating the proposed innovation. Briefly, Kristiansen and
Bloch-Poulsen (2010) predicted significant challenges in employee- driven
innovation in a team. For example, developing a structured idea collection and
selection process; motivating employees to actively participate in making critical
decisions; managing a variety of ideas; receiving high-quality ideas; empowering
the right individuals to evaluate these ideas; selecting the best ideas; and ultim-
ately evaluating the performance of the innovation process.
Innovation at the Organisational Level

Public administrations are bureaucratic with traditional administrative models
that are not the best context to promote innovation (Criado, et al., 2021).
Similarly, public sector organisations are confronting tensions between innov-
ating and optimising and struggle to incorporate innovation into their per-
formance management processes and their operational processes (Gieske,
Duijn & Van Buuren, 2020). The invention stage of innovation should not only
be enhanced by policies and procedures at the organisational level but also
enhance its execution by aligning it with organisational goals (Gieske, Duijn
& Van Buuren, 2020). The primary objectives of innovation at the organisa-
tional level are boosting effectiveness and efficiency, enhancing cooperation
and coordination and the organisation’s capacity to adapt to new circumstances
(Sousa, Ferreira & Vaz, 2020). Other significant factors that are considered desir-
able to innovation at the organisational level involve training and development,
organisation of work, people’s engagement in the innovation process and the

organisation sharing knowledge.
A considerable number of studies examined management-related factors in
promoting innovation and identified the role of different organisations’ practices.
Results indicate that organisations that promote training and employee engage-
ment, job variety and autonomy, flexible working hours achieve higher levels
of innovation. Other scholars identified the significant role of management in
innovation at the organisational level in terms of transactional and transform-
ational leadership (Jung, Wu & Chow, 2008) and top management’s desirable
attitude towards innovation (Damanpour & Schneider, 2006). Previous studies
have also confirmed the relationship between top management characteristics
10 Introduction
and innovation at the organisational level (Richard, et al., 2004). Although
such findings have revealed different organisations’ characteristics, the role
of the wider context in promoting innovation remains unidentified (Phelps,
Heidl & Wadhwa, 2012). Nevertheless, Jung, Wu and Chow (2008) noted that
a decentralised management and a less formal work environment enhance
innovation. Other scholars examined the impact of micro-institutional factors
(Vermeulen,Van den Bosch & Volberda, 2007). For example, normative factors
(e.g. institution’s values and norms), regulative factors (e.g. established rules and
procedures) and organisation and innovation strategies (He & Wong, 2004) in
organisational innovation. Furthermore, considerable studies have examined
the impact of the available resources on innovation (Choi & Chang, 2009),
resource exchange (Hargadon & Bechky, 2006), resource diversity (Srivastava
& Gynyawali, 2011) and slack resources (Greve, 2003) in innovation at the
organisational level. Delgado-Verde, Martin-de Castro and Navas-Lopez (2011)
empirically investigated the relationships between organisational knowledge
assets and the innovation capability at the organisational level. Farhang (2017)
confirmed a positive relationship between 76 organisational innovation and
process innovation capabilities and between organisational innovation and per-
formance through process innovation capabilities. The significant impact of
innovation at the organisational level indicates the importance of developing
the context for knowledge creation, which is consistent with the findings of
Farhang (2017) and Delgado-Verde, Martin-de Castro and Navas-Lopez (2011)
for a positive relationship between innovation and capabilities.
Innovation at the Climate Level

The relationships between innovation and the organisations’ climate have
seldom been examined in innovation research. Several studies in the litera-
ture on organisational culture confirm this claim, such as Sorensen and Stuart
(2000), yet more studies are needed to explore how an organisation’s climate
can spur innovation in the public sector. Lopes and Farias (2020) carried out a
systematic literature review to identify the dynamics of innovation processes in
the public sector and called for further research to examine the role of organ-
isational climate that promotes innovation processes. At the organisational level,
scholars plainly suggested that specific organisation’s cultures could institute a

culture of change and innovation in specific settings (Jaskyte & Dressler, 2005);
however, it is still unclear how these organisations’ cultures enhance climates for
innovation to flourish. By contrast, Baer and Frese (2003) suggested the rela-
tionship between organisational performance and process innovation, which
was supported by high levels of climate for psychological safety and initiatives.
West (1989) revealed four factors that can promote innovation at the cli-
mate level. These were ‘vision,’ ‘participative safety,’ ‘task orientation’ and
‘support’ for innovation. Hence, innovation is supported if a vision is clear,
valued and advocated by the organisation’s members; the organisation’s
members can develop new ideas and perspectives without being criticised;
Introduction 11
and the organisation’s members are provided with all necessary support for
implementing their ideas (West, 1989). Continuous innovation and dynamic
capability theories suggested the relationship between innovation capacity and
learning (Boer & Gertsen, 2003). Both theories indicated the impact of culture
and an organisation’s climate on the ability to innovate. Additionally, Rui, Jin-
Tao and Qing-Yan (2007) addressed the relationship between capabilities and
innovation at the climate level. Nevertheless, the relationship between innov-
ation at the climate level and capabilities in public sector organisations has not
been adequately examined in different contexts in the literature.
Innovation in the Public Sector versus the Private Sector

Moore and Hartley (2008) claimed that public sector innovations differ from the
private sector in various significant ways.These involve (a) developing network-
based decision-making, financing and production systems; (b) retrieving vital
resources; (c) using the government’s capacity to specify private rights and
responsibilities; (d) redefining the rights to assess the value of what is being
produced; and (e) evaluating innovations regarding justice, fairness, commu-
nity services effectiveness and efficiency. Moore and Hartley predicted that
innovation in the public sector will continue to grow in line with democratic
governments’ agendas; thereby, a community or a society understands their own
interests and collectively addresses their goals of welfare, justice and prosperity.
Bysted and Hansen (2015) suggested that comparative studies that examine
public sector effects on innovative behaviour should analyse the influence of
industries and job characteristics. When transferring knowledge across sectors,
the authors recommended that it is crucial to comprehend conditions for
innovation in public sector organisations. Another contentious finding was that
public sector employees in the Nordic countries are not less innovative than
private sector employees, as opposed to what may be anticipated in other con-
temporary research. Bugge and Bloch (2016) noted that despite the availability
of several innovation measurement tools in the private sector, which can be
used in the public sector, it is fundamental that these tools applied in the public
sector reflect the dynamics, objectives and social characteristics of this sector.
Bugge and Bloch (2016) concluded that it is paramount to create any measure-
ment framework for various aspects and stages of innovation. Their investiga-
tion, for instance, addressed to what extent bricolage and systemic innovations
are crucial for public sector innovations and why they should be evaluated.
Roberts (2016) reported seven years of innovation in the Australian public
sector since 2009 and concluded the following: (a) Empowering change: a
framework document that permitted the development of a novel approach to
thinking and acting on innovation in the public sector; (b) the launch of the
‘public sector innovation network’ and their expansion to more than 2800
individuals around the world; (c) the launch of a blog in 2010 and the rest of
the toolkit website in 2011; (d) the development of innovation week, which
became innovation month; (e) the trial of the ‘innovation hub’ and the selection
12 Introduction
of two ideas for further development by the ‘innovation champions group’;
(f) the development of the ‘public service innovation awards’ in partnership
with the Institute of Public Administration Australia; and (g) the publication
of the first ‘innovation snapshot,’ offering an overview of some of the many
innovative endeavours happening across the Australian Public Service (APS).
Nevertheless, Roberts noted that this is not a comprehensive snapshot and
there are numerous endeavours that have been launched in the Australian
public sector. Several government organisations are developing innovation hubs
to gather novel ideas from users of public services (Liddle & McElwee, 2019).
Thus, innovation is considered vital to the future of public services rather than
top-down hierarchies that control processes (Liddle & McElwee, 2019).
It is evident that annual reports provide significant amounts of informa-
tion about government departments and agencies on the public record.
Hence, annual reports are considered crucial to the parliament, academics and
practitioners as the comprehension provided assist in the performance appraisals
of these departments and agencies, as well as the management of government
programmes in Australia. The following attempts to identify how government
departments in Australia consider innovation in their organisations. The APS
commissioner Podger (2004) considered three significant themes under ‘innov-
ation with integrity’ to confirm that services continue to achieve their role
based on Australia’s democratic system of government with integrity, profes-
sionalism, commitment and high performance that have normally been its features
throughout the history.The three themes involved are (a) promoting leadership
that supports innovation not only to help agencies’ business outcomes, but also
in working across various organisational boundaries; (b) enhancing sustain-
ability in APS leadership capability; and (c) supporting integrity by safeguarding
and enforcing the APS values.
O’Connor, Roos and Vickers-Willis (2007), at the Department of Treasury
and Finance, a Victorian (Australia) public policy organisation, offered new
approaches for developing the capacity to innovate for government policy
organisations. These involved: (a) ‘cultural build-up’ for promoting innovation
capacity; (b) senior management staff involvement and innovation sponsors,
yet despite employees’ tendency to be innovative, they have not yet seen it as
acceptable; (c) differences in innovation thinking and the organisation’s capacity
to innovate; and (d) initiatives to promote the implementation of new ideas and
perspectives. At the Department of Industry, Science, Energy and Resources
(2019), it is noted that innovation would not flourish unless an idea is realistic
and practical. In addition, the Department of Treasury and Finance offers ‘the
innovation development early assessment system (IDEAS)’ to evaluate the value
of a particular project or an idea and to assist public servants with evaluating
their ideas. This method is developed through standardised evaluation criteria
that aimed at conducting an early assessment and recognising novel ideas that
are valuable.
Introduction 13
At the Australian Department of Human Services (2016), innovation is
promoted through efficiency (e.g. reducing red tape, while enhancing effective
services and delivering desirable outcomes), an effective information and com-
munication technology (ICT) environment to enhance digital access to their
services and supports efficient and flexible responses to government priorities.
Hence, a culture of sharing and collaboration is promoted at all levels through
a constant search for strategic partnerships and networking with non-profit
organisations to enhance the quality and the delivery of government services.
The culture is also enhanced through new service techniques that foster integ-
rity and accountability, while recognising and supporting individuals who have
the capacity to innovate, and improving financial processes to facilitate the con-
stant transformation of services and support government agendas and priorities.
At the Department of Education and Training (2014–2015), various strat-
egies were applied to enhance their workforce management and employee
engagement. For instance, this is demonstrated through an ‘internal mobility
register’ that allows staff to express their interest in moving both within and
outside their department and creating an attendance management toolkit to
maintain a good attendance culture in the organisation. Additionally, in the
‘National Innovation and Science Agenda’ (2016), four critical pillars are
considered: Culture and capital provide new tax systems to minimise discrimin-
ation against entrepreneurs who are taking risks and innovating. Collaboration
modifies financial incentives to support universities and allocate more research
funds through partnership with industry. Talent and skills support all Australian
students to adapt to the technological era and develop the visa system to bring
more talented individuals from diverse cultural and linguistic backgrounds.
Finally, Government as an exemplar means leading by example through free access
of data to the public to allow entrepreneurs and small businesses to do business
with the government. At the Department of the Prime Minister and Cabinet
(2016), the organisation’s culture supports healthy debates, values individuals
with new ideas and perspectives and advanced critical thinking skills. Thus, a
culture that respects and accepts different opinions is fundamental. Additionally,
values such as integrity and humility are crucial at the department, which is
committed to the best outcomes for Australia.
At the Australian Public Service Commission (APSC) (2011), public-and
private sector representatives have collaborated to tackle critical management

challenges and evaluate practical solutions. These involved (a) better perform-
ance through coaching and increasing employee engagement levels within
organisations; (b) gender equality tackled through raising individuals’ level of
awareness, networking and creating an effective environment; (c) boost infor-
mation sharing among individuals in the internal and external environments
by recognising any posts, job swaps and exchange of ideas; (d) remove barriers
associated with hierarchical structures by developing appropriate communi-
cation platforms to enhance relationships among staff; (e) promote flexible
14 Introduction
jobs to promote flexibility, which lead to workplace innovative behaviour and
productive APS; and (f) compete with the private sector for talent through
exchange programmes to boost the percentage of mid-career talent across
the APS.
Antecedents of Innovation
Several factors have been constantly considered to facilitate innovation at
different levels in organisations (Anderson, et al., 2004). Despite a consider-
able amount of research that examined innovation at the individual, team and
organisational levels, little has been done on the impact of innovation at the
climate level (Moussa, 2021a). Figure 0.1 shows the antecedents of innovation.
However, the authors do not claim this overview to be exhaustive; instead, Figure
0.1 provides the delimitations of innovation at different levels in organisations.
Oversights in Innovation Literature

Rana, et al. (2014) indicated that most research on innovation in the public sector
are conceptual in nature. Rana and colleagues reported that the findings can be
classified in six critical aspects, as follows: demographic characteristics; keyword
analysis; theory/model/framework analysis; research methodology analysis; lit-
erature review of innovations in public sector organisations; and limitations in
the existing literature and propositions development.This suggested that despite
extensive academic research on innovation, there is a lack of primary data-based
quantitative research, a lack of theory/model/framework implementation in
the existing literature, particularly, in the context of the less-developed nations.
De Vries, Bekkers and Tummers (2016) and Moussa (2021b) found that the
majority of the studies on innovation in the public sector applied qualitative
methods, such as interviews or focus groups. Quantitative research and par-
ticularly mixed-method studies were less common. It is found that innovation
was often insufficiently conceptualised, while the main body of knowledge is
focused on internal-driven, often administrative process innovations.
Moreover, outcomes are frequently not revealed, limiting our ability to
comprehend the effects of innovation endeavours. Other findings include
(a) the dearth of clear theoretical propositions in the studies examined; only
few research indicated the existing theories on the diffusion of innovations
in organisations; (b) only a small number of scholars are frequently cited; and
(c) to date, empirical research did not explicitly reveal what happens after
innovations are implemented in organisations. The study of organisations’
innovation has revealed indecisive and insufficient findings, as well as incon-
sistent and low quality of explanations of innovation processes (Edwards,
2000). Furthermore, the Crossan and Apaydin (2010) framework involved two
sequential factors: innovation, as a process (how?) and innovation, as an out-
come (what?). The why? question is not adequately addressed in the literature
and has not been adequately investigated.
Introduction 15
Innovation at Types
Different Levels
1.Creativity 2. Self-leadership
3.Knowledge management
Innovation at the Individual Level
4.Constructive culture
Innovation at the Team Level 1.Leadership Characteristics

2.Work Group Characteristics
Innovation at the Organisational

Level 1. Work Organisation
Innovation at the Climate Level 1. Environment
Antecedents
1. Creativity (Shalley & Gilson, 2004; Pratoom & Savatsomboon, 2012).

2. Self-leadership (Carmeli & Schaubroeck, 2007; Pratoom &
Savatsomboon, 2012).
3. Knowledge management (Tongboonrawd & Sukpradit, 2007).
4. Constructive Culture (Pratoom & Savatsomboon, 2012).
1. Leadership Characteristics: Participative Leadership (Axtell, et al., 2000;

Kanter, 1984); Transformative Leadership (Janssen, 2004; Shin & Zhou,
2003); Leader-Member Exchange (Scott & Bruce, 1994;1998).
2. Work-Group Characteristics: Support for Innovation (Scott & Bruce,
1994); Evaluation metrics (Shalley & Perry-Smith, 2001).
1. Work Organisation: Little Rules and Procedures (Oldham & Cummings,

1996); Innovation Strategy (De Jong & Den Hartog, 2007); Adequate
Resources (Brand, 1998); Reward System (Eisenberger & Armeli, 1997;

Baer, Oldham & Cummings, 2003); Creativity (Leonard & Swap, 2005).
1. Environment: Competitive Environment (Ong, Wan & Chang, 2003);

Type of Industry (Ong, Wan & Chang, 2003)
Figure 0.1 Antecedents of Innovation at Different Levels.

Source: Authors.
16 Introduction
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The Introduction To Innovation in The Public Sector

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See discussions, stats, and author profiles for this publication at: https://www.researchgate.

Chapter · August 2022

Mahmoud Moussa Leonie Newnham

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Adela Mcmurray Nuttawuth Muenjohn

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Definitions and Types of Innovation

different scholars. Although various studies examined innovation in the public

measurable factors that characterise workplace innovation. Moreover, Martins

organisational level (Knight, 1967). Radical innovations flourish through the

Innovation and Creativity

1994). Accordingly, the main source of innovation in organisations is individ-

Innovation Levels of Analysis

Innovation at the Individual Level

stages were classified as ‘problem recognition’ and ‘idea generation’; ‘acquisition

Pre-1940s Theory Debate 1950s–1960s 1970s–1990s

technological illustrated the foundation of decisions already made

market needs. significant change and provide substantial impact as

Innovation at the Team Level

A structured collection and usage of ideas and experience from most of

Innovation at the team level or ‘the interactionist perspective on innovation’

Innovation at the Organisational Level

organisation of work, people’s engagement in the innovation process and the

Innovation at the Climate Level

scholars plainly suggested that specific organisation’s cultures could institute a

Innovation in the Public Sector versus the Private Sector

private sector representatives have collaborated to tackle critical management

Oversights in Innovation Literature

Innovation at the Team Level 1.Leadership Characteristics

Innovation at the Organisational

Innovation at the Climate Level 1. Environment

1. Creativity (Shalley & Gilson, 2004; Pratoom & Savatsomboon, 2012).

1. Leadership Characteristics: Participative Leadership (Axtell, et al., 2000;

1. Work Organisation: Little Rules and Procedures (Oldham & Cummings,

Resources (Brand, 1998); Reward System (Eisenberger & Armeli, 1997;

1. Environment: Competitive Environment (Ong, Wan & Chang, 2003);

Figure 0.1 Antecedents of Innovation at Different Levels.

Integration of Institutional and Collective Dynamics”. Journal of Applied Psychology,

Iranian Journal of Optimization, 26(5), pp. 405–​417.

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Figure 0.1 Antecedents of Innovation at Different Levels.

Iranian Journal of Optimization, 26(5), pp. 405–417.