What is Public Value?
RELEVANCE
Public value is important to all of us, individuals and organizations.
In a world of distributed power, volatility, and disruptive change, centralized meaning making and overarching narratives are in crisis. More than ever, value is in the eye of the beholder as a web of meaning, purpose, and emotion. Paradoxical as it may seem, in a world of stubborn material conflict, more than ever we need to come to terms with soft issues.
The same goes for the agency of institutions: increasingly, cooperation is needed between the public, the public sector, and the private sector to help cocreate a functioning society with viable organizations and happy people.
We need to accept in a fundamentally new way that the rise of subjectivity is not a temporary phenomenon, but a profound challenge of top management. The reason is simple: the more complex organizational activities become in a global market, unless you can meet complexity with complexity. The reverse is true, that is, the less customers, citizens, and politicians understand the complex social, motivational, and ecological realities, the more they need to simplify their occurrences and rely on their emotional responses.As a natural response, humans feel positive about something if there is a direct personal gain or a positive impact on the community or society in which they live. Public value represents the subjective side of value creation, investigating its psychological underpinnings and providing measures and logic of value creation.
Some recent data from Germany and Switzerland (in parentheses) can illustrate this sanctuary:
- 87 (84) out of 100 recommended indicate that they have a fairly clear to very clear concept of public value.
- 81 (73) out of 100 excluded are reasonably concerned to very concerned that public value receives little consideration in Germany.
- 72 (78) out of 100 prefer to work for organizations that advocate public value at a high level, even if it means earning less.
- 92 (95) out of 100 believed that they can contribute to public value through their own behavior (53% voted 6 on a scale of 1-6)
- 91 (87) of 100 recommended indicate that they prefer products that benefit public value, even if it means spending more on them.
- 82 (86) out of 100 believe that private companies have a great responsibility to contribute to public value. Even more responsible are public administration (98%/96%), non-profit organizations (96%/93%), politics (95%/91%) and also for each individual (95%/95%), according to the respondents.
THEORY
It does not suspend the profit motive, but inquires about its legitimate cause in society and how it interacts with other values.
The concept of public value allows us to answer the question of whether an organization adds value to society and, consequently, what makes an organization valuable to society not just in economic-financial terms. Public value thinking is about a return of voice to the public. Basically, public value begins and ends with the individual.
Public Value theorizing is based on the notion of the common good and deals with the antecedents and effects of “calling a public into existence” (Dewey). In their well-received editorial book, Bryson, Crosby, and Bloomberg (2015) categorize the public value discourse into three main streams according to its main protagonists: Mark Moore, Barry Bozeman, and Timo Meynhardt.
The discourse was initiated by Harvard professor Mark Moore in the 1990s, he began in his seminal book (1995) by stating, “Public value is managerial success in the public sector by starting and reshaping public sector enterprises in ways that increase their value to the public in the short and long term.” As a response to the new public management reform and its austerity and efficiency measures that ultimately result in less state, Moore contrasted this prevailing paradigm with a proactive managerial concept for public servants whose ultimate goal is the creation of value for the public.
Barry Bozeman’s analytical approach to public values focuses heavily on the social level. Unlike Moore, Bozeman broadens the perspective on values – he does not distinguish between public and private with respect to the source of contribution. A major theme in Bozeman’s work is the analysis of public value gaps: public values that are unmet or undermined by public and private institutions.
The European tradition of public value originated at St. Gallen University with the work of Timo Meynhardt. He provides a solid theoretical foundation by rooting his concept of value in a psychological epistemology. Basic needs are the basis of any human valuation , they are the primary reference system for the world. Thus, human beings are constantly evaluating their environment with regard to the satisfaction of basic needs. In order to create value for the public or publics, individuals must realize a significant contribution to that larger entity evaluated on the basis of basic needs. Value creation is more of an experiential (subjective) category accompanied by emotional and motivational states rather than a purely measurable (objective) one. Thus, value resides in the relationship between a perceiving subject and a contributing entity. Public or private organizations, goods and services must meet these needs to create public value.
PRATICAL
The concept of public value offers a solution to the difficulty of systematically absorbing and managing society’s expectations. It also helps establish a perspective that sees organizations as positive forces in society. Public Value is a way of seeing the world. Practicing the art of public value leadership requires will and skill.
Similar to the emergence of customer satisfaction, public value measures require internal partners who use the results to improve their own daily operations. In practice, we see a number of different justifications that companies offer for wanting to increase their public value. These rationales generally fall into three categories:
- Prevent – what we should stop doing
- Identify – what we should keep doing
- Explore – what we should start doing
Organizations have two frameworks or tools to measure, analyze, and understand public value challenges in depth:
The Strategic Triangle (Moore)
Moore’s (1995, 2013) strategic triangle is an analytical framework that focuses on value creation opportunities and empowers public servants as agents of society. The framework consists of three elements-the triangle in which public managers must navigate-each pointing to a particular set of observations, calculations, and judgments that managers must make to formulate a strategy for public value creation. Moore later went on to call an extended version of this scorecard the public value triangle.
- Public value describes the changes in individual and social conditions that a public manager is charged with making. The public manager has to provide an account-both a story that can create meaning and a set of measures-that can empirically recognize the value he seeks to produce.
- Legitimacy and support refer to the authorizing environment that controls the resources, i.e., financial assets and authority necessary to support the organization’s efforts to make valuable changes in the social condition.
- Operational capability refers to the administrative means and assets that make the strategy operationally feasible, i.e., expertise and capacity. Therefore, it concerns the managerial question of how the assets can be deployed to produce the desired results and whether the organization is actually able to meet its objectives.
The Public Value Scorecard (Meynhardt)
- “Is it useful?” – utilitarian-instrumental values
- “Is it decent?” – ethical-moral values
- “Is it politically acceptable?” – politico-social values
- “Does it allow for positive experiences?” – hedonistic-aesthetic values
- “Is it profitable?” – economic-financial values
BIBLIOGRAPHY
Beck Jørgensen, T. & Bozeman, B. (2007). Valores públicos. Um inventário. Administração e Sociedade, 39 (3), 354-381.
Benington, J. & Moore, MH (2011). Valor público: teoria e prática . Palgrave Macmillan.
Bryson, BC Crosby & L. Bloomberg (Eds.), Valor público e administração pública . Washington: Georgetown University Press.
Lindgreen, A., Koenig-Lewis, N., Kitchener, M., Brewer, JD, Moore, MH, & Meynhardt, T. (Eds.). (2019). Valor Público: Aprofundando, Enriquecendo e Ampliando a Teoria e a Prática . Routledge.
Meynhardt, T. (2009). Valor público interno: O que é criação de valor público? Jornal Internacional de Administração Pública 32 (3-4), 192-219. Download
Meynhardt, T. (2015). Valor público: interagir uma estrutura conceitual em um scorecard. Em Bryson, BC Crosby & L. Bloomberg (Eds.), Valor público e administração pública . Washington: Georgetown University Press, 147-169. Download
Meynhardt, T., Brieger, SA, Strathoff, P., Anderer, S., Bäro, A., Hermann, C., … & Gomez, P. (2017). Desempenho de valor público: o que significa criar valor no setor público?. Em Administração do setor público em um mundo globalizado (pp. 135-160). Springer Gabler, Wiesbaden. Download
Meynhardt, Timo (2019. Valor público: criação de valor aos olhos da sociedade. In Valor público: aprofundando, enriquecendo e ampliando a teoria e a prática . Routledge, 2019, S. 5-22. Download
Moore, MH (1995). Criação de valor público: gestão estratégica no governo . Cambridge: Harvard University Press.
Moore, MS (2013). Reconhecer o valor público. Harvard University Press.
O’Flynn, J. (2007). Da nova gestão pública ao valor público: mudança de paradigma e administração gerenciais. Jornal australiano de administração pública, 66(3), 353-366.
Stoker, G. (2006). Gestão de valor público: uma nova narrativa para governança em rede?. A revisão americana da administração pública, 36(1), 41-57.