Recent Reforms in the United States - Essay Example

? Public Management Public Management Introduction According to findings, there have been many changes in the public and private sector for about the past three decades with regards to public management theories and changes. This is collectively known as “new communal administration,” which can be defined as a form of administrative management that is utilized in a variety of different establishments. The aim of using this viewpoint is to generate reconstruction in the communal segments for improved presentation. It is also seen as the tendency linking communal improvements that have been practiced across the world for the past years. It is understood that when there is more market orientation in the public sector, it will lead to greater cost effectiveness for most governments in the world (Armstrong 2006, p.45). This was seen to have fewer negative effects on other objectives and considerations that governments may have in considering projects and offering of services to citizens in a country. Studies reveal that the new public management philosophy is more outcome and efficiency oriented as it employs better management techniques for public budgets and other key objectives with public interest. The techniques applied may include: the application of competition such is evidenced in the private sector, public organizations through the emphasis on leadership and economic principles, and a range of other approaches. Secondly, such an approach encourages new developments via the process of splitting large bureaucracies into smaller and more fragmented ones. This can be done through the introduction of competition between different public agencies, and between public agencies against private firms. Or, it can be achieved through incentivization while basing the change purely on more economic lines. This will allow the alignment of events towards the natural capitalistic systems that already exist within the markets. Furthermore, this is one of the easiest ways to impose values and techniques on the private sector management into the public sector organization and improve service and product delivery at the very same time. Incentivization theme On the other hand, it is important to look at one of the themes applied in public reform in forming the basis of furthering the paper discussion. Incentivization is a process that facilitates the shifting away from the involvement of managers and staffs rewarding performance in terms of a diffusing public or professional ethos and instead shifting towards a greater emphasis on financial-based and specific performance incentives (Lane 2000, p.54). This, in terms of the public sector, implied that there is a movement involving a down group and at the same time a down grid with relation to the existing cultural theories. It is said that the impact of this particular involvement has been marked by many professional groups that then chose to focus upon this as a means of encouraging an improved level of performance. Studies show that ‘incentivization’ mechanisms show the highest percentage of emerging the ‘new public management’ developments. This is evident because of an increased diversity involving public agencies in several countries to include: the United Kingdom, Australia, and the United States. However, the expectations that performance related pay will improve performance of agency staffs has oftentimes been viewed as impossible by many scholars/researchers. Recent reforms in the United States Suggestions from an array of studies show that, the United States has engaged in various reforms within the past several decades; from healthcare to taxes and other sectors of the economy and society. Regarding the incentivization theme, it has been found that the current United States corporate tax codes have had a large impact of incentivizing companies to relocate their business operations to other countries; thereby making these companies more multinational. This has been viewed as a technique of providing employment that will have only been in the United States to other locations. This comes in the wake of criticism by many policymakers and the president himself concerning the outsourcing of jobs abroad by the American based multinational organizations. The criticism pointed out that such move reduces job opportunities for American workers and then hurts the United States competitive advantage in the global economy. It has been found that the influence of the American based multinational on the United States jobs and tax revenues is an increasing concern for the policymakers and the public in the United States. ‘Tax incentivizing’, as projected in the Obama`s tax suggestions, is founded on the domestic obligation and the means by which the federal government of the United States can seek to incentivize keeping jobs within the domestic economy. This is achieved through the raising of a portion of the tax by removing the overseas tax advantages of multinationals and then creating a permanent tax credit based on domestic research and/or innovation. Through the tax reforms, some measures were put forward, which had a limiting effect on offshore loopholes and tax avoidance techniques (Goh 2012, p. 35). This facilitated the deduction of expense from payments on profits earned in foreign countries and the use of tax credits to offset taxes paid to foreign authorities. This move enables the fluctuation of revenue from high to low levy republics through the transmission of expenditures. This is a move that is expected to raise about two hundred million dollars of tax revenue in around a ten year period of time. In this regard, through ‘tax deferral’, there are concerns that arise concerning the duty restructuring that is taking place within the United States economy. Moreover, such an approach illustrated the fact that the United States levies both extraneous and local remunerations on United States transnational businesses. In responses to this, firms were previously making timed payments of taxes concerning their foreign profits based on how the parent company could most readily leverage deductions and promote an understanding of losses. In some cases, parent companies may be organized through subsidiaries; here the company may be separately incorporated in a foreign country. In this case, the secondary proceeds are not taxed until such a time they get compensated to the parent corporation in the United States. In addition, parent companies pay the taxes as soon as they receive them as dividends, royalties paid by subsidiaries, and/or interests. It occurs that when payments are delayed, they can become tax deferrals which gets paid once the foreign income is sent back to the United Sates and the government then imposes what is called residual tax. The reforms put forward lately through the Obama administration defers the deductions that the United States based firms take on foreign income until the tax is paid effectively on that income in the United Sates. This has been as a move that raises the cost of delaying such tax payments. However, some studies suggest that, the increased tax burden will force the United States multinationals to consider selling their foreign subsidiaries to foreign firms in countries that are not subject to foreign income. This calls for the lowering of the United States tax rates to about twenty-five percent and even less so that it can be possible to compete favorably with other countries at the same level, as such states have been dropped their particular commercial tariff amounts for some years. Among other possible reforms, it is clear that, when trade barriers against key partners like china will be more effective at boosting the exports, jobs and in essence close fiscal deficits. The reforms also involve issues like value added taxes that are levied in every stage of production by basing these on the value added to a product. In such manner, the similar way in which the public sector seeks to increase revenues based upon a level of incentivization cannot be understood as completely dissimilar to the means by which the private sector seeks to maximize profitability. How performance management in the public sector has changed under contemporary managerial reforms Studies show that for more than a decade a set of management techniques and practices associated with markets and private for profit sectors for reforming administration and management in government concerning many countries have pushed for the use and application of more contemporary forms of management. Various factors that drive these reforms in the public sector concerning performance management are discussed in the below sections as a means of determining the level or extend of reform. There has been burden concerning alteration in the communal subdivision and mainly supervision. To begin with, there are economic and fiscal pressures facing governments in most countries since the 1970s. Studies show that a fiscal stress causes massive public sector deficits, growing indebtedness, and external trade imbalances have led to the restructuring of the, public sector and especially the management. This has been the force behind the rethinking, leading to the reshaping of the roles of the government, and this has made issues like privatization and contracting gained prominence as the ways for controlling monetary deficits by restructuring the public sector down to the management. In such a manner, it can become evident to the researcher that the breakdown in understanding that exists between these theoretical approaches is oftentimes not the fault of purely public or private interests at play but oftentimes the result of the fact that a strong culture develops within these sectors that constrains the approaches to key issues with which the entity must engage. In addition, the resultant competition are some of the forces that push the public sector in most countries to reshape by keeping with the pace of emerging global economies driven by technological changes in the information and technology industry. These have greatly influenced the public management areas by changing the conventional ideas about how things should be run in the public sector. There has been a marked proliferation of management ideas that are generated, packaged, and marketed by multinational management consultants acting as advisors on reform to many governments around the world. The other driving factor is the communal philosophies and cumulative approaches regarding the futility and ineptitudes of conveying communal amenities through official legislative provisions. This calls for the need to seek alternatives because the old administrative models have been viewed as too slow and driven by rules rather than performance (Hoque, 2008). This combines to make them both inefficient and unresponsive to the stakeholder’s needs. Through information technology, improvements in routine supervision, policymaking assistances and supervision and engagement with subsidiary needs it is possible to provide a much higher level of change and efficiency to all involved. For clarity, some theories have been put forward to give some explanation concerning these determinants. Studies indicate that the rise of the new public management doctrine is associated with the rising intellectual disenchantment with the growth and role of government and the shift towards privatization (Hood 2005, p. 5). Through this theory, criticism has been thrown at the bureaucratic model because it lacks cost-consciousness due to the fact that there are weak links between outputs and costs for achieving these metrics. It is also evident that the rewards system in the public sector has few orientations capable for improving performance, thus no incentive for the stakeholders exists to control costs. It is also noteworthy to see that within this theoretical approach there exists much waste and over expenditure concerning public sector mangers; which focus more on delivery other than productivity and efficiency. Likewise, a second component is necessarily the understanding that the chief mediator model provides. Within this model, the degree to which miscommunication and non-linear alignment of key needs is evidenced is necessarily greatly reduced. In this way, the approach argues that the community needs of the officeholders and stakeholders define the greatest needs; thereby constraining the individual egos that might otherwise motivate actions (Kaplan, 2006). In this sense, there is insufficient information, and the incompleteness of contracts of employment, together with many problems of behavior monitoring that fail to deliver outlines for motivating mediators to be more responsible. It was realized along the same lines that the public sector performs poorly because the concerned officials pursue their own interests while neglecting the public interests. Challenges concerning measuring of performance in public organizations and there implications However, the fact of the matter is that performance measurement has many challenges which will be discussed within this final portion of the analysis. Many scholars have noted that an existing or developing culture within an organization has a profound impact upon the extent and level to which performance measurements can be attained (Kernaghan 2000, p. 25). Thus, the culture and norms about performance measurement systems are still low and present challenges to most civil servants. The other aspect is with regards to the lack of knowledge in performance measurement systems; thus, it becomes a problem to set efficient and effective indicators relevant to the organizational goals. Finally, it must be understood that there are some situations where a complete lack of coordination between work units and stakeholders exists; thereby causing a situation in which it is nearly impossible for performance systems to integrate with the strategies which have hitherto been lain out. In such a way, there is a complete absence of the means of instituting reward punishment systems that both motivate and demotivate the employees in achieving the best results. In addition, the limiting of priority of information for setting the targets means that there is an absence of data related to the initial performance results in previous years. This makes it difficult for establishments in influencing the predictable routine objectives. Finally, there is lack of policies that help in regulating the performance base compensation schemes; this makes it difficult to set targets. Conclusion In short, the conclusion that can definitively be drawn is with regards to the fact that many of the public sector metrics and theories that help to promote profitability are noticeably absent from the process of governmental approaches to management and efficiency management. Although it can be stated that this exhibits a key weakness on the part of governmental agencies around the globe to experience further levels of profitability and serve the interests of the stakeholders to a more complete degree, it should also be noted that not all of the theories which have herein been engaged can or should be utilized systemically across both sectors. This is of course due to the fact that the governmental structures require a unique approach and speak to key needs of society in a way that the solely profit driven motives of the private sector are wholly incapable of providing. As such, rather than categorically stating that the differential that exists between the public and the private sector is evidence of a fundamental breakdown in efficiency of the public sector, it should be noted that some level of differentiation is required in order to provide responses to the key mission goals and objectives that necessarily exist between the two. However, rather than taking this to mean that all levels of dissimilarilty between public and private sectors is readily understood and defensible, the reader should understand that although differences in mission goals and objectives do exist, it is nonetheless necessary for all models of management to engage in a thorough and complete understanding of categorical and effective theoretical approaches. References Armstrong, M 2006, Strategic Human Resource Management, London, UK: Kogan Page. Goh, S 2012, Making performance measurement systems more effective in public sector organizations, Measuring Business Excellence, (16): 31-42. Hood, C 2005, ‘A Public Management for All Seasons’. Public Administration, 69(1): 3- 9. Hoque, Z 2008, Measuring and reporting public sector outputs/outcomes: Exploratory Evidence from Australia, International Journal of Public Sector Management, (21)5: 468-493. Kaplan, S 2006, The Balanced Scorecard, Translating Strategy into action, New York, NY: Harvard Business Review Press. Kernaghan, K 2000, ‘The post-bureaucratic organization and public service values’, International Review of Administrative Sciences, 66 (1): 21-44. Lane, J 2000, New Public Management, London: Routledge. Read More