In Search of Prudence: The Hidden Problem of Managerial Reform

Abstract

This article argues that the concept of prudence can provide valuable insights into the problems of the New Public Management. Prudence, or practical wisdom, is the ability to make sound decisions under complex, ever-changeable conditions. Old-style bureaucracy severely limited the discretion of most administrators but preserved a site of true prudential judgment at the peak where discreet "mandarins" policed the boundary between politics and administration. The reforms that inaugurated New Public Management dismantled this site of prudence while simultaneously attempting, in effect, to disperse prudential judgment and action throughout the service. Though raising the problem of prudence, these reforms misconceived it as the problem of how to balance new freedoms with new controls to prevent abuse or folly. This essay argues that the introduction of market mechanisms, risk-management and cost-benefit techniques, ethics training, performance accountability, and calls to leadership were destined to fail because they misapprehended the problem of prudence.