Institutional Development

A friend asked me to answer some questions to help him write an essay for his MSc in Development Management, “Why should development managers attempt to bring about institutional development?”  It’s quite likely I haven’t got a clue about institutional development but my response is below and he seems happy with it.  He will combine my reply with others and consider them for  part of  his essay.

The reason I’m reproducing my reply here is because I think it is relevant to the thread I’m writing about the nature of third sector organisations.  Whilst in my answer I refer to large organisations, perhaps it equally applies to small organisations that become bureaucratic.  What happens when small young organisations become institutionalised?

The headings are his questions:

1. What is an institution?

An organisation that is designed to be sustainable.  This means its continuation is not dependent on its leaders in the sense that when they leave there are always people available to step into their shoes.  This implies a high degree of bureaucracy.  The continuation of the organisation takes precedence over staff and clients’ needs.  Check out HMRC’s telephone helpline service if you don’t know what I mean.

2.  What is institutional development?

The big headache in institutional development is changing organisational culture.  It will tend to be highly stable and difficult to change.  I worked for an institution that had a complete change in top management at the same time.  Six managers left (were slung out actually) and were replaced by four new managers with new job descriptions.  This made no difference whatsoever to the institution and the new managers soon behaved in similar ways to the old ones.

3. What is the purpose of institutional development?

This rather depends on what you want to achieve.  A business may need to respond to its markets and can lose its way if the market changes and the institution can’t change with it.  HMV is an example of a business that had difficulty adapting to downloadable music and videos.  HMRC on the other hand does not need to change the way it does things as we’ll always need taxes.

4.  What activities does ‘doing’ institutional development involve?

Banging your head against a brick wall!  You’re not going to see rapid change.  Effective actions might take a long time to take effect and if the long time is longer than the lifespan of the person leading the change, then the policy might change before the previous policy had an effect.  Any proposed change is likely to be resisted.  Superficial changes can go through because they don’t touch the culture of the institution.

5.  What management skills does institutional development require?

Listening – to staff and especially junior staff rather than managers.  Many junior staff are likely to have been around for a long time and they understand how things work.  Many will have been around longer and understand more than the managers.

Listening to customers or clients – complaints and complements can be helpful and where appropriate good complaints procedures can help.  But also in-depth interviews with typical customers or clients might help.

Patience – it will be slow work!

So, what do you think?  Can small young organisations become institutionalised?

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About the Author

I've been a community development worker since the early 1980s in Tyneside, Teesside and South Yorkshire. I've also worked nationally for the Methodist Church for eight years supporting community projects through the church's grants programme. These days I am developing an online community development practice combining non-directive consultancy, strategic management, participatory methods and development work online and offline. If you're interested contact me for a free consultation.

Leave a Reply 2 comments

Mark Woodhead - December 8, 2014 Reply

I am not familiar with the expression ‘institutional development’, but it is probably quite closely related to organisational development. From what I have learned about organisational development, a key thing is to be able to take a constructive attitude and to learn from successes and from failures/mistakes, especially perhaps to learn from mistakes, which is not always easy. Faced by a mistake, instead of having a default position ./knee-jerk reaction of ‘who can we blame, who can we scapegoat for this?’ we need a reaction of, as Robert Chambers put it, ‘we’ve made a mistake. Good. What can we learn from it?’

If we fail to make this shift from a scapegoating response to a learning/organisation development response, organisational weaknesses are likely to remain untackled and even unacknowledged.

On a rather different matter, I’m not sure I agree with the comment about HMRC. Yes, in life two things are certain, death and taxes; but even so, I think HMRC does need to change, in response to the very high levels of tax evasion and tax avoidance, by wealthy individuals and companies, and especially by transnational corporations using elaborate schemes thought up for them by big accountancy firms, and making use of tax havens such as Luxembourg.

Chris - December 9, 2014 Reply

I think the big difference between institutional and organisational development is that institutions will have a bureaucratic response to a mistake. Whilst institutions will learn over time it is slower because its responses are set in numerous implicit and explicit codes. To some degree they are future proofed. Almost anyone can occupy any role so long as they have the instructions and understand them. Blame will be for those who break the rules, not for those who make a mistake. Whilst I agree your response is desirable, the question is whether it is practical in this type of organisation.

My first reference to HMRC was to their telephone answering service and I think I still had this in mind at the second mention. The changes you mention are essential and I would argue all these issues raise questions about whether HMRC is fit for purpose. My more modest point is they will never improve their telephone service because they have no incentive to do so.

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