NEW PUBLIC MANAGEMENT

NEW PUBLIC MANAGEMENT

Omar Colmenares Trujillo lawyer, has dedicated this month of July to the study of public management, it is therefore a pleasure to present one of the topics that I am most passionate, a short article on the new public management, this article is based on some academic research carried out by the University of Oxford (England), where we will approach its definition, conceptualization, and evolution, up to the latest advances in this aspect.

to get started, the decade of the 1980s witnessed major changes in the management of public services in various countries, including the extreme cases of the United Kingdom (Hood, 1991), New Zealand (Boston, Martin, Pallot, & Walsh, 1996), and Sweden (Foss Hansen, 2013). These reforms embody the New Public Management (NPM) movement and involve a bundle of radical changes, including privatization and contracting out, marketization of services still inside the public sector, and stronger performance management and manageralization. A typical NPM governance mode is a markets-and-management mix combining more competition among public services agencies with stronger line management within them. In central government, ministries downsize and export operational functions into newly autonomized “executive agencies” (Pollitt, Talbot, Caulfield, & Smullen, 2004), and then performance managed from above through contracts with their ministerial “owner.”

NPM reforms had various objectives, political as well as technical. They tried to shift public organizations away from the old, rule-bound Weberian form, to scale down the large public sectors that had grown up since the 1940s (along with associated high taxation levels), reduce the power of over mighty producers (both trade unions and public services professionals), and create more “businesslike” public services organizations. Government was supposed to become smaller, more entrepreneurial (Osborne & Gaebler, 1992) and to produce more public value (Moore, 1995) from limited resources. The reformed public agencies should seek to achieve high performance levels: “performance” is an important NPM signifier rhetorically, as is the word “entrepreneurial.” The old concern with the quality of the civil service’s policymaking competence was eclipsed by a managerial emphasis on operational “delivery” (another key NPM word). These NPM reforms challenged the traditional public agencies. There is a debate about whether the old Weberian forms will in the end prove resilient (Meier & Hill, 2005) because they remain technically efficient or whether more “entrepreneurial” public agencies are now diffusing rapidly (Osborne & Gaebler, 1992).

he New Public Management (NPM) is a major and sustained development in the management of public services that is evident in some major countries. Its rise is often linked to broader changes in the underlying political economy, apparent since the 1980s, associated with the rise of the New Right as both a political and an intellectual movement. The NPM reform narrative includes the growth of markets and quasi-markets within public services, empowerment of management, and active performance measurement and management. NPM draws its intellectual inspiration from public choice theory and agency theory.

NPM’s impact varies internationally, and not all countries have converged on the NPM model. The United Kingdom is often taken as an extreme case, but New Zealand and Sweden have also been highlighted as “high-impact” NPM states, while the United States has been assessed as a “medium impact” state. There has been a lively debate over whether NPM reforms have had beneficial effects or not. NPM’s claimed advantages include greater value for money and restoring governability to an overextended public sector. Its claimed disadvantages include an excessive concern for efficiency (rather than democratic accountability) and an entrenchment of agency-specific “silo thinking.”

Much academic writing on the NPM has been political science based. However, different traditions of management scholarship have also usefully contributed in four distinct areas: (a) assessing and explaining performance levels in public agencies, (b) exploring their strategic management, (c) managing public services professionals, and (d) developing a more critical perspective on the resistance by staff to NPM reforms.

While NPM scholarship is now a mature field, further work is needed in three areas to assess: (a) whether public agencies have moved to a post-NPM paradigm or whether NPM principles are still embedded even if dysfunctionally so, (b) the pattern of the international diffusion of NPM reforms and the characterization of the management knowledge system involved, and (c) NPM’s effects on professional staff working in public agencies and whether such staff incorporate, adapt, or resist NPM reforms.

New Public Management?

Early academic writing sought to elucidate the emergent phenomenon of New Public Management (NPM) already becoming evident in the public policy world. In the United Kingdom, the first major NPM-oriented public management reforms appeared in the early 1980s; for example, the Griffiths Report (1983) introduced general management into the United Kingdom’s National Health Service (NHS), replacing the old system of consensus management and facilitative administration, which critics argued protected traditional professional dominance (Freidson, 1970).

Political scientists engaged in helpful sense making. Hood (1991) provided an influential definition of the seven core features of NPM reforms, namely, (a) “hands on” professional management, (b) explicit standards and measures of performance, (c) greater stress on output-based controls (since results now matter more than process), (d) a disaggregation of units in the public sector, (e) more competition within the public sector itself, (f) more private-sector-style management practice (including “flexible” human resource management), and (g) the pursuit of efficiency and “doing more with less.” Behind these doctrines lay rising political and societal values that emphasized efficiency and productivity, more so than traditional notions of democratic accountability and due process.

NPM Reforms

A major theme has been exploring patterns of NPM spread and variation internationally. Hood (1995a) identified a cluster of Anglo-Saxon countries as “high-impact” NPM states (e.g., United Kingdom, Australia, Canada, and New Zealand) but also unexpected candidates such as Sweden.

The United States was assessed (Hood, 1995a) as only “medium impact.” The American case can best be seen as an idiosyncratic hybrid that combines elements of NPM with pre-, non- or even anti-NPM strands. Despite displaying a political tilt toward the neoliberal right under President Reagan (1980–1988), it is noteworthy that Hood did not assess America a high-impact NPM jurisdiction.

Pollitt and Bouckaert’s (2011) “country file” on the United States (pp. 321–331) provided an analytic history of what they see as the main public management reforms there since the 1970s. They highlight the antibureaucratic and antiwaste rhetoric behind many successive reforms. Efficiency drives by themselves can be seen as relatively crude and as predating NPM. There has also been a tendency to bring in business people as advisers, reflecting a wider American pro-business culture, and policies to increase the contracting out of public services. Whether these measures represent a coherent NPM style reform package seems more doubtful.

Perhaps the best known American public management reform package was the National Performance Review led by Vice President Gore (Democrat) in the 1990s. The NPR included both a “savings and downsizing theme” (NPM orthodox) and a second “empowerment and reinvention” theme (associated with alternative and softer approaches), and some tensions were evident between them (Pollitt & Bouckaert, 2011, p. 326). Osborne and Gaebler’s (1992) book Reinventing Government represents perhaps the most well-known recent American text on public management reform, so its content is worth a closer look.

This text, too, can be seen as a curious hybrid. It certainly includes some NPM-compatible chapters: chapter 1, “Steering Rather Than Rowing”; chapter 3, “Competitive Government: Injecting Competition into Service Delivery”; chapter 5, “Results-Oriented Government: Funding Outcomes Not Inputs.” However, other chapters introduce very different ideas. Chapter 4, “Mission Driven Government: Transforming Rule-Driven Organizations,” reflects the cultural school of strategy (see Peters & Waterman, 1982, for an analysis of the characteristics of excellent American private firms), with its emphasis on strong and positive collective cultures that provide strong energy for innovation. Chapter 9, “Decentralized Government: From Hierarchy to Participation and Teamwork” is based on a different set of “soft” management ideas of participation, teamwork, quality circles and organizational development.

How can these “medium” levels of NPM impact in the United States be explained, when key American authors (e.g., Niskanen, 1971) have written influential texts that first developed basic public choice ideas? The United States also has well-developed management consultancies and business schools that are seen as important diffusers of NPM ideas globally (Ferlie et al., 2016). One political-science-based explanation for NPM’s weaker internal impact highlights the separation of powers between different branches of United States government (executive, legislative, and judicial) and also the devolution of many competences from the federal to the state level that restrict the ability of the president to engage in centralized top-down reforming. A second explanation could lie in the smaller scale of the American public sector so that the political “pay off” from—and therefore top-level political interest in—public management reform activity was correspondingly lower (Hood, 1995a). The United States does not, then, appear as a centrally important jurisdiction on the NPM radar screen. Interestingly, Halligan’s (2011) analysis of NPM within Anglo-Saxon countries does not consider America at all but instead reviews the four cases of the United Kingdom, Canada, Australia, and New Zealand.

“Low-impact” countries identified by Hood (1995a) included such important cases as Spain, Japan, and Germany. So there were “leaders and laggards” in NPM reform internationally and as yet no radical process of global convergence. Nor did high NPM impact always correlate with right-wing political control; Sweden, for example, was under social democratic control during much of the critical period, while low-NPM-impact Japan consistently had right-wing governments.

This NPM literature relates to the wider convergence (versus) divergence debate. The core question is, will all countries eventually converge in a global NPM reform wave (Hood, 1995b), or will national variation remain strong, reflecting conditions of path dependence? Pollitt and Bouckaert’s (2011) comparativist analysis argued that different tracks of public management reforming remained strongly evident internationally. For instance, Germany is seen as being on a neo-Weberian track and remains largely NPM resistant.

Yet some pro-NPM diffusion forces that may promote global convergence need to be considered seriously. Pierre and Rothstein (2013) have argued that influential international bodies, such as the World Bank, the International Monetary Fund, and the Organization for Economic Cooperation and Development, help export NPM reforms to the developing world as supposed instruments of “good governance” to combat corruption. At least a declared intent to adopt NPM reforms may be a condition of such agencies agreeing to structural adjustment packages.

An analytic focus on international flows of management texts and knowledge (Ferlie et al., 2016) suggests that the expanding management-consulting sector may represent another important diffuser. In addition, well-selling public management texts circulate internationally and are imported by public services organizations. Osborne and Gaebler (1992) is perhaps the best known public-management-based text. Successive private-sector-oriented management texts (from Peters & Waterman, 1982, onward) have also been influential in public services organizations. These texts and models are often produced by elite American management consultancies (e.g., McKinsey’s) or business schools (e.g., by faculty at the Harvard Business School) and later diffuse internationally from the United States and from their original base in the private sector to public sectors in other countries. These credible forces for convergence should be considered, alongside the argument for enduring local conditions and path dependency.

Current trends and future prospects of public management

The UK has played a pivotal role in the development of the New Public Management (NPM) paradigm – and can arguably claim to have been its ‘birthplace’. Indeed, the seminal paper which coined the term the NPM was the product of the UK experience (Hood 1991) – though the work in the US by Osborne and Gaebler (1992) was also important.

However, the impact of the NPM has spread far beyond this narrow focus and it has become one of the dominant paradigms for public management across the world, and in particular in North America, Australasia and the Pacific Rim (Flynn and Strehl 1995; Boston et al. 1996; Kettl 2000; Pollitt and Bouckaert 2000; McCourt and Minogue 2001; Osborne 2002). Both the World Bank and the OECD (Organization for Economic Co-operation and Development) are also now keen advocates of NPM reforms across the world (for example, OECD 1995).

Given the centrality, both of the NPM to the management of public services across the world and of the UK experience to its development, now is a good time to evaluate the nature and impact of the NPM in the UK and internationally. This is particularly so given current reforms across the world, such as the ‘modernising government’ agenda that the current Labour government is committed to in the UK and the programme of government reform embarked upon by the George Bush administration in the US. These developments raise the question of whether the NPM was a specific trend related to a time-specific period, such as the Conservative administration of 1979–97 in the UK, or whether it is likely to continue and/or be modified as a developing paradigm of public management.

This evaluation is the intention of this book. It is unique in that it brings together papers which review the conceptual development of the NPM paradigm, provide evidence of its empirical reality, place it in international context and give consideration of research approaches to its further analysis.

The first part of this book sets the context for the NPM debate as a whole and explores conceptual issues. Osborne and McLaughlin place the NPM in historical context, both in the UK and internationally. They argue that the NPM should not be seen as an approach linked to the marketization of public services alone. They argue that it is more fundamentally concerned with the shift from the unitary government provision and management of public services to the concepts of the plural state and the governance of public services, rather than their management. Barzelay then takes this discussion further by placing the NPM within theoretical developments in the fields of public administration and political science. Sandra Dawson and Charlotte Dargie provide a rather more empirical analysis of the spread and impact of the NPM in the UK, using evidence from the health service. Flynn addresses the important task of providing a typology of approaches under the umbrella of the NPM. He emphasizes the importance of national context for the development of the NPM variants across the world. Finally in Part I, Janet Newman takes the specific context of the modernization agenda of the current Labour government in the UK and the extent to which its discourse is congruent, or otherwise, with that of the NPM. This has import for other such modernization exercises across the world

Written:
Omar Colmenares Trujillo
Investigating Lawyer