New Public Management or Achieving High Performance in the Public Sector

WHAT NEEDS TO BE DONE?

Abstract

In the past few decades, various attempts have been made to improve performance in the public sector. These improvement programmes have had mixed and sometimes even detrimental results. Consequently, there is an increasing demand for methods which enable organisations to achieve sustainable high performance. One such a method is offered by the High Performance Organisation Framework, describing the five success factors that create a high performance organisation (HPO). By focusing on these ‘HPO factors’, public sector organisations could increase their chance of becoming high performing considerably. Research on HPOs shows that public sector organisations score worldwide significantly lower on the HPO factors than excellent – predominantly private sector – organisations do, which suggests that there is a lot of room for improvement in the public sector. Further HPO research identified six public sector specific improvement themes which need to be addressed to improve the scores on the HPO factors in public organisations. These are: identifying the profile of an excellent public sector manager, strengthening the resoluteness of management, excelling in the core competence of public sector organizations (which is ‘client dedication’), improving the performance management process of the organisation, improving process management within the organisation, and increasing the quality of the workforce. If governments were to focus their attention on improving these themes, high performance governmental organisations would actually be created, and thereby added value to society. This paper describes the HPO Framework and the results of applying this framework in the public sector worldwide.

New Public Management

Ever since the publication of the book Reinventing Government (Osborne and Gaebler, 1992), interest in effectiveness and efficiency of the public sector has been growing. The New Public Management (NPM) programme (Politt, 2003) attracted most attention, reaching its high point in many countries at the beginning of this century (Smidt, 2007). An important goal of New Public Management was to make public agencies more transparent by applying performance management. The reason for this was that studies in the public sector showed that by implementing performance management, public sector organisations were more likely to achieve their objectives, provide better services to citizens and companies, and improve their overall efficiency (National Partnership for Reinventing Government, 1999; United States General Accounting Office,1999; Executive Session on Public Sector Performance Management, 2001; Moriarty and Kennedy, 2002; Waal and Kerklaan, 2004). The aim of performance management in the public sector was to make objectives, performance and (used) resources explicitly clear; integrate financial and non-financial information; integrate the policy and budget cycles; and improve quality, accessibility and information content of the management information. The existing budgeting system, which mainly focused on resource application, had to be replaced by a budgeting system with an explicit link between objectives to be achieved, required resources to achieve them, and the expected and realised results (Waal and Kerklaan, 2004). Other New Public Management programmes focused on the need for public agencies and politicians to show better results faster in order to diminish the growing dissatisfaction among citizens with governmental performance, and proposed further development of performance management in Dutch public agencies.

Despite its popularity, there were also advocates against the New Public Management, such as Savoi (2005, p.593) who called New Public Management a “flawed concept”, or Radin (2006) who stated that the advocates of New Public Management, and especially the performance part of it, too easily “gloss over” the problems with performance management in the public sector. In fact, it is now generally acknowledged that many of these improvement programmes, although still often in place, have at best had mixed results and often failed to achieve their main objective of improving public service (Moynihan, 2006; Smidt, 2007; Alford and Hughes, 2008; Bogt, 2008; Balaguer-Coll and Prior, 2009; Fryer et all., 2009). An interesting study (Tambulasi, 2009) found that implementing New Public Management reforms actually led to increased levels of corruption in local government. A recent study (Kirby, 2009) even states that there is a crisis of government because “faith in the ability of the State to govern well has all but disappeared.” The author argues that government tries to play down the disappointing results with a variety of methods like moving goalposts (changing pre-set targets to less ambitious levels), using public relations to ‘spin’ bad performance into acceptable results, and using complex structures, procedures and language, so people cannot follow and do not really understand what the government has achieved. However, this myriad of smoke-screen techniques cannot hide that government’s performance is in urgent need of improvement and that managers of governmental bodies have to explore the possibilities to increase governmental results in a sustainable way. In this respect, new ways to improve the performance of governmental organizations is needed. One possibility is offered by the high performance organisation (HPO) framework. This article describes the HPO Framework and the results of applying this framework in the public sector worldwide. Specifically, the six improvement themes that need to be addressed by public management in order to transform their organisations into high performance governmental organisations are discussed. The article concludes with a practical example of applying the HPO Framework by evaluating the recently published Dutch Public Service Reform Memorandum and identifying the additional improvement actions which have to be taken.

Read the complete article New Public Management or Achieving High Performance in the Public Sector by André de Waal in PDF.

Also read the articles Achieving a High Performance Government