International Public Management Journal, 10 1: 59-l 06 Copyright 0 1998 by JAI Press Inc. ISSN: 1096-7494 All rightsof reproduction in any form reserved. G.B. Reschenthaler PUBLIC MANAGEMENT University of Alberta AND THE LEARNING Fred Thompson Willamette University ORGANIZATION zyxwvutsrqponmlkjihgfedc ABSTRACT: This paper examines institutional arrangements that would allow public sector organizations to learn more effectively. According to management strategists and organizational theorists any organization that can learn is inherently equipped to develop a sustain- able competitive advantage. The NPM could help build learning organizations that operate more efficiently and effectively and that also better serve citizens and the public interest. INTRODUCTION The period 1975 to 1995 has witnessed a redefinition of the relative roles of gov- ernment, business, and the market in most countries world-wide, with the role of government in universal retreat. These changes are more than ones of fine tuning, modest realignment, or reaction to public debt pressures from financial markets; they involve, on balance, a substantially reduced role of government as a planning and regulatory agent in the economy and the adoption of new approaches to gov- ernance. In this paper we examine some of the forces which are driving these changes. We use the learning organization paradigm developed by Peter Senge (1990) as a framework to explain many of the obstacles to change in the public sec- tor which prevented earlier-and more moderate-reform and laid the foundation for more radical change. We suggest that the New Public Management is a response to these forces of change and represents an effort to convert government and public sector organizations into more effective learning organizations. Direct all correspondence to: G.B. Rechenthaler, University of Alberta, Faculty of Business, Edmonton, Alberta T6G 2R6, Canada; e-mail: Gil.Resch@ualberta.ca.