Understanding Policy Portfolios
A Policy Portfolio is a strategic combination of various policy interventions (levers) designed to address multifaceted policy problems.
In a previous post, we introduced the Policy Design Matrix as a vital tool for categorising and selecting policy levers based on their implementation timeline and the implementation mechanism.
In this post, we are going to look at how the Matrix and the Policy Levers combine to create Policy Portfolios.
What is a Policy Portfolio?
A Policy Portfolio is a strategic combination of various policy interventions (levers) designed to address multifaceted policy problems.
Similar to a financial portfolio that diversifies investments to optimise returns and manage risk, a Policy Portfolio combines multiple policy interventions to achieve a desired outcome effectively and sustainably.
A single policy is rarely sufficient to tackle intricate public issues. Instead, policy problems are solved through a coordinated mix of policies, implemented, monitored and adjusted over time.
Why are Policy Portfolios important?
Policy problems are inherently complex and dynamic, influenced by a complex soup of social, economic, environmental, and political factors.
Addressing these issues requires a nuanced approach that can adapt to changing conditions and unforeseen challenges.
A well-designed Policy Portfolio allows policymakers to:
Diversify risk - Implementing multiple policies means that the failure or underperformance of one can be offset by the success of others.
Enhance flexibility - A mix of short-term and long-term policies provides the flexibility to respond to immediate needs while working towards sustainable solutions.
Leverage synergies - Different policies can complement and reinforce each other, leading to more effective outcomes than any single policy could achieve alone.
Monitor and adjust - Continuous monitoring and evaluation of the portfolio enable adjustments based on performance data and changing circumstances, ensuring ongoing relevance and effectiveness.
Policy lever
A ‘Policy Lever’ is a tool that policymakers can use to influence outcomes in specific areas. Levers can take various forms, such as regulations, incentives, public awareness campaigns, partnerships, or direct interventions. They are the actionable components of a policy strategy, designed to bring about desired changes or address particular issues.
Policy matrix
The Policy Design Matrix is an essential visual tool that helps policymakers categorise policy options based on two crucial dimensions: the implementation timeline and the implementation mechanism.
Approaches to Policy Portfolios
When developing a Policy Portfolio, there are several strategic approaches to consider, each informed by the specific context and objectives of the policy problem:
Balanced approach:
This approach involves distributing policy levers across the four quadrants of the Policy Matrix. This balance ensures a mix of quick wins and sustainable long-term solutions, addressing immediate needs while also laying the groundwork for future improvements.
An example of a balanced Policy Portfolio
Example: Combining legislate (Immediate/Direct), influence (Immediate/Indirect), collaborate (Gradual/Indirect), innovate (Gradual/Direct), and educate (Gradual/Indirect) to address childhood obesity.
Legislate (Immediate/Direct):
Passing laws to enforce immediate public health measures, such as banning the sale of sugary drinks and junk food in schools to ensure a healthier food environment for children.
Influence (Immediate/Indirect):
Launching a public awareness campaign to quickly influence public behaviour, encouraging healthier eating habits and increased physical activity among children and their families.
Collaborate (Gradual/Indirect):
Partnering with schools, local governments and communities, and health organisations to develop and implement long-term initiatives such as school garden programs and regular physical activity sessions.
Innovate (Gradual/Direct):
Developing and introducing innovative solutions, such as new mobile applications that track children's physical activity and dietary habits, providing real-time feedback and engaging children in fun, healthy lifestyle choices through gamification.
Educate (Gradual/Indirect):
Implementing educational programs to gradually shift societal norms and behaviours over time, such as incorporating comprehensive health and nutrition education into school curricula to promote lifelong healthy habits.
This example demonstrates a balanced approach by utilising a mix of policy levers that provide immediate impact and foster long-term change in tackling childhood obesity.
Targeted approach:
Sometimes, the context requires a concentrated effort on a specific type of intervention. For instance, during a crisis, there might be a need for immediate and direct actions.
An example of a Policy Portfolio targeted at immediate and direct action
Example: In response to a public health crisis, prioritising immediate and direct levers like legislation, sanction, and mobilise to contain the situation swiftly.
Legislate (Immediate/Direct):
Enforcing new health laws, such as mandatory quarantine for exposed individuals, to ensure immediate compliance and prevent the spread of disease.
Sanction (Immediate/Direct):
Imposing penalties on individuals or organisations that violate public health orders, such as fines for businesses that do not adhere to safety protocols.
Mobilise (Immediate/Direct):
Quickly assembling and deploying medical personnel, resources, and equipment to the affected areas to provide immediate relief and support.
This example focuses on the Immediate/Direct quadrant, using levers that provide swift and decisive actions to address an urgent public health crisis.
Context-driven approach:
The selection and combination of policy levers are heavily influenced by contextual factors such as available resources, political climate, societal attitudes, and stakeholder mindsets. Understanding and evaluating these factors can guide the choice of levers to ensure they are appropriate and effective.
An example Policy Portfolio driven by a specific example context
Example: In a context with limited resources, high public support for environmental initiatives, and moderate political priority, focusing on levers like influence (Immediate/Indirect), research (Gradual/Indirect), educate (Gradual/Indirect), and tax (Immediate/Indirect) can yield significant results in reducing urban air pollution without extensive government expenditure.
Influence (Immediate/Indirect):
Launching public awareness campaigns to quickly influence public behaviour and build support for pollution-reducing initiatives. For example, promoting the benefits of using public transportation and carpooling through social media and community events, highlighting health benefits and environmental impact.
Tax (Immediate/Indirect):
Implementing a tax on non-electric vehicles to discourage their use and promote the adoption of electric vehicles. For example, increasing taxes on petrol and diesel cars to make electric vehicles more financially attractive to consumers.
Research (Gradual/Indirect):
Conducting ongoing research to gather data and insights that inform policy adjustments and innovations over time. For instance, studying the impact of different pollution-reduction measures such as low emission zones and electric vehicle incentives on air quality, which can be used to improve and adapt policies.
Educate (Gradual/Indirect):
Implementing educational programs to gradually shift societal norms and behaviours towards pollution reduction. This could involve incorporating environmental education into school curricula and community workshops to promote understanding and acceptance of sustainable practices and technologies.
This example shows how contextual factors guide the strategic selection of levers, combining indirect approaches that are cost-effective and leverage public support to achieve policy goals in reducing urban air pollution.
Our Policy Lever cards, which we use in Portfolio Reviews
Conclusion
Adopting a Policy Portfolio allows policymakers to strategically combine multiple interventions to address different facets of complex public issues. By diversifying policy interventions, policymakers can mitigate risks, enhance flexibility, and leverage synergies for more impactful outcomes.
The portfolio view provides a comprehensive birds-eye perspective of a collection of interventions, offering valuable insights into how different levers interact and complement each other. This holistic approach is crucial for developing strategies that are informed by the broader context and the dynamic interplay of various factors.
One of the key advantages of the Policy Portfolio approach is its flexibility. It enables the development of tailored strategies that can adapt to changing conditions and unforeseen challenges. Continuous monitoring and evaluation allow for timely adjustments, ensuring ongoing relevance and effectiveness. This iterative process not only enhances the impact of individual policies but also ensures their sustainability and adaptability over time.
Overall, a well-designed Policy Portfolio provides a structured and flexible framework for developing resilient solutions that can effectively respond to the multifaceted nature of public policy problems, regardless of the specific context.
Read more on navigating the complexities of policy portfolio management.
Need help?
If you would like help developing your Policy Portfolio, or assessing it for risks or missed opportunities, take a look at our Policy Portfolio Review service and get in touch!