QUESTION:

“IN YOUR OWN WORDS, WHAT IS NEW PUBLIC MANAGEMENT (NPM)? EXPLAIN
FIVE (5) OF NPM BASIC CHARACTERISTICS”

What is New Public Management (NPM) ?

New Public Management or NPM is an approach that seeks to build an

administration by implementing flexibility, transparency, less bureaucratic, minimum
control of government, depoliticize or decentralization and most importantly it was
the beginning of public administration to adapt the private element in public
administration. This policy is a reform and transformation from a traditional and
bureaucratic public administration policy to a more efficient, effective and modern
public sector management technique.

Explain five (5) of NPM basic characteristics ?

There are 5 basic characteristics in New Public Management (NPM). The first
one is, value. NPM emphasizes the efficient management of public organizations in
providing high quality services to the people. Hence, it stresses the need to inculcate
entrepreneurial skills upon the administrative leaders. Second is, empowerment of
citizens. NPM views individuals as a customer. It focuses on customer satisfaction
and meet customer needs. Customers in this sense including other agencies, private
organisations and internal customers from the same public organisations. The third
is, organisational structure in NPM. In NPM business administration was regarded as
the right model for public administration. NPM managing public sector in a
competitive and firm-like environment. NPM advocates the incorporation of the
established principles of private sector organization and market competition in the
public sector. It believes that the general management process, principles, skills and
techniques are the same for both private and public organization. Thus, the NPM
emphasizes the business management perspectives in the functioning of
government organization. The NPM aims at achieving the 3Es (economy, efficiency,
effectiveness). Next characteristics is, budgeting. NPM budgeting focuses on the
production of services (outputs) and results (outcomes). It encourages agencies and
administrative units to generate their own revenues such as charging user with
certain amount of fees. Allocations of public budget must be based on performance,
value creation for customers and the public and national interest. Lack of output
needs to be investigated whether government investment into the function should
lead towards its termination, privatization or transfer to other levels or units of
government. The last one is , decision making in NPM. Decision making should be
decentralised. It should be based on costumer response, level of performance, and
cost effectiveness. In addition, any decision made must be cost-conscious.