Case – A failed attempt to change management Controls in the Pakistani Civil Aviation Authority

(CAA) by a large international consulting firm.

The recommended business like management controls such as modern performance management
systems and state of the art info system that were rejected outright by the client management.

Focuses on the structural conditions facing both the client and the consultants, strategies adopted
by them.

Through structural and strategic analysis, this paper aims to enhance our understanding of the
dynamics of management consulting in public sector organisations, especially in emerging
economies.

Movement since early 1980s to bring a change in the PSO model of organizations, known as the New
Public Management or NPM. Crux of this reform is to make the management of the PSOs more
business like by bringing in aspects such as performance, efficiency tracking, cost control, auditing
and more. Government gave huge money to the management consultants during this reform period.

Intense political debate and industrial conflicts in emerging economies because of this.

Fincham – Categorizes management consulting into functional and critical.

Functional deals with the best practices of consulting interventions, on consultants, by C and for C.

Critical stream problematizes the taken for granted utility and importance of management
consulting and the role it plays in changing the management and accounting practices at the
organizational level.

Strategical or structural perspective, they are not mutually exclusive according to Fincham,

Structure influences agents occupying positions within the structure by giving them a vested interest
and powers. So, for example, any agent occupying the position of capitalist in a capitalistic economic
structure (the relationship between the position of capitalists, labour, the product market etc.) will
have a vested interest in making a profit.

What comes between structural conditions and the outcome is the moment of human agency.
Bhaskar and other scholars subscribing to his school of thought fully recognise the importance of
agency, i.e., the power of individuals to interpret and reflect on these structural pressures and take
actions that they deem appropriate, even against the structural pressures.

Critical realism, thus, insists on the analytical separation of the powers of structures and agency to
provide a better explanation of the social phenomenon; this is called analytical dualism.

Structural pressures such as position of the managers and other managers in higher positions,
explain the tendency on the part of the managers to hire consultants.
Similarly due to the economic structure pressure withing which the consultants are operating also
influence the consultant’s recommendation to the desired client management.

Methodologically, the foremost issues that require investigation are identifying the structures at
work and the interaction of these structures with the actions of agents (both consultants and
clients). These are further discussed in the following section.

Research questions –

What are the structural constraints faced by CAA?

What are the strategies employed by the management consultants?

How did the client managers (in this case CAA’s management) react to the consultants’ suggestions
on management accounting change?

How did the interactions between structural constraints and strategies influence the outcomes of
the consulting interventions?

Documents reviewed included historical documents on CAA; reports by Transparency International

and the National Anti Corruption Commission; directives written by successive DGs (Director
Generals); office memos and minutes of the meetings of the Board of Directors; news reports;4 and
previous financial, operational and organisational records. All of this proved very useful for
developing a general understanding of the structural conditions faced by managers of public sector
organisations in general and CAA managers in particular.

Another very important source of data was the interviews. Fifty-two interviews were conducted;
some of the interviewees were amongst the earliest employees of the organisation. The span of the
data collection phase was around six months (February, 2008 – July, 2008). Each interview lasted
from one to two hours. Notes were taken during the interviews and care was exercised to ensure
that there was a good mix and representation of interviewees in terms of their hierarchical position
(see Table 1) within the organisation as well as their years of experience.

The data obtained (via interviews and documents) were classified into three main codes
(‘conditions’, ‘interactions among actors’/‘strategies’ and ‘outcomes’) and further sub-coding
categories. Comparing these codes across various groups and positions gave rise to themes and
patterns.

Structural Constraints –

Exposes managers to pressures and insecurities, Senior managers are in a weak position against
politicians holding the public office.

Threat of being removed or relocated by the political bosses.

Lack of efficient judicial system makes it hard for the managers to defend and make a case against
the ministers.

Prime Minister – Ministry of Defence – DG of CAA and other officials

Example don’t land the plane with the army chief or the particular Pakistan International Airlines to
land.
Still they will be held accountable (Senior managers) during audits and all and by other government
departments.

Fear of reputational damage is always there.

Because of these the senior managers tend to vent it out and show their frustrations on the middle
and lower level management.

The beginning of the consultancy assignment for CAA was partly rooted in the efforts by the
Pakistani government to bring ‘good governance’ to public sector entities inspired by the World
Bank and IMF.