The difference of opinions between the sectors as to whether employees in one sector are more or less motivated than the other, or whether bureaucracy stifled innovation may be expected as a defensive response in support of the group. However, other areas of dissimilarity spoke to the heart of this research and must be addressed if public-private partnerships within the municipal water industry are to grow at a faster rate with greater public sector acceptance. The research was designed to gain new insight into the following questions:
1. Are there significant, measurable differences in the "soft facts" that public sector and private sector managers apply to similar decisions?
2. If these differences exist, do they pose significant barriers to the efficient use of private initiatives to solve public sector problems?
This survey analysis has determined that there appear to be significant, measurable differences in certain "soft facts" that public sector and private sector managers apply to similar decisions, and that these differences pose significant barriers to the efficient use of private initiatives to solve public sector problems. Specifically these areas of critical difference are found in the public sector's questions regarding the profit motivation of the private sector along with disagreement between the groups as to the importance of employee pay and motivation compared with managerial planning and control in achievement of goals and objectives. Furthermore, the wider distribution of responses among the public sector participants seems to indicate a greater divergence of views within that sector on these key issues.
In reaction to the distribution conflict regarding short-term profits this researcher asked, "Is maximizing short-term profit the primary goal of private sector management?" An analysis of the literature seems to make a case for "reasonable" profits over short-term profits. Solomon states that the purpose of the corporation is to serve the public, both by way of providing desired and desirable products and services and not by harming the community and its citizens (Solomon, 1993). Bennett and DeLorenzo point out those private, profit-seeking businesses must pass a market test by satisfying consumers and by providing a product that is competitive in quality and in price (Bennett and DeLorenzo, 1989). Catchings and Foster suggest that the view of the private sector can be expressed in the belief of leaders of industry, economists, and statesmen generally, not indeed that unrestricted profit-making is essential - for there is no such thing; but that profit-making, under such restrictions and conditions, and subject to such taxes as may from time to time become desirable, leads to the creation of greater wealth than any other feasible economic system that has ever been tried on a large scale, or even suggested (Catchings and Foster, 1925). In other words, the private sector in general is motivated to attain the maximum sustainable profit within a given set of constraints, and, though the constraints may vary, they will be found in all economic environments. If the pursuit of short-term profits is not the primary goal of the private sector, then where do public sector managers find support for their views on profit? Certainly, the private sector encompasses a wide range of endeavor, and, although its successes can be magnificent in terms of improvements in our national economy and overall quality of life, its failings can be massive and far-reaching. Events such as the collapse of Enron Corporation or any of the various recent Wall Street scandals involving insider-trading are widely broadcast, impact many individuals and give rise to concern in all sectors as to the motives of the modern day business manager. This doubt is reinforced in public sector publications that make statements such as: "Government can improve as a result of adopting some business practices. But we should not ignore the major differences between business and government, differences that require government sometimes to reject the opinions of its customers, the voters. Government is not a business. Business has one primary goal: maximize profits… Nevertheless the goal in business never changes: make as much money as possible" (PM Commentary, 2003). Private sector failures and repeated statements such as this in public sector publications have an impact on the opinions of public sector managers in large part due to the fact that they provide a reinforcing social influence on group thinking and bring about increased group biases, and at a fundamental level, group decisions reflect the outcome of a social influence process that can revise the preferences of individual group members (Bohlmann, 1996).
The second serious conflict in responses centered on the importance of employee pay and motivation compared with managerial planning and control in achievement of goals and objectives. This researcher believes that in large part the explanation for this conflict arises from a basic difference between public service and private endeavor. In the public sector, profit cannot be measured in economic terms; therefore the emphasis is on administration rather than management. Administration is a discipline that possesses many of the attributes of management, but places its emphasis on task completion rather than the achievement of increased economic value, a condition that Drucker alluded to when he stated, "It would, therefore, seem appropriate to stress that the first criterion in identifying those people within an organization who have management responsibility is not command over people. It is the responsibility for contribution. Function rather than power has to be the distinctive criterion and the organizing principle" (Drucker, 1974). Quinn reinforces this opinion with his observation that in the private sector there have been some attempts to specify the ends that managers most often seek. The ends identified in those studies include maximizing profits, maintaining efficiency, promoting high morale, producing effective subordinates, high production, organizational growth, industrial leadership, organizational stability, social welfare, and innovation. While some of these criteria of performance apply to the public sector, many do not (Quinn, 1978).
In response to questions posed by the researcher regarding these conflicting views Wiff Peterson, Senior Vice President of Aquarian Services, Inc., observed, "The public system is geared to minimizing risk and protecting against abuse. In doing so the tradeoff is either reduced effectiveness or efficiency. To achieve high service levels demands more of management and normally comes at the cost of reduced efficiency. It's near impossible to achieve the same service level at the same cost as the private sector. You can have one but not both… The more managers in each sector can understand the strengths and weaknesses of their two systems, and come to respect the management skills, shared values, and common goals they have the more likely they will achieve success together." Responding to the same questions Charles Strom, City Manager of New Rochelle, NY, countered, "I think private sector managers have an overly high opinion of what they do. I would argue that public sector managers are more cost-effective given the general lack of revenues that they have to work with." Allen Cohen, Vice-President of HDR Engineering, offered, "Competitive pressures, in either the public or private sector, are a means of achieving efficiencies and goals. Public sector management and employees can and do respond to such competitive pressures - either real or politically induced. On the other hand, private firms that create strong economic incentives for management and employees can be inefficient and fail. Often these economic incentives create very negative and severe consequences (e.g., Enron)."
If these conclusions are correct, then the relatively slow growth of public-private partnerships within the United States may be attributed in part to the need to match a willing company to a proper opportunity in an environment that includes a willing political authority plus a public sector manager that understands and accepts entrepreneurial factors as a desirable and controllable trait. Given the natural volatility of any political environment and the findings of this research, only a small number of successful matches would be anticipated in a given year.