Is It True to Say That Managing in the Public, Private or Voluntary Sectors Is Essentially the Same - Essay Example

?To what extent is it true to say that managing in the public, private or voluntary sectors is essentially the same? Like most other disciplines in the social sciences, 'management' is difficult to define. The Oxford Dictionary says that 'manage' means to handle, to conduct, to control and to take charge of something (Gadkari, 1997). Management is about mobilising resources and people to accomplish a certain result (Montana & Charnov, 2008). Management involves the setting up of systems and structures to ensure that people are delegated to complete a task of combining resources to attain a given end (Witzel, 2004). This therefore means that management of an entity would have to set up a system of delegation and working that would enable individuals within an organisation to extract resources from the society, process it and then sell it to members of the society. Most organisations are either publicly or privately owned (Gadkari, 1997). However, there is a growing trend of social entrepreneurship. 'Social entrepreneurship' is a term linked to the activists, NGOs, policymakers, international institutions and corporations which address a range of social issues in innovative and creative ways (Nicholls, 2006). Management techniques are adapted to be able to give all organisations guidelines and codes of best practices to apply in the setting up and running of successful businesses (Montana & Charnov, 2008). Management encourages the people with power and authority in organisations to set up permanent systems and structures as well as periodic targets and ends and ensure that they are attained through leading, co-ordination, monitoring and evaluation (Witzel, 2004). In this sense, management gives sufficient tools, techniques and guidance that can enable people in all forms of organisations to attain results. This means that management just gives people in authority the right and ideal standards and techniques to attain the standards and targets they set. This therefore means that management in public, private and voluntary organisations are essentially the same. However, Holley et al (2009) state that management in public, private and voluntary organisations are different because of the inherent nature of these forms of business. First of all, the public sector is set up by the government to provide services to the public at little or no costs. On the other hand, private businesses are set up to render a service to the society with a view of maximizing the profits of the owners. Voluntary organisations on the other hand, are set up by non-governmental entities to provide services to the public at little or no costs and are usually funded by philanthropic efforts. The structures of authority and establishment of these entities create inherent differences in these organisations that makes it inappropriate for a manager to use the management system that works for one class of entity on another. This is because the government's requirement from public sector organisations are not the same as those used by the shareholders of private companies. Also, the requirements of sponsors of voluntary organisations are very different from these two. This therefore makes it necessary for different management systems to be used in each of these cases. Holley et al (2009) state that monopolistic conditions often exist in the public sector. This is because few people provide the same service that public sectors do. This therefore means that the requirements and desires of the public sector are not very demanding. On the other hand, the private sector is very competitive. This is because an average business seeks to gain a larger market share in the face of competition from other businesses that provide similar goods and services to members of the public. This therefore means that a private sector organisation needs to remain competitive to survive into the foreseeable future. Voluntary organisations are also specialised in their nature and do not often face competition directly (Courtney, 2002). However, their supreme goal is to change things in the society, thus the emphasis on management in such organisations comes with high levels of laxity in relation to the private sector. In this sense, it is much more closer to public sectors than public sector organisations. The public sector has numerous stakeholders and there are high degrees of bargaining in their work (Holley et al, 2009). Public sector organisations need to satisfy the government in power by making their policy felt amongst the masses. They also need to satisfy the members of various stakeholder groups around the country and not necessarily seek profits. In this sense, a management system that promotes profits is not as important as one that seeks to satisfy the best interest of the government and other stakeholder groups. Non-profit organisations on the other hand, have to account to their sponsors and are assessed on how much change they attain in the society. This, traditionally does not require management but social skills (Smith et al, 1995). Another issue that calls for different management systems for private and public sectors is the fact that employee orientation in the public and private sectors are different (Vicoda-Gadot, 2000). This is because there is empirical evidence that the conceptions of workers in the private sector and public sector differ in terms of work centrality, obligation to norm, expressive orientation and interpersonal relationships. This therefore makes it necessary for different systems and structures of motivation and monitoring to be employed through the principles of management in each of these types of business. However, in recent times, most scholars have argued that the public sector needs to employ the management systems of private sector organisations (Schilder, 2000). This is because private organisations are more cost effective than public sectors organisations (Farazmand, 2001). A school of thought explains that the private sector has developed the most efficient management system because they have tried and tested them over and over again. This therefore makes it imperative for the public sector to adopt these systems and structures. This argument has led to the development of 'New Public Management' which changes the focus of public sector into a system that is much closer to that of the private sector (Ferlie, 2006). This is evident in the fact that public sector organisations are shifting from policy and constitutional advice to the operational and strategic management and value for money. Secondly, organisations are moving from a vertically integrated organisations to more decentralised units with some autonomy in purchasing and management of contracts. The user focus is also changing from an inward one to a more outward view of rendering service. Also, the modest administrative role played by public sector organisations is fast changing to a professional and managerial hybrid. Finally, the low change orientation of the public sector to a higher change orientation. On the other hand of the spectrum, private sector organisations are being encouraged more and more to operate in a socially responsible way. The United Nations requires businesses to be environmentally conscious, socially conscious and is well governed with respect to all the stakeholders who affect and are affected by their operations (Banerjee, 2010). This therefore means that a business should not seek to make money for the shareholders but also to respect the environmental, social and governance needs of elements of the wider society that they affect in its operations. The need for ethics and corporate social responsibilities makes it necessary for public sector organisations to use some elements of the public sector in their management systems. This therefore leads to a management system that is much more closer to the public sector. This implies that management principles and practices are much more similar in the private sector and public sector. By extension, this similarity incorporates the ideal management standards to be used by members of voluntary organisations. In spite of this new trend, the inherent differences in the ownership and structures of these three organisations makes it quite difficult for these organisations to use the same structures. Thus it is commendable for a manager in each organisation to identify the management systems relevant to his organisation but be quick to learn where there is the need for the application of standards and systems from another sector that is more specialised in a given aspect. In conclusion, management is a science that has universal systems that can be applied to all types of organisations. However, differences in the ownership, competition and employee orientation. In recent times though, the public sector is fast adopting the management systems and structures used by private sector organisations. References Banerjee, Subhabrata Bobby (2010) Corporate Social Responsibility: The Good, Bad & Ugly Edward Elgar Publishing Courtney, Roger (2002) Strategic Management in Voluntary Non-profit Organizations London: Routledge Farazmand, Ali (2001) Handbook of Comparative & Development in Public Administration CRC Press Ferlie, Ewan (2006) “Quasi-Strategy Strategic Management in Contemporary Public Sector” Handbook of Strategy & Management eds Pettigren, Andrew, Howard Thomas & Wittington Richard London: SAGE Publication Gadkari, Singh S. (1997) Office Management for Public Administration: Principles & Techniques New Delhi: New Age International Publishers Holley, William, H; Jennings, Kenneth M. & Wolters, Roger, S (2009) The Labor Relations Process Mason, OH: Cengage. Montana, Patrick, J & Charnov Bruce, H. (2008) Management Barrons Educational Series Nicholls, A. (2006) Social Entrepreneurship: New Models of Sustainable Social Change Oxford University Press Schilder, Ard (2000) Government Failures & Institutions in Public Policy Evaluation Amsterdam: VanCorcum Publishers Smith, Justin Davis; Rochester, Colin & Hedley Rodney (1995) An Introduction to Voluntary Sector London: Routledge Vigoda-Gadot, Eran (2000) Public Administration: An Interdisciplinary Critical Analysis CRC Press Witzel, Morgen (2004) Management: The Basics London: Routledge Taylor & Francis Read More