There was the £70bn spent on large scale IT-led change that resulted in administrative chaos and worsened service. Then there was the £320m on a "verification Framework" scrapped by the same Government. It's often the smaller examples that most exasperate us: the £400m spent on 'cost control' for the Olympic Games, and the £280,000 on a conference addressed by Blair and Brown last year on – of all things – value for money in public services.

The public sector has expanded by 800,000 since 1997, many engaged in the 'busy bee' fee functions of monitoring, assessing, targeting and evaluating but with precious little honey to show for all that buzzing. As Government finances have come under increasing pressure, we can't continue to spend taxpayers' money on services that don't deliver.

Yet in its organisation, its structure and its obsession with targets and 'delivery', is it setting itself up to fail? Management guru and author John Seddon certainly thinks so.

Seddon, of Vanguard Consulting, is a man with a messianic message. He believes Government has been investing in the wrong things. Belief in targets, incentives and inspection; belief in economies of scale and shared back office services: all the changes and promised improvements that have become the lingua franca of Government in recent years are, in his view, wrong-headed ideas. Yet they have underpinned the Government's attempts to reform the public sector.

"We invest in the wrong things, believing them to be the right things. We think inspection drives improvement, we believe in the notion of economies of scale, we think choice and quasi-markets are levers for improvement, we believe people can be motivated by incentives, we think leaders need visions, managers need targets and information technology is a driver of change. These are all wrong-headed ideas, but they have been the foundation of public sector 'reform'."

Seddon has expanded on his ideas in a new book out in the past month with the somewhat ungainly title: Systems Thinking In The Public Sector: The Failure Of The ReForm Regime And A Manifesto For A Better Way. It deserves to be a must read, both in the public sector and across private business. His radical ideas have been championed by Enterprise Minister Jim Mather. Barely a Mather public appearance or speech to a business audience in recent months has gone by without a recommendation by Mather for Seddon's work and his new book. In turn, Seddon has praised Mather and the SNP administration for getting out of the business of micro managing local authorities.

Seddon is coming to Scotland this week and is due to speak at East Renfrewshire Council tomorrow at noon, and Glasgow City Council at 3pm.

Few business people, and fewer still in the public sector, I believe, would not fail to identify with the critique Seddon offers. Plausible but wrong ideas, he says, have been promulgated by a massive specifications and inspection industry.

"There are now many thousands of people engaged in telling others what to do and inspecting them for compliance. Public services have requirements placed on them by a plethora of bodies, the biggest single weakness of which, common to them all, is that they are based on opinion rather than knowledge.

"The regime, ignorant of this essential shortcoming, legitimises the role of the many specifiers by giving them the power to demand compliance. This is dysfunctionality of a high order."

Seddon is scornful of the cult of 'deliverology' – the so-called science of delivery as invented by Sir Michael Barber, head of former Prime Minister Tony Blair's Delivery Unit – a real misnomer, he says, as it didn't deliver. Instead, it established a coercive regime to force others to comply. He is also unsparing in his attack on the way social care has been developed like a factory: call centres, electronic records, targets, specifications, reporting and outsourcing. "As a direct consequence of this factory system, care services carry high costs and provide a quality of service that can only be described as shameful. Care services cannot be improved without removing the regime's specifications, since star ratings and inspection systems fail to recognise the reality of the service from the user's point of view."

Clearly defining an operating programme for Seddon's alternative approach is not so clear cut. Much of it is counter-intuitive. At the core of his Systems Thinking concept is the Toyota system of continuous improvement. Service providers need to organise their delivery around end-purpose rather than organisation, and flow rather than system. It means constant adaptation and innovation and a workforce with the power and encouragement to take responsibility for managing and improving the flow.

One example he cites is the way the current system, by taking service away from local providers and grouping it into mass production factories, can not only break the link between service provider and citizen, but feed disappointment, frustration and complaints. Little wonder that to date Vanguard's work has shown that most public sector demand is failure demand, for example: "Why haven't you called yet?" and "It's been done wrong." The greatest leverage therefore is to reduce the 50–60% of demand that consumes most resource and money.

Listening to him expound his approach, one feels it sounds similar to that of Kaizen Blitz, the micro-management school of change by reinvention. Kaizen Blitz apostles have already been brought in by several local authorities in Scotland. But Seddon and Vanguard are not convinced.

Supporters of the method claim that it gives people an idea how much change can be created in a short period of time (a day or so), thus creating an appetite for continuous improvement through the whole organisation. But the problem, says Vanguard, is method. Not only does it fail to reach the right diagnosis about the nature of the problem but its method of fixing problems is also flawed. It may be seen to fix a micro problem while the greater dysfunction remains in situ. It is also accused of being an offshoot of the 'command and control' school of management.

Seddon's controversial critique brings together those within the public sector who are frustrated by the current system and denied the responsibility to bring change, and the wider world exasperated by the waste of public funds and the inability of the system to deliver better results despite huge injections of extra cash.

At present we suffer from a centrally managed system that denies responsibility and involvement for those in the front line acutely aware of where the system is going wrong and how it can be improved. Not for the first time, it's the people at the top who need to see the light.

• Systems Thinking In The Public Sector: The Failure Of The Reform Regime… And A Manifesto For A Better Way, Triarchy Press, £20.