Development

Administration
Chapter Two: Public Sector and Development
 The concept of bureaucracy
• In this chapter, the term bureaucracy refers to the body of employees in a large-scale organization. More
specifically, it refers to a body of employees in authority relationship within an organization.
• It is notable that the bureaucracy does not include elected politicians: it consists only of appointed
employees.
• The power of bureaucracy arises from its role in policy formulation and implementation.
• In developing countries, because of the weakness of interest groups and political parties, the bureaucracy
often comes to play an important role.
• The making and implementation of policy are also deeply interconnected to the functioning of
bureaucracy because the formulation of new policy requires an understanding of the successes and
failures which can be provided by members of the bureaucracy due to their wide experience and
knowledge.
• In other words, since members of the bureaucracy often stay in their jobs longer than politicians, and
since they have more detailed information, their advice on policy matters comes to constitute a valuable
contribution.
• In addition, communication and exchange of information between the government and the various
sections of the society takes place, to a large extent, through the bureaucracy.
 The concept of bureaucracy
• The bureaucracy comes to have an important role in policy formulation also because of the technical
knowledge possessed by it. There three main reasons for it:
• (i) growth of science and technology,
• (ii) expanding role of the state, and
• (iii) increasing complexity of the administration.
• The growth of science and technology changes the nature of agricultural and industrial production.
• For instance, agriculture nowadays requires the use of chemical fertilizers, pesticides, and high yielding
varieties of seeds, pump-sets and tractors.
• As a result, the formulation of agricultural policy requires knowledge of specialists in agricultural science.
• Similarly, specialists are required in areas like health, education, industry, control of crime, and so on.
• Hence specialists of almost all kinds are nowadays recruited as members of the bureaucracy and their
advice is depended upon the formulation of policies.
• The expansion in the role of the state makes for dependence upon economists, accountants, lawyers and
others since their advice is needed for regulation of the economy.
 The concept of bureaucracy
• As the role of the state expands, the administration tends to become bigger and more complex.
• Maintenance of administrative effectiveness and efficiency then requires persons having specialized
knowledge and experience of administration and management.
• Thus, specialists of various kinds in the bureaucracy come to influence policy formulation.
• It needs to be emphasized that policies often take the shape of laws.
• In other words, policy making requires not only deciding upon its ingredients but also formulating it in
the form of laws.
• The drafting of laws and rules necessarily requires specialists.
• Hence policy formulation or giving the shape of laws and rules to policies, is largely done by specialist
members of the bureaucracy are later examined and modified by ministers and legislators.
• However, ministers and legislators often do not have the understanding of the technicalities of scientific
and legal matters. Therefore, they usually depend to a large extent upon specialists in the bureaucracy.
• In this way the bureaucracy comes to influence policy formulation.
• formulation of policies requires the advice of persons who are impartial, or neutral, between the different
sections, in order to serve different interests of different groups in society.
 Enhancing Bureaucratic Capability
A) Personnel Development
• In the process of personnel development, The following personnel functions should be developed in light
of the country’s development strategy.
i) Classification, Recruitment and Placement
ii) Promotion and other Incentives
iii) Training
iv) Disciplinary Action
v) Appraisal
vi) Compensation and
vii) other functions
B) Organizational Development
• Organizational development can be carried out by:
i) Decentralization
ii) Delegation of Authority
iii) Reduction in Number of Levels
 Enhancing Bureaucratic Capability
C) Procedural Development
• The expansion of governmental function requires changes in the forms and periodicity of many of these.
D) Development Of The Society
• Various aspects of the society – economic, political, cultural and educational, should constantly improve.
Public Enterprises & Development
• Definitions of Public Enterprise: a public company is a company owned by the public.
• There are two uses of this term. One is a company that is owned by stockholders who are members of the
general public and traded publicly. Ownership is open to anyone that has the money and inclination to
buy shares in the company.
• It is differentiated from privately held companies where the shares are held by a small group of
individuals often members of one or a small group of families or otherwise related individuals (or other
companies).
• Public enterprises (PEs) includes:
• State-owned enterprises
• Parastatals
• Public undertakings
 Public Enterprises & Development
• The objectives of public enterprises are to:
1. adopt socialistic mode of control
2. control strategic sectors of economy
3. provide the required economic structure
4. control and manage essential services
5. undertake tasks beyond the means of private control
6. develop backward areas
7. increase the availability of consumer goods
8. generate development
9. control the exploitation of natural resources
10. Stabilize prices, etc.
 Types of Public Enterprises
• Types of PEs
• I) Legal Category
a) Departmental: Its based on type of services such as Ports, Harbors, Posts & Telegraphs, Railways,
Electricity & Water systems, ETC, Ethiopian electric Power Corporation, Addis Ababa Water & Sewerage
Authority
b) Public Corporation: It is public ownership of assets and interests
•   National Bank of Ethiopia
• Commercial Bank of Ethiopia
c) Commercial Companies ( company Act) is where the government is a more than 50% shareholder.
• Addis Mojo Edible Oils Co.
• Quality Food Co.
d) Government Contract with Private Agencies is public private partnership.
•  Awash construction Co.
•  Water Works construction Enterprise
 Types of Public Enterprises
II) Functional Category
a) Production and Trading Companies
• Industrial and Commercial Enterprises
b) Public Utilities & Services
• PEs supporting business and industry through provision of power, Water, Communications, Irrigation
c) Development PEs.
• Industrial Development Authorities River
• Basin Development Agencies
• Horticultural Development Enterprise
• Coffee Technology Development Enterprise
d) Applies Research Agencies/ Universities.
• Ethiopian Agricultural Research Organization Ethiopian Seed and Fertilizer Agency
 
 Types of Public Enterprises
III) Hierarchical Category
• PEs belongs to central government operating at federally and others may operate at regionally and locally.
• Sometimes it may have a complicated relationship between central and regional bureaucracies because of
the following reasons:
1) Policy Issues
• Motives and objectives, performance, Loss or profit are to be evaluated.
• Compare with the private sector Es.
• Some policy issues are:
a) Government – PEs relations.
• Government - decides purpose and method of operation
• makes statutes/Acts
• appoints Minister/Executive Managers
• evaluates performance
• Hence, PEs are accountable to supervision Authority which is accountable to council of Ministers which
is Complicated, complex but constructive relationship
 Types of Public Enterprises
b) Financial Management & audit.
• Financial flexibility, personal control, and insulation from bureaucratic and political interference in
administration of PEs
• Government subsidize PEs (service) PEs are exempted from regular government audit systems which
means they have financial autonomy to use, spend and borrow money; however, are to submit commercial
type of audit.
c) Linkages
• Relationships, and linkages between private sector and public sector.
Critiques on Public Enterprises in developing countries
• Insufficient growth in production
• Poor project Management
• Overstaffing
• Government interference
• Lack of continuous technological upgradation
• Inadequate attention to HRD, & R & D.
• Law rate of return on capital invested.
 Role of PEs in developing countries
I) Creation of social and economic overheads.
• Education, Health and Medical, water, Communication, Power, Irrigation etch are crucial for development.
Can not be left to private enterprises
II) Building basic heavy industries.
• Iron and steel, electrical & Engineering, beyond the means of private sector.
III) Optimum allocation of resources:
• For maximum social gains and state profit; unlike private sector
IV) Ensuring balanced growth among Regions, Reducing Inequality in Wealth Distribution.
• State is guardian of peoples’ welfare through which back ward regions; development unemployment, profit
adjustment, etc are taken care of.
  The Budgeting and Control of Public Enterprise
• Government undertakings which are financed wholly or in part by user charges are broadly classified as
public enterprise.
• These activities are conducted along private, commercial lines and are not customarily administered in the
same pattern as the traditional departmental activity of governments.
• Public enterprise has economic characteristics which are different from those of general government.
• The latter does not sell a government product in the market; the former does, the market in which
government product is sold is a special kind of market, differing sharply from that in which private firms
buy resources and sell product.
• The purposes of public enterprise activities and the varieties of ways in which governments conduct them
virtually defy classification.
• In some cases, commercial-type activity may be so mingled with traditional departmental activity that its
enterprise character is lost.
• Conversely, enterprise activity may be endowed with governmental authority but may in all other respects
remain private in nature, outside political control, outside budgetary control, conducting programs with no
discernible relation to other governmental programs.
  The Budgeting and Control of Public Enterprise
• There are two conceptually separable aspects of budgeting for enterprise activity. One is the internal
budgeting which an enterprise does, or should do, for management purposes.
• When a government undertaking derives its income from the sale of product in a fluctuating market,
internal budgeting is similar to that conducted by private firms, and its objectives are not very different.
• In these circumstances the preparation of the budget is a technique for coordinating the components of a
total program, and each component is geared to the forecast of operating revenue.
• Expense elements are analyzed in accordance with their functional relationship to changes in revenue. As
the budget is executed, and as revenues change, expenses can be controlled accordingly.
• Here, as with private enterprise, and unlike general government, revenues are not assured by legislative
action, but must be forthcoming from operations.
• Where government enterprise is conducted in departmental form or as an adjunct of departmental
activities, this kind of internal budgeting may be based on a working capita fund.
• This facilitates management control and may also simplify budgetary review by the central budget office
or legislature if departmental enterprise is subject to external control as well.
  The Budgeting and Control of Public Enterprise
• The second aspect of enterprise budgeting centers on the pattern of relationships running between the
undertaking and the general government sector.
• Budgeting is, among other things, a control over governmental operations and may be used to influence
and direct the components of a total governmental program.
• Budgeting may be used as a major tool for the centralized supervision of public enterprise – as a control
external to the enterprise, and thus for a purpose differing from the budgeting which may he used as a
technique for internal management.
• Where enterprise is organized in the form of a public corporation, budgeting as an external control may
involve the central budget office of general government, the chief executive, and the legislature.
• In this framework it is only a part of a larger pattern of relationships and controls, which may include
personnel, accounting, auditing, and procurement.
• It is this second aspect of budgeting on which attention is usually centered. The public corporation is
generally the focus of controversy due to the issue of autonomy versus central control, or central direction.
  
Features of Public Enterprises
• Common features of public enterprises are:
I) State-ownership
II) Legal and statutory
III) Each with a separate executive/managerial structure
IV) Autonomous of political control

Forms of public enterprises

• At considerable risk of oversimplification, three organizational forms of public enterprise may be
distinguished.
• First are the undertakings controlled by departmental administration that can be described as incidental
commercial activity.
• These may be almost wholly integrated with departmental finances or can be partially isolated and
financed by means of a working capital fund.
•  A second organizational type is the joint stock company, which is established under general incorporation
statutes with shares of common stock as evidence of ownership rights.
• The shares of stock may be owned by government, in whole or in part.
 Forms of public enterprises
• Control over the company may be exerted through exercise of the ownership rights attaching to the
common stock; or the government may refrain from exerting its ownership rights, and control may, for all
practical purposes, remain in private hands.
• In this latter case the undertaking may be as wholly private as if government had simply loaned funds to
a private corporation.
A third organizational form is the public corporation. In its pure form it has the following legal
characteristics:
(1) it is created by a specific statute for a specific purpose;
(2) there are no shares of common stock and therefore no shareholders;
(3) the government (Administration) is ultimately responsible for its management;
(4) a management group is appointed by the government and charged with its day-to-day affairs;
(5) the corporation has an independent legal status, is a legal person in the eyes of the law;
(6) the corporation is subject to specified standards of accountability to the government , including
financial accountability.
 Forms of public enterprises
• Public enterprises may also be grouped in accordance with the kinds of economic activities they conduct.
• Here there are two broad classes, those involving financial transactions and those involving goods and
service transactions.
• Financial undertakings may include banking, such as the central bank or commercial or savings banks
conducted by government; lending activities, which may be organized and conducted outside banking
channels, as with agricultural credit; and insurance, such as the underwriting of foreign loans or
residential mortgages, or life insurance for veterans.
• Goods and service activities may be roughly divided into production and sale programs and purchase and
sale programs.
• The prototype of the production and sale activity is the government owned and operated electric power
plant, or the nationalized railroad. An example of the purchase and sale type is a government marketing
board, or a government stockpiling operation.
• An important kind of public enterprise in some developed countries is the fiscal monopoly, which may be
either production and sale or purchase and sale.
• This is an undertaking organized to monopolize transactions, for instance, in salt, or tobacco, or alcoholic
beverages. The enterprise is conducted for revenue purposes and is expected to show a substantial surplus
each year, which is then budgeted as a part of government tax revenue.
 Forms of public enterprises
• Public Sector as a Whole
1) The market cannot guide, organize and discipline the public sector.
2) Decisions of the public sector are administrative and/or governmental but not market based.
3) There are no tangible and self-enforcing criteria for judging efficiency in the public sector.
• The performance of the public sector in developing countries, including Ethiopia has been facing various
developmental problems relating to planning, construction and commissioning of projects.
• These problems can be classified as those related to:
a) Public policy;
b) Institutional capacity development;
c) Public participation- citizen / government relations;
d) Project planning and management;
e) Other operational problems which include financial management (budgeting), human resource
development, service delivery innovations, marketing, industrial relations, etc.; and corruption -
unethical issues.
 
 Forms of public enterprises
• As a result:
• There has been considerable delay in project performance and an increase in the cost of the completion of
these projects which in turn has not only deprived the nation much needed goods and services but has
also put extra burden on the public institutions.
• As a result, the development approaches are more elitist (centralized type), more authoritarian (non
participatory by its nature) and so forth.
• Moreover, the basic pattern of public administration is imitative rather than indigenous in most of the
developing nations. Euro – American model is borrowed and implemented without looking local values
and realties.
• There is an abundance unskilled labor, which is characterized by unemployment or underemployment.
Bureaucrats are deficient in skilled manpower necessary for developmental programs.
 Development
Administration
Chapter Three: Public Sector Management
 New Public Management (NPM) Movement
• NPM is a label used both to define a general trend towards changing the style of public managment
carried out in several counties during the 1980s and 1990s.
• The evolution of new public management (NPM) movement has increased pressure on state
bureaucracies to become more responsive and democratic to citizens as clients.
• Modern societies begin to demand situations that are flexible and adoptive, that are change oriented;
democratic in functioning and client oriented (focusing on citizens, and collaboration with citizens as
partners (which means cooperation, participation, negotiation, agreements based on compromises and
mutual under standing).
• Moreover, they require government operation that is based on the marketplace view of better service for
citizens as customers.
• These paradigmatic shifts increase the tension on traditional state bureaucracies and public administration
to become more responsive to citizens.
• This is an important advancement in the cotemporary public administration, which finds itself struggling
in an ultra dynamic marketplace that is characterized by the competitive environment.
• All these paradigmatic shifts initiated a number of extensive administrative reforms to be carried out in
several counties during the 1980s and 1990s.
 New Public Management (NPM) Movement
• The NPM approach advocates the government that treating citizens as clients, that is a result-oriented,
competitive, a mission driven anticipatory, market-oriented, democratic and innovative.
• The definition of NPM is general rather than specific. It is not defined as a new form of governing but
rather it is a way of managing or administering public sectors with the past traditions.
• It promotes trends in public – managerialism that promotes manager – customer relationships in the
public area.
• For instance, the NPM approach advocates the idea of treating citizens as clients, or customers. In
essence, the motivation to meet the demands raised by citizens is equivalent to satisfying the needs of
regular customer in a regular business supermarket.
• According to this view, responsiveness in the public area closely complies with business-oriented
statements such as “the customer is always right” and “never argue with the clients’ needs.
• It includes elements of delegation, responsiveness, and collaboration.
 New Public Management (NPM) Movement
• NPM relies on the theory of the marketplace and on a business like culture in public organizations, for
example, in an extensive review of NPM literature, hays and Kearney (1997) find five core principles of
this approach:
• Down-sizing – reducing the size and scope of government;
• Mangerialism- using business protocols in government;
• Decentralization-moving decision making closer to the service recipients;
• Debureaucratiztion - restructuring government to emphasis results rather than process; and to emphasis
result rather than process; and
• Privatization-directing the collection of government goods and service’s to outside firms.
• Privatization is squeezing the public sector from two fronts:
• By shifting the public enterprises to the private sector
• By pushing the social security system towards market
• A major a belief among NPM advocates is that the state and its bureaucratic subsystems are equivalent to
a large private organization operating in an economic environment of supply and demand.
• In this sprit, a major goal of government is to satisfy the needs or demands of citizens, namely, to show
higher responsiveness to the public as clients.
 Reinventing the Government in NPM
a) Mission Driven Government
• Transforming rule driven organization
• The advantages of mission – driven government is that they tlet their employees free to pursue the
organizations mission with the most effective methods they can find.
• This has obvious advantages such as:
• Mission – driven organization are more efficient than rule –driven organizations.
• Are more: effective than RDO: they produce better results
• MDO are more innovative than RDOs Because RDOs stifle innovation, because there is always some
rule that stands in the way.
• MDO, are more flexible than RDOs
• MDO, have more morale than RDOs.
• b) Result – oriented Government:
• Customer oriented governments Put customers in the diverse seat
• The single best way to make public service providers respond to the needs of their customers is to put
resources in the customers’ hands and let them choose.
 Reinventing the Government in NPM
• Government also provides the listening techniques to listen to the voice of the customers – such as
customer surveys, customer follow – up, community surveys, customer contact centers, customer contact
reports, customer councils, customer interviews, customer service training etc.
• The advantages of this approach area:
• Customer – driven system (CDS) forces service providers to be accountable to their customers.
• CDSs depoliticize the choices-of-public service providers’ decision.
• Even in competitive service delivery systems, public service organization contact with various types of
providers.
• CDSs stimulate more innovation when service providers have to compete, they constantly look for ways
to cut their costs and increase their quality.
• CDSs give people choices between different kinds of services.
• CDSs empower customers to make choice, and empowered customers are more committed customers.
 Reinventing the Government in NPM
c) Enterprising Government
• Turning managers into Entrepreneurs
• Decentralized government
• Form hierarchy to participation and team work.
• The entrepreneurial leaders instinctively reach for the decentralized approach. They move many
decisions to “the periphery,” in to the hands of customers, communities and others.
• They push others “down below”, by flatting their hierarchies and giving authority to their employees.
• Decentralized institutions have the following advantages.
Centralized institutions Decentralized institution
Less flexible  More flexible they can and customers needs
Less effective  More effective they are participating in their working system
Less innovative  More innovative good ideas bubble up from employees.
 Generate higher morale, more commitment, and greater
productivity
 Reinventing the Government in NPM
• Advantages of Entrepreneurial public organization
• Promoting entrepreneurial spirits in the public sector:
• Decentralizing public organization through participating management
• Flatting the original hierarchy
• Establishing team work organization
• Conclusions of Reinventing government:
• Transforming Rule – Driven Organizations (Mission - Driven Government)
• Funding Outcomes, Not Inputs or Processes (Results - Oriented Government
• Meeting the Needs of the Customer, Not the Bureaucracy (Customer – Driven Government)
• Empowering rather than serving (Community - Owned Government)
• Earning rather than Spending (Enterprising Government)
• Prevention rather than Cure (Anticipatory Government)
• From Hierarchy to Participatory and Teamwork (Decentralized government)
• Leveraging - Change through the Market (Market – Oriented Government)
•  Steering rather than Rowing (Catalytic Government)
 Contemporary Public Management
• Today we live in an era of remarkable changes involving:
• Global marketplace, which puts enormous competitive pressure on different economic institutions
• An informed society in which people get access to information almost as  fast as their leaders do
• A knowledge-based economy in educated workers bridle at commands and demand economy
• An age of which marketing which customers have become accustomed to high quality and extensive
choice
• In this environment, traditional parochial institutions increasingly fail to meet emerging global
challenges. Therefore, today’s environment demands institutions and professionals that:
• Are flexible and adaptive;
• Deliver high quality goods and services;
• Are responsive to their stakeholders;
• Are offering choices of non-standardized services;
• Lead by persuasion and incentives rather than commends;
• Give their employees a sense of meaning and control; and
• Empower citizens rather than simply serving them.
 Reforms in Public Management
• Administrative being constantly involved in practical action situations can not afford to remain static. It
has necessity to change for the sake of sheer survival. Four principal goals of reorganization identified
by Mosher are:
• Changing policy and programs
• Improving administrative effectiveness
• Solving personal problems.
• Countering pressures and threats from outside environment of the organizations
• In order to implement these principles, there is a need for various type of reforms.
• Substantively, administrative organizations are composed of three interrelated elements, structure,
process and behavior.
• Administrative reform is often directed toward these three elements either separately or jointly.
1) Structural reforms: Reforms introduced to remedy organizational rigidity structural reform is very
common in public administration.
• The basic concern here is with alternation of structures & regulations, division of work, personnel
reshuffling; research promotion, delegation and decentralization, creation of autonomous agencies and
setting up of interdependent units, encouragement of innovations & initiatives & better public relations.
 Reforms in Public Management
2) Procedural Reform: Reforms introduced procedural simplification in administrative process.
• This may involve changes in financial rules, alteration of work procedures ( eg. Changes in filling
methods, form, etc.) and general attempts to avoid red-tape.
• Operation research, system analysis, etc. are now widely used in public administration. Automation with
New technology like the computer & data-processing machines are being used now-a-days to facilitate
better and quicker operations in government.
3) Behavioral Reform: Reform through changes in attitudes.
• Behavioral reform is a relatively new thing so far as government organizations are concerned.
• Bureaucracy has often been criticized for its impersonal character and dehumanizing consequences.
• Behavioral changes have therefore been suggested to improve interpersonal and inter group relationships
within the bureaucracy.
• Participative management and sensitivity training have gained wide attention in recent times in public
administration.
• It further aimed at creating an atmosphere of togetherness by offering opportunities of participation to
different grades of employee.
• Sensitivity training is directly oriented toward attitudinal change and has now become the trend in
government training institutions.
 Reforms in Public Management
• Looking toward the future of public administration, traditional bureaucracy and contemporary new public
management activities are not an adequate form of governmental organization.
• It requires some reforms to treat citizens as clients of the public system by illuminating some undesirable
dimensions in public administration (citizen relationships).
• Among these improvements are
• (1) the assumption of greater responsibility by government, toward citizens;
• (2) accountability in and transparency of the public-sector operation;
• (3) the idea that government actions must be continuously mentioned to ensure high efficiency,
effectiveness, and better economic performance; and
• (4) recognition that the government’s power must depend principally on citizens’ support, voice, and
satisfaction with the service they receive.
 Development
Administration
Chapter Four: Decentralization, Stakeholders
and Development
 Decentralization
• The term decentralization is being used interchangeably with terms like devolution, deconcentration
and delegation. But these concepts are different in degrees and forms for decentralization.
• i) Devolution (Political Decentralization)
• Devolution has political and legal connotation. It implies transfer of authority from Central / State
government to local governments.
• In devolution, the accountability is upward and downward – upward to the Central / state governments
and downward to the local people who elect them.
• If deconcentration and delegation have administrative connotations, devolution has political and legal,
then decentralization covers all aspects – political, legal / administrative.
• It is the decentralized mode of policy and program implementation which can involve people in the
development process.
• It is this process whereby centralization is recessed, so that power of decision –making is shifted from
central, political and administrative bodies to a multitude of quasi – autonomous bodies, concerned with
the formulation and application of policy in particular regions and in answer to local requirements.
• Political decentralization leads to the creation of local government organizations, with public
representatives as members of these bodies.
 Decentralization
• They are assigned the responsibility of public representatives as members of these bodies.
• They are assigned the responsibility of developmental tasks, at that here; decentralization takes the shape of
devolution.
• Devolution to local self-governing bodies is an attempt to set up autonomous governments at the local
level.
• These local self –governing bodies which are elected locally to determine local policies and implement
them are, in a fundamental way, detached from the central / state government. If these local self –
governments cannot exercise autonomy, devolution will remain more in theory.
ii)) Deconcentration (Administrative Decentralization)
• Deconcentration implies the transfer of authority in geographical term; from headquarter administration to
field administration.
• Deconcentration involves the redistribution of administrative responsibilities. And in deconcentration,
accountability is upward. That is, the local bodies are accountable to the headquarter administration.
• Administrative decentralization is motivated by efficiency criterion in the sense that through a process of
deconcentration, field administrative units are being set up.
• Thereby, field level decision –making is made possible which leads to prompt problem – solving.
• Here, units of local government (for example zonal/woreda administration) are connected organizationally
 Decentralization
iii)Delegation
• Another form of decentralization is the delegation of decision – making and management authority for
specific functions to organization that are not under direct control of central government ministries.
• Often the organizations, to which development functions are delegated, have semi – independent
authority to perform their responsibilities and may not even be located within the regular government
structure.
• Public corporation and regional development authorizes have been used extensively in developing
countries to execute development schemes.

Hindrance to Decentralization
• There are many problems which are being faced in the developing countries, problems which pose
obstructions in the way of democratic decentralization.
1) Problem of Coordination
• The purpose of democratic decentralization is to provide more discretion at the local level to meet unique
local needs, and to generate innovative solutions to development problems.
• For this, proper coordination between and among different units is essential. This way, the effort and
material resources invested would not go waste, leading to an integrated development without any
friction, overlapping and duplication.
 Decentralization
2) Problem of Perception
• If democratic decentralization is to be effective, the central administrator’s perception of their role has to
undergo a change.
• They should understand that their task is to provide support and facilitate the work process. But many a
times, they feel that their task is to control. And thus, friction arises.
3) Unit of Administration
• The basic problem of decentralization is with regard to the unit of administration.
• A number of factors such as geographical area, population, resources, level of development etc, have to
be taken into account while deciding about the unit of planning and development.
• It should not be too big leading to unwieldy situation, nor too small which would result in defeating the
very purpose for which it was set up.
4) Weak communication network
• Absence of the involvement of grass root organization in the upward communication is weak in most of
the developing societies.
• And this leads to unrealistic policies and unattainable targets. The problem of red-tape, overlapping,
duplication are generally there in most of the developing countries.
 Decentralization
5) Bureaucratic leadership
• Leadership is another important variable which can make significant difference to the developmental
process.
• An examination of the type of leadership in most of the developing countries indicates that this has been
one of the major limitations on their effort for development and decentralization.
• Further it reveals the following characteristics:
1) The bureaucratic leadership is strengthened and perpetuated.
2) Wherever political leadership is involved, they strengthened either the traditional leadership or the
traditional leaders stepped into the new role emerging from the developmental effort.
3) The leadership at the higher levels of organization is strengthened while the leadership at the lower levels
did not receive much attention.
An assumption is that those who occupy key positions at higher levels are more competent than those
working at lower levels appear to be dominating the elite thinking.
4) Adequate opportunities have not been provided for the emergence of new leadership.      
• Since the local organizations are not strong, these do not appear to be many opportunities for the
emergence of new and committed political leadership.