New Public Management

The management philosophy that has dominated the field of publicly funded provision in the UK and elsewhere - running everything from social housing to social care, education and public utilities - is often called 'neo-liberalism'.

This is not wrong, if it is seen essentially as a pervasive ideology.  But as an approach with clear policies and lines of command, it is known more technically, for example in business schools where such things are studied with greater focus,  as 'the New Public Management', or NPM.

Some of NPM's more obvious manifestations in practice, such as the commissioning culture, the 'purchaser/provider' split, a preoccupation with quantifiable outcomes, and external regulation by supposedly independent bodies, are well known, though not often understood as a model, a systematised package of reforms introduced only in the last years of the 20th Century..

What is less well known is that the roots of this approach are themselves based in a particular 'psychological model', which can be identified, and assessed for its suitability - but rarely have been. This 'psychological model' therefore now underpins much of the way public services, including those attempting to develop as PIEs, are now provided; and those services wanting to assess where they stand in relation to these wider systems may at some point need to look upwards to address the strings that pull them.


NPM defined

Some of the most articulate and immediately intelligible critiques of NPM in the UK have come from the work of analysts such as Toby Lowe and colleagues, at Collaborate and at several university business schools. In 'A Whole New World: Commissioning in complexity', Lowe and colleagues sum up the NPM view thus:

"It has been characterised as ‘three Ms’: Markets, Managers and Measurement (Ferlie et al, 1996)

• Markets – the creation of markets for social interventions helps to drive innovation and efficiency
• Managers – social interventions must be overseen by people with training in professional management practice. Managers’ role is to identify what success looks like (strategic management) and to hold subordinates accountable, through performance management, for delivering it.
• Measurement – Metrics must be created which identify what success and failure look like, and performance must be measured against these metrics.'

'The roots of NPM lie in ‘Public Choice Theory’ (Buchanan and Tullock 1962). Public Choice Theory argued that the intrinsic motivation of those who undertake social interventions cannot be trusted to produce effective and efficient public services. Instead those people must be extrinsically motivated – through the incentives created by market forces, and through the use of performance targets.'

This psychological model is radically at variance with the lived experience of almost all those with actual experience of public services; and the tensions between their real motivations and those supposed in the funding model that provides their services is now increasingly exposed.

Finding an alternative means for funders to engage with providers and their staff on more suitable terms is now an urgent need; and if the PIE approach, the PIEs framework and the Pizazz assessment and audit mechanism can play a constructive part in this, and loffer new channels of communication, it will be long overdue.


Other critiques of NPM's psychological model

Others have critiqued the simplistic economistic model of NPM, bringing other models to bear of the structures it has created. Of these, the psychodynamic analysis of the splitting of purchasers and providers, and of providers and regulators, echo the studies of Zimbardo and colleagues on the polarisation of roles in institutions; and the observations of Transactional Analysis have highlighted the potential for dysfunctional dynamics in ill-thought-through separations of roles in any relationship.

More recently, organisations such as the Institute for Public Policy Research (IPPR) have argued that the NPM approach - and especially the assumption of 'extrinsic motivation' is insufficient to understand the motivations and morale of public services staff and other professionals; and methods derived from this unhelpful model are no longer  (if they ever were) fit for purpose for the current century, and the challenges of moving beyond silo'd services to better collaboration and shared goals.

This might suggest a return to the 'joined up thinking' that characterised, in the UK, the social inclusion approach of the New Labour administration at the start of this century, which argued, for example, that social exclusion results as much from an excess of focus on funded outcomes from specific services as on the actual complexity of the needs of those individuals that these overly-rigid services are then motivated to exclude.





PIElink pages

Where did it all come from? : HERE

The ethics and politics of PIE : HERE

Faith and values-based work : HERE

Evaluation by outcomes : HERE

'Joined up thinking' : HERE

Can smarter commissioning help? : HERE

360 degree evaluation : HERE


Library items

Funding and commissioning in complexity : HERE

Enabling Help : HERE

Good and Bad Help : COMING SOON

Whole systems as  PIEs (presentation): COMING SOON


On New Public Management critiques

Beyond outcomes (PIElink forum) : HERE

Centre for Public Impact : HERE

We know New Public Management fails : HERE

Human Learning Systems: a new paradigm for public services : HERE

Great government (IPPR report) : COMING SOON