No organization can exist in a vacuum; each is set in a particular country and region to which it is inextricably linked. This setting provides multiple contexts that influence how the organization operates and how and what it produces. Thus, the concept of "external environment" is an important consideration for IDRC as it attempts to understand the research institutions it supports. An analysis of the external environment is an attempt to understand the forces outside organizational boundaries that are helping to shape the organization.
Forces outside the institution's walls clearly have considerable bearing on that which transpires within. The external environment can provide both facilitating and inhibiting influences on organizational performance. Multiple influences in the immediate or proximal environment form the boundaries within which an organization is able to function; these influences likewise shape how the organization defines itself and how it articulates what is good and appropriate to achieve.
Key dimensions of the environment that bear on the institution include the administrative/legal, technological, political, economic, and social and cultural contexts, the demands and needs of external clients and stakeholders, and relations with other pertinent institutions. Some examples of environmental considerations that will be important to IDRC when profiling an institution are detailed below.
The administrative and legal environment in a country provide a framework within which an organization operates. In some countries this environment is very restrictive and has significant impact on all aspects of the organization; in other countries the administrative/legal context is more permissive. Understanding the administrative/legal environment is essential to determining if organizational change can take place. The administrative context within which the organization operates may be shaped by a unique combination of forces, including international, governmental, nongovernmental policy, legislative, regulatory, and legal frameworks. An organization is affected by the policy or regulatory context that gave rise to it. This includes specific laws and regulations that support or inhibit the institution's development.
Several specific dimensions of the administrative environment should be examined:
Both the types and the level of technology in the society give insight into understanding an institution. Institutions dealing with Western paradigms are dependent on the state of national infrastructure, e.g. power, water, transport; those which concentrate on indigenous research paradigms may have totally different dependencies. Thus, it is important to understand the level of relevant technology in the institutional context and whether such technology is defined by computer literacy or by highly developed indigenous methods of verbal and nonverbal communication. It might also be helpful for an assessment to include a consideration of the process by which new technology comes into use, both to understand how difficult it is to acquire needed research technologies and to develop an appreciation for the society's willingness to embrace both new knowledge and change.
At a general level, IDRC needs to understand the relationship between governmental strategy or development plans and the institution. Several specific dimensions of the political context should be scrutinized:
In the economic environment, the organizational analysis should centre on those aspects of the economic system that directly impact the type of project being considered. For example, inflation, labour laws, and opportunity costs for researchers in public institutions directly impact organizational activities. Clearly, a country under a structural adjustment regime or one that is expecting to undergo restructuring presents an investment context that IDRC needs to understand. Countries with foreign currency restrictions represent different environments for institutions than countries without them, for such restrictions have ramifications for research, e.g. for equipment procurement and maintenance. It is important for IDRC to know how the organization the Centre is supporting is affected by these and other economic forces.
Social and cultural forces at local, national, and often regional levels have profound influence on the way organizations conduct their work and on what they value in terms of outcomes and effects. For example, the mores of an indigenous culture have a bearing on the work ethic and on the way in which people relate to one another. Undoubtedly, the most profound cultural dimension is language. The extent to which organizational members can participate in the discourse of the major scientific language will determine the extent to which research efforts focus inwardly or contribute to regional and global research agendas. Understanding the national/regional/local values toward learning and research provides insight into the type and nature of research that is valued. For example, what is the relative priority placed on contract research in partnership with local clients, e.g. testing products and procedures with indigenous populations, as opposed to sharing information with academic peers internationally, or generating biostatistical data that will shape national or regional policy? Arriving at these priorities involves culture-based decisions.
Although research institutions tend to be driven by the research mission and the process of achieving it, all institutions are dependent for their survival on various groups of stakeholders. The stakeholder environment consists of those people and organizations external to the research institution who are directly concerned with the organization and its performance. Examples of stakeholders are suppliers, clients, sponsors, donors, potential target groups, and other institutions doing similar or complementary work. An organizational analysis seeks to learn the identity of these groups in order to assess their potential impact on the organization. Because of its international interdependent dimension, contemporary research relies on institutional relationships, and these need to be understood. Thus formal and de facto relationships with universities, government departments and agencies and other research institutions both within and outside the country need to be understood.
Influences from these multiple environmental contexts can become major facilitating or constricting forces on the institution as it works to accomplish its mission. In the extreme, these forces can keep an institution alive artificially; conversely, they can thwart organizational survival.
For IDRC to make effective investments in institutions, it needs a full and fair understanding of the organizational milieu and its bearing on organizational functioning. Only in this way can IDRC help support organizational efforts to overcome elements in the environment that may be impeding organizational performance.
The preceding section suggested a range of considerations for attempting to reach an understanding of the external environment. However, it is plain that the amount of data one could gather is enormous. In order to focus the environmental scan, organizational assessments tend to gather data around four basic questions that cut across various components of the external environment:
The major categories of forces described in the previous section need to be integrated into some sort of environmental profile. This profile can take various forms, but whatever form it takes, the profile should identify and characterize the main forces acting on the organization.
How stable are the social, political, and economic forces in the institution's immediate environment? A variety of factors can make the external environment unstable, therefore affecting the quality of organizational performance and the type of investment that IDRC might want to make.
Clearly, the more hostile the external environment, the more the institution needs to respond to it, the more difficult it is to carry out work, and the more defensive the institution must become. A government that withholds funds, bureaucrats who prevent equipment from being imported, an IMF regime that reduces the purchasing power of staff each of these environmental factors directly affects the organization and should be factored in the assessment.
Institutional resilience essentially relies on the autonomy of the institution within its environment. How dependent are the programs on external events and stimuli? Some institutions exist in complex environments in which their autonomy is subject to many forces, while others are less vulnerable. The more externally dependent or reliant an institution is for its programs, services, and performance, the more sophisticated and capable it must be about managing the external environment.
The institution's reputation is a major defense against such external forces. IDRC should understand the perceptions of reputation held by the major stakeholders. Groups such as the research community, government legislators, government bureaucrats, and granting agencies all have perceptions of the research institution and its outputs. Each group has different criteria and influence, and these diverse "influencers" all contribute to the organization's reputation. Obviously, the stronger the organization's reputation and the more broadly based its support, the more resilient the organization will be regarding threats of all kinds, including reduction in financial support.
|Exhibit 3.1: Questions typically asked about the environment.|
The following are key issues to consider within each of the institution's important environments.
The policy environment: What, specifically, characterizes the country's policy environment in this field, e.g. education, science/technology? Is an appropriate level of support given to the sector? Does the institution have a focused national role and function and links to national or sectoral programs?
The legislative system: To what extent is the country's legislative system stable and functional? Do the laws that govern relationships function rationally, and is conflict arbitrated in a reasonable way, freeing individuals from extreme corruption or conflict? What are the wage laws and salary structures which directly affect the institution? For example, are university salaries tied to teacher or civil servant salaries? Do wage rates differ significantly between public organizations and private organizations?
Is the technology needed to carry out the organization's work supported by systems in the wider environment, e.g. maintenance systems?
What is the process by which new technology comes into use in the society? Does this make it difficult to acquire needed research technologies? Does it hinder the ability of the society to adopt the results of research?
Overall, what is the value placed on research by the nation? Specifically, do national authorities support the institution through large-scale support (such as operating funds)? Are decisions about allocations heavily political?
The political bureaucracy: To what extent are government bureaucrats able to carry out decisions? On what basis are resource allocations made? Does the bureaucracy facilitate or retard the development of the organization? For instance, are the rules governing the institution so stringent that donor participation is made difficult or impossible? (For example, must money from outside the country be administered through the country's External Affairs Department rather than go directly to the institution? Does the country serve as gatekeeper of technology, inhibiting the transfer of equipment from one country to another?)
The history and amount of IDRC support and the goals of this support: What is the amount and nature of other donor support: Who, external to the country, is investing in the country, in this type of institution? Is there potential for coalitions or joint funding of projects by donors? Why has IDRC chosen to support this institution? What is the present mode of IDRC intervention: (project support, multiple projects, other)? Why was this mode of intervention chosen? What are the goals of IDRC support?
Do cultural values support the free intellectual exchange of ideas? Are they positive towards the value of the area of study and the work produced by the institution, for example, scientific knowledge? Information pertinent to women's studies? Are the country's human resources adequate to support the institution's work, e.g. qualities of the labour pool, demographic trends?
Do each of the institution's stakeholders have an interest in expecting/demanding that the research institution make satisfactory progress in carrying out its mission? Do strategic decision makers in the organization understand the specific demands that each stakeholder group is making on the organization? Awareness of the market segments served and the products/services produced to serve them comprises a "reality test" for the organization.
Does the organization adequately attempt to understand other organizations in the environment (local, regional, national, international) with a bearing on its niche? For example, what is the potential for losing employees to similar organizations offering better salaries? The potential for constructive collaborations and other partnerships that might enhance output? Are adequate networks and systems in place linking this organization to other organizations so as to enhance/support research or training products/services?
Obviously, the external environment within which institutions operate is large and complex, and culling data from this environment requires the ability to separate the important from the less important. It is critical that the organizational assessment capture the impact that the environment is having on the motivation, performance, and capacity of the organization.
The first place to search for pertinent data is an existing "environmental scan" of the organization that may have been carried out by the organization itself. As part of strategic planning, it is common nowadays for organizations themselves to undertake environmental scans. If a recent scan has been carried out, this will be of great assistance. If not, the evaluators must attempt to identify, with the assistance of key organizational members, the external factors (e.g. social, political, economic) that are most supportive as well as most troubling to the organization. These factors will form the starting point for discussion and analysis.
|Exhibit 3.2: Methods of gathering envrionmental data.|
Both performance and capacity are heavily influenced by the external environment.
Performance is contextual, for it is the values of key organizational stakeholders that determine the short-term and long-term reputation of the organization. For example, government officials who see little evidence of immediate impact might view the research institution quite differently than does the research community, which applies international scientific norms as their referent. Local community residents might regard the institution as a helpful resource, but the scientific community of the country or region might find its work out-of-date. Understanding the external environment therefore helps to contextualize the understanding of performance.
With regard to capacity and its development, the institution's context is an intervening variable in many management choices. For instance, the usefulness of a particular organizational strategy or structure can be directly influenced by the organization's external environment. The extent to which resources are available is influenced by the external environment, as are the internal policies and procedures deployed by an organization to control these resources. The nature and type of interinstitutional linkages are similarly affected by the environment. Ultimately, the external environment influences the choices an organization makes regarding its programs, types of outputs, and the standards of judgment that are appropriate and acceptable by which to measure its progress in fulfilling its mission.