Probing the Strategic Intricacies of Public–Private Partnership: The Patent as a Comparative Reference

Discussion about the privatization of public services often reflects the analyst's policy preferences regarding corporate involvement in government affairs. Advocates of public-private partnerships generally predict near-term performance efficiencies for government in the form of cost reduction and enhanced service quality (Goldsmith 1997; Osborne and Gaebler 1992; Savas 1987). Alternatively, critics associate government privatization with an erosion of traditional public-service values, such as commitments to equity, due process, ethics, and accountability in government (Fainstein and Fainstein 1995; Frederickson 1997; Robertson and Acar 1999). Both perspectives may inform the initial privatization decision, but neither offers public managers much guidance after policy makers opt for such ventures, however advisedly. In explicating the nature of twenty-first century governance, Charles Goodsell asserts (1999, 4) that public administrators will be called upon to create (but not necessarily to constitute) capacity to act on "bewildering, unpredictable, and hydra-headed matters." When applied to public-private partnerships, Goodsell's characterization more logically typifies gaming situations than monitoring and control processes. Indeed, partnership arrangements--long-term ventures that involve numerous financing and responsibility-sharing agreements--can be aptly discussed in terms of (1) choices that arise in the contexts of (2) interdependence, (3) imperfect information, and (4) chance--the four elements of a game (McDonald 1950, 62). Characterizing partnerships as games and discerning strategies therein assume certain risks of misinterpretation. First, some may regard references to partnership games as unduly cavalier treatment of such a contentious issue. Second, efforts to elaborate on private-vendor mind-sets and motivations (as gleaned from privatization conversation discussed in subsequent sections) can be misconstrued as advocating privatization and outsourcing. The purpose of this article is not to debate the pros and cons of privatization, but to assist public managers in recognizing the strategic nuances of complex and sophisticated privatization games. So far as governance will continue to entail such public-private interfaces (for better or worse), effective public partners will rely more on mastery of strategy for ongoing negotiation than on conventional processes to channel these relationships. This study draws on first-hand observation of industry conversation,(1) which speaks to complexity within and among the many privatization concerns (such as risk allocation, price considerations, performance responsibilities, and dispute resolution). It is this complexity that shapes the game and creates strategic entrepreneurial opportunity. In this article, metaphorical analysis serves as a tool to identify the strategic nuances of large-scale privatization partnerships (often involving transfer of capital assets in areas such as water management and corrections). Organization theorist Gareth Morgan (1980, 610) recommends metaphorical reasoning as "a creative form which produces its effect through the crossing of images." Such comparison can reveal similarities and differences that lend clarity to the complicated components of privatization. This study coaxes out a strategic understanding of privatization through a metaphorical comparison with U.S. patent policy, especially as it pertains to high-tech industries. Ostensibly, the payoffs from the patent-partnership metaphor will accrue (not from the technological nature of either, but instead) from its focus on two similarities: (1) Both patents and partnerships represent governmental endowments that trigger entrepreneurial activity, and in so doing, (2) each defines strategy amid particularly complex enterprises. Further, attention here to industrial strategies pertaining to patent matters provides a basis for articulating specific questions about public-private partnership "games" and strategies therein. …