INTRODUCTION TO PUBLIC MANAGEMENT UNIT II 1–0 BABY THOMAS 2015-16
UNIT II
LEARNING OBJECTIVES
1. DISTINGUISH BETWEEN PUBLIC AND PRIVATE SECTORS
2. FUNCTIONS OF PUBLIC MANAGEMENT
3. STRATEGIC MANAGEMENT PROCESS N PUBLIC SECTOR
4. ORGANIZING FUNCTION IN PUBLIC MANAGEMENT; LEADERSHIP IN PUBLIC
SECTOR ORGANIZATIONS
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1. Authority to revise the organization and key
positions
2. Continuity of leadership to implement long range plans.
3. Excess funds distributed as a bonus or salary increase.
4. Objectives measured by results. (Profit)
5 Anonymity, isolation from the media.
1. Structure may be influenced by outside and special interest groups.
2. Time for accomplishment limited by the election process.
3. Punished for operating below budget.
4. Objectives measured by process. (Programs)
5. High visibility, pursued by the media.
1. DISTINGUISH BETWEEN PRIVATE AND
PUBLIC SECTOR MANAGEMENT
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6. Reduce costs by
selectively
cutting specific projects.
7. Rewards for achievement.
8. Selects “Expert” board to
set general operating
policies.
9. Operations geared to
effectiveness.
10. Top management evaluated
by overall effectiveness.
6. Reduce costs by across-the-
board program cuts.
7. Punishment for failure.
8. Must educate a volatile board to
the policy setting role.
9. Operations geared to efficiency.
10. Top management evaluated by
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1. DISTINGUISH BETWEEN PRIVATE AND
PUBLIC SECTOR MANAGEMENT
A process that includes defining goals, establishing strategy, and developing
plans to coordinate activities.
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4.1. Planning
Determining what tasks are to be done, who is to do them, how the tasks are
to be grouped, who reports to whom, and where decisions are to be made.
4.2. Organising
Staffing is the process of setting job requirements through recruitment, selection,
appraisal, compensation, training and development of candidates so as to
accomplish the tasks effectively.
4.3. Staffing
Directing involves determining the course, giving order and instruction and
providing dynamic leadership.
4.4. Directing
4.5. Controlling
Monitoring activities to ensure they are being accomplished as planned and
correcting any significant deviations.
2. FUNCTIONS OF PUBLIC MANAGEMENT
Origin of the word ‘strategy’: The term strategy has been derived from the Greek
word ‘strategos’ that means general. The meaning of strategy is, thus, portrayed as
‘the art of general’.
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Stakeholders in business: The most important stakeholders in business are
owners, customers, suppliers, employees, and society at large.
Discussion question: Why some firms outperform others in the marketplace?
Examples of strategy: Examples of strategy are geographic expansion,
diversification, acquisition, product development, market pénétration,
retrenchment, divestiture, liquidation, and joint ventures
Competitive advantage: Competitive advantage is anything that a firm does
especially well compared to rival firms
What is a strategy? Strategy is a plan, derived from the objectives of an
organization, that means ‘what to do’ for achieving those objectives.
Strategic competitiveness: Strategic competitiveness is one that is difficult
for competitors to imitate.
STRATEGIC MANAGEMENT PROCESS IN PUBLIC SECTOR - TERMINOLOGY
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WHAT IS STRATEGIC MANAGEMENT?
Strategic management is the art and science of formulating,
implementing and evaluating strategies that enable an
organization to achieve its objectives.
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STRATEGIC MANAGEMENT PROCESS IN PUBLIC SECTOR
Strategy formulation
Strategy implementation
Strategy evaluation
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Strategy Formulation
Strategy formulation includes developing a vision and mission, identifying an
organization’s external opportunities and threats, determining internal strengths
and weaknesses, establishing long-term objectives, generating alternative
strategies, and choosing particular strategies to pursue.
Vision is the guiding philosophy that clearly defines the firm’s “reason” for being
in business. Where the organization wants to be or how it wants to
be viewed at some point in the future.
Mission is a statement that clearly defines the firm’s “reason” for being in
business. Mission is an organization’s basic purpose and scope of operations.
Distinction between a strategic vision and a mission:
A strategic vision portrays a company’s future business scope (“where we are
going”) whereas a company’s mission typically describes its present business and
purpose (“who we are, what we do, and why we are here”).
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Strategy Implementation
– Strategy implementation requires a firm to establish annual
objectives, devise policies, motivate employees, and
allocate resources so that formulated strategies can be
executed
– often called the action stage
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Strategy Evaluation
Strategy evaluation reviews external and internal factors that
are the bases for current strategies, measuring performance,
and taking corrective actions.
Strategy formulation, implementation, and evaluation activities
occur at three hierarchical levels in a large organization:
corporate, divisional or strategic business unit, and functional.
Strategic management helps a firm function as a competitive
team.
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DECISION MAKING IN PUBLIC SECTOR
Decision making is a process of developing and
analyzing alternatives and choosing the best
alternative from among them.
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Types of Decisions
1. Programmed Decision
– A decision that is repetitive and routine and can be made by using a definite, systematic procedure.
2. Non-programmed Decision
– A decision that is unique and novel.
Programmed
Decisions
Non-programmed
Decisions
Top
Level in
Organization
Bottom
Ill-structured
Type of
Problem
Well-structured
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The Decision-Making Process
1. Define the problem
2. Clarify the objectives
3. Identify alternatives
4. Analyze the consequences
5. Make a choice
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Step 1. Define the Problem
1. Start by writing down the initial assessment of the
problem.
2. Dissect the problem.
– What triggered this problem?
– Why am I even thinking about solving this problem?
– What is the connection between the trigger and the
problem?
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Step 2. Clarify the Objectives
1. Write down all the concerns that are to
be addressed through the decision.
2. Convert the concerns into specific,
concrete objectives.
3. Separate ends from means to establish
the fundamental objectives.
4. Clarify what each objective means.
5. Test the objectives to see if they
capture the interests.
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Step 3. Identify Alternatives
1. Generate as many alternatives as possible.
2. Expand the search by checking with experts.
3. Look at each of the objectives and ask, “how?”
4. Know when to stop.
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Step 4. Analyze the Consequences
1. Solving problems by thinking through the process
involved from beginning to end, imagining, at each step,
what actually would happen.
2. Eliminate any clearly inferior alternatives.
3. Organize the remaining alternatives that provide a
concise, bird's-eye view of the consequences of pursuing
each alternative.
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Step 5. Make a Choice
Analyses are useless unless the right choice is
made.
– Under perfect conditions, simply review the
consequences of each alternative, and choose the
alternative that maximizes benefits.
– In practice, making a decision—even a relatively
simple one like choosing a computer—usually
can’t be done so accurately or rationally.
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LEADERSHIP IN PUBLIC SECTOR ORGANIZATIONSTERMINOLOGY
“ Leadership is the ability to secure desirable action from a
group of followers voluntarily, without the use of coercion”.
Alford and Beatly
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LEADERSHIP STYLES IN PUBLIC SECTOR ORGANIZATIONS
1. Autocratic (Authoritarian)
2. Bureaucratic
3. Democratic
4. Laissez-Faire
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Autocratic (Authoritarian)
Manager retains power (classical approach)
Manager is decision-making authority
Manager does not consult employees for input
Subordinates expected to obey orders without explanations
Motivation provided through structured rewards and punishments
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New, untrained employees
Employees are motivated
Employees do not respond to any
other leadership style
High-volume production needs
Limited time for decision making
Manager’s power is challenged by an
employee
When to use autocratic style?
Bureaucratic
Manager manages “by the book¨
Everything must be done according to procedure or policy
If it isn’t covered by the book, the manager refers to the next level above him or her
Police officer more than leader
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Performing routine tasks
Need for standards/procedures
Use of dangerous or delicate equipment
Safety or security training being conducted
Tasks that require handling cash
When to use bureaucratic style?
Democratic
Often referred to as participative style
Keeps employees informed
Shares decision making and problem solving responsibilities
“Coach” who has the final say, but…
Gathers information from staff members before making decisions
Help employees evaluate their own performance
Allows employees to establish goals
Encourages employees to grow on the job and be promoted
Recognizes and encourages achievement
Can produce high quality and high quantity work for long periods of time
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To keep employees informed
To encourage employees to share in decision-making and problem-solving
To provide opportunities for employees to develop a high sense of personal growth and job satisfaction
Complex problems that require a lots of input
To encourage team building and participation.
When to use democratic style?
Transformational
Charismatic and visionary
Inspire followers to transcend their self-interest for the organization
Appeal to followers' ideals and values
Inspire followers to think about problems in new or different ways
Common strategies used to influence followers include vision and framing
Instils feelings of confidence, admiration and commitment
Stimulates followers intellectually, arousing them to develop new ways to think about problems.
Uses contingent rewards to positively reinforce desirable performances
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When leaders want members to be an active part of the organization and have ownership to it
When leaders are building a sense of purpose
When the organization has a long term plan
When people need to be motivated
When to use transformational leadership style?
Laissez-Faire
Also known as the “hands-off¨ style
Little or no direction
Gives followers as much freedom as possible
All authority or power is given to the followers
Followers must determine goals, make decisions, and resolve problems on their own.
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Employees are highly skilled, experienced, and educated
Employees have pride in their work and the drive to do it successfully on their own
Outside experts, such as staff specialists or consultants are being used
Employees are trustworthy and experienced
When to use laissez-Faire style?