Strategic management in Public sector organizations.

Principles and Practice of Management notes and Revision questions and answers

Although the elements of strategic management are broadly the same irrespective of the type of organization or its context, the range and nature of strategic issues does to some extent differ according to the organization type and its context.

In other words, it would be wrong to assume that, for example, all the elements of strategic management are equally important in all circumstances, or indeed that their application is the same in all situations. Some of the key differences are discussed below for each of the different types of organization and contexts in the question.

Strategic management in public sector organizations
Firstly it is important to recognize that the public sector itself comprises of a very wide and diverse set of types of business organization. In fact, the public sector comprises of a number of sub-sectors such as the nationalized organizational sector, government agency type organizations, and public service organizations such as hospitals, the police service etc. Each of these sub-sectors to some extent has its own special characteristics with regard to the application of the strategic management elements. However, recognizing this, it is possible to point to some of the general differences and special considerations which arise with regard to strategic management in the public sector organization.

Perhaps the main difference in this type of organization/context is the influence of political considerations and factors in the development of strategic plans. So, for example, public sector organizations are often constrained and/or directly influenced political considerations. A related issue is that public sector organizations are very much more accountable for their decisions to outside parties and indeed in the broadest sense, often to the public in general. Decisions managers in such organizations will often be taken in the context of such political/ regulatory requirements such as, for example, a requirement to buy from domestic suppliers.

Finally, public sector organizations are often very formal and bureaucratic and for this reason, may often be slow to respond to change.

Principles and Practice of Management notes and Revision



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