Voter support for investment in public services is at risk if performance does not improve, Tony Blair has said.
Mr Blair says the vast bulk of public servants do a good job
Change is "not about attacking public services, but saving and inspiring them", Mr Blair told a conference.
In a message likely to anger some trade unions, Mr Blair argued public services have much in common with business, despite their different ethos.
He is locking horns with Tory leader David Cameron, who warned ministers not to "scapegoat" civil servants.
Mr Cameron used a speech to admit that his own party has often appeared to be too hostile to public service workers, who should be trusted more.
Mr Blair told the National School of Government conference that public services were different from business because they did not depend on profit and loss.
But there was a danger people did not realise that public services, like businesses, had to be run productively.
"In doing so, we confuse the ethos of public service with the vested interest of keeping things as they are, failing to adapt to necessary change," said Mr Blair.
Schools, hospitals and other services had improved but ministers had to show they were tackling serious failures, such as the recent crisis in tracking foreign prisoners, he said.
Mr Blair continued: "I know that if, having put in this extra money we can't show clearly, demonstrably, that the service has got radically better, then the consent from the public for investment is in jeopardy."
Continual change was needed, he argued, calling for structures which encouraged innovation without "prodding" from government.
Who's to blame?
Last week, Jonathan Baume, general secretary of senior civil servants' union the First Division Association, accused ministers of trying to shift the blame for failing policies on to civil servants.
His comments came after Home Secretary John Reid said parts of his department were not "fit for purpose" and "dysfunctional".
In his speech, Mr Blair said both civil servants and politicians had a "common desire" to improve services, "the issue is how we do it".
He promised to learn from people on the frontline.
Brian Strutton, national secretary of the GMB union, warned: "There is a great danger in trying to compare public services to private companies."
Mr Strutton said he was sure Mr Blair wanted to improve services but the focus should be on quality, not price comparisons with the private sector.
He argued that keeping down public sector pay would demoralise workers rather than encourage them to embrace reform.
His criticism came after Chancellor Gordon Brown suggested public sector pay rises for could be limited to 2% over the next three years to fight inflation.
"Public sector payments must now be founded on meeting that 2% inflation target," he said.
The GMB union said Mr Brown's pay warning would demoralise the very workers who needed to be encouraged to embrace reforms to improve services.
And Liberal Democrat Treasury spokesman Vince Cable said Mr Blair's speech was a "terrible confession of failure".
Labour had ploughed money into public services and were only now recognising that they should have focused on management, argued Mr Cable.