Four Things Government Can Learn from Tri-Sector Innovation
By Daniel Honker, Impact Innovator
I’m a public sector creature. I’ve worked in or for different levels of government my whole working life, helping government innovate, collaborate, and provide better services for people. So when I started working for NewImpact in 2021, I told friends and former colleagues about the tri-sector approach to innovation. The most frequent response I got: “So, that’s like public-private partnerships, right?”
Not exactly.
Tri-sector is relatable enough as a term, but it’s been a journey to understand what tri-sector can really mean. Naturally, I’ve been drawn to think about what it could mean for government. So, I want to share some reflections on that question after applying the tri-sector approach over the past year.
Quick Tri-Sector Primer
Tri-sector is all about aligning resources and self-interests. It’s about finding viable, sustainable ways to share resources between public, private, and social sectors, and the organizations within them, so that we can accelerate problem finding and problem solving. Think of a broad definition of “resources”—anything that people use in the process of creating value or providing services. These include data, organizational capabilities, refrigerators, building materials, and of course funding (more on that later).
So what can government learn from tri-sector innovation?
Here are four things:
1. Resource Sharing Doesn’t Have to be Complicated
Like I mentioned earlier, public-private partnerships (PPPs) or joint ventures might come to mind as a cross-sector collaboration. PPPs (“bi-sector?”) typically involve contracts between government and business that dictate risk- and revenue-sharing terms for large, complex projects like building highways. Think of these as active ways to share resources–typically more explicit, where all parties are fully aware and actively involved in the arrangement.
There are also passive ways to leverage resources, where no money changes hands and no contracts are signed. Propel, for example, built a business on giving SNAP users more ability to use their benefits and grow their buying power. Public programs and data sets are core to their model—for example, using public open data to locate farmers markets that double SNAP benefits, and integrating that data into the SNAP user’s interface to make their dollars go much further while increasing access to healthy food. No long memorandum of understanding or vendor agreement required—just a willingness to see a market opportunity where others didn’t, and tools to help bring it to life.
Our recent project to help Black homebuyers proposed a blend of active and passive resource sharing. It includes a shared revenue model and collaborative governance mechanisms. But also calls for organizations to use their communication channels to reach Black households. No MOU required there.
2. Yes, the Government Has Self-Interests, Too!
The key to leveraging resources is making it work toward the self-interest of all sectors. Since the public sector works for public benefit and general outcomes, we sometimes think that government does not have a “self-interest”. But it does. These self-interests can be about achieving a policy goal or outcome like increasing youth employment or solving homelessness. They can also be about internal issues or business needs, like improving efficiencies; making services more accessible, or expanding the use of apprenticeship standards to new industries. In the case of the Propel example above, the model served the Federal Government’s policy interest in increasing access to healthy food, as well as its business interest in making its SNAP program more usable and accessible.
3. Government is a HUGE Resource Provider—Particularly of Data.
I can’t underscore this enough. Across our projects and other tri-sector success stories, we’ve seen a consistent pattern in public sector data and standards being critical assets to new business models. Equity-minded fintech players like MoCaFi can integrate with public benefit programs and expand access to benefits because they have access to those programs’ data. An employer building an apprenticeship program can use the Department of Labor’s occupational standards even if they are not part of the registered apprenticeship system. This underscores the importance of public data and standards–not just in service of transparency, but as platforms for innovation.
4. Tri-sector Innovation Builds on Human-Centered Design & Other Innovation Approaches the Government Is Already Adopting.
Governments at all levels are increasingly using design thinking, agile, lean startup, and other sensemaking problem solving methods in their work. Resource leveraging overlays well with those approaches. Those familiar with human-centered design will recognize an impact journey (an adaptation of a journey map) to understand the experience of the impacted person, and a systems map to visualize the macro-level drivers of outcomes. For example, this impact journey shows the challenges a young adult can face as they explore apprenticeship, while this systems map illustrates factors that affect the availability of apprenticeships and a young adult’s access to them. Those familiar with the business model canvas should see familiar patterns in the tri-sector innovation canvas. These tools–and the mindset that powers them–can easily fold into innovation approaches that the public sector is already using.
What Government Needs to Recognize About Roles of Other Sectors
Government is where we set public priorities and strive to realize outcomes for all of society. But government cannot “do it all alone”—even though it often thinks it can or must (and we the people often expect it to). What’s more, public leaders can get stuck in thinking that the other sectors simply cannot align on public goals–because business is too focused on profit, or because nonprofits are too fragmented and unscalable.
But government must leverage the unique strengths of the other sectors. The social sector is often on the front lines of societal challenges, with critical community relationships and the ability to convene and connect. Nonprofits can also play an important role in innovation since they are mission-focused but often have more flexibility than government. In our capitalist system, the private sector is the engine for sustainable progress. Businesses and entrepreneurs can help government experiment with different approaches and find viable business models that achieve impact at scale.
Being a creature of the public sector myself, I know the pressure government leaders feel to provide leadership on public issues. We bestow government with authority, and this is a critical role. But as challenges grow more complex, a tri-sector mindset can help government recognize where other sectors are leading toward shared goals, and what resources and alignment it can provide toward those aims.
