Understanding public service innovation ecosystem : challenges, role of collaboration, and factors affecting the adoption of the public service innovation ecosystem in Finnish small cities

Abstract

Numerous studies have been done on public service innovation ecosystems focusing on large cities but small cities with limited resources have often been overlooked. The solutions designed for larger cities with sufficient resources are not always suitable and applicable to small cities. This study aims to understand how innovation ecosystems function mainly in small and medium-sized Finnish cities with a specific focus on identifying key challenges and barriers, and on the role of partnerships and collaboration. The researcher used a qualitative research method based on semi-structured interviews with city development managers, city council members, and industry representatives. In addition, many public service innovation projects were studied and analysed to understand how innovation ecosystems function in practice and how collaboration among actors create solutions. The findings show that Finnish cities have a strong innovation ecosystem and innovation depends on collaboration among government, academia, industry, and citizens. Most Finnish cities have sufficient infrastructure, like universities, research labs, and incubators, to support an innovation ecosystem where ideas can be generated, developed, and tested. Development managers and frontline staff have a clear understanding of the value of innovation ecosystems, and cities with large companies have an impressive level of collaboration, but smaller family-owned businesses lack experience in collaboration and face challenges related to trust. Long-term contracts with companies, language barriers for international companies, small businesses, citizens and environmental activists resisting change were identified as challenges and barriers to improving public services. However, city executives understand the benefits of an innovation ecosystem and are investing in building trust and establishing collaborative platforms. Successful adoption and integration of innovation can be influenced by factors such as confidence, trust, and transparency among actors, stable funding, strong political leadership, supportive policies, skills, knowledge, and citizen engagement. Trust and confidence among actors reduce resistance and increase cooperation, knowledge sharing and shared responsibility. Research shows collaboration and partnerships reduce risk, increase productivity, increase the reliability of the solution, and help to gather support and funding. Overall, the findings suggest three key recommendations for developing strong and sustainable innovation ecosystems: (1) collaboration among actors is crucial, so cities must develop collaborative and networking platforms, (2) service users are the ones who face the problem and experiment with ideas for solutions, so, encourage service user engagement, and (3) trust and transparency is crucial for support from actors and stable funding. Additionally, service-user participation in decision-making during the innovation process and pilot test strengthens legitimacy and supports implementation and adoption. Future research should specifically incorporate service user’s perspectives to better understand the innovation ecosystem in the public service.