JRSSEM 2023, Vol. 02 No. 9, 1911 – 1919
E-ISSN: 2807 - 6311, P-ISSN: 2807 - 6494
DOI : 10.59141/jrssem.v2i09.419 https://jrssem.publikasiindonesia.id/index.php/jrssem
NEW PUBLIC MANAGEMENT CRITICAL RIVIEW
Lukman Arif
1
University of National Development Veterans East Java, Indonesia
*
Email: lukmanarif@gmail.com
*Correspondence: lukmanarif@gmail.com
Submitted
: March 05
th
2023
Revised
: April 04
th
2023
Accepted
: April 13
th
2023
Abstract: The emergence of various criticisms directed at public sector organizations eventually
gave rise to a public sector management reform movement, namely the concept of New Public
Management. In the NPM concept, all leaders or managers are encouraged to be able to find new
and innovative ways to get maximum results or to privatize government functions. This research is
part of a qualitative research using a systematic review approach. Systematic review is a method
that uses previous evidence-based evidence through review, evaluation, structured evaluation,
classification and categorization. Because the steps and strategies for carrying out a systematic
review are well planned and structured, this method is very different from the method used only
to convey literature studies. Based on the results of the analysis that has been carried out, several
things that have become critics regarding the implementation of NPM are: 1) decentralization can
have a negative impact on community participation, especially in social policies. 2) Refers to the
application of management techniques from the private sector to the public sector. Many academic
commentators such as Pollitt (1990) and Armstrong (1998) argue that most fields of public service
and administration have distinct political, ethical, constitutional, and social dimensions, and that
these factors make the public sector different from the private sector. 3) National culture influences
the implementation of NPM. Another factor to consider is national culture, which means that NPMs
can be very suitable for governance reform in developed countries, but in developing countries,
NPMs can lead to more corrupt governments due to deficiencies in fulfilling the principle of
accountability. 4) Institutional Issues Challenges in implementing management Modern society in
the country emerged as a result of institutional problems, lack of law enforcement, capital, and
human resource capabilities. In addition, developing countries continue to implement reforms that
are unrelated to or even contrary to the goals of the NPM. Packages on the NPM agenda have not
been fully executed.
Keywords: New Public Management; Critical Review; Public service; government.
Lukman Arif | 1912
INTRODUCTION
Essentially the goal of reform is to
improve public sector performance and
increase transparency and accountability.
More broadly, this is a manifestation of the
desire towards good governance. The
implementation of Good Corporate
Governance in company management is
very important because it can directly
provide clear guidance in making the right
and responsible decisions and enable safer
company management so as to increase
the value and trust of partners or the
community (Kristanto et al., 2021) . These
days, public sector organizations are often
portrayed as unproductive, inefficient, of
low quality, and lacking innovation or
creativity. The emergence of various
criticisms directed at public sector
organizations finally gave rise to the public
sector management reform movement,
namely the concept of New Public
Management. In the NPM concept, all
leaders or managers are encouraged to be
able to find new and innovative ways to get
maximum results or privatize government
functions. They no longer lead by sweeping
all work (rowing), but by "directing" which
means controlling, leading, and also
directing strategic things only ( Sri Hartati,
2020).
The concept of New Public
Management is one that is offered in the
management of public sector activities in
Indonesia. The term New Public
Management, known in the 1980s,
underwent several changes and then
regained popularity around the 1990s. This
is interpreted as an alternative in managing
public sector organizations that have been
considered less successful (Hening &;
Kumara, 2019). In general, changes in the
implementation of New Public Management
aim to: (1) increase efficiency in the public
sector, (2) increase the responsiveness of
public sector institutions to clients (society),
(3) increase accountability in the public
sector, stated by (Business, 2020) The main
target of the New Public Management
model is the organization and emphasis on
the economy and efficiency of service units
in the delivery of public services. New
Public Management as a moderation
variable. Demonstrate a performance
measurement system with the type of
monitoring and centralization that directly
affects organizational performance. In the
same vein noted that NPM has brought
cost-effectiveness and service effectiveness
benefits to public management, as well as
increased efficiency and value for money by
focusing on performance management and
auditing. Other observers also believe that
NPM encourages governments to focus on
efficient production of quality services. In
addition, NPM replaces a highly centralized
hierarchical organizational structure with
decentralized management because NPM
involves restructuring and streamlining the
public sector, including reorganization and
streamlining of the central civil service
(Minogue, 2001b). New criticism of public
management.
NPM has three main components,
namely incentives, competition, and
disaggregation. Incentives emphasize
performance-based payment systems and
mandated contracts. Incentives are also
correlated with meritocracy, as a way of
distributing income, power, wealth,
opportunity, honor, and social recognition
1913 | New Public Management Critical Riview
based on what they deserve (David &;
Amey, 2020) in Indonesia , the New Public
Management (NPM) approach that has
been applied in Indonesia since 1999 with
the issuance of Presidential Instruction
(Inpres) Number 7 of 1999 concerning
Accountability of Government Agency
Performance. NPM is an approach that
seeks to change the rigid, slow, and
inefficient bureaucracy by importing
private business concepts, techniques, and
values, so that the government can provide
effective services to citizens, and also
emphasizes efficiency (EGAWATI, 2022).
(Business, 2020) states that NPM has
performed its duties and various elements
of NPM are stopped or withdrawn quickly.
Instead, they see DEG as the primary
alternative and characterize it with three
elements, namely: 1) Reintegration includes
returns from institutions, co-governance,
re-governance, restoration of central
processes, radical reduction of production
costs, reengineering office functions,
concentrating procurement and
specialization, and simplification of
networks; 2) Needs-based holism includes
client-based or organization-based
reorganization, for example, interactive
information search and query, data
warehousing, end-to-end service
reengineering, and agile government
processes; 3) Digitization processes include
electronic service delivery, new forms of
automated processes, radical
disintermediation, active channel
streaming, facilitating isocratic
administration and co-production, and
moving towards open book governance.
However, in the practice of NPM
management, every country or institution
that runs it still experiences various
problems. This study will explain the
criticism of the implementation of NPM.
MATERIALS AND METHODS
This research is part of qualitative
research using a
systematic review
approach.
Systematic review
is a method
that uses previous evidence-based
evidence through boxing, evaluation,
structured evaluation, classification and
categorization. Because the steps and
strategies for conducting systematic
reviews are well planned and structured,
this method is very different from the
method used only to deliver literature
studies (Sugiyono, 2016).
Systematic
review
is a type of evidence synthesis in
which broad or narrow research questions
are formulated, and data directly related to
systematic review questions are identified
and synthesized. Data were collected
through a literature review of previous
research. Then, it is inferred through
deductive reasoning (general to particular).
A literature review is a systematic approach
of previous studies related to research
questions, both in a broad and narrow
scope. There are several previous studies
and studies on NPM that can be used to
help answer the questions in this study. In
addition, this study used secondary data.
The following will be illustrated the flow of
this research.
RESULTS AND DISCUSSION
New criticisms of public
management: Although the idea of
NPM has spread internationally and
Lukman Arif | 1914
many countries have introduced
reforms associated with it, there have
been some criticisms of it. Before
examining these criticisms, it is
important to emphasize that NPM is
not a definite set of actions. Some
observers believe that NPM is best seen
as a menu from which choice can be
(Van De Walle & Hammerschmid, 2011).
The menu is long, as can be seen from
the discussion in the previous section,
and different countries make
contrasting choices that lead to
variations in the form of NPM found in
certain countries, some of the things
that become critical regarding the
implementation of NPM are:
1. Thisimplies the paradox of
centralization through
decentralization.
To illustrate this point,
(Batley, 2004) notes that giving
public administrators more
authority to manage programs can
result in a concentration of
decision-making with them.
Therefore, NPM can lead to
centralized decision-making by
public administrators, instead of
promoting decentralization in
public organizations as it claims.
decentralization of partnerships
and networks. In this strategy, NPM
is accompanied by a process of
decentralization and devolution
according to the principle of
vertical subsidiarity, where
institutions closer to society are
considered capable of framing
problems and implementing
solutions. However, if not
entrepreneurship, decentralization
can negatively impact community
participation, particularly in social
policy. (Christensen, 2010) On the
other hand, social risk can be
delegated without adequate
resources. When it comes to
building networks, it needs to be
focused on partnerships, networks,
shared services, and new ways to
work together. In addition, public-
private partnerships are needed,
where the public sector and the
private sector share the risk of
incoming resources to generate
more value for the benefit of both
sectors. Partnerships for public
action have existed for a long time,
and many historical examples of
partnerships can be cited.
2. Refers to the application of
management techniques from the
private sector to the public sector.
While NPM has encouraged the
use of private sector management
techniques, there may be risks
associated with the adoption of
some private sector practices (Erlie,
2005). Many academic
commentators argue that most
areas of public service and
administration have different
political, ethical, constitutional, and
social dimensions, and these factors
make the public sector different
from the private sector. A
1915 | New Public Management Critical Riview
complementary view is given
(Savoie, 2002), which argues that
NPM is fundamentally flawed
because private sector
management practices are rarely
adopted in government operations.
For them, NPM is not suitable for
the public sector because it has
more complex objectives, more
complicated responsibilities, and a
more turbulent political
environment than the private
sector. In addition, the relationship
between administrators. The main
characteristics and components of
NPM which usually emphasize
efficiency, even innovative
solutions, can work well in private
business amun, in addition to
having an efficient and innovative
government, the government and
the public sector also need to think
about public values, such as justice,
fairness, representation, and
participation, are important values
to be achieved (Kirana &; Majid,
2022) Market-oriented
governments often use private
market structures to solve problems
rather than administrative
processes, such as service delivery
or administration and control
through legislation. By providing
fiscal incentives, for example, so
that private companies or members
of society behave in this way
contribute to the resolution of
social problems.
3. National culture influences the
implementation of NPM.
Another factor to consider is
national culture, which means NPM
can be very suitable for governance
reform in developed countries, but
in developing countries, NPM can
lead to more corrupt governance
because there is a lack of meeting
the principle of accountability.
(Winarno & Retnowati, 201) Even
according to , NPM can lead to
unfair outcomes that occur due to
decentralization. In addition, the
government needs to start two-way
communication to build digital
government in Indonesia because
public participation is believed to
be the core of digital government.
In developing digital government,
the Indonesian government needs
to start involving the public in its
design, so that the platform is not
only built from the government's
point of view. Governments can try
bottom-up approaches because
they work from citizens, businesses,
and stakeholders, also allowing for
more interaction, experimentation,
and bargaining for what is needed
at the bottom (Mamuko &; Adnan,
2021).
(Andrews, 2003) observes
the 'administrative culture
incompatibility' affecting the
implementation of Western-
developed reforms in Western and
Asian societies. He points to
differences in cultural values where
Western societies are represented
Lukman Arif | 1916
by values such as individualism,
utilitarian self-interest, achievement
orientation, and Asian societies by
values such as collective family
values, community connections,
seniority and reciprocity. Research
conducted by the country also
highlights the importance of
'interpersonal relationships' in the
Asian context, particularly in
Confucian-influenced societies
(such as China and Vietnam) where
professional and personal
relationships are integrated
through social interactions (such as
home visits, gift-giving meals). The
increase in cultural references to
the analysis of public management
reform is only a recent
phenomenon. This is not always the
case, and previously culture was
only used in a prescriptive or
rhetorical sense (Borins, 2003)
agrees that while there is some
interlinkage between culture and
public management, it is not
systematically and explicitly
incorporated with reference to
adequate theory. They argue that in
empirical social science the concept
of culture seeks to explain
differences in the behavior of
diverse groups of actors in
objectively similar situations.
(Batley, 2004) offers a layered vision
of culture, consisting of macro,
meso, micro and nano approaches
in the perspective of public sector
reform. These approaches mainly
differ in what they use as units of
analysis. At the macro level, the unit
of analysis is society, at the meso
level it is administrative and
professional, at the micro level it is
the organization and at the nano
level it is the office within a
particular organization or group of
work. This paper examines culture
from macro and meso perspectives
to examine Bhutanese culture.
Geert Hofstede's Value Survey
(VSM) module, which uses
organisational theory and
psychologists.
4. Institutional Issues
Challenges in implementing
modern public management in the
country arise as a result of
institutional problems, lack of law
enforcement, capital, and human
resource capabilities. In addition,
developing countries continue to
implement reforms that are
unrelated to or even contrary to the
goals of the NPM. The package on
the NPM agenda has not yet been
fully executed. (Hanifah, 2018) Like
the problems that occur in Indonesia, the
Evaluation Results of the Ministry of
PAN-RB reveal that there are several
problems in the process of
implementing performance
management in Indonesia,
especially the inability of
government agencies to (1) set
1917 | New Public Management Critical Riview
strategic and target-oriented goals;
(2) determine a measure of success
that describes the degree of
achievement of the goal / goal; (3)
determine activities (programs and
activities) that have an impact on
achieving goals/objectives. This
condition can be seen from the
results of the 2016 performance
accountability review which shows
that very few government entities
have obtained a minimum rating of
B. (good). Assessment B (good) is
the minimum score for
performance management
maturity in government agencies. A
number of problems arise as a
result of government agencies' lack
of understanding of the reasons for
their existence and commitment to
growth. In addition, government
agencies' knowledge of the
concept of value for money, which
is a way of life for very low
performance-based budgets.
Government agencies are
accustomed to the budgeting
paradigm of budgeting lines, which
focus only on financing inputs
without considering whether input
finance will produce outputs and
outcomes that have an impact on
development
CONCLUSIONS
Based on the results of the analysis that
has been carried out, some of the things
that become critical related to the
implementation of NPM are: 1)
decentralization can have a negative
impact on community participation,
especially in social policies. On the other
hand, social risk can be delegated without
adequate resources. When it comes to
building networks, it needs to be focused
on partnerships, networks, shared services,
and new ways to work together. In addition,
public-private partnerships are needed,
where the public sector and the private
sector share the risk of incoming resources
to generate more value for the benefit of
both sectors. 2) Refers to the application of
management techniques from the private
sector to the public sector. Many academic
commentators such as Pollitt (1990) and
Armstrong (1998) argue that most areas of
public service and administration have
different political, ethical, constitutional,
and social dimensions, and these factors
make the public sector different from the
private sector. 3) National culture influences
the implementation of NPM. Another factor
to consider is national culture, which means
NPM can be very suitable for governance
reform in developed countries, but in
developing countries, NPM can lead to
more corrupt governance because there is
a lack of meeting the principle of
accountability. 4) Institutional Problems
The challenges in implementing modern
public management in the country arise as
a result of institutional problems, lack of law
enforcement, capital, and human resource
capabilities. In addition, developing
countries continue to implement reforms
that are unrelated to or even contrary to
the goals of the NPM. The package on the
NPM agenda has not yet been fully
Lukman Arif | 1918
executed.
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© 2023 by the authors. Submitted
for possible open access publication
under the terms and conditions of the Creative
Commons Attribution (CC BY SA) license
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