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Thursday March 28, 2024

What makes them successful?

By Foqia Sadiq Khan
December 31, 2019

How can a handful of organisations, working in both the public and private sectors, be successful amidst the sea of dysfunctionality around them? What makes some organizations successful and others failure?

These questions are asked in a book, ‘Candles in the Dark: Successful Organizations in Pakistan’s Weak Institutional Environment’, by Mahmood Ali Ayub and Syed Turab Hussain, which we refer to in this article.

The above-mentioned two authors in their book look at the case studies of nine successful organizations and also study two failing organizations. The successful organizations include LUMS, IBA, Motorway Police, BISP, NADRA, Punjab Education Foundation, The Edhi Foundation, Rescue 1122, and Shaukat Khanum Memorial Cancer Hospital. The failing organizations include PIA and Pakistan Railways. The authors draw their analysis of factors contributing to success and failure on the basis of their case studies, and also discuss the challenges and issues still faced even by the successful organizations.

According to the authors, some of the factors that have contributed to the success of the above-mentioned nine organizations include having clarity of objectives and goals, the ability to retain skilled staff, financial sustainability, continuity of leadership and its vision, ensuring autonomy of management functions and garnering political support, monitoring and evaluation, supporting role of development partners, and adaptability amongst others.

For example, in the case of Rescue 1122, its CEO Dr Rizwan Naseer implemented merit-based selection of staff. So did the Motorway Police. At LUMS, over 80 percent of the faculty holds doctoral degrees. IBA Karachi also provides clear benchmarks and guidelines for the selection of faculty.

The Punjab Education Foundation works on the principles of a ‘lean and efficient public-sector management’ and the bulk of its resources are spent on programmes (95 percent) instead of being consumed by administrative functions (only three percent) and little is spent on programme-related expenditures (only two percent). The Edhi Foundation does not take any funds from the government or international organizations and it insulates its functions from interference. It works on the basis of charity funding only.

Similarly, these successful organisations have strong top leadership and managerial autonomy. For example, NADRA’s head directly gets feedback from the middle management by cutting away the hierarchical structures. The Shaukat Khanum Memorial Cancer Hospital is also a highly reputed integrated healthcare facility that provides cancer treatment on a need basis and equips its healthcare professionals with the latest medical development training, and also carries out research.

It is possible to do so due to a decentralized management structure, amongst other factors contributing to success. The board of governors does not interfere in the day-to-day management and the CEO and various departmental heads manage routine functions. The management of the Punjab Education Foundation is also decentralized and vertically integrated.

The Rescue 1122 leadership also stressed upon the provincial government leadership that a professionally managed and well-performing rescue operation is going to be a better ‘political asset’ for the administration than a politicized and inefficient outfit, and the provincial government bought the idea and allocated the required funds for it. Rescue 1122 only has a few minutes’ response time to crises in the province and is well regarded for its service delivery.

Successful organizations also learn from their earlier mistakes and design flaws and improvise. BISP is a clear example of that. Notwithstanding the striking down of over 800,000 names of BISP beneficiaries that requires a dedicated analysis on its own, BISP moved poverty score-card based targeting in its Phase 2, having grown out of targeting through elected representatives in Phase 1. Similarly, disbursements of funds to BISP beneficiaries evolved from distribution through the Post Office to replaced with smart card, mobile phones, and finally debit cards.

Still, even these successful organizations face challenges that need to be addressed to make them even more effective. These challenges remain around sustainability, transition to future leadership, governance issues, excessively fast expansion, availability and retention of quality human resources, need for regular monitoring, and the need for institutionalization of policies, procedures, and processes rather than haphazard decision-making, amongst others.

In describing the story of failing organizations like PIA and Pakistan Railways, the authors point out political interference, overstaffing (for example, political interference in hiring has led to PIA having the highest number of employees per aircraft ratio in the world – 19,500 employees for 31 planes only), lack of autonomy, leadership issues, the negative role of trade unions, poor regulation, corruption, biased investment decisions (for example, in the case of the Railways investment was made in the roads network rather than improving the railways infrastructure), inefficient resource management, lack of planning, and financial mismanagement.

The authors have discussed the standardized political economy issues like political interference, corruption, management structures, and resource allocation decision-making in detail at places. However, there is also the need for a broad political economy analysis of these successful public and private-sector organizations. The elite in the country want islands of functionality amidst an oasis of dysfunctionality. That is why we see LUMS, IBA, Motorway Police (amongst others) perform well as organizations. Similarly, the social protection provided by BISP and good service delivered by Rescue 1122 make political sense in electoral democracy. NADRA is needed to enforce governmentality.

Having said that, the book is a very useful contribution to the literature on why some organisations are successful and others are failing in developing countries like Pakistan, and this debate needs to be extended both in its scope and breadth of empirical documentation.

The writer is an Islamabad-based social scientist.