Public Organizations and Business Model Innovation: The Role of Public Service Design

Public Organizations and Business Model Innovation: The Role of Public Service Design

Mateusz Lewandowski (Jagiellonian University in Kraków, Poland)
DOI: 10.4018/978-1-5225-2215-7.ch003
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Abstract

Improvement of public services and raising the citizens' quality of life is one of the biggest concerns of public sector. Changing the way public organizations operate could support such an improvement. In this regard, business model framework is an emerging field of research that could shed some new light. Yet, in case of public organizations, business model innovation remains heavily underexplored. The purpose of this chapter is threefold, to indicate and discuss the opportunities of adapting the business model innovation theory to public organizations, to conceptualize its theoretical framework, and to explore the role of public service design in the process of innovating public sector business models.
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Introduction

Governments, authorities and all other public sector organizations pursue the ideas how to improve public services and raise the citizens quality of life. In this regard the researchers and practitioner of public management recognized innovation as significant driver to improve performance of delivering public services (Hollanders et al., 2013; Hughes, Moore, & Kataria, 2011; Innobarometer 2010 Analytical Report Innovation in Public Administration, 2011). Although, there are various types of innovation in the public sector (de Lancer Julnes, 2016; Lewandowski, 2015), one of the most recent research area is innovation pertaining to the business model (Zott, Amit, & Massa, 2011a). Yet, it remains underexplored not only in the business sector organizations, (Zott et al., 2011a), but, as Julnes, Gibson, and Park (2016) implicitly predict, also in the public organizations. Thus, there is a need to investigate business model innovation in the public sector.

The main aims of the chapter are: (1) to indicate and discuss the opportunities of adapting the business model innovation theory to public organizations, (2) to conceptualize the theoretical framework of business model innovation for public organizations, and (3) the role of public service design in this the process of innovating public sector business models.

The chapter is structured as follows. The background section outlines the specificity of business model innovation as a research field located on the overlapping area of its two baseline theories: innovation theory, and business model theory. Then, according to the same scheme, the third section investigates the construct of public sector innovation, and public sector business model. Its main output – the General Framework of Public Sector Business Models - is then used to conceptualize how public sector business models may be innovated. The final point is made in the fourth section, where Public Service Design is presented through the lens of public sector business model as an important strategy to increase citizens quality of life. In the end conclusions summarize the main findings.

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