NPM- approaches

1) Re-inventing model/entrepreneurial government – 1992

2) Re-engineering model – 1993

3) OECD model – 1995

Re-inventing model/entrepreneurial government – 1992

Osborne and Gaebler wrote a path breaking book (published in 1993) entitled
“Reinventing Govt. : How the entrepreneurial spirit is transforming the public sector”.
This book suggested a 10-point New Public Management programme for reinventing
the government and public sector’s administrative functioning as entrepreneurial govt.
1. Catalytic govt., i.e., government which not just propagates public services
but rather catalyzes the provision of public services by promoting other
sectors like private sector, voluntary organizations etc. into action in order to
solve community problems.
2. Community owned government i.e. empower citizens and communities by
reducing bureaucratic control over them. This would involve taking certain
services and regulations out of control of bureaucracy.
3. Competition orientation i.e. promote competition between diverse providers
of goods and services. This also meant that the govt. could engage in
“steering rather than rowing”.
4. Mission driven i.e. government agencies should have clear missions which
should guide their performance rather than values guiding them(driven by
mission not value)(politics-administration dichotomy).
5. Performance oriented government i.e., governmental agencies and
departments should be focusing on output and not input and thus should
become result oriented.
6. Customer driven ie an approach which redefines citizens or users of public
administration as ‘customers’ and offers them choice.
7. Enterprising government ie., it will put energy into earning money rather
than just spending money and would attempt at generating resources.
8. Preventive focus ie., the government functioning should be anticipatory and
should aim at prevention rather than cure of administrative problems.
9. Decentralized functioning ie. The authority and control of the bureaucratic
govt. would be dispersed and government would embrace participatory
philosophy.
10. Market orientation, i.e., the government would prefer market mechanism to
bureaucratic mechanism and would look to leverage change through market
forces.
The Reinventing Model went on to become hugely popular Paradigm of modern public
administration. Almost immediately offer the propagation of this model, the American
government initiated a reform movement called NPR- National Performance Review at the
initiative of the then Vice-President Al Gore. Accordingly sweeping administrative reforms as
suggested by reinventing model were carried out in the US. Soon many other developed
countries followed suit. Eventually international funding agencies and multilateral
organizations like IMF, World bank, United Nation Development Program started
recommending the reinventing government ideas to virtually every developing country
receiving financial aid or assistance.

Osborne and Gaebler, on their part, were convinced that their model and the New Public
Management philosophy was the best remedy for the ills faced by public administration. In
their book they noted “We are lucky to be in public management at a time when truth has
been discovered.”

Suggesting thereby that NPM was the truth and everything else was the wrong way of
conducting public administration
 Re-engineering model – 1993

Hammer and Champy wrote another popular book of seminal importance in 1993 entitled
“Reengineering the Corporation: a manifesto for business revolution.” This book sought to
give revolutionary ideas about streamlining and reforming any organization, private or
public, through BPR-Business Process Reengineering.

The ‘Reengineering’ was defined in this book as:- “A fundamental rethinking and a radical
redesigning of processes in an organisation so as to achieve higher performance in terms of
quality, service and cost.”

The features or the propositions of Reengineering model of Hammer and Champy are:-

• Processes are designed to suit organisation

• Different stages of a process should be performed in their natural order so as to have
ease and speed for the client and also cost saving for the organisation.
• Simple tasks should be combined into multifunctional jobs so that: (i) customer gets
the advantage. (ii) Size of bureaucracy can be trimmed. For example.- concept of single
window clearance.
• Work should be performed where it is done the best, i.e., many processes can be
outsourced if they are performed better outside. (this is the commonality between
reinventing and Re- engineering model and is also the link between Business Process
Reengineering and BPO).
• Information & Communication Technology should be used optimally for Redesigning
the work systems.
• Flexibility in process ie. even if a process is once established as efficient and cost
effective, there should be open mindedness on reviewing it and following a ‘flexible
dynamism’ rather than ‘rigid staticness about processes. (In other words, Re-
engineering is not a single episode of fire-fighting, rather it should be a continuous
philosophy.)
The Re-engineering suggestions found great acceptance across the board from private as well
as public organizations. In public originations, they were often adopted under a related
mechanism called O & M and Work Study.

• OECD model - Christopher Hood and Walter Kickert

1. Various OECD doctrines of New Public Management were in circulation right from the
1980s, but the crystallization of the New Public Management concept happened around
mid-90s, especially in the form of effort by Christopher Hood and Walter Kickert.
Within OECD countries, UK, Canada, Australia, New Zealand , Norway and Iceland
were the most active in terms of creating New Public Management model.

Christopher Hood used the term New Public Management in 1991 to describe a
performance model in public sector which would emphasize the E3-efficiency economy
and effectiveness. He argued for professional management in public organization, using
private sector style of management

IMPACT of NPM

1. Delivery of high-quality services which citizen value.

2. Citizens are re-conceptualized as ‘active customers’ rather than ‘passive recipients’ of
govt services.

3. “Performance targets” started being set for and on behalf of the customer. These
performance targets have come to be specified in the form of rights of the interacting
 citizen when he interacts with a government agency. This concept went on to be re-
crystallized as ‘citizen charter’ i.e. a charter of right that a citizen can expect from the
government agency in the form of performance, speed and efficiency.

4) The New Public Management movement also lead to increased operational flexibility to
public manager so that they could take entrepreneurial decisions rather than waiting for
hierarchical approval for every decision which cause delay and lead to missed opportunities
for the government and harassment for the public. In this context, very popular observation
was made by Christopher Hood “let managers manage” meaning thereby that even public
administrators ought to be treated as managers and should be given operational autonomy
and flexibility. Of course, as a safeguard to this increased autonomy, the accountability was
emphasized simultaneously in the form of output orientation or evaluation of bureaucratic
performance based on clear performance targets.

5) Public personnel management, as a human support whereby managerial

capabilities will be enhanced through better personnel policies pertaining to
training, motivation, communication, etc.
6) Technological support in the form of optimized use of Information Communication
Technology so as to enhance speed, convenience, transparency, accessibility, etc.
7) Receptiveness to competition. As a result of New Public Management perspective,
governments world over became more and more receptive to privatization and
competition.

Thus, overall the New Public Management perspective created a

focus on private dominated institutional pluralism and private style
of government operations in the form of a leaner but more efficient
govt.
 Criticism of NPM
1. The foundational concepts/theories of NPM are not without criticism
2. Welfare state becomes entrepreneur state. State considers itself as a service
provider and considers citizens as customers. In developing countries, this
would mean excluding masses from services because masses can not sustain
relationship with govt in nature of user-pay.
3. Disguises private interest as public interest. NPM is corporate eliticism and
‘consultocracy’
4. NPM is based on working principles of private sector. But, private and public
sector differ in their core priorities and goals.
5. NPM is not applicable in case of emergency functions like war, disasters like
flood, earthquake, etc.
6. Some countries don’t have resource and institutional base to implement
NPM models yet, they are imposed on these countries. Thus, NPM is
promoting ‘global monoculture’
7. Robert Hughes (2003): New Public Management ignores the complexity the
socio-economic reality and there by end up operating only for the better-off
classes who can sustain the economic relationship or user pay relationship.
The public-private similarity is challenged. The moment government adopts
steering functioning and third party governance dominates, public
accountability will come into question because there is no guarantee that
the Private Player will assume public accountancy. As a result, there is
always a danger that profits are passed on to private players but
responsibility stays with the govt. The three important terms used by New
Public Management namely, efficiency, public interest and customer-
orientation are unclearly spelt and can be interpreted differently.

For e.g. - 1.efficiency is economic efficiency or socio-economic efficiency? 2.

Public interest is interest of paying public or the general public? 3. Customer
orientation or service quality- is it orientation in terms of quality of one-off
service or “service as a broad philosophy”?

[In fact, the New Public Service perspective was a response to these
possibilities and thereby emphasized on ethical issues in administration and
talked about “serving rather than steering”. In other words, arguing that
government’s role cannot be so marginalized that ethical issues of public
service start getting ignored.]

8. Patrick Dunleavy (2006):- Patrick Dunleavy in 2006 proclaimed that NPM

was dead. He argued that it is dead because post NPM paradigms have been
developed around the theme of ‘digital era governance’ (the model that he
gave). He argued that in “digital era governance”, there is digitization, i.e.,
use of ICT and holistic or joined up govt