In an increasing number of situations, responsibility for public functions is divided between government agencies and one or more non-governmental organizations. A common administrative example is the outsourcing of information technology functions to private corporations. Both businesses and government agencies have tried to cut their costs and sharpen their focus on their core missions by hiring outside contractors to perform ancillary functions for them. Computer centers, printing and distribution operations, and travel services are all areas where government agencies have taken advantage of private sector expertise to streamline their operations.

A more long-standing and common example is found in many human service programs where government agencies define, regulate, and fund programs that are actually operated by nonprofit (and, increasingly, by profit making) service providers. Sometimes these same programs are also offered by government agencies directly. Shelters for homeless people are a common example at the local level. State and local governments define and regulate programs that are operated by many different nonprofit agencies such as the Salvation Army, church groups, and specially organized not-for-profit corporations. Day care programs are usually operated by nonprofit organizations or private individuals after being licensed by state agencies. Often the government agencies provide training, conduct inspections, and set rates of payment or regulate the fees that providers can charge to their clients. Local trash collection, probably the oldest example of this phenomenon, is now privatized in most communities. Private sector operation of prisons and other correctional services represents one of the newest, and more controversial, examples of this trend to mix public and private activities in a single program operation.

Other major public services are a more loosely connected, but equally complex, combination of public and private operations. Safe public air travel, for example, relies on effective interaction among FAA regulation and air traffic control, private and publicly owned airports, and commercial airlines operating as private concerns, regulated public carriers, and charters.