In this chapter we develop a framework for analysing the challenge of dealing with innovation in hybrid public services. The main objective of the chapter is to analyse how hybridity can lead to innovation. Hybrid organisations are defined by the literature as organisations that combine multiple organisational identities and forms (Battilana and Lee, 2014), multiple institutional logics (Jay, 2013; Battilana and Lee, 2014) or sector principles (Billis, 2010). For the purpose of this chapter we define hybrid organisations as organisations that combine two or more institutional logics. An institutional logic is a socially constructed pattern of cultural symbols and material practices by which individuals and organisations provide meaning to their daily activity (Thornton et al., 2012, p. 2). For organisations, logics may translate into organisational ‘principles’ (Billis, 2010) or rules of the game. In this chapter we use logics and principles as almost interchangeable concepts but for us the overarching phenomenon is logics. The example of hybridity we analyse in this chapter is the growing ‘servitisation’ of public services. Servitisation we understand as a new institutional logic that leads public services to emphasise user-centric innovation approaches. Servitisation and the user-centric logic represent a move towards market sector principles and therefore an increase in sector hybridity.
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