UK Industrial Strategy, November 2017

The Behavioural Insights Team (BIT) has just published its response to the new UK Industrial Strategy and both BIT and I are pretty positive about it. Let me tell you why and then, let me tell you what’s still wrong with it.

Experimentation and Evaluation

The strategy (see link at the bottom of this page) recommends taking an empirical approach to policy making.

This is not so much to determine policy objectives but to test what works in terms of implementing objectives and making sure that there is some soft of feedback loop between implementing, evaluating and re-formulating how the policy is implemented. This is great, not just because it brings scientific method into policy but because it accepts that the social world is complex and you often cannot anticipate how a policy will play out in practice.

How many times have policies failed, not because the intentions are bad but because of the unanticipated consequences (do I have to say ‘Universal Credit’ to make the point?)? Why is it not a requirement of all legislation to monitor its consequences in a systematic way and sharpen it up around the edges or abandon it (dare I say Brexit – see ‘Is the referendum decision definitive?’)?. Politics is still unfortunately a matter of who shouts the loudest – see ‘Policy Regulates Behaviour’.

Using Data to Improve Government Services

The strategy argues for better use of data (especially ‘big data’) to improve government services. This is similar, in principle, to the first point about bringing science into policy. It’s another strand of taking an empirical approach.

My observation here is that its not just data. It’s information. Raw data requires interpretation. Raw data contains many biases in what is collected, the way it is collected and the way it is reported and used. For example, even now it is recognized that machine learning, based on historical training data, can build in historical biases and can embed in algorithms, biases that on reflection, we might prefer not to perpetuate. Therefore, by all means use data to improve services, but that’s not enough. There may need to be several layers of analysis above the raw data, looking at it as part of a large and complex system, before it can be used meaningfully.

Making Markets more Dynamic

One of my favourite activities is identifying how companies (and public services) play on our deficiencies in energy and effort, ability and cognition. We are slow to change suppliers even when there is a better deal. We are confronted by confusion marketing that makes it nearly impossible to compare deals. Complaint mechanisms make it exceedingly difficult to get remedies and effect changes in company procedures. I have a particular gripe regarding how companies mis-use their power to affect credit ratings when people have genuine grievances. And the regulators are no better, often putting further obstacles in the way of effecting change. This results in a severe lack of accountability in the running of both commercial companies and public services (see ‘It doesn’t end with Grenfell’ and ‘society can drive you mad’).

The use of feedback to improve product and service design and management procedures is a valuable and overlooked resource. Instead of defending against complaints, institutions need to use complaints as a primary mechanism of re-designing and improving services.

But beyond feedback there is an ethical dimension. Businesses that mislead and manipulate consumers do a disservice to everybody including themselves. We need to re-think economics so that organizations are measured on the true value they deliver and not on their ability to cut costs or provide returns to directors and shareholders. See ‘True Value’.

Innovating at a User and Local Level

In a recent report on local government, a team I am part of, recommend ‘Innovation at the user and local level’. See ‘Local Government’. In a world in which 8 people own over half of the world’s resources, change will only happen from the ground up.

Managing the Managers

It is not just that managers (especially middle managers) in the UK need to be better trained. They also need to be better and more authentic leaders. They need to encapsulate the values that we can admire and respect and earn their place, not just because they are good at cutting costs or making money, but because we acknowledge that they are doing their best to make society a better place. See ‘Is it Time we had authentic leadership?’.

And in relation to ‘productivity’ we have got it all wrong. We must go much further than this to redefine productivity to genuinely reflect value. Productivity should not be measured in terms of economic indices like Gross Domestic Product (GDP). We have to measure where genuine value is added (again see ‘True Value’) and consider other ways in which the wellbeing of society can be measured (see ‘The New Economics’).

Finally

Let’s praise the White paper on the New Industrial Strategy. It’s going in the right direction. But at the same time, let’s recognize that it’s not going far enough.


References

Article, The UK’s new Industrial Strategy: a modern foundation for economic growth – Robbie Tilleard, Nida Broughton and Elisabeth Costa, November 2017
BIT Commentary on the UK Economic Strategy, November 2017

Article, The UK’s new Industrial Strategy: Access to Government White Paper, November 2017
UK Government White Paper on the UK’s Economic Strategy, November 2017


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Rod Rivers' passions include writing about economics, psychology, and philosophy; listening to Radio 4 and watching TED and YouTube videos; engaging in conversations with friends and colleagues, and re-experiencing the world through the eyes of his two teenage sons. Living in the 21st century is a huge privilege.

Posted in Accountability, Economic theory, Economics, Inequality, Politics, Science, Strategy, Systems theory, Value, Values, Well-Being, Wellbeing

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About This Blog

This series of blog postings takes a multi-disciplinary approach to social policy, bringing together ideas from psychology, economics, neuroscience, philosophy and related subjects to inform policy makers and other professionals about how we might think in new ways about the individual and society . There are some easy ways to read it:

• Very Easy – Just read the blog titles: Most blog title are propositions that the blog content attempts to justify. Just reading the names of the blogs in order from first to last will provide an overview of the approach.

• Quite Easy - Just read the text in bold. This brings out the main points in each posting.

• Easy - Just watch the videos. This is easy but can take a while. The running time of each video can be seen in the caption above it. Hover over the video to see the controls – play and pause, large screen, and navigate around.

• Harder – Read the whole blog. Useful if you are really interested, want to learn, or want to comment, disagree with the content, have another angle or whatever. The blog is not being publicised yet but please feel free to comment and I will try to respond if and when I can.

The blog attempts not to be a set of platitudes about what you should do to be happy. In fact, I would like to distance myself from the ‘wellbeing marketplace’ and all those websites/blogs that try and either sell you something or proffer advice. This is something quite different. It takes as its premise that there is a relationship between wellbeing, needs and control in both the individual and society. If needs are not being met and you have no control to alter the situation, then wellbeing will suffer.

While this may seem obvious, there is something to be gained by understanding the implications of this simple idea. We are quite used to thinking about wellbeing in terms of specifics like money, health, relationships, work and so on, but less familiar with dealing with the more generic and abstract concepts of need and control.

Taking a more abstract approach helps filter out much of the distraction and noise of our usual perceptions. It focuses on the central issues and their applicability across many specifics that affect how we think and feel.

The blog often questions our current models of the way we think about the human condition and society. It looks at the things we all know and talk about – decisions and choices, relationships and loss, jobs and taxes, wealth and health but in a way in which they are not usually described. It tries to develop a new account, that draws on a broadly based understanding of what we now know from science, culture and common sense.

If you are looking for simple answers you will not find them here. This is not because the answers are complex. It is because the answers are not necessarily what you expect.

If you are looking to explore in some depth the nature of wellbeing and how it is influenced by what you can control, and what others can control that may affect you, then read on. Playing through some of these ideas into the specifics of policy, at the level of society and the individual, will take time but I hope you will see the virtue of working from first principles.

When walking through any landscape different people will see different things. A geologist might see an ice-age come and go, forming undulations in its wake. A politician might see territorial boundaries. Somebody else may see a hill they have to climb together with the weight of their back-pack.

Taking a perspective of wellbeing and control is different from how we normally look at the world. It's a deeper look at why and how things happen as they do and the consequences on wellbeing. It questions the relationship between intention and outcome.

We normally see and act through the well-worn habits of our thoughts and behaviours as they have evolved to deal with things as they are now. We mainly chose the easy options that require the least resource. As a survival strategy this generally works well, but it also entrenches patterns of thought, behaviour and emotion that sometimes, for the benefit of our wellbeing, need to be changed. When considering change, people often say ‘well, I wouldn’t start from here’. And that’s the position I take. I am not starting from the ways things are or have evolved, but from the place they might have been had we known what we know now and had designed them.

The blogs argue that, in an era of specialisation, we have forgotten the big picture – we act specifically and locally within the silos of our specialised education and experience. We check process rather than outcomes. We often fail to integrate our knowledge and apply it to the design of our social and work systems (as well as our own thoughts and behaviours).

To understand society we first need to understand the individual and to this end, a psychological account of how we feel, think and behave based on notions of wellbeing and control is proposed. And not in an abstract airy-fairy kind of way, but as a more or less precise theory that forms the basis of a predictive and testable computational model. The theory is essentially about how, both as individuals and society we manage multiple (and often conflicting) intentions in real time within limited resources. I call this model 'the human operating system'. This is like a computer operating system except that it is motivated by emotions, modulated by reason and is expressed in the language of mind and its qualities of agency and intentionality.

Just as in the mathematics of fractal geometry, complex structures can emerge from simple rules. The explanation given of the interplay between emotions, physical bodily states, thoughts and behaviours shows how much of the complexity in the individual can be accounted for by a set of relatively simple rules. This can be modelled using a system of symbolic representation and manipulation involving intentions and priorities operating in a complicated and changing environment.

The language and models that we use to understand the individual can also be applied to organisations and other structures in society. Through an understanding of what makes for wellbeing in the individual we can also understand what makes for better wellbeing in society generally. The focus, therefore, is on understanding the individual and then using that understanding to inform how we might think about other structures in society and how all these structures relate to each other from the point of view of wellbeing, shifting patterns of control and the implications for social policy.