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December 1, 1997
WORLD WASTES STAFF
As a manager of a large municipal solid waste operation, I used to look on my counterparts in the private sector with a mixture of awe and self-righteousness.
The awe came from the admiration of those who struck out on their own to sink or swim in the sea of competition to earn their daily bread.
The self-righteousness came from feeling my activities were motivated more by what was best for the community I served than by the bottom line. That allowed me to feel my motives were purer, my actions more altruistic.
As my knowledge of the private sector increased, however, I realized how hypocritical I had been. Both public and private solid waste professionals are motivated by the same factors: They want to make a living by means of one of the most challenging occupations.
Good solid waste professionals - both public and private - are going to use their abilities to do the best job.
Having hired many former private employees for the city of Los Angeles' operation, I have a sense of the different requirements of both operational types on their employees.
For example, private operators generally are required to work longer hours, cover larger areas and have fewer benefits. Their salaries could be greater, but in most cases, they were less. In fact, most expressed delight with the city's easier working conditions.
Los Angeles had a stricter entry requirement than some private haulers. We usually found the former private workers were excellent employees. While it is more difficult to remove poor workers from their public sector jobs due to the civil service code, private firms are able to weed out the shirkers with greater efficiency.
In 1992, I became involved in operating two private businesses. It opened my eyes to the difference in philosophy regarding budgeting, costing and profit-making.
In public service, I was involved in budget making on a grand scale. It is similar, although in a greatly reduced scale in our small, private businesses.
The major difference is the concept of profit. It was shocking to realize that while I had no problem defining cost, including salary, I had no idea what profit was. If I received back the cost of my goods, and the compensation I believed I was entitled to, then what was profit?
It gradually has dawned on me that those of us who have worked exclusively in the public sector are lacking in some of the driving forces of our private counterparts.
It is only recently that some municipal operations have had to compete in the same arena, with the same rules, as the private sector. (See "How to Keep the Keys to the City" on page 36). Profit should be the edge that public sector operations have over the private sector.
If a public operation is run as efficiently and if the service is as good as a private operation, then it should operate at a lower cost or provide more service because those factors would take the place occupied by profit in the private operation.
The fact that some public operations are not able to initially compete for their own operation should be a wakeup call to all public sector professionals.
Another problem is that the private sector is not obligated to give a community more than the community has the good sense to pay for.
If a community does not have the expertise or foresight to contract for services that are needed later, then it only can re-negotiate the contract.
If a community does not have a quality solid waste operation now, how will it know what it is lacking, or how to recognize a quality proposal when one is presented?
I have often thought of what it must take to make a living as a private hauler. First, you must have a great deal of confidence. Then, you have to work for someone to learn the ropes, find the capital to begin your business, compete with not only the established competition, but all the others like yourself who are scrambling for the foothold that will allow you to climb into profitability.
The equipment must be maintained and repaired. Employees must be hired, fired, supervised and trained. Numerous regulations must be understood and met in a timely fashion. Bookkeeping and accounting tasks must be calculated.
Like any small business, it is a day and night job. Vacations, profit and a life are off in the future. There are no civil service protections, no automatic medical insurance, dental plan or retirement fund.
It is like swimming in a deep pool of sharks without a life preserver. My hat is off to you, brothers!
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