Paucity management practices in Australian non-profit human services organisations. Wagner, R and Spence, N

The research investigated some internal functions of non-profit human services organisations in response to a decline in resources and increased pressure to perform efficiently.

This paper has been published with the kind permission of the authors and the Third Sector Review.

Reference: Wagner, R. and Spence, N (2003) Paucity management practices in Australian non-profit human services organisations Third Sector Review, 9 (1)119:135

Abstract

The research investigated some internal functions of non-profit human services organisations in response to a decline in resources and increased pressure to perform efficiently. The research builds on four (4) studies of paid staff members (n=170) of a combined hundred and fifty seven (n= 157) non-profit organisations in New South Wales. The key outcome was the development of a new analytical category to understand management practices, that is, 'paucity management', a set of strategies used by paid managers and workers to operate effectively and ethically under resource-poor conditions. Five common domains of organisational practices are proposed as initial core of paucity management.

Introduction

The changing nature of the welfare state and social service provision internationally and in Australia has been well documented (for example Billis and Harris (eds) 1996, Smith 1998, Earles 1999, Wagner et al. 2000). The arrival of an economic rationalist paradigm and the subsequent restructure of State responsibilities have been accompanied by the introduction of private sector managerialist agendas (Rees 1995) to non-profit organisations.

Current Australian government policy promotes transfer of social responsibilities to the non-profit and private sectors on a contractual basis (Earles 1997). The non-profit human services sector is the largest provider of community services in Australia, although the for-profit sector is growing at a faster rate. Since 1996, the non-profit sector grew by 10%; the for- profit sector grew by 32% and the number of government organisations stagnated (Australian Bureau of Statistics 2002). The out-sourcing of government services and introduction of competitive tendering is positioning non-profit organisations and their clients within an economic paradigm. Within this paradigm non-profit organisations have been transformed into service providers, clients into customers and user choice and competition, as the market forces, have impacted on access to and quality of services provided (Tesdorpf 1997). Micro-economic reforms have impacted on the responsibilities of paid and unpaid managers and are reflected in debates about appropriate managerial models (Rees 1995, Jackson and Donovan 1999, Lyons 1996 and 1997, Wagner et al. 2000).

Traditionally, the sector's managerial ability was seen as weak, in particular in small community based organisations (1-5 employees), governed by volunteer management committees. 'Management' in the context of this research is defined as all professional functions related to: policy development, planning and evaluation, human resources, financial and asset management, legal and compliance issues.
The roles and viability of volunteer management have formed a research focus in the past (e.g. Billis and Harris 1996, Lyons 1997). More recently, in line with economic and political changes, the sector has experimented with private sector strategies, but has experienced contradictions between private sector and community sector management such as outcomes based funding that assumes quantifiable outcomes, quality management measures that depend on 'product' definitions, and a focus on the economic bottom line.

A number of researchers argue that non-profit organisations need to change in response to the changing socio-political and economic climate of welfare provision in Australia (Steane1999, Mc Donald 1997, Jackson and Donovan 1999). Researchers and practitioners do not agree on how to change and what change is needed. Jackson and Donovan argue, for example, that agencies are:

" … faced, willingly or otherwise, with the need to come to terms with aspects of management that were not their concern in the past, and with financial constraints that are a recent development." (Jackson and Donovan 1999: viii)

Sectorial peak organisations, on the other hand, see the introduction of contracts instead of grants, competitive tendering where organisations have to bid for money and new outcome measures as highly controversial (Australian Council of Social Services 1997, Association of Childrens Welfare Services 1998).

By and large, the introduction of new systems has been promoted without exploring the benefits and disadvantages of the status quo of non-profit management sufficiently to develop a rational change management strategy. McDonald (1999:12) finds that the status quo is less then well understood and states that " [I] n reality, Australian non-profits, like their counterparts in other countries, are 'black boxes', the internal functioning of which is opaque." Research to date suggests that the adaptation to the new welfare regime is patchy (Liddell and Murphy 1999) and sector specific practices need further investigation (ibid).
In order to gain a better insight into the status quo of how non-profit human services organisations operate under the new regime, the researchers conducted four studies. Each study focuses on a different set of questions and internal functions including job satisfaction, staff morale and managerial responsibilities. Although each study is limited in scope, in combination their findings provide a range of new insights into the 'black box' of non-profit human services organisations. Their combined results led to the development of 'paucity management' as a new category (Wagner et al 2000:43) for the description and analysis of managerial practices in this sector.

"i ( I)ncluding personal and social support, financial and material assistance, job placement and support for persons with disabilities, child care, accommodation for the aged and other residential and non-residential care services."(Australian Bureau of Statistics 2001)

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