The Impact of Organizational Culture and Balance of Power on a Public-Third Sector Partnership (PTSP)

Partnerships, a form of contractual collaboration for service delivery, have been used for many years and their virtues and drawbacks investigated by many scholars. As described on paper, partnerships seem to be the best option for service delivery in today's cities. A primary driver, in fact, is to maximize efficiencies by identifying stakeholders' comparative advantages and harnessing key resources needed to achieve objectives that may lack or be insufficient in one actor's individual reserve. The rhetoric surrounding partnerships however do not often live up to the premise. Experience shows that irredeemable problems can arise at any stage of a project but that the most crucial stage is the initial stage in which demands are expressed and objectives defined. The human element of a project is that which threatens partnerships because partners come to the negotiating table taking their cultural baggage and interests with them. One of the key aspects that influence the workings of a partnership is the organizational culture of the stakeholders involved. Although every partnership entails a certain degree of adaptation between different cultures, the risk of culture incompatibility is still high and often degenerates in organizational barriers that are not easy to overcome. Contemporarily power relations are bound to characterize organizations because important decisions involve an allocation of scarce resources and scarcity in organizations exacerbates political behaviour. Politics involves the exercise of power to get something done, as well as to enhance and protect the vested interests of individual stakeholders. This thesis investigates the impact of both organizational culture and power on the workings of a Public-Third Sector Partnership (PTSPs) operating in a suburban town of Milan (Italy). The partnership aims to improve the social cohesion between local and migrant families and ameliorate the quality of health and housing services in the area. The thesis is limited to the analysis of its feasibility study. PTSPs are growing under the relevance given to Third Sector Organizations as key agents of social delivery within `the mixed economy of welfare', hence resulting in more competition amongst Third Sector Organizations to tap into local governments funds. The study developed multiple analysis frameworks to investigate the impact of culture and power on the outcomes of the feasibility study. One framework was built around two survey tools; Cameron and Quinn's (1984) Competing Values Framework was used to understand the dominant organizational culture traits of each partner, whereas the Degree of Knowledge Sharing was more experimental and looked at the balance of power as the expression of stakeholders' divergent interests. As expressed by Hilslop (2005) various degrees of knowledge sharing determines whether an organization is positively or negatively contributing to the organizational performance. A reluctance to share knowledge may be due to the willingness to use power to pursue interests that are in conflict with the organization. Therefore high knowledge sharing in one organization is an indicator that the balance of power is properly used to achieve organizational performance. In other words, the probability of a conflict of interests is in a linear relationship with the knowledge-sharing index that this thesis utilised. The second framework mapped the findings of the first onto a Relationship Matrix, which espoused the roles and responsibilities of each stakeholder in relation to the partnership's operational model. This model allowed the underscoring of the critical decision making points of the partnership (or Critical Value Point). The CVPs were matched with the areas where the previous framework detected a potential cultural conflict or a low Degree of Knowledge Sharing (these areas were called Critical Divergence Points). By using knowledge sharing as a complementary variable and by adding control statements to check for conflicting interests, the study revealed that a stakeholder a voluntary organization - was marginalised and virtually excluded from co-operating with other partners, as it was accused of wanting to use the partnership's budget to finance collateral projects. When compared with the pre-feasibility study, which set as a goal of partnership governance the co-operation of stakeholders on multiple initiatives, such events compromised the outcome of the final feasibility study. Of all partners, the voluntary organization had the lowest knowledge-sharing index, corroborating the linear relationship between the potential for a conflict of interest and the level of informal processes embraced by the organization. In this perspective a link was drawn to the organization's predominantly Clan culture. A collectivist culture, contrary to an individualistic one (for example a Market oriented one) does not instil a drive in people to explore when and why knowledge sharing situations may prove fortuitous. A Clan culture, in fact, is a closed culture where, for instance, employees prefer face-to-face meetings and are less likely to use an impersonal medium like the internet, resulting in barriers to acquiring knowledge from outside the group. This finding also validates why this research looked at culture within a partnership. On one hand, because of their inward orientation, Clan cultures often do not realise the effectiveness of knowledge sharing in partnerships, though paradoxically within their peers knowledge sharing is `the normal way', as long as it serves their own organizational goals. On the other hand, because cohesion and allegiance are so prominent, if the market turns somewhere else a Clan culture (that according to Cameron and Quinn's dimensions is high on flexibility and internal unity) would follow it without question. Empirical evidence suggests that very collaborative cultures often do not see the problem in diverging from the partnership's mission because in their organization they are used to diverge and adapt to the changing market at all times. This is why the conflict of interest became so clear with the voluntary organization and why co-operation with other stakeholders was seriously compromised This study suggests that there is a link between the symptoms, expressed as the degree of knowledge-sharing, and the root cause, or the organizational culture; it indicates that the most effective way to address organizational barriers in a PTSP is to devise and prioritize interventions according to the root-causes and not the symptoms, because the latter depend on the former. It suggests that the partnership's managers should strive for transparency, hence minimizing the informal space of Clan cultures. Finally it hints at the establishment of a `common culture' programme at the partnership's inception in order to reduce the space for conflicts between stakeholders and reduce the probability of a partnership's collapse due to cultural clashes. Acceptance to change should come from all members, thus cultural alignment must be led by executives from each organization.