Aims of Businesses in the Public Sector

Businesses in the public sector usually receive some form of funding from the government to support them to operate effectively, however they are also accountable to them.
For example, the government fund schools and colleges to help them provide an educational service to the public but in return, expect schools and colleges to meet a certain set of standards and benchmarks etc.
Therefore, the mission, vision, and values of organisations in the public sector such as schools and colleges are heavily influenced by government expectations
However, they will also take into account the expectations of other stakeholders e.g. the people they are serving, which in a school or college would be the students.
Some of the key aims of public sector businesses include:

Service Provision in the Public Sector

One of the key aims of public sector businesses is providing adequate service provision that meets the needs and wants of the public it serves. In the public sector, the majority of services offered by organizations such as the police, fire service, Health Services, and education providers are typically free of charge and available to everyone. These services form the backbone of public welfare and societal support.

However, it's important to be aware that not all services provided by public sector organizations are funded by the government, and therefore they may not be freely available for everyone. For example, education providers often offer full-cost specialist courses, such as professional programs in marketing or accountancy, which aren't funded by the government (or may only be partially funded). In these cases, the student or their employer must pay for the course in full or at least contribute significantly. Similarly, the Government Health Services may also offer services such as teeth whitening and veneers which aren't available for free, even though they are provided by a public sector organization. This blend of free essential services and paid specialized services allows public sector organizations to maintain a wide range of offerings while focusing government funding on core, universally accessible services.

Cost Control in Public Sector Businesses

Although predominantly funded by the government, public sector businesses still need to control their costs to ensure they are sustainable and survive over the long term. Therefore, cost control is a key aim for businesses operating within the public sector.

Essentially, cost control focuses on managing outgoing costs and generating income to maintain a positive cash flow. Alongside running costs such as rent and electricity, it is pivotal that public sector businesses ensure the cost of providing their services is lower than the funding received from either the government or the customer paying for it. This relies heavily on the finance function to analyze the individual costs of the resources required to provide specific services.

For example, a teacher isn't the only cost required to provide an educational service; schools and colleges also need to pay for many other resources such as electricity, technology, equipment, and more. All of these factors must be considered when analyzing the cost of providing a service to the public, such as an educational course, to ensure it is economically viable.

By maintaining strict cost control, public sector organizations can continue to offer essential services efficiently while operating within their budgetary constraints.

Value for Money in Public Sector Services

Regardless of the type of business or the sector in which they operate, customers want value for money. Therefore, providing the public with value for money is an important aim for public sector businesses to ensure their services are utilized by the public.

For example, community transport organizations need to provide the public with a value for money alternative to options such as driving, like buses or trams. It's crucial that these organizations not only control costs but also set prices that would be considered value for money by the public using the service.

This balance between cost control and affordable pricing is essential for public sector services to remain attractive and accessible to the community they serve. By focusing on value for money, public sector businesses can ensure their services remain relevant, well-used, and beneficial to the public, ultimately fulfilling their core mission of serving the community effectively.

Service Quality in Public Sector Organizations

Even if a business operates within the public sector, it is judged by customers just as much as any other business regarding the quality of its service. Therefore, providing and maintaining a high service quality is a key aim for public sector businesses. Consumers of services provided by public sector organizations may become agitated and complain regardless of whether they have paid for it or not.

For example:

a passenger may complain if their bus arrives late,
an Health Service patient may complain if their scheduled appointment is changed or there are complications with their operation,
and a student may complain if they feel their teacher isn't meeting their expectations.

While public sector organizations are not often featured on review sites such as TripAdvisor, it is crucial that they collect regular feedback from consumers who use their services. This feedback helps them identify potential issues that leave consumers dissatisfied, allowing them to improve the quality of the service to meet the public's wants and needs. By focusing on service quality and actively seeking and responding to feedback, public sector organizations can ensure they continue to provide valuable and satisfactory services to the community they serve.

Meeting Government Standards in Public Sector Organizations

A key aim for businesses operating within the public sector is meeting government standards. Failing to meet these standards can have serious implications for the organization, such as increased scrutiny including additional audits and formal visits from government bodies, or in severe cases, complete cessation of government funding, leaving the organization defunded. Every industry has its own specific standards that must be met when operating in the public sector, managed by governing bodies acting on behalf of the government.

For example, in the United Kingdom, the Food Standards Agency (FSA) governs food and hygiene standards for businesses providing food and drink to the public, Ofsted oversees education, training, and welfare standards in the education and training industry, and the Care Quality Commission (CQC) governs standards of care in the health and social care industry. These standards are designed to benefit everyone in the industry, including the business and service users. Therefore, it's crucial that businesses are aware of these standards and adapt to any updates to ensure compliance. Meeting or exceeding these standards can also help businesses attract more customers and generate more revenue.

For instance, a restaurant receiving a 5-star food hygiene rating demonstrates very good hygiene standards and full compliance with the law, increasing customer confidence and potentially leading to increased footfall. Similarly, an education provider receiving an outstanding judgment from Ofsted indicates the highest quality education and care for students, which can lead to increased demand for student places as parents, guardians, and students have greater confidence in the institution's ability to deliver excellent educational opportunities.

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