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What does management science have to offer policymakers?

BASSO Olivier , CNAM Paris
Philippe Very , Professor of Strategy

Philippe Very, Professor of Strategy, Management Sciences, EDHEC Business School and Olivier Basso, Associate Professor, Management Sciences, Conservatoire national des arts et métiers (CNAM) discuss in an article originally published on The conversation  the many rich relationships between management science and policy-makers.

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14 Mar 2016
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A strange question, you might say. Management science deals with collective action within organizations, whether public or private, small or large, local or multinational, for-profit or not-for-profit. There are few a priori links with the political decision-maker. And yet, close examination reveals many rich relationships, as illustrated by the special issue of the Revue Française de Gestion in which we asked management researchers to examine the issue.

Private-public interactions

The first type of link, and certainly the best-known, is the interaction between the private and public sectors. Formal cooperation structures are developed within the framework of private-public partnerships. These structures are not always equitable in terms of the costs incurred. When a soccer stadium is built and operated by such a structure, then the resident sports team loses its place in the professional elite, it is sometimes the municipality, and therefore the community, that bears most of the costs inherent in this event. Such arrangements need to be carefully designed to share the risks.

Another form of interaction, often less formal, is the practice of lobbying by private organizations to influence public decision-making. Although lobbying is widely decried, it is nonetheless necessary for the political decision-maker to have recourse to expertise in order to reach a decision. Interaction is therefore unavoidable, the difficulty lying in preserving the general interest rather than interests.

Beyond these interactions, other links exist, such as exchanges between the private and public sectors: management systems and methods, developed in the field of private organizations, are transferred to public administrations, thus influencing political decision-making. Examples include consolidation accounting methods for local authorities, or the new State accounting system derived from the LOLF (Loi organique relative aux lois de finances). These transfers sometimes create more problems than they solve for local authorities and decision-makers. In particular, the new national balance sheet, which leads to an under-estimation of assets owned, can have a major impact on decision-making.

Stakeholder management

On the other hand, some private sphere management systems could be useful to policy-makers. For example, when it comes to structuring and regulating the new electric vehicle industry, where numerous stakeholders are issuing contradictory injunctions. Companies have methods for managing these stakeholders. Or to improve the process of evaluating public policies, where the contributions of management remain minor. Politicians could therefore make greater use of management methods, but choose them wisely.

Philippe Véry, Xerfi Canal Management science and politics.

Finally, the third type of link takes the form of a joint evolution between the public and private sectors. It answers the question: which company for which future society? Companies can play an active role in a societal project driven by politicians. For example, the development of CSR - Corporate Social Responsibility - within companies could contribute to achieving the objectives of sustainable development set out by the UN. In another example, the democratization of business, with greater employee participation, could help to deploy a social project based on social justice rather than utilitarianism. In the same vein, since the company is a space for collective creation, its statutes should also evolve in line with the social project.

At the center, the study of organizations

The links are therefore multiple and rich. They demonstrate the need to articulate the roles and actions of all parties, each retaining its prerogatives and field of action. They underline the contribution of management sciences to political decision-making, through their theories and methods, and through their object of study: organizations. Companies, NGOs and associations all play their part in shaping the global, national and regional order.

This extra-economic power finds little legitimacy in the doctrine of shareholder sovereignty alone, and requires careful examination. In addition to these reflections on the evolution of society and assistance to political decision-makers, the works presented in the Revue Française de Gestion invite company directors and researchers to take an interest in political philosophies in order to shed light on their logic of action and investigation.

This article is published in partnership with the Revue française de gestion.

This article is republished from The Conversation under Creative Commons license. Read the original article.

Picture on freepik.

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