Relationships have also been acknowledged as important within existing literature. The innovative capacity of local governments has been linked to the presence of strong internal and external networks (Newman et al., 2001). ‘Network governance’ describes (and sometimes attempts to prescribe) how policy-making and governance occurs in contemporary societies where governing conditions are fragmented, complex and multi-level (Lewis, 2011). The type of networks of interest here are social networks. They are fundamentally based on social connections between individuals and hence they consist of a set of nodes (people) connected to other nodes by interpersonal ties of some kind, be they friendships, work relationships or advice seeking. Innovation often takes place in the interstices, in the spaces between the formal structures – although governance structures shape and constrain opportunities for informal interactions and innovation capacity. Having spaces where individuals can meet each other, without the burden of formal responsibilities, positions and rules, is seen as crucial to innovation. Centrality Network centrality is a crucial concept within this field. There are several different types of centrality that are of relevance to this article. • In-degree centrality is a measure of the importance or prestige of individuals (Wasserman and Faust, 1994) • Betweenness centrality is a measure of which actors are positioned between other actors who are not directly connected (Wasserman and Faust, 1994) • Closeness centrality measures how close an actor is to all the other actors in a network Previous studies of innovation networks in municipal governments have shown that in-degree centrality is related to hierarchical seniority, and that innovators who are more adept at working through relationships outside formal structures are more able to get things done (Considine et al., 2009; Lewis et al., 2011). Further, being central in strategic information networks is considered to be more important than being central in advice networks (Considine and Lewis, 2007). The strength of weak ties Mutual dependency indicates something about the connectedness of the actors in a network: the positions that these actors take in the network and the ‘ties’ that connect them. This issue has been most famously addressed in terms of ‘strong’ and ‘weak’ ties (Granovetter, 1973). Strong ties can generate the trust that is necessary for the exchange and sharing of resources, but weak ties provide access to different resources. These are often seen as important to innovation as they allow actors to break out of the ‘groupthink’ that can occur in situations where everyone is similar and tightly bound into closed networks (Lewis, 2010). Weak ties are achievable where there is openness in the form of the free flow of ideas, knowledge and experiences. Structural holes Burt (1992) labelled specific network configurations, where actors have opportunities to act as brokers between other unconnected I n n o v a t i o n c a p a c i t y i n t h e p u b l i c s e c t o r actors by dint of their network position, as ‘structural holes’. A structural hole gives an actor the ability to use their position to play one competitor off against the other, provided that the competitors are not directly connected. Redundancy is a measure of the diversity of network ties. If an actor has many ties that provide the same information then they have a high level of redundancy in their network and this is regarded as inefficient since the same information could have been gained from a smaller number of contacts (Burt, 2005). Effective size is a second measure related to the brokerage potential held by certain individuals in networks. Social capital and trust Social capital is an embedded resource that is created through ties between people within networks. While individuals can hold financial capital and human capital, social capital is only generated by connections with other people. The notion of trust is often related to social capital and they are both often mentioned as factors that influence innovation (Walker, 2008; Lewis, 2010). However, it is important to separate distinct network configurations from the assumed values, emotions and actions arising from these. Two important authors with very different views on social capital are Ron Burt and James Coleman. Burt (2005) claims that social capital is a metaphor for social structure, defining a form of capital that generates advantages for some individuals and groups. His focus is on the competitive advantage that is to be gained if you are the link between otherwise unconnected actors or groups (structural holes) and so able to access different resources. In contrast, Coleman (1988) highlighted closure and density in networks as providing support and resources. The preceding discussion indicates that while there are several theoretical and observed associations between network concepts and innovation, the relationship is not a straightforward one. Indeed, it seems that it is some blend of centrality, strong and weak ties, brokerage and trust, which provide the necessary network capacity for innovation. It is also apparent that certain A history of innovation Commonwealth Governance Handbook 2014/15 45 Innovation means producing something new: that is – doing things differently or in a new form. Looking at the concept in a historical perspective, it is an economic phenomenon, having resulted in new ways of producing more for less. It is the process of invention, whether of a product, a technology, a service, a new type of production, a new process or a new form of collaboration. It dates back to Adam Smith even though it is Schumpeter (1934) who usually takes credit for the idea of ‘creative destruction’. Innovation is seen as the process of bringing in something new that breaks with existing practice and routines. Skills that have obtained some type of routine and practice are what define capabilities, therefore, innovation challenges an organisation’s accumulated capabilities. Such is argued by Osborne and Brown (2011), who refer to innovation as ‘a transformative discontinuity with existing practices’. This specific feature of innovation has often been referred to as a competency struggle between path creation and path dependency.
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