Public Administration and Private Management

Difference between Public Administration and Private Management 

Public administration occurs in organizations that are operated or owned by the government. These organizations include agencies, bureaus, local, state, and federal authorities. Public administration is responsible for planning and managing core functions such as healthcare, education, police services, other law enforcement agencies, and correctional facilities. In that regard, public administration is structured in hierarchies that permeates a lot of bureaucracy. On the other hand, private organizations are owned privately. These organizations are involved in a broad spectrum of business operations ranging from small businesses, partnerships, corporations, charitable organizations, for-profit, and non-profits ( Epstein, 2011) . Some examples include retail stores, local businesses, and credit unions. 

Public administration institutions provide services to the general public and do not compete with other organizations for profit. Due to this line of operations, they follow policies overseen by independent agencies, which are also publicly administrated. Thus, public administration is intertwined due to hierarchical and structural requirements ( Peters & Pierre, 2015) . For example, public auditors are required to audit governmental organizations while they are monitored by legislative branches such as Congress. As for privately managed organizations, competition plays a vital role in enhancing profitability and management responsibility. For instance, a private business manager is always under pressure to ensure the business keeps improving its productivity and profitability. Otherwise, the manager will lose his or her job as stipulated in employment terms. 

There are clear differences in terms of political direction in public administration and private management. In most, publicly administrated organizations are highly influenced by political directions of local, state, and federal governments. For example, Democrats and Republicans have different perspectives on the administration of public services such as healthcare and education. In that regard, changes in political directions imply a direct impact on publicly administrated organizations. In terms of managing private organizations, the political directions are minimized as much as possible. Most private organizations try as much as possible to avoid leaning to particular political alignments since such decisions could lead to loss of clients ( Epstein, 2011) . However, some private organizations such as media companies lean to the left or right depending on their target customer base. 

Table 1: Source: Epstein, 2011 

Private management is driven by private motive while public administration is influenced service. Hence, the quality of services delivered by publicly administrated organizations is the major concern to those tasked with evaluating these organizations. The same could be said of private organizations that offer services to their clients, such as those in the hospitality and tourism sector. For private organizations in the manufacturing industry, the quality of products is the main agenda ( Klein, 2015) . Public organizations focus on the correlation between service and cost offered to the public, where a balance between the two is given a priority depending predefined annual budget. On the other hand, private organizations focus on a balance between profit and customer satisfaction irrespective of the costs involved along the way. Due to these disparities, public organizations use a monopolistic approach to deter private organizations from competing. 

Implications of the Differences for the Public Administrator in: 

Decision Making 

Due to the nature of pressures associated with managing private and public organizations, the process of decision making is different. For instance, decision making involving conflicts in an organization are different between private and public organizations. In private organizations, conflicts are perceived as negative and unhealthy since they suggest that employees or other stakeholders are not working harmoniously towards the organization goals. On the contrary, public organizations may perceive conflicts as healthy on the grounds that they show that employees are participating actively. From that point of view, public administrators and private managers will take varied decision-making approaches relating to conflict management. In terms of hierarchy, public organizations use a bureaucratic approach influenced by government policies when making decisions. Hence, major decisions such as those involving budgeting require approval by many offices and agencies. For private organizations, major decision making is done by top management ( Abramowicz, 2007) . However, modern private organizations are involving employees in decision making. They also seek consultancy services from external organizations that offer expert consultations services for profit. 

Human Resource Management 

Private and public organizations have an almost similar interest in their employees, including high-performance requirements. Therefore, public and private organizations have strategies to motivate their employees. However, private organizations have a flexible approach to recruitment, training, and motivation. These organizations can easily tweak their human resource management structure to conform to modern standards. For example, they can set targets that, if met, employees are rewarded accordingly ( Howe, 2017) . On the other hand, public organizations have to follow government employment policies that regulate employment terms, job groups, and recruitment procedures. Due to these requirements, public organizations often face problems when dealing with performance issues. 

Table 2: Source: Curto et al., 2017 

Accountability 

Public organizations may have problems when addressing accountability issues due to their somehow fixed hierarchical structures. In some cases, duty redundancy where some roles and responsibilities are duplicated are rampant. This is why some public organizations such as local, state, and federal healthcare organizations enter into conflicts revolving around who was responsible for what in trying to debunk a crisis and establish whose negligence caused the crisis ( Curto et al., 2017) . However, increased citizen trust demands to enhance accountability and responsibility. For private organizations, and organizational structure is highly-structured to enhance the optimal accountability of employees. These organizations’ decision-making process is not influenced by public pressures. Instead, decision making is dependent on the situation at hand. All in all, private organizations are not bound by public laws but only conform to corporate social responsibility needs. 

References 

Abramowicz, M. (2007).  Predictocracy: Market mechanisms for public and private decision making . New Haven: Yale University Press. 

Curto, V., Einav, L., Finkelstein, A., Levin, J. D., Bhattacharya, J., & National Bureau of Economic Research. (2017).  Healthcare spending and utilization in public and private Medicare . Cambridge, Mass: National Bureau of Economic Research.   

Epstein, R. A. (2011).  Design for liberty: Private property, public administration, and the rule of law . Cambridge, Mass: Harvard University Press. 

Howe, C. W. (2017).  Inland waterway transportation: Studies in public and private management and investment decisions . London: Routledge. 

Klein, G. (2015).  Start-up city: Inspiring private and public entrepreneurship, getting projects done, and having fun . Washington, DC: Island Press. 

Top of Form 

Peters, B. G., & Pierre, J. (2015).  Public administration . Los Angeles: SAGE Reference.