Academic journal article Public Administration Review

The Pursuit of Managerial Entrepreneurship: Does Organization Matter?

Academic journal article Public Administration Review

The Pursuit of Managerial Entrepreneurship: Does Organization Matter?

Article excerpt

Responding to managerial developments in the private sector, scholars and practitioners in the public sector have recently paid much attention to the managerial entrepreneurship models under which organizations pursue enhancement of customer satisfaction, reduction of red tape, and promotion of risk-taking activities. Entrepreneurship is often hailed in the public sector as a means of achieving more efficient, flexible, and adaptable management in a turbulent and competitive environment. This emphasis may lead to intensive and extensive innovations in the management of the public sector (Wart, 1995). This study attempts to understand what characteristics of organizational structure, culture, and environment potentially lead to development of managerial entrepreneurship. Using the data collected by the National Administrative Studies Project (NASP), an empirical analysis is conducted to examine the associations between organizational factors and managerial entrepreneurship.

The notion of entrepreneurship has been rapidly transferred from the private sector to the public sector without appropriate adjustments or conceptual clarifications. The term "entrepreneur," coined by Richard Cantillon and later popularized by French economist J. B. Say in the early 1800s, originally referred to "merchant wholesalers who bear the risk of reselling agricultural and manufactured produce" (Baumol, 1993, 12). Later it represented the individual who "shifts economic resources out of an area of lower and into an area of higher productivity and greater yield" (Drucker, 1985, 21). In the public sector, meanwhile, entrepreneurship often represents "public enterprise," a hybrid of public and private organizations that is considered to be a more efficient organizational form for some government programs (Thomas, 1993, 474).

Students of public administration are increasingly examining the value of entrepreneurship as an alternative means of promoting managerial improvement and introducing market-like competition in the public sector (Lewis, 1980; Doig and Hargrove, 1987; Osborne and Gaebler, 1992; Gore, 1993; Peters and Savoie, 1995, 1996; Johnston, 1996; Seidenstat, 1996). In the public sector, contractual entrepreneurship and managerial entrepreneurship are often discussed. Contractual entrepreneurship describes market-based government activities that attempt to introduce market competition and promote contractual relationships in the public sector (Halachmi and Nichols, 1996). Contractual entrepreneurship includes government franchises, privatization, cross-services, and contracting out. Managerial entrepreneurship broadly refers to managerial as well as properties that promote innovations and changes that improve performance with respect to organizational products, processes, and behaviors. Managerial entrepreneurship has been explored under various theoretical frameworks, including the new managerialism (Pollitt, 1992), the new governance paradigm (Ingraham and Romzek, 1994), and the post-bureaucratic paradigm (Barzelay, 1994).

Despite numerous practical and prescriptive discussions of managerial entrepreneurship, little research has been conducted that develops a theoretical model of entrepreneurship and shows empirical results. Moreover, little effort has been made to clarify differences in managerial entrepreneurship between the public and the private sectors. Consequently, fundamental confusion and conflicting approaches exist with respect to the nature of entrepreneurship (economic, contractual, and managerial entrepreneurship), administrative values and ethics (deLeon, 1996), administrative models (Moe and Gilmore, 1995) and expected outcomes of entrepreneurial government (Coe, 1997). This presence of confusion and conflicting approaches reflects the fact that entrepreneurship is not always viewed as a positive direction for public organizations. The negative perception arises partially because entrepreneurship has multiple attributes and is not well defined. …

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