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date: 29 June 2017

The New Public Management and Public Management Studies

Summary and Keywords

The New Public Management (NPM) is a major and sustained development in the management of public services that is evident in some major countries. Its rise is often linked to broader changes in the underlying political economy, apparent since the 1980s, associated with the rise of the New Right as both a political and an intellectual movement. The NPM reform narrative includes the growth of markets and quasi-markets within public services, empowerment of management, and active performance measurement and management. NPM draws its intellectual inspiration from public choice theory and agency theory.

NPM’s impact varies internationally, and not all countries have converged on the NPM model. The United Kingdom is often taken as an extreme case, but New Zealand and Sweden have also been highlighted as “high-impact” NPM states, while the United States has been assessed as a “medium impact” state. There has been a lively debate over whether NPM reforms have had beneficial effects or not. NPM’s claimed advantages include greater value for money and restoring governability to an overextended public sector. Its claimed disadvantages include an excessive concern for efficiency (rather than democratic accountability) and an entrenchment of agency-specific “silo thinking.”

Much academic writing on the NPM has been political science based. However, different traditions of management scholarship have also usefully contributed in four distinct areas: (a) assessing and explaining performance levels in public agencies, (b) exploring their strategic management, (c) managing public services professionals, and (d) developing a more critical perspective on the resistance by staff to NPM reforms.

While NPM scholarship is now a mature field, further work is needed in three areas to assess: (a) whether public agencies have moved to a post-NPM paradigm or whether NPM principles are still embedded even if dysfunctionally so, (b) the pattern of the international diffusion of NPM reforms and the characterization of the management knowledge system involved, and (c) NPM’s effects on professional staff working in public agencies and whether such staff incorporate, adapt, or resist NPM reforms.

Keywords: New Public Management, public services management, public choice theory, marketization, managerialization, performance management, executive agencies, corporate governance, NPM


The decade of the 1980s witnessed major changes in the management of public services in various countries, including the extreme cases of the United Kingdom (Hood, 1991), New Zealand (Boston, Martin, Pallot, & Walsh, 1996), and Sweden (Foss Hansen, 2013). These reforms embody the New Public Management (NPM) movement and involve a bundle of radical changes, including privatization and contracting out, marketization of services still inside the public sector, and stronger performance management and manageralization. A typical NPM governance mode is a markets-and-management mix combining more competition among public services agencies with stronger line management within them. In central government, ministries downsize and export operational functions into newly autonomized “executive agencies” (Pollitt, Talbot, Caulfield, & Smullen, 2004), and then performance managed from above through contracts with their ministerial “owner.”

NPM reforms had various objectives, political as well as technical. They tried to shift public organizations away from the old, rule-bound Weberian form, to scale down the large public sectors that had grown up since the 1940s (along with associated high taxation levels), reduce the power of over mighty producers (both trade unions and public services professionals), and create more “businesslike” public services organizations. Government was supposed to become smaller, more entrepreneurial (Osborne & Gaebler, 1992) and to produce more public value (Moore, 1995) from limited resources. The reformed public agencies should seek to achieve high performance levels: “performance” is an important NPM signifier rhetorically, as is the word “entrepreneurial.” The old concern with the quality of the civil service’s policymaking competence was eclipsed by a managerial emphasis on operational “delivery” (another key NPM word). These NPM reforms challenged the traditional public agencies. There is a debate about whether the old Weberian forms will in the end prove resilient (Meier & Hill, 2005) because they remain technically efficient or whether more “entrepreneurial” public agencies are now diffusing rapidly (Osborne & Gaebler, 1992).

Given their political objectives, NPM reforms reflect wider shifts in the macro political economy in the 1980s. The New Right administrations of the 1980s, led by influential political leaders, such as Mrs. Thatcher in the United Kingdom (elected in 1979) and Ronald Reagan in the United States (1980), put “shrinking government”—and reduced taxation—firmly on the political agenda. NPM reforms express this important shift within the more concrete domain of the organization of the state.

There is strong international variation, and not all countries have gone down the NPM route (e.g., France and Germany remain largely NPM averse; Pollitt & Bouckaert, 2011). Nevertheless, some high-impact NPM jurisdictions are apparent (e.g., the United Kingdom, New Zealand, Sweden, and the state of Alberta in Canada). International donor agencies have also diffused NPM reforms to developing countries by imposing conditions on their aid packages, as they see NPM reforms as likely to promote transparency and good governance. So reforming NPM is a topic of widespread international interest.

Much of the NPM literature comes from political science, often exploring processes at the macro level of the nation-state. But the discipline of public management has also made a contribution to the literature, notably at the meso level of the agency. As this article appears in a management research encyclopedia it will finally review some key papers in various strands of the public management literature—both mainstream and more critical—and explore what the public management academic community has analyzed NPM reforms.

What is the New Public Management?

Early academic writing sought to elucidate the emergent phenomenon of New Public Management (NPM) already becoming evident in the public policy world. In the United Kingdom, the first major NPM-oriented public management reforms appeared in the early 1980s; for example, the Griffiths Report (1983) introduced general management into the United Kingdom’s National Health Service (NHS), replacing the old system of consensus management and facilitative administration, which critics argued protected traditional professional dominance (Freidson, 1970).

Political scientists engaged in helpful sense making. Hood (1991) provided an influential definition of the seven core features of NPM reforms, namely, (a) “hands on” professional management, (b) explicit standards and measures of performance, (c) greater stress on output-based controls (since results now matter more than process), (d) a disaggregation of units in the public sector, (e) more competition within the public sector itself, (f) more private-sector-style management practice (including “flexible” human resource management), and (g) the pursuit of efficiency and “doing more with less.” Behind these doctrines lay rising political and societal values that emphasized efficiency and productivity, more so than traditional notions of democratic accountability and due process.

The “3 Ms” Heuristic and Some U.K. Examples

A 3M model elaborated here represents an alternative heuristic that vividly outlines key features of the NPM. The first M stands for markets, including not only straightforward privatization of the nationalized industries but also the construction of new “quasi-markets” inside core services remaining inside the public sector.

A good example of a quasi-market are changes in the NHS introduced in 1990 (Ferlie, Ashburner, Fitzgerald, & Pettigrew, 1996). A traditional line management hierarchy from the Department of Health down to individual hospitals gave way to a split between new organizational forms of purchasers and providers, who began to relate to each other based on a contract instead of a hierarchy. The idea was that purchasers would apply pressure on providers to improve the quality of services and reduce waiting times. They could in the last resort threaten to take contracts away from underperforming providers.

On the provider side, previously directly managed NHS hospitals converted to so-called NHS trusts that had enhanced operational autonomy and better developed internal management capacity. There was a prospect in principle of market entry by independent healthcare providers who could win contracts from the purchasers. In practice, however, there was little market entry or exit in the first quasi-market period (1990 to 1997), reflecting the fears about system instability at Department of Health level (Le Grand, Mays, & Mulligan, 1998). The “managed market” ended up being more managed than market. Later legislation (2012) stimulated greater market entry from alternative healthcare providers in such areas as community health services.

The second M stands for management, an occupational group typically empowered by NPM reforms against strong public sector trade unions and public services professionals. “Management must manage” was a key NPM slogan. The new public managers should within NPM doctrine focus actively on managing major change instead of mere bureaucratic routine, pushing through policies desired by the political center against local resistance (e.g., progressing long-standing hospital closures; Pettigrew, Ferlie, & McKee, 1992). In the higher education sector, vice chancellors were encouraged to act more as chief executives (Jarrett, 1985): whether an individual vice chancellor chooses to self-describe as the “chief executive” is a revealing linguistic choice. The pay of vice chancellors rose considerably; yet they also faced more performance pressures, job insecurity, and turnover.

In addition, management capacity in public agencies would be developed through corporate governance reforms to enhance the role of the board. In the higher education sector, these reforms provoked major change at the corporate governance level in newer universities, where the academic profession was more weakly represented (Knight, 2002) and managerial principles were already firmly established. The old large, representative (and critics would argue ineffective) boards (known as councils in the higher education sector) gave way to smaller boards, with nonexecutives appointed from outside and chosen for relevant business expertise (e.g., in finance, real estate, or accounting; Lambert, 2003). NPM doctrine also suggested that these new boards might counterbalance what might otherwise have become overly dominant vice chancellors. Although (or even because) they came from outside the academic profession, these new council members could act as “principals,” set and monitor performance objectives, and keep their “agents”—that is, the vice chancellors—in check. Buckland (2004) has argued that these private-sector-based models of corporate governance (Lambert, 2003) were inappropriately imported into university settings, which should instead retain a wider social mission, rightly relating to many different stakeholders.

NPM reforms were significant in central government too. U.K. central ministries retreated into a smaller strategic core, supposedly “steering not rowing.” They exported many operational functions to newly created executive agencies (the so-called Next Steps; Ibbs Report, 1988; Chapman, 1988; Pollitt et al., 2004) under framework agreements specifying their objectives. For example, the Driver and Vehicle Licensing Agency in Swansea maintains national registers of all U.K. drivers (45 million) and vehicles (38 million). It employed about 6,000 staff as of 2014 and operates as an executive agency of the Department of Transport. The idea was that these “monotonic” agencies would be good at doing one routine thing many times (Pollitt et al., 2004) and thus ramp up productivity levels.

Elston (2012) tracked the rapid diffusion of the Next Steps agencies over a decade, up to 1997 and 1998, at which time the UK agency population peaked at 138 in both years (employing 60% of the home civil service staff). By 2010, the number of agencies had fallen to 84 (but still employed 62% of that staff). The five largest agencies employed some 207,000 staff. So the questions are, were executive agencies just a passing fad and was the cyclical disaggregation and reaggregation thesis correct (Talbot & Johnson, 2007)?

Executive agencies proved difficult to sustain in politically sensitive fields in which ministers wanted to reassert direct hierarchical control. Both the Borders Agency and Passports Agency were eventually reabsorbed into the Home Office. Elston (2012) found a mixed pattern in those agency closures that was evident in U.K. central government: 33 had been reabsorbed by their sponsors, but a larger group (48) have taken the form of agency-agency mergers. A smaller number of “super agencies” have emerged with responsibility for the delivery of services across whole fields and reduced internal fragmentation. Elston (2012) concluded that many agencies “live on,” perhaps in an altered state, as part of an inheritance from the NPM era.

The third M in the 3M model refers to measurement. NPM reforms sought to promote high public agency performance. In what was now a low-trust culture, however, agency performance had to be measured so that it could then be actively challenged and managed, if need be, from outside. Tacit and professionally dominated forms of self-regulation gave way to externally produced and explicit forms of performance measurement systems. Rising groups of regulators, inspectors, and auditors (Power, 1997) developed performance management systems to identify and put pressure on the tail of poor providers. Extensive key performance indicator (KPI) data on core agency targets (e.g., on examination results in schools or waiting times in hospitals) were routinely collected and passed up to the surveying national central regulator for evaluation, classification, and publication, a process that was facilitated by the rapidly growing technological power of information technology systems (Zuboff, 1988). U.K. examples of performance measurement- and management-oriented regulators included the audit commission in local government (later abolished), Office for Standards in Education (OFSTED) in school based education, and various regulators in the health sector.

NPM’s Underpinning Intellectual Ideas

The NPM should be construed as an intellectual and ideological movement, as well as a political one, notably so in New Zealand (Halligan, 2011; Boston, 2011; Boston et al., 1996), whose reform process was heavily influenced by its national treasury, which drew on the ideas were extremely clear and guided by public choice and agency theory.

NPM doctrines rest on a sophisticated intellectual base coming from organizational economics, which reacts against the old Weberian sociological theory of the public bureaucracy (Weber, 1946). Weber saw the bureaucratic mode as expressing an attachment to rational legality and as the most technically efficient mode of organizing the modern state. Bureaucrats are further supposed to serve the public interest and display a duty of service to the government, rather than pursue their private interests. In return, they are compensated with a lifelong salaried career (and pension) and a protected social position (e.g., the German upper civil service, or beamter, who have a special legal status). They help provide the background capacity needed for a private sector to flourish within the rule of law (e.g., contract law, private property rights) and a constitutional state (Du Gay, 2000). Weber was, however, critical of bureaucracy’s “rule-bound” nature, trapping bureaucratic office holders in the “iron cage” of formal—but not substantive—rationality.

Niskanen’s (1971) classic work of public choice theory challenged more optimistic public service and public-interest-oriented models of public bureaucracies, suggesting that it is rational for careerist public bureaucrats to maximize their budgets, and hence their jurisdictions and power bases. One implication is that ministers, as political principals, should find novel policy instruments to increase their levels of “real control” over their civil servants who were only nominally their agents but often in practice engaged in bureau building and private agendas.

Niskanen (1971) (as Boston, 2011, p. 24, points out) was also concerned about the risk that politicians would favor short-term electoral and partisan objectives, essentially joining with sectarian pressure groups to form pro-public-spending coalitions (and, it might be added, expansionist public agencies). In public choice theory the prospect was raised of “government failure” resulting from the ever-growing public sectors, high taxation levels, and in the end, poor economic performance. Policy responses to combat this threat include the design of new constitutional arrangements designed to limit public expenditure and achieve increased transparency and external scrutiny of political decisions around public spending. For example, the Office for Budgetary Responsibility in the United Kingdom defines its mission as follows: “It is the duty of the Office to examine and report on the sustainability of the public finances” ( It serves as an expert and independent voice in reviewing and commenting on the public expenditure plans produced by elected politicians.

Agency theory represents an important second intellectual influence (Boston, 2011, p. 25) on the NPM. Agency theory (see the overview by Eisenhardt, 1989) argues that the relationship between a principal (shareholders in a private firm, an elected minister in a ministry) and agents (salaried managers in the private firm, civil servants in the ministry) can be structured through tight contracts, of either an explicit or a psychological form (Boston, 2011, p. 26): “accordingly, the question of how best to construct, monitor and enforce contracts (or agreed relationships) between principals and agents is both extremely common and an issue of enduring significance.” Principals and agents may have different assumptions, and agents are typically seen as more risk averse since they have fewer alternatives. The low-trust assumptions of NPM suggest that where activity is not readily observable by the political principal, bureaucratic agents may “shirk” their responsibilities.

Agency theory has strong application in two areas of NPM reform efforts. The first area is the redesigning of human resource management (HRM) systems. This perspective supports a move—especially for senior public-management posts—away from nationally agreed pay scales to more individualized contracts to ensure “pay for performance.” Senior public managers could and should be incentivized to hit the key performance indicators (KPIs) that are set. Pay levels rise, but in return senior public managers have less certainty about continuing tenure. They might be employed on medium-term renewable contracts. Turnover rates rise when senior managers in public agencies that are deemed to be failing are cleared out in turnaround regimes (Harvey, Jas, Walshe, & Skelcher, 2010). Turnover rates among senior management may rise to the extent that senior management becomes dysfunctional, as teams dissolve and organizational memory erodes (see Hood & Dixon, 2015).

A second implication of agency theory lies in the governance domain, specifically the strengthening of the oversight role of the board in monitoring the performance of senior public managers. The board of a public agency has a compensation subcommittee comprised solely of nonexecutives that often considers pay levels, replicating behaviors previously associated with private sector Public Limited Company (PLC). In higher education, for example, a compensation subcommittee of the council often assesses the performance of the vice chancellor against agreed objectives and determines the annual compensation package. More information on these senior managers’ organizational performance flows upward to the board’s subcommittee to support these judgments, facilitated by formal performance-measurement systems and publicly available league tables. Critics argue that such assessments have been too “soft,” fueling a top pay spiral in the public sector replicating that in the private sector.

Vignettes of Non-U.K. Countries with High-Impact NPM Reforms

Two brief vignettes of non-U.K. countries that also have high-impact NPM reforms are now presented to illustrate their international reach.

New Zealand shows a radical period of NPM reforming in the late 1980s and early 1990s. Halligan (2011, p. 87) characterizes the New Zealand reform package as based on two main principles. The first was the separation within central government of distinct policy and delivery roles, and the second was the identification of specific functions with specialized organizations. Government roles divided into the purchaser of outputs from public agencies and the owner of agencies that produced the outputs, with the latter having a strong interest in securing return on investment. There was extensive corporatization and the creation of more “businesslike” state-owned enterprises. There was also major contracting out of service provision by the new purchasers. Halligan (2011, p. 97) noted the redefinition of ministers’ relationship with their senior civil servants who were now renamed chief executives and took on contract-based appointments based on performance agreements.

Sweden: here we draw on Foss Hansen’s (2013) chapter. Sweden is portrayed as a radical early mover toward NPM ideas, partly because of a fiscal crisis in 1990, which led the downsizing of a historically large public sector. These ideas were largely accepted by the center-left Social Democrats, as well as by the center-right parties. There has been extensive decentralization of service delivery responsibility to local government. The Swedish case displays a trong emphasis on the principles of user responsiveness and free choice, for example, in local government when purchaser provider arrangements were brought in (Foss Hansen, 2013, p. 124). Service delivery in local government may now be performed by not-for-profits, cooperatives set up by users, and private firms, as well as by traditional public sector providers.

Plotting and Explaining the International Spread of NPM Reforms

A major theme has been exploring patterns of NPM spread and variation internationally. Hood (1995a) identified a cluster of Anglo-Saxon countries as “high-impact” NPM states (e.g., United Kingdom, Australia, Canada, and New Zealand) but also unexpected candidates such as Sweden.

The United States was assessed (Hood, 1995a) as only “medium impact.” The American case can best be seen as an idiosyncratic hybrid that combines elements of NPM with pre-, non- or even anti-NPM strands. Despite displaying a political tilt toward the neoliberal right under President Reagan (1980–1988), it is noteworthy that Hood did not assess America a high-impact NPM jurisdiction.

Pollitt and Bouckaert’s (2011) “country file” on the United States (pp. 321–331) provided an analytic history of what they see as the main public management reforms there since the 1970s. They highlight the antibureaucratic and antiwaste rhetoric behind many successive reforms. Efficiency drives by themselves can be seen as relatively crude and as predating NPM. There has also been a tendency to bring in business people as advisers, reflecting a wider American pro-business culture, and policies to increase the contracting out of public services. Whether these measures represent a coherent NPM style reform package seems more doubtful.

Perhaps the best known American public management reform package was the National Performance Review led by Vice President Gore (Democrat) in the 1990s. The NPR included both a “savings and downsizing theme” (NPM orthodox) and a second “empowerment and reinvention” theme (associated with alternative and softer approaches), and some tensions were evident between them (Pollitt & Bouckaert, 2011, p. 326). Osborne and Gaebler’s (1992) book Reinventing Government represents perhaps the most well-known recent American text on public management reform, so its content is worth a closer look.

This text, too, can be seen as a curious hybrid. It certainly includes some NPM-compatible chapters: chapter 1, “Steering Rather Than Rowing”; chapter 3, “Competitive Government: Injecting Competition into Service Delivery”; chapter 5, “Results-Oriented Government: Funding Outcomes Not Inputs.” However, other chapters introduce very different ideas. Chapter 4, “Mission Driven Government: Transforming Rule-Driven Organizations,” reflects the cultural school of strategy (see Peters & Waterman, 1982, for an analysis of the characteristics of excellent American private firms), with its emphasis on strong and positive collective cultures that provide strong energy for innovation. Chapter 9, “Decentralized Government: From Hierarchy to Participation and Teamwork” is based on a different set of “soft” management ideas of participation, teamwork, quality circles and organizational development.

How can these “medium” levels of NPM impact in the United States be explained, when key American authors (e.g., Niskanen, 1971) have written influential texts that first developed basic public choice ideas? The United States also has well-developed management consultancies and business schools that are seen as important diffusers of NPM ideas globally (Ferlie et al., 2016). One political-science-based explanation for NPM’s weaker internal impact highlights the separation of powers between different branches of United States government (executive, legislative, and judicial) and also the devolution of many competences from the federal to the state level that restrict the ability of the president to engage in centralized top-down reforming. A second explanation could lie in the smaller scale of the American public sector so that the political “pay off” from—and therefore top-level political interest in—public management reform activity was correspondingly lower (Hood, 1995a). The United States does not, then, appear as a centrally important jurisdiction on the NPM radar screen. Interestingly, Halligan’s (2011) analysis of NPM within Anglo-Saxon countries does not consider America at all but instead reviews the four cases of the United Kingdom, Canada, Australia, and New Zealand.

“Low-impact” countries identified by Hood (1995a) included such important cases as Spain, Japan, and Germany. So there were “leaders and laggards” in NPM reform internationally and as yet no radical process of global convergence. Nor did high NPM impact always correlate with right-wing political control; Sweden, for example, was under social democratic control during much of the critical period, while low-NPM-impact Japan consistently had right-wing governments.

This NPM literature relates to the wider convergence (versus) divergence debate. The core question is, will all countries eventually converge in a global NPM reform wave (Hood, 1995b), or will national variation remain strong, reflecting conditions of path dependence? Pollitt and Bouckaert’s (2011) comparativist analysis argued that different tracks of public management reforming remained strongly evident internationally. For instance, Germany is seen as being on a neo-Weberian track and remains largely NPM resistant.

Yet some pro-NPM diffusion forces that may promote global convergence need to be considered seriously. Pierre and Rothstein (2013) have argued that influential international bodies, such as the World Bank, the International Monetary Fund, and the Organization for Economic Cooperation and Development, help export NPM reforms to the developing world as supposed instruments of “good governance” to combat corruption. At least a declared intent to adopt NPM reforms may be a condition of such agencies agreeing to structural adjustment packages.

An analytic focus on international flows of management texts and knowledge (Ferlie et al., 2016) suggests that the expanding management-consulting sector may represent another important diffuser. In addition, well-selling public management texts circulate internationally and are imported by public services organizations. Osborne and Gaebler (1992) is perhaps the best known public-management-based text. Successive private-sector-oriented management texts (from Peters & Waterman, 1982, onward) have also been influential in public services organizations. These texts and models are often produced by elite American management consultancies (e.g., McKinsey’s) or business schools (e.g., by faculty at the Harvard Business School) and later diffuse internationally from the United States and from their original base in the private sector to public sectors in other countries. These credible forces for convergence should be considered, alongside the argument for enduring local conditions and path dependency.

A Review of Literature on the NPM’s Possible Effects

The lively debate about the possible advantages and disadvantages of NPM reforms will now be reviewed.

Possible Advantages of NPM Reforms

Firstly, NPM reforms seek to produce better value for money in the provision of public services, accurately reflecting a shift toward a changed political climate characterized by increased electoral tax aversion and suspicion of “big government.” Clearly, the search for greater operational efficiency is apparent in many NPM reforms (but for empirically informed and pessimistic analyses of the U.K. case, see Hood and Dixon’s [2013, 2015] important overviews). At a mundane level, public agencies were given annual efficiency savings targets to meet within tighter budget rounds. The contracting out of services could in principle reduce the high social and add-on costs in the core public-sector labor market, for example, public-sector pension costs (although Hood & Dixon, 2015, suggested that badly handled outsourcing may have increased costs). The greater employment of contract-based workers rather than permanent labor is indicative of a more flexible public-sector labor market, which might drive down wage levels.

Secondly, NPM reforms seek to create more pressure for higher public agency performance. In particular, they address the “tail” of poor public services providers that had previously held a monopoly over their jurisdictions and had not faced contestability. There are a range of sanctions available within NPM reforms, from the “naming and shaming” of failing agencies in visible league tables to being fined by regulators to replacing the whole top management team in turnaround exercises and, in extreme cases, the loss of jurisdiction to an alternative provider and agency closure.

Thirdly, NPM reforms foster greater choice and give a greater voice to the users of public services, who are now construed as customers (more than as citizens). These reforms may reflect wider societal values that have become less deferential and more consumerist. For example, U.K. undergraduate students now pay higher tuition fees than previously. In return, universities have been compelled by the sectoral regulator (the Higher Education Funding Council for England) to implement mechanisms to increased voice to students (such as student experience surveys) and to publish key performance information on their websites (e.g., number of contact hours, external examiners’ reports) to inform student choice.

Fourth, and as already noted, NPM reforms are often seen as a policy instrument that can promote good governance and increased transparency in developing countries, where there may be inherited problems with extensive government and high levels of corruption that make simple donations of aid ineffective. Such NPM reforms may be instantiated within a newly founded and specially constructed agency outside government that can be staffed by a carefully selected “modernizing elite.” The Higher Education Commission in Pakistan, for instance, has been supported by the World Bank and has an important role in attempting to upgrade the country’s large higher education sector. A counterargument is that arguably the elaborate contracting processes associated with NPM reforms reopen the door to corruption.

Some Disadvantages of NPM Reforms

A first major criticism is that NPM’s guiding values favor efficiency over democracy to an excessive extent. In the U.K. case, some political scientists (Skelcher, 1998) have pointed to the so-called democratic deficit that has accompanied the significant transfer of functions from elected local government (which may be under the control of opposition political parties wishing to expand public service and spending) to appointed agencies or “quangos” set up by the central state. NPM reforms in the United Kingdom have typically shrunk the scope of elected local government and expanded that of appointed agencies.

A good example is the moving of the old U.K. polytechnic schools (offering more vocational degrees) in the higher education sector from local government control in 1992 and their re-creation as the so-called New Universities and as independent corporations. Knight (2002) has criticized their governance model, which essentially adopts that of the Anglo-Saxon private firm: there is a strong vice chancellor who is expected to operate as a CEO, balanced by a small and senior group of nonexecutives, usually drawn from the business sector and deliberately recruited from outside the academic sector. Staff and student representation at board level was weak, as was the academic board supposed to provide advice on academic matters.

A second claimed disadvantage is the “hollowing out” of the creative policymaking capacity traditionally provided by central civil servants and an excessive swing to operational management or “delivery.” It is argued that “policy disasters” (or large-scale, avoidable, policy mistakes) increasingly emerge (Dunleavy, 1995). Greer and Jarman (2007) have described England’s Department of Health as morphing into the “Department for Delivery” in the 2000s, when NHS managers began displacing career senior civil servants because the former were felt to be more responsive to ministerial direction and willing to “deliver” their agenda.

Thirdly, the NPM’s construction of autonomized and specialist agencies can counterproductively strengthen inward-facing “silo” thinking and erode wider systemic capacity, a criticism perhaps acknowledged in the decline in the number of executive agencies (Elston, 2012). Not all government tasks are high volume or simple, or amenable to rapid productivity increases. The question arises of how to handle important “wicked problems” that cross silo boundaries and require network- or systems-based responses and also coproduction with citizens (these problems include climate change, the aging society, and obesity and type 2 diabetes; Ferlie, Fitzgerald, McGivern, Dopson, & Bennett, 2011, 2013). Interagency fragmentation was a negative feature in the New Zealand case (Halligan, 2011), which later was unpicked.

Fourthly, the NPM is based on strengthening management, directed against supposedly over mighty public sector producers. There has been concern that the pendulum has swung too far toward manageralization, with little professional ownership of top-down reforms (Thomas & Davies, 2005). Subsequent post-NPM reforms shifted away from promoting general management back to a broader and softer notion of leadership (e.g., Berwick, 1994; Llewellyn, 2001), which might come from professional managerial hybrids (e.g., headmasters in schools) rather than general managers. This leadership style is seen as more transformational than transactional and more likely to engage with skeptical rank-and-file staff (Angawi, 2012).

Fifth and finally, NPM reforms may erode the “organizational ambidexterity” (Raisch & Birkinshaw, 2008) that some strategic management research argues is a hallmark of a successful organization. This concept suggests that an ambidextrous organization needs to achieve a balance between short-term exploitation activity and longer-term, more creative exploration activity.

NPM reforms typically reinforce the dominance of a short-term, target- and efficiency-driven, and operational-management-oriented agenda. Yet this perspective may have negative side effects and unintended consequences. Harvey et al.’s (2010) examination of poorly performing U.K. public agencies, for example, found that low “absorptive capacity,” the ability to sense, import, and use readily available knowledge about poor performance levels, contributed to their escalating difficulties.

So how does longer term organizational learning, creativity, and innovation occur in NPM-orientated public agencies, if it does? The danger is that its short-term focus on securing measurable improvements in operational efficiency crowds out these longer term and more diffuse capabilities that are nevertheless critical for the long-term health of these agencies. Thus Hartley and Rashman (2010, p. 156) draw a typology of what they call “leadership for performance” (short termist, pre-planned, micro level, and mechanistic) and “leadership for learning” (longer term, more discovery based, emergent, and macro level) in public agencies. They argue that the performance agenda has been overdominant in NPM- oriented public services and has marginalized alternative learning-based approaches. The danger is that such public agencies may not be able to sense or cope with unexpected or discontinuous environmental change, be resilient when faced with sudden crises, or able to launch radical innovations.

Putting Public Management Scholarship Back into the NPM

The New Public Management invites comment from the public management discipline. NPM writing has involved various social sciences, including public choice economics (Niskanen, 1971), where powerful underpinning ideas have been generated. A major contribution comes from political-science-based authors, especially from the public administration end of that discipline. Political scientists have often been skeptical about the dysfunctional effects of NPM reforms (Dunleavy, Margetts, Bastow, & Tinkler, 2006), stressing the erosion of policymaking capacity (Dunleavy, 1995) or their antidemocratic consequences (Skelcher, 1998). Their focus is often at the macro level of the nation-state and may even involve the comparative analysis of states (Hood, 1991, 1995; Lodge & Gill, 2011).

What can the discipline of public management add to this extensive political-science-informed literature? More so than in political science, management research operates at the meso level of the public services organization (seen in informal and in formal structural terms) or even the micro level of the individual public manager, where roles and even identities may shift as individuals resist, adapt, or embrace NPM reforms. Recall the proliferation of different schools seen within the broad discipline of management over the last generation (Clegg, Hardy & Nord, 1996), reflecting wider developments in other social sciences (e.g., gender perspectives, the green perspective). This means that there are many different management-based approaches that can potentially be used to study the NPM “problem.”

As an initial generalization, the European management research tradition shows greater emphasis on critical and interpretive approaches; by contrast, American management research tends to tilt toward quantitative and performance-oriented work. There are, of course, many exceptions to this assertion, given that international networks of scholars working in either approach also cross national boundaries. Some management academics are eclectic and use various theoretical framings, depending on the problem. Nevertheless, the point remains that there is now strong diversity in academic management writing incorporating various mainstream but also more critical approaches.

This section briefly reviews work from different schools of management research, suggesting that they all usefully bring in new contributions but in distinctive ways. They presented in a rough order, ranging from the quantitative and functionalist toward the interpretive and critical (though there are also important schools in the middle). By way of academic shorthand, the discussion moves from the academic “right” of the study of performance through the “center” of professionals in organizations and ends with the academic “left” of critical management studies.

First, and firmly located in the mainstream camp, Boyne, Meier, O’Toole, and Walker (2006) argued that agency performance has now become a—or even the—major question in public management scholarship. Their research agenda fits well with the orthodox NPM prism and its emphasis on performance. This tradition explores the correlates and modifiers of public agency performance in (among others) U.K. local government settings (Andrews, Boyne, & Walker, 2006; Andrews, Boyne, Law, & Walker, 2009), sometimes using the statistical analysis of survey-based data across a population of public agencies (see also Walker & Boyne, 2006). Alternative questions of democracy or equity in this stream remain less explored.

Also toward the mainstream end of the research spectrum lie attempts to study public agencies through generic strategic management writing, sometimes still in a sectorally adapted form (Moore, 1995; Ferlie & Ongaro, 2015; Rosenberg, Hansen, & Ferlie, 2016). For example, Andrews et al. (2006) connected their exploration of public agencies’ performances with analyses of their strategic styles, using Miles and Snow’s (1978) typology.

Given that NPM reforms often create autonomized service delivery organizations with discretionary managerial action (e.g., executive agencies, NHS Foundation Trusts (FTs)), strategic management approaches may have become of greater academic, as well as practitioner, interest at this meso level. The full title of Moore’s (1995) well-known book on public value is Creating Public Value: Strategic Management in Government (for a political-science-based criticism of its openness to private sector management techniques, see Rhodes & Wanna, 2007).

Bryson’s (2011) influential model of a strategic change cycle is (American) designed public and not-for-profit agencies; it brings together a conventional analysis of the fit between the organization and its external environment, characteristic of the early design and planning school of strategy (Mintzberg, Ahlstrand, & Lampel, 2009; Ferlie & Ongaro, 2015) but here allied to a parallel concern with softer issues of organizational visioning, learning, and change.

The competitive forces developing in quasi-market-based or marketizing sectors now containing public services organizations may make other private-sector-based models of competitive strategy (e.g., Porter, 1980) more appropriate. Porter and Teisberg (2006) apply standard Porterian concepts in analyzing the failings of the large, strategically significant American healthcare sector, arguing that it needs a better value-based style of competition, not less competition. The resource-based view of the firm approach has analyzed the (sometimes problematic) acquisition, internalization, and use of knowledge within public agencies, in particular the related resource-based-view concepts of “dynamic capabilities” (Casebeer, Reay, Dewald, & Pablo, 2010) and “absorptive capacity” (Harvey et al., 2010).

There is a question of about whether generic strategic management models should still be customized to public services contexts. Vining’s (2011) exploration of Porterian models in current public services settings argued they still require adaptation to what remains a more political context but also helpfully sketched out a ladder of politicality, which ranged from the highly politically sensitive advisory units in prime ministerial or presidential offices down to a growing number of autonomized executive agencies or public-private hybrids, where private sector models are seen as more applicable.

We now review what might be termed a centrist school of management research from the discipline of organization studies. Public services organizations have historically been seen as highly professionalized, for example, in the health, education, and legal sectors. Healthcare is a sector of great interest in this field, given the historic success of the clinical professionalization project. Thus some classic sociology of the professions literature has historically been particularly interested in healthcare settings. Freidson’s (1970) theory of professional dominance explored the high autonomy of American medicine in its most powerful period. Mintzberg’s (1983) organizational archetype of the “professionalized bureaucracy” (e.g., in teaching hospitals) teased out the implications of such conditions for a distinctive form of strategy making (e.g., facilitative and nondirective administration; disconnected, bottom-up, and incrementally expansionist bids from core professionals; a weak strategic core; see Denis, Langley, & Lozeau, 1991, for an empirically informed study of similar processes in an empirical study of strategic planning in Canadian hospitals).

Freidson (1985, 2001) later revised his original professional dominance thesis to concede there was some movement away from it, but this change was seen as less radical than the analysis provided by more critical deprofessionalization authors (McKinlay & Arches, 1985; McKinlay & Stoeckle, 1988). A preferred alternative scenario was one of “professional restratification” whereby professional elites (especially two forms of managerial and knowledge-based elites) separated themselves out from the professional rank and file (see also, Waring, 2014, for a more developed typology).

The implication was that an elite subgroup of healthcare professionals might take on management tasks and perhaps even marginalize the newly empowered general managers in a process of “professional recolonization” (Waring, 2007). A considerable empirically informed literature has by now examined these clinical managerial hybrids, their knowledge bases, how they construct their roles, and any shifts in underlying identities. To what extent are these hybrids able to balance what might be seen as distinct professional and managerial roles and logics? Or are they seen as “going over to the dark side,” losing legitimacy with their clinical colleagues. For example, Llewellyn (2001) was relatively optimistic about the ability of doctors to take on managerial roles as long as they developed more financial expertise. It was easier for them to acquire managerial expertise than it was for general managers to acquire clinical expertise. Croft, Currie, and Lockett (2015), by contrast, were more pessimistic about the ability of (in this study) nurse managers to maintain an effective balance between the two different roles.

Some authors recently argued for the revival of professionalism as a governing logic against what was now seen as an overdominant and failed managerialism (Freidson, 2001). Martin, Armstrong, Aveling, Herbert, and Dixon-Woods (2015) explored the fate of attempts to restimulate professional logics in service improvement projects in the English NHS to secure genuine professional engagement with change. These projects ran into the problem that the professional logic was not the only or even the dominant logic in the current healthcare field: managerial logic retained considerable power over the allocation of resources. While much of this literature has been healthcare based, it can be applied to other public services settings with influential professions (e.g., education, science-based public agencies, the legal system).

On the more radical side of the spectrum of management writing, critical management studies (CMS) has emerged as an important academic current, especially within the European and U.K. traditions (Alvesson & Willmott, 2003). It can be seen as broadly anticapitalist in orientation and open to various theoretical currents from the wider field of social science. Influences include but go beyond the Marxist tradition of labor process theory to include a gender perspective and also a developing Foucauldian body of scholarship on the way new Information and Communication Technologies (ICTs) morph into electronic surveillance regimes (Doolin, 2004) within public agencies. CMS scholars are interested in the distribution and use of power in organizations and are broadly critical of the top-down nature of NPM reforms, which they see as alien and as imposed on rank-and-file staff.

Currie, Ford, Harding, and Learmonth (2010) outline a manifesto for CMS approaches within public management that draws on several theoretical perspectives, including Foucualdian analyses, psychoanalytic studies of organizations, and theories of gender and sexuality. In addition, some labor process scholars have examined developments in public sector organizations from a work intensification perspective (see Smith et al., 2008, on the limits to changing control modes in a NHS call center staffed by nurses).

NPM reforms have often been strongly critiqued by CMS scholars for their imposition of a markets/management governance mode in what is construed as a historically cooperative and team-based public sector. Such top-down reforms, in this view (Currie et al., 2010), may well and rightly face opposition from the rank-and-file workforce or even from those in the middle of the hierarchy who are expected to manage in new and oppressive ways. For example, some critical management scholars have explored the micro politics of ground-level “resistance” to NPM reforms by individual public managers (Thomas & Davies, 2005), using an intensive analysis of a small number of interviews and taking a Foucauldian perspective on identity creation and transformation. The critical perspective further includes a gender prism (Davies & Thomas, 2002): should the NPM be seen as a male and alien style of managing being inappropriately imported into the public sector (where many rank-and-file workers are female, such as teachers and nurses, and where government has traditionally been a family-friendly employer) from “macho” private firms? Alongside empirically informed critique, more normative CMS argumentation imagines alternative and more emancipatory organizational settings in a post-NPM public sector (Currie et al., 2010).

It is thus suggested that public management research and writing on the NPM has four strong and distinctive themes, which complement and adds to the broader literature from other social science disciplines, notably political science: (a) performance levels in public agencies, (b) their strategic management, (c) the management of public services professionals, and (d) a critical perspective on resistance to NPM reforms.

Conclusion: A Backward and Then a Forward Look

After nearly thirty years of NPM scholarship, a question is, how has this corpus of work evolved over time? One way into this question is to compare and contrast an influential early article (Hood, 1991) with an important later handbook (Christiansen & Laegreid, 2013). Hood (1991) offered a high-level analytical overview of the main defining principles of the NPM movement—including but going well beyond the narrow focus on privatization and marketization apparent in political discourse—and related them to a rising set of political values that prioritized efficiency and value for money.

As might be expected, the later handbook by Christiansen and Laegreid (2013) contained many more analyses of major NPM reforms in action, both of countries and of important sectors (e.g., healthcare, higher education). There was also an attempt to explore the effects and implications of NPM for public agencies and, indeed, publics. The final section explored possible post-NPM models and so was more forward looking (although it is also possible that NPM remains embedded, as explored later in the conclusion).

A second observation on how scholarship has evolved over time is that much of the work cited in section “Putting Public Management Scholarship Back into the NPM” on management-oriented research on the NPM comes from after 2000. It is possible that management researchers have come into the field later than their political science colleagues, perhaps as the effects of macro-level NPM reforms began to become more apparent at the meso level of the public agency, which is the unit of analysis of most interest to many management scholars. There appears to be more mileage in some of the research themes introduced in this section, notably including the need for more work on the strategic management of NPM style public agencies.

Looking forward, what, if anything, is new for management scholars to say about the long-standing NPM phenomenon? Firstly, academics’ continuing search for the next “big” reform wave in public management (Moore, 1995; Newman, 2001; Rhodes, 2007; Dunleavy et al., 2006) raises the question of whether the NPM has really been “deinstitutionalized” (Oliver, 1992) or whether the NPM paradigm remains embedded, even if dysfunctionally so (Lodge & Gill, 2011; Trenholm & Ferlie, 2013). This NPM embeddedness problem could be tackled from an institutionalist viewpoint (Oliver, 1992) by theoretically examining which processes might be expected to occur in any such deinstitutionalization. Any erosion of NPM’s political and societal legitimacy may be an important indicator, since it would indicate change in the core domain of social and political values. Such a theoretical look would helpfully inform later empirically based assessments.

Secondly, and again within a broadly institutionalist framing, the diffusion of NPM reforms, texts, and knowledges can be used as an important concrete example in the wider exploration of the international diffusion of management knowledge (Sahlin-Anderson & Engwall, 2002a, 2002b). International fashion setters in the NPM field may include actors such as the World Bank and management consultants (Saint Martin, 2004; Osborne & Gaebler, 1992) along with the texts coming from business school faculty (Porter & Teisberg, 2006; Ferlie et al., 2016). Some private sector management texts appear to have had strong impact on public managers’ styles of working, associated with the increased receptivity associated with NPM reforms. For example, Hughes’s (1996) study of a newly appointed general management team in a Welsh healthcare site found a surprising infusion of transformational and entrepreneurial ideas about management style, as a “block buster” and culturally orientated American management text (Peters & Waterman, 1982) crossed into U.K. public services settings.

Thirdly, the role of the core professions within public services organizations (e.g., clinicians, lawyers, academics) and their relationship to NPM reforms remains of great interest. Will the old logic of professionalism eventually be remobilized against empowered managerialism (Freidson, 2001; Martin et al., 2015), especially if levels of social and political trust in the “hard” ethos of NPM erodes?

The evolution of the professions and individual professionals in the public agency setting is of great interest. Do the professions restratify internally into managerial, knowledge-oriented elites and a rank and file (Freidson, 1985), or do groups of professionals collectively recolonize originally managerial domains of work (Waring, 2007)? How do individual “hybrids” (e.g., doctors who take on part-time management roles) balance the different logics of professionalism and managerialism and reconstruct roles, careers, and even perhaps their underlying identity (McGivern, Currie, Ferlie, Fitzgerald, & Waring, 2015)?

In conclusion, this article reviewed the key characteristics of the major public management phenomenon that is the NPM. NPM has triggered much academic writing from various disciplines, with a major influence from political science, but the substantial contributions of some very different streams of public management scholarship to the analysis of the NPM was discussed and elucidated. Although the NPM is indeed in its mature phase, three suggestions for contained areas of future research work were made.


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