Differences Of Public Management In The Public And Private Sector

1185 Words 5 Pages
One of the most interesting topics in today’s world is the one of the differences and similarities between the public and private sectors. Although much of the public sector tend to focus in the incompatibility of beliefs and incentives there has also been a great number of actors that have been able to transit both worlds with success.
In the last decades, the idea has been to focus on the similarities between the two worlds and create a new vision of leadership and management for both. For example, we have the New Public Management (NPM) movement (Barzelay 2001; Osborne and Gaebler 1992) that tries to align business concepts such as customer service and total quality management with public-choice theory, to create a framework that private
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Thus, according to Knott, 1993: “There are three difficulties in particular that make management a challenging undertaking: interdependence, asymmetrical information (adverse selection or moral hazard), and conflicts of interest. The presence or absence of these difficulties thus should be important determinants of the nature of the management task in different public and private settings.”
In the case of the Michigan Agency of Energy, the internal management is certainly facing those type of issues. Particularly because the way the agency was created and since is a product of the government, some of the main issues so far have to deal with asymmetrical information, conflict of interest and interdependence. For example, when MAE was created some employees thought they were send there to be laid off at some point. In addition, some managers and executives believe there is an inherence resistance to share information, particularly because this was and is a mechanism that might keep people from being
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Thus, the most important thing a private sector leader needs to know when performing a job at the public sector is to change the bottom line of the purpose of their job; and to be able to do so, they need to recognize the similarities and differences to use their experience if suitable or learn if necessary.
What is certain is that transitioning and being successful in both sectors is something very difficult and requires commitment and passion from the leader. Maybe that is why there are not too many cases to point out. However, aside from Valerie Brader, we have huge examples, such as Michael Bloomberg that was able to effectively move to the public sector and have a successful career as serving three consecutive terms as the Mayor of New York City.
In conclusion, transitioning from the private to the public sector is a very hard, challenging and even exhausting task for a leader. However, being a good leader is equally demanding at both, so for people that take that road we can affirm that a lot of the experiences, knowledge and practice are translatable. The challenge is to being able to apply those at the right moment and learn how to deal and work with the differences the public sector has to

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