Public and Private Sector

5048 Words Sep 19th, 2011 21 Pages
“Private and public sector management differ only in context, but this difference is significant.”

George Boyne in his article “Human resource management in the Public and private sectors: An empirical comparison” explains with empirical evidence how even though private and public sector management differs in service ethos but this difference is significant which impacts the tradition, culture and practises of both the sectors. Over the past two decades many different interpretations and perceptions have come into play on the similarities and differences between private and public sector management.

Public sector management before the 1980s was found to be working more on a Weberian centralized model where you would find a
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Baldwin 1991).

The major differences between a private and public management is ownership, funding, public interest and mode of governance where public organisations are controlled collectively by the members of political community and depends on the political authority for its activities. This results in the political forces having a greater impact on the direct power of the public sector organisations. On the other hand, private organisations are owned by shareholders and entrepreneurs and the controlled or guided by the current global market forces. Public organizations are funded by taxes paid by citizens whereas the private companies are funded by customer fees and spending. However, Bozeman (1987) claims that, all organizations are public because they are all affected by political authority whether they are public or private. It is the political system that imposes more constraints rather than the economic system.

Goal is another factor which underlines the distinction between a public and private management. The understanding of ‘profitability’ goes a long way with the private companies having the main goal to sell their products in the market as oppose to public management. As a result, there has been considerable criticism on the various government agencies for their attempt to bring public management into line with private management. For example, Stewart and Walsh (1992, p.
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