What is the Challenge and Can the Traditional Providers Respond

1
What is the Challenge and Can the Traditional
Providers Respond?

• Professor Ian Sanderson
• Policy Research Institute,
• Leeds Metropolitan University
• Presentation to Institute of Public Sector
  Management Annual Conference,
• Birmingham, 8th November, 2001

2
Outline of Presentation

• The Changing Nature of Governance
• Modernising Government
• Performance
• Partnership
• People
• Cabinet Office Peer Review

3
The Changing Nature of Governance

• Late Modernity and Connexity
• Demise of big government
• Rise of networks relational interaction
• Governance as self-organising, inter-organisationa
  l networks
• Limits to control/steering

4
The End of Command and Control?

• The NHS is the last of the communist-style
  command-economy state organisations, the largest
  employer in the free world, paid for by a cheque
  from the Chancellor, managed by a central
  government ministry, dictating everything from
  what drugs to prescribe to what meals to serve,
  through the daily issuing of thousands of targets
  and initiatives that are baffling even to those
  who are supposed to carry them out. The failure
  of the politically controlled, state-funded NHS
  is sadly as inevitable as the failure of the
  politically controlled communist economies.
• Anthony Browne, Observer, 7/10/01

5
Modes of Governance

• Steering / regulation
• set course / correct deviations
• management by control
• Self-steering / self-regulation
• set objectives / adjust through feedback
• management by objectives
• Reflexive / interactive governance
• strategic guidance and network co-ordination
• management by negotiation / facilitation /
  influencing
• from linear to reflexive models

6
Interactive Governance

• Amin and Hausner (1997)
• The rationality of interactive governance is
  that of process and procedure, focusing on
  building capacity, securing institutional
  innovation and adaptability, deriving efficiency
  through social cohesion and involvement, and
  obtaining solutions through interaction, dialogue
  and confrontation ( p.27)
• Mulgan (1998)
• steady shift beyond command and control (p.
  193-4)
• government less as a closed system with a
  monopoly of power and more as an open system
  engaged in negotiation with other parties (p.
  195)
• steer when steering is necessary, but also
  strengthen the capacity of citizens and
  communities to govern themselves (p. 206)

7
Modernising Government Aim

• Government matters. We all want it to deliver
  policies, programmes and services that will make
  us more healthy, more secure and better equipped
  to tackle the challenges we face. Government
  should improve the quality of our lives.
• People want government which meets their needs,
  which is available when they need it, and which
  delivers results for them.
• Modernisationmust be for a purpose to create
  better government to make life better for
  people.
• Modernising Government White Paper, 1999

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Modernising Government Objectives

• Policies more forward looking, inclusive and fair
  
• Stronger leadership with clear sense of purpose
• Better business planning from top to bottom
• Sharper performance management
• Joining up across government
• Improvement in diversity
• Services more open and responsive to people and
  ideas
• Better deal for staff
• Use of new technology in delivering services

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Modernising Government Key Themes

• Performance
• Partnership
• People

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The Rise and Rise of Performance Management

• 1982 Financial Management Initiative
• 1988 Next Steps Initiative
• 1991 Citizens Charter
• 1998 Comprehensive Spending Review PSAs
• 1999 Modernising Government White Paper
• 2000 Spending Review SDAs

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Modernising through Performance Management

• Additional resources conditional upon clear
  objectives, higher standards, improved
  productivity, and the reforms needed to deliver
  the modern public services the public needs.
• Prime Minister, Cm. 4181, 1998
• Performance is the cornerstone of our commitment
  to modernise government. It provides some of the
  tools needed to bolster improvements in public
  sector performance including improving
  accountability, performance management, risk
  management and business planning
• NAO, HC301, 2001

12
Issues for Performance Management

• Degree of top-down control / steering?
• Can measurable targets capture the true purpose
  and value of public services?
• Does it hinder joined-up governance?
• Does it encourage manipulative behaviour and
  cynicism?
• Does it undermine the commitment of staff and
  relationships of trust?
• Does it encourage improvement on the basis of
  learning?
• Is it compatible with contemporary modes of
  governance?

13
The Myth of Measurement?

• Measurement often misses the point, sometimes
  causing awful distortions... Many activities are
  in the public sector precisely because of
  measurement problems If everything was so
  crystal clear and every benefit so easily
  attributable, those activities would have been in
  the private sector long ago.
• Henry Mintzberg

14
Partnership

• New Labour
• from contract to partnership culture
• joining up across government
• Hybrid model of governance?
• Joining up public-public partnership
• Diversity in service provision public-private
  partnerships

15
Issues for Public-Public Partnerships

• Administration
• Information
• Finance
• Culture
• Power
• The prospects are uncertain, given the degree to
  which organisations like to work independently
  and preserve their traditional territories
• Balloch and Taylor, 2001, p. 298

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Issues for Public-Private Partnerships

• Is their commitment to public services and
  adequate funding?
• Does the public sector have the capacity to
  manage partnerships effectively?
• Is their commitment in the private / voluntary
  sectors to quality, accountability and trust?
• Do citizens and employees have confidence in the
  principles and practice of partnership?
• Do we have adequate evidence on
• what works for successful partnerships?
• effectiveness of private sector management in
  public service value context?
• cost-effectiveness of PFI
• IPPR (2001)

17
The Potential for Public-Private Partnership?

• The modernisation of government will require the
  public and private sectors to work together more
  effectively At the moment much of government is
  not set up to be an effective partner. It has
  severe shortages of skills, those that it has are
  often unexploited, it finds it hard to learn from
  past mistakes, it is poor at picking quality
  partners and it is fiendishly difficult to get
  different bits of the public sector to work
  together to purchase services.
• IPPR, 2001, p. 176

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The Role of PFI?

• the Private Finance Initiativeis a pernicious
  scam. The public hospitals, roads, schools and
  prisons constructed with private money generally
  cost more than their public equivalents, while
  delivering worse services.
• George Monbiot (2001)

19
People

• Paradigm shift in understanding organisations
• from formal to informal
• from structures/systems to culture/normative
  order
• from management control to facilitation of
  self-organisation
• from Taylorist task management to
  knowledge/people management
• from tools and techniques to social capital and
  leadership
• Key challenge developing organisational
  capability through learning

20
Strategic HRM

• Matching human resources to strategic needs of
  organisation
• Developing human capital
• knowledge / skills / psychological contract
• Employee development focused on soft
  skills/practices
• communication / interpersonal skills / leadership
  / well-being

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The People Challenge

• Of course, managers need the skills and
  capacities to ensure that the systems and
  processes of the formal organisation work
  effectively But of greater importance is an
  awareness of how the organisation works
  underneath this formal veneer and a capacity
  to mould the values, incentives and informal
  rules that make the organisation tick.
• Sanderson (2001))
• As with any paradigm shift, the main obstacles
  to change arent physical. They lie in
  traditional comfort zones mindsets that are
  happier with hard quantification of physical
  capacities and utilisations than soft
  measurement of intangibles
• CIPD (2001, p. 12)

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Cabinet Office Peer Review (1)

• Joining up is a mind-set and a culture. It is
  not a system or a structure The key to joined-up
  government is to learn about shared purpose,
  teamwork, partnerships and building
  relationships. Joined-up organisations are built
  around the knowledge and know-how of people.
• (paras. 3.6.1-2)

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Cabinet Office Peer Review (2)

• A learning organisation is much more than
  training and development. It understands that
  learning is central to its mission and essential
  to its ongoing relevance. A learning organisation
  is characterised by its ability to continually
  improve performance through new ideas. It is able
  to anticipate. It finds new and better ways to
  fulfil its mission. A learning organisation is
  built around people, their knowledge, know how
  and ability to innovate.
• (para. 5.5.1)

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Cabinet Office Peer Review (3)

• There is a need for a compelling articulation of
  the importance of the public service in
  contemporary terms. It should talk of the value
  added of the public service in a global
  environment, in a knowledge-based economy, in a
  knowledge-based society.
• (para. 4.5.5)