Stakeholders, Citizens, and Co-Production

Why this matters in public value

A public health team can fund every clinic and staff every hotline it can afford, and a vaccination campaign will still fail if too few people roll up their sleeves. A local authority can build a flawless recycling collection rota, and the recycling rate will still stall if households do not sort their waste correctly. A tax authority can simplify every form, and revenue will still leak if taxpayers do not believe the system is fair enough to comply with voluntarily. In each case, the organization supplies necessary but not sufficient conditions for the outcome; the citizen supplies the rest.

This is an uncomfortable fact for organizations that were built, funded, and measured as if their job stopped at the point of service delivery. A management culture inherited from manufacturing or retail treats the citizen as a customer receiving a finished product. Public value theory treats the citizen as a second workforce, whose behavior, consent, and effort are inputs to the outcome, not just a verdict on it. Getting this wrong has a direct cost: programs are designed, funded, and evaluated around the organization's activity rather than around the joint activity that actually produces the result, and then those programs under-perform for reasons the organization never examines.

This topic is also where the book settles a question the previous four topics left open: whose judgment counts when deciding what is publicly valuable in the first place. The authorizing environment (see Topic 1.2 — The Strategic Triangle: Legitimacy, Value, and Capacity) is the source of legitimacy and support a public manager needs to pursue a value proposition. This topic asks who populates that environment beyond the formal chain of elected authority, and what it means for citizens to participate directly in deciding and producing value, rather than only consenting to it through a vote every few years.

Core concepts

A stakeholder is any individual or group who affects, or is affected by, an organization's pursuit of its objectives — a definition traced to a 1963 Stanford Research Institute memorandum and developed into a full management theory by the scholar R. Edward Freeman in the 1980s (see Stakeholder (corporate)). In public value terms, the stakeholder map for a single program is wide: service users, taxpayers who fund it whether or not they use it, elected officials who authorize it, delivery partners and contracted providers, frontline staff, regulators, and — for anything with a multi-year time horizon, such as pension policy or climate adaptation — future generations who have no vote and no voice today but will inherit the consequences.

Citizens occupy at least three distinct roles in this map, and confusing them is a recurring source of policy failure. As consumers, citizens receive a service and judge it on convenience, responsiveness, and quality, much as they would judge a private-sector transaction. As voters, citizens confer legitimacy on the institutions and office-holders who set policy, in a periodic and highly aggregated act of consent. As co-producers, citizens contribute effort, information, compliance, or behavior change that is a direct input to the outcome itself — attending a health check, separating recyclables, reporting a pothole, supervising a child's schoolwork, or simply obeying a regulation because it is understood to be legitimate. A single citizen typically holds all three roles simultaneously with respect to the same organization, and public managers who design only for the first two will under-perform on outcomes that depend on the third.

Co-production, the term this topic is home to, denotes the involvement of citizens and service users directly in the design and delivery of public services, rather than as passive recipients of a service designed and delivered entirely by professionals (see Co-production (public services)). The term originates in the work of the American political economist Elinor Ostrom (see Elinor Ostrom), who observed in the 1970s that Chicago's police effectiveness depended as much on citizens reporting crime and cooperating with investigations as on police activity itself, and who later generalized the finding: many public outcomes are jointly produced by a "regular producer" (the public organization) and a "consumer producer" (the citizen or community), and outcomes suffer when either party's contribution is designed away. Ostrom's wider legacy, developed in her book on the governance of shared resources (see Governing the Commons), extended this insight to commons governance: resources such as irrigation systems, fisheries, and forests — goods economists classify as common-pool resources because they are costly to exclude people from but rival in consumption (see Common-pool resource) — are often best sustained not by state control or privatization but by the users themselves, organized under rules they had a hand in setting. The line from commons governance to public service co-production is direct: both rest on the insight that the people who use a resource or a service are also a resource for producing it well.

Co-production takes different forms depending on who is involved. Individual co-production is one citizen contributing to their own outcome (managing a chronic condition, filing an accurate tax return). Group co-production is a set of citizens working with an organization on a shared local outcome (a neighborhood watch, a parent–teacher association). Collective co-production scales this to a whole community shaping a service system, typically through structured participation rather than informal effort.

Structured participation itself spans a spectrum, usefully organized by the American planner Sherry Arnstein's influential model of graduated levels of citizen involvement, running from manipulation and informing, through consultation, to partnership and citizen control (see Sherry Arnstein). Three mechanisms sit at the higher end of that spectrum and recur throughout this book. Deliberative democracy describes decision processes in which reasoned discussion among participants, not the simple aggregation of pre-formed preferences through voting, is the source of legitimacy (see Deliberative democracy). A citizens' assembly operationalizes this at scale: a body of people selected by lottery from the general population, broadly representative of it, given time, balanced evidence, and expert input to deliberate on a specific question and produce recommendations (see Citizens' assembly). Participatory budgeting gives residents a direct, binding say over how part of a public budget is spent, typically through neighborhood proposal meetings followed by a public vote (see Participatory budgeting). Co-design, more often cataloged under the broader heading of participatory design, involves citizens and service users as active partners in designing a service, not only as subjects consulted about a design produced by others (see Participatory design).

Finally, this topic treats the authorizing environment from a specific angle (see Topic 1.2 — The Strategic Triangle: Legitimacy, Value, and Capacity, which defines it formally as the set of actors — elected officials, oversight bodies, media, interest groups — whose backing a manager needs to pursue a value proposition). This topic adds that broad public consent is itself part of that environment, and that consent secured only through periodic elections is thinner and more fragile than consent renewed through ongoing participation. A program can be entirely lawful and still be starved of the public cooperation it needs to work.

Best practices

1. Map the full stakeholder set before designing the intervention, not after. Identify service users, non-user taxpayers, delivery partners, frontline staff, and any group affected by externalities, and note which of them the design currently treats only as an audience.
2. Separate the citizen-as-consumer question from the citizen-as-co-producer question in every service redesign. Ask both "is this convenient and responsive?" and "what does this design require the citizen to contribute, and have we made that contribution easy and clearly understood?"
3. Design the co-production task as carefully as the professional task. If an outcome depends on a citizen completing a form correctly, attending an appointment, or changing a behavior, treat that step with the same design discipline — user testing, plain language, minimal friction — applied to the professional side of the service.
4. Match the participation mechanism to the decision at stake. Use light-touch consultation for low-stakes, reversible choices; reserve citizens' assemblies and other deliberative formats for decisions that are high-stakes, values-laden, or too politically charged for ordinary representative debate to resolve well.
5. Publish what participation changed, not just that it happened. Close the loop by reporting, in plain terms, which recommendations from a citizens' panel, budgeting round, or consultation were adopted, adapted, or rejected, and why.
6. Resource co-production properly rather than treating it as free labor. Volunteer time, community expertise, and citizen effort have real costs to the people providing them; budget for training, expenses, and support rather than assuming participation is costless to the organization.
7. Recruit for representativeness, not just enthusiasm. Self-selected participation over-represents people with time, confidence, and prior trust in institutions; use stratified sampling or targeted outreach for anything intended to represent the wider public, following the practice developed for citizens' assemblies.
8. Give co-design partners real authority over some part of the decision. Participation that stops at consultation, with no binding effect, teaches participants that their input does not matter and depletes trust faster than not asking at all.
9. Treat future generations and non-present stakeholders as a standing item, not an afterthought. For any program with effects lasting beyond a single budget cycle, name who will bear the consequences and assign someone the job of representing that interest in the room.
10. Build a standing participation infrastructure rather than reinventing it for each initiative. A maintained panel of citizens, a recurring budgeting cycle, or a standard co-design method lowers the cost and raises the quality of the next exercise.
11. Distinguish legal compliance from earned consent when reporting on legitimacy. A program can clear every procedural requirement — public notice, comment period, sign-off — and still lack the broad public consent this topic is concerned with; track both separately.
12. Train staff to share authority, not just gather opinions. Co-production and co-design require professionals to treat citizen knowledge as a valid input to design decisions, a skill that formal training in service delivery rarely teaches on its own.

Questions to discuss with your team

Who are we treating only as an audience for this service, and what would change if we treated them as a co-producer instead? Walk through your major service lines and, for each one, ask whether success depends on citizen behavior, compliance, or effort that your current design simply assumes will happen. If it does, the citizen is already a co-producer of the outcome, whether or not your organization has designed for that role. Discuss what would change in staffing, communication, or service design if that dependency were made explicit and planned for, rather than left implicit and hoped for.

Where does our legitimacy currently rest only on having won an election or a contract, rather than on ongoing public consent? Elections and procurement processes are real sources of authority, but they renew infrequently and aggregate a lot of disagreement into one binary outcome. Identify one program where public support looks thin between electoral cycles, and discuss what a lighter, more frequent channel for gauging and renewing consent might look like for it. Consider what it would cost to run, and what it would cost not to.

Which of our public participation exercises have changed a decision, and which have only informed one that was already made? Participation that never changes an outcome trains the public to disengage, and word of that experience spreads faster than any invitation to the next consultation. Review your last two or three consultations or panels honestly and identify what, if anything, was different afterwards because of them. Discuss what would need to be true — in mandate, timing, or authority — for the next one to have real effect.

Whose voice is systematically missing from our participation processes, and why? Participation that relies on people volunteering their time tends to over-represent those with flexible schedules, confidence in institutions, and prior trust that engaging is worthwhile. Discuss which groups affected by your programs are least likely to show up unprompted, and what a deliberate, resourced effort to reach them — rather than a general open invitation — would look like. Weigh this against the wider equity question of who benefits from participation (see Topic 3.5 — Equity, Fairness, and Distributive Justice), since unequal participation can quietly reproduce unequal outcomes.

How would this decision look different if we used a deliberative mechanism instead of a standard consultation? Standard consultations gather opinions people already hold; deliberative mechanisms such as citizens' assemblies give participants time, balanced evidence, and each other's reasoning before they form a view. Pick one genuinely contested decision on your current agenda and discuss whether it is the kind of values-laden, high-stakes choice that would benefit from a deliberative format, or whether that would be disproportionate to the decision's actual weight. Be honest about whether the reluctance to try it is about cost, about time, or about a wish to keep control of the answer.

What would it cost us, in money and in trust, to under-invest in citizen co-production for one more year? Co-production failures rarely show up as a single dramatic event; they show up as slowly rising costs of enforcement, declining voluntary compliance, and services that technically function but do not achieve their outcomes. Discuss which of your current outcomes are most exposed to this slow failure mode, and what a modest, funded investment in co-production capability would look like as an alternative to discovering the cost later.

In practice: a public value example

A mid-sized regional water utility serving both urban and rural customers faced a familiar problem: a multi-year drought had made voluntary water conservation essential, but two previous public information campaigns — bill inserts, billboards, a short-lived rebate for low-flow fixtures — had produced only a marginal reduction in household use. Internally, the utility's leadership had begun to describe the shortfall as a "public awareness problem", implying that better messaging was the missing ingredient.

A newly appointed director of customer and community services challenged that framing. She pointed out that the utility's entire conservation strategy treated households purely as an audience to be informed, when the outcome it actually needed — sustained behavior change across tens of thousands of households — depended on households as co-producers of the result. She proposed reallocating a portion of the marketing budget to a different approach: a standing panel of one hundred residents, recruited to be broadly representative of the service area by age, income, household size, and urban/rural split, convened for a series of structured sessions with utility engineers and hydrologists rather than a one-off survey.

The panel's brief was narrow and concrete: recommend how the utility should allocate a fixed sum between three options — a stronger rebate for water-efficient appliances, a tiered pricing structure that raised the marginal cost of high usage, and a neighborhood-level co-design process for adapting outdoor irrigation norms to local conditions. Panel members received the same technical briefings the utility's own board received, including the trade-offs each option implied for equity, since tiered pricing risked penalizing large low-income households more than affluent ones with smaller families.

The panel's eventual recommendation combined all three at different scales: a modest universal rebate, a tiered structure with a protected low-usage band, and community-led irrigation working groups in the six highest-consuming neighborhoods, each supported but not run by utility staff. The utility's board adopted the recommendation largely as given and published, neighborhood by neighborhood, what had changed as a direct result of the panel's input. Eighteen months later, household consumption in the six pilot neighborhoods had fallen further and held longer than in comparable areas that received only the rebate and pricing changes. The utility's own staff described the shift less as a communications success and more as a recognition that conservation had never been something the utility alone could deliver; it was something the utility and its customers had to produce together, and the panel had simply made that partnership deliberate instead of assumed.

This scenario is illustrative and fictional; it does not describe any real utility's program.

Four sector lenses

Local government

Local government sits closest to the citizens whose co-production it depends on, which is both an advantage and a source of strain: proximity makes direct participation mechanisms such as participatory budgeting and neighborhood co-design genuinely feasible at a manageable scale, but it also means the same small pool of engaged residents is repeatedly asked to show up, while officials face the most direct, face-to-face accountability for whatever a participation exercise fails to deliver. The practical craft at this level is recruitment discipline — reaching residents who do not already attend council meetings — and follow-through, since a local authority cannot easily hide behind distance or scale when a promised consultation outcome does not materialize.

National government

National government participation mechanisms tend to be more formal, larger in scale, and further from the citizens they concern, which pushes toward representative deliberative formats — national citizens' assemblies on specific contested questions — rather than continuous local co-design. The central challenge is translating a broadly representative but necessarily small deliberative body's recommendations into legitimacy for a decision that will affect a population of millions who did not participate directly; this requires unusually careful, transparent recruitment and reporting, since the entire legitimacy claim of the exercise rests on the public believing the panel was genuinely representative and genuinely listened to.

Social sector and nonprofit

Nonprofit and social-sector organizations are often founded around a co-production relationship as their core operating model — mutual aid societies, self-help and recovery groups, and community organizations frequently exist precisely because the people affected by a problem are also central to solving it — which gives this sector a natural head start on the concepts in this topic (see Topic 3.8 — Social Sector and Nonprofit Management for the governance structures that support this). The distinctive risk is the opposite of government's: a funder or board can quietly professionalize a genuinely co-produced service into one delivered to beneficiaries, in the name of consistency or risk management, and lose the community ownership that made the model effective in the first place.

Multilateral and international

Multilateral and international bodies operate furthest from individual citizens and typically reach them, if at all, through national governments, civil society organizations, or local partners, which makes direct co-production mechanisms harder to run and easier to perform superficially. Development programs have a long, documented history of participation exercises that consult local communities without giving them real authority over design or resourcing decisions; the credible version of this work, associated with the participatory development literature that grew out of Ostrom's commons research, requires genuinely devolving some budget or design authority to local and community-level partners, not merely conducting a listening exercise before headquarters decides.

Common failure modes

Consultation theater. An organization runs a consultation, citizens' panel, or comment period after the substantive decision has effectively already been made, and no visible change follows regardless of what participants say. This costs more than the exercise itself: participants who conclude that their input was decorative become harder, not easier, to engage next time, and word of a hollow process travels through community networks faster than any invitation does.

Treating co-production as free labor. An organization redesigns a service to depend on volunteer time, unpaid caregiving, or citizen effort without budgeting for the training, coordination, and support that effort needs, effectively balancing its books by transferring cost onto households least able to absorb it. This produces short-term savings and a longer-term equity problem, since the households with the least slack time are the ones for whom the added burden lands hardest.

Confusing the loudest stakeholders with the representative ones. Open, unstructured invitations to participate systematically favor people with time, confidence, and prior institutional trust, producing a participation record that looks robust in volume but is skewed in composition. Decisions built on that input can entrench, rather than correct, existing inequities, because the people least well served by the status quo are often the least likely to show up unprompted.

Designing the professional task and ignoring the citizen task. Services are frequently redesigned with intense discipline on the organization's own processes — staff workflow, case management, data systems — while the step the design requires of the citizen (understanding a letter, completing a form, attending an appointment) receives no comparable design attention. Outcomes then suffer for reasons the organization's own performance data never surfaces, because the failure point sits outside what the organization measures.

Treating the authorizing environment as satisfied by legality alone. A program clears every formal requirement — statutory consultation, board sign-off, legal review — and its sponsors conclude its legitimacy question is closed, while broad public consent has in fact eroded or never formed. This gap tends to surface at the worst possible moment: as public resistance, non-compliance, or reversal once political conditions shift, rather than as an early warning the organization had a chance to act on.

Maturity model

Checklist

• Stakeholder map drawn for this program, including non-user taxpayers, delivery partners, and future generations where relevant.
• Citizen's role in producing the outcome (not just consuming the service) made explicit in the program design.
• Co-production task for citizens designed with the same rigor as the professional task (plain language, low friction, tested with real users).
• Participation mechanism chosen to match the decision's stakes, reversibility, and level of contestation.
• Recruitment method for any panel or deliberative exercise checked against population data for representativeness.
• Budget allocated for the real cost of citizen participation and co-production, not treated as free.
• Authority the participation exercise actually holds stated up front, in plain terms, to participants.
• Process in place to publish what changed, and what did not, as a result of the exercise.
• Equity implications of who participates and who does not reviewed (see Topic 3.5 — Equity, Fairness, and Distributive Justice).
• Legitimacy tracked separately from legal compliance, so a procedurally sound but publicly unsupported program is visible before it fails.
• Standing participation infrastructure considered as an alternative to a one-off exercise for recurring decisions.

Key sources

• Elinor Ostrom's work on co-production and commons governance, especially Governing the Commons (1990) and her 1996 article on coproduction and development, for the theoretical foundation of citizens as producers, not only consumers, of public outcomes.
• Tony Bovaird's 2007 Public Administration Review article on user and community coproduction, for a practical framework of coproduction roles across services.
• The Organisation for Economic Co-operation and Development (OECD)'s comparative work on deliberative democratic institutions, for empirical evidence on how citizens' assemblies and related mechanisms are designed and where they succeed or fail.
• The World Bank's cross-country review of participatory budgeting, for practical guidance on running binding citizen budget processes at scale.
• Sherry Arnstein's 1969 article on the ladder of citizen participation, for the foundational typology distinguishing genuine participation from consultation that changes nothing.

References

1. Stakeholder (corporate) — Wikipedia — https://en.wikipedia.org/wiki/Stakeholder_(corporate)
2. Co-production (public services) — Wikipedia — https://en.wikipedia.org/wiki/Co-production_(public_services)
3. Elinor Ostrom — Wikipedia — https://en.wikipedia.org/wiki/Elinor_Ostrom
4. Common-pool resource — Wikipedia — https://en.wikipedia.org/wiki/Common-pool_resource
5. Sherry Arnstein — Wikipedia — https://en.wikipedia.org/wiki/Sherry_Arnstein
6. Deliberative democracy — Wikipedia — https://en.wikipedia.org/wiki/Deliberative_democracy
7. Citizens' assembly — Wikipedia — https://en.wikipedia.org/wiki/Citizens%27_assembly
8. Participatory budgeting — Wikipedia — https://en.wikipedia.org/wiki/Participatory_budgeting
9. Participatory design — Wikipedia — https://en.wikipedia.org/wiki/Participatory_design
10. Ostrom, E. (1996). "Crossing the Great Divide: Coproduction, Synergy, and Development" — World Development, 24(6), 1073–1087 — https://www.sciencedirect.com/science/article/abs/pii/0305750X9600023X
11. Bovaird, T. (2007). "Beyond Engagement and Participation: User and Community Coproduction of Public Services" — Public Administration Review, 67(5), 846–860 — https://onlinelibrary.wiley.com/doi/abs/10.1111/j.1540-6210.2007.00773.x
12. Innovative Citizen Participation and New Democratic Institutions: Catching the Deliberative Wave — OECD — https://www.oecd.org/en/publications/innovative-citizen-participation-and-new-democratic-institutions_339306da-en.html
13. Participatory Budgeting (Public Sector Governance and Accountability Series), edited by Anwar Shah — World Bank — https://openknowledge.worldbank.org/handle/10986/6640
14. Ostrom, E. (1990). Governing the Commons: The Evolution of Institutions for Collective Action — Cambridge University Press.
15. Arnstein, S. R. (1969). "A Ladder of Citizen Participation" — Journal of the American Institute of Planners, 35(4), 216–224.