'The Two Cultures Re-Examined: A Perspective on Leadership and Policy Management in Business and Government'

Business Asia, August 2008 | Go to article overview

'The Two Cultures Re-Examined: A Perspective on Leadership and Policy Management in Business and Government'


Telstra Corp is Australia's leading telecommunications and information services company. It offers a full range of services and competes in all telecommunications markets throughout Australia, providing more than 9.6 million Australian fixed line and more than 9.3 million mobile services, including 3.3 million 3G services.

Phil Burgess is Group Managing Director, Public Policy & Communications, at Telstra, where he is a member of the senior leadership team, and is responsible for public policy, regulatory affairs, government relations, media relations, corporate communications, and executive and business unit services.

Business Asia provides you with an edited transcript of a speech he delivered earlier this year to the Australia and New Zealand School of Government (ANZSOG) in Canberra on his experiences as a student of governance working in the academy and as a practitioner or clinician of the same working in the US, East Asia, Europe and Australia, and his observations about the key differences between the political cultures of the US and Australia as they relate to public policy making.

The two cultures of business and government

For a long time I have been fascinated by the decision-making environments of public administration and business administration. I believe the differences are much more important than the similarities.

These differences are many. For example:

1. Goal setting in the enterprise sector--to delight customers and reward shareholders--is relatively narrow compared to the comprehensive "public interest" objectives pursued by government.

2. Enterprise sector leaders almost always enjoy the support and encouragement of their policy board. By contrast, public sector leaders are nearly always opposed by a vocal segment of their policy board--the legislature--which tries to embarrass, trip up or otherwise undermine the authority and standing of the leader.

3. Enterprise leaders have enormous control over the decision process--the who, what, when, and how of decision-making. The CEO can decide who will participate on what issues at what time in what arena. Public sectors leaders do not have this kind of control. [1]

4. Enterprise leaders have substantial control over staffing and other "factors of production"; public sectors leaders are much more constrained in the hiring, sacking, and assignment of people.

As a result of these differences, there is a lot of room for misunderstanding between the wealth-creating institutions of society and the institutions of government. It is often difficult for the CEO and his enterprise leadership to understand and take account of the fact that the public sector leader typically needs:

* a public interest rationale (i.e., "cover" or an inspired or "creative" explanation) for doing something that involves or benefits the enterprise sector--because everything is public, the mission of the public sector is the public interest, and the public is often skeptical (not without reason) of government-business relationships. [2]

* time--because public leaders need to make sure key stakeholders are on board. This is a process that takes time, especially when some have a formal or informal "veto" power.

* occasions for decision (or decision situations) that bring distributed benefits (what the game theorist calls "side-payments") for relevant stakeholders--because the building and maintenance of coalitions require benefits (what the game theorist calls "pay-offs") for everyone participating in the winning coalition.

These decision making needs of the public manager--for a public interest rationale, time, and a distributed benefits to players beyond the buyer and the seller--are not a typical consideration to the "let's do it now" orientation of most enterprise leaders who value results and often devalue or don't understand process requirements of coalition building. …

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