Competitive Government

Injecting Competition into Service

Delivery
Jo Vanne Trivilegio
Raymund Lumangyao
Short Anecdote
1978 , Phoenix
You are going to compare the bids with your cost,
arent you?
Well bid
Hmm Well Bid too
What do you mean
Well bid too?
Well bid
Why not?
Jensen
Public-Private Competition
Public
Submitted bids 3 times but
still rejected
4 bid was very promising
but still rejected
Private
Approved
Innovations
Partnership teams
Labor-management Productivity committee
New cost accounting System
So they would know precisely how much their
services cost, per household, per month.
Installed a suggestion program
Gave employees 10 percent of the savings
generated by their suggestions- up to a
maximum of $2000.
Incentives
Gave a monthly and quarterly awards to the
best drivers.
1984
public
One person-truck with
mechanical arm on 32 cubic
yard trucks
Public beat them by 6
million dollars
private
One person-truck with
mechanical arm on 25 cubic
yard trucks
Phoenix used competition on
Garbage collection
Landfill operation
Custodial services
Parking lot management
Golf course management
Street sweeping
Street repair
Food and beverage concessions
Printing
security
Sectors that they handled better
public
Ambulance service
Street sweeping
Mantenance of median
streeps
private
All except those listed in the
other box
Jim Flanagan
Where there's competition, you get
better results, more cost
consciousness and superior service
delivery
Competion
We learn from each other - Jensen
Paradoxes of American Ideology
Attacks private monopolies so fervently but
embrace public monopolies so warmly
General Bill Creech
Service providers must Compete
They keep their cost down
Respond quickly to changing demands
Strive Mightily to satisfy their customers
Competition drives us to embrace innovation
and strive for excellence
The advantages of Competition
The most obvious advantage of
competition is greater efficiency
James Q. Wilson
Bureaucracy
Private firms deliver services more
economically than public organizations
Competition forces public(or
Private) monopolies to respond to
the needs of their customers
Public monopolies that are thrust fully
into competition have little choice but to
please their customers
Air new zealand vs Ansett competition
resulted to:
More flights
Cheaper flights
Better food
Friendlier service and virtually a zero wait
for luggage
People began to see, often for the first
time, that the central issue in safeguarding
their own interest as consumers was not, in
fact,ownership- it was competition
Competition rewards innovation,
monopoly stifles it.
The survival of the helpful
Natures incessant experimentation with
mutations enables species to evolve, adapt,
and survive despite drastic environment
change- Savas
survival of the already entrenched or the
politically powerful
Competition boost the pride and
morale of public employees
The varieties of competition
Public Vs. Private Competition
Tennessee
Department of transportation
New York Citys Sanitation Department
Postal Services
Private Vs. Private Competition
Government ask private firms to compete to
produce some public services
Load Shredding
Backing out of public provision, governments
turn services over to the private market.
Procurement
Procurement is the acquisition of goods, services
or works from an outside external source. It is
favourable that the goods, services or works are
appropriate and that they are procured at the best
possible cost to meet the needs of the purchaser in
terms of quality and quantity, time, and
location. Corporations and public bodies often
define processes intended to promote fair and
open competition for their business while
minimizing exposure to fraud and collusion.
Is another common avenue governments use to
force private companies to compete
Contracting
An agreement between two or more parties,
especially one that is written and enforceable
by law.
One of the most difficult methods a public
organization can choose, because writing and
monitoring contracts require so much skill.
lowest responsible bid
quite frankly, the low bid is usually not a
good bid. Theyve done it at a loss, or too low
a margin, and theyre going to fail. So now we
use the lowest responsible bid-Jensen
always keep at least two of its garbage
districts in public hands- so it will always have
the capacity to compete
Contracting was often rife with
corruption
How to avoid corruption in contracting
Bidding is truly competitive
The competition is based on hard information
about cost and quality of performance
The contractors are monitored carefully
A relatively non-political body is set up to
perform these task
John Donahue
The Privatization Decision
When public agencies can define precisely what
they want done:
1. Generate competition for the job
2. Evaluate a contractors performance
3. Replace or penalize those who fail to achieve
expected performance levels
Public Vs Public Competition
Contracting is difficult enough that
governments sometimes prefer to pursue the
same results by stimulating competition
between their own organizations.
CREATING COMPETITION FOR
INTERNAL GOVERNMENT SERVICES
Hale and Amanaji solution
Stocking Post-it Notes
Eliminating obsolete bureaus
Cutting costs
Incentives ( Forces Managers to Act)
Competition is the permanent force for
innovation that government normally lacks.
PUBLIC EDUCATION
A CASE STUDY
Public School is a Monopoly
American Schools
1. No performance standards
2. Little competition either within the system or
from the outside
Competition
Competition breeds accountability.....
John Clubb and Terry Moe
Politics, Markets and Americas
Schools
Factors influence student performance
1. The aptitude the student brought to
school
2. School itself
Factors influence school performance
Parenting Control
Clarity of the Schools mission
Strong Leadership
The degree of freedom and respect offered the
teachers
To develop these attributes, schools needed
autonomy from external control- from
administrators, unions, and school boards.
How do you provide autonomy and
still hold schools accountable
Move different system of accountability
Only in competition forces principals
and teachers constantly- to make the
difficult changes necessary to meet the
needs of their students.
MINESOTA EXPERIENCE
Minesota
First state to publicly debate the issue of
competition in public education.
Ideological issues and Practical realities of
competition in Public Education
Education Reforms
Let Minnesota children attend school in any
district they chose. (juniors and seniors)
Students on the verge of dropping out don't
need a lecture, the need an alternative
Perpichs Full choice program
Freeing students to attend school in any other
district as long as the receiving district had
room and the move did not harm desegration
efforts.
Kolderie
Start innovative new schools because school
choice alone wont change a closed system.
THE EQUITY ISSUE
A pure competitive market- place- an
unrestricted voucher system, for instance-
would be certain to produce inequitable
outcomes.
Because the affluent would add money to
their vouchers and buy the best education
they could afford.
It is a Mistake
Public school exist to provide education but
they also exist to bring children from all walks
of life together.
Competition revitalizes the system
MANAGING COMPETITION
Competition must be carefully structured and
managed.
Patient Dumping
Profit hospitals turning away from patients
who does not have insurance where they send
them to overcrowded hospitals.
This is a another form of inequity
Competition that is structured carefully can
produce more equitable results than service
delivery by a public monopoly.
Competition heightened the equity if
service delivery
Public agencies were, in effect, creaming
If not carefully structured, markets that
look competitive can also succumb to
monopolistic power.
Competition is here to stay, regardless of what
our government do.
COMPETE or DIE
Thank You