This paper is drawn from a field-based case study of the approach to planning and control and their environmental conditioners in the central offices of the Victorian Synod of the Uniting Church in Australia. Its analysis is informed by grounded theory methodology and this first of two papers develops an understanding of this organization’s context, structure, management processes and planning orientation. Key external and internal environmental drivers: a community oriented culture, a consultative bureaucracy, a compliance oriented accounting system and increasing pressures upon organizational resources are identified and examined. These are found to produce a reactive style of planning which is primarily short term and resources oriented. The implications of an apparent strategic planning vacuum in such a not-for-profit organization are considered.
Instead, be concerned above everything else with the Kingdom of God and with what he
requires of you, and he will provide you with all these other things. So do not worry about
tomorrow; it will have enough worries of its own. There is no need to add to the troubles
each day brings. (Matthew: Chap. 6, V. 33–34) Not-for-profit organizations constitute a major sector of most Western economies in terms of employment, income, expenditure, and contributed volunteer hours. The not-for-profit sector has a major social and economic impact in our societies today(Holder,1987;Drucker,1989) and yet it has been accorded relatively little attention in the accounting and management research literatures.
1 Contemporary management and accountability processes in church organizations have been subject to even less attention. Notable examples have been such studies as Odom and Boxx’s (1988).survey of planning processes employed by Southern Baptist Churches in the U.S.A.,Duncanet al.’s (1999) study of internal control systems in U.S. churches,
Laughlin ’s(1988,1990,1991) contextual research into the accounting systems of the Church ofEngland, and Booth’s (1993,1995) field research into the significance of accounting in the Uniting Church in Australia Synod of Queensland. Religious organizations still occupy a major social, economic and political role, even in capitalist and materialist western societies. In Australia for example, the
Christian churches exhibit attendance and membership growth rates that are con-
sistent with population growth (Kaldoret al.,1997), command the allegiance of a significant (albeit minority) proportion of the population, are active and highly visible participants in public debates over social and ethical policy issues, command significant property and investment assets, increasingly supply an enormous array of social welfare services often outsourced by government, and employ inestimable numbers of professionals and volunteers in service delivery throughout the Australian community. Drucker(1989) has argued that the not-for-profit sector is the U.S.A.’s largest employer and that even at the close of the 1980s, volunteer hours committed to not-for-profit organizations amounted to an equivalent of 10 million full time jobs annually. Religious not-for-profit organizations comprise a socially, politically and economically important sector that has been largely neglected by accounting and management researchers, particularly in terms of management planning and control systems employed, approaches to strategic decision-making and operational control, the management of a complex array of stakeholders, and the addressing of multiple objectives and strategic agendas. Yet arguably some of these dimensions
and characteristics represent significant differences from the profit sector organiza-
tions with which accounting and management researchers are all too familiar. The
religious organization often grapples with a wider remit of strategic objectives that
include a prime spiritual focus, a more diverse array of ‘owners’ and stakeholders
with often competing agendas, a more complex set of revenue sources, and more in-
tricate relationships between service providers and recipients (Ruckle,1993;Parker,1998;
Wheelen and Hunger,1998).This study therefore focuses upon an investigation of the context and shape of planning and control processes in the central offices of a large religious, not-for-profit organization—the Victorian Synod central offices of the Uniting Church inAustralia (VSC), with a view to identifying dimensions which distinguish them
from processes in private sector for-profit organizations. In this the first of two
papers appearing in MAR , the focus is upon understanding the nature and degree of
complexity of environmental factors driving the planning process, the fundamental
nature of the planning process observed, and its degree of apparent (in)formality,
flexibility and contingency. In an era when strategic management has become a
primary planning and control approach employed by private sector organizations,
this study offers an opportunity to evaluate the extent to which such mechanisms are
reflected in, and appropriate to not-for-profit organizations.
This study aims to address a lacunae in research based literature in planning and
control in religious organizations. It offers an in-depth examination of one such
organization, identifying the nature of its planning process and the key factors
conditioning it. In doing so it discovers a strategic planning vacuum which is filled
by a short-term oriented, reactive approach to planning. Aspects of the factors that
influence this outcome appear to be potentially unique to the religious organizationcontext. In addition, mirroring its complex structure and constituencies, this religious
organization’s experience raises the question of whether the absence of formal
strategic planning represents a weakness in the organization’s approach to fulfilling
its mission or a positive contingent strategy that facilitates its flexible response to a
dynamic and complex external environment. The field research tradition as defined by
Ferreira and Merchant (1992) is followed by this study which employs a grounded theory (GT) methodology as originally espoused by Glaser and Strauss(1967) and more recently by Strauss and Corbin(1990). This paper first outlines the methodology employed, then provides an overview of the VSC and its institutional context. The inductively derived theoretical framework of planning and control from the whole study is then introduced in order to provide the reader with a conceptual ‘map’ that will provide a template for the
discussion and analysis of constituent concepts and relationships that follow in the
two papers. Subsequently in this paper, two internal and two external environmental
factors that appear to be the major drivers of VSC planning and its shape are
explicated, followed by an exposition of the nature of the planning process observed.
Thus each of the sections devoted to ‘a community culture’, ‘resources pressure’,
‘the consultative bureaucracy’, ‘compliance oriented accounting information’ and
‘reactive planning’ constitute planning concepts inductively derived from and
grounded in the data observed and analysed from the field observations, interviews
and documents. They provide a blend of thick description and analytical reflection
and conceptualization entirely emergent from the field data. These concepts—their
characteristics and relationships, form the foundations for the planning and control
framework developed in this and the subsequent paper from this study. The planning
observations derived in this paper are then compared with some prior research on
planning processes in for-profit and not-for-profit organizations.
This study of the UCA VSC has identified and outlined a quite complex set of
external–internal influences upon this organization’s approach to planning. That
approach has been identified as reactive, being short-term oriented, resources
focused, and responding to environmental ‘crises’ as they become apparent and
pressing. Planning initiatives in such an organization appear capable of being
activated, intervened, diverted, modified or even blocked at various organizationalevels by a wide spectrum of different interest groups. The extent of consultation
across different committees and groups and the accompanying slowing of decision-
making speed both contribute to short-term planning that reacts to imminent or past
events rather than anticipating long-term projections or laying the foundations for
long-term strategic initiatives. The focus instead is upon attempting to meet and
maintain the short term capacity to meet the burgeoning welfare and other demands
for service to which the organization is philosophically and emotionally committed.
In some senses it is arguable that this approach to planning may not be as entirely
dysfunctional as a private sector corporate perspective might suggest. Yet this very
strategic planning vacuum may offer some not-for-profit organizations some space
and flexibility to assimilate and determine how best to respond to the myriad
of issues arising from a complex web of stakeholders with whom they interact.
Such informality and flexibility may denote a contingent approach to dealing with
environmental change.
The significance of this study’s findings then, reside in its identification of a
complex set of internal and external factors conditioning planning in a religious
organization. For such an organization, formal strategic planning may be absent,
supplanted by a short-term, reactive planning approach. This on one hand suggests
a weakness in management planning and control when compared with commercial
organizations, but on the other hand may denote a subtle and unique approach to
environmental buffering and offer a dynamic and flexible approach to coping with
environmental uncertainty. The questions that remain to be considered are what
form the reactive planning process takes in such a situation, whether any further
factors appear to influence the shape it takes, and what, if any, control processes are
employed as a result. These issues will be considered in the subsequent paper from
this study
