Perched on top a 60 meter column in a bustling square on the waterfront of Barcelona sits a magnificent statue of Christopher Columbus. With one hand clutching a map and the other pointing towards the horizon, the statue is the perfect image of a great explorer leading his fleet to the new world. History has been kind to Columbus and has bestowed on him the credit of discovering the new world.
How would Christopher Columbus measure up against today’s standards for leadership excellence? After all, he failed to achieve his “mission objective” of reaching India by 10 thousand kilometers! Will our current generation of public sector leaders be treated as kindly by history?
The Commonwealth Association for Public Administration and Management (CAPAM) is a membership-based professional association of public administrators and managers. CAPAM works with and for many senior public administrators – and their task over the next few years is daunting as the sword of fiscal consolidation hangs by a thread over many public sectors. A recent OECD report suggests that OECD countries are promising to cut back on public sector employment and labor costs dramatically. The challenge has arisen both because of the revenue shortfalls, and some apparent inflation in public sector pay. It seems that about 20 out of 29 OECD countries are planning wage reductions, and 15 out of 29 staff reductions over the next few years. This is a remarkable prospect as OECD countries have not been able to achieve anything like this level of reduction in public sector employment or labor costs in the last 30 years. The situation facing many low income countries is not dissimilar.
If leadership is about getting people to want to do what you want done, then there are two big questions facing public sector leaders. First, what technical means will they draw on to improve efficiency that will have any buy-in from their staff? Driven by deep budgetary deficits in the 1980s, the concept of “New Public Management” emerged from New Zealand and drew great interest across many governments. NPM focused on government efficiency, by borrowing private sector management concepts. In its most basic form, NPM is marked by the use of quasi-contracts – between core departments and semi-autonomous agencies for service delivery and between governments and senior officials responsible for their administration. Although results of NPM did have early indications of success, over the longer term only marginal financial savings and service level improvements were achieved. What was gained in New Zealand was primarily through policy change rather than through ingenious new contracting methods. The effectiveness of NPM was even less marked in developing countries. Many staff are now deeply cynical about the potential of ever more tightly defined contractual specifications to deliver productivity – yet another set of performance indicators will not cut it. As many developing and OECD countries are once again facing enormous challenges in deficit management, what tools will they employ and will they be credible?
Second, leaders need to maintain morale. The strength of public service organizations has always been held to be based on the commitment of their employees to public service, ethical behavior and principled conduct. The historical deal was that these values were inculcated by contractual arrangements which provided heightened job security in exchange for loyalty. This bargain has long been under pressure and it is not clear how well this bargain was holding up in settings where a culture of entitlement and patronage is deeply ingrained – but most senior managers would see some remnants of this bargain in their daily negotiations with their staff. Are the last elements of this historical bargain to be swept away – with staff whose job security is diminishing returning the compliment by no longer buying in to the values of the public sector agencies that employ them?
CAPAM has no fixed position on these questions – but sees that leaders will have to find some way through. The World Bank Public Sector Management Approach should perhaps give some pointers about how the Bank will help public service leaders find that path.