INTRODUCTION
Today’s twenty-first-century public leaders and managers are increasingly involved in cross-sector collaborations (CSCs)—a transformation of public governance as important as the one that began over a century ago. In the late nineteenth and early twentieth century, the United States evolved from a nation of small governments, largely managed through patronage, to a large public sector, run by professional civil servants. This increase in professionalism led to the development of schools of public administration and public policy, the creation of the senior executive service at the federal level of government, and the development of a bureaucratic model of management and accountability that until recently has gone unchallenged. A similar public sector development also occurred internationally, especially in Western nations.
Beginning in the 1980s, however, the traditional public administration orthodoxy was challenged in the United States and abroad. The challenge came from a mix of political and academic actors who felt that the public sector that had evolved by the 1980s was inefficient, oversized, and unresponsive. They argued for more private sector involvement and innovation in the delivery of public goods and services and the unfettering of the public sector bureaucracy to become more flexible and innovative. The debate over the wisdom of this movement, often labeled the New Public Management, continues. The reality, however, is that the public enterprise of today increasingly relies on third parties (states, private firms, and nonprofit organizations) to deliver services to the American public (Salamon 2002).
This book is designed for those who want to learn more about these forms of collaboration and for those in the public and nonprofit sectors who will increasingly find themselves involved in a variety of collaborative arrangements—contracts, partnerships, networks, and other independent relationships—as they fulfill their public and nonprofit missions. The private sector also will benefit from understanding how public managers approach collaborations and the options and practical trade-offs they face.
THE CHANGING NATURE OF THE PUBLIC ENTERPRISE
The nature of this broader governmental environment, what we label the “public enterprise,” has fundamentally changed since our nation’s founding.1 While government remains at the center of the public enterprise, today it also encompasses a variety of private and nonprofit actors engaged in public service activities. This emerging dynamic requires us to rethink the basic governance structures and relationships within the public enterprise.
Government in the United States during the time of the constitutional debates was largely patterned after colonial administration. The major functions of government, such as the courts and the militia, were performed by people in their respective state or local governments (counties, parishes, or shires). These were farmers, lawyers, professionals, and laborers who supplemented their income through their government appointments. There was no such thing as a permanent civil service, which did not emerge in Western nations until the late 1800s. Government administrative appointments in the United States during its first century were largely based on whom you knew, not on your own skills.
At the time of the nation’s founding, there was a blurring of distinctions between the public and private sectors. Government jobs were often part-time; associations of neighbors worked together to create “public” infrastructure; and private parties developed toll roads and canals to facilitate both public and private transportation. As the nation developed, and especially after the Industrial Revolution, the indistinct dividing line between the public and private sectors created significant problems. Major parts of the economy were unregulated and unsafe; urban areas were run by political machines whose supporters were rewarded with public jobs or contracts. In the late 1800s, there was a growing realization, reflected in the Progressive movement, that the nation needed a clearer distinction between the roles of the two sectors, and Progressive forces argued for the development of a professional civil service to manage the public’s business. The professionalization of public administration began at the local level, but was then spearheaded by the federal government, which created a federal civil service system in the Pendleton Act of 1883.
The size of the current public enterprise as we now know it is primarily a result of the growth of the national government during the twentieth century, particularly during the Great Depression, World War II, the Cold War, and the Great Society eras that followed. National government spending as a percentage of gross domestic product rose tenfold from under 2.5 percent in 1930 to more than 25 percent in 2010. During this period, there was a dramatic increase in public employment through the development of professional civil service systems. However, federal civilian employment growth in the latter part of the twentieth century was limited by Congress through ceilings on full-time employees and the congressional practice of shifting the implementation of federal programs to state governments or federal contractors. There were actually fewer federal employees in 2009 than in 1980, even though federal government spending grew from $678 billion to $3.5 trillion. Even when new federal departments were created, such as Energy and Homeland Security, the employee ceilings meant that those new departments largely relied on private contractors to fulfill their public mission.
THE CURRENT STRUCTURE OF THE PUBLIC ENTERPRISE
The evolution of the current public enterprise over the last half of the twentieth century can be explained by five elements: the shift of actual program operations (to the extent possible) to state governments; the use of private and nonprofit contractors to perform any function that is not “inherently governmental”; the growing use of public-private partnerships to address public problems and needs, especially in the infrastructure area; the development of networks of public service providers that include private and nonprofit actors; and, finally, the growth of independent actors, composed of private and nonprofit organizations, which we refer to as independent public-services providers (IPSPs), delivering public goods and services. Four of these five trends involve cross-sector collaboration.
Government and the Expanding Public Enterprise
The result of devolution, contracting, partnerships, and networks is a public enterprise that is much different from the one that developed through most of the twentieth century. Some have labeled this the “hollow state” (Goldstein 1992; Milward and Provan 2000) because of the increasing inability of the government to effectively manage the public enterprise. Others have referred to it as the growth of “third-party government” (Salamon 2002) or “the market state” (Bobbitt 2002). Proponents and opponents have lined up to praise or decry these developments, but there is no doubt the public enterprise has dramatically changed.
In the latter half of the twentieth century, public governance included an expanded role of nonprofit organizations in providing public goods and services and the emergence of a private market for providing goods and services, from prisons to roads (Savas 2000). Despite the growth of networks and partnerships, the formal structures of government and how it is organized have remained largely unchanged, and yet the role of the public manager has changed significantly over that same period of time.
Public-Private Partnerships, Networks, and Independent Public-Services Providers
The focus of this book is on various collaborative arrangements—contracts, networks, public-private partnerships, and what we are labeling independent public-services providers—as vehicles for government action. IPSPs are a natural extension of a more networked delivery of services. They are self-directed entities composed of businesses and nonprofit organizations that collaborate, sometimes with government, in the production or delivery of public goods and services.
Government (federal, state, and local) remains at the heart of the public enterprise and continues as the dominant but not sole actor. Also included within the public enterprise sphere are contractors that generally operate within a governmental framework as agents of government. However, in contrast to contractors, partners and networks are sometimes within the governmental framework and at other times act with greater discretion and autonomy. Government must negotiate with other principals in networks and partnerships over the nature, scope, and delivery of public goods and services. IPSPs, the most independent of these organizational options, are created without any government involvement at all.
Governmental action is now largely framed through bureaucratic structures that dominated government activity for much of the twentieth century. The bureaucratic model works well in fairly structured situations, where problems can be compartmentalized and commanded by single governmental agencies, but that is not the nature of many of today’s critical problems and issues, such as climate change and health care cost reform. Instead, public servants must look to multiagency, multisector solutions that involve multiple organizations in a network of policy actors and implementers, or IPSPs, which are much different from the current government bureaucratic hierarchy.
This cross-sector world involves collaboration and mutuality and is organized around heterarchy rather than through the traditional government hierarchy. This heterarchy requires a different type of leadership and public management than the existing model does (Kettl 1997; Kee and Newcomer 2008). Instead of a public administration based on hierarchical notions of accountability, public servants must negotiate agreements with a variety of actors, with whom they may have little leverage or no direct control, but instead are connected through contractual or ad hoc arrangements in horizontal relationships that involve the development of reciprocal trust and mutual accountability.
ORGANIZATION OF THE BOOK
The book is organized into two parts and twelve chapters. Part 1 of the book, “Choosing Cross-Sector Collaboration,” delineates the various forms of CSC—their advantages and disadvantages—and provides a framework to analyze their use in solving public issues or problems. Chapter 1 discusses the challenges to public managers and the current complicated governing environment, including political, social, and economic forces that are driving CSC. It describes the types of organizations that are emerging to address problems that traditional governmental structures seem unable or unwilling to address. It also introduces the concept of the IPSP.
Chapter 2 examines the rationale for the growing use of CSC by all sectors and provides a template for engaging in a more strategic approach to CSC. This chapter draws a clear distinction between government activity in a principal-agent environment and government negotiations with other principals in collaborative contracts, networks, partnerships, or IPSPs.
Chapters 3 through 6 examine the primary CSC modes: collaborative contracting, partnerships, networks, and IPSPs. Each of the chapters defines a form of CSC, examines its rationale, and provides specific examples and a framework for public managers to engage private and nonprofit actors in delivering public goods and services.
Chapter 3 covers contracting and examines how contracting is shifting from the traditional or classic contracts to contracts that require more interaction between government and the contractor. We are labeling these types of incomplete or relational contracts “collaborative contracting” to differentiate them from the more traditional type. In this chapter, we also provide a detailed assessment process for all types of contracts.
Chapter 4 covers partnerships with nonprofits and public-private partnerships: we use the term cross-sector partnerships when discussing both. Governments are increasingly engaging in partnerships with both the nonprofit and the private sectors. The nonprofit actors are particularly important in delivering a variety of health care and social services. Private organizations are seeking and entering into public-private partnerships, particularly to address public infrastructure needs. The chapter provides a framework for public managers to effectively engage partnerships.
Chapter 5 deals with network organizations, including their functions, types, and structures. These are illustrated through a variety of examples and case studies. Public managers are provided with a framework for working effectively with networks that deliver public goods and services.
Chapter 6 further explores the concept of IPSPs, addressing their growing use and potential as legitimate actors in the delivery of public services. It provides examples of IPSPs addressing the critical challenges raised in chapter 1.
Chapter 7 proposes an analytical framework for assessing these new forms of governance and when they should or could be used in particular situations or to solve particular problems. Using case studies, the chapter explores critical issues such as the nature of the public task or challenge, the location of necessary resources to address the challenge, the identification and allocation of risks, the analysis of best value for the public, and the importance of measuring performance and ensuring appropriate accountability.
The chapters in part 2, “Managing Cross-Sector Collaboration,” examine a number of implementation factors that influence the effective use of CSC by public managers. They describe the current state of public administration with respect to these new forms of CSC governance and identify the stewardship and leadership requirements when public managers engage cross-sector collaborators.
Chapter 8 examines the current bureaucratic form of public administration, providing arguments in favor of and against the current model. The chapter argues for the need for a new model for the evolving heterarchy of actors. Chapter 9 describes the leadership requirements of public managers when working in a heterarchy rather than a hierarchy and examines techniques for public managers to coordinate the contributions of nonprofit and for-profit organizations in public service.
Chapter 10 stresses the importance of developing a system of mutual, democratic accountability and proposes approaches to achieve that accountability, providing public managers with four pillars to foster accountability in CSC. Chapter 11 discusses the need for public agencies to develop learning practices to improve their approaches to collaborating with the private and nonprofit sectors.
Chapter 12 concludes with a discussion of how we can close the governance gap by rethinking the role of public managers and the potential of increased action by the for-profit and nonprofit sectors. It addresses the key challenges for public managers, summarizes the advantages and disadvantages of CSC, and presents “public value” as an important consideration when assessing CSC success.
Within the chapters are various case studies, including a case study on state employment and training options, which will give readers an opportunity to apply concepts in the chapter to further understand choices available in CSC. Additional cases are on the book’s website, www.wiley.com/college/forrer.
Public managers today face a variety of choices for solving public problems and delivering public goods and services. These new cross-sector collaborative choices offer promise for improving performance but require a very different approach to management and leadership from the current traditional approach in government agencies.
This book is aimed at public leaders and managers who are responsible for the effective stewardship of the public enterprise and for their partners in the nonprofit and private sectors. It provides a blueprint for analysis and a framework for ensuring public accountability in the public interest. We believe it will be useful for both students and practitioners, who understand we are living in challenging times and desire to better understand different modes of action and governance.