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The Successes and Failures of New Project Management - Coursework Example

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This paper, aims at discussing the successes and failures of New Project Management in light of one organizational public sector; the National Health Service. NHS is a public sector organization that was started in 1948 as a UK wide- system for providing health-care that is…
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The Successes and Failures of New Project Management
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PUBLIC SECTOR ORGANISATIONAL TYPE By NHS to illustrate the successes and Failures of new public Management Developments Introduction This paper, aims at discussing the successes and failures of New Project Management in light of one organizational public sector; the National Health Service. NHS is a public sector organization that was started in 1948 as a UK wide- system for providing health-care that is publicly oriented and tax- financed to be accessed by the general population (Bevan and Hood, 2005). The aim was to replace the previous system of private local authority organization. Since, the integration of the NPM in NHS there have been diverse failures and successes as will be illustrated in the paper using relevant diagrams. NHS as a Public Sector A public sector is one that receives its funding from its government or was started out of a government funding (Gorsky, 2006); NHS has several organizations; firstly, the health authorities concerned with the health policies and services (Funnel, Copper and Lee, 2012). According to Letchfield (2010) NHS trusts provide hospital, community and ambulance services to patients. The community health council, acts as the voice of the people to NHS and lastly the special health authorities who are divided into two: NHS Supplies authority and NHS information authority.; are concerned with NHS supplies and the information and IT departments’ respectively (Prowle, 2009). NPM and its recent developments New Public Management with reference to Samuelson and Marks (2012) is a general concept that is used to denote a global wave of administrative reforms that have had an impact on many countries public sector (Christense and LaeGreid 2011). It is a concept with different trends dependent on the circumstances of the particular public sector in context (Adcroft, Robert and Willis 2005).NPM lacks a clear cut definition but it has certain elements that can prove its existence. The main NPM reforms that entailed bringing changes in the governments and public administrations are said to have begun in the UK under Prime Minister Margaret Thatcher The NPM intended reforms Miller and McTauish (2014) affirm have not been as easy as anyone would presume; the various governments have had to face diverse and complex challenges, if anything some challenges are still in existence to date. NPM aimed at planning and control in the public sectors, according to Pallot (2006), the main aim of financial reforms should be to incorporate a budget while securing performance. NPM therefore, wanted to ensure that public expenditure is restrained while quality performance is achieved. Moreover, upon incorporation there was a focus on its characteristics: professional management, explicit performance standards and measures, focus on the output results, desegregation and decentralization, increased competition, private sector management practices and discipline in the use of resources (Hood 2010). Goldfinch and Wallis (2009) claim that professional management entails having managers acquire new skills through serious financial training. Secondly, it ensures the employment of professional accountants in public organizations. The second characteristic is performance measurement; with reference to Todnem and Macleod (2009) it emphasizes on the need to have Performance Indicators. However, Rantanen et.al (2007) point out that there are various challenges to performance measurements in public sectors that include: lack of objectivity and lack of managerial skills. Thirdly, Outputs and Customer Expectations where there is a need to link performance Management Systems to their Financial Information.Fourthly, Decentralisation and delegation of financial responsibility White (2010) says, gives room for the devolution of power across different units. Fifth is Competition and outsourcing it uses a third party to deliver all or part of what the public manager would have.Sixth is the application of private sector management techniques like broadening of the finance department. The last characteristic is discipline in the use of resources wherein managers are expected to do much more with less (Pasquier and Villeneuve, 2012). In the past decade the modernisation and implementation of NPM can be traced back; in NHS, especially, inn NHS modernisation structure is based on the commission for health improvement. Lapsley (2010) asserts that the modernization strategies have been reinforced by certain mechanisms that include: performance management, performance indicators, performance monitoring, public service agreements, best value audits and comprehensive spending reviews. In the perspective of best value audits and comprehensive spending reviews NPM is based on accrual accounting (Shah, 2007). Accrual accounting, is meant to replace traditional cash accounting so as to enable financial reporting which is essential in public sectors. The elements recognized under accrual accounting entail assests, liabilities, revenues and expenses (Lapsley, 2003). The purpose of accrual accounting in public sectors is to enhance transparency and to help in identifying the full costs of activities which in turn helps the managers know how to allocate resources in the public sector. However, most public sectors have not been implementing accrual accounting incomplete by applying the principles that are in line with it; nonetheless most public sectors apply some elements of accrual accounting (Lapsley, 2003). Given the challenges that come with accrual accounting there has been a shift towards performance auditing; which incorporates auditors who can verify the accounts in the public sectors.This accounting information is then used in comparing the goals that were made to the goals achieved so far. Figure 1:Characteristics of New Public Management NHS in application of NPM Lapsley (2003) clearly states that the reforms that have been crried out in the public sectors over the last decade have been quite vast; in NHS specifically has been the attempt to introducve internal markets into the health-care system while also incorporating new forms of organisations such as the hospital trusts.Various successes and failures were realized however as follows: Successes of NPM In NHS To start with, the incorporation of the Quality and Outcomes Framework (QOF) has to be the most successful reform in NHS since the inception of New Public Management (Greener, 2013).This is because it managed to meet an important goal: changing behavioural patterns among the General Practitioners (GP’s) through linking funding and points.The incorporation of Performance measurement as a characteristic of NPM in hospitals initially brought major problems (The national audit office, 2012). These problems had their roots in government- set targets that had been imposed on the hospitals; the clinicians and managers on the other hand realized that the targets did not match up with the expected improvements that their services were supposed to render at the end of the day. Clinicians and managers Greener (2013) asserts, realized that regardless of their work their performance would be non-conclusive as the targets were inconsistent with overall goals. However, through NPM reforms were incorporated such that now the hospitals have shifted from being targeted-focused to being more of quality-focused so as to avail suitable health-care to those in need of it (Bakvis and Javis, 2012). Focusing on quality has now allowed NHS to avail services that are appropriate and in line with the demands of the general public.More so, performance measurement has seen to it that NHS is unique and free at the point of use thus is more efficient than insurance-led health services (Budding, Grossi and Tagesson, 2015). For instance, targets in surgery were no longer based on abstract figures, but on concrete items of practice. Consequently the General Practitioners were added the mandate to set the Quality framework targets themselves, which in turn has resulted in the meeting of and exceeding of the General Practitioner’s targets. Secondly, the combination of spending cuts and rising demand, especially in adult care has made NHS manage to make efficiency savings and reduce overheads even more efficiently (Hood, 2011). Efficiency savings have gone a long way in securing the well-being of patients in NHS given the fact that the market is continually becoming demanding as well as the need to use resources. The efficiency savings have assisted in the development of the drugs and medical technology in hospitals, a general ability of NHS to keep up with the demands in the sector. Clearly, the NPM characteristic of proper use of resources can be reflected through the efficiency savings done by NHS. Ultimately NHS is now in a proper position of doing much more in terms of delivering health services with very little of the resources or rather public money it is predisposed to. Initially NHS like any other public sector would extravagantly utilize resources putting heavy burdens on the government; however, this has been reformed by the NPM. Thirdly, NHS attained patient satisfaction. To start with Baker (2007) assures that NHS currently, remains one of the most progressive health services in the world especially because it maintains quality while driving down costs. This has been key to most governments since 1979 as they have been committed to a free NHS while also trying to make it quite responsive to its users, more co-efficient and more marker-led.One of the ways how patient satisfaction has been achieved according to Bevan and Hood (2010) is through increasing staff efficiency such that patients now spend quite some limited time in the Accidents and Emergency section; this shows that the incorporation of NHS trusts was not in vain as it is NHS organization that has made this possible.Moreover, It is said that in 2003, 23% of patients stayed over four hours in the Accident and Emergency section but this number greatly reduced to 5.3 % in 2004 (Bevan and Hood, 2010). In recent times there was a great concern pertaining to expenditure in NHS; however, since NPM the finances and resources in NHS have been greatly accounted for. Fourthly, NHS has been consisitent in trying to cut down costs such that it has since been in a position to do more for less; with regards to this NHS often practices a fair deal of rationing.For instance, it ensures that patients stay for a short period in hospital while reducing the cost of staying per patient as illustrated above. Therefore, Nhs is able to achieve customer satisfaction while at the same time utilize finances efficiently. Besides discharging patients soon enough, NHS also sees to it that it avoids rendering some services e.g. limits the kinds of medicine or froms of treatments.This is to ensure that the forms of treatments and medicine that are too costly are avoided so as to stay within the budget. This has then in the long run allowed since the inception of the NPM to date, NHS to uphold its main building blocks that entail lowering costs per unit of service. NHS has so far managed to ensure that by the time an individual is in need of health-care then it will be readily available and more so free in nature as compared to the insurance- led private health-care systems. Fifth success in NHS lies under the significant and tangible changes to the health provision; basically MacLaughing and Osborne (2005) assure that due to NPM the policy process and legitimacy of local government decisions has been enhanced. Eventually, NHS has been able to establish primary care groups that have in turn reinforced the participation of the general public in decision-making. This reflects the decentralization and delegation characteristic of NPM; unduly due to this, the public representatives have been involved in governance arrangements of the primary care groups and any other new institutions in NHS. This is of essence as the public to which the health care service is accorded have now become part and parcel of this process. They have a say on the necessary amends that they feel should be in place in terms of health and social care; they plan and give directives on what needs to be done in the health-care system. When it comes to the sixth success the audit commission (2006) says that NHS by incorporating NPM it has managed to cool the tensions between the managers and the professionals; Initially, the professionals were in charge of both the management and running of NHS. The Proferssional i.e the doctors would treat patients, prescribe mediaction as well as perform managerial functions such as what patients could be accepted into the hospital. This in the past was a perfect reflection of how the professionals carried out both rokles without any worry thus making the services of managers dispensable. However, when NPM came into perspective, there was a clear distinction concerning roles with regards to who does what. NHS thus saw to it that there was a restructuring that permitted managers to risde to theuir rightful positions; these managers are not alwatys professionals in the health-care system but professionals in managemnent. The employment of professionals has since been effective in NHS as it is in line with NPM’s administering of professional management skills. Furthermore, placing managers has seen to it that part of the dilemma of public health is resolved. This is by virtue of the application of the necessary and adequate managerial skills that are needed in the management of hospitals. All the managers in NHS now are required to have and apply up to date business skills. Currently, in NHS career website, there are almost 78 managerial posts that are inclusive of: career managers, human resource managers, health managers among many others (MacLaughin and Osbortne, 2005). This shift in management has fostered great growth in NHS, while at the same time changing the structures that were initially a hindrance to NHS success. Seventh, NHS since the incorporation of the NPM has now allowed for the provision of competition and outsourcing of some of its services. For instance, it has acquired cleaning, catering and other services from private organizations. This has pushed NHS to acquire and achieve further developments. For instance, the government has given contracts to construction companies that have overseered the building of new NHS hospitals. If at all NHS was goimng to take this task upon itself; it would fail terribly given its strict financial budget.The outsourcing of services that is a characteristic of NPM has been quite beneficial and useful in NHS development. Lastly NHS since the incorporation of NPM has allowed the patients to speak out and express their feelings when it comes to the kind of services they are receiving. Through this provision patients have been able to raise their concerns more often and clearly without any prophibitions.Thus to achieve this NHS has had to employ market principles that have made it possible to reach out to their consumers, that is the patients. The first presentation of patients’ rights and standards was recorded in the patient’s charter in 1991 (Frederickson and Ghere, 2013). Since then NHS has come up with a vast range of documents with NHS plan (DOH- 2000) replacing the patient’s charter all aiming to represent patients rights in NHS. The success attained in NHS through NPM can be summarized in two: Quality outcomes framework and patient satisfaction. The QOF captures the mananagemnt, the clinical staff and services availed while the patient satisfaction captures costs and efficiency of services availed. Figure 2: NPM successes in NHS. Failures of NHS in application of NPM To start with, the budget is considered a key instrument in the fostering of the necessary changes in the public sector; in NHS the clinical budgeting in place is considered a great failure (Lapsley, 2003). This form of budgeting has been an epic fail due to various reasons: one the exisiting power struggles between the doctors and administrators; initially, the clinicians or rather medical doctors would perform both administrative and medical work. However, once the reforms came about this had to change as professional managers had to be given their rightful positions; thus it has since resulted in power brawls between the two parties as each one has diverse targets. Lapsley (2003) claims that the doctors have not been efficient in applying accounting startegies and more to it have not been corporating to ensure the reduction of costs. Additionally, there have been operational difficulties in attempting to have all the units in the hospital work together in the implemnatation of the clinical budgeting systems. In line with this, Stacey and Griffin (2006) assert that the continuous growth in numbers of managers and staff only reflects the great need to continuously monitor and control NHS; which makes this public sector a bit too costly. The mode of employment in NHS can be considered as one of the consequences of the new public management. It is said that the total employment in NHS has been increasing at a very rapid speed. Such an upsurge in employment only illustrates the amount of demand that is in this particular sector; hence the government should secure a consistent flow of finances into the sector while maintaining a satisfied public. This argument is further supported by Crisp (2011) saying that more than 60% of NHS expenditure is spent on paying people. An upsurge in the employed staff consequently results in an upsurge in NHS funding that they absorb.This has been a great failure of NPM in NHS as since its inception there has been an increase in terms of payment for the working staff; This rise in pay has not been equal to the productivity that has been in play in NHS. More to it most resources have had to be channelled outwards other than remaining put; thus putting more strain on the already over-stretched budget. Additionally, Burton (2013) asserts that the National Health Service in the UK has been facing great challenges in this given decade; starting from suffering government cuts since 2010 to having to deal with a rising budget that is way below healthcare inflation. Incidentally, Moran, Rein and Gooding (2006) claim that NHS has also had to, face demand pressures from a population that is both growing and ageing such that greater numbers of patients with chronic illnesses are expected to increase 4 % a year to NHS costs for the next decade (Burton,2013). Therefore in light of this great budget challenge, the NPM seems to be failing in NHS when it comes tom sustaining the cutting of costs.As the health-care continues to remain free per say NHS continues to face increasing demands that it cannot face nor solve given the current budget.Doing more for less seems to be almost impossible with the rising demand for health-care; more finances are needed yet at the same time there is a need to ensure that people are not exposed to overly-high taxes for this health- care service. This has been a great weakness in the making making reforms in NHS as it has eventually resulted in higher cost (Mclaughlin et.al, 2005); it has raised questions whether further structural reforms will only keep raising the costs or improve productivity. The mere fact that the Taxpayers have had to be exposed to expensive and long-term debts stemming from hospital projects is overwhelming. However, according to Cass (2006), Demand is not the only concern; patients also demand that the services are of a high quality and are timely. Therefore, NHS needs to do more in terms of its structures; channeling more finances into the public sector is as to secure quality and quantity that meets demand sufficiently. Secondly, the rationing of services by NHS due to NPM in an attempt to cut down costs has only lead to poor quality in terms of the services that are delivered in the hospitals.Rationing has forced NHS to have the employed staff performing multiple staff tasks so as to save on costs.Therefore, as costs are cut down so as to maintain free health-care, the health-care does become compromised in the process. In the long run it has even amounted to the use of inadequate skilled staff, for instance, job roles have been made extremely flexible whereby patients are given services that could risk their lives and personal existence. For instance, a nurse could also perform the task of a junior doctor; less qualified staff ends up taking care of patients with complex needs as the demand is too high. In line with rationing patients not only receive poor quality services, but these services are also further limited wherein patients are forced to leave the hospital even before they have fully recovered. They are evicted by force, especially because there is that need for another patient to take on that space for treatment; for a limited time as well. Rationing has with time resulted in conflict between managers and staff; as the managers continually focus on meeting targets the staff focus on quality care which with the presenting situation is unattainable. Therefore, the clinicians are pushed into a position where they deliver incompetent services; they now focus on discharging patients as a priority. Due to the pressure - reducing costs while mainatining productuivity- they receive from the managers the clinicians have no option but to do as they are told as it will only save them from trouble.In the long run, they deliver poor quality services to the patients; incidentally, any patient that seems sto be over-staying in the hospital is likely to be seen as some sort of inhibition to the functioning state of NHS (Ogden, 2009). Alongside, the under-qualified staff, the immense pressure to perform is the over-working of staff.The clinicians in NHS are now being exposed to the great pressure of taking care of a wider spectrum of patients, to perform roles that are not entirely theirs as well as to achieve greater levels of productivity (Smith, 2007). If this is not enough, so as to keep up with the reforms staff have no option but to learn new skills within a limited time and learn how to apply these very skills in their jobs so as to meet the great demands.The training to acquire new skills is normally incorporated even in the staff’s free time meaning that burn-out and slagging at the work place during shifts is possible yet the patients demand a lot of attention. The over-working of staff stems from the fact that managers carry out constant cuts to release the so termed unproductive staff from their duties. Hence, the staff that remains is exposed to a load of work with the aim of maintaining productivity while making up for the laid off staff members. Additionally ,Hastie (2006) claims the managers have also had to replace competent and skilled staff members who demand more pay with less qualified staff members who demand less pay. This is bewildering at how poor the NPM is doing given the fact that it was meant to do away with various discrepancies. This is a bit alarming as there is in no way with the pressure of cutting costs that the staff will secure productivity. The end result is hence poor quality services. Thirdly, as the NPM was being implemented it introduced the Price and Control Systems in the public sectors. This focused on the planning and implementing of substantial strategies. The implementation of this system has not at all been easy, irrespective of the fact that it comes with various provisions such as having low- level managers make operational decisions and also the measuring and rewarding of results in the public sector (Lapsley, 2010). Initially, NHS would pay its staff on the basis of performance; thus making a good salary a sort of incentive. This was highly inefficient, especially because it only resulted in over- expenditure in NHS. The Price and Control system is important but has been ineffective in NHS, especially because it’s a non-profit organisation that is controlled by the outputs it makes. Therefore, the failures in NHS can be broadly categorized under three: the budget, which is strained due to the rapid growth of NHS staff, resistance from clinicians to apply accounting strategies and power struggles between managers and clinicians. Second category could be rationing so as to cut down costs, which results in conflict between staff and managers, poor quality of services and unskilled and over-worked staff. The last category could be price and control system that has resulted in higher costs and over-expenditure in NHS. However, the budget constraints play a bigger role as opposed to rationing and price control system. Figure 3: NPM failures in NHS Conclusion This paper has presented the complexities that have come with NPM in public sectors more so NHS. Fryer, Antony and Ogden (2009) attest to the fact that public sectors are multi-faceted in nature thus making developments in these organizations very challenging. However, NPM reforms have been attempting to rearrange organisational relations while improving accountability. Precisely, reforms in NHS have been focusing on trying to ascertain that even as people continue to fall sick, the resources within the sector are used wisely and appropriately so as not only to meet demand but also improve on their level of technology (Bakvis and Jarvis, 2012). Nonetheless, this great shift has not been easy at all as the reforms have been and continue to be taxing, especially as illustrated by the failures of NHS. It is clear to see the successes and failures of NHS since NPM was incorporated into it (Frederickson and Ghere, 2013); irrespective of this, the reforms will remain consistent and intact. NPM reforms can therefore be said to still be in the process of implementation. NHS therefore needs to put essential measures into perspective. They need to Elect a suitable clinical commission group that will help create a budget that meets and suits the financial demands of NHS. According to Hastie (2006). This will see to it that the health-services still have the funding they need to be sustained for the access of the general public. More to it since NHS is a public sector, it is should be founded on accrual accounting, hence should by all means apply the accounting standards for public sectors through IPSAS. IPSAS are a set of measurement and disclosure policies for financial reporting on an accrual basis to be used by Public Sectors. The function of IPSAS is to offer guidelines, issue standards and occasional papers that are in line with Public sectors. The implementation of the new reforms is quite a difficult process; however, modernization and the trend towards financial systems remains an ongoing process. 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From the paper "High Failure Rates of new Products in the Market" it is clear that the various risks facing the ever-growing information systems company will be explored.... As of late, high failure rates of new products in the market have been recorded.... The focus will first be placed on the risk management cycle that many companies show little interest in embarking on.... Information systems risk management is a type of approach that tends to formalize risk-oriented risk-oriented correlates of success into applicable sets of practices and principles....
2 Pages (500 words) Research Proposal

Overview of PRINCE2 Project Management Methodology

The paper 'PRINCE2 Project Management Methodology, Engineering Management Project with successes and failures' is an engrossing version of assignment on management.... The paper 'PRINCE2 Project Management Methodology, Engineering Management Project with successes and failures' is an engrossing version of assignment on management.... We apply PRINCE2 project management methodology across all the different processes, right from developing to implementing a new engineering system....
10 Pages (2500 words) Assignment

Significant Reasons for Mega-Project

Additionally, most projects fail due to a lack of effectual project management.... is a good example of an assignment on management.... is a good example of an assignment on management.... This is characterized by poor forecasting, strategic misinterpretation, and biases, eventually leading to poor risk management.... Nevertheless, effective management of these factors is likely to increase the rate of successes among mega projects....
18 Pages (4500 words) Assignment

Engineering Contribution in Project Failure

To underscore the thesis statement, the research will attempt to review the case from project management as an aspect inherent among contemporary engineers.... Comparative research by the National Academy of Engineering (2005) brings the aspect of project management as a tool that engineers can use to mitigate and or minimize project failures.... Their study on 18 projects created by engineers indicated that integration of project management skills and engineering skills is the best approach to minimizing project failures especially those that suffer from overload....
29 Pages (7250 words) Case Study

Common Reasons for IT Projects Failure

Gulla (2012), states that project planning is essential to the success of an IT project, and includes elements like rules, methods, tools, and management.... The need for IT projects in the twenty-first century cannot be overemphasized and, when a promising project leads to massive failure, IT experts get worried (Chomal & Saini 2014).... It is in this backdrop that the essay discusses common reasons for IT project failures, and strategies that can help avoid such problems....
7 Pages (1750 words) Coursework
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