Wikipedia defines public value as “the value that an organization contributes to society” noting that the term was “originally coined by Harvard professor Mark H. Moore who saw it as the equivalent of shareholder value in public management.”
Wikipedia goes on to say that:
“Public value is supposed to provide managers with a notion of how entrepreneurial activity can contribute to the common good. Nowadays, public value is no longer limited to the public sector, but is used by all types of organization, including non-governmental organizations and private sector firms.”
Moore’s arguments are set out in two major books, Creating Public Value – Strategic Management in Government (1995) and Recognizing Public Value (2013) referenced below and images to right.
In his 2014 review of this book (reference below), Shayne Kavanagh writes:
“Public value asks public officials to consider the benefits and costs of public services not only in terms of dollars and cents, but also in terms of how government actions affect important civic and democratic principles such as equity, liberty, responsiveness, transparency, participation, and citizenship. Public value seeks to provide public officials with the ability to talk about the net benefit of government actions, while overcoming the limitations inherent in attempting to create a “bottom line” that is analogous to that of the private sector.”
Kavanagh summarizes the four key points about strategic management that undergird Moore’s approach:
- “Attempts to directly import private sector strategic management techniques to the public sector are fundamentally flawed because of fundamental differences in the purposes and nature of public and private organizations. Therefore, a distinctive approach to value creation is required for public-sector organizations.
- “According to Moore, “strategic management” in the public sector has generally entailed: “1) focusing on the long run over the short run; 2) attending to large issues with a big impact on performance, rather than small issues with impacts on productivity; and 3) concentrating on ultimate ends, rather than needs.” Moore posits that much greater emphasis needs to be placed on finding a fit between the organization and the external environment in which that organization operates. Hence, diagnosing the external environment and then positioning the organization accordingly is an essential part of strategic management that is often under-emphasized in public-sector organizations.
- “Public managers often view performance management as a technical challenge rather than a political or philosophical one. Moore contends that the political and philosophical aspects of public performance management are at least as important as the technical aspect.
- “To produce value, public officials must consider the entire “value chain.” The value chain starts with inputs and moves to the production processes (e.g., policies, programs, activities) used to transform the inputs into outputs, which then affect a client (e.g., citizen, beneficiary, etc.), which leads to the social outcome that was the intended aim of the activity. Public management is often focused on just one part of the value chain. For example, traditional line item budgeting is focused almost exclusively on the “inputs” aspect of the value chain. More recently, attention has been placed on “outcome performance measures,” often with an implication that other measures (e.g., outputs, productivity) are inferior.”
Wikipedia (2017), Public value, at https://en.wikipedia.org/wiki/Public_value, accessed 12 September 2017.
Shayne Kavanagh (2014), Defining and Creating Value for the Public, Government Finance Review, October, pp. 57-60, at http://www.gfoa.org/sites/default/files/GFROct1457_0.pdf, accessed 12 September 2017.
Mark H. Moore (1995), Creating Public Value – Strategic Management in Government, Harvard University Press.
Mark H. Moore (2013), Recognizing Public Value, Harvard University Press.
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Page created by: Ian Clark, last modified on 19 September 2017.
Image: Amazon.ca, at https://www.amazon.ca/s/ref=nb_sb_noss?url=search-alias%3Daps&field-keywords=public+value, accessed 12 September 2017.