Strategic management in the public sector

The growing size of the public sector and its key role in the economic wellbeing of any nation make this sector a critical area for management research. In particular, it is important to develop an appreciation of the differences between the private and public sectors and determine whether these differences impact on an agency's ability to implement strategic management. There has been significant reform in the Australian Public Service in the last decade with the adoption of a range of more strategic practices. It is not yet at the stage, however, of fully embracing strategic management. Due to the influence of this sector, and the increasing public scrutiny of management practices in this area, it is not unreasonable to look for an explanation of the delay in the adoption of strategic management practices in the public sector.The objectives of this research are to: a) Examine the development of strategic management in the private sector; b) Outline strategic management developments in the public sector, both in Australia and other OECD countries; c) Critically assess the commonly quoted differences between the private and public sectors and determine whether these factors contribute to problems in implementing strategic management in the public sector; and d) Propose a strategy to move towards strategic management in one sector of the public service. The author has used the conclusions of the research to develop a management solution for a particular Department in the human services field which has experienced little progress in strategic management. This solution could be applied in a range of similar circumstances.