Case Studies in Social Innovation

October 2008

By David Hetherington

The employment services sector in Australia is at a critical juncture. The third contract round of the Job Network coincides with a commitment by the new Federal Government to the principles of sound market design.

These principles include the alignment of incentives between providers, users of services and taxpayers; generation of new sources of investment; removal of barriers to entry; and transparent information on service quality.

An important goal of the redesign of this market is to stimulate greater innovation amongst providers. Like any investor, government wants to achieve the biggest bang for its buck and it realises that its return on investment is restricted by a top-down, prescriptive approach to provider behaviour. Put simply, providers will be able to place more people in jobs if they are allowed to tailor programs to local circumstances. Avoidance of a failure at all costs must be replaced by a willingness to experiment and
to err in the pursuit of success.

This background paper offers an overview of social innovation and three case studies of successful social innovation projects. The paper is intended to illustrate the principles of social innovation for organisations which may be considering an application to the Innovation Fund, the Federal Government’s primary policy tool to stimulate innovation in employment services.

The three case studies have been chosen because in each, providers have successfully applied social innovation to the provision of work to jobseekers. They cover both Australian and international experiences, and emerging new initiatives as well as well-recognised, longstanding ones. The paper seeks to draw out the common elements that have allowed these projects to achieve enduring success.