Private business is seen as highly efficient. Many wonder why government can't function like that. The answer to it is that public administration has some limitations and at the same time, its structure is not same as private businesses. There is actually a huge amount of differences between government and business. Have a look:
1. In businesses, owners have the freedom to select any organization structure they deem appropriate for better efficiency. Some available options are bureaucratic, functional, matrix, divisional, virtual and so on. They can also design one independently. For government, bureaucratic structure rules the day. In other words, power flows from top to bottom and all job positions are clearly defined.
2. Being socially responsible is mere an option for a business. Most often, it is utilized to brush up the reputation of the company. For government, being socially responsibly is the main religion. In fact, all its goals are designed to provide benefit to the society.
3. Businesses focus only on a few products and services. Government has to focus on more than 100 products and services.
4. In addition to selling products and services, businesses can raise money by issuing stocks, bonds and taking bank loans. Government's main revenue sources are taxes and bonds. It too has certain parts that can generate money with sales. But they are less in number.
5. Government has the right to set rules for businesses. Businesses do not have the same right on the government. They can only influence laws by lobbying.
6. Main government officials are elected for 4 to 8 years and thus, they have very limited amount of time to work on their goals. Businesses can have 25 years or even unlimited amount of time.
7. Due to strict rules and regulations, and agreement with labor unions, Government cannot hire and fire employees easily. Businesses have better control on employees and offices. Hence, they can hire and fire without much constraint.
8. Government makes laws under heavy pressure from sub committees, judiciary branch and interest groups. Businesses make laws without such struggle.
9. Government is always under the scanner of the media. Thus, it is more transparent. Businesses have privacy and do not need to be transparent about what they do.
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| CEO's don't have to tell the general public about business issues and strategies. |
10. In a business meeting, the main topic is always related to making profit. Meanwhile, in government meeting, the main topic is always related to what has been done for the public, what kind of complaints came in and how to solve more social problems such as homelessness.
11. Government laws are intentionally kept vague so that agencies can interpret and apply them to a wide variety of situations. Laws made by businesses are clearer and specific.
12. Believe it or not, government can practice monopoly. There can't be two federal governments at the same time. There can't be two state or local governments either in the same place. Sure two states can compete, but they cannot invade each other. Businesses do not have the same luxury. If they practice monopoly they can be taken to court. However, they can buy or merge with other businesses.
13. Government is always under pressure to be fair with the public. Businesses need to please mainly the customers.
14. Evaluation of how government performs is not easy to do because of its focus on a huge number of issues and inability to achieve every goal. Some of the programs started by the government take years to show result. For businesses, profit and loss is the way to evaluate performance.
15. Decisions are usually slower in the government sector. In businesses, they can be taken quicker.
16. Despite having limited fund for most programs, waste in the government sector is common. For businesses, every dollar is valuable.
17. Majority of the government programs are free or promise some kind of discounts to public. Businesses like to sell. They can provide free products but in very limited quantity and only for a limited time.
18. In the government sector, the pay is less, but the jobs are mostly secure. In business sector, the pay maybe high, but jobs are not secure.
19. Government accounting is all about budget. Business accounting is mainly about profit and loss.
14. Evaluation of how government performs is not easy to do because of its focus on a huge number of issues and inability to achieve every goal. Some of the programs started by the government take years to show result. For businesses, profit and loss is the way to evaluate performance.
15. Decisions are usually slower in the government sector. In businesses, they can be taken quicker.
16. Despite having limited fund for most programs, waste in the government sector is common. For businesses, every dollar is valuable.
17. Majority of the government programs are free or promise some kind of discounts to public. Businesses like to sell. They can provide free products but in very limited quantity and only for a limited time.
18. In the government sector, the pay is less, but the jobs are mostly secure. In business sector, the pay maybe high, but jobs are not secure.
19. Government accounting is all about budget. Business accounting is mainly about profit and loss.
20. Government can respond to a problem when it becomes a big issue for the general public. Businesses respond to any problem deemed bothersome for a limited number of customers.
21. Government employees are not expected to work harder. In fact, doing so may mean getting lectured by another employee on how it makes the rest look bad. In business organizations, employees are not only expected to work harder, but also give their best.
22. It is not easy to be hired by the government. But once in, the job is pretty much secure. In business organizations, it is easy to get hired, but despite its permanent status, it has no security at all.
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21. Government employees are not expected to work harder. In fact, doing so may mean getting lectured by another employee on how it makes the rest look bad. In business organizations, employees are not only expected to work harder, but also give their best.
22. It is not easy to be hired by the government. But once in, the job is pretty much secure. In business organizations, it is easy to get hired, but despite its permanent status, it has no security at all.
You may also like:
Major Organizational Structures
Explanation of US Government Structure
Hospital Governance Structures
Span of Management With Examples
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