Moslehuddin Khaled, Lecturer, School of Business, Independent University Bangladesh, Chittagong

Can We Apply Business like Strategic Management Approach for Better Immediate Performance in Government Organizations: Some case studies from Bangladesh

Moslehuddin Khaled, Lecturer, school of business, Independent University Bangladesh, Chittagong ()

Abstract

In business management, the concept and importance of strategic management is commonly understood and followed. Strategic management is about deciding broad goals for the organization, devising a long term course of actions, providing enabling environment to execute those actions, monitoring and evaluating the progress, and continuously updating with the changing environment. But when we look at the government (in a developing country like Bangladesh), we see there is a fundamental lacking of the strategic approach. Government takes big and long term plans and programs but does not have the understanding of enabling environment necessary for end-to-end management of those programs. So we always find cases of roads built without bridges or bridges without the roads.

In this paper, author looks into three cases in different set up in the government. First case is about increasing private sector participation in education, second one is about how to increase the tax revenue and the third one is about National ID card for the citizens. The common findings strengthen the argument that, if top management in government does not understand simple business like management principles and enable managers at lower levels, situation will not improve.

This paper is part of a larger study about improving management in government. Author welcomes suggestions and comments from different countries.

Keywords: government, public manager, cases from government organizations, strategic management, business management

INTRODUCTION

But when we look at the government (in a developing country like Bangladesh), we see there is a fundamental lacking of the strategic approach. Government takes big and long term plans and programs but does not have the understanding of enabling environment necessary for end-to-end management of those programs. So we always find cases of roads built without bridges or bridges without the roads. Public management or management in government is characterized by inconsistency of the policies and regulations, lack of coordination among activities and initiatives, lack of responsiveness, delay, long redundant procedures, and inefficiency. For all these, public managers (government officers) are often blamed, rightly or wrongly.

In this paper, author looks into three cases in different set up in the government. First case is about increasing private sector participation in education, second one is about how to increase the taxpayer base and tax revenue and the third one is about National ID card for the citizens. The common findings strengthen the argument that if top management in government understand simple business like management principles and enable managers at lower levels, then significant improvement will happen right away.

This paper is part of a larger study about improving management in government. Author welcomes suggestions and comments from different countries.

Case 1: Connecting Government and Private Sector In Education

In a developing country like Bangladesh, government alone cannot ensure the education of so many people without participation from private sector. So private sector funding is imperative to reduce the burden on government. But the overall environment of private sector in education cannot be called enabling. Private sector is not getting the encouragement from the government.

There is a clear gap or inconsistency in government intention and action in this regard. So we wanted to explore the overall enabling environment condition of education sector around the following key issues: Is there any strategic approach from the part of the government – Does ministry of education have any clear policy about encouraging private sector in educations sector – how do the education boards (the administering authority of the schools in respective regions) handle the queries of interested or prospective new private sector school founders or how proactive are they in assisting new or existing private schools.

The mainstream education system in Bangladesh is divided into three sectors:

The primary education sector covers education from the age of 6 for five years.
Secondary education covers the next stage, from the age of 11 for a further seven years.
Tertiary education covers subsequent education in universities and other institutes of higher learning.

Primary education

There are 80000 schools, of which 43000 are non government. The Directorate of Primary Education (DPE) has overall responsibility for the management and supervision of formal primary education.

From 1995 to 2010, number of primary schools increased by 28%. Public (government) schools hardly increased during the period whereas Private sector schools increased by 71%.

Secondary and higher secondary

The secondary education system in Bangladesh covers the next 7 years of education in secondary schools, colleges, and degree colleges. After class six to ten, there is a public exam called Secondary School Certificate (SSC) and after class 11 and 12, there is another public exam called higher secondary certificate (HSC) exam. As with primary education, the administration of secondary education is highly centralized. The Directorate of Secondary and Higher Education (DSHE) is in charge of secondary schools, intermediate colleges (higher secondary) and intermediate sections (higher secondary sections) in degree colleges.

The enrolment ratio is about half the enrolment ratio of the primary sector, showing a sharp drop in education take up rates. This is in line with other low-income countries where many young people have an economic necessity to take up jobs as soon as they leave primary school to support themselves and their families. However, the quality of the secondary education sector is critical in training the next generation of students who will go into more demanding jobs in management, or into tertiary education to provide highly skilled specializations for the economy.

From 1995 to 2010, number of secondary schools increased by 35%. Public schools hardly grew but Private sector schools increased 55%.

Tertiary education

Government opened up to private sector in 1992. Now within 18 years, there are around 50 private universities along with only 30 public universities. The University Grants Commission is in charge of monitoring this sector. There is also an authority called national university with which the stand alone degree colleges are affiliated.

Demand for higher education has been considerably more than supply of seats of public university. This contributed fast growth of Private universities.

The public universities face problems with completing sessions on time due to political clashes in the campus. The disruptions faced by public universities are unfortunate because it means that students from poorer backgrounds are forced to suffer a poorer educational experience.

On the other hand, private universities do not have the capital to invest in science teaching which requires laboratories or access to teaching hospitals, and instead, the private universities concentrate on humanities and business. This skews the specialization in the university system away from sciences towards humanities, social sciences, and business management.

There is a parallel system of education that critically addresses the absence of specific skills. In Bangladesh, this area of training is referred to as Technical Vocational Education and Training (TVET). The existing TVET system in Bangladesh is very small, taking up only 2% of the education budget. But in this sector also, there is no strategic policy encouragement to involve the private sector.

Findings in the role of a benevolent private sector investor

When we visited education board, we sought a checklist or a guideline or anything they have for the interested private sector participants. But they do not have any such package that serves as an informative direction. Only hopeful part of our visit is the person (school inspector) we were directed to talk, actually talked to us which seemed like an in depth interview.

There are some policy guidelines and the application forms have some rules and regulations written overleaf. But these were given to us, one after one, only when we kept waiting and asked more and more questions about rules and regulations about opening and running a school.

Later we reviewed the documents of a private school. There we found that inefficient bureaucracies and inadequate guidelines prevail in all aspects of approving and monitoring the schools.

Our findings can be summarized as following:

• Currently, there are no one stop, one volume information package

• The rules available are scattered and one has to avail it by insisting. They tell it verbally.

• They do not have any awareness building initiatives that inform the potential investor.

• The rules are vague, that means not clear, at many clauses.

• No private sector help desk. There are so many schools in the private sector but there is no dedicated official for daily official visitors from the schools.

• Private school management comes to the board for many official reasons and they do not get professional service from the board employees. While this is true, other side of the story is that they manage their approval by ‘managing’ the officials. That means the scope for non compliance remains wide.

• The guidelines are not written in English. So any foreigner cannot have quick understanding of the rules and regulations.

• The board is not IT enabled. They have a website, maybe built as part of one time government enthusiasm about IT, which is rarely updated. One cannot communicate or get response through email. So, foreign or nonresident Bangladeshis cannot communicate with the board.

While this picture of the educational boards is very typical of government offices of Bangladesh, it has very fatal implications for education sector. The most dangerous part of current situation is that this kind of weak regulatory framework –

Encourages malpractice and non compliance and
Discourages procedural compliance.

Bad investors with quick and high profiteering attitude take chance of weak regulatory situation and manage the officials and vague rules in their favor. In the education marketplace, people have few options and demand for seats in schools is tremendously high. So profit is quick and high for these bad investors. On the other hand, good investors are not good in managing or bypassing the policy guidelines (which are flawed in many instances). So they are getting out of way. This makes the overall situation an unhealthy one.

From reviewing government education policies and statements as written in the ministry of education website (www.moedu.gov.bd), this is clear that there is no mentioning of private sector as a means of increasing education reach to the people.

From reviewing the media reports, public attitude can be characterized by anger, frustration, and helplessness. Media reports these instances factually and the tone is negative. In this environment, the enabling environment role of government in private sector education becomes even more vague and questionable.

Recommendation for connecting private sector in education

Bangladesh needs more schools, quality education and quality teachers. There should be private schools which will add to competition. Profits should be viewed as normal and positively. Better schools will come up from increasing number of schools. Better schools will compete for better teacher. Salary of teachers will go up within the mechanism. Better Human Resources will come in teaching profession. The key to success in this model depends on the facilitating skill of the government. Government has to play a strong facilitating role and should do it systematically with strategic management process.

Government should inaugurate the process: The strategic process of involving private sector in education should start from the head of state. Prime minister and then education minister should publicly announce the strategy clearly that country cannot ignore the role of private sector in education and that the private sector participation is a must and will be encouraged.

Review existing policy and practices: The next step is to sit in meetings with different focus groups consisting of private sector school founders and education experts. The objective will be to critically review the existing scenario, policies and practices and find the gaps that are encouraging malpractices, discouraging compliance, and hindering the enabling environment.

Open suggestion from citizens: Along with step 2, education ministry should ask for open suggestions from citizens of all corners of the society. The objective is to broaden the opinion base.
Multiple communication channels – post, email, telephone, mobile SMS – should be there for taking in communications from the people.
The founders of school and also who founded but failed should be actively encouraged to share their experiences.
The outcome of this step is to find out various views and suggestions about what will make private sector willing to invest in schools and why some founders/entrepreneurs are not coming up in education.
Policy sent to review committee: at this stage a modified and improved version of the policy is almost done. But before sending it to the education boards for tactical level implementation, the policy may be sent to a review committee consisting of relevant stakeholders for inconsistency and gaps for field level.

Implementation of the policy by the education boards:
The country is divided into six regional education boards which act as the regulatory authority for all the schools in the respective regions. Now these boards will act as the executing agency of the private sector strategy of government.
Employees of the education boards, headed by chairmen of the boards, are characterized by typical government employee attitude – they lack basic managerial principles and also motivation. They should be given some cultural change training centrally by the education ministry and their performance should be somehow tied with ensuring private sector participation, for example,
how many new schools have been founded last year,
how many existing schools (unregistered) applied for registration,
how many schools applied for expansion into new classes and for increasing number of enrolments.

Media management: Media (print, TV, electronic) is important in a democratic society. Media should be convinced by the ministry of education and regional education boards about the private sector strategy of education sector and importance of uniform media support for successful implementation of the strategy.

Case 2: Increasing Tax Revenue By The Government

Introduction

Why the states need tax anyway? Tax is one of the main sources of internal revenue for any government. Also taxation is one medium of participation in government by the citizen – whatever the form of government is.

From the latest data of 2008, World Bank development indicators show that tax revenue as a % of GDP is only 8.80 (World Bank, 2009). In the OECD and EU countries which are mostly developed countries the average is more than 35%. So it is easily understandable, that developing countries have enough room for improving our tax revenue.

But collecting tax money has never been an easy job. There is a lack of integrated and cohesive approach from the government. That makes the job even more difficult and ineffective.

Strategic Intent of the NBR (government)

National Board of Revenue (NBR) is the executing agency regarding taxation. Quoting the NBR Chairman, a Daily Star newspaper report presented the strategic intent of the NBR. If we summarize the facts we get the following:

NBR is trying to improve the tax collection system by introducing simpler methods and technology.
A tax survey is ongoing to increase the number of taxpayers by 4 lakh within the current fiscal year.
It is trying to enhance the board's strength, and bring more transparency and accountability.
A move is under way to set up 'dedicated benches' in the Supreme Court to handle NBR-related cases and promptly collect the revenues in due (around taka 8000 crore). Also, there is a plan to introduce Alternative Dispute Resolution for out-of-court settlement of cases.
The tax administrator is working to introduce an online tax payment system by next month to upgrade the existing tax returns submission procedure. In this process, the taxpayers will be able to pay tax online from January.
The board now works to rationalize the tariff structure and remove anomalies in the taxation to encourage more taxpayers to submit VAT, customs duties and income taxes.
The NBR chief said they will set up a national data centre to provide adequate information to help taxpayers avoid hassles.

(Source: NBR chairman, found in a daily start report, December, 2009).

These steps seem natural for setting a strategic approach to managing the taxation system. It shows us the good intention (strategic intent) of the government. It provides a road map or a broad action plan to achieve organizational objectives (i.e., increasing tax revenue).

What Is the Experience and Perception On The Ground

Though the NBR strategic plans and actions are desired and give us hope for a well managed taxation system, our experience and observation shows a contradictory picture of the realities which undermine the good intention of the government.

General perception about the system

The media reports (print, television, web) about anomaly and inconsistencies in the overall tax system are widespread and they form a general perception. In addition to it, there are personal experiences of the individual citizens and small business persons. The overall perception can be summarized as follows: