When state government is reformed using the method I have proposed: implementing Lean Teams followed by the elimination of several levels of bureaucratic management ending with a two tier Steering and Functional Management organization, you are left with a problem. What to do with the redundant government employees?

One must recall why government work was privatized in the first place. It is common knowledge that the reason is that government employees were thought to be unmotivated and could not do the work as efficiently as a private company. With the reforms I have recommended you will find that it is not government employees that are inefficient but the bureaucratic structure of government. Government Employees can be just as efficient and effective as private employees. But using the above reforms government employees will be even more efficient than private employees.

Therefore with the above reforms all privatized contracts should be considered for return to government personnel using the reorganization process which I have recommended. This will save the state millions and the efficiencies attained cannot be matched by private companies especially when you remove the need to make a profit.

Note that in Article 13. “How Efficient Government Reform Can Save More Tax Dollars Than Privatization” I stated that you could save more tax dollars by government reforming itself than by privatization. Profits gained by the private company are lost and are not available to the state treasury. Another problem is that a private company may not implement the kind of reforms that bring continuous improvement and increased productivity that you want. Still another consideration is would the employees be better off under privatization. Would there be better job satisfaction health care and retirement benefits. An organization may be able to retain much of these benefits by self-reform. Certainly Privatization can work but it costs more to the state than if the state would make the reforms to itself. A private company’s profits may also come from reduced employee benefits.