Private Sector more Efficient than Public?

[Ed Anger]

That would be my new sex table.

[HVC]

i'd have a new dinning table

And a new living room table, and a new bedroom table...that thing could've landed a Boeing on it.

a chainsaw and varnish fixes all

[HVC]

That would be my new sex table.

can't. doesn t have a wheelchair lift.

[Josquius]

I really hate the way the 'bureaucracy' has become some big negative buzz word to be done away with at all costs. Too many people don't realise just how necessary bureaucracy is.

[Ed Anger]

That would be my new sex table.

can't. doesn t have a wheelchair lift.

I get that next fiscal quarter.

[HVC]

That would be my new sex table.

can't. doesn t have a wheelchair lift.

I get that next fiscal quarter.

[HVC]

I really hate the way the 'bureaucracy' has become some big negative buzz word to be done away with at all costs. Too many people don't realise just how necessary bureaucracy is.

you sound suspiciously like a bureaucrat

[Iormlund]

*Seem* is the operating word.  I'm currently working for an average sized (2000 employees) company that is owned by a multinational holding. 

Scratch that!

I'm posted at the site of an average sized company - owned by a multinational corporation - and serviced by my employer - another multinational corporation.  In the last few months the IT infrastructure of the original client company has been forcibly integrated within the 'globalized' infrastructure.  The turnaround services once provided within hours - are now delivered days later; those once offered within days are now delivered weeks later...  And the amount of paperwork - written or electronic - has exploded.

Naturally, since the central hub has off-shored to 3rd world shitholes most of the services once provided by my employer it appears - on paper at least - that there are significant operating cost savings.  However nobody seems interested in accounting for the 'intangible' costs of productivity loss due to the downtime of employees payed substantially more than the above  10- bucks-an-hour-and-a-bowl-of-rice-a-day slaves...  But in this era of short term quarterly bonus reviews I suppose this isn't worth mentioning.  The client we service is riddled with bureaucracy.  Which makes it possible for my employer to double or triple bill the services provided without anyone being the wiser...

I've seen a lot of that crap in big businesses here as well.

For example, one of our clients has IT spread all over Europe. DB management in Turkey, account handling in Poland, as so on. It takes months and dozens of emails for shit to get done.

And everyone seems to be in a meeting, all the time. It's hilarious. One of the old timers actually asked us if things are like that everywhere nowadays. In the old days, he said, when something was broken he got up and fixed it. Now, he said, I've got to go to a meeting and spend hours telling all sorts of people about what the problem is and what we could do to fix it.

[Valmy]

UPS and FedEx are two very large organizations that to me seem very efficiently run.

You have got to be kidding me.  Overpriced and annoying as hell to deal with.

[Ed Anger]

That would be my new sex table.

can't. doesn t have a wheelchair lift.

I get that next fiscal quarter.

get up on the table baby.

BEEP BEEP BEEP BEEP

[citizen k]

I really hate the way the 'bureaucracy' has become some big negative buzz word to be done away with at all costs. Too many people don't realise just how necessary bureaucracy is.

Kafka hates you.

[Tamas]

Grallon hit it spot on. A big enough organisation will be wasteful regardless of being private or public. Difference is, that at some point a private company either reforms itself or it falls. A public company has no such concerns. There is tax money to keep them afloat

[Martinus]

I don't think this is a function of size per se - although the bigger the organization is, the harder is to keep it efficient - but whether decision makers have a vested interest in keeping the organization efficient, or whether they have other, more primary interests, such as avoiding responsibility, covering your ass, or keeping your job (which happens when the organization is so big, it has to delegate decision making to people who do not have a vested interest in efficiency, and/or when the decision makers are not accountable to those interested in efficiency in the first place - which would be the case in public organizations, as well as corporations with a significantly dispersed shareholding).

Geniuses - such as owners/founders of big corporations - are capable of keeping them efficient despite their sizes, but when they give up the power to someone else, who is not as good at keeping them efficient as his or her primary goal, things usually go down the drain (vide: Microsoft and Apple).

Or to put it differently - efficiency is often a form of risk - you are essentially giving up some safeguards and processes in order to be faster in creating your product and taking decisions. Most people are sheep who prefer security to risk taking - so the moment the organization loses a visionary that guides it, it starts tending towards inefficiency. The difference between public and private organizations is that in the former you almost never have a visionary to begin with.

[Tamas]

good point Mart.
And I am ready to believe that it is possible to make incentives in cases of some public companies to keep them efficient, but for sure it's a lot harder, when you have a -from your perspective- unlimited source of funds behind you, and the political necessity to not let you fail.

Somebody mentioned the state budget -> private companies transfer being wasteful. Well, duh! That's the prime way for embezzlement and corruption, OF COURSE it's ineffective. Thinking that it would be better just because the receiving hand would be a state employee, maybe somebody who can be appointed by the one handing out the money, is very naivé

[Warspite]

I think the difference is less pronounced that might be thought, but the reasons for inefficiency are different to a degree.

Large private-sector firms, as is noted by posters above, also tend to find it hard to stay agile and lean. It's difficult to retain the shallow decision-making structures as a organisation gets bigger, and it's harder to ensure that everyone is working for the benefit of the company or maintain the average level of talent.

On the other hand, public-sector firms are at a much higher risk of legislative and political meddling, as well as the usual problems of size and so on.

Part of the supposed cost-saving of switching from public- to private-sector provision of services in the UK also comes from accounting trickery and optimistic bidding.

As an aside, competitive tendering processes also end up being horribly inefficient: I am involved in bids for publicly funding work, and the variation in processes is remarkable. For certain public institutions, it's one straightforward (albeit lengthy) form that is needed. For others, it's a byzantine process of compliance layer after compliance layer, with paperwork and "evidence" and "metrics" galore. Both sets of projects are for the same amounts of money, in the tens to hundreds of thousands.