private and public administration differences

The established political, fiscal, and social framework is composed of both public and private institutions and organizations. The mutuality of these two leads to humanity's vital well-being. Many officials and economists around the world advocated modes of direct government intervention in most social, political, and economic practices prior to the 18th century. During this time, there was a strong sense of nationalism, with people believing that the state could control all facets of life. This started to shift with thinkers like Adam Smith, who believed that the economy had self-regulating structures and that the position of the government should be reduced. Many western governments heeded this advice and withdrew from the active market. However, it became apparent that some of the essential goods and services cannot be fully relegated to the private sector. Though many regimes either consider their authorities as capitalist or communist, they are indeed mixed systems. One of the key factors that determine the success of a political, social or economic system is leadership. In the contemporary world, there are many overlapping aspects in regard to leadership of private and public administration. This paper will analyze the issue of leadership from both perspectives and establish both similarities and differences. It will also discuss the implications of the findings and conclusions of this comparison. Public administration is fundamentally different from private administration. The differences emanate from the structure, goals, necessity and the expectations of each system of administration. Public administration is usually more essential, with wider goals, a complex structure and must meet a lot of expectations from the people. Private administration deals with relatively less essential goods and services, has leaner goals, a simpler structure and is expected to meet lesser expectations from the public. Many private institutions work in a competitive market and this means that once one is eliminated, another entity can take its place and continue providing goods and services for the people.

Background: The Necessity and Roles of Public and Private Administration

The contemporary economic, social and political organizations are tasked with finding solutions to problems affecting human beings and advancing other interests that promote the wellbeing of humanity. Though the authorities have taken a minor role in the running of many economic institutions, their failures have long-lasting impacts on leadership and its ability to retain power. For instance, many western countries have liberal economies that are largely run by the private sector. However, rising unemployment rates and declining production has often been blamed on the governments and public administration. This means that public administration still plays a key role in provision of essential goods and services despite the elevation of the role played by the private sector. The public administration is tasked with the responsibility of supervising both itself and the private sector. This means that generally, public administrators have more responsibilities and jurisdictions compared to private administrators.

Active involvement of the private sector in goods and service provision is usually necessitated by the diversification of the markets. Venturing into these markets often involves risks and requires resources that cannot be solely met by the government or other public institutions. The private sector has played a key role in alleviating poverty by identifying opportunities within the society and utilizing them. The sector helps in bringing together resources that are essential in wealth creation. In the course of utilizing the opportunities and resources, the sector creates income for households and goods and services for consumption by the people. Governments are keen on encouraging private investments to promote efficiency, give individuals incentives to create wealth and spread the risks associated with generation of goods and provision of services. Initially, many governments would establish industries and invest directly into various sectors. However, this proved to be a less effective venture due to competition from the private sector that is motivated by profits. Policymakers came to a realization that they could achieve better efficiency by encouraging private investments into the profitable industries.

Despite the shift from public to private sectors, stakeholders realized that there was need to maintain some institutions and sectors under the government. Some of the key reasons for this move was market failure. There are many instances where the market forces cannot efficiently meet the needs of the households. This exists where the private sector cannot retrieve profit gains from the venture. For instance, healthcare for the middle-class, underemployed and unemployed individuals cannot be provided efficiently by the private sector without government involvement. There is a need for medical services in this population. However, private investors are not willing to set up healthcare facilities targeting such populations because they are not guaranteed about returns on their capital. The government must thus come in to ensure that this population is catered for. Many countries in the world have public healthcare systems and governments are taking more active roles in the economy to ensure that they cater for deficiencies created by market failures and protect the population from exploitation.

Both the public and private institutions are key in social, political and economic development of a country. The Leadership of these two categories of institutions have many similarities due to common goals and some common features within their structure. One of the key goals that these institutions share is tendency towards sustainability. However, varying factors are emphasized in the course of achieving this sustainability. For instance, one key target of private institutions is returns on investment. On the other hand, the public institutions are driven by the common interest of the people that is translated into political will. The differences in the means and ends of the two categories of institutions have led varying approaches and structure of their leadership.

Distinctive Features of Public and Private Administration

Public administration makes decisions on the basis of political motives. Politics is a complicated phenomenon and political decisions are often affected by a combination of factors. They include beliefs, expectations and demands of various individuals or groups of people. The making of political decisions is often a complex process because the input of all the stakeholders must be considered. The public administrators tend to work under political scrutiny and direction. In many nations around the world, the head of the government plays a key role in the appointment of the public administrators and delegation of duties. Most of the people who head the government are elected by the people either directly or indirectly. This means that they must work hard to maintain a favorable image in the public. Image is key in ensuring that themselves or the parties that sponsored them to office retain power in the future election. They tend to make decisions that appease the masses. Therefore, the functioning of public administration relies on multiple sources of power and direction. These administrators can also be influenced by external powers. This influence can either be as a condition or coercion. For instance, public administration in many developing countries can be influenced by donors towards making certain decisions. In other cases, countries can use sanctions to persuade regimes into certain courses of action.

Private administration is usually influenced by a limited number of individuals. According to Waldo, it is for this reason that private administration tends to be more organized compared to public administrators. There is little or no political interference in private administration. Private administrators have time to fulfil their responsibilities with little interruption from external forces. Most of the time, the private administrators are only required to report or get scrutinized after a specified period of time or under certain conditions. For instance, stakeholders in a private company discuss its progress during AGMs or monthly meetings depending on their conditions. Financial reports of many private organizations are usually submitted annually, quarterly, sub-annually, monthly of after a specified period of time. However, public administration that is subject to political scrutiny can be asked to account for their operations at any time that those in power feel that it is appropriate. Lack of political interference in private administration has led to development of regular practice that has formed the culture of many entities.

The key function of public administrators is to put into force laws and policies formulated by the executive and legislative arms of the government. Therefore, these administrators hardly hold the final jurisdiction on the issues that they handle. They have limited discretion on the key issues. Top public administrators who head arms of the government such as the judiciary, legislature and the executive have more discretion compared to the junior people within the ranks of public administration. These top government officials make final decisions on what should be implemented by the rest of the public service. Most of the members of the legislature and the executive are usually elected by the people. Therefore, the laws, policies and decisions are made to resonate with the needs and demands of the population. Most of the key decision-making institutions such as presidency and the parliaments have political affiliations. Therefore, their decisions tend to favor the ideologies affiliated to the parties in power.

Public administration tends to be on a large scale. The decisions made by public administrators not only include the input from all relevant stakeholders but must also be implemented by at various levels. This means that the process or arriving at decisions as well as implementing them is complicated. Many public administrators handle matters that affect the larger population. This means that the people must be consulted either directly or indirectly through their leadership. Once the decisions have been made, they must also be communicated. The communication process subjects such decisions to distortion. The scale on which public administration functions tends to affect its convenience, especially for centralized systems where decisions have to be made at the top. The centrality means that all the available information must be channeled to a central power that then uses it to arrive at certain decisions. Often, the decisions and actions of public administrators meet resistance and criticism. The decisions and actions of public administrators are usually aimed at benefiting the people. Therefore, any input, criticism or resistance must be given attention. Public administration faces a lot of challenges due to the scale on which the decisions are made and implemented. The multiplicity of goals is what draws criticism from the masses. For instance, when implementing an infrastructural project, the stakeholders must strike a balance between its economic significance and the social costs. On the other hand, the private administrators will mid less about the social costs and concentrate on the economic implications.

Private administration tends to be on a relatively smaller scale in relation to public administration. This makes the process of decision-making more efficient. It is also easier to involve all stakeholders in the decision making. For instance, a company can bring together its employees, stakeholders and the management in one meeting and take the views of the individuals or their representatives before arriving at a decision. This makes private administration more inclusive. The inclusivity acts as a motivation to stakeholders to work towards meeting the goals of the entity. It also promotes organizational citizenship where individuals have a sense of belonging and are loyal to the overall management. The decisions made by private administration is usually based on a limited number of objectives. Most private organizations are profit-oriented. Therefore, the administration will concentrate their decisions on their profit maximization goals and are less likely to be distracted by other issues.

The private sector is mainly driven by the profit motive. Individuals can only invest their money in locations or ventures with the least opportunity costs. This means people with money that can be converted into capital will tend to search for better opportunities. Currently, capital is a very mobile factor due to globalization. Economies that offer better investment opportunities have seen growth in both direct and portfolio foreign investment. Those with less opportunities have seen outflow of capital and other factors of production like human resource.

The ends of private administration are personal. This means that the administrators are less likely to be concerned about the social implications of their decisions. Most private administrators are concerned about profits. The likely profits are used to gauge whether a firm is economically viable and sustainable or not. Goods and services are rendered to the public incidentally. This means that these utilities can only be availed when they generate income for the business. The firm can stop providing them if they become unprofitable despite their essentiality.

Conclusion

Public administration is fundamentally different from private administration. The ends of public administration are public. This means that its aspirations and goals encompass the benefit of the larger population. This makes public administration a very broad activity with various objectives that encompass social, political and economic issues affecting the public. On the other hand, the ends of private administration are usually personal and mainly encompass meeting economic objectives. Public administration tends to be more complex because of the essentiality of the utilities that it provides, a complex structure to cover wide areas, wider goals and high expectations from the people. Private administration mainly focuses on the profit goals of the government and services to the people are only incidental because they are essential in the attendance of the original goal.





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