Category Archives: systems thinking

290 – The Capability Trap: How Budget Cuts Damage Councils Long Before Anyone Notices.

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3100 words (15 minutes reading time) by Colin Weatherby

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Credit: ChatGPT

Summary

  • Councils under rate caps are being pushed into a capability trap: cutting investment in how work is done, while demanding the same (or more) output.
  • Doing more with less works for a while, then it quietly destroys the ability to deliver safe, reliable services.
  • Escaping the trap means shifting from “work harder” to “work smarter” – investing in process capability, not just pushing people to do more.
  • This piece explains the trap in plain language and offers advice to avoid it.

Introduction

After ten years of “doing more with less”, many council roads managers describe their world like this:

“Today, I barely recognise our roads program. Every budget cycle we cop another efficiency dividend, another round of ‘temporary’ cuts to inspections, reseals, heavy patches and drainage repairs. On paper the program still looks coherent thanks to some clever rephasing and optimistic assumptions, but out on the network the cracks are literal.

We’ve gone from renewing assets at the right time to stretching them well past their use-by date. Crews that used to do planned maintenance now spend most of their time chasing potholes and complaints. We’ve sweated the plant so hard that breakdowns are normal, and cut training and supervision to the point where we’re relying on a few old hands to hold everything together.

What hurts most is knowing this was avoidable. Every ‘saving’ we booked was borrowed against the future condition of the network. We’ve lost capability in quiet ways – trainees we didn’t take on, engineers who left and weren’t replaced, inspectors who no longer have time to inspect, relationships with contractors hollowed out by always taking the lowest price.

The community still expects the same level of service, but we’re no longer set up to deliver it. We’ve traded investment in capability for short-term budget wins, and now the bill is arriving as risk, backlog and a network that’s deteriorating faster than we can look after it.”

This isn’t a story about lazy workers or bad managers. It’s what it looks like when a council slides into what Repenning and Sterman call the capability trap – without realising it.

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284 – The Public Service Chain Reaction.

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1700 words (18 minutes reading time) by Carole Parkinson

The Deming chain reaction

Tim Whistler cuts straight to the chase. In the case of his latest piece, I think he could do with a little nuancing of what he is proposing. His description of the disruption to ensue if councils can’t manage their finances with a rate cap is probably accurate, but also, avoidable.

I have been talking to executives at councils and it is true that they are grappling with defining and agreeing on what they need to do. Everyone involved in leadership seems to be pulling in a different direction – Finance wants direct funding cuts to balance budgets now; Directors want efficiency drives to fit services into budgets as soon as possible; Councillors want to cut services they think the State should provide and avoid electoral backlash when they stand for re-election in 2028. It is a vicious cycle.

I have a more immediate approach, which neatly fits with Whistler’s focus on infrastructure as the big service, allocating capital first, and, most importantly, reducing expenditure where you should, not just where you think you can.

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276 – Synchronicity, systems, facts and accidents…

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1300 words (14 minutes reading time) by Lancing Farrell

I have been doing some diverse reading recently, some of it inspired by world events. Serendipitously, it has led me to an insight that I thought I would share.

Why we’re Polarized

The first book is Ezra Klein’s international bestseller ‘Why we’re Polarized’. He says the book is an examination of the American political system and that it is unlike most books on American politics, which he says tend to focus on the individuals.

“Let me be clear from the beginning: This is not a book about people. This is a book about systems.”

Ezra Klein, ‘Why we’re Polarized’

Klein is an American and says two decades of reporting on American politics has shown that it has predictable cycles and patterns that repeat. He sets out to explain the failure of the political system, which he says occurs despite it being ‘full of rational actors making rational decisions given the incentives they face’. He describes it as a collection of functional parts that combine into a dysfunctional whole.

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274 – The Wigan Deal and Value for Money

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1500 words (17 minutes reading time) by Carole Parkinson

The Wigan Value for Money Statement

Lancing Farrell’s post on Wigan and the Deal 2030 explains how a council has successfully decided to make a radical change in the relationship with its community in response to austerity measures imposed by central government. By all accounts the Deal 2030 has been successful in reducing the resources needed for the council to deliver its services, in large part by reducing demand for those services by helping people to do things for themselves or to access services provided by the VCFSE (voluntary, community, faith and social enterprise) and private sectors.

It is 10 years since the Deal 2030 was launched. As with any big organisational change, it is hard to evaluate its success from the outside. To help us, there have been several reviews of the Deal 2030 since it was implemented, including the King’s Fund (2019), the Centre for Policy Impact (2019), and a Corporate Peer Challenge (2017). All have reported favourably on both the success in implementing actions in the Deal, and the impact of those actions on the Wigan community. Therefore, it was with some interest that I saw Wigan Council has recently released a Value for Money Statement.

Perhaps everything is not what it appears?

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271 – Victorian government enquiry into local government

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1000 words (11 minutes reading time) by Colin Weatherby

The Victorian state government’s Legislative Council Economy and Infrastructure Committee has started an enquiry in to the funding and service delivery of local government in the state, which will look at:

  • The effects of cost shifting from the state and federal governments to local councils in an examination of vertical and horizontal fiscal imbalances.
  • Whether local councils are adequately delivering on their core service delivery objectives.
  • The overall revenue structure of local government.
  • Whether the existing revenue structure is sustainable and appropriate or if alternative models of funding would be more sustainable and appropriate.
  • Any other related matters.

This is a timely review and comes at the same time that the national government is also holding an enquiry into the financial sustainability of local government. It seems that the other levels of government have become concerned about whether councils are able to meet community needs and expectations now and in the future.

Unsurprisingly, the Local Government Finance Professionals (FinPro) have made a submission to the Victorian enquiry . They make a number of interesting points in their submission.

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264 – ‘What on earth is a paradigm shift?’ – Centre for Public Impact

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400 words (5 minutes reading time) by Colin Weatherby

I have been experimenting with Microsoft’s ‘everyday AI companion’, called Copilot. I asked it to analyse the podcast ‘What on earth is a paradigm shift?’ by the Centre for Public Impact.  I am not trying to second guess the great work by Lancing Farrell, simply to show how some new technology works!

This is what it came back with:

The podcast ‘What on earth is a paradigm shift?’ by the Centre for Public Impact (CPI), is a  conversation between Adrian Brown and Professor Toby Lowe, who are both part of the CPI team. They discuss the concept of paradigms and how they apply to public service and systems change.

Here is a brief summary of the podcast:

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263 – System governance is the key to shifting the local government paradigm

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850 words (9 minutes reading time) by Lancing Farrell

The need for a new paradigm in local government in Victoria has been mentioned in a few posts recently (see 241 – Rate capping – the final words (from our future), 253 – Minds Change: My Journey to Transform Local Government Performance, and 261 – Reinventing Local Government). Model collapse, as described by Carole Parkinson and Tim Whistler, signals the end of an existing paradigm. This raises critical questions about the current paradigm in local government and the need for change. A recent podcast in the Reimagining Government series by the Centre for Public Impact, ‘What on earth is a paradigm shift?’, discusses paradigms and provides insights and practical tips for those wanting to bring about transformative change.

Defining Paradigms

The podcast features host Adrian Brown and Professor Toby Lowe from the Centre for Public Impact, Henk-Jan Dekker from the International Centre for Environmental Research and Development, and Jessica Studdert from think tank ‘New Local’. Drawing on the work of Thomas Kuhn and Margaret Masterman, a paradigm was defined as a ‘grand explanatory narrative for how a part of the world works’.  It operates on metaphysical, sociological, and exemplar levels, shaping perceptions of what exists and what should be valued. Understanding how paradigms work is crucial for those seeking systemic change in local government.

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257 – Austerity and Victorian local government

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800 Words (9 minutes reading time) by Colin Weatherby

I was reading the latest Local Government Information Unit (LGIU) newsletter from the UK and the news item in the image above caught my attention. Although the cause of the problem is central government cutting funding to councils, not imposition of a rate cap, it has the same effect on council finances and reinforces the view I expressed in my posts about the effects of the rate cap (‘Il comune povero- ‘The poor municipality’ and ‘Rate Capping – the final words (from our future))’. Councils in Victorian can respond by trying to improve current services and increase revenue, find efficiencies and reduce waste in operations, and they will still be unable to meet community needs and expectations within their available resources.

In Victoria, councils cannot issue a section 114, which in the UK means that all spending, apart from on protecting vulnerable people and providing statutory services, will be suspended. Instead, the Victorian government sends in Monitors to oversee council decisions, and then, if the council doesn’t respond as the State requires, they can dismiss the council and appoint Administrators to run the council. In the past, this has resulted in decisions being made by the unelected Administrators to sell community assets, cut services and make whatever changes they think are necessary to get the council back in the black. This tends not to meet community needs and expectations either.

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253 – Minds Change: My Journey to Transform Local Government Performance

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600 words (7 minutes reading time) by Lancing Farrell

Have you ever had that eureka moment where something you were trying to understand is suddenly made crystal clear to you? That’s exactly what happened to me after reading David McRaney’s thought-provoking book, ‘How Minds Change – The New Science of Belief, Opinion, and Persuasion.’ This enlightening read gave me reason to revisit some past posts on improving local government performance. In reading the book (and this is deliberate by the author) I was led through Piaget’s stages of assimilation and accommodation, before eventually reaching a Kuhnian paradigm shift. My epiphany was realising why organisational change is so hard.

When I looked back at my earlier posts, I realised that my growth as a leader accelerated when I first saw work as a system. At the same time, I genuinely believed that I needed to become the architect of better approaches. I had an academic background, experience of travelling overseas to broaden my outlook, and a relentless passion for my work. I thought that if anyone could revolutionise services, it would be me.

However, this view eventually transformed into a more holistic and community-oriented perspective as I started to see the work as a ‘frog’ system, not a ‘bike’ system. You’ll need to read my previous posts to grasp the analogy, but in essence, I transitioned from a thinking I needed to be a one-man show and lead others by giving them better ways, to a more participatory approach where everyone is engaged in finding improvements.

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