I: Introduction and Context

Public Sector Reform and Performance Management in Developed Economies: Outcomes-based Approaches in Practice: An Overview

Zahirul Hoque


Over the past two decades, governments worldwide are increasingly focusing on being community-centric and outcomes-based (Hood 2002; Rana et al. 2019). Consequently, they are starting to move toward outcomes-based approaches to financial and management control systems in government agencies. The recent literature suggests how an outcomes-based approach allows the government or public service agencies and specific program areas to organize and communicate priorities to achieve what matters and make a difference rather than just going through the motions. According to Perrin (2006, 6), “An outcome focus potentially can provide a framework for an integrated ‘whole of government’ approach involving the coordination of different policy and program areas that are all expected to contribute in some way to the same outcome, such as employment creation, economic development, or the improved health of the population.”

This research-based edited book is a collection of chapters aimed at covering outcomes-based approaches from a selection of developed economies within both Westminster and non-Westminster models of government. Chapters from these countries on the topic written by renowned scholars will identify important issues pertinent to those interested in public sector governance, accounting and accountability, and effectiveness. The book’s content will be highly accessible to accounting, public administration, development studies, and other non-accounting audiences alike. The outcomes-based approaches in practice within developing economies will be covered in a separate volume.

In Hoque, Z. (ed) (2021), Public Sector Reform and Performance Management in Developed Economies: Outcomes-Based Approachesin Practice, New York: Routledge (Chapter 1).

4 Zahirul Hoque New Public Management

In the public sector, interest in performance measures has grown enormously as evidenced by the large literature on New Public Management (NPM), benchmarking and balanced scorecards (Hoque and Adams 2011). The approach of UK Conservative governments of the 1980s and 1990s to public service reform is often referred to as NPM (Hood 1991, 1995). NPM is the most recent paradigm change in how the public sector is to be governed (Lane 2000). In contrast to the long-standing importance of rule compliance, NPM emphasizes managing for outcomes (Hood 1995; Hoque and Adams 2011; Lapsley 1999; Lapsley and Miller 2019). The increased attention on performance measures and management by public sector managers, consultants, and academics reflects the increased pressure on public sector organizations to improve performance to remain viable in today’s competitive and global operating environment (Hoque and Adams 2011). “NPM” doctrines advocate accountingization, which encompasses the introduction of commercial accounting practices such as accrual budgeting and key performance indicators. NPM encourages such managerial and commercial approaches to government entities and emphasizes managing for outcomes over simply rule compliance (Hood 1995). The public sector administration and management literature (e.g. Hood 1995) identifies several elements of NPM (see Box 1.1).

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