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How does public management differ from private management and leadership?

Harman Wingfield

Public management and private management and leadership have different objectives, structures, and stakeholders. Public management refers to the planning, organizing, directing, and controlling of government programs and services for the public good. Private management and leadership, on the other hand, involve the management and leadership of businesses or organizations that operate for-profit and are accountable to their owners or shareholders.

One of the main differences between public and private management and leadership is the nature of their objectives. Public management is primarily concerned with promoting public welfare and providing essential services to citizens. Public managers must balance the needs of various stakeholders, including politicians, interest groups, citizens, and employees, while also adhering to legal and regulatory frameworks.

In contrast, private management and leadership focus primarily on profit-making. Private managers must balance the needs of customers, employees, and owners or shareholders, and make decisions that maximize the value of their company. Essentially, private managers and leaders focus on building strategic plans and executing them for the success of the business.

Another difference is the structures and decision-making processes of public and private organizations. Public organizations are hierarchical and bureaucratic, with formalized processes and procedures. This is necessary due to a large number of employees, public funds, and the nature of the government. Decision-making is often slow and requires multiple layers of approval and review. Public managers must navigate a complex web of political and bureaucratic processes to accomplish their goals.

In contrast, the private sector is typically leaner and more responsive to market pressures. Decision-making is often quicker and less formalized, with more autonomy given to individual departments or teams. Private managers and leaders have greater flexibility to experiment with innovative strategies and initiatives in the market.

Additionally, public and private managers and leaders have different stakeholders and audiences. Public managers must manage expectations of politicians, interest groups, media, citizens, and employees. These stakeholders have dissimilar objectives and views on the same topics. It puts pressure on public managers and leaders to be skilled at managing competing interests while maintaining focus on the end goal. Private managers, on the other hand, need to focus on delivering value to customers and generating profits for shareholders. The decision-making in private organizations is often influenced by market trends.

In conclusion, public management and private management and leadership have distinct differences in their objectives, structures, and stakeholders. Both entail different approaches, strategies, and techniques. Public managers must take a more formalized and bureaucratic approach, navigating a complex network of stakeholders and regulations to provide essential services to the public. On the other side, private managers and leaders have more flexibility to innovate and make decisions that are beneficial to their organization and their shareholders. Understanding these differences is essential to be a successful leader in either sector.