Bureaucrats vs. Sharks: Managing sector differences in public-private joint ventures

This article delivers preliminary responses to the research questions: How do sector differences generate conflict in public-private joint ventures? And how do public-private joint venture managers deal with these conflicts? The increase in public-private cooperation in democracies worldwide (OECD 2005), the difficulty of cooperating across boundaries (Huxham & Vangen 2000), the importance of management in determining success in inter-organizational cooperation (Dyer et al. 2007), and the insufficient attention scholars have given to this subject (Provan, Fish, and Sydow 2007), all underscore the relevance of our research questions. Neither that difficulty of cross-sector cooperation is due to diversity (Huxham and Beech 2003) nor that public and private sectors differ (Rainey and Bozeman 2000) are novel. Yet, to our knowledge, few studies have addressed in depth the precise effects of the public-private differences on cross-sector cooperation and their subsequent management. We focus precisely on how participants of joint ventures manage the challenges caused by differences between sectors. To explore our research questions we use a rich, in-depth qualitative study because of the complex, dynamic nature of public-private cooperation (Agranoff & Radin 1991; Marshall & Rossman 1995). The research process consisted of an interview study (Rubin & Rubin 2005), using one case: an economic development private company -PTB- set up by city councils, a savings bank, and a small group of leading local entrepreneurs in Barcelona, Spain. We coded the transcribed interviews, which ultimately lead to our narrated findings. In answering our first question, we find that the differences between sectors that cause conflict in the joint venture are: economic vs. political rationales; faster vs. slower paces and short-term vs. long-term timeframes; the uniformity of business organizations vs. the multidimensionality of public organizations; and the negative stereotyping of each other. In successfully overcoming these differences, we find that joint venture managers execute three practices: communicating with stakeholders, involving the social context, and facilitating interaction. We discuss these findings with respect to the existing literature on public-private differences (Nutt 2006; Rainey & Bozeman 2000) and collaborative management (Agranoff 2007; Huxham 2003). And, following Bardach¿s (2004) extrapolation strategy, we also uncover the two social mechanisms, which drive the three identified practices: building trust, shared meaning-making, attending the socio-political context, and bridging diversity. We conclude by specifying the case's context and discussing the findings' limitations and extrapolation potential.