Janus-faced reorganization: specialization and coordination in four OECD countries in the period 1980—2005
| Author | B. Guy Peters,Geert Bouckaert,Koen Verhoest |
| Date | 01 September 2007 |
| Published date | 01 September 2007 |
| DOI | 10.1177/0020852307081144 |
| Subject Matter | Articles |
Review of
Administrative
Sciences
Janus-faced reorganization: specialization and coordination in
four OECD countries in the period 1980–2005
Koen Verhoest, Geert Bouckaert and B. Guy Peters
Abstract
It is believed that the New Public Management (NPM) doctrine resulted in a dis-
aggregation and a suboptimal fragmentation of government in the 1980s and
1990s, which called for a re-strengthening of the coordination capacity through
renewed hierarchy-type mechanisms, market-type mechanisms and network-type
mechanisms. In order to assess the validity of this assumption, this article identifies
the trajectory of specialization and coordination in four countries (New Zealand,
United Kingdom, Sweden, France). The results support the assumption, although
different trajectories are discernible. Also, the results point to the renewed empha-
sis on coordination based on hierarchy, along with markets and networks.
Points for practitioners
● Specialization and integration both can have significant benefits for the
functioning of the public sector, but excessive adherence to one or the other
produces dysfunctions.
● There are a range of instruments available to managers for imposing coordina-
tion, but these must match the existing organizational cultures and the available
resources.
● The issues of specialization and coordination refer to linkages within the policy
cycle as well as the structure of government.
Koen Verhoest is Assistant Professor at the Public Management Institute (Catholic University of
Leuven, Belgium) where he specializes in research on government control, organization, marketiza-
tion and governance, including relationships between the state, agencies, for-profit and non-profit
organizations. Geert Bouckaert is Professor of Public Management, Director of the Public
Management Institute at the Katholieke Universiteit Leuven, and President of the European Group of
Public Administration. He publishes on issues of performance measurement and management
reform. B. Guy Peters is Maurice Falk Professor of American Government at the University of
Pittsburgh, and also holds honorary appointments in several universities around the world.
Copyright © 2007 IIAS, SAGE Publications (Los Angeles, London, New Delhi and Singapore)
Vol 73(3):325–348 [DOI:10.1177/0020852307081144]
326 International Review of Administrative Sciences 73(3)
Keywords: France, hierarchy, Joined-up Government, markets, networks, New
Zealand, Sweden, United Kingdom
Introduction
As a consequence of New Public Management dynamics, governments in many
OECD countries have been dividing large multi-objective bureaucracies into many
small, mostly single-objective organizations, such as agencies and other autonomous
bodies (e.g. OECD, 2002; Pollitt and Talbot, 2004; Verhoest et al., 2004). This dis-
aggregation through ‘agencification’ is the result of a process of vertical and horizon-
tal specialization.
Recently, a renewed emphasis on coordination of policy and management is
noticeable in many of these countries (6 et al., 2002; Bogdanor, 2005; Gregory, 2006;
Halligan, 2006; Richards and Smith, 2006). ‘Whole of Government’ initiatives like
Joined-up Government in the United Kingdom, ‘Horizontalism’ in Canada, similar ini-
tiatives in Australia, and ‘Reviewing the Centre’ in New Zealand, an increased focus on
horizontal collaboration and integrated service delivery between public organizations
and governmental levels, as well as mergers of departments and reintegration and
standardization of agencies are manifestations of this new trend (Christensen and
Lægreid, 2006a).
An increasing number of scholars argue that these two trends are interrelated as
cause and consequence (Pollitt, 2003; Pollitt and Bouckaert, 2004; Bogdanor, 2005;
Boston and Eichbaum, 2005; Verhoest and Bouckaert, 2005; Christensen and
Lægreid, 2006b; Gregory, 2006; Halligan, 2006):
These ‘Whole of Government’ trends can therefore be seen as a reaction to the
‘siloization’ or ‘pillarization’ of the public sector that seems to be typical for the NPM
reforms. The principle of ‘single-purpose organisations’, with many specialized and
nonoverlapping roles and functions, may have produced too much fragmentation,
self-centred authorities and lack of co-operation and co-ordination, hence hampering
effectiveness and efficiency. (Christensen and Lægreid, 2006a: 4)
Thus, the specialization trend appeared as a fragmentation which sometimes was so
significant that existing, new and renewed mechanisms of coordination had to be
(re-)established, supporting a basic assertion of organization theory that specializa-
tion and differentiation increases the need for coordination (Mintzberg, 1979;
Thompson, 1967).
But to what extent does reality reflect this pattern of increased specialization,
followed by increased coordination? Is this pattern only visible in countries which
vigorously applied the NPM paradigm of separating policy implementation from
design by creating single-objective agencies? Is this an overall pattern in OECD coun-
tries with different politico-administrative cultures, or are there different trajectories?
Is the increased level of specialization, and the perceived fragmentation stemming
from it, the only or main driver for a renewed emphasis on coordination? What do
these coordination strategies look like? Are other coordination instruments used than
traditional hierarchical mechanisms? Do these new coordination strategies turn back
agencification or other forms of proliferation or do they rather co-exist with high
degrees of specialization (Christensen and Lægreid, 2006b)?
Verhoest et al. Specialization and coordination 327
The research reported in this article examines these issues of coordination in the
public sector (Bouckaert et al., forthcoming). The focus is central government, with its
three combined levels of cabinets, ministries, and their related autonomous entities.
In this article we summarize some of the general findings over 25 years for four coun-
tries (out of seven, excluding the USA, Belgium and the Netherlands): New Zealand,
the United Kingdom, Sweden and France. The selected countries have different
politico-administrative cultures and different levels of adherence to NPM doctrines of
administrative reform (Pollitt and Bouckaert, 2004):
● Anglo-American countries: New Zealand and the UK as high-profile NPM
reformers;
● Nordic European: Sweden as a Scandinavian country with moderate NPM profile;
● Latin European: France, with a rather low NPM profile.
First, we discuss our initial hypothesis on the trajectory of specialization and co-
ordination, which we assume to be similar for OECD countries. Then, we describe
what actually happened in the four countries, by presenting their trajectory from
1980 to 2005 at a general level, delineating two clusters of countries with divergent
trajectories. We next compare the coordination strategies in the four countries with
respect to the drivers for coordination and changes in the coordination mechanisms
used. We also investigate to what extent the traditional emphasis on hierarchical
coordination methods shifted during the period 1980–2005 towards an emphasis
on market- and network-based mechanisms. We conclude with a discussion of the
main findings and formulate some elements for a future research agenda.
A conditional assumption: specialization leads to better
performance
In a public sector context, specialization, based on geography as well as different
types of tasks, customers or processes (Gulick, 1937), could be defined as the
creation of new public sector organizations with limited objectives and specific tasks
out of traditional core departments with many tasks and different, sometimes con-
flicting objectives (Pollitt and Bouckaert, 2004). It may emerge in two forms (cf.
Heffron, 1989): (1) horizontal specialization as ‘the splitting of organizations at the
same administrative and hierarchical level . . . and assigning tasks and authority to
them’ (e.g. split one department into two); (2) vertical specialization as the ‘differen-
tiation of responsibility on hierarchical levels, describing how political and administra-
tive tasks and authority are allocated between forms of affiliation’ (Lægreid et al.,
2003). This transfer is labelled decentralization, devolution, delegation, agencification,
outsourcing and even privatization.
Organization and standard economic theory assumes that specialization results in
efficiency gains, for single tasks as well as for broader clusters and departments with-
in organizations. According to New Public Management, specialization also enhances
efficiency for families of organizations at a particular level of government. As a result,
major monolithic organizations have been disaggregated into smaller parts, often
referred to as agencies, which obtain a level of autonomy (Hood, 1991; Bogdanor,
328 International Review of Administrative Sciences 73(3)
2005). This resulted in a fragmentation of these organizations. Accountability regimes
came to focus heavily on individual organizations and their managers, based on
narrow organization-specific objectives and performance targets (James, 2004;
Bogdanor, 2005). This movement combined with two other traditional shifts: the
familiar split between politics and administration, and the split between policy design
and implementation.
At the beginning of the 20th century, scientific management favoured a politics/
administration split. As part of a ‘Government for the Efficient’ it was necessary for
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