Practise distinguishing private- and public-sector organisations by ownership, objectives, and characteristics using case evidence for IB Business Management SL.
Creative Software Systems (CSS)
Creative Software Systems (CSS), a private limited company, designs custom software packages for public sector organizations. Ebru Aga is the sole shareholder, though she is considering an employee share ownership scheme.
For years, CSS managed its employees closely, setting individual targets for performance and requiring regular progress reports. Following Adams's equity theory, CSS tied financial rewards to frequently measured performance outcomes. Though managers clearly explained to individual employees how additional financial rewards were linked to specific contributions they made, many employees still felt the system was unfair.
After reading Daniel Pink's theory of motivation, Ebru reconsidered her management style and CSS's system of financial rewards. She liked when Pink reported that a major American company allowed employees to work 20 % of their time on projects of their choice. Ebru implemented the following three changes:
- Change 1: Adopting a project-based organizational structure for CSS projects.
- Change 2: Eliminating performance-related pay (PRP).
- Change 3: Allowing employees to spend 20 % of their time on any project they wish, either one of CSS's or their own "dream project".
Employees' reactions were mixed. Some employees were thrilled. They had many ideas of their own that they wanted to explore. Other employees, however, did not like the change. In the 20 % of their time given to any project they wished, they chose to work on projects given to them by CSS. They felt it was unfair. Although they were advancing important projects of the company, they would no longer get performance-related pay (PRP), while others spent their time on projects that might not contribute to CSS's profitability.
Define the term public sector.
The public sector involves those areas of the economy that are provided by the government and typically include what is deemed government itself (local, regional, state, national) and the various services provided by government, including education, health care, public transportation, police, fire brigades and other functions.
Award [1] for a basic definition that conveys partial knowledge and understanding or if the candidate merely writes the formula for calculating contribution.
Award [2] for a full, clear definition that conveys knowledge and understanding.