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of Discussion with Ted Kolderie
8301 Creekside Circle,
Bloomington, MN 55437
Friday, November 6,
(Chair); Janis Clay, Marianne Curry, Paul Gilje, Jim Hetland, Jan Hively,
Dan Loritz, Tim McDonald, Wayne Popham (phone), Clarence Shallbetter, Bob
Context of the meeting—
The Caucus recently finished a statement for its future—an operating
statement, a philosophical statement—that is presently being circulated.
Today’s meeting is to spend some time on examples of redesign, and there
is no better speaker for this than Ted Kolderie. The weekly discussions in
the Civic Caucus will continue to take on this theme of rethinking how the
public sector is arranged and operates, which our speaker today likes to
describe as doing more, if possible for less, by doing it differently.
Welcome and introductions—Verne
introduced Ted Kolderie, founding
partner, Education|Evolving; former executive director, Citizens League;
former senior fellow, Humphrey Institute, University of Minnesota; and
former reporter and editorial writer, Minneapolis Tribune. Verne met Ted
while Verne was executive director at the Citizens League, and Ted was a
reporter at the Tribune. Ted one of the most thoughtful people around,
Verne said. “Here was a thinker, pondering things more than usual.” As
Verne prepared to leave his tenure at the League, he approached Kolderie
to consider stepping in. No, was the reply. After some additional
persuasion, he eventually relented.
Comments and discussion—During
comments by Kolderie and in discussion with the Civic Caucus, the
following points were raised:
1. Many terms can be used for redesign--Kolderie
began by saying that the phrase redesign really is “arbitrary—more a term
than a concept to be defined.” You could use other terms. “I learned a
long time ago that ‘reform’ doesn’t work,” he said, as a concept. It is
too worn-down. In his eyes he sees redesign as making something more
effective, but less costly. Not a case of the same approach, done better.
It involves coming at a problem with a new or different concept.
2. Long time interest in redesign--He
has been in this business in one way or another for all of his
careers—from the papers, to the Citizens League, to his time at the
Humphrey Institute and now with the Center for Policy Studies and
Education|Evolving. The latter of those—E|E—is an application of the idea
that public systems can be made to work better by changing (sometimes
small) components of their architecture, or simply by rethinking the
delivery of services. Education|Evolving works in Minnesota and elsewhere
to help make public education work better, by working differently.
3. Different forms of redesign--There
is a spectrum to redesign of organizations, he said—of the way things are
done. On one end you have performance improvement, through refinement or
enhancement of what is already in place. On the other end there is what
Walt McClure calls “macro-system design,” or “large-system architecture.”
This is the realm of those who design policy: the board of an
organization, the state legislature. They are the ones with the capacity
for the right side of the spectrum.
Neither is inherently
better than the other. They’re both necessary, and important.
4. Redesign not always welcome--It
can be difficult to make progress on redesign. People get used to things
as they are. Interests become vested in the present state of a system.
There is a lot of money to be made by selling better service for the
alternatives to this,” he said. “Alternatives is the key word.” ,The
Citizens League and the Upper Midwest Council cooperated on the Public
Service Options project in the 1980’s. Britain, he said, seems not to
think so much about alternatives; seems to think that if it gives big
systems 'targets' and limits their cash they will automatically go find
better ways to do things. Not sure this works well.
5. Focus on the "how"--Endlessly
restating 'the problem' and endlessly reaffirming 'the need to do better'
doesn't move anything ahead. The discussion needs to focus on the 'How?'
Eight categories for redesign of services
--Kolderie described eight different categories into which redesign
ideas can be placed:
This is ‘load-shedding,’ or cutting. He read a clip from the Gilbert MN
Herald in 1961 about the city saying it would no longer cut boulevard
lawns or plow gardens at city expense. Wilder no longer operates public
baths in Saint Paul. This isn't a big category. But once in a while
something can simply be dropped.
The best way to hedge against high-cost services is simply to avoid them,
or when possible delay their onset. Health care provides one of the most
significant opportunities for prevention. When she was in this past
September, Mary Brainerd (CEO, Health Partners) told the Caucus that up to
80 percent of costs in health care are for conditions that are either
delay-able or preventable. We have ‘medical-hospital services,’ not a
system of health-care. We treat, we don’t prevent. This example of
prevention is prominent in the current national debate about 'health-care'
In his 'redesign' seminar at the Humphrey
Institute, Kolderie said he’d ask the students to describe the system of
'fire control'. Clearly fire-suppression -- squirting water on the flames
from the street -- is a small part of that system. Most of it is
prevention. Fireproofing buildings, safety measures, sprinklers to
suppress it if one does start, inspection.
There are always ways to do service less expensively. Hospice care rather
than hospital care at the end of life, is a well-known example.
You can change how you do things. He shared a
story about a community group in Chicago that was calling for a better
hospital-medical service in their neighborhood. They were dealing with too
many car accidents and dog and rat bites. But after some thinking city
leadership instead worked to 'calm' the traffic and remove the animals.
They got to the root of the problem.
Substitution applied to transit may include
carpooling or vanpooling in place of conventional bus service on regular
routes and schedules.
Supported self-help is substitution: instead of
hiring a In place of buying expensive professional service you put in the
labor and a company provides the materials, designs, equipment and
know-how. Think about gardening, Toro, Scott's lawn care. Betty Crocker
in your kitchen.
d. Competition: This is
choice. Contracting is a useful approach, if it comes in competitive form.
Competition is not itself a different way of doing a task, Kolderie
emphasized, but an approach for achieving efficiencies in spending.
Contracts don’t only have to be issued to private enterprises. There can
be public-to-public contracts, too: between municipalities or agencies.
It matters how competition is facilitated,
Kolderie said. When he covered Minneapolis City Hall for the Tribune the
city contracted for vehicle-towing services. To bid, a company had to
show it had both trucks and an impound lot. Nobody was willing to get
an impound lot just so they could bid. So the contracts went to the same
operators, despite cars being damaged and broken-into.
Then the city decided to take a different
approach. The city acquired the impound lot; space under I-94. Then it
divided the city into quadrants. . All you had to have to bid was trucks.
The next year, competition exploded. “They were towing so much,” Kolderie
said, “the city had to tell them to lay off.” This was a successful
redesign: better service at a lower cost.
Make the fullest use of personnel in (whatever) service. The website of
the State Fire Marshal shows just under 800 fire services in Minnesota.
Eleven are full-time departments. Over 700 are all volunteer; 42 are
Denmark the company Falck has long contracted with municipalities for fire
service. It also runs emergency and non-emergency ambulance, tows wrecked
cars, handles emergency calls. Filling up its employees' time lets it pay
public-sector wages. In America some of this is visible in the way fire
departments have gone into the para-medic business.
Ride sharing is utilization too. The roads are
filled with cars themselves mostly driver-only. They are under-utilizing.
Give an individual, organization, or agency the money and let it keep what
it does not need to spend.. As superintendent in Milwaukee Howard Fuller
capitated schools for substitute teachers. Spending on substitutes went
down. Similarly, in Florida, schools required to pay their own bills for
light and air-conditioning began conserving electric power to generate
money for school activities.
Often government 'gets something done' not by running the service itself
but by requiring others to meet the need at their own expense. The city
does not clean restaurants: It requires owners to clean their restaurants.
The city plows snow on the streets, but requires homeowners to shovel
their sidewalks. Regulation creates incentives, and incentives influence
how people and organizations behave. They can work for good or ill.
Walter McClure once wrote a wonderfully clear paper -- in the context of
the health-care debate -- explaining that the proper response to market
failure (which does exist) is not regulation, but 'market reform'. There
is also regulatory failure, and this is worse -- because
This redesign opens up a system, creating the capacity for doing things
differently, more effectively, and better meeting needs. Think about
Alfred Kahn, when chair, getting the Civil Aeronautics Board out of
regulating routes and fares on the airlines. The airline system changed
dramatically. More people flew; (in real terms) fares fell.
7. Applying redesign in the 2010 Legislature?--A
member asked Kolderie for his thoughts on where legislators might look to
redesign, to maintain and improve services and save money, in the upcoming
session. “Redesign is longer-term,” he replied. “The question is, where do
you get started on redesign? We have a habit of starting this work when
it’s raining, then shelving it once things start improving.” Chartering
was a system-level redesign in K-12 education. Now Education|Evolving is
proposing that the new schools be designed to get away from courses and
classes, so students can either take more time or, if they're able, can
move faster. If more students finished secondary school, moved on to
college or to work, at age 16 the savings could be quite substantial.
Building momentum for redesign--A member asked, Where are we
now with momentum for redesign work? A couple of groups are now continuing
the work begun by local foundations in the "Bottom Line" project earlier
this year. . One is working on redesign proposals, the other examining how
to get redesign activity going in the state, broadly and on a continuing
the Civic Caucus fit into this? “ Just what you are doing,” he said,
“bringing in public officials and asking them questions that make them
9. Incremental change or comprehensive change--To
conclude, Kolderie said it is important also to think about how redesign
gets enacted. “There’s an impulse to be ‘comprehensive,’” he said. “So
often the notion is that the whole old ‘system’ will be taken out and a
whole new one put in. This never happens.
practical way to get even radical and comprehensive change is to open the
system just enough to let something very different come in. “Let those
who prefer to do something one way instead of another do so. Don’t let the
status quo suppress it. Over time the new model will develop—if it is
sound—and the old will decline. This is the way most systems change. Think
about telecommunications, and about computers. Some farmers thought God
meant for fields to be plowed with horses, but over time tractors replaced
horses. This process does take time. But realistically there isn’t any
other way. ‘Taking time’ also offers the opportunity to improve the
new model. The ‘different’ is never very good at the start. Again, think
about computers, or the one-pound cell phone.”
Looking at redesign from the consumer's view, not only the producer's view--Redesigns
come in different forms, he emphasized. “Some redesign just improves the
existing model without changing it much. Some involves radical change.
Radical change requires thinking in new ways. A well-known economist
insisted there cannot be a concept of productivity in services. He pointed
to the string quartet. "What would it do, to increase productivity?" he
asked, 'Play the Mozart twice as fast? Drop the second violin? This seemed
irrefutable—so long as you thought about it from the quartet’s point of
“Now think about it from the listener’s point of view: (a) driving to the
concert hall, paying to park, buying a ticket every time for every seat,
listening to what might be an indifferent performance, then driving. Or
on the other hand: (b) buying a CD once, sitting in a quiet, private
living room at whatever time is convenient, no driving, no parking, no
crowd, listening to the best performances ever recorded. Tell me there’s
no productivity here,” Kolderie said. “You just have to be willing to
contemplate a different way of getting to the result.”
11. Thanks--On behalf of the Civic
Caucus, Verne thanked Kolderie for meeting with us today. .