The bulk of this book has tended to use terms such as “public administration” and “bureaucracy” to describe what occurs in the public sector as public policies are implemented, as well as to describe the public employees who perform those tasks and the structures that they inhabit. To many people in government and in academia those terms would appear almost hopelessly outdated. “Public management” has become the more common phrase in contemporary parlance to describe this component of the public sector (see Kettl and Milward, 1996). The changes that have occurred within the public sector in most countries are, however, a good deal more than semantic. The change in terminology implies a substantial transformation in the manner in which the public sector operates, and the way in which scholars and practitioners have come to think about delivering public services. While it is difficult to identify exactly when the shift from public admin istration to the concept of public management occurred, the phrase “New Public Management” (NPM) has become central to describing and understanding what has been happening in government. Christopher Hood describes this term, and this practice, as beginning during the 1980s, in part reflecting the large scale transformation of the state in most Western countries, motivated by politicians such as Margaret Thatcher and Ronald Reagan on the political right. The concern with improving performance in the public sector has not been the sole preserve of the right, however, and in some cases such as New Zealand it was driven instead by parties on the political left (Scott et al., 1990) or in Finland by broad “rainbow” coalitions. The use of the word “new” does indicate that people had talked about man agement in the public sector previously; in particular, several public commissions in the United States and in Canada had emphasized the need for improving the quality of management in the public sector (Arnold, 1998; Sutherland and Doern, 1985). Further, to many people performing the tasks of running large public organizations the distinction between public administration and public management were irrelevant. Both terms meant to them that they had to bring together human, financial and legal resources in order to deliver some sort of service to the public. Still, by the 1980s and 1990s the emphasis on management was becoming dominant, and “administration” came to be considered an old fashioned concern with formal organization and law rather than emphasizing efficiency and performance. Using the concept of “the New Public Management” to describe what has been happening in the public sector also implies that there is a single pattern of behavior that can be described in this manner. In reality, however, a variety of administrative changes have been implemented in the public sector. The dominant pattern of change in government reflect movements toward a market based public sector, and this pattern has become the conventional interpretation of NPM. The market based models of NPM assume a generic style of management, with their advocates considering that running public and private sector organizations are virtually identical tasks. Further, the model tended to assume that public sector employees were involved in their organizations primarily for financial reasons rather than for either a sense of public service or the desire to be involved in a (some societies at least) highly prestigious occupation. Other changes in public management have been motivated more by a participatory style of change – “liberation management” in Paul Light’s terminology
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– stressing the importance of involving members of the lower echelons of the public organizations in decision making within those organizations. This participatory style also seeks to involve clients and even the general public more directly in the public sector. Further, other forms of reform in the public sector stress the need to reduce the level of domination of government by formal rules, and to replace those formal restraints on managers with greater discretion. That discretion is intended to enable public managers to exercise their talents and to produce more effective and efficient public services through management. All of these reforms of public management have stressed the capacity to make government perform its fundamental tasks better, and following from the initial round of change, whether more managerialist or more participatory, has come an increased emphasis on performance management in the public sector. Performance management implies the use of formal means for measuring how well individuals and organizations are doing their jobs (Bouckaert and Peters, 2002). Those measurements are, in turn, to be related to the rewards that the individuals and organizations receive through the budget process. If, in the words of the National Performance Review (Gore Commission) in the United States, government is supposed to “work better and cost less”, then we will have a better chance of knowing how well it is working and perhaps also know how much it costs to produce the goods and services that are being generated through the public sector. Also, the phrase: New Public Management implies that there was an old public management, and indeed there was. This approach to managing in the public sector is often referred to as “scientific management”, and had its heyday during the 1930s and 1940s. In the United States the publication of the Brownlow Report in 1939, with its principles of management derived from scholars such as Gulick and Urwick (1936). In Britain and other countries analogous academic and official reports emphasized the existence of principles that could enable the public (or private) manager to run an organization effectively and efficiently (see Self, 1973). These principles subsequently were questioned and largely debunked by decision making approaches to management (Simon, 1947), but the old public management did influence behavior in public organizations for decades. This chapter will discuss the alternative models of administrative reform, and the role of these reforms in shaping management, within the public sector. This discussion will reflect two waves of change, as implied above. The first wave implemented changes in the managerial and participatory styles mentioned above, and produced often quite fundamental changes in governing. Those changes in turn created a new set of managerial problems for the public sector so that one change was soon followed by an additional set of changes. The second wave has tended to focus more on the performance of public organizations, as well as on finding ways to bring the political leaders who had to some extent been devalued during the initial changes back into the center of governing. Although in this chapter I will focus primarily on the way in which public services are delivered and the way in which people working for government are hired, fired and motivated to perform their tasks, it is important to understand that the New Public Management is more than just a set of ideas about the bureaucracy. Rather, NPM is also to some extent a set of ideas about how government as a
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whole should operate. These ideas involve transforming how citizens relate to government, as well as the ways in which political officials interact with the administrative personnel of government. Both of these dimensions are especially important for the management of the public sector in a democracy. Thus, to some extent a theory of public management is a theory of governance, and directs our attention at the ways in which altering any one aspect of the public sector may have significant consequences for the remainder of the system.