Better strategies in government

Plus - why we should be golfing with Donald Trump

Welcome, new subscribers (and thanks for signing up). In this edition I’ll be writing a bit about strategy, why the government seems to be struggling to do it well - and a few lessons I learned from my own time as an insider.

Labour and the coherence problem

When critics of the government complain about the lack of a clear strategy, it usually means one of three things.

The first critique is that with limited (and diminishing) financial and political capital, Labour can only afford to make a very small number of big, bold changes, so they need even fewer priorities. Without this, what is likely to follow is policy ‘micro-dosing’, where resources are spread thin and the policy heft is not in proportion to the severity of the disease.

The second critique is that the government lacks a clear game plan for their missions. You may be able to list some initiatives and policies, but what is their theory of how to transform the NHS, or drive school improvement? What is their account of past success and failures? On the economy, Ben Ansell has argued that their theory of change does not cohere because it is a pick and mix of mutually incompatible approaches.

The final concern is that the government is insufficiently political. There is not a clear enough link between political strategy – how Labour intends to build a winning coalition – and governing strategy for how they will improve the country. The last Labour administration had advisors and civil servants that were adept at spanning policy and politics, whereas today, there seems to be a more rigid division of labour.

I’m less persuaded by the first critique. Despite the missions, milestones, first steps and foundations, I suspect the government places three priorities above all others: economic growth, the NHS, and migration. The missions on net zero, opportunity and crime are important, but second order.

The other criticisms are more valid. What is missing so far is a theory of change for each mission, or any attempt to quantify how much change can be made within 5 to 10 years, given the financial and political constraints. Missions cannot just be an exercise in wishful thinking.

Even this concern must be tempered with acknowledging that the government is just 6 months old. Those reminiscing about how well prepared Labour was in 1997 ought to be reminded that Labour spent some of its first term abolishing the internal market in health care and grant-maintained schools, before largely recreating them during their second term.

Nevertheless, Labour has a strategy problem that needs fixing. Much of that will happen over the next year alongside the Spending Review. While ministers will want to portray 2025 as the year of delivery, it might better be characterised as the year of strategy.

Labour should start by getting the capacity and capability in place. I spent many years working on government strategies and creating strategy units, in both economic and social policy, domestic and foreign affairs. Compared with 15 years ago, the capacity available to this government is weak and underpowered. There is no equivalent to the Prime Minister’s Strategy Unit, the Social Exclusion Unit that I was part of, or the Office of Climate Change that I set up – a shared resource across departments that drew up the Climate Change Act.

Those units had precious ingredients for making good strategy. They were not involved in day-to-day policy delivery so had the headspace and independence to think critically. Projects lasted for 6-9 months so teams had the time to do proper analysis. The units had a large number of outsiders – practitioners, researchers, and strategy consultants who brought skills and expertise. Because of where they were located and who was in them, their ethos was different. Instead of being focused on how to satisfy key stakeholders, the approach was to look at issues from first principles.

The next 6 months will be crucial. Strategies are often forged, implicitly or explicitly, through spending reviews. The financial constraints make them real.

Having obsessed about these things for a while (and got it wrong lots of times), I thought I’d share some reflections on how to do strategy in government well. As Geoff Mulgan pointed out in his book, The Art of Public Strategy, while there is a huge industry producing business books on private sector strategy, the field of government and public sector strategy is much less well developed.

7 ways to improve strategy in government

Choose the scope carefully. Government departments, including the Treasury, are organised sectorally. We therefore usually create strategies that relate to organisations and sectors (NHS 10-year plan), or single outcomes (Health Mission). A single outcome focus often makes sense as a starting point. For example, we should be asking how we allocate resources to maximise healthy life expectancy.

But some of the best strategies are organised around categories that do not mirror the bureaucratic architecture. They are based on people – particular client groups or age cohorts – or places, such as neighbourhoods or cities.

Sure Start emerged not out of the usual spending review process but from a cross-cutting Review on under 5s. It was from projects by the Social Exclusion Unit that rough sleeping was reduced by two-thirds, exclusions by a third, and teenage pregnancy halved. In foreign policy, scope matters even more. For example, when I worked on Afghanistan strategy in the late 2000s, even when the conflict became hyphenated to ‘Af-Pak’ it was not viewed as a regional conflict that needed a regional settlement.

Do a proper diagnostic to get under the skin of an issue. Whitehall strategies sometimes skip over analysing the problem in enough depth. Without this crucial step, strategies set off in the wrong direction.

Start by looking at the trends, future scenarios and international comparisons. Assess why the system might be failing. Immerse yourself in the context. Try to form hypotheses about what might be driving variations across similar places and time. We generally learn far too little from the ‘positive deviants’ or what other countries do.

When setting goals or targets, think about Google’s distinction between aspirational goals versus committed targets. The former are ultra-ambitions, possibly moonshot goals. They stretch ambition and jolt the system into thinking more radically. Decarbonising power and building 1.5m homes by 2030 are examples, so too eliminating child poverty and the Sustainable Development goals. Failure is tolerated, as long as the target drives more radical action and improvement than if a more modest goal had been set.

Committed targets are calibrated to be achievable. These are often set not at the beginning of a process, unlike moonshots. They should be developed alongside work on a theory of change, with goals only agreed alongside an understanding of how much money and political capital will be put behind a strategy.

Labour’s first steps, milestones and missions are an attempt to combine both committed and aspirational targets. However, in many cases, there is a lack of coherence, illustrated by the weak connection and alignment between the first steps and milestones and the ultimate mission outcome.

Construct a theory of change – the essence of a strategy – and an evidence review. Lay out the causal chain that ladders up to the desired outcomes. Then review the evidence to assess the quality of the evaluations and the effect size and cost-effectiveness.

There are many failure modes at this stage in the process. Theories can be too narrow – biased towards issues or levers within a departmental remit – or too broad, reflecting every stakeholder’s wishlist. They can therefore lack coherence, or any sense of which pathway matters more. They can also lack the detail required to be actionable. Creating a ‘behavioural systems map’ – where you chart whose behaviour needs to change, in what way, and what might influence them – is a good next step.

Numbers, not adjectives. This was the motto of my brilliant former colleague, David Mackay. What he meant by this, as he articulates in his book Sustainable Energy without the hot air is that we often use words like ‘large-scale’ or ‘major’, when it is totally unclear whether we are talking about a big fish or a minnow. To prioritise and make decisions, we should force ourselves to roughly quantify the ‘dose-response’ relationship – the plausible effect of a change.

The civil service does not struggle with this when there is solid evidence or at the end of the process, when it does an impact assessment. But when forced to do rough approximations, early on in a policy process (when decisions are actually being made), it usually struggles. The Mackay 2050 net zero calculator is an excellent example of how to bring numbers into the conversation early, as is our Blueprint to halve obesity, where we reviewed thousands of academic studies to generate estimated effect sizes for 30 interventions.

Define what you are uncertain about. As part of the theory of change, there is a tendency to sound more certain about results than is warranted by the evidence. When the Prime Minister’s Delivery Unit asks you about how you will get back to the required trajectory for improvement, or your minister is interviewed, all of the incentives are to sound excessively certain. (The Treasury has the opposite incentive, and tends to use the uncertainty or absence of evidence to justify inaction and conservatism, rather than a reason to rapidly generate solutions and evidence)

The types of uncertainty vary. Some relate to well-proven solutions. You may have an intervention that improves reading levels that is now in 200 primary schools, but you are not sure how to drive adoption, cheaply and quickly, across 20,000 schools. You may have a smoking cessation program that is well evaluated, but you are not sure whether it could operate at a lower dosage, or with more digital support, so that it could be scaled more cost-effectively.

Or the uncertainties could be more fundamental. You may have been asked to reduce violence against women and girls, and you don’t have proven, well-evaluated interventions to point to. You need long duration storage to deal with an electrified economy powered by renewables, but you don’t know which one will emerge and over what timescale. Even more challenging is when the aetiology of a condition (e.g. adolescent mental health) is not known.

Find the fastest and most rigorous way to resolve these uncertainties, and adapt your strategy as this data emerges. There are many ways of resolving uncertainties. Prototype solutions. Run randomized trials or quasi-experiments. Create technologies races. Hold auctions and prizes to discover better or cheaper solutions, and draw in unusual suspects into constructing a solution. Construct regulators so they have the information to intervene in real time, neither prematurely nor too late. Create state-owned companies that can reduce the information asymmetries between market participants and policymakers.

Start-ups figure out uncertainties quickly – pivoting their solutions to find product-market fit. The Government’s ‘test and learn’ programme is one attempt to mirror this approach, but it’s just a start. We need much larger ‘directed R&D funds’, channelled through a variety of organisations, with strategy and policy constantly being reverse-engineered based on this learning.

The best strategies will therefore be a combination of fixed, long-term commitments and frameworks, but with enough room for adaptation. As Lawrence Freedman wrote in Strategy: a history, it is often better to ‘be strategic’, rather than ‘have a strategy’ (let alone a strategic plan).

I hope those reflections are helpful to those writing or reading strategies. Politicians tend to obsess about delivery, but they ought to start by fixing the strategy problem.

Things I’ve been thinking about

Donald Trump is demanding that the UK and other members of NATO spend 5% of their GDP on defence. A target defined in terms of inputs is a bad way to anchor any strategy. It takes away the pressure for the MoD to find cuts and efficiencies, or to look at what capabilities are needed to keep the UK secure. It will also be extraordinarily expensive.

Excerpt from FOI detailing number and location of MoD / Armed Forces golf courses

I might have a workaround and it involves one of the President’s favourite activities. It turns out the MoD owns a remarkable 19 golf courses, including 3 in Cyprus. (Yes, this brought out my inner Taxpayers Alliance demon too). Why not negotiate planning permission on them, and get the Crown Estate to build houses, solar farms and wind farms and reinvest the proceeds in the defence budget?

Or perhaps we could just do a deal with Trump directly, and flog them at a cut price to ‘Trump Golf’ in return for less defence spending. Now that’s the kind of ‘Grand Bargain’ strategic thinking we need.

What I’m reading/listening to

A New golden age of discovery: seizing the AI for Science Opportunity. Belatedly read this excellent essay, by a number of DeepMind folk including my former Nesta colleague Juan Mateos Garcia.

Complete Unknown: I actually found the Bob Dylan film a bit empty so I can’t quite work out why I enjoyed it so much – still thinking about it.