This is New Public Management
Since the 1980's the public sector in many countries applied a fundamentally new way of working, which we now call New Public Management. This is an approach that is more efficient, that is based on private sector principles, where competition is used to drive efficiencies, and where citizens are seen as customers. New Public Management (NPM), is based around the concepts of private sector business and management models. It focuses on citizens as the recipients of the services, mirroring the customers as a consumer who has choice. Its goal is efficiency and good service delivery. It can be recognised by standardised service delivery models, centralised financial control, value for money, increasing efficiency through identifying and setting targets and central monitoring of performance. Control is enabled by legislation and top down design. Performance is assessed with audits, benchmarks, feedback of measures, and performance evaluations. More recently, NPM is the ideology of increasing efficiency through the use of digital service design.
At a policy level the mechanisms of New Public Management are in legislation, guidance, policies, government and political ruling, the definition of measures, and the allocation of funding. At an organisation level, this is based on measuring activity and compliance to rules, documenting actions, the creation of fixed job roles, the standardisation of work through service delivery, the design of individual specialist departments, the minimising of risk, and the use of digital technology as a primary communication mechanism. And it has now become an endemic way of thinking by most people that work in the public sector. There is an assumption that NPM can improve itself based on adjusting to customer need.
Regardless of what the ideology we individually think about how appropriate this is, we now have plenty of evidence that demonstrates its ability to create a better, leaner public sector. The simple answer, is that it has failed in all this, except in a group of highly centralised transactional services - like renewing a passport. This failure is despite the huge amounts that have been spent on improving current services - we are still in a downward spiral, which is the hallmark of a broken system:
- Demand for services and health is rising. This demand is in part, self generating from the failure to deal with the real issues.
- Services are increasingly stretched as austerity creates irrational short term decisions.
- Prevention activities have been almost eliminated, driving up demand from escalating problems.
- Costs rise because the service themselves have to adapt to complexity that they are not designed to deal with.
- Citizens are less satisfied with their lives and their communities. Poverty and lack of coherence fragments health into responding to crisis.
One of the fundamental issues that we have in place today in the design of our public services is a focus on reductionism. Reductionism is characterised by the splitting up of end to end processes into discrete services and departments, applying individual targets that drive sub-optimisation, managers that manage numbers, based on the assumption that value created can be quantified. This paradigm believes supporting people and complex public health services can be designed as though it behaves like a mechanistic model of individual transactional services. The roles of people working in those services are designed into fit standard expert processes. As a consequence of focusing on short term activities and reducing visible costs, we have created the perverse behaviour where demand and costs are rising, due to self inflicted causes.
Over the past two decades, a group of us have been actively developing and applying a fundamentally different approach using an alternative design paradigm, and the outcomes demonstrate that these alternatives achieve a coherent and very different effective public sector.
At a policy level the mechanisms of New Public Management are in legislation, guidance, policies, government and political ruling, the definition of measures, and the allocation of funding. At an organisation level, this is based on measuring activity and compliance to rules, documenting actions, the creation of fixed job roles, the standardisation of work through service delivery, the design of individual specialist departments, the minimising of risk, and the use of digital technology as a primary communication mechanism. And it has now become an endemic way of thinking by most people that work in the public sector. There is an assumption that NPM can improve itself based on adjusting to customer need.
Regardless of what the ideology we individually think about how appropriate this is, we now have plenty of evidence that demonstrates its ability to create a better, leaner public sector. The simple answer, is that it has failed in all this, except in a group of highly centralised transactional services - like renewing a passport. This failure is despite the huge amounts that have been spent on improving current services - we are still in a downward spiral, which is the hallmark of a broken system:
- Demand for services and health is rising. This demand is in part, self generating from the failure to deal with the real issues.
- Services are increasingly stretched as austerity creates irrational short term decisions.
- Prevention activities have been almost eliminated, driving up demand from escalating problems.
- Costs rise because the service themselves have to adapt to complexity that they are not designed to deal with.
- Citizens are less satisfied with their lives and their communities. Poverty and lack of coherence fragments health into responding to crisis.
One of the fundamental issues that we have in place today in the design of our public services is a focus on reductionism. Reductionism is characterised by the splitting up of end to end processes into discrete services and departments, applying individual targets that drive sub-optimisation, managers that manage numbers, based on the assumption that value created can be quantified. This paradigm believes supporting people and complex public health services can be designed as though it behaves like a mechanistic model of individual transactional services. The roles of people working in those services are designed into fit standard expert processes. As a consequence of focusing on short term activities and reducing visible costs, we have created the perverse behaviour where demand and costs are rising, due to self inflicted causes.
Over the past two decades, a group of us have been actively developing and applying a fundamentally different approach using an alternative design paradigm, and the outcomes demonstrate that these alternatives achieve a coherent and very different effective public sector.
This video is a fascinating discussion with Caroline Slocock, who worked for Gordon Brown as Chancellor and Margaret Thatcher as Prime Minister. She was the first female Private Secretary at No 10, working alongside Thatcher when she began New Public Management - she was there and watched it happen!
