Public enterprise: The management challenge and getting together in public enterprise. International Sciences Association of Schools and Institutes of Administration, 1987,166 pp. and International Institute of Administrative Sciences, Brussels, 1987, 66 pp.
| Published date | 01 April 1990 |
| Date | 01 April 1990 |
| Author | C. O. Nuallain,R. Wettenhall,Malcolm W. Norris |
| DOI | http://doi.org/10.1002/pad.4230100213 |
Book
reviews
243
Part
1
sets out the rationale and methodology
of
different levels
of
appraisal, including
chapters
on
financial and institutional appraisal. Part
2
illustrates the issues and techniques
discussed
in
Part
1
through a series of case studies, two
of
which are worked through
in
great
detail. The two parts are linked through ‘boxes’
in
Part 1 which relate issues raised
in
the text
to the case studies.
Chapter
3
of
Part 1, entitled ‘Basic economic analysis for allocative efficiency’, is by far the
most important methodology chapter. This contains the fundamentals
of
shadow pricing and
will be extensively used by operational appraisers. However the subsequent chapters on
further economic analysis, involving saving premium and distribution weights, are included
almost apologetically. The treatment of the methodology
of
such analysis is hedged around
by
so
many warnings over reliance
on
‘judgement’, ‘crude estimation’, ‘and outdated
‘empirical data’ that the authors practically admit that such levels
of
analysis are almost
impossible, and rarely attempted.
On the other hand
in
setting out the levels
of
economic analysis in separate chapters the
authors have managed to draw clearly the distinction between economic analysis, based
on
well-established economic principles, and further economic analysis that requires elements
of judgement or data requirements that border
on
the heroic. This separation will help
in
eliminating confusion amongst economists, and consequently more economic appraisals
being carried out.
The chapter on ‘Financial analysis’ will be a little disappointing to planners looking for
guidance
in
financial planning. The concentration on financial ratios, and the almost
disguised treatment
of
working capital estimation, reflect the authors’ position as appraisers
of
projects. This viewpoint is also reflected in the fact that it is not until towards the end
of
the first part
of
the book that mention is made of the project resource statement estimated
in
constant market prices. As the authors state, the rate
of
return estimated from this is of
limited value, but
it
is a pity they did not think to refer to this statement earlier
in
the book as
the initial point of departure for economic and subsequently financial analysis.
Despite these minor drawbacks the new ‘Guide’ will be required reading for all students
and practitioners involved with development project planning and appraisal.
JOHN CUSWORTH
Development and Project Planning Centre,
University
of
Bradford
PUBLIC ENTERPRISE: THE MANAGEMENT CHALLENGE
and
GETTING
TOGETHER IN PUBLIC ENTERPRISE
Edited
by
C.
0.
Nuallain and
R.
Wettenhall
International Sciences Association of Schools and Institutes
of
Administration, 1987,
166
pp.
and
International Institute
of
Administrative Sciences, Brussels, 1987,
66
pp.
Both these useful volumes
of
case studies are a product of meetings of a Working Group
of
the IASIA, concerned with establishing the factors that lead to effective public enterprise
managers and management. They are appropriately written
in
an international climate which
is currently at least critical
of,
and even philosophically committed against, public sector
initiative
in
the economy.
The
purpose of the books is
in
no
way to present an apology for
public enterprise performance, but to illustrate the complexity
of
the role public
corporations and state companies are expected to play, and the consequent problems facing
their management, demanding great political sagacity as well as enterpreneurial flair and
managerial skill. Following the analysis
of
Dr R. C. Mascarenhas, the editors emphasize
the
contributions
of
both policy efficiency and operational efficiency to organizational success,
concluding that
it
is neither appropriate nor useful for central governments to criticize
organizations
to
which they have delegated functions, when they themselves have created a
policy environment that inhibits achievement
of
goals. In this context privatization is an
evasion of management responsibility.
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