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C.T.S. Nair1

Despite the dramatic changes in the way people work, the organizations in which they carry out that work have changed much less than might be expected… 21st century organizations are not fit for 21st century workers. The Economist, 21 January 2006


Reforming public sector forestry agencies is a major challenge facing most countries (Bass et al. 1998; World Bank 2005). While government-run forestry departments have dominated the institutional scene for a long time, new players — like the private sector, community groups, civil society organizations and other government agencies — are taking over many of their functions. At the same time public sector forestry agencies are required to assume new responsibilities, often far outside their traditional domain. All these factors have necessitated a revisiting of their values and functions and making appropriate structural changes to maintain their relevance to the environment in which they operate. Adapt and re-invent or fade into irrelevance is the norm in an increasingly competitive environment.

Historically most public sector forestry agencies have been established as “command and control organizations” and the older the organization, the more deep-rooted is this approach. Shifting to the more appropriate “coordinate and connect” mode (Malone 2004) involves enormous challenges. Reform of forest policies and legislation in many countries remains ineffective in the absence of concomitant institutional reforms. Although institutional change is a key theme of study in business schools, this knowledge has not percolated into the forest sector and in many cases reform efforts have not necessarily improved the situation. While the role of public sector agencies has changed and will continue to change, better clarity is required on how to reform them while avoiding some of the pitfalls, which may sometimes even worsen the situation.


A host of inter-related factors, external and internal to the institutions, but primarily the former, compel institutional re-invention. Some, like long-term societal changes (which embed larger economic changes going far beyond growth in income and its distribution) are more fundamental, leading to a series of proximal drivers, especially changes in policies within and outside the forest sector and technological changes. A brief account of these factors and how they necessitate institutional change is outlined hereunder.

Long-term societal changes and their impact

Fundamental long-term changes in societies are affecting perceptions, values and, more importantly, the basket of goods and services people need and how they are produced. In general, most developing countries are characterized by the preponderance of land-dependent agrarian communities, with small segments of forest-dependent, and still smaller industrial and postindustrial societies. Structural changes in the economies reduce the proportion of agriculture and forest-dependent communities. As economies grow and diversify, the proportion of industrial societies (largely based on capital intensive production) and postindustrial societies tend to expand.

Demand for goods and services significantly differs between these diverse societal segments as do the technologies and institutions to meet them (Nair 2004). For example, forest-dependent communities derive most of their sustenance from forests, including a host of cultural, social and spiritual values while agrarian societies have very different needs, with access to land (often through forest clearance in the context of expanding agricultural population) and sustainable agriculture as the primary concerns. Industrial society’s main thrust is to use forests as a source of raw material, with increasing attention paid to improve productivity and quality. As a postindustrial society develops, objectives of management change, with provision of environmental services gaining primacy.Apart from setting aside large areas primarily for the provision of environmental benefits, even production forestry is subjected to stringent regulations to safeguard environmental functions. To some extent this has made wood production economically less viable in a number of postindustrial countries, encouraging shifts in forestry investments to low-cost emerging economies.

Proximal drivers of change

Long-term changes in societal structure, in particular the proportion of different segments, are attributable to several proximal drivers, including changes in economic, social and environmental policies. While the fundamental changes may be slow, a variety of factors and events, for example severe budgetary crises and catastrophic events like floods, may trigger policy responses necessitating appropriate institutional adaptation.

Changes in political and social conditions

Changes in political perceptions and their impact on economic and social policies are important drivers of institutional change. Economic liberalization policies envisage increasing involvement of the private sector in resource management with a corresponding diminution of the role of government. A wide spectrum of situations exists regarding changes in the relative roles of government vis-à-vis the private sector. Several countries that were formerly governed under centralized planning have re-instated private ownership of forests earlier appropriated by the state (World Bank 2005). Others are divesting ownership and management in a phased manner, initially focusing on participation of non-state actors (especially local communities, farmers and industries) in forest management without resorting to an outright transfer of ownership rights.

Public sector forests (in particular industrial plantations) become a too obvious target for disinvestment, especially in the context of budgetary crises and the continued pursuit of economic liberalization policies. Historically, public sector ownership of forests has been justified on account of the perceived strategic importance of timber and for the provision of environmental services. Several factors, including increased timber supply from alternate sources, especially from private land, have to some extent undermined the strategic reason for public sector control. As economic efficiency and competitiveness become important, private sector involvement in wood production has gained wider acceptance. Such is also the case with the provision of some of the environmental services, for example recreation, which are amenable to market transactions.

While policies on divestment of public ownership in some countries have been driven by efficiency considerations, in others, equity and social justice aspects have been important drivers of policy changes. These range from transfer of land ownership (i.e. as envisaged under the Tribal Land Ownership Bill passed by the Indian Parliament in December 2006) to partnerships in forest management and sharing of benefits (i.e. under the various arrangements for joint forest management). All these affect the responsibilities and functions of public sector forestry agencies, requiring substantial re-invention.

Economic compulsions

A changing economic situation, largely affecting commercial viability, is a major factor necessitating institutional change. Public sector organizations that are geared to the production of marketed goods are particularly vulnerable to such changes. In many countries, forestry departments had retained control over timber production by regulating prices of inputs and outputs and excluding competition. Total monopoly was maintained through rules and regulations relating to harvesting and transport of timber, even from private land. Economic liberalization policies and the removal of various controls are changing these approaches. Removal of barriers to the movement of capital and technology on account of globalization has accelerated the process. Traditional public sector organizations that have survived under protected conditions cannot continue in this fashion and the options available are rather limited: either re-invent or go out of business.

Environmental policies

Increasing concern about environmental degradation has led to a number of policy changes and these, like others, necessitate appropriate institutional responses. Environmental issues move up the priority list when some of the adverse economic impacts become evident (for example impacts of climate change, catastrophic events like floods and hurricanes, or gradual processes like land degradation, desertification and loss of biological diversity) or when the demand for some environmental service like recreation increases. Obligations to fulfil international conventions and treaties have also led to important changes. In many countries protected area management has been shifted outside the control of forestry organizations according to the argument that they are largely focused on wood production and hence inadequately equipped to address conservation issues. Either the organization has to make significant changes in its functions and structures, or give way to new organizations better designed to fulfil specialized tasks.

Technological changes

Technological developments are another major driver of institutional change. Developments in information and communication technologies seem to have significant impacts on organizations (UN 2005). Increased speed of communication necessitates rapid responses, and invariably traditional lines of command have become irrelevant, helping the shift from hierarchical to flatter organizational structures. Information communication technologies have also enhanced information access to the public, and a more informed public is making greater demands on institutions with regard to efficiency in the provision of goods and services and observance of social and environmental responsibilities. Information sources have proliferated undermining the power of those which thrived as the few controlling sources of such information. A substantial part of the information that was privy to public forestry agencies has moved into the public domain, and in a way has demystified the profession.


The aforesaid drivers described have a host of direct and indirect implications for the forest sector. Certainly the stakeholders in forests and forestry have increased as well as diversified substantially. Some of the impacts of the change are:

All these factors have led to varying institutional responses as discussed hereunder.

Overall direction of institutional change

In several Asia–Pacific countries and elsewhere, public forestry agencies are among the oldest civil services, established primarily to protect timber resources and hunting grounds. The approaches adopted in the management and deployment of resources have changed at varying paces in different countries. Table 1 summarizes the objectives and approaches to the management and consequent impacts on the structure and functions of forestry organizations.

Table 1. Changing institutional framework

Objectives of resource management

Main thrust

Functions and structures

Exploit/utilize what grows/is available under natural conditions (for example logging natural forests) and safeguard future timber supplies for strategic reasons.

Exclude others from exploiting the resources.

Policing the resources with a hierarchically structured organization

Improve the state of resources (invest in management including creation of assets like planted forests).

Build up resources using inputs like land, labour, capital.

Organization focused on resource management with substantial emphasis on technical and managerial skills

Empower/support other players — the private sector, communities, farmers, etc. — to develop and manage resources.

Create enabling conditions for other players to manage the resources efficiently

Negotiation/facilitation and conflict resolution skills. Organization with very diverse skills with the ability to respond quickly to the diverse needs of the various stakeholders.

Often, as is the case with public forestry agencies established a long time ago, there is a mixture of different characteristics and approaches. Many forestry departments in the Asia–Pacific region have a feudal past with policing to protect the forests as the main thrust. Over time there has been pressure to transform them to resource management and facilitation organizations. However, often the feudal values and perceptions linger on, promoting a culture of conformity that makes change extremely difficult (see Box 1).

Box 1. The culture of conformity

Many Forest Departments do not encourage forest officers to question their roles. For some this is a colonial inheritance; a complex bureaucracy was put in place to reward officers for perpetuating a status quo that best suits those at the top. Procedures that do this become, over the long term, ends themselves.

Bass et al. (1998)

Changes in forestry organizations

While most public sector forestry agencies in forested countries have been established primarily to manage timber resources, they have also taken up other functions including the processing and marketing of wood products and provision of environmental services. Low intensity wood production (and more particularly, the protection of timber resources for strategic reasons) enabled the fulfilment of other objectives including the provision of environmental services. Forest departments undertook a host of related functions including protection and management of wildlife, research, education, training, extension, etc.

Emergence of new players, the increasing demand for specific products and services and the difficulties in resolving conflicts between competing alternatives have made multipurpose management extremely difficult. Increasing emphasis on specialization and the entrusting of tasks to units or organizations with specific skills have necessitated the various changes as indicated hereunder:


Confronting changes: an overview of responses

Confronted with the various pressures, public sector organizations, including forestry agencies, respond in different ways. Broadly the responses can be grouped as follows:

  1. When an organization rightly or wrongly believes that the changes are temporary and after a period of time the situation will revert to “normal” there is a strong tendency to maintain the status quo dismissing external pressures as short-lived.
  2. Organizations also resist changes, especially if they require substantial reduction in the power and authority to control resources. This is particularly so in the case of organizations that derive their strength from controlling physical resources like land, water and forests. Decentralization of authority to local levels and transfer of ownership and management rights to communities tend to meet substantial resistance. A wide range of arguments resist changes, particularly if they undermine the power and authority of the organization.
  3. Bringing about superficial changes, largely focusing on the structure of the organization, is another common response. This involves focus on creating and reshuffling the boxes and changing their names and designations. Giving such a semblance of change often helps to keep intact their values and functions and counters the pressures for more fundamental changes. In many countries agencies have been renamed or moved from one ministry to another (for example forestry agencies transferred from agriculture to the environment) and new subdepartments/ divisions have been created, merged or the names changed. These manifestations seldom involve changes in their basic values and functions.
  4. Certainly, the most desirable situation is one of institutions proactively adapting to changes on a continuing basis, foreseeing emerging challenges and opportunities and preparing to face them via fine-tuning of institutional values, functions and structures.

Procrastination makes drastic re-invention inevitable

Continuous adaptation however is an exception rather than the rule, as the proportion of institutions that either resist change or at best undertake cosmetic reforms tends to be very high. Primarily this stems from weak accountability in terms of delivery of services, very different from the situation facing private sector organizations, where failure to adapt to changes is punished severely in the market place. For obvious reasons, government departments tend to escape market scrutiny and lean upon their alleged social and environmental roles for continued public funding.

Procrastination of institutional reforms and adaptation, although convenient in the short term, only serves to aggravate the problems. Delay in bringing about changes results in the organization continuously deviating from changes in the external environment. If eventually it has to be brought in line with the changed circumstances, the process will be drastic, difficult and painful. The ability to continuously adapt to changes obviates the need for drastic re-invention. At any time the basic questions that need answering are:

If any of the answers are in the negative, then the organization is out of step with the environment and a change is overdue.

Why is institutional change difficult?

While reform of public sector forestry institutions is critical, bringing about change is extremely difficult for a number of reasons:

Quite often the inherent ability to respond to change is also linked to the age of institutions and on the whole the older the institution, the more difficult to bring about changes. In a number of countries, the public forest service is the oldest civil service, sometimes more than a century old. Customs, practices and informal networks that develop over a long period may masquerade as virtues of stability and continuity, becoming stumbling blocks to change (Box 3). Even after major political changes, such institutions may remain intact. Especially if the organization provides power and influence to those who are a part of it, changes will be very slow and the system could hijack the process of change to its advantage. Claims of professionalism often provide a convenient ploy to keep the institution intact.

Box 3. Established traditions: strength or constraint?

In many countries forest authorities are the oldest, largest and most powerful land management agencies. This long tradition has facilitated a process of identity building (and) the development of an administrative sense of mission, which is very effective in perpetuating conformity to established norms and traditions and resisting external pressures.

Pettenella (1997)

Degree of re-invention linked to the extent of changes in the external environment

As pointed out earlier, an organization has three important elements, namely (a) core values and principles, (b) functions that reflect the values and (c) structure that enables it to undertake the various functions. The intensity of re-invention will primarily depend on the extent of changes in the external environment and the appropriateness of the institution in the changed circumstances. A complete overhaul of the institution encompassing all three elements would be warranted in the context of major political and economic changes. On the other hand some fine-tuning of the functions and structures would suffice in the context of less dramatic changes. For example, budgetary crises may compel a streamlining of the processes inevitably resulting in changes in the structure. Outsourcing or contracting out of some of the non-core activities to other agencies or even countries would be options that some have pursued. Such structural adaptation has particularly been catalysed by developments in information and communication technologies.

Approaches to bringing about changes

Change is a continuous process compelling institutions to iteratively adapt and innovate to make sure that their values, functions and structures are appropriate to the environment in which they function. Organizations that are able to continuously fine-tune themselves are “learning organizations” and have a well-developed mechanism to sense the changes and to adapt themselves. Those organizations that have to survive in the market place are more likely to be “learning organizations” as survival requires a high degree of ability to sense the changes in markets and timely adaptation. Public sector organizations, including government forestry departments, however, are less likely to be “learning organizations” for a number of reasons. Many have been established as “command and control” organizations with vertical channels for flow of information and action, extending the time lag for responses to change on the ground. Further, the larger and older the organization, the more the ability to adapt becomes curtailed. Especially in a situation where the pace of change in the external environment is rapid, the organization quickly falls out of line with societal needs and expectations.

When this happens, changes are necessarily externally driven. One question that needs to be addressed in such a situation is the pace of re-invention. In some cases a very rapid “big bang” approach is required, making changes within a very short period, rather than an incremental approach. Largely this depends on the degree of deviation from societal perceptions and the need to minimize the pains of transition. Also if the pace is slow, the opportunity for opponents to change to thwart any re-invention is strengthened (especially those likely to benefit from the status quo). Such “big bang” changes are more common in the context of major political and economic developments.

Balancing stability and change

Distinguishing between superfluous and fundamental changes in the external environment is of critical importance in deciding the nature of adaptation and in maintaining a balance between stability and change. If an organization is continuously making adjustments to superfluous changes, stability and continuity will be undermined significantly. Striking the right balance between stability and change is a major challenge facing most public sector organizations. While change is necessary and inevitable, some stability is also important, especially to establish consistency in the implementation of forest policies and, more importantly, to take advantage of institutional memory. The success of institutions largely depends on human resources and instability from overly frequent changes could seriously undermine such success. This is particularly important in the case of forestry, where accumulated knowledge and institutional memory are of critical importance.

Initiation and sustainability of change

Ideally an organization should have a built-in structure that is able to identify changes in its external environment and continuously adapt itself, appropriately modifying its values, functions and structures. However, most often this is not the case and institutions and people have a tendency to resist changes and to maintain the status quo. In the absence of a built-in internal mechanism to initiate and implement changes, this is often necessarily driven from outside. This is the typical situation when change is undertaken on account of political upheavals or often by external interventions such as donor initiatives.

There are also situations where charismatic leadership spearheads the change process. The impact of this largely depends on how the entire institution is prepared and involved in the transition. Very often they tend to be superfluous changes (often changing the name of the department or the organigram) to “leave a mark or stamp” by the leadership without really addressing the basic and often difficult issues. Such changes, whether driven from outside or by leaders internally, are unlikely to have a lasting impact, as they seldom influence the functioning of formal and informal structures and networks within the organization.

A major concern that many public forestry institutions face is the sustainability of change. In many cases, change is based on the perceptions of a few individuals and not always based on a thorough analysis of the environment in which the institution is functioning. Neither is the institution fully prepared to absorb changes, nor is the external environment conducive to such changes. While charismatic leaders are able to spearhead changes, often they are unsustainable on account of system rejection (either by forces internal to the institutional framework or by the external environment). This would imply that changes need to be relevant to the environment and substantial efforts are required to make them acceptable internally.

The human side of re-invention

Most often the difficulties relating to institutional re-invention are attributed to employee resistance. This is largely a misplaced criticism (Box 4). In most cases this is because the institution has failed to inculcate a culture of change by preparing the employees to continuously adapt to changes. In fact, in most situations, the paternalistic approach of management undermines professional development and promotes a false sense of security.

Box 4. Change: a natural process

It is common to hear that people in organizations resist change. In reality, people do not resist change; they resist having change imposed on them. Being alive, individuals and their communities are both stable and subject to change and development, but their natural change processes are very different from organizational changes designed by “re-engineering” experts and mandated from the top.

Capra (2002)

The need for programmed termination

As in the case of living organisms, organizations pass through different stages of growth, stability and decline. Often the strong survival instinct enables them to live beyond their useful lives. Ability to manipulate information enables organizations to secure public funding, which is often justified on the basis of tradition, history and so forth. Young organizations are better conditioned to adapt to changes. However, beyond a certain point adaptation becomes extremely difficult, requiring total re-invention. However, transformation into a completely different organization is constrained by system rigidities. Creating completely new organizations will be more cost-effective in the long term than changing an existing, dysfunctional public sector organization. This raises the issue of programmed closure through appropriate sunset clauses in the constitution of the organization.


Certainly the institutional scene in the Asia–Pacific forest sector is undergoing profound change in response to a host of drivers, both fundamental and proximal. No longer is it the exclusive domain of government forest departments, as a host of new players are emerging and taking over many of the traditional functions that were fulfilled by government forestry agencies until recently. Such changes are particularly disconcerting to forestry departments that have long histories and whose built-in mechanisms for adaptation are weak. Re-invent and adapt, or fade into irrelevance is becoming the norm in a rapidly changing competitive environment. Certainly the chances for many forestry departments as they are now, to fade into irrelevance are high, as more agile institutions emerge to meet the new challenges. This however is not a bad thing and often a necessity to ensure that institutions’ relevance is directly related to societal needs.

Avoiding decline requires that public sector forestry agencies become learning organizations, are fully able to understand ongoing changes and are able to make necessary adjustments on a continual basis. What is important is the ability to distinguish between superfluous and fundamental changes, and to fine-tune the different elements accordingly. Cosmetic changes — largely modifying the organigram — will be of little help and often may be damaging by delaying much needed fundamental reforms. Some of the broad conclusions that have been learnt during the last few decades on organizational change can be summarized as follows:


Bass, S., Balogun, P., Mayers J., Dubois O., Morrison E. & Howard B. 1998. Institutional change in public sector forestry. IIED Forestry and Land Use Series No 12. London, International Institute for Environment and Development.

Capra, F. 2002. The hidden connections. London, Harper Collins.

Economist, The. 2006. The new organization, A survey of the company. 21 January 2006.

Malone, T. 2004. The future of work: How the new order of business will shape your organization, your management style and your life. Harvard Business School Press.

Nair, C.T.S, Kaosa-ard, A. & Enters, T. 1998. Institutional changes in forestry research: Quo vadis? In Food and Agriculture Organization. Emerging institutional arrangements for forestry research. FORSPA Publication No 20/1998. Bangkok, Forestry Research Support Programme for Asia and the Pacific, FAO Regional Office.

Pettenella, D. 1997. New trends in public forestry administration. Paper for XIth World Forestry Congress, Antalya, Turkey, 13–22 October 1997.

United Nations. 2005. Unlocking the human potential for public sector performance. World Public Sector Report 2005. New York, Department of Economic and Social Affairs, UN.

World Bank. 2005. Forest institutions in transition: Experiences and lessons from Eastern Europe. Washington DC, PROFOR, World Bank.

1 Chief Economist, Forest Economics and Policy Division, Forestry Department, Food and Agriculture Organization of the United Nations. Email:

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