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IJPSM
16,3 Change management practices
Is a hybrid model a better alternative for
public sector agencies?
230
Kerry Brown and Jennifer Waterhouse
Queensland University of Technology, Brisbane, Australia
Christine Flynn
Department of Main Roads, Brisbane, Australia
Keywords Performance management, Change management, Public sector,
Organizational culture
Abstract During the last two decades the public sector has come under increasing pressure to
improve performance and demonstrate greater transparency and accountability. This pressure
has resulted in public sector organisations facing shifts in ways of operating. Various corporate
change strategies have been adopted by different public sector agencies, many of these cloning
managerial practices from the private sector. These changes in public sector organisations have
enormous significance for regional economic and social development. While there is a growing
body of knowledge dealing with the management of corporate change there are still significant gaps
in understanding the process. While there is much written on public versus private corporate
change, there is little distinguishing between change in different types of public sector
organisations. This paper analyses change management processes and seeks to determine whether
a hybrid model of “new public management” delivers more favourable outcomes than a model
focused on cost reduction and private sector prejudice for the bottom line.
During the late twentieth century, governments have been faced with an
emerging public conviction that public sectors are too large and inefficient
(Capling et al., 1998). In response to such pressure and faced with a more
complex operating environment, public sectors have been reformed by
adopting managerial principles grouped under the rubric of new public
management (NPM) (Hood, 1991). These principles are aimed at changing the
public sector in three areas, summarised by Maor (1999) as first, a change from
hierarchical to economically-based structures, second from regulative to
economically-based processes and third, from legally based to economically-
based values. In seeking to achieve these goals, the public sector has employed
various means such as downsizing, devolution of managerial responsibility
(Yeatman, 1994) and introducing such managerialist methods as total quality
management (TQM) and reengineering (O’Donnell, 1996). Many of these
practices first emerged in the private sector with the result that the public
sector has moved increasingly to resemble its private sector counterparts.
The International Journal of Public
Sector Management DiMaggio and Powell (1983) describe this trend as a process of engaging in
Vol. 16 No. 3, 2003
pp. 230-241
isomorphic behaviour. The extent to which such practices have been adopted
q MCB UP Limited
0951-3558
has significantly varied between, not only public sectors of various countries,
DOI 10.1108/09513550310472311 but institutions within those countries. Debates with regard to NPM and the
variety of forms adopted have been based on the argument that while NPM has Change
encouraged private sector isomorphism, there may be risks associated with management
adopting wide-scale private sector practices. practices
The Department of Main Roads in Queensland Australia (DMR) has
undertaken a unique change management strategy that adopts many of the
underlying principles of NPM while at the same time preserving certain
elements of more traditional public sector culture. This paper reports on initial
231
findings of a longitudinal study being conducted to determine whether a hybrid
model of NPM delivers more favourable outcomes than a model focused solely
on cost reduction and private sector prejudice for the bottom line. To place
these findings within the NPM context, this paper commences with an
overview of the current debate in regard to the perceived benefits and
deficiencies of NPM. The discussion highlights the differences between the
public and private sectors and the risks associated with the public sector too
closely mirroring the management practices of the private sector. In particular,
issues in regard to public sector requirements for transparency in reporting,
accountability, politicisation and the non-market structure of governance will
be considered. As a means of meeting the challenges posed by these
constraints, the hybrid model of NPM is presented and the findings and
learnings to date are considered.
Conclusion
This paper has discussed the principles of NPM and how these have been
manifested in the public sector through the espousal of private sector
management practices. It has been demonstrated that there are difficulties
associated with implementing private sector managerial practices into the
public sector and that the reasoning behind the adoption of such practices is
flawed. Rather than seeking to improve efficiency and effectiveness,
isomorphic behaviour has occurred in the public sector aimed at making
public sector entities more like their private sector counterparts. Such action is
argued to have occurred through a desire to display “ideological commitment”
rather than an aspiration to adopt “best practice”. It has been argued that
attempts to implement NPM have often failed due to insufficient consideration
of the contextual and cultural framework of the public sector and that these
contextual factors militate against transferring unproblematically private
sector practices into the public sector. The case of the DMR in Queensland was
then presented which represents a deviation from such isomorphic behaviour.
It demonstrates that a hybrid model of NPM has been able to deliver superior
outcomes for employees as well as political and public stakeholders. Such a
model has taken advantage of the best of both bureaucracy and more
egalitarian styles of management through the development of a relational
culture while balancing its outcomes through the adoption of a balanced
scorecard that focuses on finance, operational efficiency, customer/stakeholder
satisfaction and human resources management.
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