Collaborative innovation in a local authority – ‘local economic development-by-project’?

ABSTRACT

This paper analyses how local authorities address the challenges of prolonged austerity by making use of collaborative innovation, financed through bidding for instrumental technology-based projects. Based on two case study projects within a local authority in England, analysis shows how local authority managers change their role, from brokers before and during bidding, to institution-builders during implementation, and networkers when attempting to capture long-term value from the projects. The findings also highlight the limits of this approach, as the limited nature of the projects makes it difficult for local authorities to capture long-term value, especially if there is no follow-up funding.

KEYWORDS:

• collaborative
• innovation
• local economic development

Introduction

This paper explores mechanisms by which local authorities in England are attempting to promote local economic development in the face of multiple challenges to their resources, capacity, and powers. Specifically, the paper analyses how local authorities are attempting to promote local economic development in the context of prolonged austerity by making use of collaborative projects financed through competitive funding bids for instrumental, technological innovation.

Local authorities are the most stable institutions in sub-national governance in England, having survived successive reforms of regional governance (Pike et al. 2016). However, they have also bore the brunt of governments’ budgetary austerity from 2010 onward, with some estimates suggesting a 28.6% reduction in local authority spending power from 2010 to 2018 (National Audit Office 2018), even as demand for such services have continued or grown (Leslie and Canwell 2010). As a result of these pressures, local authorities have seen their ability to finance non-statutory spending severely curtailed – including the promotion of local economic development. Short of capacity, funding, and legal instruments with which to promote local economic development, local authorities have turned to engaging a growing number of stakeholders (such as businesses, universities, NGOs, or civil society groups, amongst others), making the promotion of local economic development a negotiation among different partners and priorities.

Funding mechanisms include business innovation and grant funding competitions. Funded by the government¹ or European Union² , these competitions offer funding and support to consortia of stakeholders across industrial sectors, the public sector, civil society, and academia. Funders define what specific areas of business innovation, research, or sectors they intend to fund through Open Calls, and the competing consortia bids for available funding³, with the winning consortia funded. For business innovation competitions, local authorities cannot, in general, lead the consortia, but are often a key part of it. In contrast, some competitive grants are directly aimed at local authorities, with a view to promoting the deployment of technologies. In all cases, local authorities need to be a part of consortia which include relevant stakeholders with the knowledge and experience required by the funding call. Local authorities are then involved in the co-ordination and delivery of the funded project, in accordance with the roles specified in the brief. We have termed this practice ‘local economic development-by-project’.

To function as a plausible mechanism for the promotion of local economic development, local economic development-by-project requires the local authority’s economic development officers to operate in collaborate with a raft of stakeholders, before, during and beyond the funded programmes. Based on two nested case studies of such projects in a local authority in England, this paper analyses the strategies employed by the economic development officers before and during the bidding, once funding is secured, and beyond the scope and timeline of the funded projects. Before and during the bidding, local authorities act as brokers, aligning the interests and priorities of funders and stakeholders to produce the funding bids. Once the funding is secured, the local authorities’ work focuses on institution-building, implementing the strict management and control processes required by the funders. But local authorities can also make use of the project beyond its scope and timeline, using it to build networks with other stakeholders to promote local economic development in their area, and applying for follow-up project funding.

This paper makes two contributions. The first, an empirical contribution, demonstrates how local authorities in England have adapted to the context of austerity, specifically in terms of actions taken to promote local economic development. The findings suggest that local authorities can focus on aligning development priorities, funding streams and local partners, and developing networks of stakeholders around shared interests and funded projects. As a result, local authorities have come to serve as brokers of collaborative innovation. However, the findings also highlight the limits of this approach, as the strictly limited scope and timescale of the projects means it is very difficult for the local authority to capture long-term value for their area, especially if there is no opportunity for follow-up projects. Second, the paper provides a conceptual contribution, in its analysis of the ways in which collaborative innovation is instituted and managed via local authorities. The findings demonstrate that local authority managers change their role according to the phase of the project; from brokers before and during the bidding process, to institution-builders during the implementation phase of the projects, and to networkers when attempting to capture long-term value beyond the scope and timeline of the project. These different activities are often at tension with each other, and the networks are strongly dependent on specific individuals.

The paper is organized as follows: The second section presents the conceptual framework, by reviewing the concept of collaborative innovation in public management, and key models of instituting innovation in public services. Following this, the paper describes the research context and approach, as well as the specific project case studies that the local authority supported. This is followed by the findings of the study and discussion and conclusions.

Conceptual framework – collaboration and innovation in public management

Innovation

Innovation is a key concept in management that has long been considered as a driver of growth and productivity in the private sector. It involves the development and implementation of new ideas and practices, that problematize and transform the way that things are usually imagined and done (Torfing 2019; Wegrich 2019). The persistent focus on private sector innovation and the development of new technologies has often obscured other forms of innovation which apply to public management. Compared with the substantial track record of private sector innovation research, interest in public innovation remains relatively new with public innovation at times regarded as something of an oxymoron (Torfing 2019; Bommert 2010). Inherent structural and cultural norms within the public sector associated with hierarchy over collaboration, and bureaucracy over creativity, have long been regarded as barriers to innovation, although these stereotypes are being dispelled by increasing examples of public innovation in practice (Torfing 2019). In public management, innovation differs from a product-centric view seen elsewhere, given the intangibility of public services, and the fact that production and consumption of those services often occurs simultaneously (Ramsdal and Bjørkquist 2019). Innovation in public management has the potential to tackle wicked problems (Geuijen et al. 2017; Chen, Walker, and Sawhney 2020), for example by producing new ways of doing things which are often collaborative and include a variety of internal and external actors in the innovation cycle.

Collaborative innovation

Eggers and Singh define collaborative innovation as a governing arrangement which ‘utilizes the innovation assets of a diverse base of organizations and individuals to discover, develop, and implement ideas within and outside organizational boundaries’ (2009, 98). As public sector organizations have lost funding and regulatory authority through successive reforms (Balz and Zonneveld 2015; Pike et al. 2015), collaboration with other actors has come to be seen as a mechanism to overcome organizational and societal challenges through the creation of interorganizational networks that spur innovation through cross-sector collaboration (Hartley 2005; Osborne 2010; Torfing 2019). Collaborative innovation aims to promote a trust-based and constructive exchange of knowledge, ideas and competencies between actors from across the public and private sectors. Different perspectives stimulate processes of mutual learning, that improves the understanding of the problem and cross-fertilizes the range of creative ideas to solve it (Roberts 2000). These solutions are implemented through joint ownership and resource exchange to optimize available resources (Sørensen and Torfing 2011), sharing costs, risks, and benefits (Sørensen and Torfing 2011; Torfing 2019).

Within the field of local economic development, the creation of collaborative, multi-actor networks (including Local Enterprise Partnerships and Combined Authorities) is promoted by central government as a means to address productivity challenges and promote growth. In other policy spheres, there are further examples of networked government in which the provision of public services has been improved through the interaction of multiple actors (Osborne 2006; Bommert 2010). Collaborative innovation encourages public sector organizations to think outside of bureaucratic silos (Torfing 2019) and focus their attention beyond the co-ordination of their specific policy programmes and public services. The trend towards a more collaborative approach is connected to the shifting paradigms and funding regimes of public administration management, which over time have encouraged a move away from the bureaucratic towards the innovative, entrepreneurial, and collaborative. Whereas New Public Management tended to view public monopolies as the key problem and the enhancement of market-based competition as the preferred solution, New Public Governance views societal complexity as the key challenge which requires new innovation strategies (Hartley, Sørensen, and Torfing 2013; Jiyao, Walker, and Sawhney 2020). How these actors view themselves and their roles will affect their inclination to participate in collaborative innovation processes (Torfing 2019). If they perceive their role as bureaucratic rule-followers who adhere to professional standards they are unlikely to have an interest in collaborative innovation, whereas those who identify with a more entrepreneurial role and see themselves as facilitators, enablers and mediators are more likely to participate in collaborative innovation processes (Bovaird 2007; Torfing 2019).

Existing literature identifies several factors that are claimed to support the process of collaborative innovation. A diverse range of actors must establish a relationship of trust and empathy that enables the mutual exploitation of differences to innovate and create value (Torfing 2019). All actors should possess a series of personal ‘collaborative competences’ that include reflexivity, flexibility, open-mindedness, and communicative skills (Williams 2012). However, managers across the network will enact different kinds of authority, and bring a diverse range of experiences, skills and competences (Ansell and Gash 2012; Williams 2012; Hartley, Sørensen, and Torfing 2013; Crosby, Hart, and Torfing 2017). As such, collaborative innovation requires leadership to be distributive, horizontal and adaptive. with actors fulfilling a variety of roles (Crosby, Hart, and Torfing 2017). Public managers in this role should be ‘orchestrators of networked interaction and mutual learning’: acting as conveners, stewards, and catalysts of collaborative innovation (Crosby, Hart, and Torfing 2017, 656). Whilst rarely the principal leader in the creative process, they fulfil an essential role in bringing together relevant partners, and facilitating the exchange of information and ideas, to induce a trust-based interaction (Ansell and Gash 2012; Torfing and Triantafillou 2016). This presents a challenge for public managers to shift away from the ‘routines of government’ to the complexity of dispersed leadership of a multi-actor collaboration (B. Gray 1989). Skill is required to avoid reverting to familiar bureaucratic organizational models that favour rigid controls and vertical hierarchy (Agger and Sørensen 2018), and risk falling into collaborative inertia (Vangen and Huxham 2005).

Despite the growing body of evidence supporting collaborative innovation in public management, questions remain about the role played by local authorities in those contexts; whilst there is significant focus on how best to promote collaborative innovation in public services, less attention is paid to the mechanisms by which governance and institutional innovation emerge (Torfing 2019). As Crosby notes, much of what is written is a ‘normative exercise, a window on what might be, why it matters, and some first ideas on how it might be brought about’ (Crosby, Hart, and Torfing 2017, 666). Collaborative innovation has the potential to provide better public outcomes in public services, but to deliver on those outcomes, the innovations to such processes need to become instituted, and applicable to new circumstances (Toivonen, Tuominen, and Braz 2007), otherwise they constitute only momentary adjustments. It is thus imperative to explore the ways in which innovative processes become instituted in public management spheres.

Collaborative innovation in the public management of local economic development in England has resulted from significant changes to the powers and resources of local authorities in this arena over the last four decades. first, the ‘communicative turn’ or ‘collaborative turn’ in planning’ (Healey 1992; Balz and Zonneveld 2015), whereby local authorities saw their legal authority to directly plan and implement economic development policies reduced, whilst concurrently being encouraged to engage with civil society as ‘equal’ stakeholders. Second, the reform of regional government has reduced the remaining bodies’ ability to devise and implement policy (Pike et al. 2015). Third, since 2010 the availability of public funding for local economic development has been substantially reduced (Hastings et al. 2015; Meegan et al. 2014). Between 2010/11 and 2017/18 there was a 49.1% real-terms reduction in government funding for local authorities, which translated into a 28.6% reduction in local authorities’ spending power in real terms (National Audit Office 2018). Diminished funding has not been met with reduced demands; English local authorities have seen growing demand for social services, including adult social care, in part due to demographic pressures (e.g. Gardner 2017; Leslie and Canwell 2010). Figures suggest that ‘discretionary’ spending within local authorities’ Planning and Development Services – which includes the promotion of local economic development – saw a reduction of 53% between 2010/11 and 2016/17 (Gray and Barford 2018, 558). But despite these challenges, local authorities remain the most persistent form of sub-national governance in the country. Collaborative innovation has provided an avenue to continue to promote local economic development under prolonged austerity.

Instituting collaborative innovation in public management

Innovations cannot be limited to the process of producing new ideas. Changes to a process or system need to become ‘ … implemented in an organization or accepted at the market or in society’ to be considered an innovation (Fuglsang 2010, 67). This process can be characterized as instituting cases of collaborative innovation – turning them into a routine part of the functioning of public management. If the positive impacts of change are to be captured, then that change needs to be internalized and used subsequently. The literature suggests there are three mechanisms by which the process of instituting innovation in public management takes place. First, there is a top-down approach, whereby local authority managers determine which initiatives will take place, based on an abstract interest. In this model, managers appear as policy entrepreneurs (Catney and Henneberry 2016) who challenge the way in which processes have been historically instituted (Andersen 2008); the innovation is instituted through the legitimacy of the manager (Ramsdal and Bjørkquist 2019). Second, innovation can take place through a bottom-up approach, utilizing knowledge and social capital present in the organization (Andersen 2008). These innovations are often characterized by street-level operatives engaging in practice-based ‘tinkering’, also known as bricolage, whereby small and interactive adjustments are eventually adopted as new practices and routines. Finally, innovation can result from interaction between managers and operatives at street-level, combining top-down legitimacy and bottom-up bricolage, where officers attempt to find new solutions for problems to respond to a management-initiated demand. In these cases, public managers are explorers and officers work as co-producers of the organizational structure (Ramsdal and Bjørkquist 2019).

These three mechanisms of innovation production are not mutually exclusive. In fact, they can co-exist in organizations, each gaining importance according to the context (Fuglsang 2010; Ramsdal and Bjørkquist 2019). This paper now analyses how one local authority adopted one or more of these roles, in the context of consortia designed for collaborative innovation.

Research context and approach

Research context and cases

The context for the research was an evaluation project of Coventry City Council’s (CCC) local economic development projects in the low carbon transportation sector, with the objective of learning lessons for future projects. In order to understand how collaborative innovation takes place in the context of local economic development, a case study approach was used, in order to provide an in-depth analysis of phenomena based on a range of evidence (Yin 2018). The research design comprised two embedded case study projects, funded and delivered independently of each other. This nested (or embedded) case study design has the potential to provide a robust setting comparison, by separating the ‘case-for-the-case’ analysis from the cross-case analysis (Chong and Graham 2013). This allows the context to be foregrounded, providing an explanatory lens for why given approaches may have different consequences in different projects.

In collaboration with stakeholders in the Council, two cases of economic development projects were investigated: The Electric Taxis project and the UK Autodrive project. The cases were selected on the basis that they constituted typical examples of local economic development projects in which the local authority normally participates as a stakeholder. This case study design follows Yin’s description of a single common case study (Yin 2018, 50), the objective of which is to capture the conditions, processes and circumstances of an everyday situation, and extract lessons from the social processes associated with collaborative innovation. In essence, the two projects were chosen because they were representative of how CCC collaborates with partners to produce and deliver innovative outcomes. Despite consisting of discrete units of delivery, both projects were nominally part of a broader plan, referred to by local policymakers as the Coventry Future Transport Strategy. This was a relatively ‘loose’ strategy, through which CCC aimed to prepare for (and, where possible, promote) innovative transport solutions in the city. The ‘loose’ aspect of the strategy represents the fact that the implementation of the various strands was dependent on securing funding. In practice, the strategy is dependent on a number of discrete projects for which funding has been made available and hence makes these two projects suitable for investigation.

The Electric Taxis project involved the installation of a number of Electric Vehicle (EV) charging points in Coventry city centre, initially to be used by taxis only. It was financed by the Office for Low Emission Vehicles (OLEV), an executive office of the UK Central Government. OLEV set up a competition, dubbed Taxi Infrastructure, through which Coventry’s bidding consortium received a total of £1.2 million to instal electric changing points in the city (OLEV 2015). The delivery of the Electric Taxis project was managed by CCC, who contracted installers. The key council department involved was Innovative Coventry, which led the application for funding, and managed the delivery once funding was secured. The most important stakeholders of note in the project were internal to CCC: the Department of Transport, Planning and Highways, and the Air Quality Team. In addition to these, Innovative Coventry also liaised with a local taxi manufacturer who, despite not being involved in the project, took an interest in its outcome, as far as they might promote the adoption of their product by local taxi companies.

The second case was the UK Autodrive project, which trialled Autonomous Vehicle (AV) technology. It aimed to increase public awareness of AVs, help cities understand how to benefit from this technology, and to ‘help to establish the UK as a global hub for the research, development and integration of automated and connected vehicles into society’ (UK Autodrive 2016). CCC was one of the 12 members of the UK Autodrive consortium, which included another local authority, automotive OEMs, consultancies operating in the smart transportation and smart cities space, and academic partners. The project was financed by Innovate UK, a non-departmental public body reporting to the then Department of Business, Energy and Industrial Strategy (BEIS). The government competition, entitled Introducing Driverless Cars to UK Roads, attributed £10 million of public money to the project, approximately match-funded by the automotive industry. Total investment was close to £19.4 million (Innovate UK 2014; UK Autodrive 2015).

Operationalization of the research

Methodologies and data

The research was operationalized across two phases. Phase 1 consisted of background analysis of secondary data, while Phase 2 involved the collection and analysis of primary data, collected through semi-structured interviews with stakeholders (Sample and primary data collection, below).

The first Phase, document analysis, involved the review of relevant policy documents from key policymakers, national and international reports on local economic policy in the UK, and news regarding economic development projects in Coventry. This identified important trends and policies in terms of local and regional economic development in the West Midlands region of England (where Coventry is located). The document sources available were sorted hierarchically in terms of their likely relevance to the analysis. Policy documents from local and regional policymakers were prioritized, as these were more likely to reflect specific strategies approaches used in practice, as well as the rationales underpinning them. The remaining materials – national and international reports on local economic policy in the UK and news articles – were used to contextualize local and regional policy documents.

In the second Phase, we undertook a series of semi-structured interviews with stakeholders across the two cases. Given the stated objective of the research – to analyse how local authorities are attempting to promote local economic development in the context of prolonged austerity, by making use of collaborative projects financed through competitive funding bids – we decided that semi-structured interviews with local authority managers and partners would be an appropriate method of data collection. Specifically, semi-structured interviews allowed us to obtain an understanding of the interviewees’ perceptions and experiences, how they define situations, how they construct reality, and which meanings they attribute to events (Punch 1998). An interview guide was used to reduce the impact of any bias from the interviewers, but the nature of semi-structured interviews meant that emphasis on different aspects of the interview did vary depending on participant experience (Grafton, Abernethy, and Lillis 2011).

The interview guide was built based on the literatures on collaborative innovation and how innovation is instituted in public services. This interview guide was divided into four sections. The first, introductory, section covered the development of the projects and the organizations involved, as well as the funding source funding. This provided an in-depth view of the history of each of the cases, and how the participants viewed the cases and their own position within the cases.

The second section of the interview focused on the networks involved in the projects (e.g. Bommert 2010; Osborne 2010; Hartley 2005). This section explored in detail what stakeholders were involved, how they became involved in the project, and their roles. Besides mapping out the networks involved, this section also was especially focused on understanding communication within the networks, negotiation, conflict resolution processes. Both formal and informal communication was explored.

Following on from the previous section, the third part of the interview guide looked at the governance mechanisms in the projects (e.g. Crosby, Hart, and Torfing 2017; Torfing 2019). This explored how delivery was managed and leadership within the networks, and how the funding requirements of these projects affected and structured collaboration within the networks.

Finally, the interview guide explored the legacy of projects. The objective of this final section was to assess if and how innovation emerging from the projects – and collaborative forms of operation and organization – became instituted in the local authority (e.g. Fuglsang 2010), as well as the roles of local authority managers in this process of instituting innovation (e.g. Catney and Henneberry 2016; Ramsdal and Bjørkquist 2019). To focus on this, the interview guide contained questions about observed long-term impact of the projects, if and how the networks developed are involved in repeat projects, and if project outcomes are ever used to attract new stakeholders to the networks of the local authority.

Sample and primary data collection

The interviewees worked for all of the major organizations involved in the projects across the public and private sector, and held senior positions within those organizations. The interviews focused on the participants’ experiences in collaboratively developing and delivering the Electric Taxis and the UK Autodrive projects, with a focus on the role of the local authority and the underlying drivers for its involvement. It should be noted that the groups of individuals involved in each of these projects is small. A total of 24 informants were interviewed, broadly in three categories: a) individuals working on the Electric Taxis project in CCC (multiple departments involved in the delivery) and partner local authorities (a total of eight interviews); b) individuals working in the UK Autodrive project, including from CCC (multiple departments), a consultancy, partner local authorities, OEMs and the funder (seven interviews); and c) individuals interviewed about the wider strategy for economic development in Coventry and the West Midlands region (12 interviews). It should be noted that some participants were interviewed about more than one topic, as their work crosses more than one theme explored in the research.

Given the nested case study design of the research, and in order to provide background beyond what could be imparted by the small number of project officers and project stakeholders, a portion of the participants were not interviewed about a specific project, but about CCC’s economic development strategy in general, and how collaborative innovation is understood in CCC. This is because the interviews were designed to examine local economic development more broadly in the context of this case. All interviews took place in 2017, while the two projects were in the delivery phase.

Data analysis

Interviews were recorded and transcribed verbatim, and then a qualitative content analysis was conducted using NVivo. The analysis used a grounded theory-inspired method, allowing key themes to emerge from the data, but guided by the conceptual ideas of collaborative innovation. Key themes identified related to collaborative innovation in the public sector, as well as how those innovations can become instituted. Specifically, we divided our analysis in three phases of the bidding process (before and during bidding; once funding is secured; and beyond the scope and timescale of the project), and for each of these phases we identified the role(s) played by local authority managers involved in bidding, as well as how these roles were guided by the requirement of the bidding process.

Data was triangulated from the document sources and semi-structured interviews with stakeholders (Fusch, Fusch, and Ness 2018), in particular noting how the projects aligned with policy objectives and to verify claims made by participants, as an important stage in the case study analysis (Creswell 2007). This allowed us to converge the disparate evidence in order to increase the validity of the findings. The following section presents those findings.

Findings

Promoting collaborative innovation: the local economic development-by-project approach

The financial constraints on local authorities resulting from prolonged austerity mean that innovative forms of promoting local economic development through collaboration are required. As noted in the Introduction, these include competitive bidding for innovation projects funded by central government (and, before the UK’s exit from the European Union, EU funds). This section analyses how the processes required for collaborative innovation manifest in the case studies, focusing on three key phases: before and during the bidding process; implementation of the project once funding is secured; and beyond the funding scope and timescale.

The results suggest that the local authority serves as a broker before and during the bidding process. In its role as initiator of the funding bids, the local authority managers serve as brokers by aligning government policy and priorities with locally embedded capacity and resources. This often means ‘following the money’, focusing on specific technologies or outcomes which are being promoted by government and policymakers, and fitting the funding bids around those.

Once funding is secured, during project implementation, the project managers become institution-builders. Operating at street-level, the project managers experiment with possible structures and meeting schedules, involve appropriate stakeholders in different working groups, and institute processes to assure successful project delivery. The structures put in place are strongly formalized in order to address the strict requirements put forward by funders, whilst also accounting for the needs of the consortium involved in delivering the project. Local authorities also communicate with other grant recipients, to understand possible best practice in project management and delivery.

The strictly limited nature of the projects, both in terms of scope and timescale, meant it was difficult for CCC to capture longer-term value for its local area. Local authority managers try to make use of the projects to generate interest among other stakeholders, sharing some of the findings and building networks with other parties. The construction of these networks has a component of bricolage, with managers making use of different project aspects to build and solidify networks of interest for future possible projects. However, these networks are often dependent on individuals, and can disassemble without funding for follow-up projects.

These three phases are discussed in the next sections.

Before and during bidding: aligning the interests of stakeholders for collaborative innovation

The process of preparing for and writing a funding bid involves the local authority working as a broker, aligning interests and values, funding bodies’ policy objectives and the priorities of delivery partners. This process is often quite top-down, with local authority managers establishing the necessary connections and guiding the bidding process.

In both project cases analysed the initial involvement of the local authority was driven by funders’ wider societal interest. The first driver to which the local authority responded revolves around environmental protection, health, and quality of life in cities, focusing on aspects such as reducing CO₂ emissions, improving urban air quality (Electric Taxis) and reducing traffic congestion in the city centre (Autonomous Vehicles). This agenda is driven by societal concerns expressed by stakeholders such as the public, businesses, and central government. Running in parallel to health and environmental well-being, a second driver involves priorities around economic growth and employment in the local area, through supporting local businesses which develop and manufacture new technologies. Part of this agenda is specifically driven by a desire to see a significant growth of well-paid jobs in the area:

[…] the case in particular is a means of helping to pursue sustainable development through reducing vehicle emissions. There’s also a key economic development angle to this though, in essence because Coventry has [an OEM] and a lot of its supply chain. […] So, alongside the need to reduce vehicle emissions, there’s also a significant economic growth impact to come out of it. If there’s greater take up and production of electric taxis, it creates a lot of high value jobs, which is clearly good for our local economy.

(Interviewee 1)

A third driver, related to the previous two, is central government’s stated desire to promote Britain’s competitiveness in world markets. The UK Government is specifically interested in promoting British-developed and British-made products in advanced technology sectors, and Britain as an attractive country for investment in these areas (UKTI 2011, 2014). This dovetails with a concern that other nations may be forging ahead and leaving British innovation and manufacturing behind (Chapman 2019; Barnett et al. 2014). Ministers have repeatedly mentioned this fact, a point made by interviewees. According to a manager for the (then) Office for Low Emissions Vehicles (OLEV)⁴, the founder of the Electric Taxis project:

Our role is to support the kind of emerging market in ultra-low emission vehicles and really trying to position the UK as a […] leading country for investment in that and to drive that transition for economic purposes, for air quality purposes, [and] for carbon reduction purposes.

(Interviewee 10)

Managers at the local authority responded to these three broad drivers – social, environmental and health outcomes; promotion of advanced manufacturing; and promotion of Britain as a competitive nation in world markets – and made a strategic decision to promote the area along those lines. This was achieved by drawing on Coventry’s long history as a manufacturing hub, and as the headquarters of many companies in the automotive industry. Consequently, advanced manufacturing in the automotive sector was identified as one of the main pillars of Coventry City Council’s Strategic Economic Plan (CCC 2014). The plan does not call for investment in zero-emissions or autonomous vehicles specifically; rather, it focuses on the potential of existing firms in the area. The support for technologies which help steer the automotive industry towards more environmental, health and socially conscious trajectories is a response to the specific technical, instrumental and competitive funding mechanisms that are available. In the words of the former programme manager for the Electric Taxis project:

Because the funding was there, that’s why you go for it (…) The only way we could do some research developments and probably improve our infrastructure was to bid for this funding.

(Interviewee 2)

The Electric Taxis project is a clear example of the decision to align local priorities and industry with government strategies and funding streams. Management at the local authority designed a strategy to pursue the funding, establishing a group to examine the viability of bidding for the call, initiate contacts with the funder, and be involved in the feasibility studies which took place before the funding round opened. That same team went on to establish working partnerships with external stakeholders of interest – such as other local authorities involved in bidding, electricity providers, and a local manufacturer of plug-in hybrid taxis, which would be prepared to make use of the charging points to be installed.

In the cases under study, the process of engaging in collaborative innovation is the result of a strategic decision made by managers at the local authority, in the context of the funding mechanisms on offer. The local authority managers make use of the local authority’s position and track record to promote their legitimacy as project initiators with local stakeholders and with funders, aligning interests and brokering the relationship amongst other members of project consortia. It is a top-down process, the objective of which is to establish stable networks which can credibly apply for, and deliver, innovation projects.

Once funding is secured: implementation-focused process of institution building for collaborative innovation

Once funding is secured, local authority managers need to institute processes to deliver the projects on time and on budget. Time constraints and budgetary controls become the most important aspects of project management; not only are there tight deadlines to observe, but any over-spend or under-spend of agreed funds causes problems and friction with the funder. However, the local authority’s project managers – operating at street-level – do not have the technical knowledge to deliver the project themselves; their role is to develop institutional mechanisms for collaborative innovation in order to manage successful project delivery.

A series of recurring and overlapping committee meetings between the local authority’s project managers and the private partners form a control mechanism for any funded project. This mechanism is not set at the beginning of the project: while the proposal indicates budgetary and timeline requirements to be achieved, project managers need to experiment with the best ways to achieve what is required in practice, and institute that mechanism for project control. This often involves a set of cascading committee meetings, as noted by one interviewee, a local authority manager involved in the UK Autodrive project

At the higher level we have a consortium meeting. The consortium meeting is really a meeting to demonstrate to our funding body that we’re making progress. (…) we paint the picture of what’s been happening by all the things you’d expect to see in a project – project plan, project report, risk registers, issues, loss, all those are produced for the monitoring officer that are thence.

The nitty gritty and directing of the project goes on at the steering committee level. Each member of the consortium [is represented], but [at] a more technical level, where issues are discussed and where we might need to make changes to the project because of what happens, discuss those and decide the best way to take them forward through the processes if we need to shift resources around.

(Interviewee 7)

All these meetings – consortium meeting, steering committee meeting, working project group meetings – respond to the need to control progress and periodically report on the delivery of the project objectives and budget. It is possible for teams to have parallel informal meetings – but the leeway is small:

You have your side meetings, you discuss things, you see what’s happening, how do we address this, but then you need then to take them through the formal channels. It’s very difficult to manage because you don’t want those to be happening without full visibility. The consortium includes a consultancy who provide that overall project management function, so there’s a dedicated project director who attends all the meetings. And a project manager, again who attends, supports and helps the coordination so you’re not going off in tangents.

(Interviewee 7)

The need to formalize all communication is the result of the strict conditions within the funding mechanisms imposed by the funder. Decisions need to be formalized and justified, then acted upon, so the dedicated project director and manager take steps to formalize what would otherwise be informal meetings.

Another aspect is collaboration with other local authorities. The nature of local-economic-development-by-project means there is a clear distinction between funding bid preparation, where competitive dynamics are at play, and project delivery, where collaborative action is more likely as the competitive element may no longer be relevant since the funding has been awarded. This was noted by the manager leading the funding bid for the Electric Taxis project:

It’s actually really difficult to know what’s the best solution and process to go through. We are working with [two other local authorities in the West Midlands] because they’ve got the funding as well, and [we are] trying to make sure that [delivery is] a bit more joined up, and informing each other about what we’re doing with the procurement and any ideas we can share because we’re not in competition anymore. We’ve got the funding, so we might as well work together!

(Interviewee 2)

This exchange of practices between managers in local authorities goes on to influence how each local authority organizes to deliver the project in its area.

Once funding is secured, the local authority’s project managers need to balance the requirements of project delivery, imposed by the funder, with the emerging needs of the partners involved in the project. Managers balance out the top-down requirements and bottom-up local tinkering of the details. The various committee meetings serve as clearing houses to balance these two demands – top-down and bottom-up – in order to make sure that all stakeholders understand the process. The objective is to create a predictable and transparent environment for all, even if this results in the curtailing of spontaneous interactions.

Beyond the scope and timescale of the funding: network building and long-term value capture from collaborative innovation

Funded projects are limited in terms of scope and in terms of the timelines of value delivery. The formed networks have to deliver well-defined objectives to budget and strict timelines. However, local authorities are interested in promoting broader economic development in their area beyond that time period and scope. Managers in the local authorities can make use of the projects to achieve this.

In one example, CCC engaged with a local automotive OEM which was in the process of developing a plug-in hybrid electric taxi. The company was not a partner in the Electric Taxis project, but still the project manager decided to discuss it with the company. What emerged at the time was that the OEM did not have an extensive knowledge of the taxi trade in Coventry, or of the preferences of the taxi drivers, because the company was focused on the taxi trade in London and overseas. The local authority manager involved in the Electric Taxis project took this opportunity to engage the company:

[…] we’ve done a lot of supporting [the OEM] because they are not aware of what our taxi trade is like. We’ve had meetings where we’ve taken our [trade union] rep and some of the taxi drivers up to see [the OEM] for a presentation […] I was surprised when they were asking us to set up a meeting with some of the taxi trade. They did end up doing a survey, towards the end, but we’ve also done surveys as well, so we were sharing the information.

(Interviewee 2)

In this case, the local authority manager used the project to find common ground and to establish relationships with the company. This was confirmed by a manager at the OEM, who noted they ‘have lots of time for [the local authority manager]’. The objective goes beyond the strict scope of the Electric Taxis project, leveraging it in order to develop networks. The local authority hopes to make use of these relationships for future projects, and to help capture more of the broader value of the project locally.

However, it should be noted that these relationships are often embedded within the individuals involved. In the same conversation, the manager for the OEM also referred to the fact that, since that particular manager had now left the local authority for a position elsewhere, they would not know who to contact for further discussions. The tacit knowledge and social capital which underpin these relationships is easy to lose, as the collaboration between the organizations themselves (local authority and OEM) was not official. Thus, the ability to capture the value of the collaborative innovation project beyond its strict scope and timescale can be limited. This type of tinkering by local authority managers at street level can be useful, but only a subsequent funded project can institutionalize the relationships and networks for collaborative innovation.

Discussion and conclusion

At the time of writing this paper, the 2022 cost of living and energy crises along with more government-imposed austerity looks set to have a strong impact on local authorities. This is on top of several rounds of cuts to local authorities’ funding since 2010. This paper has analysed collaborative innovation institutional and management processes that a local authority in England has developed to address the challenges posed by prolonged austerity – competitive funded innovation projects, what we term ‘local-economic-development-by-project’. To make these projects work, local authorities – and their managers – have to display considerable agility in collaborative innovation. The work involves consideration of how disparate priorities can be addressed in the context of a project, to be delivered in their local area. This is creative work, with a focus on ideas and the ‘big picture’; these ideas shape how the projects will be designed and justified to funders (Ferreira and Ferreira 2018). But once funding is secured, the local authority’s work changes to control procedures. This is the phase when relationships between stakeholders become instituted, through the control mechanisms of the projects. As for what happens outside the scope and timeline of the project, the local authority managers are once again asked to be creative in who and how they approach. This flexibility suggests that local authority managers are working as street-level entrepreneurs (Arnold 2015; Petchey, Williams, and Carter 2007), attempting to maintain aligned policy windows even as there is policy churn at central government level.

The findings demonstrate that collaborative innovation is instituted and managed by the local authority via a complex process involving its managers changing their role according to the phase of the project; from brokers to institution-builders and to networkers, depending on the phase of the process they are working in (respectively, before the bid, implementation after funding is secured, and beyond the scope and timeline of the project). These different activities are often in tension with each other: the brokerage activities are curtailed by the strict limits and regulations required by funders of the projects, while the networking activities can be undermined by the fragility of the networks involved in the projects. Furthermore, these networks are strongly dependent on specific individuals occupying certain positions in their organization. As these individuals change jobs within or outside their organization, some of the ability to capture value in the long run is eroded.

Local economic development priorities are often long-term: local authorities often want to address structural issues (investment, infrastructure, training and human capital, to name a few) which will make the local area more competitive and improve the standard of living. Local-economic-development-by-project through collaborative innovation does not necessarily enable this; instead, it can be characterized as a small-wins approach (Termeer and Dewulf 2019); identifying small wins, trying to accumulate these into transformative change, and feeding the results back to the development process to activate these small wins. However, the nature of the collaborative innovation projects funded in the presented case makes this difficult, as the small wins are difficult to accumulate due to their dependence on the (changing) priorities of funders. Local authorities may find it difficult to consolidate the small wins into instituted change. Apart from the period in which there is a funded project, there is little opportunity for relationships with partners to become instituted and the collaboration embedded. Local authorities have to continuously search for funded projects, and continuously adapt their pitch to changing policy priorities as enacted by funders.

Management implications

The findings demonstrate the important role played by local authority project managers in instituting and managing collaborative innovation projects. They need to be able to make decisions regarding how and what projects to pursue and how to engage potential partners, while at the same time having the ability to work with internal stakeholders to ensure that the projects are implemented. Local authority management needs, therefore, to allow these individuals both the autonomy and the legitimacy they need to make these decisions.

The findings also demonstrated that the loss of human capital that occurs when some of these individuals move to a different position or another job can deteriorate the networks built over time. While some of the knowledge lost is embedded in the individuals and cannot easily be codified and transferred, it is important that individuals work in broader project teams in collaborative innovation projects, so that colleagues can take over whenever a project manager is no longer available. Any actions that can be put in place to retain these individuals can help ameliorate this challenge.

Limitations and future research

This paper is based on a limited set of nested case studies, with a relatively small number of individuals (some of whom worked across both cases under study) and as such is limited in terms of wider generalizability. However, the paper does provide novel insights into the challenges and opportunities that local authority managers deal with when attempting to institute and manage collaborative innovation projects for local economic development. Future research could take a comparative case study approach, in order to analyse other possible management approaches to collaborative innovation in other local authorities. These studies could examine, in particular, the problem of long-term value capture, and how the small wins of the projects can be built into long-term systemic change. A longer-term analysis than that completed in this project could help understand how local-development-by-project can help build better local economic development outcomes in the long-run.

Disclosure statement

No potential conflict of interest was reported by the author(s).

Additional information

Funding

The work was supported by the European Spatial Planning Observation Network (ESPON) .

Notes

1. Typically, by InnovateUK (business innovation competitions), but also by agencies such the Office for Low Emissions Vehicles or NHS Digital, amongst others (grants).

2. Mainly Horizon Europe. Until the end of 2019, English regional authorities were also eligible for funding under the European Regional Development Fund (ERDF) and European Social Fund (ESF). Since the UK left the European Union, this is no longer the case.

3. An analysis of the criteria for assessment of the funds is beyond the scope of this paper, but can be found on the UKRI website: https://www.ukri.org/our-work/collaborating-internationally/working-on-eu-funded-projects/ (UKRI 2021).

4. OLEV is now OZEV – Office for Zero Emission Vehicles: https://www.gov.uk/government/organisations/office-for-zero-emission-vehicles.