Mikko Martikainen

Mikko Martikainen

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  1 Service design conference,Kuopio 7.9.2009 Mikko Martikainen Ministerial Adviser Ministry of Employment and the Economy mikko.martikainen@tem.fi Ladies and gentlemen, dear foreign quests Services and service development is a very topical issue. This is no surprise because modern economies are more and more service economies. Rather, it would very strange if service development and service innovation would not be at the very heart of economic policy and innovation policy discussion. This is also the case here in Finland. The new Finnish Innovation Strategy emphasis the need to include services more to the innovation policy framework. It recognises that services are 75 percent of the Finnish economy, but their productivity is trailing industry’s productivity. The need to increase productivity is acute in both the public and private service sectors. One of the main points made in the Innovation Strategy is that the concept and thinking of innovations should be a broad one. Finland has a long and successful history in technology development but it is now recognised that this is not enough anymore. We need service skills and knowledge and service innovations together with technology. Innovation concept should be broadened to include 7.9.2009
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  2 business models, services,service solutions, design, branding, management and organisational innovations. In this respect this seminar is also giving a valuable contribution to the discussion on service development and to the future direction of Finnish innovation policy. ************ I would like to take this opportunity to discuss a bit more about the urgent need to renew public services. There is a clear apprehension that if nothing is done public services can become a burden part for the rest of the economy and well-being of citizens. There are two reasons for this: First, the present financial crises and economy slow down puts great pressure on public finance. This happens at the same time with the ageing of Finnish population and the succeeding increase in the demand of public services. Financial crises, pressure to increase taxation and rising demand for public services make us look at the public service innovations and public service productivity more seriously than ever before. Innovations in public services play a critical role in keeping taxation within tolerable limits. If the productivity of public services continues to trail that of the rest of the economy public services may became a burden for the rest of the economy. 7.9.2009
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  3 Second, there isgreat disappointment among citizens towards the way public services are provided. According to recent study citizens are discontent with the present way of providing public services: o over 75 percent feel that the present way of providing services does not meet their expectations and needs o 85 percent feel that it is irrelevant who produces the services as long as the services are of high quality o 85 percent feel that they should have more choice over the producers of services o 85 percent see that they can best decide what services suit their needs and what they need These results indicate – regardless of basis of the critic: specific personal experience or just general unspecified discontent - that the public services are not meeting the expectations of citizens or at least people have “second thoughts” of the working of the system. In the worst case citizens will loose faith on the public services and services will start to look more and more as a burden from the citizen point of view. Then the challenge is the following: if the large middle class, the main source of tax revenues, revokes its support of the public service system, the whole public welfare system will be in deep trouble. ************** Services need to be rethought and the new perspective must be the citizen perspective. Service Design feels like a very attractive idea and a useful tool in this process. It brings citizens to the limelight. Services are designed around citizens. Citizens are engaged and their 7.9.2009
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  4 needs and hopesare passed to the service producers. Services are provided through modern co-ordinated delivery channels where both the public actors and private sector actors work together producing high quality public services. Resources (common planning, common infrastructure, common data) are shared and used optimally when departmental barriers are broken. But this needs changes in the way public sector organisations work and think. Public sector role will change more towards a managers role, where emphasis is on service chain management and taking care of the service entity. This demands new skills: planning, delivery, management, team working skills etc. This change also demands a new attitude towards the private sector. Private sector and markets must be seen as an equal partner who can bring new innovations to the development and production of public services. We must be ready to combine public capabilities whit the market and private sector capabilities. ************* Dear conference participants, I am sure this conference will help us see more the possibilities service design gives us and I wish you all a very rewarding conference and stay here in Kuopio. 7.9.2009