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Book Summary

Osborne, David, and Peter Plastrik. 1997. Banishing Bureaucracy: The Five Strategies for Reinventing Government. Reading, MA: Addison-Wesley.

This book provides reinventors with practical know-how that can be applied. Osborne's early book, Reinventing Government, primarily described the characteristics of entrepreneurial governments. Banishing Bureaucracy sees a step further and provides a detailed description of the strategies used to create entrepreneurial governments.

The authors view reinvention as a fundamental transformation of public systems and organizations to create dramatic increases in their effectiveness, efficiency, adaptability, and capacity to innovate. They believe reinvention of public systems is accomplished by changing their DNAtheir purpose, incentives, accountabilities, power structure, and culture. Bureaucratic systems are replaced with entrepreneurial systems and self-renewing systems.

For changing government's DNA, the authors lay out five strategies (five C's) and introduce more than 900 tools. The five C's are:

  1. The Core Strategy for Creating Clarity of Purpose
    The first critical piece of DNA determines the purpose of public systems and organizations. The core strategy is to clarify the purpose of government. It uncouples steering, or providing guidance and direction, from rowing, or producing goods and services, so that each organization can concentrate on achieving one clear purpose.

    Tools for the core strategy include sunset rules (require that programs be reauthorized periodically), devolution (transfer activities to a lower level of government), competitive bidding (uncouple steering from rowing by requiring the rowing function be competitively bid out), performance budgeting (define the outcomes and outputs policy makers desire), and others.

  2. The Consequences Strategy of Incentives
    The second key piece of DNA determines the incentives built into public systems. The consequence strategy changes the incentives by creating consequences for performance.

    Tools for the consequence strategy include performance awards (providing employees with nonfinancial recognition for their achievement), bonuses (one-time cash awards), and performance budgeting (inserting required performance levels into budget documents).

  3. The Customer Strategy for Accountability to Their Customers
    The next fundamental piece of system DNA focuses primarily on accountability. The customer strategy gives customers a choice of service delivery organizations and sets customer service standards public organizations must meet.

    Tools for the customer strategy enhance public choice by allowing recipients of public services to choose between different providersall public or both public or private. This can be achieved through vouchers and reimbursement programs (give those eligible for certain services the resources to purchase them themselves, or reimburse providers when they do) or customer complaint systems (track and analyze customer complaints, ensure prompt response).

    Chapter 6, "The Customer Strategy: Putting the Customer in the Driver's Seat" describes Minnesota's experience with public school choice.

  4. The Control Strategy for Shifting Control Away from the Top and Center
    The fourth critical element of DNA determines where decision-making power lies. The control strategy pushes significant decision-making power down through the hierarchy and at times out to the community. There are three approaches in application of the control strategy: Organizational Empowerment (eliminating many of the rules or other controls imposed by higher levels of the organization), Employee Empowerment (reducing hierarchical management control and pushing down authority to front-line employees) and Community Empowerment (shifting bureaucracy's power out into community).

    Tools for the control strategy include decentralizing administrative controls, labor-management partnerships (agreements between managers and unions to cooperate on improving organizational performance and working conditions), and community-based regulation and compliance (shifts control over regulatory and compliance functions to communities, such as business or neighborhood associations).

  5. The Cultural Strategy for Creating an Entrepreneurial Culture
    The last critical piece of DNA determines the culture of public organizations. The culture strategy attempts to change the organization's habits, hearts, and minds.

    The tools for the cultural strategy are, for example, meeting the customers (expose employees to the customers through focus groups, conversation, or front-line work), redesigning the workplace (reinforces the emotional commitments leaders want, such as a sense of teamwork or a commitment to customer service), and benchmarking performance (comparing the performance of different organizations to dislodge outdated mental models by undermining faith in the old ways of doing business).

The authors acknowledge these strategies sometimes overlap, and some strategies are best used together. Thus, to optimize implementation of the strategies, reinventors must anticipate how these strategies will affect each other, and how they will work together most powerfully. In addition, they stress that the courage to reinvent is needed to use the five C's successfully.