Can Nonprofit Management Help Answer Public Management's "Big Questions"? (Big Questions/Big Issues)

Brooks, Arthur C., Public Administration Review

Introduction

Defining moments in academic disciplines often occur when their principal unanswered questions are specified. Such was the case with Robert D. Behn's frequently cited 1995 article in Public Administration Review, "The Big Questions of Public Management." In this article, Behn laid out what he saw as the three areas of inquiry with the potential to make public management most useful to the field and "scientific" in its method of inquiry:

1. How can public managers break the cycle of micromanagement, which inhibits public agencies from producing results?

2. How can public managers motivate people to work toward achieving public purposes?

3. How can public managers measure performance?

The relatively new field of nonprofit management saw similar contributions in 1993 and 1997 when Dennis R. Young, editor of Nonprofit Management and Leadership, defined the "key contemporary managerial and leadership issues facing nonprofit organizations." In his estimation, these issues are board governance, executive leadership, human resources management, development of financial resources, strategic adaptation to change, organizational structure, and performance measurement (see figure 1).

There is evidence that the nonprofit field journals have focused these issues well. For example, analysis of a sample of articles in the two most prominent nonprofit journals, Nonprofit and Voluntary Sector Quarterly and Nonprofit Management and Leadership, shows that 66 percent of the articles published in 1990-98 were devoted just to these seven areas. (1)

These areas in nonprofit management overlap considerably with Behn's big questions. Given that a significant literature addresses these areas, it stands to reason that the nonprofit management literature might be able to help inform public management practice and scholarship. I set out to make this case in this article. In the next section, I will review Behn's questions in public management and introduce the parallel questions in nonprofit management. Then, I will survey the main findings in nonprofit research that illuminate these questions especially well. Because my primary intention here is to make the case for the value of the nonprofit management literature to the academic or practitioner in public administration, I look at nonprofit research findings in far greater depth than those from public management. Thus, many important innovations in the latter field will receive short shrift. I assure the reader this is simply a function of focus and space, not of oversight.

Applying Lessons from Nonprofit Management to Public Management

The literature in three of these areas--board governance, human resource management, and organizational effectiveness--is especially well suited to illuminate Behn's questions. In these areas, nonprofit organizations often deal with "polar cases": those that exaggerate the particularly intractable elements of the issues seen in public management. I intend the following examples from the nonprofit literature to make this point. While the findings I outline from nonprofit scholarship do not represent an exhaustive literature review, they should give a flavor of the unique resource this literature represents for public management.

Nonprofit Board Governance and Breaking the Micromanagement Cycle

Micromanagement is a problem in the public sector that is primarily the result of what economists refer to as the "principal-agent problem." According to Behn, principals (such as elected officials) have trouble monitoring quality among agents (agency managers), resulting in extreme codification of behavior through legislation. This results in distrust, worse performance, more rules, and so forth. Natural extensions of this problem exist at a lower level in the public sector. For example, agency managers (principals) micromanage their employees (agents). Similarly, agency governing boards micromanage both public managers and their employees. In the absence of better techniques for

monitoring performance, breaking the cycle of micromanagement requires innovations to reduce mistrust and better define the proper roles of principals and agents at each level.

If there is an administrative hierarchy in which jurisdictions are more blurred than in the public sector, it is found in the nonprofit sector. The traditional role of nonprofit trustees provides an example: While nonprofit boards are responsible for high-level oversight of their organizations (as in the case of for-profit firms), they are also frequently called upon to perform functions that are arguably farther down the chain of responsibilities, such as fundraising, managerial coordination, and even volunteering (Oster 1995). That is, the principals are often agents themselves. (2)

This principal--agent confusion has spawned a body of literature on effective board governance that aids in defining the set of tasks and issues that are the most appropriate focus for trustees. For example, Stone (1991) shows that a board's understanding of organizational mission and its focus on high-level policy issues are associated with especially effective organizations. Green and Griesinger (1996) and Bradshaw, Murray, and Wolpin (1992) find the same thing, specifying a list of appropriate board tasks at the policy--not operational--level. Miller, Kruger, and Gauss (1994) show that effective boards tend not to be involved in the day-to-day administration of their organizations; rather, they intervene at lower levels and only in periods of crisis (usually in funding). These articles all …

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Publication information: Article title: Can Nonprofit Management Help Answer Public Management's "Big Questions"? (Big Questions/Big Issues). Contributors: Brooks, Arthur C. - Author. Journal title: Public Administration Review. Volume: 62. Issue: 3 Publication date: May-June 2002. Page number: 259+. © 1994 American Society for Public Administration. COPYRIGHT 2002 Gale Group.

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