Enabling Transformative Change: Investigating Capabilities for Sustainability in City Management

Public organizations are increasingly struggling with sustainability challenges for various reasons. First, being complex and cross-cutting by nature (Dunlop and Russel 2012), sustainability extends to structures and processes in different levels and branches of organizations making it an issue of governance and management (Dinica 2018). While the pivotal role of public sector in promoting sustainability has been highlighted in previous literature (e.g., Jordan and Lenschow, 2009; Leuenberger and Bartle 2014; Fiorino 2010; Dunlop and Russel 2012), there is a lack of understanding and focus especially on the strategically critical role of local government in the field of sustainable development (e.g., Hoornweg et al. 2011; Krause, Feiock, and Hawkins 2016; Castán Broto, Trencher, Iwaszuk & Westman 2019). Secondly, promoting sustainability has been difficult for the dual role of cities in solving and contributing to sustainability challenges. This means that cities constitute both problems and solutions to sustainability challenges (Grimm et al. 2008). Cities are local scenes where the global ecological crises, e.g., forest fires, drought and pollution concretize, but they are also sites where innovative activity to mitigation and adaptation happens. For example, as Grimm et al. (2008) put it, the local nature of biodiversity loss and climate crisis make cities represent microcosms of global changes, making them interesting cases for understanding the dynamics of sustainability and responses to change. However, there is scarce understanding about how to promote these new aims in public management. Our study contributes by identifying a set of capabilities that enable a city to promote transformative change toward sustainability. Our findings are based on an investigation of an extensive development project, where the top management of the second biggest city in Finland, Espoo, developed a vision of a new management approach for comprehensive sustainability. Our empirical material includes workshop and individual interview data gathered during fall 2020 and spring 2021 during the impact-driven governance project. Participants in the workshops and interviews were the city mayor and other senior members from strategy, governance, data management and service development units. In total 151 pages of transcribed text was analysed. We analysed the text following the Gioia method (Gioia, et al., 2012). The Gioia method, especially used in management and organizational studies, is used to study people’s interpretations of event. Our findings suggest that promoting transformative change requires dynamic capabilities (Kattel & Mazzucato, 2018; Teece et al., 1997; Piening, 2013), which drive proactive change and agile adaptation to evolving circumstances. The emphasis on sustainability is associated with rapidly changing values, political priorities, and regulations. Furthermore, knowledge of environmental and social problems and solutions accumulates constantly (refs). In such conditions of ‘environmental turbulence’, ordinary efficiency-oriented capabilities are often found insufficient and public organizations should invest in developing dynamic capabilities for managing change processes to meet with new external demands (Piening, 2013), led by managerial efforts (Felin & Powell, 2016). Our finding suggest implementing a reflective management cycle, where sustainability goals are formulated, operationalized, implemented and continuously re-evaluated in light of new knowledge and diverse understandings of value.