Welfare service system productivity: the concept and its application

Purpose - The purpose of this paper is to examine productivity at the level of a welfare service system. This approach aims at optimizing the performance of the whole system and to avoid sub-optimizing the production of individual services or organizations. The paper also aims to develop a definition for the concept of welfare service system productivity and demonstrate its applicability. Design/methodology/approach - First, a literature-based definition of welfare service system productivity is produced. This definition is applied empirically in a case service system. Empirical data were collected by interviewing a total of 17 managers either in the Social Service Department (City of Helsinki, Finland) or in external service provider organizations. Findings - The findings show that the system-level productivity concept is a challenging phenomenon in practice. The practitioners representing different parts of the system could not easily see things the same way. This study also shows that the concept can be applied as an analytical tool. The key benefit of lifting the level of analysis from organizational to system level is that new kinds of challenges and areas for improvement are revealed. Practical implications - Despite the conceptual nature of the paper, the purpose is to comprise a managerially relevant approach that helps to increase understanding about the issues affecting system-level productivity and to identify the potential for productivity improvements in a welfare service system (e.g. by locating productivity barriers). Originality/value - The existing literature on public sector productivity is mainly concentrated on individual organizations whereas system-level approach is given little attention.

[1]  Oliver Groene,et al.  Integrated care , 2001, International journal of integrated care.

[2]  A. Hodgkinson,et al.  Productivity measurement and enterprise bargaining – the local government perspective , 1999 .

[3]  Controlling externally autonomised entities by Dutch local governments , 2011 .

[4]  H. Vondeling.  Economic evaluation of integrated care: an introduction , 2004, International journal of integrated care.

[5]  Paul P. Maglio,et al.  Steps Toward a Science of Service Systems , 2007, Computer.

[6]  Harri Laihonen,et al.  The role of intellectual capital in non‐profit elderly care organizations , 2010 .

[7]  Stephen L. Vargo,et al.  On value and value co-creation: A service systems and service logic perspective , 2008 .

[8]  Runo Axelsson,et al.  Evaluating integrated health care: a model for measurement , 2005, International journal of integrated care.

[9]  Brian H. Kleiner,et al.  New Developments in Performance Measures of Public Programmes , 1994 .

[10]  Kirk L. Wakefield,et al.  Customer response to intangible and tangible service factors , 1999 .

[11]  Peter Jones,et al.  Service productivity: Towards understanding the relationship between operational and customer productivity , 2004 .

[12]  T. P. Hill.  On Goods and Services , 1977 .

[13]  S. Shortell,et al.  Health care management , 2013 .

[14]  Ananthanarayanan Parasuraman,et al.  Service quality and productivity: a synergistic perspective , 2002 .

[15]  M. Porter.  Competitive Advantage: Creating and Sustaining Superior Performance , 1985 .

[16]  Graham Clark,et al.  Service Operations Management: Improving Service Delivery , 2005 .

[17]  Mary Jo Bitner,et al.  Services Marketing: Integrating Customer Focus Across the Firm , 1996 .

[18]  Ellen Doree Rosen,et al.  Improving Public Sector Productivity: Concepts and Practice , 1993 .

[19]  B. S. Sahay.  Multi‐factor productivity measurement model for service organisation , 2005 .

[20]  C. Grönroos,et al.  Service productivity: Towards a conceptualization of the transformation of inputs into economic results in services , 2004 .

[21]  Aki Jääskeläinen,et al.  Productivity Measurement and Management in Large Public Service Organizations , 2010 .

[22]  Jean-Paul Flipo,et al.  On the Intangibility of Services , 1988 .

[23]  D. A. Horne,et al.  A perspective on client productivity in business‐to‐business consulting services , 2001 .

[24]  Stephen L. Vargo,et al.  Evolving to a New Dominant Logic for Marketing , 2004 .

[25]  M. Haglind,et al.  Development of value networks-an empirical study of networking in Swedish manufacturing industries , 1998, IEMC '98 Proceedings. International Conference on Engineering and Technology Management. Pioneering New Technologies: Management Issues and Challenges in the Third Millennium (Cat. No.98CH36266).

[26]  Helinä Melkas,et al.  Defining and measuring productivity in the public sector: managerial perceptions , 2010 .

[27]  David Wilkinson.  Whole system development ‐ rethinking public service management , 1997 .

[28]  G. Callender.  Alignment of inter-agency supply chains to enhance public sector performance management , 2011 .

[29]  Stephen M. Shortell,et al.  Health Care Management : Organization Design and Behavior , 1997 .

[30]  J. Peppard,et al.  From value chain to value network: Insights for mobile operators , 2006 .

[31]  Paul P. Maglio,et al.  The service system is the basic abstraction of service science , 2008, Proceedings of the 41st Annual Hawaii International Conference on System Sciences (HICSS 2008).

[32]  Antti Lönnqvist,et al.  Designing operative productivity measures in public services , 2009 .