Systemic Management Practices—Enabling Local Governments to Adapt in Response to Complexity

Abstract

Local governments are increasingly navigating accelerating change and escalating complexity caused by interconnected crises, commonly referred to as a global polycrisis. These crises, including climate change, lack of affordable housing, declining mental health, and geopolitical instability, both shape and are shaped by local conditions. Cities face growing pressure to equitably provide services that are responsive to evolving community needs while contending with the systemic nature of contemporary challenges. However, local governments are often constrained by conventional management frameworks and practices that do not match the complexity of today’s challenges. The purpose of this conceptual paper is to explore how systems science can be leveraged to define and characterize a transformative new type of management designed to enable local governments to more adequately address emerging complexity. To this end, the authors review the literature on contemporary management practice and explore how management for local government can be reframed in alignment with the insights from systems science, using a service ecosystem lens. The findings point to a needed shift toward systemic management practices that are integrative, collective, and adaptive. The authors illustrate the practical relevance of these three characteristics and conclude with recommendations for research, policy, and practice aimed at building the institutional capabilities required to transition toward systemic management frameworks and practices that match the complexity of the polycrisis.

1. Introduction

Local governments are increasingly confronted by accelerating change and escalating complexity impacting the well-being of the communities they serve [1,2]. Local communities worldwide face a wide range of challenges—including unaffordable housing, environmental catastrophes (e.g., fires, floods, heatwaves), employment, mental health and substance abuse crises, rising immigration, public health threats, digitalization, and growing economic insecurity. Consistently and equitably providing core municipal services, such as adequate housing, access to drinkable water, efficient transportation, sanitation, and economic development, that meet the diverse needs of residents is increasingly challenging under these conditions [3].

Adding to this complexity is that many local challenges are impacted by larger scale dynamics, such as energy, economic, environmental, health, and food systems [4]. Across all scales from local to global, systems are being impacted directly or indirectly by complex and intensifying issues such as climate change, biodiversity loss, global pandemics, supply chain disruptions, inflation, national isolationism, and political tensions. These global developments are not just simultaneous coincidental occurrences of independent crises, as in a “perfect storm”. Instead, many scholars suggest that governance must deal with a more complex and unmanageable situation: a global polycrisis [4,5]. One definition is of, “a single macro-crisis of interconnected, runaway failures of Earth’s vital natural and [society’s] social systems that irreversibly degrade humanity’s prospects” [5]. In response to the polycrisis, scientists pointed out how the demands of progress of our societies have become increasingly unsustainable—exceeding ecological ceilings while also failing to meet essential social foundations based on science and ethics [6,7,8,9].

As a result of these developments, local governments must stretch beyond the local scale and historical core service delivery focus, recognizing that they have a crucial role in responding to these interconnected challenges, especially given how variably they affect individual communities at a local scale [2,10]. Local governments present a significant leverage point for enacting and enabling widespread transformative change necessary for communities to flourish, especially in the context of the accelerating change and increasing complexity [2,11].

Firstly, local governments are well positioned to lead and facilitate transformative change, given their role as historical centers of innovation and the fact that they collect financial resources from and/or deliver services to most residents and organizations within a city [12,13]. For this paper, we use the term “city” to refer to the geo-politically bounded area and diversity of actors a local government serves. With a mandate to serve the public interest, local governments can drive systemic change by using their financial resources strategically and shaping policies that influence broad community behavior [2].

Secondly, the nature and intensity of the issues emerging vary significantly across the world, and to be effective, solutions must be tailored to the socio-cultural, ecological, and political local context unique to each city [2,14]. While higher levels of government also play a crucial role in enabling (or hindering) transformative change, it is local governments and their relationship to individual cities that position them to most effectively respond with context-specific solutions tailored to the city they serve [2,11,14].

Last, with the need to scale innovations out, up, and deep [15,16] for maximum impact, the local government sector embodies the potential to mobilize change rapidly. At baseline, and unlike private sector businesses that benefit by developing a competitive advantage, local governments increasingly share knowledge about their successes with others to be learned from and contextualized. In recent years, a global infrastructure has emerged to share case studies and scale best practices via regional, national, and international city networks (e.g., ICLEI—Local Governments for Sustainability and the Global Covenant of Mayors). These networks support local government officials and administrators in developing their capacities. Networks such as ICLEI—Local Governments for Sustainability have a global scope and have a significant role to play in supporting and showcasing governance innovation in rapidly urbanizing contexts in the Global South where local governments navigate complexity in deeply situated ways that could inform better approaches in Global North contexts. For these reasons, local governments represent a powerful leverage point for enabling systemic change within and beyond cities. This is increasingly substantiated both by research and international sustainability discourse emphasizing the growing importance of cities in multi-level governance frameworks—particularly in addressing transboundary and polycentric issues like climate change and sustainability [17,18,19]. Cities are central actors in achieving global objectives such as the UN Sustainable Development Goals (SDGs), with SDG11 (“Make cities and human settlements inclusive, safe, resilient and sustainable”) explicitly recognizing their role in broader transformation [20,21]. However, while cities hold this potential, their ability to act rapidly and effectively may be constrained by capacity gaps, political fragmentation, or a lack of institutional autonomy [22,23]. Peters and Pierre (2001) [24] argue that an over-reliance on local governance may result in uneven implementation or diminished coordination across scales. However, the increasing representation of cities in international negotiations and transnational networks reflects a normative shift toward the perspective of local governments as a key leverage point and enablers of change in the dynamic global policy landscape [25]. Advancing transformative change globally requires better integration of perspectives and practices from cities in the Global South. In these contexts, different historical trajectories, infrastructural constraints, and governance structures shape how complexity is experienced and managed. Scholarship has increasingly emphasized the urgent need for urban theory and policy approaches that are informed by these contexts rather than adapted from Global North models [26,27,28,29].

While local governments increasingly recognize the critical role they play, they are challenged by a mismatch between the emergent, dynamic, and unpredictable nature of the issues at hand and the dominant, relatively conventional management thinking and practices that have until now been a foundation for their operations and, therefore, contributed to the current crisis [11]. In general terms, there is a lack of institutional capability and capacity needed to support experimentation with new approaches to addressing the complex challenges cities face. This lack manifests in the form of restrictive key performance indicators (KPIs) that stifle public sector innovation rather than enable it. This, in turn, presents a challenge for initiating and scaling innovation led by the public sector [15]. To address these shortcomings, we propose a transition toward management systems of knowledge and practice appropriate to the level of complexity of the challenges to which local governments must respond. We argue that such management systems should be based on an understanding of cities as service ecosystems: nested in and interconnected with other systems, socially governed through institutional arrangements, and emergent [30,31]. This necessitates management knowledge and practice that is more integrative, collective, and adaptive compared to contemporary knowledge and practice.

In this conceptual paper, we first argue that the city itself is an example of a complex system that interacts with large-scale national and global challenges to exhibit increasingly complex system dynamics. As such, a systems perspective is useful for understanding how to leverage the necessary change at the local level in response to this increasing complexity and accelerating change. In applying the service ecosystem perspective, we identify three characteristics of a complex system, such as a city in the context of the polycrisis: integrative, collective, and adaptive. We then discuss how current management practices need to shift to match the complexity visible from this perspective in order to be effective. We do this by contrasting current management practices to what systemic management practices should look like, using the three system characteristics as the base for that comparison. For the purpose of this paper, we understand systemic management practices as those that apply systems thinking to understanding and managing organizations holistically as interconnected relational systems. We will conclude with specific recommendations for research, practice, and policy focused on supporting the transition toward systemic strategic management practices within cities. We believe that generating a common understanding of what systemic management practices need to look like is an important first step in identifying and guiding the changes that are needed to transition to systemic management systems, including the development of methods, tools, and approaches that will aid leaders in that transition.

2. Theoretical Foundation

2.1. Service Ecosystems Perspective for Managing Cities

The rapid acceptance in policymaking of the global polycrisis context [5] anchors our call for a new management mandate to come to grips with multi-problematic complexity. It may be sobering to recognize that the term was first offered by Edgar Morin in 1993 [32], as even then, systems scientists were observant of the risks of interconnected reinforcing crises that would only continue to expand, especially if we failed to observe and mitigate the causes and effects. Since then, approaches that are conceptually aligned with this lens have been applied at a global scale to understand how to achieve transformation within a complex context of dynamic and interlinked challenges, including informality, poverty, and governance constraints [33]. To understand how the increasing complexity caused by the polycrisis affects cities, as well as how to effectively respond, we find it necessary to adopt frameworks of systems thinking and science [11]. Systems science is a transdisciplinary field dedicated to studying the complexity of all types of systems including social, environmental, and economic. Systems science adapts theories, concepts, laws, and models that apply across multiple fields, allowing useful transfer and problem-solving from one context to another. While systems science has been called for in management since the 1970s, it may have finally found its adoption, as it is increasingly applied in various domains, including economic development [34], climate governance [35], urban planning [36], development and adaptation pathways [37], sustainability and resilience principles and practice [38], social change [39], and municipal planning and decision-making [11,35].

The service ecosystems (SESs) perspective represents an emerging area within systems science of relevance to public sector management because it addresses service provision in complex systems, referring to systems of actors who interact, often without direct coordination, to co-create value [30,31]. “Service” in service ecosystems is not limited to economic activities (e.g., the distribution of water by a municipality); it refers, more broadly, to the application of knowledge, skills, and resources by an actor for the benefit of another actor or for their own benefit [40]. Based on this distinction, relationships between actors become of central importance to the co-creation of value [41]. As such, the SES model is well suited for making sense of the city as a complex system. In the following sections, we will first discuss the viability of a city as a service ecosystem and subsequently outline three key characteristics of the city as an SES.

2.2. The Viability of a City as a Service Ecosystem

In the context of a city, actors within an SES include public, private, and third-sector organizations and residents who interact to optimize the use of common resources and address public interests [41]. The value generated within an SES can be understood as the increase in overall system viability [42] or ecosystem well-being [31]. To ensure the viability of the system, complex interactions between humans must be harmonized with each other, as well as with nature [11,43]. From this perspective, the viability of a city can be interpreted as “service ecosystem health”, or the “interdependent state of private, public, and planetary well-being necessary for sustaining life” [43], which is commonly referred to within a local government context as “sustainability”. In the context of this paper, we define ecosystem health in alignment with an established definition of sustainability, which posits that it can only be achieved by respecting the limits of earth’s ecological systems and meeting the social needs most critical to human well-being, that is, science- and ethics-based thresholds [7,8,9,44,45]. This contrasts with the more prevalent interpretation of sustainability, which emphasizes gradually reducing harm or increasing benefits without considering a science- or ethics-based threshold [46]. Taking a threshold-based approach is based on the understanding that the health of our earth’s ecological systems is dependent on keeping human social and economic systems functioning within a safe zone across a set of nine planetary boundaries [8,9,45] while exceeding specific ethically defined levels across various social indicators (e.g., housing, food, water, health, education, and social equity) [7]. These provide a high-level orientation for how to maintain service ecosystem health that can be localized to the regional and city levels.

Individual actors experience, co-create, and co-destroy value according to their situational context [47]. Therefore, actors often have a different understanding of the viability of an SES that is relative to their own needs, desires, and perspectives, and hence, what one actor considers value co-creation may be considered by another as value co-destruction [41,48]. Importantly, Fisk and Alkire (2021) [43] highlight that operationalizing service ecosystem health in practice hinges on three interconnected dimensions: interdependence, participation, and emergence, that mirror the characteristics of an SES articulated below. Building on Sangiorgi et al. (2017) [49], Fisk and Alkire (2021) [43] emphasize how local governments are uniquely positioned to implement service ecosystem health by aligning institutional structures and governance processes with these three dimensions. Our approach therefore aims to contribute to the operationalization of service ecosystem health by demonstrating how integrative, collective, and adaptive management practices can foster precisely the interdependence, inclusive participation, and emergent innovation necessary to advance ecosystem health in urban contexts.

2.3. Service Ecosystem Characteristics

Recently, Posselt et al. [11] provided a detailed examination of the service ecosystems perspective as a lens for complex systems change in cities to substantiate the need for management practices of local governments to evolve in response to increasing complexity. Building on this analysis, we briefly introduce the three key characteristics of a city as an SES: interconnected and nested, socially governed, and emergent. With these characteristics clearly identified and described, we are then able to distill the shortcomings of contemporary management practices and how they could evolve to become systemic. A summary of these characteristics can be found in

Table 1. Key characteristics of the city as a service ecosystem.

Interconnected and Nested

Is nested within wider systems and contains interconnected sub-systems. Is made up of interdependent actors who interact through complex relationships. Is therefore dependent on these other nested systems and interconnected actors to ensure its viability.

Socially Governed

Is governed by complex social structures that influence the behaviors and decisions of system actors. Is collectively shaped by all actors that enact, reinforce, and challenge these institutional arrangements. Is able to rearrange and adjust without external or centralized control. Is relatively inflexible in the way the social structures are organized and can be slow to respond when social structures need to be transformed.

Emergent

Exhibits emergent properties resulting from the interactions of all system actors. Behaves in a non-linear way, making it difficult to predict outcomes. Behaves in an even less predictable manner as the wider system conditions change.

below.

Interconnected and Nested. An SES consists of interconnected actors that interact with one another and their environment through various relationships and interdependencies such as family and other social connections, governance, business exchange, labor markets, service provision, etc. [40]. SESs are also nested within wider systems (for cities, these systems include landscapes, watersheds, habitats, bioregions, weather and climate systems, provincial and national governments, economic systems, broader cultural systems, etc.) and contain interconnected sub-systems (food systems, transportation systems, energy systems, etc.) [50]. The interconnected parts within an SES and the wider systems it is nested within share complex relationships that affect the overall health of the SES and its individual parts. This provides a challenge for the design of service ecosystems because the resulting multi-actor dynamics and interdependencies have to be actively attended to [51].

To adapt in response to increasing complexity and ensure its continued viability (or ecosystem health), a city will need to go through a significant transformation [11], that is, “radical, non-linear and structural change” [52]. While a city is geographically and geo-politically bounded and typically led by one local government with significant political jurisdiction within that boundary, nestedness implies that a city is also influenced by and influences wider social, environmental, and economic systems. This means that a city’s sustainability is interdependent with these other nested systems and interconnected actors; therefore, complex challenges cannot be effectively addressed without understanding these relationships between actors and across scales.

Socially Governed. SESs are also socially governed, meaning that they are shaped by enduring implicit and explicit social and cultural structures (institutions), such as rules, norms, beliefs, meanings, and symbols and the connections and interactions among them (institutional arrangements) [53,54]. These institutions and institutional arrangements influence the behaviors and decisions of actors, including how value is co-created and co-destroyed [55], and are continuously being reproduced collectively through the decisions, actions, and behaviors of all actors. Many of the most fundamental beliefs and assumptions held by the actors are largely implicit and unconscious drivers of activities in systems [53,54].

In cities, institutions and their implicit and explicit arrangements are central in fostering cooperative and coordinated behavior between actors and therefore enable cities as SESs to self-adjust without external and centralized control [40]. At the same time, institutions provide constraints on actions due to their implicitness and longevity, which can slow down cities’ responses to challenges that require transformative change. Scott (2013) [54] outlines three types of institutions: regulative institutions, which refer to formal rules, laws, and regulations (e.g., building codes and environmental regulations in a city); normative institutions, which encompass norms, values, and expectations (e.g., community norms of neighborliness or professional ethics in public service); and cultural–cognitive institutions, such as the shared beliefs, perceptions, and understandings that are taken for granted (e.g., attitudes towards sustainability or shared assumptions about the use of public spaces). Transformation in cities therefore necessitates change to institutional arrangements (e.g., the governance of a city). These are much more likely to succeed if all actors are involved in a conscious and reflective social process of shifting institutions at multiple levels [56]. Importantly, relationships and interactions among actors are shaped by power dynamics [53]. That is, certain actors typically hold more influence over institutional arrangements than others. Some actors also benefit more from existing institutional arrangements than others and thus have an interest in maintaining the status quo in the short term, even if that is a threat to the overall viability of the city and, ultimately, their own long-term well-being.

Emergent. Emergence speaks to high-level properties arising from an SES that cannot be predicted or explained purely by examining its components and that are capable of producing changes to an SES [50]. Given the complex interrelationships that connect actors within an SES, it will consequently exhibit emergent properties that are not indicative of nor predictable based on the characteristics and behaviors of its sub-systems or individual actors [57]. As external conditions change more significantly and rapidly, the behavior of actors and the implications of their interactions also become less predictable. Responses that have consistently generated the same outcome in the past may suddenly result in very different outcomes. This unpredictability makes it more difficult for individual actors to anticipate how others and the system as a whole will behave [51].

Because actors in SESs engage in complex interactions that are socially governed, value cannot be determined ex ante (e.g., the impact of actions a city takes to adapt in response to climate change), and thus, value is an emergent property that can only be understood within the specific circumstances of a place and point in time [40]. The emergent nature of an SES therefore points to the need for cities to flexibly respond to changing conditions and to constantly evaluate the usefulness of goals, policies, and devised actions.

The following section leverages the service ecosystems perspective for local government to outline shortcomings of contemporary management practices and to develop a set of research propositions that outline characteristics of more adequate, systemic management practices.

3. Strategic Management Practices in Cities as Service Ecosystems

3.1. The History and Nature of Contemporary Management Practices

Before examining how the strategic management practices of local governments might be adapted in response sufficiently to the increasing complexity, it is useful to first review the history that has shaped contemporary practice. For the past four decades, the governance and management practices commonly adopted among local governments have largely been shaped by the New Public Management paradigm (NPM) [58,59]. NPM emerged in the early 1990s in response to the perceived shortcomings of traditional public management practices at that time [60,61,62,63], following the many modernization programs of national governments. NPM developed from the movement to streamline public services by reconceiving the citizens as customers and grew to embrace a technocratic, neoliberal approach to managing public services. Over the past three decades, New Public Management (NPM) has evolved but remains rooted in its corporate management principles. It promotes efficiency through strategies such as customer orientation, performance metrics, market competition, decentralization, and managerial independence. NPM focuses on improving financial performance as well as the efficiency of product and service delivery, values that have since dominated public sector management [64]. As noted by Naresh Singh “Human wellbeing—what one might expect as the basic purpose of public service—did not seem to matter” [65].

The public management literature has been increasingly criticizing NPM practices, with calls for its displacement (e.g., [46,50,51]), including those coming from its very founders, such as Dunleavy’s (new) proposal to transition to digital governance, followed for 20 years in Canadian federal government [66]. Many other contenders for public management reform have emerged in recent years, but the style—if not the corporate model of NPM—has persisted, and a clear contender to replace NPM has yet to emerge. Public management reformists include Public Value Management, New Public Governance, post-NPM, and digital-era governance. Among the proposals for radical management innovation, we find network governance, system leadership, neo-Weberian governance, design thinking (managing as design), co-production, collaborative governance, Human Learning Systems, relational governance, Humble Government, and decolonial practices [15,63,65]. From our own studies of municipal strategic planning and management, we recognize the demand for change toward a new management system, constituted with systemic leadership methods to deal with increasing internal and external complexity. We suggest that the unique opportunity for transitional change is not to any one of these specific forms of management but rather that all the previous foundations are found wanting. All reforms offer a particular value system, but not one that has been universally adopted. The very multiplicity of proposals indicates an emerging paradigm shift, but the next paradigm has not yet evidenced itself in practice.

A growing community of sector experts (e.g., authorities, NGOs, and institutes) have recognized this reality and started exploring what innovation may be required to enable local governments to adapt (e.g., Centre for Public Impact) [65]. In a recent report, Baue (2023) [44] highlights that the current climate and sustainability actions remain mostly incremental because they are embedded within a neoliberal mindset of growth and are almost completely absent of science- and ethics-based thresholds for planetary boundaries and social foundations. The 2021 Innovate4Cities conference, co-hosted by the Global Covenant of Mayors and UN-Habitat, highlighted the urgency of accelerating local climate research, innovation, and action through global collaboration. The report published as an outcome of this research referred to an “implementation gap” that exists between the ambition expressed through climate action planning and target setting, and the actual progress being made, which remains largely incremental [67].

Figure 1 below illustrates the increasing mismatch between local government practices shaped by the NPM paradigm and the increasing complexity of a city as a service ecosystem within the context of the polycrisis. It also shows the emerging transformation toward a new management framework that is a more adequate match: systemic management. Within the remainder of this section, we will examine the shortcomings of contemporary public-sector strategic management practices in relation to the three key primary service ecosystem (SES) characteristics, as well as how they could evolve to match the increasing complexity local governments face and shift the focus of government from being a service provide to being an enabler of service ecosystem health. This needed transformation of practice is depicted in the bottom part of Figure 1.

3.2. Management Practices in Relation to Interconnectedness and Nestedness

3.2.1. Contemporary Management: Compartmentalized and Internally Focused Practices

NPM appears to not adequately account for the multi-level nature of service ecosystems. In SESs, we find that actions at one level of service or administration impact others in non-linear and interdependent ways. However, the market-based efficiency logic of NPM is too narrow and internally focused to address the systemic complexity of cities as urban ecosystems, which requires multi-actor coordination and cross-sectoral alignment [62,66,68]. As a result, policy and planning often become fragmented, with decision-making processes remaining siloed within departments and public services treated as discrete, transactional delivery processes rather than as part of an interwoven system of social, economic, and environmental interdependencies [58,59]. Many of the most complex and interrelated challenges emerging are commonly addressed independently by decentralized, isolated, and often poorly resourced departments or units (e.g., Climate, Sustainability and Equity, Diversity, and Inclusion (EDI) teams and/or offices) that have little cross-organizational influence [69]. While Guyadeen and colleagues [70] observed that 82% of the 66 strategic plans of Canadian local governments scored relatively high on coordination (i.e., how departments and organizations, both internal and external, can work with each other to implement the plan), they also noted that this coordination often resulted in making only the most obvious cross-departmental connections, such as sustainability and transportation and parks and community development.

The decentralization of decision-making is a strongly held objective within the NPM paradigm that has led to local governments typically operating in task- or functionally oriented, sectorial, and relatively disconnected divisions of management that employ siloed and compartmentalized approaches to managing complex issues [36,69,71]. As McPhearson et al. [36] concluded, “most urban visions (e.g., general plans, master plans, action plans, and even sustainability and resilience plans) do not assess synergies, trade-offs, and conflicts in a systematic way”.

Climate action planning under NPM, for example, often focuses on individual projects (e.g., renewable energy investments and emissions reductions) without considering interactions with transportation, housing, and economic policies [65,66] and track CO₂ reductions while ignoring social justice issues, such as energy poverty, housing, or public health [68]. Similarly, effective environmental governance requires awareness if not integration of regional, national, and global sustainability frameworks. The functional style of NPM tends to be self-reinforcing and not integrative. We observe a focus on each governing jurisdiction as managing its own accountabilities and avoiding the risks of dealing with the complexity of addressing ecological and external institutional systems [65]. As a result, municipal sustainability initiatives are rarely aligned with planetary boundaries and science-based thresholds, leading to fragmented, uncoordinated efforts [7,8,9,44,45]. This is exacerbated by short-term, efficiency-driven thinking, which, due to NPM’s focus on cost-cutting and financial performance, undermines long-term system viability. Local governments tend to largely pursue the organization’s viability and goals without meaningful consideration given to how they affect or are affected by interdependent systems they are nested within and the actors with whom they share relationships [65]. This leads to climate and sustainability actions which remain mostly incremental because they are embedded in a growth-driven neoliberal mindset that ignores systemic thresholds [44].

3.2.2. Systemic Management: Integrative Practices

The interconnected and nested structure of a city indicates a move away from compartmentalized and internally focused ways of operating toward more integrative management practices. This implies that leaders employ a systems lens, that is, consistently looking beyond the surface and searching for complex interconnections and multiple layers of influence and impact that are of greatest relevance. Cultivating a systemic perspective enables consideration of longer-term potential benefits and consequences of policies both cross-organizationally and externally. An integrative management style facilitates collaboration among leaders and staff from across departments with different perspectives, breaking through territorial and competitive thinking through trust-building and empowerment. A more collaborative and integrative approach will lead to more naturally recognizing interconnections between challenges and opportunities, including potential co-benefits and unintended consequences of any particular objective, decision, action, etc. Further, a more integrative and holistic approach would be considerate of how the viability of the organization depends upon and impacts the viability of wider systems and other actors. This includes Singh’s recognition that “outcomes such as improvement in human wellbeing are not produced by managers and their organizations but rather result from complex adaptive systems which are the communities in which people live” [65]. As such, the success of government plans and actions would ideally be similarly assessed and evaluated in an integrated manner to ensure overall ecosystem health and collective well-being. With a better understanding of the city as an SES, management processes and practices that are reflective of a systemic approach can be developed and implemented across the whole organization.

In line with this perspective, recent studies emphasize how interconnected ecological and economic factors are shaping outcomes for cities. For instance, Zou et al. (2024) [72] found that the coupling and coordination of ecosystem service value and economic development in China’s Pearl River Delta region illustrates the complexity of interactions between ecological and economic systems, highlighting their critical role in regional sustainability. Similarly, Zhang et al. (2022) [73] analyzed the spatial heterogeneity of urban land use expansion and PM 2.5 (fine particulate matter less than 2.5 μm in diameter) concentration in China, underscoring the importance of considering these issues at multiple scales. Together, these findings indicate that any effective urban governance must move beyond single-domain approaches and adopt an integrated systems perspective that addresses ecological, economic, and social dimensions simultaneously.

From the above insights, we derive the first proposition for systemic management practices:

P1: 

To address the challenge of increasing complexity, leaders in cities as service ecosystems need to embrace integrative management practices, meaning that they (1) consider how the viability of the organization depends on and impacts the wider systems and other actors; (1) pursue objectives cooperatively through flexible, transdisciplinary teams; (2) recognize interconnections between challenges and opportunities, including potential co-benefits and unintended consequences; (3) consider how the viability of the organization depends upon and impacts wider systems and other actors; and (4) assess plans and actions in an integrated manner to ensure overall ecosystem health and collective well-being.

3.3. Management Practices in Relation to Social Governance

3.3.1. Contemporary Management: Controlling and Insular Practices

Governance in service ecosystems is shaped by institutional arrangements—rules, norms, and shared values—that are co-created by and guide interactions among all actors in the system. However, NPM views governance as a market-like mechanism that prioritizes competition, decentralization, and financial performance rather than collaboration, institutional evolution, and participatory decision-making [58,59].

As a result, the control- and management-by-metric-orientation of the NPM has led local governments to respond to issues shaped by complex social structures by addressing the symptoms instead of institutional root causes, with more technical and relatively easily executable policies and actions that can be tracked and measured [74]. This orientation feeds into “the illusion of simplicity and control” that is central to NPM [65]. In line with this orientation, a drive for power and control is ingrained in the NPM style of management, stemming from the assumption that people are fundamentally selfish and need to be controlled, alongside a strong emphasis on efficiency as the primary outcome [65,75]. Consequently, local governments continue to employ relatively insular and controlling engagement practices that are not considerate of the interdependence between actors and the need to act cooperatively to enable the transformation of social institutions, which impedes the ability to adequately respond to and plan for complex challenges. Control is further emphasized by local governments’ focus on what falls within their jurisdiction and what can be accomplished using their own internal capacity and resources [76].

NPM perceives citizens as customers rather than active participants in public affairs, treating them with predefined and risk-averse engagement and thus limiting their ability to shape policies that affect their well-being [60,61,62,63]. This citizens-as-a-consumer orientation has often resulted in unilateral approaches that view citizens as passive service users, undermining the valuable role citizens can play in contributing to planning and decisions [77]. Several scholars have pointed to the lack of participation in support of decision-making meaningful to participating actors and representatives of a city’s diversity [70,78,79]. Contemporary engagement methods are often implemented in well-circumscribed ways that do not provide opportunities for actors to engage in in-depth dialogue, integrate knowledge from across boundaries [80], or sustain their involvement in addressing key issues [81,82]. Rather, engagement practices shaped by the NPM commonly focus on symbolic approaches and box-ticking exercises, the results of which are not meaningfully integrated into the ultimate decision(s) to be made [62]. For example, public service reforms under NPM prioritize customer satisfaction surveys over deliberative citizen engagement in policymaking [64].

Within an NPM-shaped framework of management practice, local governments are known to be relatively risk-averse when engaging with the public, leading to organizational impression management, that is, a strong and undue focus on reputation and risk management [83]. This is channeled into an overemphasis on metrics and accountability, by which NPM governance structures focus on performance measurement, efficiency metrics, and accountability through financial indicators, overlooking social well-being and democratic participation [65]. As a result, historically marginalized community members, in particular, experience the consequence of planning practices that commonly result in privileging the perspectives and objectives of the powerful [84,85], and actors other than residents (e.g., institutions, non-profits, businesses, other local governments, higher-level governments, etc.) are engaged to a much lesser degree [10]. This fundamentally undermines the ability of the city as a service ecosystem to effectively self-organize through the collective act of reflecting upon and then reforming, the institutional arrangements which govern the system.

3.3.2. Systemic Management: Collective Practices

In light of the polycrisis and seeing the city as a service ecosystem, the importance of shifting toward the development and utilization of collective management practices supported by deeply collaborative relationships with relevant actors within and across systems becomes apparent [11,56,65]. An effective collective orientation necessitates sharing power and enabling and empowering a diversity of actors to play a bigger role in designing and building the future. Rather than focusing on the symptoms of complex challenges and overly simple solutions, together, actors can engage in reflexivity to identify the socially based root causes of complex challenges that, left unaddressed, would significantly limit the outcomes that can be achieved. This may require meaningfully addressing historical injustices, such as colonization, racism, and ableism, that have led to disempowerment and disengagement of marginalized groups and a deep mistrust of government [78,79].

Such a fundamental shift in how actors are engaged would necessitate the role of local government to evolve from largely focusing on the delivery of mandated services toward committedly convening and facilitating the pursuit of a city’s sustainability and well-being with a diverse constellation of actors within and beyond the city they serve (i.e., ecosystem health) [11]. More collectively oriented practices would foster collaborative problem-solving, broader involvement, and community knowledge and experience through co-design and co-learning [56,86]. Participation that is sustained, inclusive, and empowering can enhance the quality of decisions made and increase the capacity of actors to understand and take ownership of complex, systemic challenges [65]. It promotes transparency and accountability in governance and leads to more effective monitoring of progress and impact. Ultimately, participation ensures the policies and interventions developed by local governments are informed by local needs and priorities, in what Heinonen described as “Humble Government” [65].

A good example of this collective approach is Polanyi and Ostrom and Ostrom’s concepts of polycentric governance [87,88,89], which has been integrated into ProSocial World’s approaches (see https://www.prosocial.world, accessed on 1 July 2024) and can be usefully applied to the interconnected and nested structures of a city ecosystem and its many diverse agents, influences and impacting factors [90]. Polycentric governance lends itself to the development of nested semi-autonomous groupings around ethnic communities, equity-deserving groups, lobby groups, industry players, activist groups, etc., in granting them participation in governance matters. Polycentric governance groups enjoy a degree of autonomy in terms of decision-making but also compete and cooperate within a common overarching system of agreed-upon rules, constitutions, political values, and cultural adaptability [91,92]. Despite some practical limitations [93], polycentric groupings are dynamic and responsive to changing circumstances and, in this context, provide grass-roots responses to factors impacting an ecosystem. Evolutionary competition between the different decision centers helps foster a healthy and dynamic interplay of ideas and solutions that remain highly responsive to changing environmental, social, and political circumstances and simultaneously proactive in anticipating emerging threats or changes.

Based on the above, the second proposition can be formulated as follows:

P2: 

To address the challenge of increasing complexity, leaders in cities as service ecosystems need to adopt integrative and collective management practices, meaning that they (1) engage in reflexivity to identify the socially based root causes of complex challenges that might impede transformative action; (2) pursue sustainability by convening and facilitating with a diverse constellation of actors within and beyond the city they serve; and (3) leverage collaborative and co-creative ways of working with internal and external actors.

3.4. Management Practices in Relation to Emergence

3.4.1. Contemporary Management: Linear and Reactive Practices

Service ecosystems evolve through emergent processes, where new governance models, institutional arrangements, and innovations arise unpredictably from interactions between actors. NPM, with its rigid structures and pre-defined objectives, is not designed for emergence, which has established an implementation gap between policy ambitions and real-world progress [68]. Through rigid planning and implementation models, NPM follows a linear, technocratic approach to planning, assuming that pre-set goals and performance metrics can effectively guide progress [63]. In alignment with the NPM paradigm, planning among local governments tends to be focused on linearly devised strategic actions based mainly on historical data and past experience rather than on more desirable possible futures [94]. Emphasis is placed on specific strategic actions to be accomplished within the legislative time period of elected officials (typically 4–5 years). Further, powerful unit managers are tasked with accomplishing the actions assigned to their area of responsibility [74]. As a focus on control is central to the NPM paradigm, local governments tend to continuously monitor performance relative to targets with a heavy reliance on measurable outputs and outcomes [65].

Another current misfit of contemporary practice is that responses to crises and challenges are often reactively developed rather than proactively anticipated and conceived [94]. However, as Tõnurist and Hanson (2020) pointed out, waiting until a crisis has emerged “to start imagining a way out of it can be far more costly (in social, environmental and financial terms) than anticipating and preparing for the crisis before it occurs” [94]. Some NPM planning regimes have moved to anticipating grim futures, but this is insufficient given the cascading interacting effects of the polycrisis, and many interdependent and interacting actors drive quickly emerging altering conditions that are often unpredictable. As such, planned actions, no matter how recently defined, can quickly become unfit or even counter-indicative. Policymaking amid uncertainty is like gardening because it is “muddy, attentive and experiential, because we really do not know what growing conditions will prevail” [95]. This approach is technically defined as incrementalism, or “muddling through”, a time-tested systemic strategy of managing uncertainty [96].

3.4.2. Systemic Management: Adaptive Practices

Understanding cities as service ecosystems highlights the pathway for shifting toward more proactive and adaptive management practices as a response to quickly emerging and often unpredictable changes. As Inayatullah [97] aptly noted, “the world is a complex adaptive system—once we map the [possible] future [s]—it changes. Thus, while we need a vision [based on what is believed to be desirable], we do not need a blueprint”. This implies that there needs to be new ways for local governments to recognize early signals and to be responsive [94]. Further, room is needed for experimentation as well as flexible planning and decision-making processes. This flexibility requires an organizational culture that promotes reflective practice and accepts failure and proactive learning from the results of past choices as a necessary and welcome part of innovation and experiential learning [94,98]. For cities to adapt to rapidly changing conditions, traditional top-down and siloed management practices may need to give way to community-based solutions developed through proactive, collaborative engagement with diverse local actors [99].

We derive our third research proposition:

P3: 

To address the challenge of increasing complexity and unpredictability, leaders in cities as service ecosystems need to adopt proactive and adaptive management practices, meaning that they (1) develop responsive strategies by anticipating change and identifying early signals and related implications; (2) leverage flexible planning and decision-making processes; and (3) embrace experimentation and failure to enable rapid, experiential learning and innovation.

Given the growing gap between emerging conditions and current practices, cities must develop integrative, collective, and adaptive management systems and practices to effectively respond to the polycrisis.

Table 2. Summary of contemporary and systemic management practices as contrasted against the characteristics of an SES.

Characteristics of A City as a Service Ecosystem	Contemporary Management Practices	Systemic Management Practices
Interconnected and Nested Nested within wider systems and contains interconnected sub-systems Made up of interdependent actors who interact through complex relationships Dependent on these other nested systems and interconnected actors to ensure their viability	Compartmentalized and internally focused Pursue objectives separately within task- or functionally oriented departments and teams Address complex, interconnected issues and challenges independently of each other Pursue the organization’s viability and goals largely without consideration given to how the interdependent systems and actors affect or are affected by them	Integrative Pursue objectives cooperatively through flexible, transdisciplinary teams Recognize interconnections between challenges and opportunities, including potential co-benefits and consequences Consider how the viability of the organization depends upon and impacts wider systems and other actors Assess plans and actions in an integrated manner to ensure overall ecosystem health and collective well-being
Socially Governed Governed by complex social structures that influence the behaviors and decisions of system actors Collectively shaped by all actors who enact, reinforce, and challenge institutional arrangements Able to rearrange and adjust without external or centralized control Relatively inflexible in the way the social structures are organized and can be slow to respond when social structures need to be transformed	Controlling and Insular Respond to issues by addressing symptoms with more technical and easily executable policies and actions Focus on what is within their jurisdiction and can be accomplished with internal capacity and resources Superficially involve actors to meet mandated requirements through predefined and risk-averse engagement Overemphasize efficiency and financial indicators	Collective Engage reflexively to identify the socially based root causes of complex challenges that might impede transformative action Pursue sustainability by convening and facilitating with a diverse set of actors within and beyond the city they serve Leverage collaborative and co-creative ways of working with internal and external actors
Emergent Exhibits emergent properties resulting from the interactions of all system actors Behaves in a non-linear manner, making it difficult to predict outcomes Becomes even less predictable as wider system conditions change	Linear and Reactive More responsive to change once impacts are felt or clearly observed Focus on measurable outputs and outcomes achievable within the legislative time period of elected officials Adopt strategic actions based mainly on historical data and past experience	Adaptive Develop responsive strategies by anticipating change and identifying early signals and related implications Leverage flexible planning and decision-making processes Embrace experimentation and failure to enable rapid, experiential learning and innovation

summarizes key areas of how local government management practices can evolve and outlines objectives for developing a new class of systemic approaches by contrasting contemporary and systemic management practices against the characteristics of an SES. This shift from contemporary to systemic practices is also illustrated in the bottom part of Figure 1.

3.5. Illustrative Example: Maintaining Sustainable Freshwater Consumption

To further explore the applicability of SES theory to cities and the need for more integrative, collective, and adaptive practices, we will examine an objective common to almost any city, namely, ensuring sustainable freshwater consumption. The following illustrative example has been successfully employed dozens of times by several authors of this paper to enable senior municipal leaders to appreciate the inadequacy of contemporary management practices and how systemic practices can dramatically improve the organization’s ability to navigate real-world complexity. In one instance, a multi-year engagement was facilitated, focused on building systemic performance management practices, which transformed the organization’s understanding of how to sustainably manage water consumption, among many other ecological resources and social needs.

The availability of freshwater to a city is generally a function of the watershed(s) it inhabits and/or to which it has access. A watershed is an area of land that catches precipitation and allows it to drain into streams, rivers, lakes or seep into the ground as groundwater. Unlike the geo-political boundaries of cities, watershed boundaries are defined by the hydrological properties of the landscape. The renewable supply of freshwater can be understood as the yearly precipitation entering a watershed, minus natural losses such as evapotranspiration and water required for ecosystem functions [100]. Over any period of time, the sustainability of freshwater consumed can therefore be calculated by comparing the total water drawn from the watershed against the level of precipitation that has fallen, less the volume of water naturally lost. Further, the sustainability of the city’s as well as an individual actor’s water consumption can be determined by assessing whether or not they have used more or less than their fair and just share relative to all other actors (other cities, villages, and individual actors) who rely on the same watershed.

Today, like most organizations, local governments typically address the sustainability of water consumption without consideration given to a science-based threshold or calculation of the renewable supply of water locally available. Performance is commonly measured by comparing consumption in the current year against past years, other local governments, or a sector benchmark/standard. These “incremental” measures may provide insight into how consumption is changing over time but say nothing about whether or not the level of consumption is sustainable and by how much of a margin. Without calculating how sustainable or unsustainable the level of consumption is, a local government cannot objectively determine whether or not reducing consumption is necessary or the degree to which it should be strategically prioritized.

With the nested and interconnected nature of a city as a service ecosystem in mind, local governments concerned with ensuring freshwater consumption is sustainable must recognize this outcome is a function of the choices of all actors that depend on the watershed to fulfill their needs. If a local government were to limit its consumption to a sustainable level while other actors continue to overconsume, the local government would remain at the mercy of a decreasing renewable supply of freshwater. An integrative approach would promote the collection of data, analysis, planning, and decision-making that is considerate of and a match for the complexity of this reality. The critical need for integrative practices is further emphasized by the relationship between freshwater availability and a breadth of other sustainability priorities local governments hold high, like equity, biodiversity, industry, and agriculture.

Given that a city is socially governed, ensuring freshwater consumption is sustainable cannot be enforced or achieved by a single or small group of actors. Addressing an unsustainable level of freshwater consumption requires system-wide change and naturally, local governments have an important role to play. Collectively oriented practices result in a shift in focus from what local governments have control over and can directly affect toward meaningfully involving all actors by facilitating dialogue, establishing participatory governance over relationships, sharing power, and stewarding collectively oriented progress over a longer time horizon. Local government intervening in this manner is critical to enabling a collective shift in perspective and agreement on both a common goal and how each actor must equitably contribute to its achievement.

The emergent nature of a city significantly contributes to the complexity of ensuring freshwater consumption is sustainable. Local government must recognize conditions within its watershed(s) will continue to change at an accelerating rate as the polycrisis continues to unfold. With stable levels of precipitation, incrementally reducing water consumption over time would result in approaching the achievement of a sustainable level of freshwater consumption. A drought induced by climate change, however, would require the collective to recognize the capacity of the watershed has declined for some period of time. This decrease in supply necessitates that agreement is formed around a new and lesser consumption goal, further intensifying the sacrifice collectively required. The fitness of any commitment, target, action, or policy depends on the context, which in turn is impacted by increasingly unpredictable conditions that require local governments to be proactive and adaptive. Proactive and adaptive practices would enable a local government to more quickly identify such changes and encourage swift collaborative responses by initiating the process towards a lower and lesser shared consumption goal. Such practices would also support recognizing the need for a shift in approach, governance, etc., given that this scenario may impact some actors more significantly (e.g., a small farmer already dealing with economic challenges).

4. Discussion

In this paper, we explored the impact of accelerating change and increasingly complex global and local challenges on the city as a complex socio-ecological service ecosystem and its ability to ensure sustainability or ecosystem health. We also discussed the inadequacy of the current strategic management practices of local government and how these practices need to evolve to be more integrative, collective, and adaptative. For instance, our analysis shows that contemporary, NPM-based management practices in local governments do not reflect the complex interrelationships in the city as a service ecosystem, as well as with other systems and the institutional arrangements that govern the behavior of actors within such systems. This is in line with the findings of Vink et al. (2021) [51], who emphasized that current service ecosystem design often addresses parts of the system in isolation, thus changing it in a linear and incremental manner rather than addressing the complexity of the system as a whole and the consequent need for transformative change. Similar limitations are also visible in the literature on Global South urban contexts where planning processes remain fragmented and fail to adopt systemic approaches to interconnected socio-economic, climate, infrastructure, and governance challenges—especially those faced by vulnerable populations [101].

In the spirit of Kurt Levin’s notion that nothing is as practical as a good theory, a key goal of this paper was to apply theoretical insights to a major current challenge in order to derive three postulates that have specific implications for practice and policy. Enabling the changes discussed above in practice has specific implications for transforming the role and function of local governments. For one, they would need to become enablers of the system as a whole by facilitating better performance of other actors within the city as an SES. They would need to decentralize power and constantly co-create with residents, organizations, and external actors (e.g., provincial governments). Further, they would need to engage in reflective practice and experiential learning and enable innovation and experimentation. This requires an open mind, an appreciation of taking risks, and a level of humility. To enable this transformation, there are several implications for research, practice, and policy.

Before we share specific implications, we will briefly examine a set of three conditions that we understand from our research and practice are critical to success: (1) securing senior-level management commitment, (2) adapting change across management functions, and (3) developing new and enhanced capabilities. We emphasize these three factors, in particular, based on both the theoretical considerations presented by Posselt et al. (2022) [11] and our practical experience facilitating the adoption of systemic management practices with leaders of two local governments in Canada.

Transitioning local governments toward systemic management practices is a complex and resource-intensive undertaking that involves significant change and, in some cases, fundamentally transforming structures, processes, roles, and responsibilities, etc. across departments and levels of the organization. As such, leading a successful transition toward systemic, strategic management practices requires the full commitment of leadership, who themselves will need support. That is, the leaders need to be personally motivated and deeply committed to investing the necessary resources and enduring the challenges involved. As Posselt et al. (2022) [11] pointed out, coming to such a conclusion is unlikely to happen unless leaders of local governments experience a transformative shift in mindset and, in particular, come to appreciate the inadequacy of contemporary management practices for the evolving complexity, as well as the risk associated with maintaining the status quo.

The level of leadership commitment is also critical because it will influence the breadth of management practices that are adopted. Management can itself be seen as an organizational system within which various functions are interdependent. Consider, for example, a local government that adapts towards more systemic planning practices but continues to manage performance in a more conventional manner focused on financial control and optimizing service delivery: The assessment of performance generated informs planning and as such would constrain the benefit of the adapted planning practices.

Even with leadership support in place as well as a commitment to adapting practices across functional areas, realizing the potential of a transitioning toward systemic management practices ultimately hinges on the development of new and stronger individual and organizational capabilities [11]. During the transformation, developing new, systemically oriented practices will demand more of leaders than the operation of historic contemporary practices. For example, a local government that understands its city as an SES and wants to effectively engage multiple external stakeholders to co-design a shared solution would move away from top-down problem–solution thinking towards approaches such as Appreciative Inquiry [102] or polycentric governance [88,89] that include as fundamental parts of its process the facilitation of group dialogues and surfacing assumptions through reflexivity. In contrast to contemporary practices, effectively leveraging a systemic approach of this nature will require new and stronger capabilities. Realizing the potential benefit of systemic management practices requires more than simply recognizing the opportunity and being committed to the necessary change. A critical aspect of building this capacity among leaders and their teams is the availability and adequate application of systemic management tools, methods, and approaches that are aligned with and can enable systemic management practices. The need to clearly identify, develop, and test these types of systemic management innovation has critical research implications as we argue below.

While the SES perspective is useful for developing the key characteristics of systemic management practices because it provides a framework for understanding the complex, multi-actor dynamics of cities, it is worth noting that it also comes with some limitations. Specifically, the SES perspective might obscure power asymmetries, institutional inertia, or entrenched political dynamics that shape governance [103]. It focuses on relational value co-creation and systemic viability but does not always offer concrete tools to navigate the uncertainty and institutional conflict associated with these goals. Therefore, complementary frameworks, such as resilience theory and network governance theory can help to address these gaps. Specifically, resilience theory adds insights regarding the processes through which cities absorb shocks, adapt to change, and transform in response to crises—with an emphasis on adaptive capacity, feedback loops, and thresholds [104]. Network governance theory offers a closer lens for analyzing the effect of inter-organizational relationships, trust, and structures on decision-making and policy implementation processes [105]. Integrating perspectives of these frameworks can assist in establishing a holistic perspective on transformation by complementing an SES’s focus on managing complexity, fostering innovation, and improving governance under uncertainty.

Based on the insights generated in this paper, we propose the following implications for research, practice, and policy:

1. 

Research Implications

For the potential of integrative, collective, and adaptative strategic management practices to be realized, city leaders need access to practical solutions. Since the 1960′s, many systemically designed concepts, frameworks and models have emerged that highlight the need to transform strategic management (e.g., the Viable Systems Model, Beer, 1989 [106]; the Learning Organization, Argyris and Schön, 1978 [107]; The Fifth Discipline, Senge, 1990 [108]). These systemic concepts, frameworks, and models are, from the perspective of contemporary management practice, significant innovations that recognize organizations are service ecosystems; that is, organizations are nested within complex and larger social and ecological ecosystems. While these innovations have widely influenced the perspectives of organizational leaders and are still respected today, their lack of practical applicability has limited the degree to which they have enabled the adaptation of systemic management practices. Even leaders who recognize the importance of adapting in response to conditions emerging need access to evidence-based solutions that are designed to address the complexity involved in redesigning practices and effectively implementing change [2,11]. Informed by these earlier innovations, in recent years, a growing number of systemic management methods and tools have emerged. These “systemic management innovations” provide leaders with the level of guidance they need to effectively apply the innovation to transform practices within their unique context (e.g., the Flourishing Business Canvas [109], the Three Horizons Model [110], Context-Based Sustainability [100]). Enabling more leaders to access practical systemic management innovations will require investments in developing the empirical base for them and further their development as well as efforts to mobilize the related knowledge in accessible ways. Thus, we propose the following as avenues for future research:

1.1.

Explore and define a new category of systemically designed and practically applicable management innovations that develop the recognizability of and lend credibility to this emerging field of critically needed solutions;

1.2.

Systemically test and refine integrative, collective, and adaptative strategic management practices, supported by applicable systemic management innovations, through co-productive applied research with innovation experts and local government actors;

1.3.

Develop empirical case studies of local governments applying integrative, collective, and adaptative systemic management practices;

1.4.

Conduct comparative case studies that assess the results generated by local governments that adopt integrative, collective, and adaptative systemic management practices and those that do not;

1.5.

Develop a knowledge repository of integrative, collective, and adaptative systemic management practices and applied case studies and knowledge and policy briefs;

1.6.

Develop and make accessible empirically validated programs that support local leaders in adopting integrative, collective, and adaptative strategic management practices.

2. 

Practice Implications

Evolving the governance structures and strategic management practices of local governments hinges on the leaders within. We propose several practical recommendations focused on enabling leaders to facilitate a transition toward more systemic—integrative, collective, and adaptative—management practices and the development of new capabilities:

Transformation Design and Governance:

2.1.

Be patient and prepared to facilitate a long transition. Making progress will necessitate aligning interests, securing cross-organizational support and resources, facilitating experiential learning, etc., and will need to be methodically coordinated over years.

2.2.

Evolve practices through experimentation, rapid learning, and iterative design. Create opportunities for safely testing innovative practices through constrained pilots that limit the negative impact of failures and ensure a higher likelihood of success when eventually implemented at scale.

Planning:

2.3.

Building the capacity to plan in an integrated and authentic manner that establishes a clear and substantive connection between the elements of vision, purpose, strategy, and operations.

2.4.

Develop adaptive, strategic foresight-informed approaches to planning in the context of accelerating change and increasing complexity.

2.5.

Ensure plans are flexibly designed and governed in a manner that is responsive to changing conditions, shifts in societal needs, and emergent opportunities. This may include adaptive budgeting, agile decision-making mechanisms, and modular (but integrated) urban policies.

Performance Management:

2.6.

Develop the means to ensure the shortcomings and unintended consequences associated with the existing system of management are visible and appropriately valued.

2.7.

Recognize that pursuing economic, social, and environmental thresholds at a community or wider scale can only be achieved through collective action and through more deliberative and trust-building measures such as transparent decision-making processes and participatory planning and budgeting.

Relationships and Engagement:

2.8.

Design, resource, and implement cross-departmental teams. Train staff in cross-sectorial and interdisciplinary approaches, including facilitation, conflict resolution, and co-creative methodologies to strengthen both internal and external collaboration.

2.9.

Prioritize building cooperative, trust-based relationships with all actors. Institutionalize deliberative practices that ensure opportunities are consistently available for common and non-traditional actors to meaningfully engage in planning and decision-making.

3. 

Policy Implications

Many current policies and mandates present significant challenges in evolving local government management practices toward sustainability and in effectively responding to increasing complexity. In addition, national and provincial policymakers should also reduce barriers and create policy frameworks that incentivize local leaders and enable them to take the necessary steps in the evolution of their practices. While the approaches proposed in this paper offer insights for local governments to respond to complexity, their applicability will vary across regional and national contexts according to factors such as administrative and political structures, fiscal autonomy, level of decentralization, and socio-cultural norms [111,112]. For example, cities with highly centralized regimes may face increased institutional and legal constraints that limit experimentation and stakeholder engagement [113]. In low- and middle-income contexts, resource limitations may hinder the development of systemic approaches [114]. The primary examples used in this paper are rooted in Global North cities. The transition toward systemic management must be tailored to the realities of Global South cities as the future centers of urbanization where informality, infrastructure, and capacity inform differentiated governance models and approaches [14,115]. Recognizing these constraints, the policy recommendations provided below are a flexible framework rather than a blueprint to be followed. They should be applied through a localization process that adapts them to specific governance structures, capacities, and needs to ensure their effectiveness. This process of tailoring systemic management innovations to governance ecosystems and capacity levels should be prioritized in future research.

We identified the following specific needs:

3.1.

New policies need to be considerate of the fact that we are in a polycrisis of interconnected challenges that cannot be successfully managed in an isolated manner.

3.2.

Local government needs to be given the resources to be capacitated to meaningfully engage in the needed transition towards integrative, collective, and adaptative strategic management practices. This includes building capacity for systems thinking and providing management tools, methods, and approaches that align with systems thinking.

3.3.

Funding mandates need to be adjusted to move beyond siloed and compartmentalized focus areas (e.g., just greenhouse gas reduction without considerations of equity) and become more flexible to account for quickly changing conditions and ongoing learning and development.

3.4.

Funding provisions should be contingent on ensuring the organizational capacities to implement changes in a systemic way are simultaneously being developed.

3.5.

Local policies and regulations need to become more flexible to allow for experimentation and acceptance of failures and avoid risk aversion and organizational impression management.