The platform as the prototype
Should the state copy big tech — or should we invent something new?
There’s a moment in Peter Drucker’s 1970 book, Technology, Management and Society, where he discusses what we can learn from business management for the way public bodies are run.
Drucker writes that we can’t just transfer all the lessons of business management and apply them to the way we run non-business institutions.
On the contrary, the first thing these institutions have to learn from business management is that management begins with the setting of objectives and that, therefore, non-economic institutions, such as a university or a hospital, will also need very different management from that of a business. But these institutions are right in seeing in business management the prototype. What we have done in respect to the management of a business we increasingly will have to do for the other institutions, including the government agencies. Business, far from being exceptional, is, in other words, simply the first of the species and the one we have studied the most intensively. And management is generic rather than the exception.
This all raises an interesting question: when the state is learning from business, where should we stop? What should be similar about the organisational forms/processes we apply in business and the ones we apply in the public/charity sectors, and what should be different?
This is not an academic point. After all, Drucker was basically right that business management and the corporation came to be a prototype for the way public bodies are run. Over the twentieth century, as the form of the modern corporation rose to dominate the business world, bodies like universities, hospitals, and charities followed suit. With some light touch translation through intermediary disciplines like public management theory, they aped business’s practices and institutional forms.
This was partly about adopting organisational structures and processes: managerial hierarchies and waterfall governance. But it also meant adopting a deeper philosophy. Lots of non-business organisations came to interpret their work through an analogy with profit-optimisation; they went looking for measures that could play the same function as profit plays in a business. As Drucker wrote in 1970, “non-economic institutions need a yardstick that does for them what profitability does for the business.” Public bodies were like companies chasing something other than profit.
So, during previous technological transitions, business functioned as a kind of institutional prototype; the corporation was the mould in which we recast the state and civil society.
All of which is really pertinent today, now that an analogous transition is underway. The corporation is being replaced by the digital platform as society’s dominant institutional form. And, to borrow Drucker’s words, this transition is once again being led by the private sector as the “first of the species”, with the platform business model being the institutional form “we have studied most intensely”. The default outcome is therefore that the platform, as the institutional form adopted by business, will now become the mould in which we cast digital-era public bodies.
Sure enough, non-business organisations now see the digital platform as an aspirational form. Already one of the main dynamics we’re seeing in public life is the (slow and painful) attempt to reimagine public bodies as platforms, with the most explicit statement of this intent being the idea of ‘‘government as a platform”.
More concretely, front-running charities and public-sector bodies are adopting elements of the platform operating model. They’re shifting to product teams as the unit of delivery, adopting iterative planning processes, and starting to use outcome-based performance architectures like OKRs.
It might sound like I’m building up to say this is all a big mistake. But actually, broadly speaking, I think this is right.
There’s a reason the platform has emerged as a newly dominant form in the private sector; it’s an institutional innovation that makes the most of today’s frontier of technology, just as the managerial corporation did for mass production.
So it would be strange, and arguably negligent and dogmatic, if public bodies and charities did not adopt these ways of working. In fact, my personal view is that the slowness of this adoption, due to inertia and conservatism — not to mention an increasingly unforgivable lack of understanding of technology from politicians and public sector leaders — explains or at least exacerbates lots of today’s greatest social injustices. It creates the queasy situation in which society’s most advanced organisational methods are being used by big tech companies to do trivial things like make videos of cats go viral, while the same methods are not being used to do things of deep social value, like helping people feel less ill or lonely or depressed.
So to my mind the first takeaway prompted by Drucker is that the platform is too powerful a model to be left to the business sector.
But the second takeaway is that we need to take that follow-on question seriously: what aspects of the platform, as applied in business, are not appropriate for public bodies and charities? Or, put another way, which aspects of the platform model are “generic”, in the way that some modern managerial practices were generic, and which aspects are particular to business, and harmful if adopted by public bodies and charities? How much customisation is needed?
I don’t know the answer to this question. But having led digital teams in a big charity for quite a long time, I do have some hunches about the aspects of the platform model that we might want to customise, or even leave behind entirely, in public/charity sector work.
1. The tone and texture of relationships
I think we should resist the temptation to reduce service users to customers, which is a mental model that can easily hitch its way into our thinking via the platform approach. It feels like there’s something special and essentially human about the relationship implied by the word citizen, or about how it feels when a person working for a charity helps another person just because they feel empathy for that person and think that helping them is the right thing to do. And when it comes to the relationships that public bodies and charities have with the people who use their services, I think we should remember that quality — not in the sense of calibre, but in the sense of tone and texture — matters as much as quantity.
2. The limits of optimising
In general I think charities and public bodies need to get much better at using live data to drive service improvements. Most public bodies and charities are 20 years behind what’s possible. But I also think we should be very careful when we optimise with data. We should remember that what gets measured gets done, and that some things — compassion, agency, esteem — are inherently difficult to measure, and that these things are therefore systematically undervalued when we optimise with stats. We should also remember that these hard-to-measure things are precisely what makes public bodies and charities valuable; in fact, the systemic under-valuing of these things by the business sector — partly because they optimise with data — is what creates the need for public bodies and charities in the first place. So we should be careful not to adopt these same methods unthinkingly.
3. The importance of place
We should remember that some important aspects of life are lost or downplayed by the logic of platforms. Place is an example, but there are probably others. Platforms are powerful (and profitable) because they are abstract and therefore scalable. But lots of the joy of life comes from specificity. An example is the particular flavours of specificity that are inherent to place: locality, familiarity, community. So we should be careful not to diminish aspects of life like place in the transition to a platform-based society (and we should also keep our eyes on other valuable but platform-unfriendly aspects of life, like physicality or sanctuary/privacy). In fact, maybe one role for the state and charity sector in the platform is to be the guardians of these aspects of life, and to develop new types of platform that are conducive to their enrichment.
Those are just some early thoughts. I’m conscious that lots of people are doing fascinating work in these areas (I’d love to read relevant things if you want to share them under this post or on Twitter).
I guess I have two main conclusions. First, when we apply the mental model of ‘government as a platform’, or ‘charity as a platform’, we’re onto something really important. If anything, we should push harder in this direction. But also, second, when we do this work we should be careful not to see the business platform as the prototype. We will need new species of platform (sorry, ugly phrase) to reflect each sector’s unique value and to equip us for the work to be done.
This post is part of a year-long series on how we govern the future. To read along, follow me on Medium here or support the project for £3 a month on Substack. For the big story behind all this, the paperback of End State is out now.
