Defining NGO organizational effectiveness in Indonesia: an unfolding journey more

1st presented at: International Society for Third Sector Research (ISTR) 5th ISTR Asia and Pacific Regional Conference Manila, Philippines, October 17-18, 2007 Defining NGO organisational effectiveness in Indonesia: an unfolding journey Sharon G. Eng, Ph.D. Dr. Sharon Eng has been involved in NGO institutional strengthening for nearly thirty years, beginning with her work with a nonprofit advocacy group in Washington, D.C. in 1980. In 1990, she headed a year-long Asian Development Bank project that provided management training to 33 Philippine-based NGOs. In 1991, she returned to the Philippines to provide USAID support to small businesses producing handicrafts for the U.S. market. From 1992-94, she was founding CEO of the Environmental Bamboo Foundation (Bali). She has consulted on NGO issues with the Canadian International Development Research Center (IDRC); AusAID and USAID among many international donor institutions. Eng embarked on independent research to learn why international development funds flowing to local NGOs often result in disappointment. This culminated in a two-year field study and an earned doctorate in 2006 from the University of South Australia (Adelaide) that focused on the organizational effectiveness of grassroots NGOs in Indonesia. Eng lectures on Southeast Asian study topics and the performing arts at Jakarta International School, and is active in the Indonesian NGO community (2007). ___________________________________ Sharon Eng, Ph.D. 1seunltd@gmail.com Abstract Defining NGO organisational effectiveness in Indonesia: an unfolding journey This paper summarizes a two-year field study aimed at discovering how Indonesian NGO managers perceived, interpreted and implemented constructs of organisational effectiveness (OE) in their workplace. The findings--reflecting emerging trends within Indonesian civil society during a period closely following intense domestic violence and unrest, and growing distrust of Western policies and practices within Indonesia-were compared with the more established views of OE conceptualized by Western for-profit (FPO) and not-for-profit (NPO) organisations. The research indicated a bifurcated view of effectiveness with twothirds of NGO managers interpreting OE that were similar to their western counterparts. However, another third of the responses held radical views on management that focused on ideology, desire for political agitation and endorsement of elusive, nonhierarchical organisational structures of a utopian nature. These alternative, politicized, ideological conceptions reflect Indonesia’s larger political and social concerns and are affecting the work of local NGOs in their communities. KEYWORDS: Indonesian NGOs Organisational effectiveness Radical management NGO management 2 Defining NGO organisational effectiveness in Indonesia: an unfolding journey INTRODUCTION This paper summarizes portions of a broader two-year study completed in 2004 aimed at discovering how five Indonesian grassroots nongovernmental organisations (NGOs) perceive, understand, interpret and operationalise constructs of organisational effectiveness (OE) in the management of their organisations. The paper then compares the findings as they emerged over time within the context of the five NGOs in Indonesia with the more established views of what constitutes OE in Western for-profit (FPO) and not-for-profit (NPO) organisations. Measures of organisational effectiveness in developed economies are typically used to compare organisational achievements against planned outcomes or to compare organisations against each other (Smith, 1998). Yet despite the concept of organisational effectiveness having evolved over nearly 100 years in Western management practice to measure business productivity in Western enterprises, there has been little research undertaken to ascertain to what extent OE can transfer across cultures, political entities and economies. Previous OE research had been largely based on findings from businessoriented for-profit organisations (FPOs) in economically developed societies, and more recently on nonprofit organisations (NPOs), but again largely in developed Western economies. There has been little OE information collected from nonprofit organisations in developing countries. With the exception of Garain’s (1993) OE survey of Bombay-area rural NGOs that confirmed their keen interest in maintaining good relations with stakeholders and volunteers, there are few, if any, empirical OE studies of indigenous NGOs working at grassroots level. The objective of this 3 research was to redress this imbalance by investigating how Indonesian NGOs understand OE, aiming to discover which aspects of organisational effectiveness appear to be relatively universal to all organisations--profits and nonprofits, alike-and which appear to be context-specific. The paper concludes with the author reflecting on these findings as they relate to contemporary organisational and management theories, in particular Hinings and Greenwood’s (2002) ideological and alternative structures of controls; Mills’ (1998, 2002) radical theories of organisations, and Rosengren’s (1993) emerging organisational responses to global political and intellectual change. UNLOCKING THE DEFINITION OF ORGANISATIONAL EFFECTIVENESS The challenge of defining organisational effectiveness (OE) has been ongoing for nearly a century, beginning with the different definitions of effectiveness proposed by the early twentieth century scientific and organisational management writings of Frederick Taylor (1865-1915), Henri Fayol (1841-1925); and Elton Mayo (18801949). From the 1960s through to the early 1980s there have been a proliferation of OE studies, culminating in such seminal concepts as goals and systems resources approaches to OE (Yuchtman and Seashore 1967), multidimensional models of OE (Cameron and Whetten 1983), and competing values model (Quinn and Rohrbaugh 1981, 1983). Forbes (1998), Rojas (2000), and van der Heever and Coetsee (1998) were among several whom have catalogued the numerous theories, methods and approaches to describing organisational effectiveness. Earlier research had tended to classify OE approaches and models using six major frameworks: (1) goal approaches; (2) internal process approaches; (3) systems resource approaches; (4) 4 constituency approaches; (5) domain approaches; and (6) multidimensional approaches. Van der Heever and Coetsee (1998) listed 26 OE approaches used to identify effectiveness criteria and 46 measures of effectiveness criteria; Campbell’s (1977) earlier compendium of OE descriptors identified 30 effectiveness criteria. Scott (2003) defined OE simply as: ...meeting organisational objectives and prevailing societal expectations in the near future, adapting and developing in the intermediate future, and surviving in the distant future (Scott, 2003, p. 7). Recent studies seem to suggest that there remains limited consensus as to its definition and even less consensus as to how it should be measured (Jackson, 1999; Steers, 1975). Cameron and Whetten’s classical statement that OE is but an hypothetical abstraction existing in people’s minds giving meanings to ideas or interpretations about effectiveness that have no objective reality (Cameron & Whetten, 1983) has been well-quoted. This sentiment is reflected by Van der Heever and Coetsee (1998) who write that organisational effectiveness is a construct that must be inferred from the results of observable phenomena, and as a term, must be comparable to such concepts as intelligence, motivation and leadership in that no single models provide holistic representation of such terms (van der Heever & Coetsee, 1998). Similarly, Herman and Renz’s umpire analogy describes effectiveness as ”only what someone says it is (p. 4),” (Herman & Renz, 2000). Walton and Dawson (2001) propose that OE is a construct domain containing three essential elements--value judgments, criteria for assessing effectiveness, and organisational models that reflect mind maps about how organisations function. Thus, in addition to the classic OE emphases on goals, processes, systems and quantitative measures, since the mid-1990s contemporary attempts to define organisational 5 effectiveness include social constructionist and emergent approaches for understanding and defining organisational effectiveness, such as those promulgated by Herman and Renz, 1997) and Forbes (1998). In socially constructed approaches to understanding OE, Forbes writes that conceptually, OE is the product of a process that places emphasis on understanding the interactions within organisations, at best the negotiated end product of: ...repeated interactions between organisational actors and the environments in which they function. ...OE activities allow for interchange of information and communication among participants in their shaping of an organization’s judgments of effectiveness (Forbes, 1998, p. 8). The majority of this extant literature on conceptualizing OE has focused primarily on Western business practices and only in the last two decades has it broadened to include nonprofit organisations chartered in the Western hemisphere. OE in nonprofit organisations (NPOs) Nonprofit organisations (NPOs) have introduced a challenging issue to understanding organisational effectiveness because many Western NPOs share neither similar goals nor common values with their Western for-profit counterparts on which earlier OE research had been conducted. The common measures of effectiveness used in business-oriented enterprises such as financial and productionrelated standards and benchmarks, and various internal performance goals and assessments seem inappropriate to nonprofits because their activities and employees are not financially driven, and because nonprofits often have intangible and amorphous goals 6 (Forbes, 1998; Herman & Renz, 1997, 1999, 2004; Kanter, 1979; Kaplan, 2001; Sen, 1987; Smith & Shen, 1996). Jackson (1999) concluded that since NPOs have quite different philosophies, approaches and activities than for-profit corporate entities, they should avoid normative models that depict organisations as they should be. She identified a number of features as characterizing nonprofit organisations in the United States that could apply equally to NGOs in non-Western countries. These include independence, an overreaching mandate to serve constituent and societal needs, and their structure as communitybased voluntary and/or member organised social service providers (Jackson 1999). However, the designation of not-for-profit tax-exemption status given by governments to their Western-chartered NPOs does not apply to a large number of NGOs in newlyindustrialized and developing countries. Other influences affecting differences in conceptualizing effectiveness Kanter (1979) was among the first to write that organisational purpose (i.e., for-profit, not-for-profit or in developing countries, non-government) can strongly influence the meaning given to effectiveness and how it is measured. Other influences effecting how organisational effectiveness is perceived include Whitely’s (1999) view that contrasts the different approaches of social scientists and economists to issues of effectiveness; Smith (1998), who discusses conflicting views of various internal organisational stakeholders such as accountants and marketing professionals; and Lillrank (1995) who examines the influence of the country of origin of an organization’s headquarters on local views of effectiveness. What is not clear in these debates is to what extent understandings of effectiveness are modified by these parameters and how these modifications are translated into staff actions aimed at achieving effectiveness; the extent of communality in these conceptualizations of 7 effectiveness; and whether there are any universal components of effectiveness that apply to all organisational types in all locations. Such questions have achieved prominence during the last decade as more organisations from the developed world strive to export their management practices to the developing world and find that such transfers are often fraught with operational and conceptual complexities. OE in nongovernmental organisations (NGOs) Not-for-profit organisations in developing countries are frequently labeled nongovernmental organisations (NGOs), and sometimes referred to as civil society organisations (CSOs). Their work involves the delivery of poverty-alleviating social welfare services to people marginalized at the bottom rungs of their nation’s economy, often on a voluntary basis like their Western NPO counterpart, the private voluntary organization (PVO). In Indonesia, two nearly interchangeable acronyms are frequently used to describe NGOs: LSM (Lembaga Swadaya Masyarakat or self-reliant community institution) and LPSM (Lembaga Pengembangan Swadaya Masyrakat or institute for social research and development)--both of which were explored in this research--and a third variety, the Yayasan or foundation. The lines are often blurred as all three organisational forms are often referred to as NGOs. BACKGROUND OF THE STUDY Five Indonesian grassroots NGOs were selected to participate in the study. They were drawn from a larger pool of NGOs based on their availability and continuity. The five NGOs met the following criteria: ●Java-based entities located within reasonable proximity to one another ●Geographical accessibility (some areas were off-limits to foreigners) 8 ●Recognized entities (established offices and activities, not new start-ups) ●Actively working at local level with defined, established grassroots constituency ●History of accomplishments (including project funding from external sources) ●Ten or fewer full-time paid staff (to contain the sample to small, grassroots organisations) ●Willingness, interest and commitment to participate in a two-year research project The questions addressed in this research were how local NGO organisations in the developing country of Indonesia understood and operationalized effectiveness and how their staffs worked toward its achievement. The five NGOs were studied over a two year period, but only part of this data is reported here due to length restrictions. Table 1 on the next page summarizes the seven phases of data gathering over the two years. This paper focuses on the data reported in the yellow-highlighted research activities, Phases I, III, and VI--three focus group discussions with senior NGO managers that asked for their understanding of OE and practices adopted to achieve OE. Table 2 summarizes demographic data about the five NGOs, their constituency and their core staff, a number of whom attended the focus groups. The missions of the NGOs ranged from poverty alleviation through micro-enterprise development activity to farmers’ cooperative education, community environmental protection, and prevention of family violence through gender and child literacy programs. Data show senior managers were articulate, educated, intelligent, intensely idealistic and young--in their late 20’s to mid 30’s. Most had graduated from university in the mid-1990s during the period of great social, economic and 9 political unrest in Indonesia that led eventually to the downfall of Suharto’s 32 year “New Order” regime in 1998. Their characteristics closely resemble Liddle’s (1999) description of the new generation of radical leftist student critics who emerged in the decade of the nineties. These student radicals were, according to Liddle (1999), the most vocal critics against the collusion of business and foreign enterprise, including the political involvement of international donor agencies and multilateral banking organisations such as the World Bank and IMF. Table 1: Summary of research Phase: event/date Phase I: Orientation April 13-15, 2002 Phase II: Field visits (also see Phase VII) Jun. – Aug. 2002 Sample involved Sample 1: Senior managerial team (10 participants) Sample 2: NGO staff and volunteers (75 participants); Outcome of data collected Initial data on historic, social, management milieu of participating organisations Onsite confirmation of physical and management infrastructure and assets including leadership, personalities; human and material resources Review of research methods and management terminologies; initial data on perceptions of effectiveness Constituent attitudes concerning NGO effectiveness; demographic sample descriptors Phase III: Workshop 2, Aug. 2 – 4, 2002 Sample 1: Senior managerial team (10 participants) Sample 3: NGO beneficiaries and constituents (172 participants) Sample 2: NGO staff and volunteers (75 participants) Sample 4: NGO decisionmakers (extension of Sample 1) (25 participants) Sample 5: Research team (5 participants) Phase IV: Stakeholder survey Oct. – Dec. 2002 Phase V Performance Planning Jan. – Oct. 2003 Phase VI: Participant survey, Nov. 15 – 16, 2003 Participant-driven internal management review and effectiveness planning Reports of PAORR cycle of effectiveness programs; formal definitions of effectiveness; participant-designed effectiveness survey Research team’s overall perceptions and observations of participant NGO effectiveness Phase II/VII: Team questionnaire, Feb. 1-Mar. 20, 2004 Table developed for original research Income levels for NGO staff generally paralleled educational levels with 80% percent of NGO managers earning between Rp.1 million and Rp.2.5 million per month 10 (equivalent to $100-250 per month in 2005) versus their community beneficiaries’ average salaries of Rp.250,000 to Rp.500,000 ($25–50) per month. The figure of Rp.500,000 per month ($50) is often quoted as the average minimum level defining poverty subsistence in a typical Indonesian family (ILO, 2000). NGOs served constituents in both urban and rural Javanese society. Advice from NGO experts working in academia and multinational donor organisations in Indonesia, as well as Indonesian grassroots organisations confirmed that this composite sample population was representative of local grassroots NGO staff and constituent populations residing in urban and rural Java. FINDINGS Transcripts of the focus group meeting were analyzed using the qualitative analysis software NVivo6 that reduced transcripts to major themes. All participants were initially wary toward the research: they were skeptical of research that reduced participatory efforts and findings to numerical statistics, and to research methodologies that benefited the researcher and not the participants of the study. Initially the majority of participants expressed hostility toward Western influences as expressed in some of their goals for specific outcomes during various focus group processes: ●Goal of a grand collective strategy to oppose Western domination through organisational management and movement management. ●A collective formula by the farmers (to expunge) forms of ideological colonialism that marginalize them. ●A simple technical formula to rid the existence of “colonialism.” (Eng and Widayatsih 2002b, pp. 13-14) 11 Table 2: Sample Demographics Table developed for original research One participant stated that the term organisational effectiveness was “Harvard Business School language” and therefore irrelevant to the management of NGOs in Indonesia. Others, however, were less scathing and more likely to see value in efforts such as keeping books and developing standard operating procedures. All of the Indonesian managers felt their work in NGOs was important because of: (1) 12 NGO relevance in society, (2) their nation’s transition toward democracy, and (3) their need to balance Western hegemony in their country. Their discussions contained elements that were contradictory and perplexing with three major themes emerging. Illustrations of the first theme were discussions that described their understanding of organisational effectiveness as activities that the organization must attend to in order to become effective (e.g., consistency, timeliness, usefulness, and efficiency) and/or as characteristics of an effective organization, e.g.: ●guaranteed monitoring and evaluation ●being well understood ●ability to balance resources and needs ●flexibility ●measurable output of time ●personnel management ●money management Approximately one third of their discussions used this type of language reflecting effectiveness approaches and models identified in the Western literature on for-profit businesses as generally they were in agreement about the need for financial and other forms of control. A second theme illustrated mission-related activities such as establishing mutuality of vision, mission and goals, and developing and maintaining stakeholder relationships that was also identified in the Western literature on non-profit organisations. The third theme related to aspects of their political environment, including activities to become autonomous, to empower their stakeholders, and to advocate societal change. 13 Indonesian managers thus indicated they understood, interpreted, and operationalized organisational effectiveness both similarly and yet differently than both Western for-profit businesses and nonprofit organisations in that, to them, OE not only comprised the typical financial or resource based measures adopted in Western FPOs, but also comprised another two additional sets of activities relating to their communities-- first their role within their constituency and their mission; and secondly, the means of achieving important political goals. Chart 1 below shows the major themes that emerged in NGO leader focus group discussions in their defining of organisational effectiveness: 1) involvement with community; 2) possessing a clear ideology; 3) comprising strong management;4) having a clear vision and mission; 5) possessing adequate resources; 6) retaining flexibility: Chart 1: Participant definitions of organisational effectiveness Chart developed for original research 14 Much of the discussions revealed significant gaps between their ideals and their actual achievements. For example, while most managers felt their organisations possessed mature financial planning, in actuality, they disagreed both between and within NGOs as to the need for external funding support from donors and government and for the need to develop fundraising strategies to maintain financial viability. Similarly, while all managers felt that they had short, medium term and long term planning procedures in place, in practice, the majority of organisations did not have operating plans for longer than a year at a time. Discussions within the focus groups centered about one third of the time on how to design and implement standard operating procedures and information/documentation procedures, as well as ways and means for developing and training staff--activities which one might also associate with discussions of OE in the developed world. Approximately another third of their activities was focused on how to develop and maintain localized relationships, communicate with stakeholders outside the organization, and strive within and without for mutuality of goals, solidarity, empowerment and self-help--activities more similar to the typical NPO style operation in the developed world. This focus reflected their constituency and their perceived role within it. But permeating all focus group discussions was the third dimension identified above--recognition of the dominant role of ideology as reflected in their embracing of political issues within their surrounding community and lives. For example, managers frequently suggested criteria and values that described efforts to mobilize, advocate, influence and affect societal change. Activities utilized to transform the internal organization were thought by participants to be also transforming the organization’s external political landscape. For instance, management discussions about how to become organisationally and financially independent extended to how to empower stakeholders so they might achieve 15 autonomy from government, business and donor influences. While two of the NGOs engaged in primarily striving to provide tangible services appeared to be moving toward more conservative orientations, two other NGOs engaged in community mobilization and issues advocacy were moving toward more radical organisational structures and processes. Results of OE research conducted by Kaplan (2001) in his attempt to apply usage of his business-oriented balanced score card to NPOs in the United States and OE research conducted by Young, Koening, Najam and Fisher (2002) also reflect similar contradictions of policy and implementation. Kaplan (2001), and Young et. al. (2002) also found that NPOs felt that democratic decision-making, broad participation and maintaining relationships were paramount in the eyes of participants, and these attitudes often hindered the ability of NPOs to make tough business decisions or reduced organisational flexibility and adaptability to change in the case of membership organisations, which valued slow consensual decisionmaking processes over quick responses. Equally perplexing in the Indonesian sample were conflicting results regarding the organization’s need for community acknowledgment of their existence, and for support of donors and government on the one hand, and the participants’ strong emphasis on building trust and representing community interests on the other hand. It seemed as if these NGOs desired to protect their communities from the perceived harmful external influences of donors and government. Many, but not all participants were uncomfortable with Westernized concepts regarding the linear nature of logic, leadership hierarchies, and formalized reporting structures. These attitudes were operationalized in a number of ways. One NGO, for example, attempted to blend its organisational structures with community practices by purposely dismantling its legal status as a foundation (Yayasan) to 16 become a collective and more recently to become a “farmer’s secretariat,” a more radical form of structure. A second NGO empowered each staff member to represent the organization in all areas of functional support (leadership, finance, fundraising, project management). At a third NGO, professional staff, volunteers and stakeholders undertook identical duties, which caused problems in the areas of human resources and staff payroll budgeting. Three NGOs that more closely approximated Western-style management practices in their organisations seemed more conscientious in responding to official development project requests, and were generally more accommodating and responsive toward government and donor institutions. They exhibited more stability in managing infrastructural resources; articulating vision, mission and goals; providing organisational structures, financial and staff controls and procedures; and implementing program audits and assessments. Three of the five NGOs--one of whom initially employed Western-oriented organisational management practices, exhibited radical orientations to their systems of management including unique management structures, outright opposition to government and industry, strong political advocacy, vocal and material condemnation of opposing forces, and active community organizing and political discourse. Two of the three organisations who had stable management based on conventional Western practices were known to be successful in the field. The third organization was even more radical in its orientation, subscribing to a quite unusual model of governance that could best be described as an “un-organised” form of organization—one that was based on a neo-Marxist ideology that shunned formal hierarchical structures and displayed characteristics that were idealistic and utopian in outlook. 17 The managers of the NGOs reported themselves as feeling under pressure from aid organisations to converge with Western management practices and become more businesslike, more professional, and more skillful at what they do, thus achieving effectiveness by carrying out their visions, missions, and goals within parameters that are acknowledged and accepted by formal external constituents. They adopted whatever adjustments were necessary to accommodate the demands of benefactors in order to receive funds and assistance to meet donor objectives that often clashed with their own long-range objectives. Such were often seen as necessary but nuisance activities to maintain the funding base. Simultaneously NGOs also experienced constituency pressures that forced them to develop divergent practices in their own working milieu. These internal pressures resulted in the creation and pursuit of additional organisational goals and objectives through local political means, as exemplified by two NGOs, and to some extent a third NGO--all of whom were unwilling to give up their sovereignty as independent, autonomous organisations. These NGOs rejected assistance from corporations, donors, and government in order to maintain an arm’s length from outsider influences, which they perceived to be antithetical to the well-being of their communities and to their ideology. They distrusted foreign influences and were not willing to engage in activities that might jeopardize their constituents’ best interests, including having to discuss their internal affairs or open their financial records to outsiders. Nevertheless, these donoreschewing NGOs continued to seek funding from external donors. NGOs that rejected Western donor support and their managerial protocols (e.g., donor requests for timely financial statements, and external and/or internal monitoring and evaluation of projects to satisfy donor-funded activities) tended to be the most vocal in criticizing donor and government interference, and in proclaiming their self-sufficiency, autonomy and 18 independence from government, corporate and international donor influences. Expanding on Eldridge’s (1995) matrix of Indonesian NGO paradigms, Table 3 shows that the research clearly suggests a dichotomy between conservative and radical approaches to understanding organisational effectiveness. Table 3: NGO convergence/divergence with Western management practices NGO Standard operating procedures in place; stable management protocols Values interaction with Western funding sources Rejects Western concepts of management Proautonomy, eschews external donor interference (int’l donor, business, government) Radical forms of internal management Considers themselves politically active and antigovernment anti big business Description of OE activities operationalized during term of study 1. NGO3 2. NGO4 X X X X X X X X X X X X X X X X X Re-evaluated vision-mission, wrote new funding proposals to donors Re-evaluated vision-mission, restructured administration, wrote new funding proposals to donors Revised vision, mission, goals for medium term; restructuring current project to better reflect constituency needs Radically altered organisational mandate, structure, format, mission, vision, goal-became new organisational entity Revised organization structure, standard operating procedures, operations handbook 3. NGO1 4. NGO5 5. NGO2 Table developed for original research 19 CONTEXTUAL INFLUENCES ON EFFECTIVENESS Location, Purpose, Time, Space Among the many potential differences emanating from context, the author has selected time, place and purpose for further discussion as these involve major differences between the site for this data collection and Western sites that have been the primary locus for earlier research. The key dimensions of site differences include differences in location (external), differences in purposes (internal), and differences in historical development (time). Whitley’s (2003) assertion that the nation state as the primary unit of political competition and legitimacy defines business systems in their region and that this varies significantly from place to place leads to the belief that NGO management systems can also reflect regional differences among players within defined cultural and social-political-economic boundaries. Purpose defines the fundamental raison d’etre for an organization’s existence. Indigenous NGOs working in developing countries may not have the luxury of being able to choose their destiny or to define their internal purpose if this is isolated from external influences. Dominant goals are usually to assist and empower their grassroots constituents, and to respond urgently to unexpected events. This may explain the lack of precise planning and organisational clarity exhibited by many NGOs in the Indonesian sample: the nature of their work—disaster management, social services caretaking, proposal writing--is often a rapid response to environmental exigencies over which they have very little control. Within a developing country context, NGOs are often at odds with the nation state, particularly in emerging democracies. In this context the Indonesian NGOs in this study represent anti-business and it may well be that Whitley’s (2003) proposed framework for describing business systems as those which complement the 20 institutional characteristics of the nation state should also take into account opposition institutions that will utilize those business systems to legitimately challenge their competition. The expanded role of NGOs in society--anti-corruption critics, environmental protection and human rights advocates--stems from purpose-creating social, cultural and political pressures forced upon local NGOs from without. Moreover, many local NGOs are constantly altering their organisational prerogatives to respond to donor project requirements: today it may involve structural reform, participant training, and democratization; tomorrow, it may be civil society strengthening, rural education, or institutional development. They (and their community stakeholders) are involved in a tapestry of changing time, space and purpose. Their understanding of OE is grounded in a philosophical view of the world that is existential in context where organisations are inseparable from their environment. Within this ever-changing political landscape that is often dictated by external circumstances, the perceptions of effectiveness by these Indonesian NGOs and their means for coping do seem rational as they enable NGOs to act predictably in an unpredictable environment. The researcher’s findings reinforced previous research that has shown that Western-based management systems and business models of OE are not particularly suitable to NPOs, large or small (Jackson 1999, Kaplan 2001, Smith 1999a, 1999b) not only in North America and Europe but elsewhere--in particular, most grassroots NGOs functioning in the non-Western world as in this study of Indonesian NGOs (Demenet 2001, Edwards et al. 1999, Fowler 1996, KhouriDagher 2000, Lindenberg 2001). Participants’ resentment toward Western geopolitical domination, and questions of relevance, sustainability, effectiveness, influence, purpose, and constituency have revealed themselves to be the core issues in this study. 21 The author began with simple questions of how grassroots NGOs in Indonesia define organisational effectiveness in the workplace, and how these constructs are operationalized, yet the actual findings have taken the researcher on to another path. Organisational effectiveness as seen through the eyes of NGO workers in Indonesia cannot be contained within the narrow confines of managerial functions, but rather encompasses much broader social, civil and geopolitical concerns. The management literature on organisational effectiveness remains inadequate in its explanation of the strong ideological and political motivators uncovered here. Studies of local nonprofit organisations (NPOs) and grassroots associations (GAs) of North American origin have included discussions of the political nature of nonprofit organisations (Smith, 1999a, 1999b; Campbell, 2002; Jackson, 1999, Kaplan 2001), thus providing glimpses into the potentially anarchical world of emergent, social constructionist approaches of effectiveness. The intensity of feelings shown by the Indonesian NGOs toward their work, toward their constituencies, and toward Western influences can only be explained using dimensions that allow for emotional involvement. Radical organization theory: sociological vs. managerial The term radical immediately comes to mind in describing how these NGO participants think, behave, operationalize their intellectual comprehension of effectiveness in the workplace, and react to stimuli in their environment. Yet, the word “radical” has many connotations. Several organisations in the study showed unique organisational structures: one showed contempt for traditional (Western) linear management models, presenting instead a circular, nonhierarchical, unorganised, non-flow organisational chart to explain its operations. Another attempted to amalgamate professional and volunteer staff, and a third organization 22 deconstructed its formal NGO status to that of an experimental community-based entity that has no counterpart in Western management terminology. The Indonesian NGO focus groups had in common a desire to create a social movement, which they acknowledged was antithetical to the power institutions that controlled the country’s political and economic life. Almost all held combative attitudes toward government, donor and multilateral financial and corporate interests. Their chosen language of action suggested agitation rather than appeasement: to seek, to proclaim, and to empower in the struggle for sovereignty of personal and civil rights, sovereignty of civil society, sovereignty of culture and sovereignty of the economy. Several NGOs agreed that relations with certain government departments were adversarial and confrontational. They portrayed themselves as grassrootsderived, people-based nongovernmental organisations run by poorly paid staff or volunteers working around the clock to help economically and politically marginalized members of their society. If management is the study of how people in organisations utilize material resources such as human resources, time, money and things to accomplish organisational objectives, then the study of the management of these NGOs is anything but the study of the utilization of tangible resources in pursuit of organisational objectives. Are OE and radical organisational theory compatible? Transferring the Western management construct of organisational The effectiveness to a uniquely different society raises a number of questions. historical roots of organization theory have justified organisations as extensions of society, their organisational formats derived from religious beliefs, power and status (Clegg 1989; Hinings and Greenwood 2002; Mills 1998, 2002). Over time, this has 23 led to higher levels of efficiency in the production of goods and services, the development of the bureaucracy, and the emergence of a managerial class. Yet grassroots NGOs in Indonesia are the antithesis of bureaucracy. They are fighting the advent of private enterprise, whose sole motive they believe is personal profit at the expense of community. A number of participants expressed concern that they may become irrelevant in the face of the changing political and economic climate. However, the participants’ efforts to trace their historical roots, to internalize their organisational experience so that organisational objectives become personal objectives, and to focus their objectives on the geopolitical context in which they operate presents a creative new approach to understanding themselves that compares favorably to Rosengren’s observation that: . . . the historical perspective has grown ever stronger, a welcome complement to the sometimes rather one-sided, ahistorical perspective of the old behavioral and social science approaches (Rosengren,1993, p. 1.). This differentiated dimension also reflects Mills’ (1998) conceptualization of radical organisations as having emerged to compensate for the over-concentration on control and efficiency that characterized the 20th century. The participants’ expression of concern over the resultant lack of NGO autonomy and the massive bureaucracy that accompanies donor funding from international organisations which they ideologically spurn exemplifies such a position. The core issue here is the willingness or capability of NGOs to use enemy funding to pursue opposing valueladen organisational aims. Mills (1998) wrote that problems of radical organizing concern the issue of effectiveness versus co-option: 24 Repelled by the development of disciplines designed to manipulate humankind in the name of organisational efficiency and profitability . . . (Not only are there) alternative visions of organizing . . . but, often enough, (there are) organised ways of resisting. [For Mills, the more urgent question is] whether it is possible to resist and overcome existing discriminatory forms of organisations without replacing them with new forms of discriminatory organisations (Mills 1998, p. 285). Yet in the author’s view, social constructionist models and emergent theories of organisational effectiveness are similarly imprisoned in the rhetoric of described worlds, rather than worlds that are embedded in change. Though participants in this research were able to recognize, articulate and differentiate ideology from management operations, they failed to operationalize their six month plans, and except in one case, the participating NGOs were not able to implement appropriate management activities to meet their ideological objectives. According to Mills (1998, 2001), Hinings and Greenwood (2002), Clegg (1989) and Rosengren (1993), radical organisations are a reaction against the functionalism of management science, which is rooted in the practical, functional disciplines that seek ways of controlling and making more efficient the organization’s production of goods and services. The sociological and political roots of radical, social constructionist and humanist approaches to organisational theory have different origins. Their focus is on the societal consequences of organisations, and the dynamics of globalization, social movements, power and intellectual change. Hining and Greenwood (2002) believe that so complex is this discourse that perhaps such discussion is “best left to sociologists and political scientists outside business schools” (p. 3). 25 RELEVANCE AND UNIVERSALITY OF FINDINGS One may approach the question of the relevance of this research from many different points of view. Originally the author attempted to study the organisational effectiveness of five local grassroots NGOs in Indonesia through the eyes of those being investigated. However, in developing three intended themes of the management theories of OE, NPO management in a developing country framework, and management of NGO OE within an Indonesian context, the study findings have led the author to consider that the participating NGOs are unique organisations operating in a constantly changing geopolitical environment. This has led to new insights that describe this phenomenon from a radical organisational framework that eschews conventional, pragmatic, functional management orientations. This research has found that the way participants defined organisational effectiveness contains similar aspects to generally understood concepts of effectiveness in FPO modeling such as financial control and resource utilization. In addition, Indonesian NGO responses to the construct are similar in many ways to the responses of their Western NPO counterparts including mission awareness and attachment to their constituency. Yet there are other aspects such as radical politicizing that are unique and context dependent. While similarities of responses among the participants generally outweighed differences, there was considerable diversity among the responses and reactions of core participants and groups of stakeholders to specific issues, among them interpretations of transparency, internal assessments, government-donor-business relations, and gender issues. The variations in responses among the five participating NGOs show that each of the NGOs may be facing unique challenges, 26 and therefore it may not be prudent to generalize findings, especially with so small a sample population. On the surface, the NGOs participating in this study seemed remarkably similar: cultural background, geographic proximity to one another, size, educational and economic backgrounds of the principals, etc. However, on closer inspection, there were also significant differences such as constituencies served (e.g., urban poor women vs. forest product gatherers); services rendered (micro enterprise lending vs. farmers’ rights advocacy); organisational format (foundation vs. cooperative), extent of physical assets (quality of computers, furnishings and communications technology); stage in organisational life cycle, and origin of sources of operating funds (membership fees vs. donor grants). Moreover, there seemed to be a dichotomy of responses along gender lines, with the two female-dominated organisations welcoming government and donor participation and whose funds were derived primarily from external funding sources, including gifts from foundations, businesses, individuals and donor project funding. The male-dominated organisations focused more on developing political discourse and organizing communities at village level in rural areas, as well as providing vocational and technical training in forestry and agricultural production technologies. Their relations with the private sector (i.e. established timber and fertilizer companies) and government forestry and agriculture departments were described as tense and adversarial. Funding for operations came from membership dues and donor-assisted funding for participant training and projects. The absence of the delivery of measurable, tangible assets; a client base of disaffected, marginalized beneficiaries who cannot pay for services received; a lack of material inputs with which to generate and allocate material resources; political strength and ideological bases rather than a profit-margin rationale; and personal 27 investiture of time and volunteerism made it impossible to assess NGOs using such standards such as Llewellyn’s (2002) eight-element OE framework or Kaplan’s (2001) balanced scorecard. The findings indicated participants believed their primary geopolitical concern to be the often adversarial and competing philosophical and ideological conflicts with government and donors, and sometimes with other NGOs. Many of the donor- sponsored projects were not compatible with individual NGO visions, missions or general political ideologies. A difficult and complex operating environment exists in Indonesia whereby legitimate NGOs, counterfeit NGOs, local and national government agencies, aid donors and local communities are forced to confront and compete with one another on a daily basis for a voice in decision-making and the spoils that accompany empowered decisions. Understanding this contextual framework helps to understand how and why participants define and operationalize organisational effectiveness in the way they do. The literature on radical organisations (Clegg 1989, Hinings and Greenwood 2002, Mills 1998, 2002, Rosengren 1993) is replete with examples of similar working environments whereby NGOs in similar Third World countries feel equally oppressed and frustrated, their programmatic efforts to alleviate suffering at grassroots level compromised by lack of resources and ideological conflicts with donors, government and other organisations in their working environment. It is not surprising that within such a context the concept of organisational effectiveness does not fully align with its counterpart in other environments. What is surprising is the degree of alignment that does occur in that approximately one third of the discussion about the concept related to typical FPO concerns such as financial and resource accountability, helped along by donor agency requirements for regular financial reporting albeit taken on reluctantly by the managerial staff. 28 Reports from capacity building Indonesian grassroots NGOs in this study indicate they define, develop, rationalize, operationalize, analyze and evaluate organisational effectiveness within their organisations in ways that both converge and diverge from Western derived literature. When compared and contrasted to findings uncovered in other locations, the data from this research showed that the majority of participants understood the principles of effective management and were able to articulate and implement several management practices that replicated those undertaken by most Western located counterparts. Nevertheless, their strong political ideology resulted in development of alternative NGO management practices such as loosely defined authority structures, freely defined task responsibilities, and active political efforts that are inadequately explained in the traditional management literature and appear to be localized. Understanding OE and activities undertaken toward its implementation were thus inexplicably interwoven with the context of Indonesia, the purpose of the NGO, and the timing of the data collection. Indonesia remains deeply rooted in historical, cultural, social, political and economic traditions that do not lend themselves to easy transformation into organisational ideologies and activities compatible with current Western thinking and practices (Mann 1998). Neither the understanding of OE nor its measurement can be separated from the setting in which data is collected. In common with similar other constructs such as excellence or mediocrity, its meaning is a function of who is judging, when they are judging, where they are judging and how they are judging. (go to next page) 29 CONCLUSION More so than their Western NPO counterparts, Indonesian participants’ perceptions of effectiveness were a reflection of the dominant role played by political issues within the surrounding community and in their own lives, including the development of criteria and values that described efforts to mobilize, advocate, influence and affect societal change. Yet there were significant disagreements among participants regarding appropriate organisational practices. Often, the grassroots NGOs appeared to be pulling in opposite directions. Those NGOs engaged in primarily striving to provide tangible services appeared to be moving towards more conservative conventional management structures that focus on structure, operating procedures and fiscal and program assessments. However, other NGOs engaged primarily in community mobilization were moving toward more radical structures and processes. In light of these findings, models of OE generated from data derived from developed economies may need to be revised to include context-specific political ideology if they are to be applied to nonprofit organisations in different contexts. 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