New public management

Definition

New public management (NPM) is a management philosophy used by governments since the 1980s to improve public sector efficiency and effectiveness through market-oriented reforms. It emphasizes performance measurement, accountability, and customer satisfaction while introducing private sector practices into public administration. This approach seeks to enhance service delivery and reduce bureaucratic inefficiencies, but it has faced criticism for prioritizing efficiency over equity and public values.

5 Must Know Facts For Your Next Test

1. NPM emerged in response to criticisms of traditional bureaucratic models, focusing on increasing efficiency through competition and innovation.
2. Key principles of NPM include decentralization, focus on outputs and outcomes rather than processes, and the adoption of business-like practices.
3. The implementation of NPM often involves the use of performance indicators and benchmarks to evaluate the effectiveness of public services.
4. While NPM has improved some aspects of service delivery, critics argue it can lead to a neglect of social equity and undermine the public interest.
5. Many governments around the world have adopted NPM approaches, influencing various sectors including health care, education, and social services.

Review Questions

• How does new public management differ from traditional bureaucratic approaches in public administration?
  • New public management differs from traditional bureaucratic approaches by emphasizing efficiency, performance measurement, and customer satisfaction rather than strict adherence to rules and procedures. NPM promotes decentralized decision-making and encourages competition among service providers. In contrast, traditional bureaucracy relies on hierarchical structures and a focus on process over results, which can lead to inefficiencies and a lack of responsiveness to citizens' needs.
• What are some key criticisms of new public management, particularly in relation to its impact on public values?
  • Key criticisms of new public management include its tendency to prioritize efficiency over equity, potentially leading to disparities in service quality. Critics argue that NPM's focus on performance metrics can encourage a narrow view of success, undermining broader public values such as accessibility and social justice. Furthermore, the introduction of market-oriented practices may compromise the core mission of public services by treating citizens as customers rather than stakeholders in a democratic society.
• Evaluate the overall effectiveness of new public management in improving public sector outcomes while considering its limitations.
  • The overall effectiveness of new public management in improving public sector outcomes can be seen in increased efficiency, innovation, and responsiveness to citizen demands. However, its limitations are significant; while NPM has driven some positive changes, it has also led to unintended consequences such as reduced equity and diminished trust in government institutions. Balancing efficiency with fairness remains a critical challenge for policymakers as they implement NPM strategies while striving to uphold public values and ensure that all citizens receive fair treatment.

Related terms

Performance Measurement: A systematic process of assessing the efficiency and effectiveness of public services, often using quantitative metrics.

Accountability:

The obligation of public officials to report on the use of public resources and to justify their decisions and actions to the public.

Marketization: The process of introducing market-like mechanisms into public services, including competition, outsourcing, and privatization.