They'll have to manage

In preparation for government, a Labour team went back to school to learn the lessons of management in the private sector. Keith Ruddle reveals the results

In recent years, the introduction of management machinery and language into the public sector has been the subject of much discussion and some criticism - not least at the BBC.

To many people, the world of financial regimes, performance indicators and management accountability has replaced, regrettably in their view, the old ethos of public service.

In a recent Harvard Business Review article, Henry Mintzberg, a Canadian academic, castigates the public sector for introducing Management (with a capital M) without due thought to its different and complex ethos. One major assumption, he argues, is that activities can be separated and measured and that their accountability can be entrusted to professional managers. This approach, he says, suggests control and efficiency but can also lead to a loss of higher public objectives.

Our view about applying the lessons from the private sector is more optimistic.

Last year, some 90 people - members of the Shadow Cabinet and their teams - came to Templeton College, Oxford, for a series of management sessions as part of their preparation for government.

The programme, part of a joint initiative by Templeton and Andersen Consulting, was designed with a strong emphasis on the working of departmental teams. Groups of 15 to 25 each came twice to the college and looked at topics ranging from the role of ministers, to the workings of the civil service, recent changes in the machinery of government and initiatives such as the setting up of agencies and the Private Finance Initiative. Case studies on past policy implementation were also included.

To make discussions as realistic as possible we called on politicians with previous ministerial experience, including Denis Healey, Roy Hattersley, Gerald Kaufman and Alan Howarth, and former senior civil servants including ex-permanent secretaries and Elizabeth Symonds, former head of the First Division Association. We also invited John Towers, then chief executive of Rover Group, who brought experience of leading change in the private sector.

What can be learned from the experience? A number of issues emerged - to do with the relevance of management to government and the challenges facing an incoming Labour government.

We looked at companies, including Rover, British Airways and SmithKline- Beecham, that have undergone dramatic change but where the leaders have not been motivated simply by a drive for greater efficiency. Rather, their aim was to infuse their organisations with a new vision - something which transcends financial targets - and, in turn, to evolve new cultures and ways of working.

In these cases and others, while management approaches with a capital M might have played a part, the overriding style and ethos generated by leaders was about inspiring people to strive towards a higher goal. Paradoxically, it is this approach that is often identified with the best public sector organisations.

But can politicians really benefit from management education and training? Today there is a clear recognition in most organisations of the benefits of custom-built training designed to match the objectives and the style of the participants. While politicians are clearly different in many important respects from business executives, when moving into government they have to take on new roles and assimilate skills and knowledge just as rapidly as any new CEO.

One MP on the Templeton programme said: "This is the first training of any kind I have experienced in the 20 years since becoming an MP." If true, then Parliament remains one of the last bastions where no value is perceived in professional development.

We would certainly agree that political skills are learned and honed at the sharp end. But the professional governing skills of any future minister can benefit from training which complements the practical but limited approach of "learning by doing".

Many pundits, ex-ministers and ex-permanent secretaries have set out golden rules for new ministers. Gerald Kaufman, among others, provides admirable advice to reassure the new minister that "you are the boss" and that "civil servants are there to serve you". Much current advice, however, warns new ministers off "hands-on management" and urges them to remember instead that they are the politicians - or, to quote Alistair Darling, "We're not there for our managerial skill but to bring judgement and vision to the process".

From looking at the cases and listening to the debate during the programme, we believe that there is no such conflict. We see no reason why a minister cannot remain a politician while strengthening the leadership and team- building skills necessary to inspire and influence change in the department and among stake-holder groups affected. Indeed, we would argue that without them significant change is impossible.

The differences between opposition and government have been well rehearsed. It is often said that in opposition one wakes up thinking, "What am I going to say today?" but in government thinking, "What am I going to do today?" Oppositions focus on attacking and campaigning. Governments, on the other hand, while also needing to defend and promote their position, have to implement an agenda.

Many observers say that a new minister can best be prepared by "going into government with a sense of the two or three things you really want to achieve". But equally, the skills of policy execution and departmental management have to be understood and learned.

We would argue that in addition, applying lessons from the private sector about the fulfilment of a radical change agenda represents an important opportunity for an incoming government, of whatever colour. For any new government the first challenge will simply be to get to grips with the machinery of state and keep on top of the day-to-day brief.

But if we are to believe Labour rhetoric, the supporters of a new government will expect more - substantial change and radical reform according to a new vision. In our view, ministers could learn much from leaders in other fields who have successfully pursued major programmes of transformational change in their organisations.

Policy goals may well be achieved by the effective use of existing mechanisms, but there will be substantial barriers to overcome in terms of organisational culture. The past 18 years have left their mark. Imported managerial mechanisms have bred a harsher and more individualistic public sector culture. Civil service behaviour has become increasingly geared to the drive for efficiency and to measurement by performance indicators. Team approaches and higher level public service values may have taken second place.

Add to this evidence of some problems with morale and motivation, and an incoming government faces a significant challenge in giving a new orientation to the culture of the public sector.

Ideas such as social justice, the stake-holder economy and welfare-to- work, for example, transcend existing boundaries. To make them a reality it will be vital to create "ownership" and teams that can work together effectively towards a common purposen

The author is an associate fellow of Templeton College, Oxford.