Introduction to public administration final

DSS10004 Introduction to Social & Public Administration

Public Management

Ronald C. Moe“Exploring the Limits of Privatization”

Graham T. Allison “Public and Private Management:

Are They Fundamentally Alike in All Unimportant Respects?”

Chung Man Sze 52218730

Cheung Wing Kiu 52221445

Lam Tsz Chung 52217200

Outline

• The definition of public management

• Similarities between public & private management

• Differences between public & private management

• The difficulties of public management

• Is privatization a good way for the improvement of public management?

• The improvement of public management

• The strategy for the development of public management

• Mushkin report identified in 3 core elements– Policy management

• Needs, analysis of option, select of programs & allocation of resources

– Resource management• Basic administrative support systems

– Program management• Policy or daily operation of agencies

1975 Report of The Interagency Study Committee on Policy Management Assistance on OMB – The Definition of “Public Management”

• Webster: Management means the organization and direction of resources to achieve a desired result.

Definition of Public ManagementDefinition of Public Management

Wallance Sayre(1929):The public and private sectors may be alike

in the nonessentials , but it is in the essentials where they differ.

• Acronym “POSDCORB”• Planning• Organizing• Staffing• Directing• Coordination• Reporting• Budgeting

Similarities of Public & Private ManagementSimilarities of Public & Private Management

Divided into three parts- Strategy- Managing internal components- Managing external constituencies

Functions of general managementFunctions of general management

Strategy

- Establishing Objective and Priorities(優先次序 ) for the organizationBase on the forecasts of the environment and the organization’s capacities - Devising Operational Plans to achieve these objectives

Managing Internal Components

- Organizing and Staffing

The manager establishes structure & procedures in staffing

Structure assign the authorities and responsibilities to the units and positions

Procedures coordinating activity and taking action

- Directing Personnel and the Personnel

Management SystemThe capacity members and their skills and knowledge

Personnel Management System recruit, selects, socializes, trains, reward ,punishes and exits employeesits goals specific directions from management

- Controlling Performance

Various management information systems making decisions & measuring progress towards objectives

Managing external constituencies

- Dealing with “External” Units subject to some common authority

dealing with other general managers within organization (above, laterally and below) achieve their unit’s objectives

Managing external constituencies

- Dealing with Independent OrganizationsAgencies with other organization or groups the organization’s abilities to achieve the goals - Dealing with Press and PublicAction or approval or acquiescence is required

John T. Dunlop “Impressionistic comparison of John T. Dunlop “Impressionistic comparison of government management and private business”government management and private business”

Hal Rainey , Robert Backoff and Charles Levine Hal Rainey , Robert Backoff and Charles Levine “Public administration review research “Public administration review research

development”development”

Richard E. Neustadt Richard E. Neustadt “Six major differences between U.S. Presidents and “Six major differences between U.S. Presidents and

Chief Executive Officers of major corporations Chief Executive Officers of major corporations

According to the first article:Fundamental Costitutional Difference

Business Sector:- General Functions Individual – CEOGovernment(U.S Government):- General Function Competing Institutionsthe executive , two houses of Congress & the courts

Time perspective

Government management- Short time horizons dictated by political necessities and political calendarPrivate management - Longer time perspective (market development, technological innovation & investment, organization building)

John T. Dunlop “impressionistic comparison of John T. Dunlop “impressionistic comparison of government management and private business”government management and private business”John T. Dunlop “impressionistic comparison of John T. Dunlop “impressionistic comparison of government management and private business”government management and private business”

Duration

Government management- Relatively short- dangerous for fostering a successorsPrivate management- Longer - Responsible to train a successor or several possible candidates

Measurement of performance

Government management- little agreement on the standard and measurement of performancePrivate management- various tests of performance for executive compensation

Personnel constraintsGovernment managementPolitical appointees high-level personnel in the hierarchy supervisory personnelCivil service union contract provision and other regulations complicate the recruitment, hiring, transfer, and layoff or discharge of personnel of personnel to achieve managerial objectives or preferencesMore under control of staffPrivate management- Greater latitude (much more authorities to direct the employees)

Persuasion and direction

Government management- seek to mediate decisions response to the pressures and must put together a coalition of inside and outside groups to survivePrivate management- Direct or issue orders to subordinates by superiors managers(little risk of contradiction)- Look more to one higher authority

Equality and efficiencyGovernment management - Provide equity among different constituenciesPrivate management - Greater stress is placed upon efficiency and competitive performance

Public processes versus private processGovernment management- exposed to public scrutiny and to be more open Private management- process more internal and less exposed to the public

Role of Press and Media

Government management- contend regularly with the press and mediaPrivate management- less often reported in the press

Legislative and judicial impactGovernment management- subject to close scrutiny by legislative oversight groupsPrivate management- Uncommon in private business

Bottom line Government management- Rarely clear bottom linePrivate management- For profit, market performance and survival

Public Management Private Management

Time perspective Short time horizons dictated Longer time

Duration Short(cannot train successor)

LongResponsible to train successor

Measurement of performance little agreement of measurement various tests of performance

Personnel constraints Subject to Civil Service System Greater latitude towards managers

Equality and efficiency equal among different constituencies Focus on efficiency and competitive performance

Public processes versus private process

More exposed to the public Less exposed to the public

Role of Press and Media Contend regularly Less often reported

Persuasion and direction Seek to mediate decisions Direction or issuance

Legislative and judicial impact

Subject to close scrutiny Administrative freedom to act

Bottom line Rarely clear bottom line Profit, market performance and survival

John T. Dunlop “impressionistic comparison of government management and private business”John T. Dunlop “impressionistic comparison of government management and private business”John T. Dunlop “impressionistic comparison of government management and private business”John T. Dunlop “impressionistic comparison of government management and private business”

Degree of market exposure (reliance on appropriate)

- less incentive to cost reduction, operating efficiency, effective performance - lower allocational efficiency - lower availabilities of market indicators and information

Legal, formal constraints (courts, legislature, hierarchy)

- More constraints on procedures, spheres of operations

- Greater tendency to proliferation of formal specifications and controls

- More external sources of formal influence, and greater fragmentation of those sources

Political influences

- Greater diversity of intensity of external informal influences on decisions

- Greater need for support of “constituencies”

Coerciveness (“coercive,” “monopolistic,” unavoidable nature of many government activities)- A more likely that participation in consumption and financing of services will be unavoidable or mandatory

Breadth of impact- Broader impact , greater symbolic significance of actions of public

Public scrutiny- Greater public scrutiny of public officials and their actions

Unique public expectations- Greater public expectations that public officials act with more fairness, responsiveness, accountability and honesty

Complexity of objectives, evaluation and decision criteria

- Greater multiplicity and diversity of objectives and criteria- Greater vagueness and intangibility of objectives and criteria- Greater tendency of goals to be conflicting

Authority relations and the role of the administrator

- Less decision-making autonomy and flexibility on the part of the public administrators- Weaker more fragmented authority over subordinates and lower levels- Greater reluctance to delegate, more levels of review, and greater use of formal regulations- More political, expository role for top managers

Organizational performance

- Greater cautiousness, rigidity, less innovativeness- More frequent turnover of top leaders due to elections and political appointments results in greater disruption of implementation of plans

Incentives and incentive structures

- Greater difficulty in devising incentives for effective and efficient performance- Lower valuation of pecuniary incentive by employees

Personal characteristics of employees

- Variations in personality traits and needs, such as higher dominance and flexibility, higher need for achievement, on part of government managers- Lower work satisfaction and lower organization commitment

1. Short time perspective2. Less authorities

a. No agreement of performance measurementb. Subject to Civil Service System (for managers who making decision)c. Share authority with the Congressd. Subject to legislative oversight groups or and judicial orders for executive and administrationf .Provide equity among different constituenciesg. Subject to public scrutinyh. Great influence of press and media on making decision

3. Less efficiency- less market exposure

The difficulties of public managementThe difficulties of public management

Some functions performed by government are assigned to private sectors units, directly or indirectly, or left to the play of market place.

What is privatization?What is privatization?What is privatization?What is privatization?

The Privatization Movement:1. Perform more efficiently & economically2. All functions are interchangeable

Barry Bozeman:1. Present & Inevitable2. The desired way to plan for the future3. Public & Private sectors are alike in the essentials,

differing only in the nonessentials

The believes of the PromotersThe believes of the PromotersThe believes of the PromotersThe believes of the Promoters

encourage combining elements of the public and private sectors

∵ the political arena the judicial arenain major policy and managerial decisions

∵ integrate its economic theory with thecomplementary theories of public law= the Achilles Heel(致命傷 ) of privatization

In the basis:In the basis: In the basis:In the basis:

The Twilight Zone- subject to the law applicable to its body(its operation , productivity and expenditure) Is it “private ” in its legal status?

- bridge in legal and organizational termsthe public and private sectors problems = weaken the capacity of theentity to achieve its assigned mission.

Limitations of PrivatizationLimitations of PrivatizationLimitations of PrivatizationLimitations of Privatization

Fundamental distinction Sovereign

- The government possesses the rights andimmunities of the sovereign.- A sovereign cannot assign its attributes to a private

party and remain a sovereign.- It would permit another body to determine the fate of

the sovereign.

Third-party government

- Contract an inevitable weakening in the lines of political accountability.

A private entity = indirect and tenuous ∵

∴decision-making capacity ↓ private for-profit & not-for profit corporation.

National Security

× delegate sensitive national security operations to private parties.

Public Safety

Lawmakers feel obligated to consider public safety factors in the assignment process.

Corruption

substantial sums of money

Private Parties ∵ go to the edge of the law

Effects of Privatization towards the Public Effects of Privatization towards the Public Effects of Privatization towards the Public Effects of Privatization towards the Public

received fromhttp://cusa-cuhk.com/stot/Privatization.pdf

Reason of Privatization:Reason of Privatization:- Former Chief Executive Tung Chee-hwaFormer Chief Executive Tung Chee-hwa1.Eighty-Five Thousand Housing Projects(1.Eighty-Five Thousand Housing Projects( 八萬五建屋計劃八萬五建屋計劃 ))Expenditure↑↑↑Expenditure↑↑↑

2.Discontinue Home Ownership Scheme2.Discontinue Home Ownership SchemeWorking Capital ↓↓↓Working Capital ↓↓↓

The Hong Kong Housing Authority The Hong Kong Housing Authority 1.1. Sell part of its public housing shopping malls, car parks and Sell part of its public housing shopping malls, car parks and

marketsmarkets

2.2. Establish “The Link” & Public OfferingsEstablish “The Link” & Public OfferingsCapital Raising Capital Raising

Real Case Study: Real Case Study: The Link Real Estate Investment TrustThe Link Real Estate Investment TrustReal Case Study: Real Case Study: The Link Real Estate Investment TrustThe Link Real Estate Investment Trust

Public Offerings of “The Link REIT”- The First Public Offerings

Lo Siu Lan = Public Housing Residentschallenged the legality of this public offerings

Rent of Public Housing ↑↑(without the rent of public housing shopping malls)Price level in public housing shopping malls↑↑

(without consideration towards public)

The public offerings was postponed The second public offerings was successful

The Effects:

For Public Housing Residents:The price level in public housing shopping malls ↑↑↑living-

burden ↑↑↑ ↑↑↑chain stores in shopping malls ↑↑↑Shop rents ~>Consumers

For Tenants of Shopping Malls & Markets: medium-small shops ↓↓↓↓↓↓↑↑↑chain stores in shopping malls ↑↑↑Shop rents

an articulation of the general management functions

a self-consciousness about the general public management point of view

cannot rely on common sense and knowledge

Improvement of the performance of public managementImprovement of the performance of public management

The strategy for the development of public The strategy for the development of public managementmanagement

-Developing a significant number of cases on public management problems and practices

-Analyzing cases to identify better and worse practice

- Promoting systematic comparative research

- Linking to the training of public management

Introduction to public administration final

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