Strategic Management in Public Services

Local Government Studies

ISSN: 0300-3930 (Print) 1743-9388 (Online) Journal homepage: http://www.tandfonline.com/loi/flgs20

Strategic Management in Public Services Organizations: Concepts, Schools and Contemporary Issues, Ewan Ferlie and Edoardo Ongaro, Abingdon, Routledge, 2015 ISBN 978-0-415-85538-9 (PB) Paul Joyce To cite this article: Paul Joyce (2015): Strategic Management in Public Services Organizations: Concepts, Schools and Contemporary Issues, Ewan Ferlie and Edoardo Ongaro, Abingdon, Routledge, 2015 ISBN 978-0-415-85538-9 (PB), Local Government Studies, DOI: 10.1080/03003930.2015.1103548 To link to this article: http://dx.doi.org/10.1080/03003930.2015.1103548

Published online: 03 Nov 2015.

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Local Government Studies, 2015

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Book Review

Strategic Management in Public Services Organizations: Concepts, Schools and Contemporary Issues Ewan Ferlie and Edoardo Ongaro Abingdon, Routledge, 2015, ISBN 978-0-415-85538-9 (PB) Strategic Management in Public Services Organizations by Ewan Ferlie and Edoardo Ongaro is positive about the prospects for strategic management in the public sector. The authors see strategic management as a growing field of research and practice, and they judge that strategic management ‘has the potential to further develop its contribution to both public administration as science and to the art and profession of the public administrator’ (11). The book’s early chapters outline eleven different schools of strategic management thought and offer a framework for understanding thinking about strategic management derived from the general list of ten schools provided by Mintzberg, Ahlstrand, and Lampel (2009). From Chapter 5 onwards the book is organised more thematically. Chapter 5 probes the applicability of the public sector literature to third-sector organisations and social enterprises. For example, the authors suggest that the entrepreneurial school of strategy (Mintzberg, Ahlstrand, and Lampel 2009) may be applicable to small recently founded not-for-profit and social enterprises. They mention public value analysis (Bennington and Moore 2010) in relation to larger not-for-profit enterprises. Chapter 6 puts forward the argument that context matters in strategic management. Ferlie and Ongaro contribute a discussion of a concept they say could be labelled ‘the strategic space’, and which leads into their exploration of organisational autonomy. The strategic space of an organisation depends on (1) its amount of organisational autonomy (which is the extent to which the organisation can decide its own goals and/or resources), (2) its orientation to strategic management and (3) political–societal expectations and obligations. They envisage these factors changing over time in non-linear ways. Citing a study by Carpenter (2001), the authors emphasise that autonomy is something that develops through a process. They introduce the idea of capacity building and associate it with strategic processes by suggesting it can be understood as a process of formulating and implementing organisational strategy. (This proposition could be seen as corresponding to versions of the core-competence perspective that suggest core competences are developed through organisational learning as businesses develop and market new products in line with a long-term industry foresight.) In effect, they seem to be saying that autonomy grows because an organisation’s capacity grows and its capacity grows through formulating and implementing strategy. They suggest (157): ‘Key ingredients in this autonomizing process of these agencies [studied by Carpenter] were the building of reputation for the agency (convincing key stakeholders that the agency delivers something uniquely valuable), setting up supporting networks, and ensuring continuity in the organizational leadership’. They also discuss the ideas of Vining (2011), which include the idea that autonomy for the public sector is a goal of strategy, in a way that is equivalent to

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the commercial sector pursuit of profit. Vining, they say, sees autonomy as a precondition for strategy making and also as a goal of strategy. In concluding their arguments about framing the context, Ferlie and Ongaro judge there is a need to make use of the schools of strategic management and case studies to identify the drivers of strategy. They consider that the drivers may be varied and warn against adopting a ‘global recipe’. This is because of the variations in context because of politicoadministrative factors. In Chapter 7, the authors tackle the important topic of the impact of strategy on organisational performance. While the chapter does decide that there is a link, their discussion shows it is not an easy conclusion. Ferlie and Ongaro give careful attention to research carried out over a long period of time, and they weigh up the findings of the book by Andrews et al. (2012) (175): The authors acknowledge that most of the hypotheses they formulated based on the Miles and Snow model . . . either did not receive support or for important part ran counter to the expectations . . . However, the main finding of the Andrews et al. research work is that in most instances the presence of a strategy – be it prospecting or reacting in stance and/or incremental or rational in the formulation and/or the implementation style – determines a higher level of performance than the absence of – a finding which corroborates the core argument put forward in this book (and in Andrews et al.’s book too): that strategy does matter in improving performance. Ferlie and Ongaro argue in favour of future research work into strategic management and performance being taken forward by making use of the schools of thought in strategic management. They do, however, point to the problem of linking strategy and performance in the emergent perspective advocated by Mintzberg and make an interesting assessment of process schools in relation to the study of strategy and performance (179): [They] provide powerful analytical tools for detecting how strategy actually forms in organizations, yet their emphasis is on differentiation and nuances that tend to make each individual case different, making it difficult to test the impact on actual performance, and even to identify the profiles on which to detect and measure performance. Indeed, in certain extreme versions the “contextualist” approaches to strategic management might even lead to reducing the “performance” of public services organizations and the “numbers” with which it is measured to “stories” . . . We would join Bouckaert in countering these forms of radical social constructivism, noticing that “[To] reduce public administration and its numbers to stories which construct realities is to ignore tangible bottom lines of policy problems such as poverty, health issues or security” (Bouckaert 2013, 85) They seem to be saying that process-orientated schools and radical social constructivism might be at risk of doing research and theorising that tries to understand reality without having any or much interest in solving the practical problems of the public. Ferlie and Ongaro, along with Bouckaert, might be seen as taking an engaged scholarship perspective, and thus they might be seen as critical of the radical social constructivists for (implicitly) rejecting a responsible role for research. Chapter 8, which is titled ‘The quest for excellence’, explores the very important practical issue of how learning is transferred from one context to another. The authors suggest a protocol for conducting what they call the process of extrapolation of practices. It consists of five steps: (1) identifying the function of a target practice (what is to be achieved by the practice), (2) defining the practice, (3) describing the practice, (4) identifying its effects and (5) identifying the contextual factors (which are the conditions

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Book Review

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in which the practice works). It will be noted that this protocol also features the importance of analysing the context. The fifth step is seen as critical for the transferability of the target practice because practices have to be adapted for new contexts that are different from the original one. The final chapter considers strategic management as both science and art. Ferlie and Ongaro raise questions that include whether strategy includes political decision-making or not, and who is the strategist (meaning, is it the administrator or the politician). The book is mostly concerned with understanding strategic management in organisational settings. But in this last chapter, with this question about the scope of strategic management, and the question about who is the strategist, there is a hint of a different framing of strategic management. Arguably, this last chapter, although still centred within studies of strategic management in organisations, is on the threshold of looking at the role of strategic management in public governance. In summary, this is a book that focuses on different schools of thought about strategic management. It addresses some very important topics: notably, the impact of strategic management on organisational performance and how lessons about successful strategic management can be transferred from one context to another. It stresses the need to look at the context of strategic management, and thereby points to a need to recognise that strategic management varies in practice. The book is, therefore, a warning against oversimplifying the nature of strategic management. Finally, it is a book that is upbeat about the future of strategic management as a subject of academic study and as a useful development in public administration.

References Andrews, R., G. Boyne, J. Law, and R. Walker. 2012. Strategic Management and Public Service Performance. Basingstoke: Palgrave Macmillan. Bennington, J., and M. Moore. 2010. “Public Value in Complex and Changing Times.” In Public Value: Theory and Practice, edited by J. Bennington and M. Moore, Chapter 1. 1–30. Basingstoke: Palgrave Macmillan. Bouckaert, G. 2013. “Numbers in Context: Applying Frege’s Principles to Public Administration.” In Context in Public Policy and Management: The Missing Link? edited by C. Pollitt, 74–87. Cheltenham: Edward Elgar. Carpenter, D. 2001. The Forging of Bureaucratic Autonomy. Princeton, NJ: Princetown University Press. Mintzberg, H., B. Ahlstrand, and J. Lampel. 2009. Strategy Safari. 2nd ed. Harlow: FT Prentice Hall. Vining, A. 2011. “Public Agency External Analysis Using a Modified ‘Five Forces’ Framework.” International Public Management Journal 14 (1): 63–105. doi:10.1080/ 10967494.2011.547819. © 2015 Paul Joyce Birmingham City University Business School http://dx.doi.org/10.1080/03003930.2015.1103548