Thedisparity in the level of performance between the public entities andthe private firms has been an issue of concern for many years.Different theories and models have been developed with the objectiveof facilitating reforms that can enhance performance in the publicsector and bring them to the same level of efficiency with theprivate sector. The new public management (NPM) model is one thetools that were developed to facilitate reforms in the public sector.The NPM is a management system that is founded on the assumption thatideas that are used by the private organizations to enhanceperformance can be applied in the public sector as well (Vab, 2009,p. 3). This paper will focus on the summary of the key arguments madeby different scholars about NPM the NPM’s impact on human resourcemanagement (HRM) practices, policies, and systems and challenges aswell as the gains made by the South African’s Department of PublicService and Administration (DPSA) after adopting NPM model.
NPMarguments as proposed by different scholars
Themajority of scholars believe that the NPM model is an effective tool,which can help the public sector operate at the same level ofefficiency with the private sector. NPM was a representation of thedramatic extent of how the new thinking could influence changes inthe functioning and structure of the public bureaucracies (Hood, C.1991, p. 2). Initially, the concept of NPM focused on performancemonitoring, labor discipline, and incentives, but the need has arisenfor public managers to enhance their craft in order to maximize theirperformance (Lynn, 2006, p. 27). A further development of the NPMmodel resulted in an emphasis on organizational restructuring andexternal as well as internal competition. The competition andrestructuring can be achieved through outsourcing and contracts, bothof which are guided by the concepts of benefit/cost and efficiency(Lynn, 2006, p. 107).
Theadoption of reforms in the public sector under the guidance of theNPM is not uniform across nations, since NPM is a collection ofmodels that reflect different features, but some of the may not becompatible with the model (Pollitt, 2003, p. 36). Some of the keymodels include the public sector orientation, efficiency drive, insearch of excellence, downsizing, and decentralization (Mariussen,2013, p. 62). The NPM models also emphasize on the importance oftrust and the agency relationship in the public sector. This isbecause the model brought about a shift from the managerialperspective to an economic paradigm that should be based on theprinciple-agent relations, public choice, and the cost of transaction(Bouckaert, 2012, p. 99). This implies that the public managers areexpected to act in the best interest of the public, build on trustbetween them and the citizens, and then consider economics involvedin transactions that they make on behalf of the members of thepublic.
Impactof NPM on human resource practices, policies, and systems
Organizations,both public and private consider human resources as their mostvaluable assets, since they cannot operate without employees.However, private and public organizations have different systems andpolicies regarding the management of human resources. The NPMemphasizes on the significance of boosting accountability among thepublic servants, which is the main source of difference between thepublic and the private sector HRM practices (Bach, 2000, p. 2).Accountability helps the public agencies to create a pool of managerswho focus on results and compete for resources from other governmentagencies and donors, thus enhancing efficiency in the delivery ofservices to the members of the public. In addition, NPM affects HMRpractices in the public sector by introducing the idea of targetsthat are enforced via contractual means (Bach, 2000, p. 2). Thisenforcement ensures that value is attached to all public expenses andoperations.
Moreover,the NPM emphasizes on the significance of establishing performancemonitoring systems and restructuring of the administrative systems.The administration systems of the public agencies are expected toadopt similar structures to the private sector (O’Flynn, 2007,354). However, the government has the responsibility of empoweringthe public servants in order to make them more productive, efficient,and accountable. This implies that the public organizations may notachieve an increase in their performance, unless they empower theiremployees through training and the provision of a suitable workingenvironment. Therefore, all policies, practices, and systems adoptedby the administrators should seek to empower public servants.
Gainsand challenges of the New Public Management theory to the Departmentof Public Service and Administration
Theneed for the Department of Public Service and Administration (DPSA)arose in 1994, when South Africa started the process of adoptingdemocracy at the end of apartheid. The DPSA inherited a workforcethat was characterized by racial fragmentation, inefficiency,hierarchical order, inordinately complex (Naidoo, 2015, p. 29). Thehuman resource management practices favored control andcentralization. Policy discourse on the issue of public managementsignaled a move towards the post-NPM, which emphasized on publicvalue and reforms in the management of public employees. The DPSAreleased the first White Paper on the Transformation of the PublicService in 1995 (Naidoo, 2015, p. 29). The white paper was based onthe principles of NPM theory and it established a new public servantsmanagement policy that was more flexible, open, and participatory.The new policy also included non-governmental actors and envisionedthe responsiveness of the clients.
TheDPSA benefited from the adoption of the NPM in two major ways. First,the department managed to create an environment that facilitated aconsultative decision making. For the first time in the department’shistory, the process of decision making involved both the internaland external actors in a manner that could lead to the achievement ofcommon objectives (Naidoo, 2015, p. 31). This coordination of thedecision making process was done in accordance with the support fromthe Office of the President. The NPM enhanced performance and allowedthe department to find value in the money spent on wages and thedepartment’s projects. In addition, the successful adoption of NPMincreased efficiency in inter-organizational tasks, citizen’soversight on the department’s operations.
Secondly,the department achieved an increase in the levels of accountabilityand responsibility among the public servants. This can be attributedto the fact that public servants were consulted when making decisions(Naidoo, 2015, p. 31). In addition, the increase in the openness,which is confirmed by the engagement of the citizens in over-sightingthe department`s operations, left public servants without otheroption other than being responsible and accountable. Transparency andaccountability were also achieved through the process ofrestructuring, which involved the reorganization of units andfunctions (Gumede, 2014, p. 49). The head of department had theresponsibility of monitoring performance of other players in theprocess of making decisions and implementing the department’sstrategies.
TheDPSA faced two major challenges as a result of adopting the NPM.First, a successful implementation of NPM requires a lot ofresources. In 2009, it was reported that the public managers in thedepartment were not adequately enabled to operate under uncertain andcomplex contexts (Naidoo, 2015, p. 31). The lack of adequate supplyof resources to implement an effective public management approachthat was driven by value constrained the resources that thedepartment had before the reforms were initiated. However, thischallenge can be attributed to the insufficiency of the capacitybuilding efforts that were applied prior to these reforms.
Thesecond challenge resulted from the disruption of the control that theruling party had on the public affairs. Under the old model of publicmanagement, officials and politicians from the ruling party, the ANC,had a lot of influence on the operations of the DPSA and othergovernment agencies (Naidoo, 2015, p. 37). The adoption of NPMrequired public managers to perform functions in the best interest ofthe members of the public. However, it was reported that 89 % publicmanagers who served between 2003 and 2007 felt that change ofministers could affect their job positions or tenure (Naidoo, 2015,p. 37). This implies that the national politics hampered the successof the public management reforms. The ruling party has alwaysintended to maintain control over the administration of the stateinstitutions.
Thepublic sector record poor performance as compared to the privatesector in most countries, this trend can be reversed with the help ofthe NPM model. Scholars and theorists who support the adoption of theNPM in the public sector hold that the principles, systems, andpractices that contribute towards the success of the private firmscan also be applied in the public entities. A successful adoption ofthe model leads to an increase in the performance of the publicservants, levels of accountability, responsibility, and cooperationamong the public servants. This is confirmed by the case of the DPSAin South Africa, where the NPM helped the department increaseefficiency, performance, and collaboration among public servants andbetween the department and other government agencies.
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