Wednesday, January 17, 2007

Corporate versus Government

I read an interesting blog posting by Dave Snowden the other day about the context and uncertainties of government (opens in new window) in which he writes about the major differences between industrial and governmental environments within the context of trying to apply commercial models of practice to government activities. The article caught my eye partly because I have worked in both the private and public sectors and I think that the appeal of my CV to the public sector is that it contains private sector experience.

There is a view that in the competitive commercial environment, companies are forced to be lean and efficient while government, with no competition, has become large, wasteful, and inefficient. Dave Snowden’s entry talks about these different environments – government needs to be lean, efficient and effective because it is the only one that citizens have:
"Governments face a far more significant set of issues and problems than those faced by industry, and they face them over longer periods of time without the option of bankruptcy. Citizens cannot buy their services from another government, if their own fails. Neither can they insure against the consequences of a catastrophic failure of their state, they have to live with it. In addition Governments, to a greater extent than industry have to consider multiple interactions and interdependencies between initiatives and actions."

I think that most people would agree with Dave Snowden and what is interesting about this article is that it challenges the very tempting and automatic conclusion that therefore, government should apply the same models as used by industry to become the lean, efficient organisation; government’s unique position means many of these industry models are inappropriate. Consider:
  1. the level of magnitude and the consequences of government action in comparison with industry
  2. the fact that government de facto provides it’s [sic] own regulartory framework, while providing those frameworks to industry
  3. as an entity it carries a burden of responsibility for failure, while industry is constructed on the bases of failure as a market mechanism
  4. government operates as a unit of one, industry has many units within each market
The question is, then, who is developing government-appropriate equivalents to the industry models that have proven to be so useful there?

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