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RED TAPE PERCEPTION IN PALEMBANG ONE STOP SHOP (OSS)

TILBURG LAW SCHOOL


MASTER`S THESIS IN MSc PUBLIC GOVERNANCE 2017/2018

RUDIANTORO SYARKOWI DAUD


ANR 2008195 / SNR 944406

SUPERVISOR: DR. ALEX R. INGRAMS


SECOND ASSESSOR: DR. WESLEY KAUFMANN
ABSTRACT

One innovation in public service is One Stop Service (OSS) which has objective to reduce the
red tape in public services. OSS also comes with their rules and regulation that can potentially
support red tape. Policymakers and managers often enact rules and procedures to improve
performance. Unfortunately, the extent to which those rules are useful for achieving an
organisation’s goal is sometimes questioned. Different stakeholders may have different
appraisal about the red tape. This research is trying to find the perception of red tape saw both
by citizens as service users and OSS internal employees as service providers in Palembang
City, Indonesia. Naturally, when people talk about OSS, they imagine comfortable and
convenient public service centres. But this notion may contradict in reality, as red tape is
inevitable especially for governments.
The theory on red tape and literature related to the OSS is used for this research particularly
that help to measure the extent of burdensome, unnecessary, infectivity of rules and procedures
applying in the organisation. The data mainly collected through questionnaires and also
complemented with the interview with OSS manager(s) and OSS customer. The finding reveals
the level of red tape within OSS in Palembang City and gives a better understanding about red
tape in OSS. Moreover, this result provides benefits for the improvement of public delivery
services, particularly in OSS.
The result shows there is a difference in the extent of red tape perceived between internal and
external stakeholders. The external tends to be higher than the internal. The cause of high red
tape from customers` perspective mainly comes from the delay, corruptive behaviour,
transparency (in cost and time). Those factors are assumed to be connected to each other. The
result also shows that two other assumed factors namely rule`s objective understanding and
employee’s competence seem to have less influence on red tape perception in Palembang OSS.
This research is expected to help understand the red tape phenomena in the given public service
centre. Besides that, the number of studies that reveal red tape perception among different
stakeholders for a particular set of rules may be insufficient too. Thus, this research tries to
contribute to existing knowledge about perceived red tape by different stakeholders in low-red-
tape-intended public organizations.

Keywords: red tape, One Stop Shop (OSS), employee`s perception, customer perception.

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ACKNOWLEDGEMENTS

By time,
Indeed, mankind is in loss,
Except for those who have believed and done righteous deeds and advised each other to truth
and advised each other to patience.
(Al-`Asr: 1-3)

I would first like to thank my thesis Supervisor, Dr. Alex Ingrams of the Tilburg Law School /
Tilburg Institute of Government at Tilburg University for the valuable feedback and advises.
I would also like to thank the all OSS employees especially to the Head of OSS for his help to
encourage his employees to take the survey and for all people in Palembang who were available
for the survey.
I would also like to acknowledge Dr. Wesley Kaufmann of the Tilburg Law School / Tilburg
Institute of Government at Tilburg University as the second reader of this thesis.
Finally, I must express my very profound gratitude to my parents, my wife (Nova Isriani, SE)
and my children (Fardhan and Firdhi) for providing me with unfailing support and continuous
encouragement throughout my years of study and through the process of researching and
writing this thesis. This accomplishment would not have been possible without them. Thank
you.

Rudiantoro S. Daud

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TABLE OF CONTENTS

ABSTRACT............................................................................................................................................ 2
ACKNOWLEDGEMENTS .................................................................................................................... 3
TABLE OF CONTENTS ........................................................................................................................ 4
TABLES AND FIGURES ...................................................................................................................... 6
INTRODUCTION .................................................................................................................................. 7
1.1. Background ............................................................................................................................. 7
1.2. Problem question and Research Objectives ............................................................................ 9
a. Research question ................................................................................................................... 9
b. Research objectives/purposes ............................................................................................... 11
1.3. The Research Benefits .......................................................................................................... 11
a. For Academic ............................................................................................................................ 12
b. For Society ................................................................................................................................ 12
CHAPTER II......................................................................................................................................... 13
THEORETICAL FRAMEWORK ........................................................................................................ 13
2.1. Red Tape .................................................................................................................................... 13
a. Definition .................................................................................................................................. 13
b. Red tape as Perception: ............................................................................................................. 16
2.2. One Stop Shop ........................................................................................................................... 18
a. The ideal purpose of one stop shop ........................................................................................... 19
b. OSS in Palembang City............................................................................................................. 21
2.3. Red Tape Perception in OSS ...................................................................................................... 24
a. Public perception of red tape in OSS ........................................................................................ 24
b. Internal perception of red tape in OSS ...................................................................................... 26
c. The factors that influence red tape perception .......................................................................... 28
CHAPTER III ....................................................................................................................................... 32
RESEARCH METHODOLOGY .......................................................................................................... 32
3.1. Method of the research............................................................................................................... 32
3.2. Data Collection .......................................................................................................................... 33
3.3. Population and Sampling ........................................................................................................... 33
3.4. Data Analysis Methods ......................................................................................................... 35
3.5. How to measure red tape............................................................................................................ 35

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CHAPTER IV ....................................................................................................................................... 37
RESULT ............................................................................................................................................... 37
4.2. Red tape perception in Palembang OSS .................................................................................... 37
a. The external perception of red tape ........................................................................................... 37
b. The internal perception of red tape ........................................................................................... 40
c. The cause of high (or low) red tape perception ......................................................................... 46
CHAPTER V ........................................................................................................................................ 54
CLOSING ............................................................................................................................................. 54
5.1. Conclusion ................................................................................................................................. 54
5.2. Recommendation for improvement ........................................................................................... 55
CHAPTER VI ....................................................................................................................................... 57
RESEARCH LIMITATION ................................................................................................................. 57
BIBLIOGRAPHY ................................................................................................................................. 58
APPENDIX ........................................................................................................................................... 62

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TABLES AND FIGURES

Figure 1. The organization structure of Palembang OSS ............................................................... 23


Table2. The kind of license and permit services in Palembang OSS ........................................... 23
Table 3. Population and Sample of Palembang OSS employees.................................................. 34
Table 4. Sample of OSS customer ................................................................................................ 35
Table 5. The OSS customers’ perception about rule`s burden .................................................... 37
Figure 6. The number of different government offices that Palembang OSS consumers have
to visit to complete the requirements ........................................................................... 38
Table7. The OSS customers’ perception about rule`s necessity ................................................. 38
Figure 8. The respondent’s response about the rules complexity in Palembang OSS .................. 39
Table 9. The OSS customers’ perception about rule`s effectiveness ........................................... 39
Table 10. The OSS employees’ perception about rule`s burden.................................................... 40
Table 11. The OSS employees’ perception about rule`s necessity ................................................ 41
Table 12. The OSS employees’ perception about rule`s effectiveness .......................................... 41
Figure 13. Burdensome perception comparison between OSS customers and employees ........... 42
Figure 14. Comparison necessity perception between OSS customers and employees ................ 42
Figure 15. Comparison necessity effectiveness between OSS customers and employees ............. 43
Table 16. The distribution of burdensome perception among different position in Palembang
OSS.................................................................................................................................. 44
Table 17. The distribution of necessity perception among different position in Palembang OSS 44
Table 18. The distribution of effectiveness perception among different position in Palembang
OSS.................................................................................................................................. 46
Figure 19. The Palembang OSS customer`s perception about the excessiveness and constraints
of rule and procedure (red tape) in government sector ................................................ 47
Figure 20. The customer`s perception about the excessiveness and constraints of rule and
procedure (red tape) in Palembang OSS ........................................................................ 47
Table 21. The OSS customers’ perception about delay in OSS (time needed to get permit
done) .............................................................................................................................. 48
Table 22. The OSS customers’ perception about transparency in OSS .......................................... 48
Table 23. The OSS customers’ understanding about rule`s objectivity ......................................... 49
Figure 24. The respondent’s response to the question: Do the rules, procedures, and
requirements apply in OSS make you feel it would be helpful to give grease money
to OSS employees? ......................................................................................................... 50
Figure 25. The respondent’s response to the question: have you ever given bribe/money to
smooth your permit application in OSS?........................................................................ 51
Figure 26. The respondent’s response to the question: does your application process become
smoother after pay grease money? ............................................................................... 51
Figure and Table 27. The customers’ assessment about the OSS employees` skill and
competence .................................................................................................................... 52

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CHAPTER I

INTRODUCTION

1.1.Background
Implementation of the One Stop Integrated Services (OSS) Shop in Indonesia provides a
perfect example of the changing paradigm across the globe where governments are
transitioning from rulers to services providers. Changes in government orientation to public
services bring a positive impact amidst the various complaints that often occur in the
community. It is understandable that the negative impression of bureaucracy is so inherent in
a long and tedious process that is even scary or irritating to some societies (Rainey: 2003;
Wilson 1989 in Brewer et al.: 2009). Brewer said that red tape has probably become the most
pervasive and damaging of all bureaucratic maladies (Brewer et al.: 2009). He argues that red
tape can cause public organizations to be more arthritic and self-serving, less able to achieve
their core goals, less responsive to political authorities and service users (Brewer et al.: 2009).
Communities will perceive them as long-winded, having long processes and vague in time and
cost (see Kaufman: 1977 and Bozeman: 1993). This also applies to the private sector which
wants get licensing. The number of conditions that would be needed to be met in various
agencies would be a burden of its own inhibiting investment or new business (see Login report
on OSS). As suggested by Bozeman et.al (1992: p.290) the term red tape emerged from the
image of “a slow bureaucracy inundated with minute rules and regulations”.
Issues relating to various barriers to licensing such as long and complicated processes, non-
transparent in procedures can lead to an attempt to speed up the process or be treated more
favorably by officials by providing tribute. Red tape and corruption in public organizations do
have a strong correlation (Fazekas: 2017, Walker and Brewer: 2008). Red tape and corruption
also seem to be linked similarly to the "egg or chicken?" question. However, the which comes
first debate does not seem to be very important as both are undesirable for society. Guriev
(2003: pp 489) claimed that corruption and red tape cannot be treated independently. Tedious
and long-standing procedures may prompt officers to ask for illegal payments to speed up the
process. In other hand, a corruptive mentality of public apparatus makes them publish lengthy
and difficult procedures to facilitate the receiving of money (for personal gain) (see Guriev:
2003). Rohwer (2009) argues that “payments or returns are needed or demanded to make
things more swiftly, smoothly or more favourably through the state or government
bureaucracies”.
One of the efforts to facilitate service improvement for the community is through the
establishment of one-stop integrated services, a practice widespread throughout the world. This
effort also applies to Indonesia which is still struggling to improve the quality of services to
communities. To improve licensing and non-licensing services throughout Indonesia, the
Government of Indonesia has issued a policy for the establishment of an integrated service
center. The latest Presidential Regulation No.97 of 2014 states that the implementation of one-
stop integrated services is intended to bring closer and improve services for the community,
and to shorten the service process to realize a service that is fast, easy, cheap, transparent,
certain and affordable. In addition, in the presidential decree, it is stated that integrated service
is carried out by unifying the process of managing services both licensing and non-licensing.
With the issuance of the regulation, every province, municipality, and the city must establish a
one-stop integrated service office.

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The existence of OSS does not necessarily remove the various complaints that often occur. As
stated in the report of Local Governance Initiative and Network (LOGIN Asia, p.16): “this may
not be so in reality as OSS can come with their own set of officials and delays in the provision
of services”. Not every established OSS within local governments are successes and achieve
their goals to improve public service quality and decrease corruption (Wahid: 2013). In practice,
it is believed there are still obstacles to its implementation. The President of Indonesia Joko
Widodo (Kompas.com: 2015) expressed dissatisfaction with the performance Integrated one-
door service which according to his judgement is still slow. The same thing was also said by
the newly elected Vice Governor of Jakarta, Sandiaga Uno (Kompas.com: 2017): "one-stop
service is a very good idea, and now it has been being running, but many complaints from the
public because the process is long, it is true one door, but so long". One essential problem has
emerged that being OSS is still considered to have a burden in their process. Moving all
services from different offices to one door/one roof does not simply solve the problems.
Internally, to provide services to the public, officers must still comply with the rules and
procedures already formally set up to provide certainty and accountability. As Kaufman noted
in his well-known book (1977, p.4): “one person`s red tape may be another`s treasure
safeguard”. OSS officers are tied up by preconditioned rules of service that perhaps reduces
flexibility in the face of a specific problem. If the rules are made in accordance with or in line
with public expectation, of course, this will not be a problem. Problems will arise when the
rules display an image of the OSS to that contrary to what is expected - which is to simplify
and shorten the service.
The motives of the issuance of such rules and procedures perceived as red tape may be traced
to the establishment process of OSS itself. Rizal (2008) distinguishes two models of public
service policy with each inherent advantages and drawbacks. The first model is known as
‘sharing model’, policy through which the various services are located on different authorised
agencies. The citizens must actively attend different public offices to complete the
requirements or given services they want to. This model tends to be closed and lacks
transparency in its nature because people do not know about the services` operational standard,
time, and cost. Thus, this condition is conducive to corruption and other illicit practices.
However, using this model, the service providers do not need to coordinate with others to
publish permits or licenses if all requirements are met. Excellent services can be achieved if
the public officers have strong integrity and public services orientation awareness. The second
model is ‘integrated services`, policy through which various service provision authorities are
taken from previously separate agencies and are placed in one unit service center. The new
integrated unit has jurisdiction that ranges from administrative works, substantive checks, to
permit issuances. Hence, this former model is beneficial to the public because it enables cost
effectiveness, faster and a simpler process aside from providing them with information.
Unfortunately, the agencies initially own authorities are often against the later policy
implementation. The fear of loss in (either/both officially or illegally) budget and gains vested
by the specialization of expertise argument hinders the goals of OSS establishment. These
agencies still insist on playing a role in the process of permits, licenses and services conducted
in OSS. This phenomenon is difficult to avoid especially during the transition from the first to
the second model. Accordingly, their involvement is accommodated by additional step(s), or
pre-requirement(s) needed to complete specific permits and licenses. For example, even though
it is often declared that people only need to visit one place (OSS), they sometimes are required
to obtain recommendation letters from other public agencies to comply with all the
requirements before their enrolment get processed by OSS. The result is that the community
must continue to go to different places. Another practice is people seem only come to one place
to receive the specific service they require. Yet, OSS passes the documents to other agencies

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to perform several procedures such as inspections, field checking, and so forth undertaken by
technical officers from those other agencies. Without any justification, these procedures seem
to be cause delay and vexing citizens. That is why the policymakers must prudentially enact
the set of rules, regulation, and procedures and apply within OSS. They must carefully consider
the necessity, effectiveness, burden of regulation rules and procedures against the OSS`
objectives. Otherwise, the public will argue that there is no improvement in public services and
still perceive a large amount of red tape even though the OSS is already established.
Although people feel uncomfortable and fearful when fulfilling government requirements,
officials may see them in a contrasting light as it is often said by scholars: “one`s red tape is a
safe guard for another” (Kaufman: 1977, p.4) Internal governments are prone to perceive
established rules and procedures as a safeguard and a form of accountability. It seems their
attitude also fits with the blame avoid concept from Hood (2007). This perspective discrepancy
on red tape occurs because red tape has subjective measurements. An intriguing question raises
about how the difference of red tape perception in OSS between the citizen as service user and
OSS employee. By comparing the red tape perception of both sides, the result will be beneficial
to assess the accomplishment of OSS`s goal itself.
Therefore, it is essential to measure red tape perception within OSS because it is related to the
performance of OSS and achievement of its primary goal which is to shorten the process of
services. According to Jacobsen and Jakobsen (2018, p.25) “organizational performance
related to a set of standards about its intended goals and achievements”. Bozeman and Scot
(1996 in Jacobsen and Jakobsen 2018, p.25) argue that Policy makers and managers often enact
rules, regulation, and procedures to improve performance. Unfortunately, the extent to which
those rules, regulations, procedures are effective for achieving an organization’s goal is
sometimes questioned (Bozeman and Feeny in Jacobsen and Jakobsen 2018, p.25). Based on
this, it is necessary to research the red tape phenomena within OSS to find existing problems
and make improvements in the future. As Login Asia said: “OSS must ensure that the primary
objective of establishing OSS is to bring government closer to the people, and not to increase
the distance between them”. This notion is supported by Brewer that “maintaining high levels
of governmental performance is obviously very important at large” (Brewer et al.: 2009). Thus,
OSS is expected to cut red tape as it is assumed as something unexpected by citizens (Wimmer:
2002).

1.2.Problem question and Research Objectives


a. Research question
Red tape has become a popular topic with scholars and practitioners’ discussions for the last
few decades. There are numerous researches and studies dedicated to red tape with most being
based firmly on the theory by Bozeman and Kaufman. It is an intriguing topic because of the
relation to quality and society`s satisfaction with service delivery from government agencies.
Probably, most citizens have unfavorable connotations when they are asked about red tape. The
experience with lengthy chain procedures, time-consuming, unpleasant expectation they have
faced in the past would seemingly shape their thinking about red tape.
Red tape also apparently has a connectedness with the quality of service people expect
beforehand. People would feel unsatisfied if the services they received were different from
what they thought they would receive. The gap between what they expect and what they receive
determines the level of satisfaction. A wider gap will more likely create a higher level of
dissatisfaction, and vice versa. Many theories of public administration use service user`s
satisfaction to measure the quality of service delivery. The indicators about quality are based

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on what is usually expected from service provisions such as ease of access and procedure,
transparency, efficiency, timely manner, certainty, the cost.
The expectation about the quality of service delivery is even greater in the public domain. It is
unsurprising due to the vital role government plays in the public interest for instance: livelihood
goods and services provisions, health, education, public documentation and so forth. The
expectation is also likely to be encouraged by the thinking that the provisions of basic goods
and services are a government duty. It is an obligation for authorities and a right for every
citizen to be treated decently, equally and fair. Therefore, based on these arguments, the
government agency should be obligated to provide prime services to its citizens.
Nevertheless, the hope about the excellent services expected from the public agency is still a
problem as Bozeman has shown in his study about why government institutions have more red
tape than private (Bozeman: 1993). One problem still shadowing the public regarding public
service is red tape. Red tape is sometimes attributed by citizens to lengthy and time consuming
procedures and requirements to receive a specific service. Suspicion that these long process
and bulk of precondition in public sectors are deliberately maintained to allow opportunities
for officials to gain private benefits from their positions such as bribery, petty corruption,
extortion, and other illicit practices, also emerges. Kaufman stated that government officials
most likely face abundant temptation such as selling their official discretion and information
and opportunities to extort payments (Kaufman: 1977). The interdependency between red tape
and corruption is durable as argue by Sergei Guriev (2003) in his study covering red tape and
corruption. He asserted that corruption and red tape could not be treated independently and
they may stem from one another (Sergei Guriev: 2003).
On the other hand, perhaps practically for the internal agency, the rules and procedures they
make or they impose have the specific rational objectives needed by the organization itself. For
example, the reason behind specific rules and procedures is likely to be that they must meet a
certain level of accountability and minimize the risk if something goes wrong in future.
Kaufman (2015) gives an example of this by said: “the controls on accounting and financial
management, therefore, abound, as do the statutes and regulations on personnel
administration...”
Researches and literature that correlates red tape and performance are abundant but few discuss
the red tape phenomena in OSS, specifically focused on the influence of red tape perception in
OSS. For instance, Jacobsen and Jakobsen (2018) reveal employees` perception of
organizational red tape can reduce their motivation and constrain their autonomy, eventually
this perception is detrimental to organization performance. Pandey at. al. (2007) discusses the
negative effect of red tape on organizational effectiveness and Brewer and Walker (2009)
consider the impact of red tape on governmental performance. However, those studies do not
show how red tape can exist in such organization who in fact intend to cut it, in this case OSS.
Or, to put it another way, red tape perception is seldom used to review OSS performance by
practitioners. Intuitively, when people talk about OSS, they imagine easy and convenient public
service centers. But this notion may contradict some prominent scholars, as red tape is
inevitable especially for governments. This research is expected to help understand the red tape
phenomena in the given public service center. In additional, the number of researches that
reveal red tape perception among different stakeholders for a particular set of rules may be
insufficient too. Thus, this research tries to contribute to existing knowledge about perceived
red tape by different stakeholders in low-red-tape-intended public organizations.
As intended by its goals, OSS is expected to cut red tape. When people think about OSS, the
common assumption is that it has provided easy procedures for citizens as a remedy for
bureaucratic malady. But this assumption stems comes from internal assessment. Claims by

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the government tend argue that they already have a system that reduces the complicated rules
(http://jakarta.bisnis.com/read/20180508/384/793236/pengurusan-perizinan-di-ptsp-dki-
meningkat-warga-diklaim-puas). But, what is internally perceived is not always the same thing
for other stakeholder (Wahid: 2013). Do people really feel the existence of OSS will help to
cut rule burden and constraint? Is OSS useful in shortening the bureaucratic barrier? Do people
have same assessment with internal assessment? Therefore, it is important to enquire what the
citizens think about the OSS performance besides what is perceived internally by OSS. Based
on this thinking, this thesis aims to answers the following main questions:
1. How is public perception about red tape in Palembang OSS?
2. Is public perception aligned with what is perceived by the government?
3. What kind of practices occur in Palembang OSS that contribute to customer`s
perception?

b. Research objectives/purposes
1. To describe customer`s perception about red tape in OSS of Palembang City.
The citizens are probably the party to be directly impacted by the rules application.
The provided services are aimed to meet their needs. That is why customer orientation
policy is crucial to OSS due to its performance assessment. The OSS customer
perspective about the extent of rules that must be complied to can influence the success
of OSS. This research aims to see the level of OSS customer satisfaction regarding the
rule constraints with the OSS office. A description of the red tape will be given through
the customers’ subjective assessments of burdensome, the necessity and the
effectiveness of rules and procedures they must comply with.
2. To describe OSS employees’ red tape perception regarding rules, procedures, and
requirements applying to their customers.
To complement the customer’s perception about red tape, OSS internal employees
were asked for their opinion about same rules and procedures of service application
processes. The employees were also asked about their perception regarding to those
rule constraints. The aim of this was to increase understanding about how employees
perceived the existing rules and procedures. It is useful to know whether the internal
red tape perception is coherent with the public’s.
3. To provide an overview of the cause of red tape in respect to improve service in OSS.
There are presumably factors that influence the public`s red tape perception in OSS.
This research tries to uncover these factors to provide explanation about the cause of
the red tape. It is expected that this effort will give better understanding about how far
red tape perceptions, especially in OSS, are affected by certain conditions. The ultimate
goal is to help set better rules and procedures within OSS based on perception and
improve services to the community.

1.3.The Research Benefits


Much literature and researches from prominent scholars have studied red tape by measuring
the perception of red tape. Some have studied red tape perception by enquiring into the rules
and application within organizations. Some studies use organizational red tape to measure how

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rules and procedures applied can create red tape for organizations. Others use stakeholder red
tape to know the extent of red tape perceived by stakeholders outside the organization.
This research enquires into the effect of rules and procedures apply in Palembang`s OSS both
perceived by the citizens who need certain services from OSS and employees itself. The
research benefits expected will be academically and societally gained.
a. For Academic
Academically, the results of this study will be expected to provide a deeper understanding of
the theory with real practice in the field. The research may contribute to the concept of red tape
- mainly in OSS. The main focus lies on how to relate the OSS establishment whose main goal
is to ease the burdensome and ineffectiveness with the extent of perceived red tape in OSS
itself.
b. For Society
Some studies have shown that there is a correlation between perception of red tape and
organization performance. As said by Jacobsen and Jakobsen (2018) red tape perception is a
matter for organizational achievement due to its established set of standards. Politicians and
citizens are always expect government agencies to provide excellent services. Thus, rules and
regulations are usually used to maintain preferred quality standards and to maintain the
consistency of service delivery besides safeguarding and accountability. By combining the red
tape perception and OSS application concept, it is expected that the result will give overview
of the OSS performance. By knowing the perception, we can also understand how far rules and
procedures applied in OSS affect organizational goals. As mentioned earlier OSS is expected
to be a useful tool in reducing the burden and complexity faced by citizens who need certain
services or licenses.
The expected practical benefits of this research is to provide materials for the government or
related parties to conduct evaluation and improvements, especially in improving the quality
and ease of service for the community. One focus of this research is how politicians and
decision makers inside government use red tape perception to innovatively reformulate
regulation in order to avoid the extensiveness, burdensome, and ineffective rules and
procedures in public service sectors. This thesis suggests perception as a means to create a set
of rules that fulfil two side demands - simple and convenient procedures for citizens and also
safe and accountable rules for employees. Therefore, this result of the thesis is expected to help
decision makers to design One Stop Shop better in the future.

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CHAPTER II

THEORETICAL FRAMEWORK

2.1. Red Tape


a. Definition
Rosenfeld (1984 in Feeny: 2012) defines red tape as: “guidelines, procedures, forms, and
government interventions that are perceived as excessive, unwieldy, or pointless in relation to
decision making or implementation of decisions”. This definition is challenged by Bozeman
(1993: p.283) who said red tape refers to “rules, regulations, and procedures that remain in
force and entail a compliance burden for the organization but have no efficacy for the rules’
functional object”. Red tape can arise inside the organization or externally, and it also has an
internal and external impact on the organization (Rainey et al.: 1995, p.567). Waldo (1959, p.
369) views red tape as not only a malady of bureaucracy but also as a need within an
organization by saying “one man’s red tape is another man’s system”. There are arguments
surrounding the benefits of red tape for the organization. For example, Landau (1969 in
Bozeman: 1993) argues rules and procedures have important functions even though they seem
excessive on the surface. Kaufman (in Bozeman: 1993) also expresses that red tape is needed
to ensure the representativeness and accountability of government process and to meet the
various demands of different citizens and interests.
Another view is based on a common perception that red tape is a malady of organization. Most
researchers and studies tend to view negative effects of red tape on the internal or external
organization. As suggested by Bozeman viewing red tape as organizational pathology would
reduce confusion about the advantage of red tape. Buchanan (in Bozeman: 1993) viewed red
tape as excessive constraints of structural. While Baldwin (in Bozeman: 1993) separated formal
and informal red tape. According to him, formal red tape related to burdensome personnel
procedures. The later means constraints created by external organizations such as media, public
opinion, and political party. The same opinion exerted by Rosenfeld (in Bozeman: 1993) that
red tape constitutes “the sum of government guidelines, procedures, and forms that are
perceived as excessive, unwieldy, or pointless concerning official decisions and policy”.
For the purpose of this research, it is more beneficial to consider the term red tape as a
pathological concept rather than a positive view. As a malady, red tape can be assumed as a
constraint and something that needs to be avoided by organizations, particularly government
agencies. Not only is this illicit practice concept more suitable with general assumption
perceived by public, but also it is more likely readily operationalized in measurement for this
research. According to Bozeman (1993), there are several advantages to assume red tape as
pathology. Firstly, it is concordant with popular usage. Another reason is there are already
other concepts that encompass certain empirical aspects of rules and procedures. Thirdly, social
construction of reality against red tape as negative or pathological concept. “Red tape is really
a rule or set of rules that have for one reason or another proved ineffective and burdensome”
(Bozeman and Feeney: 2011, p.20).
Type of red tape
Bozeman (1993) distinguishes two basic concepts of red tape based broadly on the general
assumption of being a rules-based concept and bureaucratic pathology of red tape. The former
associates red tape with formal rules, regulations, and procedures created by organizational

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members with legitimate capacity. This notion views red tape as formal rules and procedures
internally, formally originates from inside institution itself. This formal approach has caveat
which is one cannot recognize the rules or procedures as organization pathology as long as they
are legitimate (See Bozeman: 1993). The later - Bureaucratic pathology of red tape - implies
red tape as a malady in organizations. Bozeman gives a rationale for this concept: it fits with
popular opinion even though not sufficient for scientific reason. He states: “That is a good
reason to not view all procedures and controls, even extensive ones, as red tape; (but) it is not
a good reason to view red tape as beneficial”.
Another term known in the red tape discussion is ‘formalization’. Pugh et al. (in Bozeman:
1993) define formalization as: “the extent to which rules, procedures, instructions, and
communications are written”. The same definition proposed by Walsh and Dewar (in Bozeman:
1993) who see “formalization refers more to what the rules are intended to do – increase
predictability in organizational behaviour by decreasing the variance in human performance-
than to their absolute number”. Formalization seemingly covers the rules and procedures set
in organizations in a positive way that benefits the organization itself. This concept tries to
unmask the objectivity of the rules by connecting to its purpose. The problem is one hardly
recognizes which rules - those still imposing - really serve what they are for. Those within
organizations probably claim all rules they established are urgent for achieving the
organization`s end objective. Therefore, this approach is more likely closer to the effectiveness
or performance measurement in the organization.
Bozeman (1993) distinguished red tape based on the source and impact of the rules internally
and externally. Internally, red tape might cause ineffectiveness and loss of morale while red
tape also induces customer defection and client dissatisfaction (Bozeman: 1993). He
categorizes red tape based on external-internal dimensions as follows:
1. ‘Ordinary red tape’ comes from internal organization and impacts the clients or other
organizations.
2. ‘Intra-organizational red tape’ refers to red tape both originating and impacting
inside the organization itself.
3. ‘External control red tape’ is rules that come from outside but impacts inside
organization.
4. ‘Pass through red tape’ denotes to red tape that both originates from and impacts to
outside of organization.
Bozeman has a more developed explanation relating to the red tape debate. He put ‘compliance’
condition for a rule to be categorized as red tape (Bozeman: 1993). He argues that some rules
and procedures formally exist but are neglected because no one is aware of them. Therefore,
he gives two interconnected definitions about compliance: first, compliance requirement refers
to total resources (time, people, money) required formally to comply with a rule (regulation,
procedure) and second, compliance burden encompasses “total resources (time, people, money)
actually expended in complying with a rule”(Bozeman: 1993).He also introduces the ‘rule
density’ term to show the total resources needed by the organization to fully implement all its
regulation compared with total resources expended by it. Bozeman argues that applying rule
density and compliance burden concepts will help to explore the implication of red tape for
organizations.
A more advanced theory of red tape developed by Bozeman based on its subject-dependents.
He distinguishes between ‘organizational red tape’ and ‘stakeholder red tape’. Organizational
red tape, defined as “rules, regulations, and procedures that remain in force and entail a
compliance burden but do not advance the legitimate purposes the rules were intended to serve”

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(Bozeman: 2000, p.12). The later: “a rule that remains in force and entails a compliance
burden but serves no objective value by a given stakeholder group” (Bozeman: 2000, p.83).
The concept of stakeholder red tape is used in this research to provide an overview about what
is perceived by OSS service users or citizens. Bozeman said (1993: p.284): “stakeholder red
tape often will be useful when analysing organizations in terms of coalitions of interests or
when the individual, rather than the organization, is the unit of analysis”. This approach is
expected to match with the objective of OSS itself such as shorten service process and provide
transparent procedure to its consumers. Another reason is it helps to figure out how the impact
of rules and procedures that remain apply inside OSS to external clients or specifically its
service user’s perception. By knowing the citizens’ perception of red tape, it is likely to give
understanding to what extent that OSS has been managed its service delivery so far and fulfil
expectation. By comparison, the public perception of red tape results will be compared to how
the OSS` employees view the red tape in their office. It is expected to give a more
comprehensive result of the red tape level in the OSS internally and externally. As suggested
by Waldo (in Bozeman: 1993) that “one man's red tape is another man's system”. And what
Brewer said that “various stakeholder groups may define red tape differently and hold different
views about its causes and effects in part because if their different stations in the governmental
process” (Brewer: 2009). Therefore, it is expected that both sides of red tape perception which
are externally and internally would give balances analysis for this research.
Bad effect of red tape
Even though some scholars have argued that the red tape concept has a partial positive impact,
however as explained in the previous section, the concept of red tape as pathology is preferably
chosen for this research. The word ‘pathology’ itself has negative connotations relating to
something unnecessary or undesirable due to its bad effect (Kaufman: 2015; Bozeman et.al.:
1992; Pandey and Scott: 2002, & so forth). Pandey, Coursey and Moynihan (2007: p.400)
argue: “The scholarly work prior to Bozeman was polemical in nature, suggesting that red tape
was an inevitable aspect of government, and failed to acknowledge the negative and
dysfunctional aspects of bureaucratic red tape”. This notion is similar to Bozeman (1993, 2000
in Pandey et.al: 2007) who says that the defenses or discussing of beneficial aspects of red tape
is unproductive because they can reduce ability to cut dysfunctional red tape.
One aspect influenced by red tape is organizational effectiveness. Red tape often is associated
with something that undermines the effectiveness of organizations in achieving functional
goals. Pandey (2007) argues that greater red tape can decrease organizational effectiveness and
stronger developmental culture can increase organizational effectiveness. He explains that red
tape inhibits attempts to manage organizations effectively, for example, appraisal from multi-
level hierarchy just to solve operational problems in organizations.
Red Tape can also negatively impact to public trust (OECD: 2001; Walker and Brewer: 2008).
Long procedures and delays faced by citizens can cause frustration and vexation (Kaufman:
1977 in Bozeman: 1993). People question the necessity such procedures and perceive that it is
something irrational. Richard M. Walker and Gene A. Brewer (2008) expressed that red tape
has a strong correlation with corruption and decreases public trust. This asserts the assumption
that people perceived red tape has something to do with corrupt behavior of public officials
(see Frediksson: 2014). Eventually, people’s trust reduces as the service delivery they have is
far away from what is expected.
Scott and Pandey (2005: p.156) show that citizens and governments can be adversely impacted
by red tape. One of concerns is excessiveness in delays and constraints can waste resource
allocation. People would spend more time due to delays and lose opportunity to pursue other

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benefits until the licenses done. Extra cost is required to accomplish many requirements asked
by government agencies. For government employees themselves, perceived red tape constrains
their performance by reducing their motivation (see Jacobsen and Jakobsen: 2018). The
Governments must allocate additional budget and officials to follow the rules established and
perhaps to oversee regulation enforcement. Private organizations often need to hire specific
consultants or intermediaries to acquire permits and licenses before they run the business.
Many resources spent just to obey all requirements and procedures seem redundant and
wasteful because they may be more productively used elsewhere. Bozeman (2000 in Scot and
Pandey: 2005) said that “red tape wastes organizational resources, detracts from
accomplishment of legitimate organizational objectives, and imposes significant costs on
managers, workers, and recipients of government for services”.
Similarly, to the abovementioned, the rules, regulations, and procedures apply not only demand
a compliance burden but also compliance costs for ones who want to fulfil them. Christensen
et.al (2016) gives a complete explanation regarding the cost of red tape. They studied the cost
that had to be spent by 414 SMEs in two municipalities within South Africa in order to follow
the established rules and regulations. In their report, they define compliance cost as all direct
and indirect cost that arise to comply with various kind of regulations. Compliance costs may
encompass real cost and opportunity cost. The first is related to compulsory fees and rates they
must pay, mandated by formal regulation for example retribution to get licenses and permits,
tax. The later refers to cost induced due to time spent for complying. These costs can be
expensed in Once-off cost which means occurred once for example cost for initial company
registration and Recurring Cost refers to cost that company must routinely expense in order to
comply with rules for instances hiring consultants to assist in complying with rules and
regulations. The higher perceived red tape, the higher cost that must be borne by someone.
Thus, the compliance cost of red tape according to Christensen et.al (2016) spans from value
of spent time, additional cost of hiring employees or external sources, costs by delay (overdue
penalty), administrative costs, and efficiency costs. The impact of efficiency costs to economy
most likely occur as a business chose to limit growth, innovation, and productive process as
trade off from avoiding certain regulations, hold to hire new expert employees even when
unemployment rate is high just to avoid employment regulation, high red tape become entry
barriers to monopolize the market, or high regulation may inhibit investment.
All in all, greater red tape is expected to result in greater disadvantages faced by citizens,
private business, and even to the government itself. Greater red tape in a certain organization
or country can be assumed with high barrier and inefficiency. There are trade-offs between rule
compliment and cost expensed. The crowded rules and regulations can be assumed as barriers
for private and citizens. Once again, the bad connotation of red tape is more preferable for this
research, hence, the aforementioned negative impacts of red tape. And, can complement the
understanding about red tape, rules, regulations and procedures that excessively constrain, with
no efficacy to the intended goals. Regulators and legislators are expected to set the rules in an
innovative way that can foster competitiveness and avoid creating rules that increase red tape.

b. Red tape as Perception:


One important thing to be noted is that red tape can be subjective and reliant on perception, as
shown from this frequented quote: “one person`s red tape may be another`s treasured
procedural safeguard (Kaufman: 2015, p.4). This means the assessment of how the established
regulations or rules are vexing or burdensome is strongly dependent on one`s position and
interest. People may have different appraisals to what extent such procedures equate to red tape

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compared to others who may argue those rules are not burdensome because their effectiveness
towards organizational goals. Bozeman et al. (1992: p.292) explains Kaufman`s notion that
some managers feel less restricted by certain rules because they need them. In his study,
Bozeman et.al (1992) suggests that irritation image of red tape is not necessarily inherent with
great arrays of rules but lead to delay or increase in time to take decisions.
Red tape as said by Gouldner (1952 in Scott and Pandey: 2005, p.158) “is determined not only
by the situation itself but also by frame of reference through which it is viewed”. It is related to
experience and expectation of people (Pandey and Scott, 2002; Pandey et al., 2007 in
Kaufmann and Feeny: 2012, p.1196). Yet, Pandey and Feeny (2012: p.1196) criticize this
definition of red tape given by Bozeman (1993: 283) as “rules, regulations and procedures that
remain in force and entail a compliance burden for the organization but have no efficacy for
the rules’ functional object” is as being objective. Perhaps this definition emphasizes that rules
are not red tape as long as they effective in achieving an organization`s goal. But still, citizens
cannot really know how far the efficacy of rules and procedures they have even though those
rules are effective to achieve an organization`s functional objectives. Kaufman (2015: p.5)
exerts that perceptions of government constraints lead to red tape rather than objective
measures. Pandey (1995 in Kaufmann and Feeny: 2012, p.1196) said that red tape is best
viewed as ‘socially constructed reality’ which means rules can be only recognized as
burdensome only through subjective interpretation. This argument also supported by Luton
(2007 in Kaufmann and Feeny: 2012, p.1196) “that most existing red tape measures involve
judgments and evaluations that are better described as attitudinal than objective”.
Jacobsen and Jakobsen (2018: p.26) explicitly define perceived red tape “as the perception that
rules and procedures (formalization) in an organization are detrimental to organizational
performance”. They argue that the definition they provide has three positive characteristics.
First, this definition correlates the perception with the negative impact of red tape on an
organization. As, mentioned earlier, red tape is best viewed as a malady rather than benefit and
its existence is expected to be reduced within organization. Second, they argue that this
definition exerts red tape as a perceptual phenomenon. Third, the definition embraces all
existing rules no matter where they originate from. It seems they want to try to eliminate the
doubt about the beneficial aspect of rules when someone talks about red tape. When people
talk about red tape it means they talk about rules that make unintended ones or constrain. And
of course, this assessment is subjective.
Since red tape is inherent with perception, the difference can be readily found. A number of
studies have assessed red tape in the public domain (Jacobsen and Jakobsen: 2018; Dehart-
Davis and Pandey: 2005; Turaga and Bozeman: 2004, Brewer and Walker: 2009, Scott and
Pandey: 2000; Quratulain and Khan: 2013; and so forth). Besides that, many studies have been
conducted comparing the differences of the red tape phenomenon between private and public
organizations (Bozeman et al: 1992; Rainey et al: 1995, etc.). Nevertheless, there are relatively
few which compare the red tape perception in a given organization internally and externally in
a given time. Many efforts to explore the red tape measure partially one side, inside or outside
of a given institution. This study tries to measure the red tape view in Palembang OSS both
internally and externally simultaneously.
The survey was used as a mean to collect the opinion about red tape perceived by two different
stakeholders, OSS` employees and Palembang`s citizens. For citizens, the sample was
narrowed down to OSS service users as their perceptions are more reliable to the aim of this
research. The object of study is rules and procedures applied in Palembang OSS, particularly
the requirements and steps needed by both service users and OSS employees. The service users
must comply with all requirements set by regulation before they submit their documents and

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get processed further. Employees themselves are bounded by those regulations for procedure
safety and accountability. Those regulations set that the frontline staff are not allowed to accept
and process the incomplete documents. By this, it means that these two different stakeholders
would give their perceptions about same rules and regulation apply to them.

2.2. One Stop Shop


The change of paradigm in public sector from authority or welfare state to service-oriented has
been significant over the last several decades. The citizen or market orientation thought has
pushed reformation in public delivery services. People demand governments to be more
competitive and efficient in services provision. Governments need to find a way to be more
effective and efficient to satisfy their citizens and be more productive. The study conducted by
PricewaterhouseCoopers (PWC: 2012) shows the reasons why governments should put public
service delivery in reformation agenda. Firstly, there is increasing in citizen awareness and
expectation about quality of public service delivery to the same level of private sectors. The
second reason is the demand for government to more efficiently expense money collected from
its citizens (budget constraints). The third argument refers global competition that government
must provide attractive conditions for investors from other countries to help domestic growth.
One way of agenda reformation is public service delivery.
One step towards public service reformation is globally increased adoption of One Stop Shop
(OSS) by various governments. The concept of One Stop Shops is to enable citizens and
customers a single access point to information and service transactions (PWC: 2012). However,
the OSS term itself has some variety due its different contexts and implementation across the
world. Some typically-same terms with OSS are one-door services, Integrated services, single-
window services, community service centers, citizen service centers, information
centers/kiosks, e-enabled service centers (LOGIN Asia: 2017). In Palembang City, city
services center is commonly called as One Door Integrated Service Centre (translated from
“Pelayanan Terpadu Satu Pintu (PTSP)” in Indonesian). Even though Login (2017) reported
that each term indicates the arguable differences among them, the OSS term is used in this
research for consistency and all terms considerably refer to same typical concept and very
different in idea - they all deal with different licensing issues. The discrepancy perhaps depends
on the application and condition.
Generally, there are two kinds of OSS according to facilities they give namely OSS that
provides information and another that provides services (LOGIN Asia: 2017). Wimmer (2002)
uses One-stop Government term that refers to single point access to electronic services and
information offered by different public services. She emphasizes the concept of e-government
using information technology and how different service providers, both government
agencies/authorities and private are inter-connected and are accessible just a single point for
citizens, private or other public administration (Wimmer: 2002). By unifying all various service
providers in one place, she argues that it is not necessary for customers to have specific
knowledge of functional fragmentation of the public sector. The similar opinion is exerted by
Wahid (2013: p.2) that OSS can be considered as a joined-up government that provides four
benefits. They are: “eliminating the contradictions and tensions between different policies,
making better use of scarce resources, improving the flow of good ideas and synergy between
different stakeholders, and creating seamless rather than fragmented services”.
The definition of One Stop Shop Indonesia can be found in some of its legislation products.
The Indonesia Law No: 25 of 2007 about Investment uses One Door Integrated Services
(Pelayanan Terpadu Satu Pintu) term which means the activity of permits and licenses issuance

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that received the authority delegation from initially owned authority body, for whom the
process starts from applying to the enacting of authorization and permissions in one place. This
provided definition refers the OSS as one place offering multi licenses and permits taken from
various government agencies through delegation. It is quite fascinating that the idea of OSS is
included in investment law. The government of Indonesia as stated in this Law`s consideration
wants to create conducive, promotive, fair, efficient and legal certainty investment
circumstance to compete internationally and face global change challenges. This law exerts the
importance of simple and straightforward procedure of permit process to support the
investment growth.
Another definition about OSS also exists in Decree of National Apparatus Empowerment
Minister No: 63/KEP/M.PAN/7/2013 about the General Guidance for Public Service Conduct,
which distinguishes “One Roof Integrated Services” and “One Door Integrated Services”. The
former term means various public services located in one place where each service provided is
not related to each other. Hence there will be multi doors or locket independently for multiple
functions in one building. Different government agencies and bodies do not delegate their
authorities to OSS, but OSS facilitates them to have their representatives in the OSS building.
The following term refers to the idea that multi-services provided by various authorities are
transferred to one channel (one door) thus they become connected with each other. One door
service concept means people do not need to know which government agencies have initial
authority, because all public services are provided in one locket. To conduct this pattern, the
OSS must earn delegation from authority owners.
Currently, Palembang OSS uses the one door service pattern which means it has authority to
conduct various licenses and permit services for the public taken from initially different
agencies through re-delegation performed by the Mayor. The range of services ultimately
depends on the Mayor who has authority as stipulated by National Law. This implies that
Palembang OSS only can provide the public services that only range local government
jurisdictions based on National Law.

a. The ideal purpose of one stop shop


In response to the efforts to make public services better, the establishment of OSS is dedicated
to gain some benefits. The first purpose and benefit expected from OSS implementation is to
cut red tape in government bodies. The long delays and tedious processes inherent with
bureaucracy will be diminished by effective and simple application processing in one place.
OSS aims to offer the citizens a simpler and easier accessibility to get permit or licenses from
authority by putting multi-licences and permits application from different offices into one place.
This way not only help people to get their need faster but also can save time needed to have
their applications done. Wahid (2013) refers the OSS to the establishing of one licensing
department that serve multi services to the public. By shortening the bureaucracy processes
and putting into one place, the OSS can help to cut red tape that often inhibits the citizens. But
still, the extent of red tape decrease still can be argued to be due to people`s perception of
governmental bodies. If red tape perception is relatively low, the OSS will most likely succeed
to achieve their objective.

OSS can also be used to fix the quality of services provision mainly for receiving licenses and
permits. The shift in paradigm of government towards services provider has pushed the
government to change orientation to its customer`s satisfaction. Governments are imposed by
the fact that private often serve better, thus government can learn from private and also perhaps
compete to provide excellent services for public. Thus, OSS often comes with their improved

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standards such as operational procedures, facilities, time, and skilled officers. The ultimate goal
is to eliminate bad practices inherent with bureaucracy and diminish the constraints faced by
the public.

Besides the two aforementioned reasons, the establishment of OSS is also related to an effort
of curbing the corruptive behavior of officers. As some scholars have argued, red tape and
corruption is most likely connected. Too many constraints and complex procedures can
encourage people to give a bribe to ‘grease the wheel’ of their application. People or businesses
tend to spend extra money to have their application processed or completed faster. Businesses
also use the rules constraints as an entry barrier for competitors by colluding with authorities.
People who cannot afford to pay bribes resentfully obey the rules, delays and other vexing
processes. Officers can extort the money by increasing red tape in their organization or
unlawfully offering their skills or connection with incremental charges. The existence of OSS
is believed to suppress those corruptive behavior, establish fairness for all citizens and remove
the negative image of services owned by governments. Thus, OSS must have transparent, fair
and inclusive process and procedures. To ensure the process is as expected, the mechanisms
themselves are embodied with some rules and regulations to limit the discretion, something
that potentially brings its own red tape, something this research enquires.

The delay and long process also can inhibit investments and influence economics. Private
commonly are required to acquire licenses and permits before they run a business. Excessive
rules can constrain new companies when entering a new market if they know the compliance
cost. OSS can facilitate the business to comply with the regulation and receive the necessary
licenses and permits in an easy way. By making the process easier, it would make more
conducive environment to start the business without excessive regulations.
One important thing to consider for any public institution is how to balance between citizens’
demands and internal processes. As it purpose is to ease service delivery, it is crucial to
understand what people expect from the OSS establishment. Citizens’ experience with OSS is
likely to influence the government’s image. If people do not feel satisfied with OSS, they tend
to hold a negative feeling towards the government as a whole. “The citizen and customer
experience are influenced by the interactions and experiences that they have…” (PWC: 2012).
It is self-evident that customer oriented is essential for governments to ensure that the aim of
OSS is relevant with what people expect. Thus, OSS design must be based on the core
principles as shown by PWC (2012) as follows:
1. Listen to your customers
It is essential to understand the customer`s expectation and need in the way services are
delivered according to them. PWC argues that private sector has better understanding
about customers than public organizations. Thus, citizen-centric is important key to
OSS model for success.
2. Break down the silos
PWC refers to more connectedness among different agencies by breaking down
hierarchical structures rather abandoning them altogether.
3. Enable a multi-channel service experience
This notion refers to providing a multi-channel of communication and delivery methods.
Therefore, the citizen can access the service anytime, anyplace and by any means public
prefers.
4. Continuously improve through customer feedback
Customer`s voice is essential to improve the quality of service and also to adjust the
process therefore that would give positive impact on customer`s experience. “Customer

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feedback is a powerful tool, not only for understanding customers’ experience and
satisfaction with public services but also for developing strategies to improve those
services” (PWC: 2012).
5. Set customer-centric service standards
The standards set for OSS must be ensured by enacting formal legislation that focuses
on customer orientation.
One of the OSS’s purposes is to shorten the bureaucracy process that often faced by citizens
when they need certain services from government agencies. The same problem seems to appear
in the business sector, haunted by long and numerus desk procedures and many pre-
requirements from different agencies when acquiring specific licenses for ventures.
Additionally, they must often pay bribes or petty just to make sure their application goes
smoothly or get done by public official (Guriev: 2003; Rohwer: 2009). The establishment of
OSS, hence, is expected become a solution by providing minimum bureaucracy and avoiding
delays in delivery service. However, this is no easy task for public administration to
conceptualize the kind of rules and procedures that fulfil people`s expectations while also
needing rules for organization operational purposes or to achieve organization mission. OSS
sometimes sets their rules and procedures internally and externally which will probably cause
delay in service delivery and can be perceived as red tape by citizens. As stated in PWC (2012)
reports that: “However, this may not be so in reality as OSS can come with their own set of
officials and delays in the provision of services. OSS should also be evaluated for the basic
infrastructure”. Therefore, it is important to explore the extent of rules and procedures
established in OSS organization that still have compliance burden and what the OSS customers’
perception and response is to those applied rules and procedures. Hence, by exploring these
two positions, the result can be used as indicator and standpoint to harmonize and improve the
quality of service in the OSS in the future.

b. OSS in Palembang City


Palembang OSS cannot be separated from the effort motorized by central government to
eradicate the barrier faced by public and private especially when they need certain permits or
licenses. The high red tape was notorious as a bureaucratic malady spread throughout country.
The delay and complex procedures are inherent and typical for government bodies. Thus, one
effort to reform the bureaucracy was the establishment of OSS. The term OSS is used in
Indonesia usually refer to One Door Integrated Shop and One Roof Integrated Shop (Pelayanan
terpadu satu pintu=PTSP) which means providing all kinds of permits and licenses in one place.
In the Minister Decree of State Apparatus Empowerment No: 63/KEP/M.PAN/7/2003, the One
Roof Services Centre means the providing various services that do not have direct process-
connectedness through multiple doors in one place. While One Door Service center means the
provision of multiple services that have connected processes though not only under one roof
but also in one locket.

The OSS policy in this country started in 2007 by enactment of Indonesia Law number 25 of
2007 about investment. Based on this law, the services are provided for permits and licenses
for running the business. Thus, OSS has not included the services such as tax, civil
documentation, among others yet. According to this Law, OSS aims to help investors in
receiving simple and easy services, fiscal facility and information related to investment. OSS
is defined as activity providing permits and non-permits from an authorized delegated
institution whose authority to conduct the activity - ranging from application registration to
document issuance- in one place. The OSS itself uses the concept of One Door integrated Shop

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(PTSP) which means customers do not need to know which agencies belong to which authority.
They just need visit to one place which provides the multiple services they require. This Law
underlies the establishment of OSS in multi-level government nationally.

The purpose of OSS as stated in Presidential Regulation No. 97 of 2014 about OSS is: (1) to
give legal certainty and protection to public; (2) to shorten service delivery process; (3) to embody
fast, easy, cheap, transparent, certain, and affordable service process, and (4) to provide closer and
wider services to public. This Regulation obviously want that each level of government reduces
the red tape as generally inhibits the investors and public in doing their business.

The Palembang OSS was first formed in 2008, led by an echelon 3 with name One Door Integrated
Service Office (KPPT). In 2016, Central government enacted new Government Regulation (PP)
number 18 of 2016 about local government body structure which stipulated that OSS inherent to
local government`s investment agency. Thus, City Palembang then formed local legislation number
6 of 2016 that merged the One Door Integrated Service Centre (KPPT) with Investment Board
which is now called DPM-PTSP and it became one among 28 other departments within Palembang
City Organization. By integrating OSS with the Investment Body, Central Government aims to
improve the quality of delivery service citizens (Article 39 PP 18 of 2016). The Central Investment
Coordination Board (BKPM) said that the merger of One Stop Service with Investment agency in
local government is expected to at least fasten the process, and give more legal certainty as
preferred by investors (Tamba Hutapea: 2014: http://nasional.kontan.co.id/news/bkpmd-dan-
pelayanan-satu-pintu-bakal-menyatu).

According to City Legislation number 6 of 2016, the Palembang OSS has main task to conduct the
technical policy formulation, facilitation, coordination, monitoring and evaluation of investment
and permit services using integrated, synchronized, simple, transparent and legal certain method.
To comply, the OSS has several functions stipulated by Palembang Mayor`s Decree number 60 of
2016 about Establishment and Structures of Palembang Government Organization as follows:
- Formulation of technical policy;
- Policy Implementation within its main task and authority
- Conducting general government duties and services.
- Conducting administration according to authority
- Other task given by City Mayor according to its authority

The Palembang OSS is led by an echelon II chief with one secretary and six division managers.
The division consist of The Investment Climate Development and Planning Division, The
Investment Promotion, The Investment Information and Monitoring, The License and Non-licenses
Services for Economy and Public Welfare Investment, The License and Non-licenses Services for
Development and Environment, The Complaint and Report Division. There are also a technical
and a functional unit to help to assess and verify the submitted documents. Each of division
supervises two-unit sections. The complete structure of Palembang OSS can be seen on picture
below:

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Figure 1. The organization structure of Palembang OSS

The City OSS structure describes the kind of services that currently, focusing on the permits and
licenses related to investment and development. The structure exerts the scope of services provided
by OSS is aligned with underline the organization’s legal base namely Law Number of Law
number 25 of 2007 about investment. Even though the OSS in the future can possibly extend
the range of services not only for investment and development-related permits but also kind of
services related people daily activities such as civil documentation, passports, and others. One
condition that should be considered is about the jurisdiction of authority owned by different
government institutions as stipulated by Indonesian Laws. For example, Law number 23 of
2014 about Local Government divides what kind of authorities are obligated to central,
provincial and city/municipality with autonomy principle. Every level of government has
authorities even though upper government can transfer their power through deconcentrating
and delegating task. For example, the citizen electronic-ID card is currently becoming national
policy held by central government although its implementation involves local governments.

Based on recapitulation from delegation decree of City Mayor, currently Palembang OSS
provide 159 business licenses in 38 license groups as shown in Table2 below:
Table2. The kind of license and permit services in Palembang OSS

Licence/Permit Group Number of Licence products


1. City Advice Planning 1
2. Environment Management 1
3. Hygiene and Sanitation 7
4. Swamp utility 1
5. Advertising 2
6. Construction permit 3

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7. Nuisance permit 4
8. Tourism Registry 22
9. Industrial Permit 4
10. Company registry (TDP) 20
11. Trading Enterprise Permit (SIUP) 6
12. Funeral and Cremation 7
13. Optical Shop permit 2
14. Apothek / Pharmacy 2
15. Drug Store 2
16. Base medical clinic 4
17. Pharmacist Permit 4
18. Technical Pharmacist 2
19. Midwife permit 4
20. Nursery work permit 2
21. Dentist Nursery permit 2
22. Fishery permit 2
23. Livestock Slaughterhouse permit 2
24. Mining permit type C 1
25. City Utility permit 1
26. Liquid waste disposal permit 2
27. Construction consultant 5
28. Public transportation route licence 13
29. Public River transportation route licence 1
30. Doctor`s license 8
31. Operational Licences 8
32. Licence for alcoholic drinks trading 2
33. Modern Shop permit 2
34. Shopping center and mall permit 2
35. Warehouse registry 2
36. Franchise administration registry 2
37. Road utilization permit 1
38. car pool permit 1

Source: DPM-PTSP Palembang, 2018.

Based on the interview, the chief of Palembang OSS is currently trying to establish the Mall of
Public Services. He expects that this center will be opened to public next year. This mall
typically is a center that provides multiple public service provisions nationwide by putting
disparate multi-level of authority into one single building or one roof. The Chief said that with
The Public Service Mall, the government can cover wider and more comprehensive public
needs and not only business-related licence services. He said that although government still
cannot integrate all public services provisions, at least people do not need to attend different
places or be bothered with understanding which authorities deal with which jobs. The Mall is
expected to provide various services such as e-KTP (national electronic ID card), birth
certificates, notary, and immigration office for passports, Land Certificate and Registry
(National Land Body), Water-Gas-Electricity registry, legal and notary registry, so forth
besides existing business licenses provided by Palembang OSS. He suggested that this way
will significantly help citizens meet their needs, reduce the complexity of bureaucracy and
eventually positively impact government performance in reducing rules burden.

2.3. Red Tape Perception in OSS


a. Public perception of red tape in OSS
OSS is often assumed to be an easy, simple, and integrated process with minimal bureaucratic
red tape. When people think about OSS, they would imagine an office which all their needs
with very helpful and handy procedures. This image is built by top administrative and political
leaders in newspapers to gain support from citizen. Unfortunately, what is expected from OSS

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may be different from reality. Wahid (2013:p.2), in his study, he reveals that not all OSSs in
Indonesia have successfully achieved their goals of reducing red tape and providing better
public services. What Wahid says seems fit with what is stated by Caiden (1999). He claims
that many government reformation efforts fail or become disappointing even for successful
claims. He adds the administrative reforms start with much promise but end with
disappointment. Steer (2006) has conducted a research about OSS in Indonesia and his research
says that the OSS experience has been mixed because of many things such as: the freedom of
local government in determining type of OSS (perhaps currently in determining kind of license
given to OSS), lack of capacity and guidance, and resistance from vested interests within the
bureaucracy. This would bring different results about OSS across the country. Thus, the extent
of red tape, which OSS fights to reduce, can vary.
But how can OSS not ensure minimal red tape? As a part of the internal structure in
Government, OSS hardly escapes the bureaucratic trap when they meet with the other
department`s interests. This presumably also happened in Palembang City. As a part of the
wider government system, the OSS’ mechanism still depends on others. This can result in two
things, OSS` existence influence the other departments by encourage them to be better or OSS
gets contaminated by illicit practice from others. Unfortunately, the latter is dominant. Caiden
(1999: p.820) argues that administrative systems are difficult to transform, apparently even
harder than political and economic systems. He exerts that it would take generations to see real
change in administrative attitude. In line with this, Steer (2006) indicates that OSSs in
Indonesia are sometime disrupted by resistance and vested interest from bureaucracy. They
inject their interests to OSS by insisting their involvement in OSS processes and procedures
through rules and regulations.
Another challenge faced by OSS in achieving reduce red tape is integration. OSS is expected
to be an all in one service but the process behind integration is not as simple as imagined. The
integration does not merely provide one locket for all services. It goes further by including data
sharing and strong commitment among different stakeholders, especially political authorities
and administrative bodies. The data sharing means each correlated department is willing to
support the OSS by giving access to their data or integrating their data system. E-government
is one solution which may solve the integration problem. Nevertheless, not all cities in
Indonesia have implemented e-government or share data online. As a result, the integration one
stop government concept cannot be fully implemented. Wimmer (2002: p.151) explains three
recognitions of integration process: one single access point (customer-driven integration),
interconnecting all public authorities (task and expertise driven integration), and integrating
data and resources from different authorities (resources or data driven integration). While OSS
is still struggling to achieve online one integrated services, the public perception about the
effectiveness service delivery will remain in question.
Besides disrupting bureaucratic interests and integration problems, OSS often have their own
rule burden. This what Login (2017) discusses, the existence of OSS does not necessarily
remove the barrier in service provision due to their own rules even though those are set by
political and administrative parties. It is understandable that in issuing the permit, the
administrator must follow certain requirements and procedures. Not only for the accountability,
procedures are established in order to provide safeguards for government and, those rules are
seen as a mechanism to make sure that they make right the decision to the right people.
The public perception of red tape with OSSs may be also influenced by general assumption
and red tape experience from government administration. Many literatures have shown a
negative image of red tape in public domain (Kaufman: 2015; Bozeman et.al: 1992). Scott and
Pandey (2005: p.158) provide two conditions cause higher red tape in public domain. First,

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public managers do not have direct incentive to use organizational resources efficiently like
financial gain in private ones. They tend to accept red tape rather than try to reduce it. Second,
government institutions lack market signals (profit, market share) and alternatively bear
compelling performance indicators such as larger programs, budgets and staff (Scott and
Pandey: 2005 p.158). Another reason is that public institution must often comply with rules
and regulations coming from higher levels of government or from oversight agencies for
accountability (Kaufman: 2015). Bozeman called externally produced rules and procedures as
stakeholder red tape (Bozeman: 1993).
Overall, based on potential bad practices, commonly inherently perception on red tape
government bodies and considerable regulations and requirements apply in OSS, the extent of
red tape level in OSS is expected still occurs as perceived by public. Thus, we can hypothesize
a great amount of red tape perception in Palembang OSS is likely to be evident. We will test
this hypothesis by questioning the citizens who attend the OSS. The term OSS customers is
used at times to represent the Palembang City`s citizens.
H1. Due to current rules, procedures, and requirements they must comply
with, people tend to perceive a high level of red tape in Palembang OSS.

b. Internal perception of red tape in OSS


When people believe that rules, procedures, and requirements they meet in OSS are
constraining, this might be different to the internal perspective within OSS itself. They may
have a different understanding about established rules regarding their positions. This is what
we can expect from the concept of stakeholder red tape from Bozeman (1993). Stakeholder red
tape according to Bozeman refers to “organizational rules, regulations, and procedures that
remain in force and entail a compliance burden, but serve no object valued by a given
stakeholder group”. This implies that different stakeholders complying with the same rules can
have different perspective about red tape. Although multiple stakeholders relating to
Palembang OSS can be identified easily, this thesis limits the stakeholder to two categories.
First, OSS customers represent society at large. Second, internal stakeholders represented by
OSS employees.
The reason why employees may have a different red tape perspective is because they potentially
feel those procedures and requirements are necessary. First, they need formal procedures and
supporting documents to help them decide whether to reject or approve the permit application.
Their final decision should be based on factual evidence. This evidence can be gained both or
either from provided supporting documents or onsite checking. Second, the urgency
perspective also may come because rules are needed to establish uniformity and limit discretion
of employees. They need uniformity to ensure the process is the same for everyone. Kaufman
(2015: pp.58-59) says that red tape often occurs to meet the various and fragmented demands
of citizens and interest groups. Thus, it is common for public service providers to set Standard
Operational Procedures (SOP). Katz and Kahn (1996 in Bozeman et.al:1992 p.291) said that
“The tendency of organizations to routinize decision making and create uniformity in
procedures has long been recognised; indeed this uniformity has numerous advantages”.
Pandey (1997:114) says similarly that “red tape in form of procedural safeguard and excessive
filling forms provides protection against arbitrary and capricious use of power, ensure fairness
and equity treatment of bureaucratic clients”. Third, they need formal rules, procedures, and
requirements as a means of accountability and avoiding blame (Hood: 2007 and 2002).
Government employees use red tape as a safeguard for their job (Kaufman: 2015, p.4). If
something is wrong with their decision in the future, for example: people abuse the given permit,

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it does not become the OSS’s responsibility as long as employee follow the right procedures
and requirements apply. Three reasons make OSS employee tend to support the applying rules,
procedures, and requirements because they feel those regulations are important for their job.
Therefore, if employees believe the rules are necessary, most probably they will feel less about
the red tape.
OSS is a part of a governmental structure that to an extent the bureaucratic paradigm thinking
may also occur in this office. One of characteristics of bureaucracy is procedures dependence,
the old paradigm that restricts the freedom for employee to make decision. Rule-bound is one
of characteristics from Weberian bureaucracy (Welch and Pandey: 2006, p.379). The
dependence on procedures and requirements obviously leads to a high level of red tape, as said
by Bozeman (1993: p.275): “process protection also give rise to red tape”. But which
stakeholders do bear the burden comes from process safeguard? For OSS, it seems the
customers must take that portion. It is interesting to correlate this phenomena with pass-through
red tape as exposed by Bozeman (1993: p.291). Although he said pass-through red tape is less
obvious and less common, this kind of red tape means externally originated rule mainly
impacting the client or customer. This tendency, regardless of the OSS objective, also
presumably applies to Palembang OSS. The problem is, the burden of procedures is often
passed through to the customers who are expecting otherwise. For example, the complexity of
data checking is transferred into some requirements and procedures that must be followed by
clients. It is understandable that government including OSS has to considerably make not only
good but also right decision. Government need some indicators to check the advisability of
applicants. Rather than performing complicated checking work with other departments, it is
easier for public service providers to obligate customers using recommendation letters from
other departments. Rizal (2008) said, by this model, the service providers do not need to
coordinate with others to publish permits or licenses as long as all requirements are met. This
pass-through effect of rules burden leads them to perceive less red tape but customers do
otherwise. Another argument is if employees understand with their organizations objectives,
they will be more tolerant of the rules apply (Moynihan et.al: 2012, p.320).
Overall, because OSS employees have different perspectives about the rules, procedures and
requirements imposed compared with their customers, the second hypothesis is as follows:
H2.OSS Employees have a lower red tape perception than their customers.
The difference in red tape perception even occurs internally within same organization. Walker
and Brewer (2008) show the variation of hierarchical positions can result the difference of
interpretation of organizational purposes, functions, and roles. They enquired different clusters
of managerial groups within public organizations range from senior executives responsible for
the entire organization, service managers whose duties include managing a particular program
or agency, and frontline staff who directly deliver services to the public. The different
functional roles in organizations make their behavioral and thinking about the organizational
rules and procedures different. Walker and Brewer argue that there is a negative correlation
between red tape perception and positions level. Their study argues the lower one`s position in
organizational hierarchy, the more red tape found/perceived. Thus, diverse positions will lead
to disparate assessments of internal red tape
More recent literature from Jacobsen and Jakobsen (2018) showed the perceived organizational
red tape among public managers and frontlines. Their study reveals how the perception among
them can determine the organization`s performance. They explicitly define perceived red tape
“as the perception that rules and procedures (formalization) in an organization are detrimental
to organizational performance. They built three theories about the red tape perception in public
administration. First, employees have significantly higher red tape perception than managers.

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Second, employees` perception of red tape (but not manager`s perception) has a negative but
weak correlation with objectively measured performance. Third, red tape perception has
negative effect on public service performance due to restrict and reduce the employees`
motivation.
The variation of red tape perception inside an organization may also be encouraged by authority
control motives. Rainey, Pandey, and Bozeman (1995) have tried to link the attitude of public
managers in issuing the rules and procedures as a means to secure their control and authority
over their subordinates. Their study’s results show that there is a tendency for managers to
enact more rules and requirements caused by the insecurity over their power and ability to
control their subordinates. They produce regulations and procedures to bind employees that
will make red tape perception greater particularly at the subordinate level.
Like other public organizations, the Palembang OSS has its own organizational structure
formed using legal legislation. The structure typically consists of hierarchical positions and
regular staff. The staff of OSS can be either back office staff or front officers. Each position
has its own duty legalized by regulation. The differences in tasks and duties will likely create
differences on how they see rules applied within their office. Generally, the upper managers
have a duty to control and check the process. They must ensure that every application meets
the obligated requirements and oversee the process. They decide approval, whether the
application can be finished or is rejected. The front office officers receive the application
directly from people who come into the office and briefly check the requirements attached in
the application. They also give explanation to customers about the rules and the follow up
procedures that need to be taken for their application to be completed. After documents are
submitted, the back office will thoroughly recheck all documents attached in the application.
For some licence and permit applications, often they must check the location and hold a joint
inspection with other technical agencies to evaluate the application.
Regarding the OSS, the interaction between the frontline and customers will probably influence
the assessment of red tape among frontline staff. The frontline staff often tend to prefer the
simpler requirements that help people access OSS services easier. Besides that, perhaps they
are influenced by complaints and questions from customers, that indirectly shape their
perception and their knowledge about what is expected by the public. Hence, they support rules
that help citizens in dealing with the services provided and view more rules as constraints to
the OSS customers.
In contrast, OSS managers and back office staff will seek to maintain the safety before giving
approval. Thus, they really depend on procedures that ensure their decisions are correct. They
probably believe that all requirements and procedures are necessary and effective for the OSS
itself safeguarding and ensuring they receive no blame if something goes wrong during permit
issuance. Therefore, it is assumed that the managers and back office will have a lower red tape
perception about rule and procedures applying within the OSS. There is a difference in
perception of red tape among internal OSS due to different levels of positions and roles. The
third and fourth hypotheses are:
H3. The lower someone`s position in organization the higher the red tape
perception.
H4. The frontline staff tend to have a greater level of red tape perception than
managers do.
c. The factors that influence red tape perception
Although numerous literatures and researches seem to extensively cover the topic of red tape,
few study in depth the determining factors that influence people`s perception in OSS. Most

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literatures explain the red tape phenomena, the causes and the effect of red tape (both internally
and externally) perception to the organization. This is understandable since red tape is mostly
assumed as an undesired malady to everyone, the factors that stimulate the perception are not
so demanding compare to red theory itself.
This research is trying to obtain rational behind the perception emersion. While this research
puts greater emphasis on the red tape subjectivity, the factors that influence the red tape
assessment among distinct stakeholders presumably cannot be defined precisely. Brewer and
Walker (2008) suggest that determinants of different red tape perception can diverge among
stakeholders. However, the efforts to collect the possible determinants of red tape perception
is based on clues indicated in some literatures. Although various factors could exist, this
research focuses only on some factors that presumably have a strong influence on the public
perception and OSS service delivery. These factors have been collected from several literatures
discussing red tape and tested on respondents. Among those factors that presumably
significantly affect the red tape perception in Palembang OSS are: delay, transparency, rules
objectivity understanding corruption behavior, and staff skill.
1. Delay
The first factor that have strong influence on the red tape perception is delay. Delay has
commonly been recognized in red tape discussion (Kaufman: 2015; Bozeman et.al: 1992;
Pandey and Bretschneider: 1997, so forth). Even delay has become one indicator haunted by
bureaucratic administration. Timing or delay problem is matter as said by Kaufman (2015, p
16). “Even programs considered successful in the long run, however, will be called red tape if
they are also considered excessively slow in acting on pending matters”. People perceive it is
a red tape if government action or results take longer than they would expect no matter how
effective or urgent processes that need to be followed. Kaufman further explains that this
perception is stronger when people need the service performed immediately. The delay they
have from a few given government agencies often are drawn to the broader system. Even if
people experience only a few agencies, they assume this delay as a typical way working in for
the entire governmental system. This why delay or time needed to complete a task by a
government agency influences the red tape image regardless of rules and procedures.
In OSS, the delay is something that should be avoided. It is interesting to enquire how that
delay can be still occurred in organizations that intend to cut delays such OSS. Delay can come
when the time needed to finish the application is perceived too long and also the result of
missed deadlines, as said by Pandey and Bretschneider (1997: p.115) claiming the total
processing time has contributions from red-tape dimensions of procedural delays. This imply
that delays in OSS can make high red tape perception of customers.
H5. Delay indicates high red tape perception for OSS customers. .
2. Transparency
The second factor that presumably has an influence on red tape perception is transparency. The
availability of information and complaints channel– Kaufman (2015, p.5); “Inadequate
explanation may account for its ostensible pointlessness, or perhaps some critics fail to
evaluate it carefully”. Since red tape perception is not an objective assessment, opinions often
are results from knowledge and prejudice possessed by someone. Meijer (2012: p.5) shows a
transparency issue that correlates between the availability of information and the use of this
information by citizens and stakeholders. The lack of adequate information provided both to
citizens and government officials probably will lead them to assume that regulation is pointless
because they do not know its objective. Even though some may know the goals of such
requirements, they may still think that the usefulness of that regulation can be still challenged.

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That is why information and complaint channels to some extent may influence the red tape
perception.
How does transparency influence red tape perception? Meijer says that transparency is
expected to change government officials’ behavior towards a more efficient, effective and
legitimate manner (2012: p.8). For example, if time and cost are already formally announced,
officials will do their best to complete the task before the deadline and only charge the official
cost to customers, because consumers have the information and would complain if they do
differently. So that, in OSS, citizens know the information about the formal process, time, and
cost is needed. This information is expected to reduce the complexity and uncertainty.
Unfortunately, there is also a tendency that the government office ostensibly makes the
information accessible to pass the box-ticking transparency (Hood: 2007, p.206). Unclear
information is likely to lead to confusion. This would happen if the information provided is
unmatched with what has been officially provided. Unclear and unfit information will make
citizens perceive the process as more complex. In general, transparency can contribute to a
reduction in the red tape perception because information provided helps citizens to prepare for
procedures, time and cost before they submit the application in the OSS.
H6. Transparency indicates low red tape perception.
3. The understanding of objectivity of rules and procedures apply.
There is a lack of theoretical and empirical evidence to support this argument. Yet, the
understanding of why such rules exist and have compliance burden is believed to be important
for one`s perception. The subjectivity assessment may alter after one significant has knowledge
and agreement about the purpose of such rules and procedures. The clearance of the purposive
rules may persuade people from negative prejudice to becoming supportive or voluntarily
obeying regulations. In contrast, one can still perceive red tape even more greatly than before
despite having an understanding of the rules and procedures. The personal background such as
education and experiences perhaps play a role to this perception.
This basic assumption comes from the red tape evolves theory from Bozeman (1993). In his
theory, rules become red tape due to two conditions, namely, inception red tape (rules born bad)
and good rules evolve to red tape (good rules gone bad). There are some reasons why good
rules become red tape according to Bozeman`s theory. Rule drift occurs when people obey the
rules but have no idea about the function and or the reason behind them. This can lead good
rules to become red tape because the meaning and spirit of the rule becomes lost or the
individual inadvertently changes its meaning. The rules may also become red tape because of
misapplication, for example hard to interpret, or people do not understand the rule or rule`s
purposes. OSS has the intended goal of reducing red tape meaning rules within the OSS are
made in consideration of this and to support its goals. By combining these two assumptions,
even though rules in OSS assumed to be good, lack of understanding can change them into red
tape. Therefore, respondents were also asked whether they understood or had knowledge about
applying rules, procedures, and requirements in the OSS. The assumption is if people have a
good understanding and knowledge about the rule`s purpose, they tend to agree with them and
support those regulations. Eventually, this will lead to less red tape perception.
H7. Good understanding about a rule`s objective leads to lower red tape
perception
4. Corruptive behavior
Many theories have shown a strong correlation between red tape and corruption, as previously
explained. For example, Duvanova in her study (2014: p.298) says that: “the source of
corruption lies in bureaucrats’ ability to generate red tape, which creates additional, unofficial

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costs for economic agent”. However, she adds that red tape is only a partial cause –not the only
nor main factors - of corruption. Frediksson (2014: p.256) reveals the function of intermediary
and bribery as a means of time saving instead of get license through the regular procedure.
Related to this, Kaufman and Tummers (2017) reveal the negative correlation between level of
red tape and procedural satisfaction. When people are dissatisfied with procedural steps, their
perception of red tape becomes greater. In the end, the existence of excessive rules most likely
generates a mentality of bribery and corruption and vice versa (Guriev: 2003). An easy process
as preferred by OSS clients would diminish the citizen`s intention to give extra money to
officers because they are already satisfied with the rules and procedures and feel it unnecessary
to hurry the process. Therefore, bribery and money extortion is expected to occur when the
public believes that there are too many constraints in the OSS. If people experience a long
tedious process and excessive rules and requirements in OSS, they will probably look for other
ways to expedite their application. Frediksson says that individual pay bribe to official, or use
an intermediary (that in turn also pays officers) to speed up the process. He says that
bureaucrats will create optimal red tape when intermediaries exist. The same opinion is shared
by Guriev (2003: p.491): “The more red tape, the greater chance to obtain the information and
receive bribe”. Thus, respondents were asked whether they felt it is necessary to give extra
money to have their documents processed faster. The respondents who answered it was
necessary were asked again whether they actually paid money and whether the process
thereafter was faster. It is assumed that if there is a high level of red tape perception in OSS,
corruptive behavior also exists within the OSS.
H8. Corruption indicates high red tape perception in OSS.
5. Competency and skills
Even though studies on red tape and formalization are abundant, it is noticeable that very little
focus on connectedness between employee`s competence and perceived red tape has been
researched. Caiden (1991 in Bozeman: 1993, p.278) suggests perceived incompetence along
with maladministration and delay are red tape. Nevertheless, Caiden (1999) also reveals that
most administrative reform is disappointing when reality is far from that promised. This
phenomenon may be aligned with the administrative reform as OSS intended for. When the
government promise to reduce red tape in the permit process by establishing OSS, the reality
may be hindered by their own officers. One problem relates to competency of government
officials. Woodruffe (1993: p.23) says that competency is “the set of behavior patterns that the
incumbent needs to bring to a position in order to perform its tasks and functions with
competence”. He says that it is related to behavior of efficiency orientation, proactivity, and
concern with impact. Further, he suggests that competency is a dimension of behavior that
correlates to job performance. Besides competency, he also adds specific technical skills as
knowledge and abilities that are required for the job. Because these two terms are strongly
correlated to performance, both terms are used as one into dimension to find the public
perception about the ability of OSS employees to perform their tasks.
There are two types of employees in OSS, back office and front office staff. Most likely, the
OSS clients generally assess only to the front officers’ performance and make a generalizations
on performance of OSS as a whole. Yet, the performance of OSS can be most influenced by
back office who further inspect the documents received by the frontline. The knowledge and
skill of employees can determine the quality of decision and time needed to take that decision.
Thus, this research expects that professionalism to influence the red tape perception through
which the skilled employees can finished the job better and faster. Moreover, skilled workers
give better explanation to the customers.
H9. Skilled and competent employees lead to low red tape perception.

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CHAPTER III

RESEARCH METHODOLOGY

3.1. Method of the research


As previously stated in the objective statement, this research is intended to describe red tape
perception within Palembang City`s OSS. The research method typically used is qualitative
research as argued by Miller and Yang (2008: p.164) that “Qualitative research is a general
term denoting a host of research strategies and techniques that should be specified based on
the research context. Generally geared to exploratory, descriptive, and interpretive tasks of
scientific endeavour, they are invaluable tools of research”. Nevertheless, some argue that
there is a lack of clear dichotomy between quantitative and qualitative because as suggested by
Gabrielian (in Miller & Yang: 2008, p.142) “what is not quantitative is not necessarily
qualitative and vice versa”.
This study aims to document the phenomenon in Palembang OSS regarding perceived red tape
experienced by both OSS service users and OSS employees. A number of questions are asked
to collect their perception about the application of rules and procedures inherent with services
provisions. The OSS services users are chosen to represent the public perception in general
about the constraints caused by rules and procedures. The collected perception is then used to
describe the extent of red tape in OSS. By knowing the general perception of red tape in OSS,
the expected benefit is we can examine how far the OSS achieves its goal of simplifying and
easing the permit application process. Thus, red tape perception is greatly related to the
performance of the OSS.
Operationalization:
To measure the subjectivity of red tape, the concept of red tape needs to be operationalized.
This study uses red tape perception measurements from Erin which consist of three items
namely the burdensome, the necessity, and the effectiveness of rules and procedures applied in
Palembang OSS. The burden is asked to measure the extent of constraints or excessiveness
requirements, steps, and other things need to follow caused by regulations. The necessity refers
to whether the respondents believe such rules are really needed or pointless. Effectiveness was
asked to determine whether those rules have are significant in accomplishing the OSS
organizational goal. Each Three Item Red Tape (TIRT) has scale of five: not burdensome to
burdensome; necessary to unnecessary; effective to ineffective. The respondents are then asked
to give their assessment based on those TIRT. This method is more beneficial as claimed by
Erin, rather than only asking the respondent a single question about how great red tape is in
OSS. Since public perception of government institutions is inherently high, the three-item red
tape is also beneficial for avoiding generalizations by respondent when giving their opinions
on red tape in Palembang OSS. Thus, people did not bring their past experiences to the
Palembang OSS because they only asked about rules and requirements needed in this office.
Another reason is the public may not be familiar with the term of red tape, so one question
about red tape would probably confuse them. Thus, TIRT provides a more comprehensive
assessment of the rules and procedures that can be perceived as red tape later.
To investigate the factors that can influence public perception, the respondents were also asked
to answer some questions that presumably have connectedness in their red tape assessment, for
example: time-delay to get application done, employee’s skill, their understanding about
applying rules and requirements, transparency assessment, corruption attitude.

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3.2. Data Collection
This research uses a survey as the prime method of data collection to probe information about
individuals` views or opinions about the topic. As suggested by Majumdar (in Yang and Miller:
2008, p.241) surveys are popular in public administration to gather information on “work
values and organizational commitment among individuals in public organizations, people’s
opinions on public policies and to gauge the level of their satisfaction with public goods and
services”. To complement analysis, there was an interview with the manager of OSS and OSS
service users as well as internal data and related government reports (audit report, reward, and
achievement).
Survey for OSS employees was performed by sharing the survey link to all of them so they
could answer it. The writer contacted the chief and one manager of OSS to share the survey
through their internal chat group which was ultimately faster and easier to contact all employees.
The writer also asked the chief to encourage his staff to take the survey. The result was a success
by collecting 45 out of 77 employee respondents.
For OSS service users, respondents were chosen on the OSS location just after visiting frontline
employees to submit or take their finished documents. Some respondents took the survey
directly on the spot using a device provided by the surveyor, while others just answered the
survey through a link given to them because it was more convenience to do somewhere else.
To compliment data and to check the robustness collected answers, an interview with OSS
managers and one OSS service user as sample from survey respondent were performed. The
same questions provided in survey were asked and follow up questions given for a more
detailed explanation about their given answers.

3.3. Population and Sampling


The population of this research consists of both employees of Palembang OSS as inside source
and OSS service users as external source or consumers of OSS. The city population was not
considered useful because not all of the citizens have received service from or dealt with the
OSS. The unit analysis of this research is service users of and employees of Palembang OSS
(as individuals). In terms of time, data was collected as cross-sectional which means one point
in time (Miller & Yang: 2008, p.215). Individuals as unit of analysis were given a questionnaire
once to determine their perception about red tape at the moment.
There were two ways to perform sampling of the population defined above. First, this research
used survey for OSS’ employees to find out internal perception about red tape in their
organization. Second, the questionnaire was used for OSS’ Service User to obtain the citizens’
perception. Due to time, cost and resources limitation, the sample size is targeted to cover 50%
of total employees and about 100 respondents from OSS’ service users in Palembang City.
Based on data collected from Palembang OSS in 2018, there are 77 employees in total spanning
from chief to entry level staff as shown on the Table 3 below. All of them were sent the survey
to gather as many as possible answers from internal OSS. The number of targeted respondent
is 50% of total employees.

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Table 3. Population and Sample of Palembang OSS employees

Population of
Percentage of
No Categories OSS Sample
total sample
employees
I Position in OSS:
- Echelon II (Chief) 1 1 2.22
- Echelon III (Upper manager and Secretary) 7 3 6.67
- Echelon IV (lower manager) 15 10 22.22
- Back office staff 42 19 42.22
- Front office staff 12 12 26.67
- Not mention - 1 0.00
II Age Category:
- 18 - 30 years old - 7 15.22
- 31 - 40 years old - 32 69.57
- 41 - 50 years old - 6 13.04
- 51 - 60 years old - 1 2.17
- Others - 0 0.00
III Gender:
- Male 47 24 53.33
- Female 30 21 46.67
- Not mention 0 1 0.00
IV Education:
- Elementary/Junior High School 0 0 0.00
- Senior High School 4 0 0.00
- First degree 51 29 64.44
- Master degree 20 14 31.11
- Doctoral degree 2 2 4.44
- Not mention 0 1 0.00
Total sample 77 46 100.00
Source: Palembang OSS, 2018.

The number of respondents from Palembang OSS employees who gave their answer is 46
persons that ranging from managers, to the frontline staff. This number is over the target. The
writer used a personal approach using the head and one manager of OSS to distribute the survey
through their internal WhatsApp group. This method is considered easier and could reach all
the employees as all were members of the internal social media group. The result was 46 out
of 77 employees giving their answers equating to about 59.74% sample from OSS internal
population. Besides the questionnaire, the chief of OSS and one manager were interviewed to
follow up their answers.
For OSS services users, it is quite difficult to retrieve exact data on them because there is no
fixed number that shows the number of Palembang OSS service users. Thus, I used
accidental/haphazard sampling. Accidental sampling is a sampling technique that choses any
respondents accidently met in the location. For this research, the external respondents were
chosen from OSS customers met in OSS office just after they had submitted or receive a service
from frontlines.
The total sample number from external respondent is 101 people. The detail of external
respondents can be seen in table 4 below:

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Table 4 Sample of OSS customer

Percentage of
No Categories Sample
Total sample
I Age Category:
- Under 21 3 2.97
- 21 - 30 years old 40 39.60
- 31 - 40 years old 36 35.64
- 41 - 50 years old 14 13.86
- 51 - 60 years old 6 5.94
- Over 60 years old 2 1.98
II Gender:
- Male 51 50.50
- Female 50 49.50
III Job:
- Entrepreneur 24 23.76
- Private company employee 30 29.70
- Civil servant/Police/Military 11 10.89
- Housewife 6 5.94
- Student 7 6.93
- Not working 10 9.90
- Others 13 12.87
IV Education:
- Elementary/Junior High School 0 0.00
- Senior High School 32 31.68
- First degree 61 60.40
- Master degree 8 7.92
- Doctoral degree 0 0.00
Total sample 101 100.00

3.4. Data Analysis Methods


- Data Tabulation
To find the explanation about the distribution of three item of red tape, tabulation method was
used to see which components of the questions have prominent connectedness. To check
robustness, I counter the probability determinant factors from surveys to interview answers.
The result was realizing some findings that likely influenced the customer perception of red
tape.
- Interpretation
The frequency distribution is mainly used to draw interpretation about the red tape perception
based on the tree items namely burdensome, effectiveness, and the necessity of rules,
procedures, including requirements applying in OSS.

3.5. How to measure red tape


As the definition of red tape is debatable, someone who wants to measure red tape in
organizations probably has difficulty. It is a critical part, according to David H Coursey &
Sanjay K Pandey (2007), because the concept itself contains measurement models. They
argued that “there is a tendency in public management research, indeed much of social science,
to uncritically employ assumptions of classical item test theory”. Jarvis et al. give an example
of what they called with “nomological status ambivalence” which is whether red tape is

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formative or reflective concept (Jarvis, Mackenzie, & Podsakoff, 2003). The former means
red tape as an “underlying organizational property that becomes manifest in different
organizational domains”. The latter concept refers to sum up of rule inflexibility in different
functional domains (Jarvis, Mackenzie, & Podsakoff, 2003). Formative and reflective concepts
seemingly come from prolonged discussion of different views of red tape as it is rules enforced
for achieving organizational purposes or is rather a number of unnecessary and constraint rules.
Two different models of red tape measurement commonly used by researchers as expressed by
Bozeman and Feeny (2011 in Borry: 2016). The first includes ‘‘self-assessed red tape” term
that usually applied through survey. This measure includes General Red Tape (GRT) scale
(Rainey, Pandey & Bozeman: 1995), Personnel Red Tape (PRT) or Human Resources Red
Tape, and Management Subsystem Red Tape. Another is “red tape as delay” by which it is
used to measure delay and paperwork involved in a job. Borry (2016) criticized the second
measure because this method only captures the length of procedures or rules without
considering red tape as pathology. She argues that GRT and PRT have advantages due to their
performance consistency across studies and all the measures.
A new approach to assess the red tape was introduced by Borry (2016) called Three-Item Red
Tape (TIRT) Scale. Borry built his red tape measurement based on definition given by
Bozeman that is “a rule that is red tape must be burdensome in compliance while also being
useless or unnecessary”. The measure components of TIRT are burden, necessity, and
effectiveness which are drawn from rules-based red tape definition from Bozeman. He applied
a five-scale survey in his study by questioning the policies and procedures with characteristics:
burdensome: not burdensome to burdensome; Unnecessary: necessary to unnecessary;
ineffective: effective to ineffective.
This research uses TIRT measurement to gather information about the extent of red tape on
object study. The selection of this new measure is based upon the advantages expressed by
Borry (2016) as follows:
1. TIRT allows us to measure one single indicator with several measures.
2. The word of red tape is concealed to avoid the influence of its negative connotation on
responders.
3. It directly corresponds to general red tape definition.
4. It captures more readily about perceived red tape within organization.
5. It can be used for internal and external stakeholders of organization including
employees or clients.
Those advantages become a strong consideration to use TIRT as a measure for red tape in this
research. This research is intended to gain information about the extent of red tape in the One
Door Integrated Service of Palembang City both perceived by service users and service
providers. By using multiple measures on red tape, it is expected the result more
comprehensively covers red tape level within the organization and gives a more accurate
description of real conditions in the locus of this research study.

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CHAPTER IV
RESULT

4.2. Red tape perception in Palembang OSS


a. The external perception of red tape
Customer perception is important for the OSS to understand its performance in the context of
reducing red tape. 101 respondents were asked about their perception of the rules` burdensome,
necessity and effectiveness in Palembang OSS. Besides three item red tape questions, there
were also several accompanying questions in the questionnaire. To measure the external
perception, this research chose Palembang OSS’s customers who had experience dealing with
OSS. The sample was collected through accidental sampling. OSS customers were chosen on
location just after submitting their application or dealing with frontline staff. By doing this,
their experience was fresh and made it possible to test the hypotheses on perceived high red
tape in Palembang OSS.
The burdensome perception:
First step, we want to know the level of OSS customers’ perception on the burden effect of
rules, procedures, requirements they faced in the OSS. Table 5 shows the recapitulation of
burden perception. More than half of OSS customers perceived on average the rules burden,
57.43%. While burdensome (22.77%) and very burdensome (0.99%) effect is higher than the
opposite (17.82% not burdensome +0.99% very not burdensome). This result indicates that to
some extent, the OSS customers still felt the rules are extensive. The result also contrasts with
one of the OSS’s purposes which is to relieve the rule constraints and to provide easy service
for the public.
Table 5. The OSS customers’ perception about rule`s burden

Very Burdensome Average Not Very not n


burdensome burdensome burdensome
1 23 58 18 1 101
Answers
0.99 22.77 57.43 17.82 0.99 100.00
%

Min: 1.00 Max: 5.00 Mean: 2.95 Standard Deviation: 0.69 Variance: 0.48 n: 101,

Some reasons were provided by respondents who felt burdened by rules and requirements while
applying. 34 out 101 respondents provided reasons behind rule burden perception. Based on
similarity, those answers in general can be grouped as follows:
- Long bureaucratic process and unresponsive officers (7)
- Supporting documents from other government offices as a requirement (17)
- Confusing and complicated requirements (5)
- Conventional and manual process (4)
- Lack of transparency (1)
It is assumed that the “extensiveness” feeling may come from the number of requirements
consumers must provide when submitting the application. Even though Palembang OSS uses
one door integrated service concept, in reality, the high burden is potentially created through
many supporting documents as a precondition for submitting application. The obligated
documents ironically mean consumers still have to attend several offices which contradicts the
concept of integration and one place service delivery. This implies more effort and spent time

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for consumers. The condition can potentially encourage the corruption effect both internally
and externally in order to overstep some requirements. The data integration problem among
various government departments and agencies presumably causes OSS to still collect data for
checking purposes manually.
Based on the survey (Figure 6), 57 out of 101 (56.44%) OSS consumers visited 3 or 4 different
offices to complete the supporting documents before their applications was processed by OSS.
The 36 others (35.64%) had to visit 1-2 different places to fulfil the set requirements. On
average, based on survey result, the OSS consumers must visit 3 different offices to have their
application processed by OSS.
Figure 6. The number of different government offices that Palembang OSS consumers have to visit to complete the
requirements

The situation above may also lead to differences in calculating the time needed to receive a
particular permit from OSS. The consumers tend to calculate delay starting from the moment
they begin to collect the documents while OSS prefer to start the processing time from the
moment an application is submitted with the complete documents until the issuance of permit.
Hence, even though OSS claims it provides fast process, its consumers still perceived the
process inside OSS as same with others agency. OSS should try to simplify the whole process
not only procedures for applying inside the OSS but also the requirements needed. The use of
e-government perhaps can be a solution to integrate the data among different government
offices and ensure easy access for OSS consumers (Wimmer: 2002; Welch and Pandey: 2006;
PWC: 2012).
The rule`s necessity perception:
The second red tape TIRT assessment is the rule`s necessity. Borry (2016: p.577) said that “a
rule that is red tape must be burdensome in compliance while also being useless or
unnecessary”. The necessity perception from OSS consumers is shown in table 7.

Table7. The OSS customers’ perception about rule`s necessity

Very Unnecessary Average Necessary Very Necessary n


Unnecessary
3 41 7 34 16 101
Answers
2.97 40.59 6.93 33.66 15.84 100.00
%
Min: 1.00 Max: 5.00 Mean: 3.19 Standard Deviation: 1.21 Variance: 1.46 n: 101

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Bottom 3: 50.50% Top 2: 49.50%

There is an answer variation about the rules necessity perception gathered from the survey. The
answers show a balanced spread across necessary and unnecessary. The most frequent answer
is unnecessary with 40.59% from a sample of 101. In contrast, 33.66% and 15.84% of
respondents felt that all rules are necessary and very unnecessary, respectively. The result
shows that the rules necessity perceived by OSS consumers is relatively high.
For checking robustness of necessity perception answers, the respondents were asked they’re
opinions about the complexity of rules, procedures, and requirements in Palembang OSS. There
is a possibility that people did not fully understand what rules necessity meant. The respondents
may have guessed that necessary would be related to rule benefits to them. It was assumed that
Palembang citizens were more familiar with the term of complexity (rumit/berbelit) which
means some extent of pointless steps. Rules are unnecessary when they are pointless or useless.
In fact, the services delivery process and decision making still can be performed properly and
fast without them. Unnecessary rules cause the process to become excessive and complicated.
Figure 8. The respondent’s response about the rules complexity in Palembang OSS

.
Figure 8 shows that when people were asked about their perception on the rules complexity,
they valued it as somewhat complicated. 39 out of 101 (38.61%) respondents perceived the
rules and procedures as complicated and not simple. The majority of respondents (47 or 46.53%)
perceived the rule`s complexity on an average level which means no significant differences
with regular government offices.
The rule`s effectiveness perception:
Table 9. The OSS customers’ perception about rule`s effectiveness

Very Effective Effective Average Ineffective Very n


Ineffective
2 41 12 32 14 101
Answers
1.98 40.59 11.88 31.68 13.86 100.00
%

Min: 1.00 Max: 5.00 Mean: 3.15 Standard Deviation: 1.16 Variance: 1.33 n: 101

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The third TIRT is rule`s effectiveness relating to organizational goal achievement. There are
40.59% respondents that perceived rules are already effective and 1.98% very effective to
shorten and simplify the public service delivery. Yet, there are also a significant number of
respondents who perceived the rules as ineffective (45.55%). If we ignore the respondent who
chose the average, the number of ineffective perceptions exceeds effective ones. This means
that, in some extents, there is still negative perception assessed by OSS customers about the
rules in OSS office.
Overall external red tape perception based on TIRT:
Based on the respondent perception about the rule`s burden, necessity, and effectiveness they
experienced in Palembang OSS, it can be concluded that to some extent there is a relatively
high amount of red tape in this service center although not extreme. This result somewhat
supports the first hypothesis of this research that suggests high red tape perception occurs in
Palembang OSS. From burdensome perspective, some respondents perceived burdensome
caused by rules and procedures apply in OSS more than respondents who felt another way. The
majority (40.59% necessary compare with 33.66% unnecessary) of respondents also perceived
that the existing rules and procedures as unnecessary. They probably think that OSS should
remove some rules and requirements and make the process simpler. Regarding rule`s
effectiveness perception, primarily, respondents felt the rules, procedures, and requirements
were ineffective. Even though a quite significant number of respondents felt they were effective,
the total of effective perspective is below the total of ineffective with the average option is
excluded. Hence, this finding suggests that customers perceived relatively high red tape in
Palembang OSS due to the burden, unnecessity, and ineffectiveness of existing rules,
procedures, and requirements apply.

b. The internal perception of red tape


To assess red tape perception from internal stakeholders, all OSS employees were sent the
survey using three item red tape namely: the burden, the necessity, and the effectiveness. There
are 46 employees who gave their answers about red tape in their organization.

Burdensome:
The burdensome refers to the rules and procedures that seem to be excessive and constraining.
Most employees tended to see that the rules and procedure as no burden to the customers. The
effect of burden is probably not felt by them as they are not the party who bear the rule burden,
they just follow the existing ones and pass the rules to the customers (Bozeman: 1993).
Table 10. The OSS employees’ perception about rule`s burden

Very Burdensome Middle Not Very not N


The extent of burdensome burdensome burdensome
perceived
burden
0 1 7 33 5 46
Answers
0,00 2,17 15,22 71,74 10,87 100,00
%
Min: 2.00 Max: 5.00 Mean: 3.91 Standard Deviation: 0.58 Variance: 0.34 n: 46

From table above, we can see that 33 employees or 71.74% of total OSS internal respondents
believe that the rules and procedures OSS has do not have burdensome effect to the customers.
In conclusion, OSS employee perception about rules’ burdensome effect for its consumers is
low.

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The necessity
The necessity means how internal employees assess the relationship between set requirements
and procedures and the benefits. The rules and procedures can be expected unless people think
the process in fact still can run without those requirements and procedures.
Table 11. The OSS employees’ perception about rule`s necessity

Very Unnecessary Middle Necessary Very Necessary N


The extent of unnecessary
perceived
Necessity
1 1 0 17 46 46
Answers
2,17 2,17 0,00 36,96 58,70 100,00
%

From table above, almost all employees believe that procedures and requirements are needed
to complete the process. 58.70% or 46 employees perceived that all requirements and
procedures apply are very necessary for service delivery, followed by 17 respondents or 36.96%
who think the rules are necessary. There are insignificantly 2 employees who are against the
common answers. There is possibly a related argument about why OSS employees tend to
answer that rules are necessary. The accountability and safeguarding reasons are assumed to
make the necessity perception of applied rules. They need to follow the standard operational
procedures and check the supporting documents before making an approval or decision on the
application (Kaufman: 2015, Bozeman: 1993). Based on an interview with one of managers,
all necessary procedures and supporting documents have been thoroughly examined before
they are put into the rules. The goal is to make sure they provide an accurate assessment of the
applicant file and to avoid mistakes in case something undesired happens whilst issuing the
permit. They do not want to be blamed for future problems, such as abuse of permits. With
respect to the red tape aspect, the Head of OSS said that they have done their best to reduce the
requirements to be not to burden the society, thus the supporting documents requested and the
procedure carried out are felt necessary before deciding whether the permit is given or not.
Overall, we can conclude that internal perception about the necessity of rules, procedures, and
requirements for service delivery in Palembang OSS is high. This means they perceived low
red tape based on the rules necessity applying in OSS.

The effectiveness
The effectiveness relates to how OSS employees see the accomplishment of the organization
goal to improve and ease the service delivery and to provide attractive environment, as
preferred by the public with rules and procedures existing in their office.
Table 12. The OSS employees’ perception about rule`s effectiveness

Very Effective Effective Middle Ineffective Very N


The extent of Ineffective
perceived
effectiveness
12 29 4 1 0 46
Answers
26.09 63.04 8.70 2.17 0.00 100.00
%
Min: 1.00 Max: 4.00 Mean: 1.87 Standard Deviation: 0.65 Variance: 0.42 n: 46

The responses show that most employees believe that the established rules and procedures for
their clients are already effective to achieve their organization goals. 29 or 63.04% employees
see they have effective rules and procedures while 12 or 26.09% think the rules are very
effective to accomplish the organization`s goals. There only one employee who thinks the rules
they have are ineffective.

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Overall internal red tape perception based on TIRT:
Based on burden, necessity and effectiveness measurement, almost all respondents from OSS
employees have tendencies to perceive lower red tape than their customers. There is a sharp
difference in burdensome perception, 71% of OSS employees compared to 17.82% customers
believe that the rules, procedures, requirements in OSS are not a burden. In contrast the
percentage of customers who felt burdened by OSS rules is significantly higher than employees
with 22.77% and 2.17% respectively. The tendency line shows that OSS customers always
have higher burdensome perception than OSS employees. If rule`s burden supports high red
tape, this result supports the second hypothesis that OSS employees tend to have lower red tape
than their customers.
Figure 13. Burdensome perception comparison between OSS customers and employees

80 71,74

57,43
60

40
%

22,77 customers
20 15,22 17,82 employees
10,87
0,99 0 2,17 0,99 Linear (customers)
0
Linear (employees)

The comparison in red tape perception can be also seen from the rules necessity perception in
Figure 14 below. The same tendency also occurs where OSS customers perceived lower rule`s
necessity than OSS employees. The percentage of OSS customers who feel the rules are
unnecessary is 40.59%, compare with 2.17% of employee`s perception. There is a strong
tendency that OSS employee would feel the rules are becoming more necessary as shown in
the graph. For customers, the necessity tendency slightly increases but is still lower than OSS
employees. This result also shows that there is a difference in perception about the rule`s
necessity between OSS customers and employees. The customers have lower necessity
perception than employees which implies they have high red tape perception.
Figure 14. Comparison necessity perception between OSS customers and employees

80

58,7
60
40,59
40 33,66 36,96 customer
%

employee
20 15,84
6,93 Linear (customer)
2,972,17 2,17 0
0 Linear (employee)

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The same pattern also arises regarding the tendency of effectiveness perception between
employees and customers. The figure 15 below summarizes the rule`s effectiveness perception.
The majority of both respondents agree that rules, procedures, and procedures in OSS are
effective, but still, the customer`s percentage is more than 20% lower than employee`s at 40.59%
and 63.04% respectively. Put another way, the OSS customers who felt the rules are ineffective
are much higher than employees with 31.68% for customers and only 2.17% for employees.
Moreover, there are 13.86% of OSS customers who felt the rules are very ineffective while
none of employees felt the same.
Figure 15. Comparison necessity effectiveness between OSS customers and employees

70 63,04
60

50
40,59
40
31,68 customer
%

30 26,09
employee
20 Linear (customer)
11,88 13,86
8,7
10 Linear (employee)
1,98 2,17 0
0

The TIRT results confirms that higher red tape perception occurs among customers rather than
OSS employees. These results support the hypothesis that states OSS Employees have lower
red tape perception than their customers. The result also fits with the stakeholder red tape
concept from Bozeman (1993: p.291) which means rules, procedures that remain in force but
serve no objective value by a given stakeholder group.

To test the hypothesis on the influence of position and role in organization to the red tape
perception, the three item red tape answers above are contrasted with position of each
respondent in OSS using cross tabulation. One respondent did not provide his/her position
therefore he/she is excluded from cross tabulation even though he/she answered the three-item
red tape. There are five different categories of OSS employees spanning from the echelon II
as the highest position within OSS to ordinary staff (non-echelon). The staff were also divided
into two categories namely back-office staff who process the documents and do not have
contact with OSS consumers and front-liner who are directly in touch and communicate with
OSS consumers.

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Table 16. The distribution of burdensome perception among different position in Palembang OSS

From Table 16, each position group in OSS has same opinion about the burdensome level of
red tape with little variation between answers. The majority of each group thinks that the rules,
procedures, and requirements do not create a burdening effect on consumers. Yet, the extent of
not burdensome slightly varies among each group. 90% of lower managers and the OSS chief
perceived a moderate not burdensome level of red tape, while 67% of upper management
thought not burdensome and the remaining (33%) that rule burden is somewhat in the middle
between burden and nor burdensome. The rule burden perception is also not so prominent
between back office and frontline staff with 68% and 67% for not burdensome respectively. In
fact, 33% of frontline staff surprisingly think the rules, procedures, requirements they have are
very not burdensome. This finding is in contrast to hypothesis 4 that initially suggested
frontline staff would perceive higher red tape than back-officer and managers do. With very a
little and insignificant difference, the lower the job position of OSS employees, the lower the
burdensome effect perception. Overall, based on answers given by respondents, there is the
same tendency to perceive low burden effect of rules and procedures apply for internal
Palembang OSS.

Table 17. The distribution of necessity perception among different position in Palembang OSS

.
Regarding rules necessity, the majority from all position groups also perceived that all rules,
procedures, and requirements applying to the public were important and required for the public
service delivery conducted in Palembang OSS (see Table 17 above). The majority of
respondents from each employee group assessed the rules, procedures, and requirements as
very necessary and almost all the remaining answered that rules are rather necessary. There is
a slight rising pattern for ‘very necessary’ dominantly given by higher positions with 70% from
lower management, 67% from upper management and from Chief of OSS compared with 53%
and 58% from back office and front office staff respectively. Thus, the tendency is that the

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higher position one’s position, the more they feel the conditions are very necessary (with one
exception that one upper manager (33%) felt all rules, procedures and requirements are very
unnecessary and should be remove from OSS). The distribution of answers varies mostly
between rather necessary and very necessary particularly for three groups namely, lower
manager (30% and 70%), back office (42% and 53%) and front office staff (42% and 58%).
With the exception of two respondents who perceived unnecessary (1 back office staff) and
very unnecessary (1 upper manager), the internal perception about the necessity of rules,
procedures, and requirements apply in OSS is high with higher positions tending to value
necessity higher. In other words, high perceived necessity suggests lower red tape perception
inside OSS with variation in the extent of the necessity among the lower managers and staff.
This means almost all OSS employees think that the existing rules, procedures, and
requirements are necessary regardless of their positions.

Based on the result in the above paragraph, the hierarchical positions and roles more or less
seem play a role in influencing the necessity perception rather than the burdensome effect
perceived by OSS employees. In stakeholders’ red tape perception, the burden effect can be
passed through to customers while the OSS still need a system or mechanism that guards the
process of service delivery. Internally, OSS employees most likely try to understand existing
rules, procedures, and requirements in the context of organizational purposes and roles first
rather than customers’ views. Walker and Brewer (2008) suggest that the different hierarchical
positions and roles can result in different interpretation on organizational purposes, functions,
and roles. Thus, in the context of rule necessity, all OSS employees tend to feel that existing
rules are necessary for organizational goal but the higher positions would assess a higher
necessity than lower ones. Both Chief and a manager of Palembang OSS said that they need
all applying rules to ensure the process is safe and correct. When they are asked about the effect
of rule burden for citizen, the OSS Chief replied: “We have set the rules and procedures as
minimum as possible to reduce the burden effect felt by customers. We do not put them if we
do not need those requirements”. The manager also exerted:”… All requirements and
conditions apply indeed are very necessary to ensure we make right decision to reject or
approve the applicant. We assess the propriety of applicant based on supporting documents he
submit and some certain permits need field checking to ensure the correctness of given
documents. If something is wrong in the future, we have already followed the standard
procedures, I hope people would understand about this because I think our rules are not so
excessive because we know we have to provide simple process…”

The third is the distribution of rules effectiveness perception among different groups of
employees as shown in Table18 below. In general, the result exhibits that there are no
perception differences about rules effectiveness among groups. This means that the hierarchical
positions and roles do not have a significant effect in influencing the effectiveness perception
on organizational goals contexts. Hence, this result also indicates that the third hypothesis is
not proved for Palembang OSS's internal perception.

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Table 18. The distribution of effectiveness perception among different position in Palembang OSS

As shown previously, most of OSS employee groups perceived high effective for rules in
accomplishing the organization goals. Only one respondent namely echelon II manager
answered OSS have ineffective rules relating to its goal to cut red tape in service delivery.
Respondents primarily perceived effective for the rules they have, with 29 answers. Most
respondents for each employee group chose effective. For example, 60% echelon IV perceived
effective, 30% is very effective, and only 10% chose middle answer. The same pattern also
applies to back office and frontline staff with a sheer different in number (see Table 18)

To conclude, there are two general things that can be summarized from the survey results as
explained above. First, based on the survey, the internal perception of red tape is generally low.
The result indicates that all three items of red tape asked to OSS employees received positive
assessments such as not burdensome, necessary and effective for organization. Almost all
internal respondents believe that the rules, procedures, requirements applying in OSS do not
have a burden effect on the OSS customers. Internally, it means that one of the red tape
perception indicators is low. Their perception about low red tape is most likely because they
do not bear the requirement burden set in their organization. They only follow the rules that
already exist and pass the compliance burden onto clients. The second item of red tape which
is necessity also shows low red tape. Most employees felt that all rules for service delivery in
OSS are needed for the application processes (58.70% necessary and 36.96% very necessary).
Besides that, regarding to the effectiveness perception, OSS employees perceived that all rules
are effective for accomplishing simple and short service delivery (63.04% effective, 26.09%
very effective, and 8.70% average). Second, different hierarchical positions do not significantly
influence the red tape perception among OSS internal employees. The result also shows that
there are no significant differences between frontline staff and managers. All three item red
tape results show that there is insignificant variance between given answers regarding position
and role of employees. A little variation does not mean that there is a large difference in the
burdensome, unnecessity, and ineffectiveness perception. Thus, the third and fourth hypotheses
that suggest a different perception of red tape among internal OSS due to position and role
discrepancy seems unproved at Palembang OSS.

c. The cause of high (or low) red tape perception


This section is dedicated to finding factors that can influence perception either for OSS
customers or OSS employees. Some presumably potential factors were asked to respondents.
The questions for OSS customer were perception, their understanding about rules, bribery
attitude, employee`s competence, the general perception about red tape in government office,
transparency and others.

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As many scholars and literatures have mentioned that the red tape perception in government
administration is higher than private one, the aim was to determine OSS customers’ perception
about the rule`s constraints and excessiveness in government office in general based their own
experiences at Palembang OSS. Complicated rules and procedures were used to refer to the red
tape because it is more popular and understandable in society. The more complicated and
extensive a rule, the higher the perceived red tape by costumers. The result for both perception
can be seen below:

Figure 19. The Palembang OSS customer`s perception Figure 20. The customer`s perception about the
about the excessiveness and constraints of rule and excessiveness and constraints of rule and procedure (red
procedure (red tape) in government sector tape) in Palembang OSS

The charts above show that there is a similar pattern regarding customer’s perception of red
tape both in general government offices and in Palembang OSS itself. This could mean two
things. First, the red tape perception on public domain had influenced the red tape perception
in Palembang OSS. Second, the OSS still cannot reduce the red tape as intended by its goals.
The second is perhaps more reliable as OSS has its own rules and delays in services provision
(LOGIN Asia, pp.16). Besides that, the second meaning is more align with the results of the
TIRT measurement in the previous section. The same pattern possibly arises because they
expected that OSS should provide a simpler and better service mechanism than regular
government agencies. But in reality, they found the red tape difference is not so significant.
Thus, I prefer to say Palembang OSS still cannot reduce red tape as its goal intend. This
argument does not imply the high red tape perception in public domain has (or has no) positive
correlation to high tape in OSS, but rather consumer`s experience lead to red tape perception
in OSS.
Since the public perception of red tape in government agencies is inherently higher than private
as supported in some literatures, the establishment of OSS does not automatically decrease
public opinion of red tape. This research offered some presumably salient factors that may have
significance to the perception. The factors were asked to the external respondents
accompanying the questions on red tape perception in OSS. This was expected to give an
explanation about which factors determine the perceived red tape among OSS service users.
Those determining factors are time-delay, transparency, rules objectivity understanding,
corruption behavior, and staff competence.

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Delay:
Table 21. The OSS customers’ perception about delay in OSS (time needed to get permit done)

Very long long Average fast Very fast n


4 19 67 11 0 101
Answers
3.96 18.81 66.34 10.89 0.00 100.00
%
Min: 1.00 Max: 5.00 Mean: 2.84 Standard Deviation: 0.66 Variance: 0.43

Many of respondents assessed the time needed to issue certain permits or licenses is fairly long
compared to what is expected from OSS. Even though they have already completed all
requirements, they still must wait at least formally 14 days to get their application done. Table
18 shows the processed time is on average speed (66.34%), while 18.81% respondents still felt
the time was long and 3.94% very long. The respondents who felt OSS provides fast decisions
is only 10.89%, this assessment is far from what was expected from OSS. One OSS customers
told her experience that OSS often issued the permit after the promised deadline, and she even
had to wait for over one month for the decision without notice or good explanation from OSS
officers. At worst, she also has ever asked to resubmit her application because the whereabouts
of her previous documents were unknown to the OSS. Based on the interview with the OSS
manager, the customers felt delays when they have to wait for the final decision exceeding was
what officially set. She admitted that many permits and licenses are issued after the deadline
which is a maximum of 14 days. She said that in principle people do not mind waiting within
the officially set standard time. But when the deadline is exceeded, and they still have to wait
again, customers show their objection and complain. She explained, delays are usually caused
bad coordination between technical departments and field inspection hold-ups. The technical
and field review results scan be uncertain and inhibits OSS decision making on a customer’s
application. Trying to solve this problem, OSS Chief said that he wants to cut this procedures
by bringing technical staff, located in different departments, into OSS. Besides that, he will
also replace the manual system with an integrated online system and digital signature. Overall,
delay time has a significant influence on red tape perception. The more delays customers
endure, the higher red tape perceived by OSS customers. In conclusion, it seems that the delay
and TIRT perception is in line which means delays can lead to high red tape perception in
Palembang OSS (H5).
Transparency:
There were two kinds of transparency asked from OSS customers namely: time transparency
and cost transparency. Time transparency refers to providing sufficient information to OSS
customer about time needed to receive their required permits. By providing time transparency,
customers know how long they must wait until everything is completed. The cost transparency
relates to providing sufficient information about official retribution customers must pay for
each application.

Table 22. The OSS customers’ perception about transparency in OSS

Very transparent Average Not transparent Very not n


transparent transparent
5 17 39 31 9 101
Time
transparency
4.95 16.83 38.61 30.69 8.91 100.00
%
Min: 1.00 Max: 5.00 Mean: 3.22 Standard Deviation: 0.99 Variance: 0.98

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6 21 26 31 17 101
Cost
transparency
5.94 20.79 25.74 30.69 16.83 100.00
%
Min: 1.00 Max: 5.00 Mean: 3.32 Standard Deviation: 1.15 Variance: 1.33

Most OSS customers (38.61%) think that the time transparency about how long the process
takes is average. Nevertheless, if we compare the number of people who answered transparent
and very transparent (21.78%) with the number of people who answered otherwise (39.60%),
the time transparency in Palembang OSS is still needing improvement. The number of people
who think OSS is not transparent enough is somewhat aligned with the delay felt by
respondents as shown in Table 22. People probably feel a lack of transparency when they have
to wait longer for the final decision than what was announced.
Regarding cost transparency, 47.52% of respondents felt OSS is not transparent compare with
26.73% that it is transparent (20.79% transparent + 5.94% very transparent). This tendency
based on mean value (3.32) shows that people perceived that Palembang OSS is still not
transparent in cost. The cost transparency perception is closely related to the corruptive
perception as shown in next paragraph. They must potentially still provide extra money to what
was officially stated in OSS office.
Overall, the transparency has an effect on red tape perception to OSS customers by indirectly
influencing the delay and corruption factors. Time transparency is closely related to the delay
while cost transparency tends to influence corruption perception. There are still some people
that perceived Palembang OSS as not transparent enough because there is a difference between
what they officially set and what happens is reality. When people think cost and time is not
transparent, it probably means they perceived higher red tape than otherwise. This finding
supports the sixth hypothesis that states transparency can lower the red tape perception in OSS.
However, this research does not determine the extent of influence of transparency on red tape
perception in OSS. Perhaps future research is needed to reveal the correlation between
transparency and perceived red tape.
Customer understanding about rule`s objectivity:
Another factor that potentially influences red tape perception is the extent of rules
understanding. Based on the survey, there is a significant number of respondents of respondent
who said they understood the rules, procedures, and requirements. 44.55% respondents
understand the rules’ objectives while 1.98 % respondents have excellent understanding about
the rules. The remaining results are 30.69% average, 18.81% not understand, and 3.96% very
not understanding.
Table 23. The OSS customers’ understanding about rule`s objectivity

Very understand average not understand Very not n


understand understand
Answers 2 45 31 19 4 101
% 1.98 44.55 30.69 18.81 3.96 100.00
Min: 1.00 Max: 5.00 Mean: 2.78 Standard Deviation: 0.91 Variance: 0.82

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The tendency as shown by the mean value means that Palembang OSS customers have
sufficient understanding about the rules, procedures and requirements applying in this service
center. If compared to the red tape perception, it can be concluded that the OSS consumers
understanding about rules does not have significant relevance to the red tape perception. Higher
understanding does not lead to reduced red tape perception among OSS consumers. This result
negates the seventh hypothesis of this research that states good understanding about rule`s
objectivity can lower perceived red tape.
Corruption behavior:
The survey also asked the respondent`s perception about the corruptive attitude in Palembang
OSS. They are asked whether the rules, procedures, and requirements currently applied
encourage them to give bribes to the officers. The first question related to the corruptive
behavior: “Do the rules, procedures, and requirements apply in OSS make you feel it would be
helpful to give grease money to OSS employees?” However, this does not mean that people
who answered ‘yes’ actually paid the extra money.
Figure 24. The respondent’s response to the question: Do the rules, procedures, and requirements apply in OSS make you
feel it would be helpful to give grease money to OSS employees?

More than half (53.47%) of the respondents felt that the rules, procedures, and requirements
applying in Palembang OSS make them assume that the bribes are necessary to fasten the
permit process. This indicates that there is still red tape perception in Palembang OSS due to
burden effect of red tape. This perception, of course, does not imply they gave the bribery to
OSS employees. Thus, I asked respondents another question whether they have an actual
experience giving illegally extra money to smooth the process.

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Figure 25. The respondent’s response to the question: have you ever given bribe/money to smooth your permit application
in OSS?

The result (Figure 25) shows that one a third respondent (35 out 101) gave extra money during
application submission to officers. This result supports the poor opinion of cost transparency
in Palembang OSS. People gave money because they felt the procedures were unnecessary and
were taking too long. From 34.65% who answered ‘YES’, another followed up question was
asked - whether the bribes actually helped reduce the rule`s barrier. The response shows that
33 out 35 (94.29%) felt the process in OSS become smoother after they paid the bribe to the
officers (see Figure 26).
Figure 26. The respondent’s response to the question: does your application process become smoother after pay grease
money?

Do the OSS customers still want to pay bribes? Based on the interview with one OSS customer,
who still had to visit related technical departments although the documents were submitted
through OSS. The one weakness of Palembang OSS is the clients` documents are passed
through to relevant department for examination and field checking. This procedure opened the
opportunity for those technical staff to extract money. The customer wanted to ensure her
documents are processed smoothly by technical staff from other departments. She said that
officers often contacted her to come to certain offices outside of OSS and there she would give
a bribe whether asked or not. She felt that if she didn’t give the bribe, her application would be

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processed slower. Thus, she said that the OSS do not sufficiently overcome problems of red
tape even, though she believed the concept was good.
This fact is supported by one OSS upper manager. She said that some employees are
middleman who try to receive private gains from clients. Most of them are back officers. They
offer smoother and easier steps to consumers because they have contact with other departments,
in exchange of payment. She said this pattern disrupts the service delivery, mainly time
punctuality, because staff put the process first for people who are willing to pay at the expense
of non-bribing customers.
This finding supports the notion that red tape and corruption are strongly related (Guriev: 2003).
The existence of OSS does not necessarily reduce the red tape because the same officers gain
private benefits to their pocket from the rules` barrier inside OSS. The greater the corruptive
practises, the higher red tape perception will be. Thus, it can be concluded that corruption can
influence the red tape perception which supports the eighth hypothesis of this research.
How technical skill of OSS employees influence external red tape perception?
Figure and Table 27. The customers’ assessment about the OSS employees` skill and competence

excellent good average poor terrible n


Answers 9 30 49 13 0 101
% 8.91 29.70 48.51 12.87 0.00 100.00

The rule probably is not red tape but unskilled and incompetent employees make the process
slower or far from its intended goal. The basic assumption is a lack of competent officers leads
to higher red tape. To test this assumption, the customers were asked to give their opinions
about the competence and skill of OSS employees. Almost half of respondent (48.51%)
assessed that OSS employees have average skill, while 30 respondents (29.70%) answered
good and 9 persons (8.91) felt excellent. There was only 13 customers who though that OSS
employees had poor skills and were incompetence. Even though the OSS customers were
generally satisfied with officers` competence, it does not necessarily lower the perception. One
customers said that the different interpretation about the requirements among frontline staff

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sometimes made her confused. She further said that this creates the image that employees are
trying to make the process difficult. In conclusion, the competence of the employees does not
necessarily reduce the red tape. The number of requirements and steps needed to be taken by
the customer seem to be the cause of red tape perception rather than employee competence.
This finding does not fit with the ninth hypothesis of this research which states skilled and
competent employees can lower red tape perception in Palembang OSS. Overall, it can be
concluded that employee`s competency and skills have no influence in perceived red tape in
Palembang OSS.

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CHAPTER V
CLOSING

5.1. Conclusion
As already mentioned in previous chapters the red tape perception is important for OSS in
achieving its goal. In general, the OSS is established to solve the problems occurring in public
services provision by governments. OSS is expected to minimize the red tape by providing fast,
easy and cheap public service delivery. Somehow, what is perceived is low red tape by officers
yet the same does not apply to the public. This is based on the results of the survey conducted.
Based on the results there is a difference in the extent of red tape perceived between internal
and external stakeholders. The external tends to be higher than the internal. The red tape
perception comes from the burdensome, necessity, and effectiveness of rules, procedures, and
requirements. This finding is aligned with the theory of stakeholder red tape, that red tape
perceived by someone is a safeguard for another. Different stakeholders can have different
perceptions about red tape.
The OSS customers tend to view relatively high red tape in Palembang OSS. From 101 OSS
customers who took the survey, most respondents thought that red tape was high in in
Palembang OSS, although it is not extremely high. The use of TIRT revealed the extent of red
tape perception according to rules` burden, necessity, and effectiveness. Many respondents felt
the burdensome effects due to requirement excessiveness. Although Palembang OSS use one
door integrated services, in reality customers must still attend different offices to complete all
supporting documents before their applications are processed. Another red tape measurement
is the necessity of rules, procedures, requirements apply in OSS. Most OSS customers believed
that many of the requirements and procedures in fact are not necessary and should ended. Thus,
the process will become simpler and faster. Most OSS customers also have a relatively negative
perception about the rules effectiveness. Even though some respondents felt affected while
other felt averagely affected, however an unaffected perception was higher than affected. This
finding supports the first hypothesis about high red tape perception from external OSS. This
finding also fits with Wahid (2012: p.2):”in the context of Indonesia, the OSS has not yet really
been able to provide effective online services. The citizens may get information, downloadable
forms, and trace the status of an application from a website, but they cannot send the
application online. In order to do so they have to visit the OSS physically to hand in
applications and to make payments”.
In contrast, most of the internal respondents, OSS employees (46 out of 77 employees took the
survey), have low red tape perception based on TIRT measurements. Most employees believe
that the rules applying to customers are not burdensome. They also think that all procedures
and requirements are needed to process and decide applications outcomes correctly with 58.70%
answering necessary and 36.96% very necessary. Regarding the effectiveness perception, OSS
employees perceived all rules as effective for accomplishing simple and short service delivery
times (63.04% effective, 26.09% very effective, and 8.70% average). Since almost all
employees have low perception about red tape in their organization (only one employee has
relatively high red tape perception), it can also be concluded that the different positions and

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roles in Palembang OSS do not lead to different perception of red tape. This finding seems to
negate the third and fourth hypotheses in this research.
The cause of high red tape from customers` perspective mainly comes from the delay,
corruptive behavior, transparency (in cost and time). Those factors are assumed to be connected
to each other. Employee skill seems to not have a meaningful influence on the external
perception. The delay comes from the number of requirements from several different offices
customers attend. Besides that, the long procedures involving the assessment of external
technical departments leads to a longer delay perception. The survey shows that on average the
public needs to visit at least 3 different places to obtain the recommendation letters for their
application.
The second factor that strongly affects the high red tape in Palembang OSS is corruption
behavior which is still related to the first factor. The feeling of excessiveness could encourage
either consumers to pay bribes or officers to extort private gain from customers. More than half
of customers (53.47% from 101 people) felt it was necessary to give some money to smooth
the process. One third of them (35 out 101 people) actually paid a bribe. 33 from 35 customers
(94.29%) answered that they felt their application became smoother and faster after the
payment was given. This phenomenon indicates that the permit application in OSS is still
vexing and pointless. Thus, co
Another factor that correlates to customer perception is transparency. Time and cost
transparency play important indirect roles on perception. Transparency in time and cost give
customers certainty about the time limit and money spent obtaining certain permits and licenses.
The survey shows that the transparency in Palembang OSS is limited because of delay and
bribery. The time and money spent obtaining a particular permit and licence can be different
because customers may have to wait longer than the official deadline time or pay extra money
besides the official cost. This means Palembang OSS has a lack of transparency and led to a
relatively high red tape perception. The result also shows that two other assumed factors
namely rule`s objective understanding and employee’s competence seem to have less influence
on red tape perception in Palembang OSS.

5.2. Recommendation for improvement


The red tape perception is strongly related to the performance of the Palembang OSS. People
perceived red tape in obtaining certain permits and licenses, which means Palembang OSS
should reassess all rules, procedures, and requirements currently applying to customers.
Palembang OSS is using one door integrated services which means various services are
provided through one channel. As stated in Decree of National Apparatus Empowerment
Minister No: 63/KEP/M.PAN/7/2013 about the General Guidance for Public Service Conduct,
integration is key to accomplishing its mission. There are two main complaints from OSS
customers relating to the integration of services. First, the number of requirements must be
fulfil by customers before their applications is processed. Customers still have to attend several
institutions to obtain recommendation letters, which contradicts the primary aim of OSS. Even
though Palembang has already taken various permits and licenses from other governmental
departments into one channel, it would be pointless for customers if they still have visit other
departments. On the other hand, as said by one OSS manager, they need those supporting
documents as evidence to assess the application and make a decision whether to reject or issue
the asked permit. This is aligned with Kaufman (2015, p4).: “one person`s red tape may be

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another`s treasured procedural safeguard”. To bridge this problem, I recommend Palembang
OSS to create an online integration system that links the data from each department. This
system can reduce paperwork and OSS can check the customer’s data online. The concept of
One door service for OSS means people do not have to know how complicated the process
behind the desk is. They only visit one place and obtain everything they need in the same place.
Of course, strong commitment from Mayor and City Legislator is needed to support this effort.
However, this research results do not imply that Palembang OSS has failed to achieve its goal
to shorten the process and provide better public services. As red tape perception is subjective,
the results provide a basis on how OSS can be more aware of public perception. This suggestion
is consistent with Pandey and Bretschneider’s (1997: p.114) that red tape and its principal
observable effect, are related to administrative delay, are information/communications flow
problems.
The second biggest problem that inhibits the realization of integration service in Palembang
OSS is the procedures of document checking involving other departments. As already
mentioned, Palembang OSS provides multiple services taken from various departments in
Palembang City by delegation power. The authority initially owned by those departments and
agencies was closed and given to OSS. But it seems some of those departments have not
completely relinquished their authority. Thus, they insist on involvement in assessing
documents with arguments that they have technical experts and have the data to do so. This
results in a delay in the process because OSS depends on the technical teams before they issue
the permit or documents. This procedure also generates corruptive behavior among officers.
As stated by an OSS customer, she is often contacted by either technical team from departments
or OSS employees. The customer has given bribes whether asked or not to ensure her
documents are assessed smoothly and faster. As said by the OSS manager, this practise not
only disrupts the OSS concept but also influences the OSS employees especially back office
staff- using their experiences and connections- to act as intermediary between consumers and
other departments. To solve this problem, OSS should re-evaluate its rules and procedures by
reducing the involvement of other departments in the decision making process. OSS should
independently issue permits and licenses. Other departments should play a role mainly in
planning and monitoring rather than involved in the direct OSS process. One way to do this is
by establishing their own independent technical experts as well as online data sharing and
integration among departments.
Since the Palembang OSS still uses manual processes for submitting the permit application, it
is better for OSS to start to use e-government so that people can apply for services online and
submit their documents through the internet. This will reduce the contact with officers and
makes it much easier for both citizens and OSS employees. The e-government system ensures
that it is not only information-provision but also provides service delivery or online
transactional functions (Wang et.al: 2012).
Based on the internal survey, most OSS respondents have been working there more than 7-8
years in the same position. I recommend for the OSS to have regular rolling and refreshment
for all employees. Because of the important role of OSS in solving the bureaucratic problem in
service delivery, employees’ performance should be reviewed every year and they should also
conduct open and fair recruitment to replace unfit employees. This step hopefully can reduce
the opportunity for senior employees to make connections and unnecessarily strong ties with
customers.

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CHAPTER VI
RESEARCH LIMITATION

This chapter aims to state some limitation that potentially influenced the result. The first
limitation of this research is about the appropriateness of methodology for interpreting the
survey results. The distribution of the answers of each question was used to interpret the
result. This can lead to the mistakes in drawing the correlation between the research
question and the conclusion. I suggest further research uses a better methodology to gain
better conclusion in the future.

Another limitation is the potential tendency of OSS customers to choose average / middle
answer from the survey question given to them. From the survey result, it can be seen that
there are a significant number of questions where average is dominant, compared to other
answers provided. Possibly, respondent felt confused by the question or felt reluctant to
give an objective answer, although it was stated in beginning of the survey that their
answers would be kept confidential. Another factor respondents may not have been sure so
that they arbitrarily chose the middle answers.

There is also the possibility that OSS employees wanted to give good impression about
their office. They may have given answers that reflect well on their performance. I used the
internal OSS chat group to spread the survey link to make my research easier. But
consequently, another issue arose: the head of OSS may have asked the managers to make
a condition to all employees to provide positive answers.

The number of people I interview was probably too small compared with the number of
survey respondents. For the internal perception, I have interviewed the chief of OSS and
one upper manager to check further the results of the survey. I also conducted an interview
with one OSS customers related to her experiences dealing with Palembang OSS.

Based on the limitation mentioned above, I suggest a more comprehensive and better
designed survey and methodology to obtain more reliable conclusion in a future research.

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APPENDIX

Appendix A: OSS Customers Questioner


--------------------------------------------------------------------------------------------------------------------------------------

Dear Sir and Madam,


I am student of Master in Public Governance at Tilburg University, Netherlands. Currently, I am
doing a research about the burden of rules, procedures, and pre-requirements apply for getting
services in City`s OSS or known as ‘red tape’. Red tape isrules, regulation, procedures that remain in
force and entail a compliance burden for organization but have no efficacy for the rules` functional
object” (Bozeman: 1993)
I am kindly asking your time and willing to participate in this survey. The purpose of this survey is to
gather your perception of red tape based on your experience and assessment in getting the service
from Palembang`s OSS.
For your convenience and interest, your answers and identity will be kept confidential, anonymous,
and will not be published or shared to any parties including City Administrator especially
Palembang`s OSS. Any personal data will be used only for data analysis.
This survey consists of 23 questions and will take about 2-3 minutes.
We provide rewards for lucky participants, if you are interested to the prize, please indicate by
providing your email or contact number in the end of the section.
Thank you for your cooperation
---------------------------------------------------------------------------------------------------------------------------

Q1 - How far is your understanding about the rules, procedures and


requirements apply in OSS?

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Q2 - Did you submit the permit or licence in OSS for yourself?

Q3 - How is your opinion about the burden of procedures and requirements


apply in OSS??

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Q4 - What do you think about the necessity of all procedures and pre-
requirements that have to accomplish to get licenses/non licenses from OSS?

Q5 - What do you think about the effectiveness of procedures and pre-


requirements set in OSS in accomplishing their goals to shorten and ease
service delivery?

Tilburg University - MSc Public Governance 64 | P a g e


Q6 - What do you think about the time needed for finish your submitted
application?

Q7 - How much time you needed to accomplish all asked requirements?

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Q8 - How many offices did you have to visit to fulfill all asked requirements?

Q9 - What do you think about the time transparency in Palembang OSS?

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Q10 - Did you feel get constraints or burdened with all requirements and
procedures in Palembang OSS?

Q10_2_TEXT - Yes, reason:

Yes, Reason: - Text

Proses pelayanan agak lama dan petugas kurang respons terhadapbpelanggan


Birokrasi terlalu panjang, masih harus menunggu beberapa waktu untuk melengkapi seluruh
persyaratan yg di pinta
Petugas agak ketus dalam melayani masyarakat yg melakukan proses perizinan

Prosedur yg cukup panjang membuat pelayanan sering terlambat


Masih ada syarat2 lain yg harus diurus di lebih dr beberapa instansi dan tidak membuat pelayanan
menjadi satu pintu dan terpadu
Persyaratan msh terlihat panjang alur nya dr instansi atau 1 kantor ke kantor yg lain nya
Pengurusan kelengkapan berkas pada instansi lain memakan waktu yg cukup lama, sehingga
membuat proses pelayanan perizinan saya agak terlambat
Ada beberapa persyaratan yg membuat saya bingung
Beberapa prosedur/persyaratan yg harus diurus di beberapa instansi membuat durasi pelayanan
semakin lama
Beberapa prosedur terlalu rumit sehingga membuat saya malas untuk mengurus nya sesuai
dengan sop yg ada
Relatif mengorbankan banyak waktu dan tenaga

Terlalu banyak persyaratannya


Prosedur pelayanan yg masih saja sama dengan pelayanan konvensional pada instansi
pemerintahan lainnya
Prosedur terlalu panjang dan tidak mencerminkan pelayanan yg terpadu dan satu arah
Banyak syarat yg harus diurus ke instansi lain guna melengkapi proses pelayanan, sistem satu
pintu tidak berjalan dengan baik

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Karena, beberapa persyaratan sangat sulit utk diurus di instansi lain dan tidak sesuai dengan
slogan Kppt yaitu Satu Pintu
Byk hal yang mesti saya persiapkan karena banyak pula waktu yang dikorbankan
Konsep pelayanan yg tadinya bisa diselesaikan dalam waktu singkat, tidak bisa terlaksana dengan
baik
Prosedur yg agak berbelit dari pegawai sehingga membuat pelayanan perizinan terasa ribet
Untuk proses pelayanan tidak terlalu transparan dalam hal jangka waktu penyelesaian nya serta
biaya yg harus di keluarkan
Ada beberapa prosedur yg harus dipangkas agar pelayanan berlangsung lebih cepat

Beberapa berkas persyaratan harus diurus di instansi lain yg memakan waktu cukup lama

Ribet

Sedikit repot sih.. kesanq kemari

Ada beberapa syarat yg harus di urus pada instansi lainnya


Untuk zona pelayanan tertentu yg mewajibkan pelanggan hrs punya rekomendasi dari dinas
tertentu harus nya bisa di pangkas
Sop yang terkadang tidak berjalan dengan baik, sehingga terjadi ketimpangan antara masyarakat
dengan pihak pelayanan
harus bolak balik ke kppt mengurus berkas

proses masih manual dan syarat banyak


Seharusnya adm persyaratan sdh terkoneksi dgn instansi lain. Misal data kependudukan dan
pajak/keuangan
Karena seringbkurang persyaratan
Terkadang kita harus bolak balik pergi ketempat yg berbeda dalam melengkapi persyaratannya.
Saranya kalau bisa persyaratannya di sediakan dalam satu tempat saja.
Tempat fotocopy tidak ada.

tiap cs berbeda penilaian ttg kelengkapn persyaratan.

Q11 - With all those rules and requlations, did you feel it would be necessary
or helpful to give extra money to the OSS employees?

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Q12 - Have you ever been given some grease money or other kinds to OSS`
employees to speed up your document?

Q12A - If yes, do you feel your document was processed faster or smoother
after you expensed that money?

Q13 - What do you think about cost transparency in Palembang OSS?

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Q14 - What do you think about the skill and competence owned by OSS
employee?

Q15 - What do you think about the extent of complexity of rules, procedures,
and requirements in Palembang OSS?

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Q16 - Do you feel it would be better to use an intermediary in dealing with
OSS?

Q17 - What do you think about the information provided in Palembang OSS?

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Q18 - What do you think about the access of information for Palembang
OSS?

Q19 - What do you think about complaint service in OSS?

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Q20 - Secara umum berdasarkan pengalaman Bapak/Ibu sekalian, Bagaimana
penilaian Bapak/Ibu terhadap proses pelayanan dan prosedur di seluruh
Instansi Pemerintahan?

Q21 - Your age?

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Q22 - Sex?

Q23 - Job?

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Q24 - Last education?

Tilburg University - MSc Public Governance 75 | P a g e


Appendix B: OSS employees Questioner:
--------------------------------------------------------------------------------------------------------------------------------------

Dear Sir and Madam,

I am student of Master in Public Governance at Tilburg University, Netherlands. Currently, I


am doing a research about the burden of rules, procedures, and pre-requirements apply for
getting services in City`s OSS or known as ‘red tape’. Red tape is rules, regulation,
procedures that remain in force and entail a compliance burden for organization but have no
efficacy for the rules` functional object” (Bozeman: 1993)

I am kindly asking your time and willing to participate in this survey. The purpose of this
survey is to gather your perception of red tape based on your experience and assessment in
delivering the service in your office.

For your convenience and interest, your answers and identity will be kept confidential,
anonymous, and will not be published or shared to any parties including to your institution.
Any personal data will be used only for data analysis.

This survey consists of 11 questions and will take about 2-3 minutes.

We provide rewards for lucky participants, if you are interested to the prize, please indicate
by providing your email or contact number.

Thank you for your cooperation.

--------------------------------------------------------------------------------------------------------------------------------------
Q1 - How long have you been working in Palembang OSS?

Tilburg University - MSc Public Governance 76 | P a g e


Q2 - How far do you know about the purpose of the rules and requirements
apply in OSS?

Q3 - How is your opinion about the burden of procedures and requirements


apply in OSS?

Tilburg University - MSc Public Governance 77 | P a g e


Q4 - What do you think about the necessity of all procedures and pre-
requirements that have to accomplish to get licenses/non licenses from OSS?

Q5 - What do you think about the effectiveness of procedures and pre-


requirements set in OSS in accomplishing their goals to shorten and ease
service delivery?

Tilburg University - MSc Public Governance 78 | P a g e


Q6 - How many training or socialization have you ever had regarding to your
task?

Q7 - What do you think about the income of Palembang OSS employees?

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Q8 - Age?

Q9 - Sex?

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Q10 - Position in OSS?

Q11 - Education?

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