Public value concerns us all

The welfare of the individual also depends on public value. As social beings, humans are dependent on an environment in which they can develop as individuals and where they experience acknowledgement and support. In a functioning society, public value is the bond which holds the community together, the guideline for solving conflicts, and a resource for the individual. Consequently, public value always embodies a concept of what should be common to all and how the character of a society distinguishes itself.

Public value lies in the eye of the beholder

Public value focuses on the question how citizens perceive their social environment. Public value is created as soon as an individual experiences the social collective bond positively. This is based on a value-philosophical consideration that value is always the result of positive assessments of a valuation object by an evaluating subject. In the case of public value, the individual evaluates the community. In a modern society, a variety of organizations influence community experience significantly. A soccer club can, for example, contribute to social cohesion in a city, and a bank to a country’s economic development, by fulfilling the core business tasks.

All these public value contributions have one thing in common: Public value is only created when it touches the minds and hearts of people. This also means that facts are not sufficient. Public value only exists if an organization’s actions are translated into positive individual perception. Public value can therefore not be determined a priori, but should rather be designated as a spontaneous order. Which values really count, also depends on the respective societal and cultural background in which public value is embedded.

Public value is measured in terms of basic human needs

How do individuals determine whether an organization contributes to public value? Community experiences and evaluations are psychological processes in which cognitive-rational, as well as subconscious-emotional, factors play a role. With each evaluation, we rely on a structure of basic needs which, to a certain extent, serves as a benchmark. If these needs are fulfilled, our evaluation is positive; if not, our evaluation is negative.

In a comparative study, the American psychologist Seymour Epstein identified four basic human needs, on which the four public value dimensions are based (see Meynhardt, 2009):

Task fulfillment – basic need for orientation and control

As individuals, we strive to understand our environment and predict the cause-effect relationship. Associated with this is a need to orientate ourselves in our environment, to understand it in its context, and to maintain and/or broaden our scope for maneuvering. In order to evaluate an action from this perspective, it is necessary to assess its usefulness to achieve a goal. The object of the evaluation is a relationship between ends and means. Hence, an instrumental-utilitarian value aspect is pivotal. (This is also the conceptual link of an economic value concept which expresses value as financial-economic figures. Value measured in monetary units is, in the narrow sense, no value in respect of individual basic human needs, unless it is specifically identified as an instrumental-utilitarian value.) The instrumental-utilitarian value dimension generally draws attention to the immediate need. An organization can contribute to this aspect of public value if, in the eye of the beholder, it is successful in its core business. The organization fulfils its task by creating a noticeable benefit with its products and services.

Social cohesion – basic needs for positive relationships

Individuals strive for acknowledgement and cohesion in a social collective. They search for a sense of belonging and group identity, but simultaneously they also search for a balanced relationship between closeness and distance. The need for positive inter-human connections aims at the human “social nature.” The need for acknowledgment in social relationships is higher than the individual’s need to be acknowledged as a moral being. The focus is therefore on group acceptance and the associated experiences. From this perspective, the dominant evaluation point of view is a socio-political one, which turns values, like solidarity, cooperation, power, sense of status, and group identity, into topics of discussion. Organizations contribute to these socio-political value dimensions when, in the eye of the beholder, their actions and conduct advance social cohesion.

Quality of life – basic need for pleasure and avoidance of displeasure

We strive towards positive emotional experiences and the avoidance of pain. Initially, the need broadly aims at the avoidance of pain and at gaining positive experiences. This evolutionary, deeply anchored need is directed at survival and at a secure livelihood as an organism. Through cultural transformation, this need develops into a need for pleasure and even further into a need for aesthetic experience. Thereby, this fundamental evaluation viewpoint aims at hedonistic-aesthetic values, for example, security, beauty, fun, joy, as well as general wellbeing and experiences of happiness, which are expressed in various ways, also on the collective level. In the eye of the beholder, organizations contribute to this value dimension by contributing to the quality of life and providing us with positive experiences as individuals.

Morality – basic need for self-worth preservation and growth

Individuals strive towards a positive self-image and a strong feeling of self-worth. As individuals, they want to be appreciated and fairly treated. This need focuses on the perception of a person and, thus, also of the individual. This is referred to as moral-ethical evaluation, because it broaches the issue of the evaluation aspect within the social environment, to what extent an action or decision leads to more equality or inequality; or whether something applies to all humans (in a self-defined context) or not. An action is always morally valuable (“decent”) if the individual sense of justice is not violated, confirmed, or even strengthened. If, however, a person experiences a discrepancy about what she/he considers appropriate, just, and fair, the emotional-motivational anchored feeling will be destroyed and the discrepancy will be classified as “immoral”. In any case, this evaluation is always in relation to the self-concept as a person and, thus, one’s self-image and self-esteem. On a societal-collective level, established values, like human rights, human dignity, and the autonomy of the individual, are essentially moral-ethic values. They endeavor to define the characteristics of a person as a human being if his or her individuality and self-understanding are addressed. In the eye of the beholder, an organization behaves morally valuable and, thus, decent, if this organization enables an individual’s positive self-worth, thereby creating value focused on the individual. This is the foundation of the morality dimension.

Conclusions from psychological research indicate that the four need dimensions cannot be placed in a hierarchy, but that they rank equally. Thus, all four dimensions contribute equally to the public value score. But since public value ultimately lies in the eye of the beholder, we allow the user of this online portal to apportion more weight to certain single public value dimensions. By adjusting the slide controls, the users can determine the criteria according to which the ranking order should be prioritized to express their individual preferences.

The four public value dimensions

Public value as societal value creation

If public value is understood in this sense, organizations play a huge role in creating public value. Thereby, in the sense of societal value creation, a public value contribution becomes an important perspective and output variable for management. With reference to the “public value” concept (see Wikipedia), this discussion plays an important part in administrative science and management research (see Meynhardt and Gomez, 2013). According to Meynhardt, the above discussed view of public value as a concept anchored in perception and basic human needs that organizations can influence, is derived from the St.Gallen public value approach (see Meynhardt, 2008), which Meynhardt’s definition of public value creation shows:

Public value is created or destroyed only when individual experience and behavior of persons and groups is influenced in such a way that it has either a stabilizing or a destabilizing effect on the evaluation of social cohesion, communal life and the self-determination of an individual within his or her social environment. Public value is thus created as a result of evaluation processes with a collective and, in this sense, social character, and is not limited to the individual.

Meynhardt, T. (2008). Public Value - oder: was heißt Wertschöpfung zum Gemeinwohl?. dms - der moderne staat, 2, 457-468.