Conceptual Structure of New Public Management～Design Methodology of New Public Management and System Maintenance～
Seigo NASU
Director of Research Center for Social Management
Professor of Infrastructure Systems Engineering / Entrepreneur Engineering Course
185 Miyanokuchi, Tosayamada-cho, Kami City, Kochi Prefecture 782-0003,JAPANTEL：81-887-57-2792
FAX：81-887-57-2811
E-mail:nasu.seigo@kochi-tech.ac.jp

1. Background of New Public Management
In general Management of social capital has to be discussed as a system of New Public
Management (NPM), since public service for citizens are mainly provided by social capital of softwareand hardware which is also the major investment of the government. Appropriate management of social
capital has to be derived from the investigation on NPM and social capital which is related withinvestment and operation.
It is difficult to identify one definition of NPM since researchers and critics have their own
definitions. Some definitions have a specific and systematic concept such as an actual process, decision
making and evaluation standard for public management target. On the other hand, at Japan and at manyother countries definition of NPM varies very much, although necessary functions of NPM can be
defined as follows.
1) Enable efficient public management and investment
2) Enable selection of optimal countermeasures for public target
3) Fulfill accountability and process transparency
In order to provide a new concept of NPM for social capital, it is necessary to summarize andevaluate methodology or process of existing what is called “NPM” systems. Public management can bedivided to investment/planning work and routine public service work as well as investment planningand public administration.
Planning procedures for investment are to make an appropriate investment plan, to execute a plan,and to improve a plan which themselves are the procedure of the NPM. On the other hand, appropriate
public service works are output of the improvement procedure of NPM systems as well as that ofinvestment plan. The traditional management improvement cycle of the private firms which is wellknown as “Plan Do Check Action” cycle is what deployed at public management for the same
improvement purpose. Either for investment plan or for public service works fundamental procedure
and activities are the same as shown below.
Social capital or infrastructures from hardware to software are to be planned, to be constructed, andto be operated, to be maintained in a single management system in order to provide public services tocitizens for a long term efficiently and steadily. As a result of NPM system, investment plan has toassure future service level and efficient maintenance, and maintenance system has to assure optimized
function to maintain service level efficiently. Asset Management System for Social Capital or
infrastructures is an actual example of the output of NPM system procedure for efficient management
system.

２．New Public Management and Logic Model
In order to construct NPM system for strategic target, theoretical relationship between strategic
target and actual countermeasures or services has to be investigated in multiple points of view such ascost and benefit. Theoretically obscure relationships do not provide us accountability for thegovernmental budget, and it result in that citizens become skeptical to the public management.
Logic Model describes how actual countermeasures and investments are theoretically connected to
final strategic target, and it also functions in multiple ways for NPM procedure and policy/strategy
evaluation systems.
Program Logic Model introduced at “Logic Model Development Guide” published by W.K.
Kellogg Foundation is an example of Logic Model, which is defined as, “Basically, a logic model is asystematic and a visual way to present and share your understanding of the relationships among theresources you have to operate your program, the activities you plan to do, and changes or results you
hope to achieve. “ However it is not designed for actual function and procedure which are essential
factors of NPM.
Here, a new definition of “Logic Model” is introduced to define NPM system structure. The Logic
Model for NPM which provides Asset Management System of social capital or infrastructures has tofunction as a theory that explains which budget expenditure, investment or countermeasure isappropriate to fulfill public management target, as an evaluation standard for the selected portfolio ofthem, as well as a total management structure, and that is why its definition is very important.
[Five New Definitions of Logic Model for NPM]
No1. : Logic Model is a theoretical description of relationship structure among strategic managementtarget as an outcome and performance of investment, services, countermeasure as outputs. It
theoretically explains how these outputs relate and contribute to an outcome.
No2. :Logic Model is a management structure itself, since it explains the theoretical relationship andthe portfolio of investment, services, and countermeasures which public management has to
execute.
No3. :Logic Model is able to be applied for evaluation of the portfolio performance andaccomplishment rate of strategic management target, since it dose not only show relationshipbut also can show that quantitatively.
No4. :Logic Model is a management structure which is designed to function under social circumstances,environmental circumstances, technical circumstances, so that Logic Model can be applied
for revision or confirmation tool of management system.
No.5 :The investment, services, countermeasures selected to form output of Logic Model is a portfolio
to accomplish strategic management target.

Concept Structure of NPM
Operation system of infrastructures or services

Logic Model(Primary system)

Evaluation systems for sustainability, risk,
environment, efficiency (subsystem)

Maintenance cycle corresponding to
the socio-economical circumstances
and technical background or standards

NPM
maintenance
SystemEstimation system for each investment or
infrastructure such as cost versus benefit（third level system）
System evaluation forchanging conditions
Logic Model

Figure.1 How Logic Model is related to NPM system

３．Logic Model for New Public Management
Public management starts by setting the strategic target either politically or administratively. For
example if some local government set a strategic target to vitalize local economy and citizens life as a
primary outcomes, they have to be connected to lower outcomes, which also have to be connected toactual investment, services, and countermeasures. If effect and cost of these investment, services, andcountermeasures can be measured and evaluated numerically, and if outcomes can be defined bynumerical indicator, hole logic model can be defined as a numerical function which enable primary
outcomes to be evaluated. Table.1 shows an example how relationships among outcomes and outputs of
Logic Model can be defined numerically.

■Logic Model for regional economy and citizen’s amenity● Political Target: vitalize economy and life
Primary
OutcomeLife amenity

Increase income

Secondary
Outcome Ti me saving

BypassActual construction
countermeasures

Easiness of moving

ETC

Info. environment

Strict ban ofPedestrian Optical fiber
illegal parking Road const. For info. HW Y

Figure.2 Example of Logic Model
ETC: electric tool system●Target: vitalize economy & life
What kind of outcome
should be selected？

How to measure andevaluate the outcome？

Relationship between
primary outcome andsecondary outcome.
(How to connect them?)

Primary Outcome（Increase Income）

Income per person

Income tax data orquestionnaire

Secondary
Outcome(1)⇒（ Time saving ）Total effect of timesaving ofcountermeasures

1)Time saving by reduced
traffic congestion2)Info, environment to savetime (questionnaire)

Saving time is estimated as
money value. Average timevalue is based on statistics
or questionnaire

Secondary
Outcome(2)⇒（Info. environment）

Efficiency and qualityof link to information
or better quality job .

Evaluation by questionnaireof actual effect on impact

Research on relationshipbetween efficiency andquality of Info. and impact
such as increase of incomeof efficiency

Countermeasure
Evaluation(1)⇒（Bypass Construction）

Time saving effectNetwork simulation for
new Bypass construction

Evaluation(2)⇒（ban of illegal parking）

Time saving effect byreduced traffic congestion

Social Experiment andimpact observation

Evaluation(3)⇒（Optical fiber Info. HWY)

1)No.of using Info. HWY2)Time saving per person

Time saving and efficiency
gain by questionnaire

Evaluation(4)⇒（ ETC system invest.）

Time saving effect byreduced traffic congestion

Social Experiment andimpact observation

Table.1 Example how to make numerical Logic Model
For example primary outcome “income per person” is able to be measured and be evaluated withstatistical data, which can be related to Secondary outcome “time saving” by statistical relation function
between time and income, or related survey. Secondary outcome “time saving” is able to be integrated
with time saving effect of each countermeasure which can be modeled as a numerical function either bymeasurement of social experiment or by survey.

４．NPM procedure and how to apply Logic Model
The NPM procedure associated with Logic Model is introduced. Once the policy or political vision
is set, their appropriateness has to be checked by marketing and by socio-economical survey, withwhich outcome for policy or vision is structured by setting Logic Model. At the Logic Model broader
policy or vision requires multiple layers of intermediate outcomes to reach actual investments, services,and countermeasures. Here, purposes of surveys can be divided to seeds or needs finding, anddeveloping numerical functions of effect and cost evaluation. And numerical function of quantitative
indicator has to be developed to evaluate effect and cost of investments, services, and countermeasures.
With all these development of Logic Model policy or vision outcomes can be evaluated numericallyand government is able to sustain their accountability for necessity of individual investments, services,and countermeasures.
Once logic model is developed, existing social capital, infrastructures, or service systems have to beevaluated whether these are enough or used properly to accomplish primary outcomes as strategic
targets without any new spending. This procedure is able to eliminate unnecessary investment andmanagement system. After these procedures possible alternatives have to be developed in case existingsocial capital, infrastructures or service systems are not enough, with which the portfolio of their effects
is evaluated with Logic Model. At the same time Logic Model has to be tested whether theoretical
relationship among outcomes and outputs are appropriate with the proposed portfolio.
Effect evaluation of portfolio should not be done just for the selection of outcomes but for theinvestment or expenditure level of each countermeasure, or even for the methodology of investment oroperation. Efficiency of investment as benefit by cost is not just indexes for countermeasure evaluation.
They are to be used for integration of total effect and cost to evaluate rate of outcome accomplishment,
as well as investment risk and other necessary standards.
Setting Policy or VisionMarketing needs

Citizen’s
Intension & magnitude

Outcome for Policy/Vision
Numerical Outcome Index

Setting Logic Model (LM)Set Numerical Model of Logic Model (LM)
Propose evaluation method for Policy,
Countermeasures⇒Social Experiment, Questionnaire, etc.

Base Line Check

Check the maximum use of resources by LM
Adequateness check of LM

Multiple Countermeasures set

Performance evaluation by LM

Determine Portfolio of
countermeasures

Performance evaluation by LM

Execution and observing
performance⇒benefit per cost, sustainability,
investment risk
Public Involvement

Revise Policy/Vision and Countermeasure Portfolio

Figure.3 NPM procedure and Logic Model
The selected portfolio of investments, services, and countermeasures, or their operation
methodologies has to be the output of the NPM procedure including development, operation, andmaintenance of infrastructures, whose performance has to be evaluated on the procedure of theexecution whether the Logic Model has a theoretically and effect-quantitatively appropriate
relationship. Evaluation may result in the review of Logic Model and policy or vision. Even thoughoriginal Logic Model is appropriate, it may become inappropriate under the changing social

circumstance, and other circumstances such as culture, economy, environment, and technology.
Therefore the New Public Management cycle has to be constantly activated for the review of policy,
vision, and outcomes. Through these procedures accountability to citizens is able to be sustained, which
is a major purpose of NPM.

５．Policy Logic Model for Social Capital Investment PlanAs already explained, Social Capital Investment Plan is an output of NPM system and Logic Model
which consists of theoretically connected layers of outcomes to accomplish strategic target or a primary
outcome. Therefore Logic Model itself has a hierarchy of multiple Logic Models.
The most fundamental Logic Model is a “Countermeasure Logic Model” which has a relationshipamong countermeasure outcome, and output produced by each investment, service, or countermeasure.
On the other hand, some intermediate Logic Models connect “Countermeasure Logic Model” to the“Policy Logic Model” which explains the primary outcome of policy or vision.
Policy Logic Model
Intermediate
Logic Model
Countermeasure
Logic Model

Primary Outcome

Primary Outcome

Intermediate

Intermediate

Intermediate

Outcome

Outcome

OutcomeInvestment

ServiceCountermeasures

Countermeasures

Figure.4 Structure of Policy Logic model
These Logic Models have to be developed at each level of governmental planning. Development
plans of infrastructures generally consist of long term, middle term, and short term. In case of
infrastructures, Logic Model has to have an identical theory structure of Infrastructures development
plan, where outcomes layers of infrastructures generally have to correspond to the planning levels andplanning periods.
Revision of infrastructures development plans though the New Public Management procedure isable to be proceeded by Logic Model. At the first step rate of outcome accomplishment have to bechecked and whether it is done by the developed Countermeasure Logic Model. At this stage if theselected countermeasures, investments, and services have to be revised, while compatibility check
among short term plan to long term plan has to be executed. At the second step in case Logic Models
can not predicted the outcome results, their theoretical and numerical relationship have to be revised. At
the third step Logic Models themseives have to be revised including the alternation of outcomes,
outputs, countermeasures, and their relationships, which means a total revision of Policy Logic Model.

Infrastructures Plan and Policy Logic Modelat each planning period
Policy Logic ModelLong term
Plan
Review for thechanging
Circumstances

Review
by Policy Logic Model

Policy Logic Model
Middle term
Plan
Review for thechanging
Circumstances

Compatibility Checkby Policy Logic Model

Policy Logic Model
Short term
Plan
Review for thechanging
Circumstances

Figure.5 Plan review by Logic Model
These revisions of development plan of infrastructures is enabled in more precise manner by the
Policy Logic Model which is structured with engineering based quantitative measurement andevaluation for effect and cost, so that engineers should contribute more to these fields as their
responsibility.

６．Asset management System for Infrastructures and System MaintenanceIn the field, where social capital maintenance management is actually carried out, efficiently
preserving stability with a limited budget is the most essential task. On the other hand, from theperspective of building, managing, and administering social capital with the purpose of maintaining aconsistent service level, the efficient and effective execution of the entire budget is of primary
importance. Each type of social capital naturally requires different kinds of asset management andphilosophy.
Also, when considering the positioning of asset management within the administration, its relation
to social capital management and supervision, as well as its relation to policy evaluation andaccountability should be verified and the direction of social capital asset management must be clarified.
Though there is no universally accepted definition of asset management in social capital, when
thinking about its role, it is important to clarify its position within administrations and define its scope.
Taking the philosophies of various institutions in various countries as starting point, and considering
the functions necessary for the development, maintenance, and management of social capital in Japan,
we may define asset management as follows:●Asset management definition (maintenance management view point: narrow sense)
Asset management is the execution of efficient and effective maintenance management by keepingsocial capital in a sound condition, checking its soundness through periodic inspection, etc. in order tocontinuously offer services to users, along with managing lifecycle costs, etc. Note: written referring to“Asset Management Primer” by the U.S.A. Bureau of Transportation●Asset management definition (broad sense)
Asset management distributes a limited budget according to an optimum portfolio to achieve theneeded outcome or maintain the value or service level that is needed for each social capital element,
including the development of future social capital. An asset management system is a system to manage

budget and asset evaluations in order to achieve this goal.
●(Efficient) portfolio definition
This denotes the optimum combination of recipients of limited assets in order to avoid risk and acquire
the targeted effect in addition to that effect.
Periodic inspection system~Set the items and frequency foreach structure

Special check and inspection

Soundness level evaluation system(Inspection and evaluation DB)

Deterioration
prediction/maintenanceand repair plan system~Target structure special plan creation(Expert committee method)①Serviceability (service level)②Structure collapse danger level③Third party damage danger level

Execution of systematic
maintenance and repair
Complimentary systemfor policy evaluationand management(asset value/social benefit
management BD)

Conduct individual deterioration
prediction and Maintenance repair
plan based on individual LCC

Expense management system (Budget
management DB)
Asset management system(Asset value management DB)~Asset value assessment by maintenance expenses~Service level or outcome evaluation by
maintenance expenses (asset value/service level)

Figure.6 Basic system of Asset Management System
Basic strategic target of the Logic Model for Asset Management of infrastructures is to maintaininfrastructures for services with which 1).satisfaction, 2).stable provision, and 3).efficiency as basic
outcomes have to be provided to citizens. Countermeasures for these outcomes are 1).physicalrehabilitation, 2).physical renewal, 3).new construction, and 4).inspection system related to thesecountermeasures. Asset Management System which consists of combination of these countermeasures
is an output of NPM System.
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Figure.7 What should be checked for System Maintenance
Even though Asset Management System is properly designed for the outcomes, it is obvious that
Asset Management System will not provide services to citizens properly if 1).social circumstances,2).environmental circumstances, 3).technical circumstances, and 4).technological standards changes.
Asset Management System and its Logic Model have to be designed and have to be changed to sustain
compatibility to these factors.

For example, even though environmental circumstances dose not change rapidly, because of thelack of data, Asset management System and Logic Models have to be maintained with increasing
environmental measurement and inspection information.
Technical circumstances like technological evolution of construction, rehabilitation, inspection, andtechnological standard could change countermeasures so that Logic Model, portfolio of thecountermeasures alternatives such as physical rehabilitation, physical renewal, new construction,
inspection system or combination of these them, or outcomes themselves have to be revised to fulfill
strategic target which also changes with citizens’ request.
These amendments have to be executed at three stages as explained for Infrastructure development
plan, which itself is the NPM procedure to be executed.

７．Conclusion and expected future activity
Conceptual structure of NPM system associated with Logic Model and engineering measurement
and evaluation is introduced, which can be applied for development plan, service plan, or asset
management system for infrastructure, yet there are not enough activities done along these NPM
procedure.
Some NPM activities is undergoing such as asset management for infrastructures, administrativeplanning for health care of old people, and other administrative activities by the author, but more
activities is expected to be executed especially by engineers. And it will take some time to confirm theresults of these activities.
Reference“Road Asset Management and New Public Management” invited lecture at 25th Shino-Japan
Technological Workshop, 2005/6/15 Taipei city, TAIWAN)“Logic Model Development Guide” published by W.K. Kellogg Foundation in 1999
“Total Asset Management” New South Wales, Australia“Introduction of New Public Management system into a local government” GOSO Takashi, UEMOTO
Kotomi, NASU Seigo, International Conference on Measurement and Management of Infrastructure,
Oct.29-31, 2004）