INNOVATION IN A REGULATED SERVICE: The case of English housing associations

Abstract

This article explores the previously unexamined relationship between innovation and regulation in public service organizations. Innovation and regulation are conceptualized as different types of change - innovation is discontinuous change and regulation change to modify the behaviour of regulatees in relation to standards. Evidence is presented from a highly regulated public services sector - English housing associations, which are regulated by the Housing Corporation. In order to explain the behaviour of the case study housing associations and the regulator to innovation a two-stage innovation classification technique is developed and tested. Stage one draws upon social policy typologies, and stage two on attributes shown to influence innovation in other research. Housing associations' innovations are presented, categorized and classified. The findings indicate that innovation occurs at the borders of regulatory jurisdiction and that it is the tensions over these boundaries that are key drivers of innovation.