MIT OpenCourseWare
http://ocw.mit.edu
11.235 Analyzing Projects and Organizations
Spring 2008
For information about citing these materials or our Terms of Use, visit: http://ocw.mit.edu/terms.
11.235 Analyzing Projects and Organizations
Spring 2008
Assignment 2
This paper is divided into three parts: First, it presents the way that external and internal
environments influence the behavior and policies of organizations. Then, it looks into more
detail at one type of projects that organizations carry out, namely pro-poor development
programs, and analyzes the micro-politics of such endeavors. Finally, the paper re-evaluates preconceived obstacles of failure for project implementation and service delivery to understand how
commonly held “weaknesses” have actually led to more efficient or equitable outcomes.
1) Navigating External and Internal Environments
Previous research has shown that looking at the internal and external context of
organizations is critical to understand managers and administrators’ decisions related to resource
distribution and projects and activities that firms or public agencies will undertake. Pfeffer and
Salancik (1978) assign an interesting role to managers and administrators as basically negotiators
or, in my own words, navigators, of internal and external environmental constraints, who attempt
to meet the demands of different constituencies. Weiss’ research (1987) on school districts in the
US demonstrates how the decision of schools districts to cooperate with each other is determined
by external demands for agency performance -- the main driver -- , by the recognition of an
internal and common perceived problem by all districts, and by the availability of internal and
external resources of districts and the institutional capacity for cooperation. Local officials and
district superintendents basically weigh all these variables and decide whether they should
cooperate or not. They need to analyze accurately and with clarity the external demands of
parents, school boards, and internal demands from teachers and educators on their district.
This is for me rather different from the view I held of managers as visionary powerful
leaders with clear long-term goals and strategies: in reality, managers try to process internal
demands from their staff and, on the other side, understand accurately external demands and how
to respond to them. In this sense, the view I had of a manager always looking at the future and
Isabelle Anguelovski, student paper for 11.235, Analyzing Projects and Organizations, Spring 2008.
MIT OpenCourseWare (http://ocw.mit.edu/), Massachusetts Institute of Technology.
1
11.235 Analyzing Projects and Organizations
Spring 2008
Assignment 2
forecasting the best strategies for the highest return on investment, for example, is overshadowed
by the view a manager just trying to create meaning of past actions and see how she/he can learn
from past mistakes to best accommodate the environment.
The role of managers and administrators is even more complex because essential
information is not always easily accessible to make decisions. They might have to divert a lot of
time and resources to seek this useful information and then decide which piece of information to
consider to match their personal, staff, and organizational interests. The case of the East Asian
Miracle study (Wade, 1996) shows how heads of the World Bank (WB) asked for the production
of a report on economic growth in South East Asia and used its findings to support growth
policies in line with the United States’ priorities. No matter what the “scientific truth” might
have been, WB officials gave priority to the findings of neo-liberal economists who lacked field
knowledge of East Asian countries over the local knowledge of journalists or Asian bureaucrats
because they needed information that responded to their internal and external constraints – the
WB staff, the main donor (the United States), and its borrowers. This paper also gives an
illuminating micro-perspective on how internal power relations and the battle over ideas and
discourses among different actors within an organization, here the United States and Japan as
financial contributors to the WB, framed the priority policies and discourses of an organization
to the outside. A more in-depth look at the politics of decision-making within the WB also
reveals different layers of power within the Bank (the Board, the Vice Presidencies, and the
street level bureaucrats who do or do not have influence).
The external and internal environment that constrains the behavior of organizations might
take the form of common paradigms and discourses (Ramsany, 2006). In his analysis of the
agenda change in the World Bank urban policy programs, Ramsany shows the power of ecopolitical and intellectual trends within and outside the Bank that have shifted the priorities in the
Isabelle Anguelovski, student paper for 11.235, Analyzing Projects and Organizations, Spring 2008.
MIT OpenCourseWare (http://ocw.mit.edu/), Massachusetts Institute of Technology.
2
11.235 Analyzing Projects and Organizations
Spring 2008
Assignment 2
1980s and 1990s away from poverty alleviation through direct investment in basic infrastructure
and housing for low-income residents towards capacity-building and financial reform, reflecting
the larger domination of discourses of fiscally conservative policies, structural adjustment, and
governance. This paper helps understand the importance of discourses and ideas in organizations,
how they get communicated internally and externally, and how a shift in ideas and paradigms
leads to shifts of power, organizational change, and priority setting within the organization. For
example, the change of priority in the WB urban policy led managers to split the urban
Department into separate "projects" and "policy" divisions, with the former falling under the
leadership of the vice-president for policy planning and research. This change disempowered the
“urban” staff and created conflicts between planners and economists. Furthermore, this paper
provides new original insights for me about different components of external environments –
from media (Forbes), think tanks (the Heritage Foundation), and outside leaders (Thatcher and
Reagan), all agents of paradigm shifts within an organization.
A type of group in the external environment of public agencies that requires special
attention from administrators are organized interest groups constantly working to shape policies
and obtain resources from an agency: as Kaufman (2004) shows in his study of urban
development in the US, fiscal policies have been influenced by the power of organized interest
groups (i.e. business groups) and the competition between them. Those groups will lobby for
policies that provide them with “positive” rents and fight against policies that will provide their
competitors with comparable benefits. In another example taken from Andhra Pradesh, India,
local political dynamics have affected the lack capacity of primary health centers to give
treatment to poor tribal patients. The competition between parties, authorities representing
different tribal groups, health officials, and doctors’ associations have prevented high quality and
equitable health services delivery (Gopinathreddy, Jayalakshmi, and Goetz, 2006).
Isabelle Anguelovski, student paper for 11.235, Analyzing Projects and Organizations, Spring 2008.
MIT OpenCourseWare (http://ocw.mit.edu/), Massachusetts Institute of Technology.
3
11.235 Analyzing Projects and Organizations
Spring 2008
Assignment 2
2) Micro-Politics of Aid and Service Delivery to the Poor
The second emphasis of the readings concerns aid and service delivery for the poor and
the politics, mechanisms, frameworks, and actors involved in such a process.
The poor are typically unorganized and offer few resources to parties other than a
promise to grant legitimacy to newly elected officials. My previous views on how reforms
benefitting the poor get implemented were limited to either a) the capacity of a strong social
movement to push for change and dismantle the power of authoritarian elites, such as the
Mexican Revolution of 1917, or on the other side, b) the capacity of enlightened autonomous
leaders in powerful public positions to impose changes benefiting the lower classes of society.
However, in some cases, officials and bureaucrats have managed to implement new reforms for
the benefits of the poor while empowering them politically and organizing them as a unified
political and social force that could support the reforms. In the Politics of Food in Mexico, Fox
(1993) presents the initiative of young team of agrarian reformers who attempted to make farmer
producers the core beneficiaries of state subsidies in seeds, credit, or technical assistance while
extending the state food distribution network to rural areas. These reformers fought against the
opposition from agricultural bureaucrats who wanted to distribute all subsidies to large farms in
irrigated areas and successfully organized the farmer beneficiaries through community food
councils. Those councils used official regulations, shrewdly drafted by the reformers, to hold
DICONSA (the food distribution agency) accountable for delivering food to rural stores
available for farmers at subsidized prices. This case shows how dynamics played out in
organizations in favor or against a policy and how autonomous reformers in Ministries and social
movements combined forces in a coalition to push for a reform.
Another mechanism for aid and service delivery to the poor is related to alliances or
contracts between NGOs and the State, which emphasizes how dependent they both are on each
Isabelle Anguelovski, student paper for 11.235, Analyzing Projects and Organizations, Spring 2008.
MIT OpenCourseWare (http://ocw.mit.edu/), Massachusetts Institute of Technology.
4
11.235 Analyzing Projects and Organizations
Spring 2008
Assignment 2
other (Cammett, 2008; Smith and Lipsky 1993). Lipsky and Smith (1993) show how partnership
and contracting between NGOs and the State might bring beneficiaries closer to the service
providers. However, in my experience, this improved service delivery puts at stake the
independence of NGOs vis à vis the State and might decrease, on the other side, the credibility of
state agencies to deliver social services. Partnerships bring both constraints and opportunities.
Partnership reveals the tension between a government agency trying to spread its scarce
resources and ensure accountability and, on the other side, the need for NGOs to ensure regular
and constant cash flow. Problematically, this resource scarcity also forces NGOs to sometimes
adapt their program to governments’ guidelines and then renounce to their original mission, and
“betray” the priorities of their constituency. When I evaluated grant proposals in 2006 submitted
by community organizations offering after-school programs to the City of Boston’s Community
Development Block Grants (CDBG), it was clear that NGOs such as Roslindale Community
Center Council or Federated Dorchester Neighborhood Homes had strong ties in the community
and solid experience in the delivery of educational, physical, emotional, and social development
opportunities for local kids. However, these small NGOs were counting on the CDBG funds to
cover the majority of their expenses and had adapted their proposal focus to “fit” the 2006
CDBG priority goal -- to help families get out of poverty --, which was quite remote from their
mission of after school program and potentially in conflict with their founding mission.
In the area of development projects, Easterly (2002) and Ramsany (2006) show even
more clearly how donor agencies influence and define priority goals and strategies for
development projects in developing countries, alluding to the fact that the idea of “partnership”
is mostly a lure. This perspective is quite different from what Smith and Lipsky (1993) describe
about the construction of alliances between service providers and funders. The fact that
developing countries must adhere to strict reporting guidelines or prepare complex participatory
Isabelle Anguelovski, student paper for 11.235, Analyzing Projects and Organizations, Spring 2008.
MIT OpenCourseWare (http://ocw.mit.edu/), Massachusetts Institute of Technology.
5
11.235 Analyzing Projects and Organizations
Spring 2008
Assignment 2
PRSPs for the World Bank and the IMF and that all donors have similar requirements that they
coordinate and streamline with each other, without the real possibility for recipient countries and
organizations to express their needs or exit this system, shows that the supposed partnership
between donors and recipients is mostly an illusion. What was revelatory for me in the Easterly
(2006) paper is that, as immoral as these claims of partnerships might be, the internal policies
and requirements that donor organizations develop in a coordinated way fit the organizational
priorities of these agencies, by diffusing the blame among agencies for development failure and
by making it easier for them to produce highly visible outputs in terms of loans and projects.
This might not be efficient from a development perspective, but it is a rationale behavior for
agencies trying to survive in a competitive environment and accumulate resources.
However, even though partnership is mostly a lure, developing countries are not totally
powerless and can resort to a wide variety of strategies to assert themselves in decisions over the
development of a project. Hirschman (1995) and Tendler (1975) show through an in-depth
analysis of the micro-politics of development projects that public agencies in developing
countries are very agile at negotiating projects that benefit local constituencies and maximize the
resources they can obtain from donors, which questions assumptions I held that developing
countries are entirely dependent on the decisions made by a few powerful individuals in remote
offices in Northern countries. Tendler (1975) shows that, in the design of $31.5 million highway
maintenance equipment loan for three States of Brazil, the borrower knew that the larger the
equipment list it put together, the better the chances for getting financing. The local industry did
not fight for the equipment to be produced locally because it was aware that such a project would
generate considerable local expenditure no matter how many local orders were lost to imports.
Using the Hiding Hand concept developed by Hirschman (1995), it is also easily conceivable
to think that recipient countries might use pseudo-imitation techniques and pseudo-
Isabelle Anguelovski, student paper for 11.235, Analyzing Projects and Organizations, Spring 2008.
MIT OpenCourseWare (http://ocw.mit.edu/), Massachusetts Institute of Technology.
6
11.235 Analyzing Projects and Organizations
Spring 2008
Assignment 2
comprehensive-program techniques to make projects appear less obstacle-ridden than they
effectively are and give the project planners the illusion that they understand more in depth
possible arising difficulties than they actually are and respond creatively to them. In fact, we can
then imagine that, if officials from the WB or IDB have full knowledge of potential difficulties
and uncertainties surrounding the implementation of a project, they would not commit financial
resources to it. In Peru, the Yanacocha Gold Mine project is partially owned by the World Bank
through the IFC (the International Finance Corporation). In its presentation of the financial
benefits from large scale goal extraction in the area, it is not certain that the Peruvian
government of Fujimori would have received backing up from the World Bank if it had
presented the full range of social and environmental risks coming from the project, especially
from nearby indigenous communities whose livelihoods and health have been impacted by the
mine. In 1999, Fujimori convinced the IFC to help finance the mine's expansion plans when the
debt crisis prevented Peru's borrowers to access capital markets, despite the fact that local
communities were becoming highly dissatisfied with the project.
3) Positive Outcomes of commonly-viewed “deficiencies” and “weaknesses”
A third focus of the readings is on positive outcomes for firms or public agencies’ products
or programs despite the presence of internal processes usually seen as obstacle to adequate and
efficient delivery of services, products and programs.
I used to think that competition demands or search for greater efficiency were the driving
forces leading to organizational change and that change motivated by just a search for legitimacy
was detrimental to an organizations’ success: In my views, organizations in the public and
private sector would imitate the structure of other similar organizations when they saw
competitors in their sector adopting a specific model that would increase their market share or
improve their service delivery. However, in some cases, organizations imitate others through
Isabelle Anguelovski, student paper for 11.235, Analyzing Projects and Organizations, Spring 2008.
MIT OpenCourseWare (http://ocw.mit.edu/), Massachusetts Institute of Technology.
7
11.235 Analyzing Projects and Organizations
Spring 2008
Assignment 2
isomorphic structures, not because of efficiency or competition demands, but because this
organizational change gives them legitimacy, visibility and stability, which is not something I
had really thought about. This might not be the most efficient decision in the short-term, but
might lead to a stronger and stable organization in the long term. Di Maggio and Powell (1991)
show that the increased bureaucratization of organizations is due to powerful forces such as laws,
uncertainty, culture, and norms that force organizations to privilege structural equivalence to
similar organizations. For example, in foreign aid policy, common selection mechanisms and
approval processes for aid recipients among multilateral donor agencies and the coordination of
efforts between agencies have enabled agencies to gain stronger long-term control over
developing countries and prevent recipients from finding alternative resources (Easterly, 2006).
In another aspect of organizational life, the use of myths, rituals, and ceremonies might
not be the best strategy for organizations from an efficiency standpoint, but it is a rational
decision in the sense that it enables them to achieve greater stability, build common trust and
reliability among staff members, and ensure long term survival. Meyer and Rowan (1991) show
that myths are important internally to keep the organization moving forward, maintain harmony
in the day-to-day operations, and reassure the external environment and somehow control it. For
example, through my experience at Oxfam America, I have witnessed many staff members in the
Boston office taking about the “myth of participation and empowered decision-making” for
Boston-based program officers, when, in reality, decision-making was highly hierarchical and
Deputy Directors had a strong indirect influence on the way day-to-day operations and
procedures. However, program officers in the regional official of OA in Peru took advantage of
this declared participatory vision for decision-making to make decisions about grant
disbursement that were not always in line with Oxfam International’s – the overarching lead
agency – priority goals, and found legitimacy in their decisions by invoking this participation
Isabelle Anguelovski, student paper for 11.235, Analyzing Projects and Organizations, Spring 2008.
MIT OpenCourseWare (http://ocw.mit.edu/), Massachusetts Institute of Technology.
8
11.235 Analyzing Projects and Organizations
Spring 2008
Assignment 2
discourse. For example, although gender was not a priority for Oxfam in 2001, program officers
in Lima dedicated a substantial amount of money to fund rural projects linked to women’s’
empowerment in indigenous communities in the Andes. To the outside, the myth of participation
also made Oxfam look as a bottom-up organization for donors eager to see the principle of
participation that Oxfam was claiming for all its programs also implemented internally.
The power of rituals is also strong when it helps address a crisis in an organization.
Pfeffer and Salancik (1978) show nicely that managers serve as symbol of an organization and of
its action: when a CEO fires a manager because things have gone poorly in the organization, this
exclusion acts as catharsis for the rest of the staff and communicates to the outside a feeling of
control over an organization. Easterly (2006) gives another example of the power of rituals when
showing that aid agencies privilege shiny showcase projects and visible international meetings
that the public can easily witness and that gives legitimacy to the organizations’ action.
Another commonly held weakness of organizations is the existence of redundancy and
overlap (Landau, 1969). Redundancy and overlap tend to be associated with wasted resources
and inefficient allocation of staff or money across the organization. However, Landau helps put
these two “deficiencies” in a different perspective by showing how redundancy helps minimize
risk, suppress error, increase reliability and adaptability, and, in public agencies in particular,
avoid that recipients of services fall through the crack. When I re-read the Maynard Moody
article (2003), I wondered whether the health worker decision to help patients more closely who
needed psychological help would have been possible if this worker hadn’t been back in his dayto-day responsibility by a colleague able to over other “easier” cases in the meantime. Overlap of
responsibilities might enable street level bureaucrats not to feel so stretched. As Pfeffer and
Salancik (1978) show, redundancy might allow for greater slack and help firms and public
agencies manage conflicting constraints and demands.
Isabelle Anguelovski, student paper for 11.235, Analyzing Projects and Organizations, Spring 2008.
MIT OpenCourseWare (http://ocw.mit.edu/), Massachusetts Institute of Technology.
9
11.235 Analyzing Projects and Organizations
Spring 2008
Assignment 2
A major commonly held deficiency of development projects or organizations is the
influence of clientelism, rent-seeking, and patronage systems on decision-making about
allocation of resources and projects. As Scott (1969), Grindle (2008), Kaufman (2004), and
Cammett (2008) point out, criticism against such systems have focused on the capture of public
resources by private groups who have a special relation with elected officials and managed to
attract resources, projects, or jobs for their group members against support. However, as Scott
(1969) and Cammett (2008) show, such political systems are able to reconcile competing ethnic
and particularistic claims and can cement societies, especially those with a high number of
vulnerable immigrants or several ethnic and racial minorities. Scott (1969) shows that machine
politics and inducements in early industrialized America was particularly compelling for
immigrants seeking quick help and community building. In poorer nations, because of lack of
government jobs, patronage is even more a stronger cement. In Lebanon, political parties deliver
food assistance programs along sectarian lines to their support communities, which provides
welfare support to fragile communities and helps strengthen internal ties (Cammett, 2008).
In poorer nations, machine politics plays an additional role of changing allegiances of
lower classes and raising their power in the political arena when farmers or workers are able to
demand cash and other inducements and are not constrained any longer by a servitude relation
with an hacendero or a factory. More generally, machine politics can help lift some communities
out of poverty and exclusion. In early industrialized America, the presence of mercantile and
industrial organizations has had a positive influence on public spending related to infrastructure
and street lighting in impoverished communities (Kaufman, 2004). In this case, rent seeking
benefited both local manufacturers, brokers, and retailers and excluded communities.
Another value of rent seeking and patronage systems is that public officials have the
capacity to bring in new staff and promote new policies, since these systems are usually more
Isabelle Anguelovski, student paper for 11.235, Analyzing Projects and Organizations, Spring 2008.
MIT OpenCourseWare (http://ocw.mit.edu/), Massachusetts Institute of Technology.
10
11.235 Analyzing Projects and Organizations
Spring 2008
Assignment 2
flexible and new policies can be implemented with loyal people dedicated to a leader. Grindle
(2008) shows how public officials in Latin America have put in place different types of
patronage jobs in Latin America to fulfill different policy objectives: technical and expert jobs,
jobs requiring specialized training, and jobs without any specific competence required.
Some authors emphasize a last type of commonly-held deficiency in project delivery:
take-over of responsibilities (Tendler, 1993) and fight/competition between agencies (Bunker
and Cohen, 1983; Smith and Lipsky, 1993). I used to hold the view that take-over meant loss of
information, delayed project delivery, and lack of learning possibility, but Tendler (1993) shows
how better performing agencies and dynamic managers in already existing agencies have
successfully taken over the responsibility of executing rural development projects, such as road
construction, in Northeast Brazil. They were supported by powerful governors eager to see the
projects move forward. They took advantage of the expertise of professionals who were flowing
between agencies and efficiently implemented projects that other agencies might have been
reluctant to implement. In this sense, competition between agencies might create a sense of pride
and commitment and a positive dynamic for faster project delivery. As Smith and Lispky (1993)
suggest in their study of NGO-State relations, competition for scarce resources and fragility of
the financial stability of nonprofit organizations motivate organizations to prove their capacity to
deliver services. Similarly, Bunker and Cohen (1983) show how competition between agencies
with a similar function and working on similar projects prevents corruption behavior and
enhance project delivery. Their examples of projects related to the development of the
Transamazonian Highway in Brazil also questions the conviction I had that physical remoteness
and distance of agencies from centers of powers are strong factors of corruption because the
central agency have less control over project implementation. In fact, here, the institutional
structure and checks and balances between executing agencies prevented corrupt behaviors.
Isabelle Anguelovski, student paper for 11.235, Analyzing Projects and Organizations, Spring 2008.
MIT OpenCourseWare (http://ocw.mit.edu/), Massachusetts Institute of Technology.
11