The Process of Technological Innovation in Public Services: A Multiple Case Study in Indonesia

Abstract

Innovation is seen as critical to the advancement of organisations and services alike. The innovation literature highlights the processes of managing change and the key components of the innovation process. Within these generic processes, there is also a general view that the commercial sector is more flexible and innovative when compared to public services, which are often perceived to be less entrepreneurial, resistant to change, and less inclined to integrate digital technologies. This study investigates the process of technological innovation within public sector organisations, focusing specifically on the Indonesian public services. It aims to provide a comprehensive and context-sensitive understanding of technological innovation process in public service practice. The study addresses the lack of robust theoretical frameworks suited to the technological innovation dynamics of public services in developing countries, offering both theoretical advancements and practical insights to support more effective technological innovation process. Employing a qualitative multiple case study methodology, the research draws on eight innovation cases within Indonesia’s Ministry of Finance. Data were collected through semi-structured interviews and document analysis, and subsequently analysed using a thematic analysis approach. The findings reveal that technological innovation process in public services is a complex, iterative, and contextually embedded process, shaped by seven contextual dimensions: administrative, political, socioeconomic, technological, regulatory, cultural, and temporal. A key outcome is the development of a Technological Innovation Process Model comprising four interrelated subprocesses: idea creation, technology creation, value creation, and knowledge creation. The study also identifies barriers that are dynamic and phase-specific, and classifies them as obstructive, reflective, interrelated, context-specific, predictable, and manageable. In response, four strategies are outlined: reducing intensity, reducing impact, accepting barriers, and sharing barriers. The study also introduces a Barrier Management Framework as a conceptual and practical tool for systematically identifying, analysing, and responding to barriers. The research concludes with policy recommendations to improve innovation capacity and outcomes in the public sector.