dissertation of corporate social responsibility during gas exploration phase in remote areas of...
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CORPORATE SOCIAL RESPONSIBILITY
DURING GAS EXPLORATION PHASE
IN REMOTE AREAS OF PAPUA :
A COMPETITIVE STAKEHOLDER THEORY
D I S S E R T A T I O N
Submitted in Fulfillment of the Requirements
For the degree of Doctor
By:
ARRY PONGTIKU
0730407025
DOCTORATE PROGRAM IN MANAGEMENT SCIENCE
BRAWIJAYA UNIVERSITY
FACULTY OF ECONOMICS
MALANG
2010
DISERTATION
CORPORATE SOCIAL RESPONSIBILITY DURING GAS EXPLORAT ION
PHASE IN REMOTE AREAS OF PAPUA :
A COMPETITIVE STAKEHOLDER THEORY
By
ARRY PONGTIKU
0730407025
It has been defended in front of examiners
On 6 April 2010
It is stated that this dissertation has met the requirements
Signed
Promoter Commission,
Prof.Dr. Djumilah Zain,SE
Promoter
Prof .Armanu Thoyib, SE., M.Sc.,PhD Dr. Mintarti Rahayu,SE., MS
Co-Promoter 1 Co- Promoter 2
Signed,
On behalf of Dean of Economics Faculty
University of Brawijaya
Head of Doctorate Program in Management Science
Prof.Dr.Ubud Salim,SE.,MA
NIP.130 686 135
Dissertation Title:
CORPORATE SOCIAL RESPONSIBILITY DURING GAS EXPLORATION
PHASE IN REMOTE AREAS OF PAPUA : A COMPETITIVE STAKEHOLDER
THEORY
Name of student : Arry Pongtiku
NIM : 0730407025
Program : Post Graduate
Specification : Management
Promoter Commission
Promoter : Prof.Dr. Djumilah Zain,SE
Co-Promoter 1 : Prof .Armanu Thoyib, SE., M.Sc.,PhD
Co-Promoter 2 : Dr. Mintarti Rahayu,SE., MS
The Board of Examiners
Examiner 1 : Prof.Dr.Eka Afnan Troena,SE
Examiner 2 : Prof.M.S. Idrus,SE., M.Ec., PhD
Examiner 3 : Prof.Dr.Ubud Salim,SE.,MA
Examiner 4 : Prof.Dr.B.Kambuaya,MBA
Examiner 5 : Prof.Dr.Salladien
Examiner 6 : Big Leung,PhD (Australia)
Date of Examination : 6 April 2010
STATEMENT OF ORIGINALITY OF DISSERTATION
This dissertation reports the original work of the author, except as otherwise
stated. It has not been submitted previously for a degree at any university.
If this dissertation proves plagiarism, my DOCTOR predicate must be
cancelled and processed for punishment according to the Law Number 20 ,the
Year of 2003, article 25 at 2 and article 70.
Malang, 6 th April 2010
Arry. Pongtiku
0730407025
CURRICULUM VITAE
Arry Pongtiku, born in Ujung Pandang, 11 January 1968 , is 7th son from Mr.J.Pongtiku,SH and Mrs.Paulina Palungan. He grew up in Papua (primary school to high school),recieved in Faculty of Medicine in Sam Ratulangi University, North Sulawesi through PMDK/non testing program in 1987. He graduated his general medical doctor in 1994 and posted as a primary health care doctor in Batusuya, Donggala District, Central Sulawesi Province in 1994-1997.During in health center he worked also as assistant researcher of malaria and insecticide trial collaborated with Litbangkes SLPV Salatiga and British Company. He experienced in controlling outbreak of diarrhea and pilot project for healthy village model and settlement of indigenous people (Tajio). After 3 years in health center he then worked as a staff in communicable disease control in Central Sulawesi Provincial Health Office particularly for leprosy, tuberculosis and HIV/AIDS. In 1999, he followed International Short Course in Alert, Ethiopia for Tuberculosis and HIV control program. The year of 2000-2002, he received an opportunity to further study for Master of Health Management in the University of New England, Australia with scholarship from ADB (Asian Development Bank).He was a member of Wallacea Expedition Team in 2004 at the border of Sulawesi and Maluku oceans collaborated with Maritime and Health Department/Depkes RI as well as some universities. He got some national training including the training for technical evaluation program (from Depkes RI and KIT Amsterdam) and the operational research. He was a national facilitator for tuberculosis and leprosy program and part timely worked as a voluntary counselor for sexual workers and transsexual and also visiting lecturer for pharmacology and physiology in Muhamadiyah Public Health School and Pharmacist School in Palu. In 2004-2005 he worked in WHO (World Health Organization Indonesia) as a National Consultant for Tuberculosis Control Program in Sumatra (Lampung, South Sumatera, Bengkulu and Bangka Belitung). He returned to Papua in 2006 and worked as National Consultant for Leprosy and Yaws Control Program for Papua and West Papua Provinces under NLR/Netherlands Leprosy Relief and Depkes RI and as a staff in Communicable Disease Control in Provincial Health Office of Papua . In 2008, he participated in International Care and Rehabilitation Course in Pokhara, Nepal. Recently, he often led rapid surveys in remote areas and as part time health consultant for Nations Petroleum Oil and Gas in Rombebai Block, collaboration with Depkes RI and NLR (2006-2008). Since 2007, he studies for doctoral degree in The University of Brawijaya which collaborated with The University of Cendrawasih and recieved scholarship from NLR. He was a presenter in 3rd Doctoral Journey in Management Competition in Jakarta (2008). He is a visiting lecturer in Faculty of Medicine and School of Public Health in the University of Cenderawasih. Awards: Model of Student, Faculty of Medicine in The University of Sam Ratulangi in 1992 and Model of Primary Health Care Doctor in Donggala District in 1997. Recent Publications: “Creating a value from private-public partnership during gas exploration phase” (Ivanina Pane and Arry Pongtiku) IPA, 2008. He translated handbooks into Indonesian for his dedication: “TB di tempat kerja” (DOTS at Workplace, WHO publication) and “Atlas Kusta di Afrika” (Leprosy in Africans, ILEP publication). He married with Yulan Arunde and has a daughter Maria Christina Bellinda and two sons Jose Ananda Abimayu and Lachlan Arya Raditya Correspondence: [email protected]
Malang, April 2010 Arry Pongtiku
ACKNOWLEDGMENTS
Many data presented in this dissertation were collected during 3 years I supported Nations Petroleum Oil and Gas Company as medical consultant and coordinator of its CSR program in Rombebai Block of Papua as well as my correspondence to company, health department and local authorities in 2006-2008. Many supports I have received, therefore with this opportunity, I would like to express my thanks for
1) Rector of the University of Brawijaya, for collaboration and opening a distant class for doctorate program in Jayapura collaborated with the University of Cenderawasih.
2) Dean of the Faculty of Economics of Brawijaya who gives us opportunities to follow class and examination in Malang.
3) Rector of the University of Cenderawasih who has good ideas in developing education in Papua.
4) Head of Papua Provincial Health Office ,who gives me a permission to take this course
5) Head of Doctoral in Management Science, Prof.Dr.Ubud Salim,SE.,MA, who well manages students from various places in Indonesia, he is a gentle professor who strengthens disciplines, procedures and enhances quality of the program.
6) My promoter, Prof. Djumilah Zain,SE , I had dream her as my promoter since my first sight in the class, she is so special in guiding students.
7) Prof. Armanu Thoyib,SE.,M.Sc.,Ph.D, my co-promoter, a humble man, for supports, and most valuable comments, his short messages are always encouraging with end of words “good luck”
8) Dr.Mintarti Rahayu, SE., MS, my co-promoter, for her supports, encouragement and most valuable comments, she is unforgettable.
9) Prof. MS Idrus,SE.,M.Ec.,PhD, his lecture about strategy of competitiveness was so impressive.
10) Prof.Dr. Eka Afnan Troena, SE , his voice and style in teaching were unforgettable. He gave me some ideas of Corporate Social Responsibility (Business Ethics) and helped me in starting my dissertation.
11) Prof.Dr. Surachman, SE., M.SIE, teaches us about quantitative measurement and flexibility approach.
12) Dr.Ir. Solimun,MS , a guest lecture and an expert in Quantitative Method. 13) Prof. Dr Salladien (University of Malang), an expert in Mixed Methods, he
is a humble professor with his humanistic approaches. 14) Big Leung,PhD (from Australia) who firstly introduced me about Grounded
Theory and distant correspondence; her positive motivation and encouragement are really recognized.
15) Mr.Widyatmoko,SE.,MM who assisted in administration and arranged our visit to Malang;
16) Prof. Andrew.C.Wicks from The Darden School-UVA Virginia, one of key authors of Stakeholder Theory, and Drs.Agustinus Salle,MEc who gave their comments of my paper.
17) My sincere thanks to Nations Petroleum Oil and Gas Company partnered with Indonesian Health Department (Depkes RI) for their financial supports of this CSR, Mr. David Blevins, President and General Manager of Nations Petroleum who gave me permission to use the data for this dissertation. This study could not be realized without the supports from Mrs. Ivanina Pane and Mr.Aventinus Zebua and other friends in this company, BP Migas involved in monitoring this CSR. dr Nizar Shihab,
Sp.An (Special Staff of Minister of Health of Indonesia) and dr. Bambang Sardjono, MPH (Secretary of Directorate General of Community Health), Head of Sarmi Health Office, Head of Waropen Health Office, Head of Biak Health Office who supported this initiative as well as taking over the program into broader concept of Save Papua program.
18) Netherlands Leprosy Relief , which supports me for scholarship, Ir. Daan Ponsteen; Drs. Jolande Dekker,MPH ; dr Richard de Soldenhoff; Dianne van Oosterhout, PhD; Mrs. Sorta,SE from NLR Amsterdam and Jakarta; all NLCYs and dr Hernani ,MPH ; dr Christina Widyaningrum,MKes (Depkes RI) who encouraged me so much from beginning till finishing this project, thank you so much.
19) I like to express my thanks to Mr. Kuswadi,SKM,MKes, my friend also my informal tutor in discussion of epidemiology. Many thanks for contributions of the team in the field :dr Lucky; dr Thomas ; Mrs. Nurbani; Mrs Theresia (from Dinkes Waropen);dr Lina; Mr.Yorry (Biak hospital);Mr. Nico;Mrs. Nenny Mulyani; Mr. Made Gafar,SE. (Dinkes Province and Laboratory);Mrs. Enny,SKM.,MKes ; Mr. Mandosir (UNCEN School of Public Health); Mr. Fransiscus; Mrs. Eliana; Mr Yusak (Health Center of Mamberamo Hilir,Sarmi). Dr Imran and Dr Ilhami, SPOG (Depkes Jakarta) for their technical guiding; Mr. Wisnu; Mr Ones; Mr. Gea; Mr. Herman; Mr. Juis (Nations Petroleum), who arranged this trip and Ship Captain and Crews of Sibon and Mendel boat who brought us to the fields, without any accidents to the most remote areas.
20) My appreciation and thanks go to : Mr. Barnabas Suebu,SH (Governor of Papua); Alex Hesegem,SH(Vice Governor of Papua); Mr. Ones Pahabol,SE.,MM (Head District of Yahukimo); Mr. Habel Suwae,S.Sos.,MM (Head District of Jayapura); Mr. Drs.Fonataba,MM (Head District of Sarmi) ;Drs J.Rante,MM; Rivo Manangsang,MM; Dr.Agus Sumule; Mr. Lexy Maspaitela,SKM.,MKes who gave me some additional supports .
21) My wife Yulan, as well as my children Bella,Abby,Lachlan, I should like to thank for their patience during many hours I spent behind my computer and was not available for them, especially for their love and encouragement. My parents, Mr.J Pongtiku SH and Mrs Paulina Palungan; my mother in law Mrs Milka Arunde, congregation of Rehobot Church Jayapura for their prayers, my classmate and friends, communities in remote Mamberamo, and for those who could not mention one by one, which have helped this dissertation to be real, thank you so much and May God Bless You all.
ABSTRAK
Arry Pongtiku, Program Doctor Ilmu Manajemen, Pascasarjana Fakultas Ekonomi Universitas Brawijaya , Tanggal Ujian:6 April 2010 Tanggung Jawab Sosial Perusahaan pada Fase Eksplorasi Gas di Pedal aman Papua: Theori Stakeholder yang kompetitif . Promotor: Djumilah Zain, Ko-promotors: Armanu Thoyib, dan Mintarti Rahayu. Tujuan dari penelitian ini adalah menemukan suatu teori baru, khususnya penerapan Tanggung Jawab Sosial Perusahaan (CSR) hubungannya terhadap stakeholder. Penelitian ini dilakukan pada konteks khusus: Perusahaan pendatang baru bisnis minyak dan gas bumi di Indonesia memulai kegiatan CSR di daerah pedalaman Mamberamo-Papua dengan pendekatan kesehatan terpadu (mobile health team)pada fase eksplorasi gas termasuk didalamnya kegiatan sesmik dan pengeboran. Fase ini beresiko untuk gagal. Penelitian ini menggunakan metodologi campuran yaitu: Grounded Theory Mode 2 fokus pada penerapan ilmu manajemen serta didukung dengan Desain Eksperimental. Penelitian ini menghasilkan “Competitive Stakeholder Theory ” dengan proposisi teori : 1) CSR dengan filosofi Triple Bottom Line dan Teori Stakeholder adalah teori kompetisi yang dianggap sebagai manajemen strategis untuk mencapai suatu tujuan melalui pemaksimalan nilai. Tujuan Stakeholder Theory adalah untuk semua kepentingan stakeholder yang terlibat. Setiap stakeholder termasuk pemegang saham membagikan dan menciptakan nilai bersama yang berguna bagi mereka sendiri. 2) Teori Stakeholder adalah suatu proses dinamis dihasilkan oleh Kekuatan dan Pengendalian Stakeholder yang berakar dalam nilai etika/filosofi; Isu-isu yang ada; Strategi biaya efektif; Moral dan Kepercayaan; PDCA (Plan-Do-Check-Act); Pengakuan dan Menciptakan Nilai. Rangkaiannya merupakan proses terus menerus dan saling berhubungan. Selanjutnya penelitian ini memperlihatkan sebelum dan setelah intervensi (pengobatan dan penyuluhan) di masyarakat terjadi penurunan bermakna terhadap penyakit menular, di tempat kerja menunjukkan produktifitas tinggi karyawan. Nilai keseluruhan yang baik Malcolm Baldrige Score Card mengindikasikasi pelaksanaan manajemen CSR tersebut berkualitas. Teori Stakeholder diusulkan penerapannya pada situasi stabil dan tidak stabil seperti lingkungan yang turbulensi, terbatasnya sumber daya, daerah pedalaman, mengurangi resiko dan isu tanggung jawab sosial. Walaupun CSR dilaksanakan pada fase belum produktif (eksplorasi),akan terdapat penciptaan nilai untuk semua stakeholder terlibat khususnya masyarakat. Kata kunci: CSR,Teori Stakeholder,Kompetisi, Memaksimalkan nilai
ABSTRACT
Arry Pongtiku , Doctorate Program in Management Science, Post Graduate Economic Faculty Brawijaya University, Date of Examination: 6th April 2010. Corporate Social Responsibility during Gas Explorat ion Phase in Remote Areas of Papua: a Competitive Stakeholder Theory . Promoter: Djumilah Zain, Co-Promoters: Armanu Thoyib, and Mintarti Rahayu. The objective of this study was to discover a new theory, particularly in implementing a Corporate Social Responsibility (CSR) and dealing with Stakeholders. This study was carried out in specific contexts: a new comer in oil and gas business in Indonesia started its CSR in remote areas of Mamberamo-Rombebai Block of Papua with integrated health programs (mobile health team) during phase of gas exploration including seismic and drilling operation. This phase was at risk to fail. This study used mixed methods: Grounded Theory of Mode 2 which focused on application for management science and supported by Experimental Design. It is resulted “A Competitive Stakeholder Theory” with Theoretical Propositions are 1) CSR (Triple Bottom Line philosophy) and Stakeholder Theory are competing theories considered as strategic management to achieve objectives through value maximizing. The goal of Stakeholder Theory is pro all stakeholders involved. Every stakeholder including shareholder shares and creates values together which are useful for themselves. 2) Stakeholder Theory is a dynamic process that contributed by Power and Control of Stakeholders embedded in ethics/philosophy; Existing Issues; Cost Effective Strategies; Moral and Trust; PDCA (Plan-Do-Check-Act); Recognition and Creating Values. They are a continuous process and have an interrelated relationship. In addition, pre and post interventions in society showed dramatically in reducing communicable diseases. Workplace performed high productivity among workers. Good overall score of Malcolm Baldrige Score Card indicated the quality management of this CSR was in place. It is suggested this Stakeholder Theory would be applied at stable situation and at unstable situation such as uncertainty, turbulence, limited resources, remote areas, minimizing risk and issues of social responsibility. Although the CSR implemented in exploration phase or has not produced yet, there would be value creation for all stakeholders involved particularly community. Key words: CSR, Stakeholder Theory, Competitive, Value Maximizing
LIST OF CONTENTS
Cover and Proposal title Legalization of Dissertation in Doctorate Program in Management Science…….. i The Examination Team…………………………………………………………………… ii Statement of Originality of Dissertation…………………………………………………. iii Curriculum Vitae…………………………………………………………………………… iv Acknowledgment…………………………………………………………………............. v-vi Abstract (in Indonesian)………………………………………………………................ vii Abstract (in English)................................................................................................. viii List of Contents …………………………………………………………………………… ix List of Tables ………………………………………………………………………………. x List of Figures ……………………………………………………………...................... xi List of Annexes......................................................................................................... xii Abbreviation………………………………………………………………………………… xiii CHAPTER ONE: INTRODUCTION ……………………………………………........... 1 1.1 Background ………………………………………………………………………….. 1 1.2 Research Focus ………………………………………………………………………. 12 1.3 Research Problems…………………………………………………………………… 15 1.4 Purpose of this research …………………………………………………………….. 15 1.5 Implication of the Research …………………………………………………………. 16 CHAPTER TWO: LITERATURE REVIEW …………………………............................ 18 2.1 Definitions and Type of Corporate Social Responsibility ………………………… 19 2.2 Corporate Social Responsibility included Ethics and Laws …………………….. 21 2.3 Corporate Social Responsibility and Health Issues …………………….............. 29 2.4 Corporate Social Responsibility Concepts-Triple Bottom Line and Basic Heath/
Epidemiological Theory ……………………………………………………………… 32 2.5 Corporate Social Responsibility Implementations and Stakeholder Interactions 42 2.6 Corporate Social Responsibility and Competitive Advantage …………………… 60 CHAPTHER THREE: CONCEPTUAL FRAMEWORK………………………………… 71 CHAPTER FOUR: RESEARCH METHODS………………………………….............. 77 4.1 Research Design …………………………………………………………….............. 77 4.1 1 The grounded theory approach Mode 2 required for this study……………….. 84 4.2 Location of Research….……………………………………………………………… 92 4.3 Data Collection ………………………………………………………………………. 94 4.4 Data Analysis …………………………………………………………………………. 96 4.5 Credibility of Data …………………………………………………………………….. 104 4.6.Ethical considerations………………………………………………………………… 107 CHAPTER FIVE: RESULTS AND DISCUSSION…………………………………….. 107 5.1 Qualitative Results….….……………………………………………………………. 107 5.1.1 Qualitative Analysis in brief………………………………………………………… 107 5.1.2 Validation of the theory……………………………………………………………. 145 5.1.3 Working out problems in doing Grounded Theory……………………………… 147 5.2 Quantitative Analysis....……………………………………………………………… 153 5.2.1. Quantitative Analysis in brief…………………………………………………….. 153 5.2.2 Mobile Health Team Activities…………………………………………………….. 157 5.2.3. Workplace………………………………………………………………….............. 169 5.2.4 Malcolm Baldrige Score Card ………………………..…………………………... 171 5.3 Discussion…………………………………………………………………………….. 172 CHAPTER SIX: CONCLUSSION AND RECOMMENDATIONS…………………….. 194 REFERENCES…………………………………………………………………………….. 198 ANNEXES…………………………………………………………………………………... 209
LIST OF TABLES
Table 1. Top Health Risk Factors………………………………………….................... 40 Table 2. Stakeholder model on communication………………………….................... 50 Table 3. CSR motives at Multiple Levels of Analysis…………………………………. 51 Table 4. Progress of the high purpose company………………………………………. 58 Table 5. Classification of common success factors……………………………………. 66 Table 6. Mode 1 & Mode 2 : two different models for undertaking research ………. 86 Table 7.Previous Health Survey in Rombebai…………………………………………. 95 Table 8a. Examples of Stimulus and Action from transcription…………................... 108 Table 8b. Examples of Open Coding……………………………………………………. 117 Table 8c. Examples of Axial Coding (Step One)……………………………………….. 121 Table 8d. Group of Categories…………………………………………………………… 127 Table 8e. Matrix of Competitive Stakeholder Theory Framework……………………. 138 Table 8f. Validation of theory based S-O-R Paradigm…………………….................. 146 Table 9a.Activities of operation & medical team schedule (2006-2008)................... 156 Table 9b. Demography of villages study……………………………………………….. 157 Table 10a. Overall survey of malaria in period of Dec 2006- Feb 2008…………….. 158 Table 10b. Lymphatic filariasis in the villages………………………………………….. 160 Table 10c. Leprosy cases in Rombebai………………………………………………… 161 Table 11. Immunization in November 2007......……………………………………….. 162 Table 12. Mother and Child Care in Rombebai…………………………….................. 162 Table 13. Vaccines used for these trips………………………………………………… 163 Table 14. Age Distribution of Children under 5 for nutritional status in Anasi Baru, Dadat,Gesa and Kamai……………………………………………………… 163 Table 15a. Children under five with nutrition status based on index of BW/A in Anasi Baru, Dadat,Gesa & Kamai………………………………………… 164 Table 15b. Distribution of Nutritional status of children at school age based on BW/A in Anasi Baru and Dadat…………………………………………… 164 Table 15c. Risk of malnutrition in children at school with LILA (Upper Arm Circumference) in Gesa …………………………………………………… 165 Table 15d. Nutrition status in children at school age in Warembori (BW/A)……….. 165 Table 15e. Distribution of nutritional status among productive women & pregnant mother in Anasi Baru,Dadat,Kamai and Gesa………………………......... 165 Table 15f. Distribution of nutritional Status among productive women based on index of Body Mass (IMT) in Anasi Baru and Dadat……………………… 166 Table 16.Survey HIV and STD (Syphilis)……………………………………………….. 166 Table 17.Distributions some equipments for posyandu/health post…………………. 168 Table 18.The differences of Former and New Stakeholder Theory………………….. 179
LIST OF FIGURES
Figure 1. British Companies take CSR seriously………………………….................. 7 Figure 2. MDG-8 Ways to Change the World…………………………………………. 32 Figure 3. Triple Bottom Line……………………………………………........................ 34 Figure 4. The Epidemiological Triangle………………………………………………… 35 Figure 5. Health Determinants………………………………………………................. 38 Figure 6. Poverty and Health: A Vicious Circle………………………………………… 39 Figure 7. Stakeholder View by Ricklies…………………………………………………. 44 Figure 8. Stakeholder Relations ………………………………………………………… 45 Figure 9. Framework CSR linking with Outcomes…………………………………….. 49 Figure 10. Actors’ Mechanism to Influence Social Change………………………….. 51 Figure 11. Drama Triangle………………………………………………………………. 52 Figure 12. Strategy to develop cohesiveness……………………………................... 54 Figure 13. Aligned People………………………………………………………………. 55 Figure 14. CSR Management System Toshiba……………………………................. 56 Figure 15. Model of Changes by Tyagi…………………………………………………. 57 Figure 16. Scanning the Business Environment…………………………................... 60 Figure 17. The headquarters and learning by Merali and McGee……….................. 61 Figure 18. The roots of Competitive Advantage by Hill and Jones..………………… 64 Figure 19. (A) Economies Scale & Diseconomies of Scale. (B) The Impact of
Learning and Scale Economies on Unit Cost………. …………………… 65 Figure 20. The causal relationship between social capital and economic growth…. 68 Figure 21. The Hierarchy of Corporate Social Responsibility……………………….. 69 Figure 22. Research Paradigm………………………………………………………….. 71 Figure 23. Relationships among Workplace,Society and Infrastructure Development Framework..…………………………………………………. 73 Figure 24. CSR implementation during exploration phase…………......................... 75 Figure 25. Embed data in mixed methods research-modified for this study………... 78 Figure 26. The Inductive Model of Research in a Qualitative Study…….................. 83 Figure 27. Process of Research…………………………………………………………. 84 Figure 28a. The Stimulus-Response model…………………….……………………… 87 Figure 28b. The information processing model………………………………………... 89 Figure 29. Revised grounded theory approach & Paradigm model by Partington… 89 Figure 30. Map of Village Research…………………………………………………….. 94 Figure 31.An Interactive Model for Data Analysis…………………………................. 102 Figure 33. Freehand writing for testing connections of core categories and Subcategories………………………………………………………………… 129 Figure 34. Memo of CSR and Stakeholders Relationship……………………………. 132 Figure 35a. Substantive Theory…………………………………………………………. 134 Figure 35b. Formal Theory………………………………………………………………. 135 Figure 35c. Competitive Stakeholder Theory………………………………................. 136 Figure 36. Change of malaria cases in the four villages……………………………… 159 Figure 37. Health Data in workplace……………………………………………………. 170 Figure 38. Malcolm Baldrige Score Card………………………………………………. 172
LIST OF ANNEXES
Annex 1 Questionnaires Form…………………………………………………………… 197 Annex 2 Permission letter from Nations Petroleum……………………………………. 199 Annex 3 Nations Petroleum Company Profile……..…………………………………… 200 Annex 4 Community Involvement Study………….……………………….................... 205 Annex 5 Transcription and coding analysis report……………………………………... 211 Annex 6. SWOT Assessment Using Malcolm Baldrige……………………………….. 298
ABBREVIATION
BCG Bacillus Chalmette Guerin BPK Badan Pemeriksa Keuangan CDC Communicable Disease Control CSR Corporate Social Responsibility DJSI Dow Jones Sustainability Index DPT Dipthery Pertusis Tetanus EIA Energy Information Administration FBS Fever Blood Survey GCG Good Corporate Government GT Grounded Theory HBS Harvard Business School HIV/AIDS Human Immunodeficiency Virus/Acquired Immune Deficiency Syndrome HSE Health, Safety and Environment ISO International Standard Organization MBS Mass Blood Survey MDGs Millennium Development Goals MDT Multi Drug Therapy MoU Memorandum of Understanding NGO Non Government Organization NCLY National Consultant for Leprosy and Yaws NLR Netherlands Leprosy Relief NP Nations Petroleum PDCA Plan Do Check Act PITC Provider Initiative Testing an Counseling RDT Rapid Diagnostic Test RFT Release From Treatment STD Sexual Transmitted Diseases SWA Swasembada TBL Triple Bottom Line TB Tuberculosis UN United Nations USAIDS US. Agency for International Development WHO World Health Organization
CHAPTER ONE
INTRODUCTION
1.1 Background
Globalization offers many opportunities to companies, but also poses
challenges for sources of uncertainty and risk. Business practices, even those
conducted a very long way from their home markets, can be subject to intense
scrutiny and comment by customers, employees, suppliers, shareholders and
governments as well as other groups upon whose support the business relies.
NGOs become more and more powerful in recent years calling business to
account for policies in the areas of fair trades, human right, workers’ right,
environmental impact, financial probity and corporate governance ( Knox and
Maklan,2004). Some global companies have suffered the serious consequences
of not acting responsibly, for examples: Nike’s share price and brand sales were
damaged severely when the news broke regarding the poor production
conditions of its factories in Asia and Enron’s unethical practices led to the
company’s dissolution and criminal indictment of former executives (Lee,
accessed 09/26/2008). Roper Search Worldwide Research showed that about
75% respondents prefers goods and services produced or marketed companies
that give real contribution to their community through development program.
About 66% respondents indicated that they prefer to switch to other brands with
good corporate social image (Susanto, 2007).
The modern discussion of social responsibility got a major impetus with the
book Social Responsibilities the Businessman (1953) by Howard R.Bowen, who
suggested that businesses should take into account the social implications of
their decisions (Weihrich and Koontz, 2005; Lee, accessed 09/26/2008). There
are several definitions of Corporate Social Responsibility (CSR) in literatures;
one of them is from World Business Council for Sustainable Development:
“Corporate Social Responsibility is the continuing commitment by business to be
have ethically and contribute to economic development while improving the
quality of life of the workplace and their families as well as of the local community
and society or larger” (cited in Wibisono, 2007). Triple Bottom Line theory is
currently adopted and become a heart of Corporate Social Responsibility
practices. The three lines represent society, the economy and the environment.
Society depends on the economy and the economy depends on the global
ecosystem, whose health represents the ultimate bottom line. Triple Bottom Line
reporting, a term coined by John Elkington (1997), involves measuring and
reporting economic, environmental and social performance objectives that are
practiced simultaneously .In other words, there is balance among profit, planet
and people (Elkington accessed on 3/17/2008 ; Sustainability, 2003; Chapman,
2003; and Wibisono, 2007). In my point of view, Corporate Social Responsibility
is an effort by corporate and its stakeholders working together increases the
quality of life of the work place and local communities or society in general, and
share responsibilities, risk and respects. Social aspects such as improving health
and education, environmental care and community development are basically
responsible for all.
Social Responsibility and Corporate Social Responsibility concepts are
actually not new. These concepts had been practiced long time ago such as
during Muhammad’s time. In commerce, riba meaning usury or interest was not
allowed; investors were not permitted to escape the consequences of any failed
venture- all financing was equity financing (Musharaka). This sociology becomes
principles of Islamic bank and Islamic economics to day. Perhaps due to
resource scarcity in most Islamic nations, there was an emphasis on limited use
of natural capital i.e. Producing land. Tradition of haram and hima and early
urban planning were expression of strong social obligation to stay within carrying
capacity and to preserve the natural environment as an obligation of khalifa or
“stewardship. Muhammad is considered as a pioneer environmentalism. His
Hadiths about agriculture and environmental philosophy as compiled in Book of
Agriculture by Sahih Bukhari "There is none amongst the believers who plants a
tree, or sows a seed, and then a bird, or a person, or an animal eats thereof, but
it is regarded as having given a charitable gift (for which there is great
recompense).” Several such statements concerning the environment are also
found in the Qur'an, such as the following "And there is no animal in the earth nor
bird that flies with its two wings, but that they are communities like yourselves"
(Wikipedia accessed on 3/27/2009). Christian Missionaries for example: have
been practicing to help the poor for many years ago. Mother Theresa spoke to
her attentive audience when accepting the Nobel Peace Prize. She said that
every one could be a missionary of charity, through humble love and service;
they could discover the face of Jesus under the distressing disguise of the needy.
Jesus makes Himself the hungry one, the naked, the homeless one, the sick one,
the one in prison, the lonely one, the unwanted one, He says” You did it to me”
(Kolodiejchuck,2007).
Many writers believe CSR is a strategic business (Asongu, 2007). Pioneers
/business leaders, such as Robert Owen and Francis Cabot Lowell and his
Waltham Associates for instances, provided a view of the obligations of firms as
the Industrial Revolution made an impact on society (Wren, 2005). Carnigie
(1835-1919) in iron and steel industry, John Rockefeller (1839-1937) and his son,
John Rockefeller Jr. (1874-1960) in oil business and Henry Ford (1873-1974) in
car industry, were not only successful business men but also popular
philanthropists. Carnigie in addition said that the rich is responsible to help the
poor, because the wealth is only a trust fund (Bertens, 2000). Peter Drucker
(1974, 2008), the father of modern management, says there are three tasks,
equally important but essentially different in the dimension of management: First,
establishing the specific purpose and mission of the institution whether business
enterprise, hospital or university; Second, making work productive and the worker
effective; Third, managing social impacts and social responsibilities. Erna
Witoelar cited in Warta Pertamina (2007) CSR goes beyond Public Relations.
Bateman and Snell (2008) in their book Management Leading and Collaborating
in a Competitive World include ethics and CSR are part of strategic values. They
comment in the past time, profit maximization and CSR are considered as
antagonic things, however since to day business world is more ethical, those
perspectives can be met. In the past time, attention of CSR is just focused on
right or wrong doings, but now the perspectives go to competitive advantage. The
Caux Roundtable which were participated by businessmen from Japan, Europe
and America declared “Caux Principles” namely kyosei and respect human
beings. Kyosei means stay and live together to produce general benefits,
collaborations and mutual prosperities based on fair and supportive competition.
Kotler and Pfoertsch (2008) say future trend emphasizes Corporate Social
Responsibility and Design as important developments to change and redefinition
of management brand. Blumenthal and Bergstrom cited in Guzmán accessed on
5/4/2009 argue both branding and CSR have become crucially important that
organizations have recognized how these strategies can add from their value.
There are four key reasons for integrating CSR under the umbrella of the brand
which are; recognizing the magnitude of the brand promise; maintaining
customer loyalty; maximizing investment that would be placed in CSR regardless
of the brand; and avoiding conflict with shareholders. Lönnqvist (2002) value of
brand is a financial phenomenon. However, the brand itself is intangible and
immaterial asset. Pambudi (2005),Wibisono (2007) CSR has been monitoring
in internationally economic market such as New York Stock Exchange through
Dow Jones Sustainability Index (DJSI), London Stock Exchange, Hangseng
Stock exchange and Singapore Stock Exchange. On consequences, global
investors will more likely select to invest to those firms which are listed in the
indexes. Porter and Kramer (2006) comment that Corporate Social Responsibility
can be much more than a cost, a constraint, or a charitable deed; it can be a
source of opportunity, innovation and competitive advantage.
CSR enhances a social capital. Halperen (2005) notes social cohesion is
critical for societies to prosper economically and for development to be
sustainable. Social capital is not just the sum of the institutions that strengthen a
society. It is the glue that holds them together. In addition, there is relationship
between social capital and economic growth. Social capital plays in improving the
flow of information through an economy and generally lowering transaction costs.
Social capital may have indirect positive effects on the economy, such as by
encouraging the development of a legal and public policy environment that
further reinforces trust and is conducive to long-term human and physical
investment. Jaya Suprana (2005) the groups are generally supporters of a
corporation’s principal purpose is to maximize returns to its shareholders should
not be worried because CSR is a source of long-run profit. Corporations which
are responsible for its environment may have a good image and encourage
society sympathy. The feeling of sympathy is a good foundation for relationship
between producer and consumers. Bateman and Snell (2008) say Adam Smith
wrote A Theory of Moral Sentiments where “sympathy” means respect to others
is a great foundation of responsibly modern culture. Similarly, Pambudi (2005)
SWA’s survey among 45 corporations found as reasons to implement CSR:
maintain and increase image of corporate were mostly selected by respondents
(37.38%); make better relationship with communities (16.82%); and support for
company‘s operations (10.28%). However whatever reasons are, Phil Watts,
Group Managing Director Royal Dutch/Shell Group bravely says “CSR is not a
cosmetic; it must be rooted in our values. It must make difference to the way we
do our business”.
Bactiar Chamsah, former of Social Minister of Indonesia, comments due to
complexicity of social problems facing by government, we encourage to
corporations to support communities. Social investment will be useful for
corporations it self and will be gained it in the future so CSR is a must. By law of
Indonesia of the Republic of Indonesia Number 40 of 2007, Article 74 concerning
Limited Liability of Companies, ratified in Jakarta on 16th August 2007 mentioned
that: Companies doing business in the field of and/or in relation to natural
resources must put into practice Environmental and Social Responsibility.
The CSR practices are now increasing. Tunggal (2008) notes in USA that
there are about 155 companies have had Public Policy/Social Responsibility
Committee of Boards, 67 companies have included Social Responsibility
Statement in their annual report, 22 companies have issued Special Report on
Corporate Citizenship, 27 companies have published Statement on
Responsibility, Contribution Policies and Procedures and 38 companies have
published Reports on Contributions. Similarly, Arena (2008),the winner of
Nautilus award for the best business book, wrote “The high - Purpose Company”
(surveys of 75 big companies) is a new trend in business of responsible and high
profit companies. Bevan et al (2004) shows the attitude of respondents towards
30 leading British companies. There is a strong positive correlation between
companies that are seen to take their responsibilities towards society seriously
and those seen as a good employer to work for as a picture below.
Figure 1. British Companies take CSR seriously (Bev an et al, 2004)
In development of CSR and managerial practices, some problems are found
in literatures. Corporate Social Responsibility (CSR) is considered a controversial
subject that continues to attract a lot attention-from those who argue that the
whole is irrelevant to business, through those see the relevant but think it is a bad
idea for business, to the vast group of writers who think that CSR is of strategic
meaning to business (Asongu, 2007). CSR is still new global phenomenon which
was primarily a phenomenon found in the United States and the United Kingdom.
Many companies in these countries have gone high commitment for CSR
(Tunggal,2008;Bevan et al,2004) ,on the other hand significant number of
companies practiced CSR to just fulfill regulation while avoiding extra cost and
do not see CSR issues as new opportunities such as in Korea (Lee, accessed on
09/26/2008) , continental Europe had not expressed much interest in the concept
(Falck and Heblich, 2007).There remains a lack of consensus regarding the
definition of corporate social responsibility and no framework or model for a
systematic accounting for examples suggesting economic and legal obligations
as well as certain responsibilities to society in corporations ’s activities as cited in
Lee, accessed on 09/26/2008.
In relation to CSR, some studies mentioned that companies which practiced
CSR have problems dealing with their stakeholders (Knox and Maklan, 2004;
Kolk and Pinkse, 2005; Warhurst, 1998). Clarkson strongly concludes after 10-
year study of CSR that researcher should concentrate on how companies
actually manage their stakeholders rather than upon empherically validating
inherently untestable frameworks of social responsiveness (Knox and
Maklan,2004). Freeman in 1984 originally defines Stakeholders as “any group or
individual that can be affected by the realization of a company’s objectives”. Post,
in theory of Stakeholder view , "The stakeholders in a corporation are the
individuals and constituencies that contribute, either voluntarily or involuntarily, to
its wealth-creating capacity and activities, and that are therefore its potential
beneficiaries and/or risk bearers”. Stakeholders theory consists of fairness
principle (John Rawls) and moral foundation (Robert Philips) cited in Wikipedia,
accessed on 1/20/2008). In some extent, stakeholders have different perception
and motives and CSR considered not cost-effective, responding to criticism
(Munila and Milles, 2005; Koestar, 2007 ) and even corruption and lip services
(Petrominer,2008; Pane, 2008; Norman and MacDonald, 2003;Lee, accessed
09/26/2008; Arena, 2008). The benefits of CSR are still hard to measure as cited
in Tsoutsoura, 2004. Many managers, says HBS Professor Michael C. Jensen
(2000), are caught in a dilemma: between a desire to maximize the value of
their companies and the demands of stakeholder theory to take into account the
interests of all the stakeholders in a firm. Value maximizing tells the participants
in an organization how they will asses their success in achieving a vision or in
implementing a strategy (the scorecard for the organization), but value
maximizing says nothing about how to create a superior vision or strategy and
value maximizing also says nothing to employees or managers about how to find
or establish initiatives or ventures that create value.
As mentioned above, many companies have already practiced about CSR;
however this study will argue that CSR in remote areas and during gas
exploration phase is invaluable and unique. Indonesia particularly Papua is very
rich with mining and other natural resources. Purwantoro (2008) states that the
potency of oil and gas in Indonesia is still able to develop in remote areas,
deep ocean and old wells as well as eastern parts of Indonesia which relatively
have not been explored yet. On the other hand, those areas with less difficult
levels, of course, had been practically exploited. It is therefore, even oil and gas
business is significantly promising, needs huge capitals, expensive technology,
maximal efficiency and valid human resources.
Remote areas gave strongly and emotionally unforgettable experience for me.
My experience working in Central Sulawesi, Sumatera and Papua showed many
health problems and neglected areas such as in the remote places (Pongtiku,
2004; 2005; 2006; 2007).A lesson learned in the past in relation to health and
company in the remote area showed that investment and development in the
remote area could not be followed by indigenous people. David Tonkin (1997) in
his thesis “Spears of Development? Comparative impacts of the Freeport
mine,Irian Jaya”, remarks despite positive changes by Freeport operation such
as setting up numerous community programs and providing services to local
population and jobs for 16,000-17,000 people ( 11%-15% filled by
Irianeses/Papuans where several hundreds were employed unskilled jobs from
local villagers),launching 1% of Trust Fund, some poor experience in the
beginning project were noted that the intrusion of Western commodities such
cigarettes and alcohol has reputedly led to a breakdown of indigenous cultural
values in the area and increased in the incidence of social crimes and alcohol
problems among local youth. Local trader exploited cheap alcohol, pornography
and prostitution. Significant HIV/AIDS in Timika among sex workers were
reported. In this isolated area of a country with little HIV/AIDS education, a
spread of the virus seems likely. Efforts to resettle Amungme communities
around Timika for instance, encountered numerous difficulties. Those people are
mainly garden cultivators by tradition, but were now living in a location where
they had rely on scarce supplies of sago and poor fishing ground, and the two
hectares of land allocated to each family was of low soil fertility. The settlers were
also particularly susceptible to malaria, a disease much more common in
lowlands than in their much cooler highlands. In mid-1980, an epidemic swept
through the resettlement killing 216 children, more than twenty per cent of the
infant population.
Similarly, Ahmad Arif (2008) and Wibisono (2007) reported about conflict and
social gaps in Timika. The local people have not only lost their natural resources
but also their own identity. Drunk ness and spending millions rupiah even single
night by the mining workers are the reality of life in Timika currently. Battle among
local tribes and protest to the company were often happened. Bertens (2000)
notes relationship between corporate and community became recently urgent if
we observed the news of big companies such as Caltex in Riau or Freeport in
Papua. PT Freeport Indonesia (2005) however reported, Business Week
magazine had selected Freeport Mc Moran Copper & Gold Inc as the first rank of
among generous American Corporations in 2003 and 2004. This
acknowledgment has continuously and strongly increased commitment of the
Freeport to support CSR programs. In 2004, PT Freeport donated 72.7 millions
US dollars for the community development programs. As cited in Pambudi
(2005), Michael Porter, a management guru, strengthens CSR should not come
from reactions but it is indeed proactive activities to develop and to give
advantageous values for stakeholders. ”It is true that economic and social
objectives have long been seen as distinct and often competing. But this is a
false dichotomy…Companies do not function in isolation from the society around
them. In fact, their ability to compete depends heavily on the circumstances of
locations where they operate” (Porter and Kramer,2002 cited in Suharto,2007).
Abraham Lincoln also says “You cannot escape the responsibility of tomorrow by
evading to day” cited in Wibisono, 2007.
Investments in oil and gas exploration phase are risky and very expensive. Oil
and gas wells are never a sure thing. Some projects which had average amount
of billions /hundreds millions dollars were closed in this phase and lost of huge
investment because of dry well, fail to find commercial reserves and abnormally
high pressure. . EIA (2007) reported examples of the projects which had been
closed and invested by companies in Azerbaijan: “Project of Lankaran-Talysh,
2001 (TotalFinaEf-35%, Wintershall-30% , Socar-25%,OIEC Iran-10% of
investment); Oguz, 2002 (Exxon Mobil-50%, Socar-50%); Nackhchivan, 1997
(Exxon Mobil-50% , Socar-50%); Yalama/D-222,1997( Lukoil-80%,Socar-20%);
Kurdashi-Araz Kirgan Danis,1998 (Socar 50%, Agip 25%,Mitsui-15%, TPAO-
5%, Repsoil-5%); Atashgah, 1999 (Socar-50%, JAOC-Consortium-50% ); Zafar
Marshal ,2000 (Socar-50%, Exxon Mobil-30% , Conoco-20% ); Muradkhank-
Jafarli-Zardab, 2001 (Ramco- 50%,Socar -50%)”.
A medical site survey which was firstly carried out by Hospied and Zebua
(2006) in Rombebai Block –Mamberamo reported about communicable disease
and working environment at risk including work on site and transportation. Then,
(Pongtiku, 2006, 2007) the serial communicable disease surveys showed that
those areas (locations of this research) have burden of communicable diseases
such as malaria, leprosy, tuberculosis, filariasis, yaws, and worms and finally
included HIV/AIDS. Immunization and mother and child health services were
missing. The company recruited the local people where the camp station was
relatively closed to community. This might bring the communicable diseases into
workplace. People from outside (non endemic area) might be more at risk to
suffer the diseases than local workers if they worked in the place.
CSR in health sectors particularly in communicable diseases control has
been relatively few done and still limited in publication. PT Rio Tinto in East
Kalimantan was an example of CSR in tuberculosis control program (Tunggal,
2008). Furthermore, WHO (1999) reported that the economic impact of repeated
episodes of illness and long-term disability is a major cause of underdevelopment
in many countries to day. Most death from infectious diseases-almost 90% are
caused by only a handful of disease. No more than six deadly infectious
diseases-pneumonia, tuberculosis, diarrhoeal diseases, malaria, measles and
more recently HIV/AIDS-account for half of all premature deaths killing mostly
children and young adults. On the other hand, leprosy, lymphatic filariasis and
yaws are examples of diseases which cause people disabled.
Elimination/eradication of infectious diseases is a part of poverty alleviating
strategies.
1.2 Research Focus
This study was carried out in the specific contexts: Nations Petroleum
Company as a new comer in oil and gas business in Indonesia started a CSR in
very remote areas with an integrated health program at very beginning of their
project during phase of gas exploration including seismic and drilling operation.
This phase was critical which was at risk to fail (uncertainty condition). Due to
remoteness and difficult access, the operational cost was of course very
expensive. The well of Otus 1 Tamakuri and Pitohui –Papua (Nations Petroleum-
100%) had been eventually closed in October in 2007 (Pongtiku, 2007). Talking
about such condition, Nonaka and Takeuchi cited in Merali and McGee (1998)
say that, it is greatly important for learning, innovation and knowledge creation in
dynamic, uncertain context. To day, remote areas become very important issues
if we talk about equality, affordability and accessibility because health is for all.
Governments to individuals through MDGs are encouraged to reach them (IBC
Working Group, 2007).
Salladien (2008) says that a research focus means dimensions which are
being concerned, are based on the phenomena of humaniora, management,
economics, social, education, cultures and so fort occurred in society. As
mentioned above, this CSR study was implemented in uncertainty phase of gas
exploration in remote Mamberamo, Papua Province in Indonesia. The remote
places have high incidence of communicable diseases. The CSR particularly
used a national health /WHO guideline with low cost effective strategies and an
integrated health approach.
The first Social phenomenon was recognized after one year implementation of
the CSR, through intense field observation and discussion. There was an
interaction of three elements: place, actors, and activity. Local people were
mobile; they came and stayed near the seismic camp meanwhile the company
recruited local people as labors. ‘Every two weeks the local labors are off and
back to their family and come again the next two weeks to the camp. Workers are
also likely to visit the local people at night. It is not impossible to spread
communicable diseases into the workplaces and may threat the productivity of
the workers’. It was therefore the mobile health team model was formed to solve
the situation. My first hypothesis (H1) was “treatments and health educations
through mobile health team in local communities will reduce burden of
communicable disease in the communities in project locations and will also
protect the workplace towards the communicable diseases”. Epidemiological
Model by John Gordon describes interactions of important factors of Host, Agent
and Environment for determining health status. Treatments in this case do not
only mean to cure the patients, but also interrupt transmission of the
communicable diseases, it is then the best prevention. To describe the situation,
we used a quantitative method (experimental design) which will be measured by
pre and post treatments of diseases in the communities; and health and safety
statistical data in the workplace. This is a risk management control. According to
New Webster’s dictionary and Roget’s Thesaurus (1992), team means group of
people working together and mobile means easily moved, capable of moving
rapidly from place to place. Health program in this case is an integrated approach
(bring some health programs together to service in communities). Olkknonen
cited in Lönnqvist (2002) describes the logical chain of reasoning to
operationalizing a phenomenon as follows: Describing the phenomenon ---
Conceptualizing and defining the phenomenon --- Determining how the
phenomenon can be quantified --- Measuring.
The second social phenomenon was stakeholder interactions and conflicts.
This phenomenon appeared after one and a half years implementation where
more stakeholders were involved and activities were getting bigger and bigger.
The interaction of stakeholders was among Company, Government : National
Health Department, Ministry of Health, BP Migas, Provincial Health Office,
District Health Office, Biak Hospital, NGO (Netherlands Leprosy Relief), and
Local community. For this study my second pre proposition (P1) was “working
with stakeholders is a power to implement CSR and can create advantageous
values during gas exploration phase”. It was felt that it needed the further
discoveries to understand what, why and how stakeholder was a power and will
have value creations in this special context of uncertainty condition of the
exploration phase, geographical difficulties of remote area location and as a new
company which enter a new business in Indonesia.
1.3 Research Problems
In light of the importance of CSR, the problems are pursued:
(1) How to generate a new theory of CSR in remote area during gas
exploration phase (uncertainty condition which is at risk to fail) where the
philosophy of Triple Bottom Line and the needs between company and
stakeholders (government and society) are appropriately addressed?
(2) How to implement CSR during gas exploration phase which can create
values including more cost effective, transparent ,competitive , as well
as sustainable?
1. 4 Purpose of this research
General Objective :
To discover a new theory, particularly in implementing a Corporate Social
Responsibility and dealing with Stakeholders during gas exploration phase.
Specific Objectives :
1. To understand the process of the CSR interactions with stakeholders and its
values in management during gas exploration phase.
2. To observe and describe the effect of the CSR for both side company and
community during gas exploration phase.
To understand precisely the process of dealing with stakeholders in coordination,
planning, implementation and evaluation as well as interaction among actors,
conflicts and solutions I select mix methods. The first method is qualitative for
grounded theory. The Grounded theory is the approach to discovery theory from
data as cited in Partington (2000). In this case, the researcher was deeply
involved during this process. Based on this method, all events, incidence and
evidence as social situation which occurred in the field, in the meetings, in
dialogues/interviews, in emails and others were observed, recorded and
analyzed. The second method is quantitative for experimental research. We
analyze pre and post heath interventions, workplace and a self assessment using
Baldrige Scorecard. In addition, McGrath (1998) says a study which advocates a
dynamic, experimental approach to strategy offers a theoretically grounded
framework for understanding how experimentation can yield advantage. It is
obvious now that the research problems according to the real phenomena
above have strengthened the depth of this study.
1.5 Implication of this research
1.5.1 Practical implications
This study helps and strengthens corporate and managers, how to collaborate
with other stakeholders in dealing with CSR (Corporate Social Responsibility)
issue and at the same time, the stakeholders understand how to deal with the
corporate. CSR is beneficial both community and workplace even in unproductive
phase of companies. This study can be useful for company and its stakeholders
particularly in Health and Safety Management, Community Development, Risk
Management as well as reaching MDG issues. This research encourages a
health initiative how to reach remote areas includes effort to achieve millennium
development goals. Remote areas maybe places of future exploration of oil and
gas in Indonesia, so this developed theory might be relevant. It opens the
mystery of remote areas issues and describes about Papua situation including as
an advocation for neglected diseases and an integrated approach. The study
proves that health intervention with low cost strategies intervention as
recommended WHO and Depkes RI can work even difficult and very remote
areas with limited infrastructures. In addition, this study describes up to date
issues about CSR particularly in Indonesia including regulation, cost recovery.
The developed theory enhances more transparent, efficient, effective and
innovative approaches for CSR.
1.5.2 Theoretical implications
This research contributes and enriches about stakeholder theories/partnership
management. The developed theory enriches the knowledge of strategic and
operational management of Corporate Social Responsibility (CSR). This study
also demonstrates the interactions of social concepts, psychology, epidemiology,
ethics, law and economics together applied for a CSR theory. This study enriches
multilevel theories of social change in organization and may contribute for a risk
management approach.
CHAPTER TWO
LITERATURE REVIEW
This chapter provides a critical reviews relating to Corporate Social
Responsibility. Implementation of the CSR (mobile health team) is based on
basic health concept combined with effective and efficient management theories.
Important frameworks for stakeholders are presented. Salladien (2008) says
literature review in a qualitative study is aimed to understand and to find a
theoretical /conceptual framework which is relevant to research phenomena. The
references are important because firstly the researcher can strongly explain the
supporting theories in order to make theoretical framework clear, and secondly
the theories which are linked in the frame of research focus, enable to explore a
research paradigm (basic sets of beliefs that guides actions). In simple way, it is
said that the research paradigm consists of the number of theories which will
frame to carefully scrutinize the research focus. We will go through some
models, theories and previous studies, which enrich and enfold in generating a
new theory of CSR. I would like to present it in the following:
1. Definition and Type of Corporate Social Responsibility
2. Corporate Social Responsibility related to Ethics and Laws
3. Corporate Social Responsibility and health issues
4. Corporate Social Responsibility Concepts –Triple Bottom Line and
Basic health/epidemiological theory
5. Corporate Social Responsibility implementations and Stakeholders
Interactions
6. Corporate Social Responsibility and Competitive advantage
2.1. Definition and Type of Corporate Social Respon sibility
There are some definitions of Corporate Social Responsibility. It is mentioned as
follows:
World Business Council for Sustainable Development
“Corporate Social Responsibility is the continuing commitment by business to be
have ethically and contribute to economic development while improving the
quality of life of the workplace and their families as well as of the local community
and society or larger”.
The World Bank Group
“Corporate Social Responsibility is the commitment of business to contribute to
sustainable economic development, working with employees and their
representatives, their families, the local community and society at large to
improve quality of life, in ways that are both good for business and good for
development”.
European Union (EU Green Paper on SCR)
“Corporate Social Responsibility is a concept whereby companies integrate social
and environmental concerns in their business operations and in their interactions
with their stakeholders on a voluntary basic” (cited in Wibisono, 2007)
Erin Lyon
“Corporate Social Responsibility (CSR) means a company’s commitment to
operating an economically, socially and environmentally sustainable manner (at
the same time as) balancing the interests of diverse stakeholders” (cited in
Tunggal, 2008).
Magnan & Ferrel (2004)
“A business acts in socially responsible manner when its decision and account
for and balance diverse stakeholder interest” (cited in Susanto, 2007)
Milton Friedman
“There is one and only one social responsibility of business-to use its resources
and engage in activities designed to increase its profits so long as it stays within
the rules of the game, which is to stay, engages in open and free competition
without deception or fraud” (Friedman M,1970).
As cited in Staples (2008) CSR can touch on a variety of areas within in a
company’s domain, including areas such as the environment, employee health
and safety and product quality as well as community-based initiatives. All of
these areas can have either a direct or an indirect impact on the communities in
which companies operate. There are basically 2 types of Corporate Social
Responsibility:
a. Internal initiatives are focused on internal processes and primarily result
in benefits to employees and others who may be working or living on-site.
While they often reduce risk and increase quality of life, they do not
typically result in increased brand awareness and favorably impressions
in the larger company
b. External initiatives, however typically create better brand awareness and
relationships in both the local community and the larger community.
Furthermore, Budimanta, Prasetijo and Rudito (2008) conclude that there is
no single definition of Corporate Social Responsibility can be used and applied
globally in all social and cultural contexts. Every country has different progress of
development, culture and political background. From this, we learn there is a lack
consensus of definition of CSR. However, In my point of view, Corporate Social
Responsibility is an effort by corporate and its stakeholders working together
increases the quality of life of the work place and local communities or society in
general, and share responsibilities, risk and respects. Social aspects such as
improving health and education, environmental care and community development
are basically responsible for all
2.2 Corporate Social Responsibility related to Et hics and Laws
If we look at the etymological definition of the term ’company’, it is, like many
contemporary English words, the word company has Latin roots. It is derived
from two Latin words, cum and panis, which mean” breaking bread together”.
Similarly, the terms of “corporate, corporation” which comes from Latin word
means become one body. This term had been used in law practices of Rome
empire era and in European pre modern era means an association for public
services. It is therefore, the original idea of a company/corporate has communal
or social connotation (Asongu, 2007; New Webster’s Dictionary and Roget’s
Thesaurus, 1992; Bertens, 2000).
Three basic types of moral theories in the field of normative ethics have been
developed. First, the utilitarian theory suggests that plans or actions should
produce the greatest good for the greatest number of people. Second, the theory
based on rights holds that all people have basic rights. Third, the theory of justice
demands that decision makers be guided by fairness and equity as well as
impartiality (Weihrich and Koontz, 2005). As cited in Wibisono (2008) in simple
ways we can say a basic ethics includes:
1. Beneficent/to do right things
2. Non malefficience
3. Respect for person
4. Justice, fairness
Four essential components of the human development paradigm based on
Human Development Report (HDR) as quoted in National Human Development
Report 2004 (BAPPENAS,BPS,UNDP;2004)
a) Productivity. People must be enabled to increase their productivity and
participate fully in the process of income generation and remunerative
employment. Economic growth is, therefore, a subset of human
development models.
b) Equity. People must have access to equal opportunities. All barriers to
economic and political opportunities must be eliminated so that people
can participate in, and benefit from, these opportunities
c) Sustanaibility.Access to opportunities must be ensured not only for the
present generations but for future generations as well. All forms of capital-
physical, human, environmental-should be replenished.
d) Empowerment. Development must be by the people, not only for them.
People must participate fully in the decisions and processes that shape
their lives.
Five principles of Good Corporate Governance (GCG) are Transparency,
Accountability, Responsibility, Independency and Fairness, which could make an
acronym as TARIF. CSR is one of implementation concepts of the GCS, where
business is responsible for community and its environment. From good business
ethics, Corporate acts as a good citizen (Wibisono, 2008).
Based on William C Frederick, Keith Davis and James E.Post, Business and
Society, 1988 cited in Weihrich and Koontz (2005), there are some arguments for
social involvement of business and arguments against social involvement of
business.
a. Arguments for social involvement of business:
1. Public needs have changed, leading to change expectation
2. The creation of a better social environment benefits both society and
business
3. Social involvement discourages government regulation and interventions
4. Business has a great deal of power
5. Social involvement maybe interest of stockholders
6. Problems can become profits
7. A favorable public image
8. Business solve problems other institution,bussiness has resources
9. Better to prevent social problems (unemployment) than to cure them
(social unrest)
10. Other books mentioned (social license to operate, reduce risk business,
track record---competitive advantage, access to the market, relationship
to stakeholders, relationship to regulator/government, encourage spirit
and productivity of employee, reward CSR) (Wibisono,2008).
b. Arguments against for social involvement of business:
1. The primary task of business is to maximize profit
2. Social involvement would create exercises cost for business
3. Social involvement can create a weakened international balance of
payment situation added to the price product
4. Business has enough power
5. Business people lack social skill
6. There is a lack of accountability of business to society
7. There is not full support for involvement in social actions
ISO (International Standard Organization) has a working group to make
standardization. ISO 26000 still process and would be launching in October
2008, emphasis: Guidance Standard on Social Responsibility. ISO 9001 (2000)
and ISO 14001 (2004) consist of Standard of Management System and Standard
of Certification (Wibisono, 2008). However, Prof. Alyson Warhurst from University
of Bath United Kingdom, the Business Charter for Sustainability, suggested
principles of CSR namely:
1. Corporate Priority: To recognize social responsibility as among the
highest corporate priorities and as a key determinant to Sustainable
Development, to establish policies, programs and practices for conducting
operations in a socially responsible manner.
2. Integrated Management: To integrate these policies, programs and
practices fully into each business as an element of management in all its
functions.
3. Process of Improvement: To continue to improve corporate policies,
program and social performance, taking into account the latest research
and understanding of societal needs and to apply these social criteria
internationally.
4. Employee Education: To educate, train and motivate employees
5. Prior Assessment: To assess the social impacts before starting a new
activity or project and before decommissioning a facility or leaving a site
6. Products and Services: To develop products an services that have no
undue negative social impact
7. Product Information: To inform and where relevant, educate customers,
distributors and the public in the safe use, transportation, storage and
disposal of products provided, and to apply similar considerations to the
provisions of services.
8. Facilities and Operations: To develop, design and operate facilities and
undertake activities taking into consideration the findings of Social Impact
Assessments.
9. Research: To conduct or support research on the social impacts raw
materials, products, processes, emissions and waste associated with the
enterprise and on the means of minimizing such adverse impacts.
10. Precautionary Principle: To modify the manufacture, marketing or use of
products or services or the conduct of activities, consistent with the latest
research, to prevent undue negative social impacts.
11. Contractors and Suppliers: To promote the adoption of these principles by
contractors acting on behalf of the enterprise, encouraging and where
appropriate, requiring improvements in their practices.
12. Emergency Preparedness: To develop and maintain, where significant
hazard exist, emergency preparedness plans in conjunction with the
emergency services, relevant authorities and the local community,
recognizing potential transboundary impacts.
13. Transfer of Best Practice: To contribute to the development and transfer
of socially responsible business practices throughout the industrial and
public sectors.
14. Contributing to the Common Effort: To contribute to development and to
business, governmental and intergovernmental and education initiatives
that will enhance awareness of social responsibility.
15. Openness to Concerns: To foster openness and dialogue with employees
and the public, anticipating and responding to their concerns about
potential hazards and impacts of operations, products, waste or services,
including those of transboundary or global significance.
16. Compliance and Reporting: To evaluate social performance, to undertake
regular social audits and assessments of compliance with company and
legal requirements and these principles, and make appropriate
information to the Board,shareholders,employees and the public.
(Warhurst, 1998; Wibisono, 2008)
Tom Leader, editor in chief CFO Asia Magazine provided a viewpoint in a
conference about risky business? in Hongkong, espoused particularly strongly by
the economist magazine, which that company money should not be used for
philanthropy, and act better performed by the shareholders themselves using
their dividends. Business should not determine what the social interest, a role
which should be determined by government (CSR Asia weekly, 2006). Indonesia
on the other hand, by law of Indonesia of the Republic of Indonesia Number 40 of
2007, Article 74 concerning Limited Liability of Companies, ratified in Jakarta on
16th August 2007, has declared that:
(1) Companies doing business in the field of and/or in relation to natural
resources must put into practice Environmental and Social Responsibility.
(2) The Environmental and Social Responsibility contemplated in paragraph (1)
constitutes an obligation of the Company which shall be budgeted for and
calculated as a cost of the Company performance of which shall be with due
attention to decency and fairness.
(3) Companies who do not put their obligation into practice as contemplated in
paragraph (1) shall be liable to sanctions in accordance with the provisions of
legislative regulations.
(4) Further provisions regarding Environmental and Social Responsibility shall be
stipulated by Government Regulation.
Thang (2007), on the contrary, comments “….Indonesian lawmakers might
have meant well and seen the good of CSR for society. Making it duty, however,
is likely to discourage investors from Indonesia and thereby hurt the country’s
investment as they might find it better and cheaper for them to do business in
another country where they do not have to deal with this law”. Currently, cost
recovery, the reimbursement of the operational cost handled by government, was
being heated issues and strong debate of many media in Indonesia, examples:
Kompas, Media Indonesia and Antara (2007). The controversy of cost recovery
becomes the talk after findings of the State Comptroller (BPK) and assumed that
there was corruption behind cost recovery claim (Petrominer, 2008; Pane, 2008).
CSR in previous practices included in a cost recovery scheme. Kompas (2007),
however, wrote that CSR should exclude it. The possibilities of CSR actions
depend heavily upon a country’s prevailing economic policy. Until recently, CSR
was primarily a phenomenon found in the United States and the United Kingdom;
continental Europe had not expressed much interest in the concept (Falck and
Heblich, 2007). Papua has been given a special autonomy based on Indonesia
Law Number 21, 2001. Chapter XI article 43 mentions to protect Community
Ulayat right and Chapter XII article 45 mentions to respect human rights
(Tunggal, 2007). Specific explanations were given in Perdasus (Peraturan
Daerah Khusus) .Some of details of selected Perdasus are as follows
mentioned:With the agreement of the DPRP has decided to stipulate: Perdasus
of Papua Province on the Management of Adat Law Community Ulayat Rights.
CHAPTER V: OBLIGATIONS OF THE HOLDER OF ULAYAT RIGHTS Article 14 (1) The adat law community which is authorized to regulate the management of the
ulayat right is obliged to raise the prosperity of its citizens with the benefits of the ulayat right land in an optimal way, both through cooperative efforts with the citizens of its community or by working with other parties.
(2) The holder of the ulayat right is obliged to release the ulayat land which is required by the Government for the general interest with recognition based on the results of a meeting, according with valid statutory regulations.
(3) The holder of the ulayat right is obliged not to hamper the use of water which has a source and flows through the land of its ulayat right for the general interest.
With the Agreement of the MRP Has Decided to Stipulate: Perdasus Papua Province on Special Handling of Isolated, Remote and Marginalized Tribes in Papua Province. Draft Perdasus: CHAPTER I
GENERAL PROVISIONS Article 1 In this Perdasus the meaning of:
1. Majelis Rakyat Papua, hereinafter referred to as MRP, is the cultural representative of the Papua natives, which has a certain authority in protecting the rights of the Papua natives, based on respect of the customs and culture, the empowerment of women, and stabilization of harmony of religious life;
2. Papua Province Government is the Governor and other apparatus as the executive body of Papua Province;
3. Regency/City Government is the Bupati/Walikota and other apparatus as the executive body of the Regency/City;
4. The Governor of Papua Province, hereinafter referred to as the Governor, is the Head of the Region and Head of the Government who has full responsibility for the conduct of government in Papua Province and as the Government Representative in Papua Province;
5. An isolated, marginalized tribe, hereinafter referred to a tribe which is marginalized is a community group originating from Papua which is settled in a certain area which has not yet been touched by development;
6. Participatory Forum is the participation Forum for requesting information in the form of opinions, aspirations and concerns from the public which become materials of consideration in decision-making by the Regional Government.
CHAPTER II RIGHTS OF COMMUNITIES OF MARGINALISED TRIBES Article 2 (1) Marginalized Tribes have the right to benefit from all forms of development
services: education, health, improved nutrition, sanitation, improved settlement, food and clothing and development information, the same as other inhabitants of Papua.
(2) Marginalized Tribes have the right to get continuous construction in every aspect
of life from the Regional Government of Papua Province or Regency/City Regional Governments.
(3) The Papua Province Regional Government is obliged to prepare special access
for Marginalized Tribes for obtaining government services and the results of development and be able to be actively involved in the development process.
Tonkin (1997) argues that the impacts of Freeport mine have depended
largely on the dynamics of a three way relationship between Freeport, the
Indonesian government and the indigenous people. The mine’s significance
stems from its huge profitability both Freeport and for the Indonesia government
and the fact that is located on land inhabited for thousands of years by two
indigenous tribes, the Amungme and Komoro. The inevitable conflicts arising
from the mine’s location are largely rooted in Indonesia laws and policy. This is
an example of same analogy with an expression of disappointment:
“My son Moffet, in the past I put you inside my noken (a woven bag used by
women to carries babies and food), I took you with me wherever I went, but did
not realize that you suck my blood until it is all drained and I remain only bones
without flesh. Now, I pick you out of my noken and will throw you far away”
(Roberth, J cited in Tonkin, 1997)
Plato a great philosopher says that “Good people do not need laws to tell them to
act responsibility while bad people will find a way around the laws “cited in
Wibisono (2007).
2.3 Social Responsibility and Health Issues
The normative context regarding health and social responsibility can be traced
back to many existing international instruments declarations, international
covenants or statements, as well as initiatives, which explicitly refer to health and
welfare of human beings. As cited in IBC Working Group (2007),it is noted that
some initiatives taken of United Nations and other organizations such as
Constitution of the World Health Organization (1948),Universal Declaration of
Human Rights (1948),International Covenant on Economic, Social and Cultural
Rights (1966),Health for All by the Year 2000(1977),Alma Ata Declaration
(1978),Ljubljana Charter (1966), Jakarta Declaration(1977), Bangkok
Charter(2005), UN Millennium Development Goals (2000), UNESCO Universal
Declaration on Bioethics and Human Rights (2005),Global Forum for Health
Research, Grand Challenges in Global Health, Reaching the Poor Program/RPP.
Some initiatives explain below:
Constitution of the World Health Organization (WHO)
WHO defines health as “ a state of complete physical, mental and social well-
being and not merely the absence of disease or infirmity” and affirms that” the
enjoyment of the highest attainable standard of health is one of the fundamental
rights of every human being without distinction of race,religion,and political belief,
economic or social condition”.
Universal Declaration of Human Rights
The Universal Declaration of Human Rights (1948) refers to health and
welfare of human beings in article 25,which state that” everyone has the right to a
standard of living, adequate for the health and well-being of himself and of his
family, including food,clothing,housing and medical care and necessary social
services…”.
Health for All by the Year 2000
In 1977 the Thirtieth World Health Assembly decided that the main social goal
of governments and WHO in the coming decades should be attainment by all
people of the world by the year 2000 of a level of health that would permit them
to lead a socially and economically productive life. However this initiative has not
fully achieved.
Jakarta Declaration
The promotion of social responsibility for health was first established as a
priority at the WHO Fourth International Conference on Health Promotion: New
Players for a New Era-Leading Health Promotion into the 21st Century, held in
Jakarta, Indonesia in July 1997. In the final Declaration, the Conference, the first
to be held in a developing country, and the first to involve the private sectors in
supporting health promotion, recommended that decision makers must be” firmly
committed to social responsibility” and both public and private sectors “should
promote health by pursuing policies and practices” that:
1) Avoid harming the health of individuals,
2) Protect the environment and ensure sustainability use of resources,
3) Restriction production of and trade in, inherently harmful goods and
substances such as tobacco and armaments as well as discourage
unhealthy marketing prices,
4) Safeguard both citizen in the marketplace and the individual in the
workplace
5) Include equity-focused health impact assessments as an integral part of
policy development”
UN Millennium Development Goals
Further international efforts to meet the needs of the poorest, including better
health, have been included in the eight UN Millennium Development
Goals(MDG)(United Nations Millennium Development Goals) adopted by The
General Assembly in September 2000). The UN Millennium Development Goals
address health in a global and social perspective. Indeed, among the
development goals, reduction of child mortality (Goal 4), improvement of
maternal health (Goal 5) and combat HIV/AIDS, malaria and other diseases
(Goal 7) can be found. More over, one of the seven modalities set out to achieve
Goal 8”Develop a global partnership for development” is to provide access to
affordable essential drugs in developing countries with pharmaceutical
companies (as also similarly cited in UN DESA, 2007).
Figure 2. MDG - 8 Ways to Change the World,
Source: Cornielje ,2007
Examples: Corporate Social Responsibility had been/has been implemented in
Indonesia (Tunggal, 2008):a) PT Avon Indonesia: Avon Breast Cancer Crucede;
socialization of prevention of breast cancer)McKinsey & Company: Program for
blood transfusion, c) PT Rio Tinto Indonesia: Tuberculosis control program in
some places in Kutai Barat, East Kalimantan,d) PT Roche Indonesia; Health
village 2003,pilot project in Cisalak,Depok, e) PT Unilever Indonesia Tbk: Public
Health Education Program.
2.4 Corporate Social Responsibility Concepts –Tripl e Bottom Line and
Basic Health/Epidemiological Theory
Triple Bottom Line theory is currently adopted and became a basis of
Corporate Social Responsibility theory. The three lines represent society, the
economy and the environment. Society depends on the economy and the
economy depends on the global ecosystem, whose health represents the
ultimate bottom line. Triple Bottom Line reporting, a term coined by John
Elkington (1997), involves measuring and reporting economic, environmental and
social performance objectives that are practiced simultaneously. In general, it
suggests that Triple Bottom Line reporting involves assessing an entity’s values,
strategies and practices and how these can be utilized to achieve, economic,
environmental and social objectives (Sustainability, 2003) cited in Chapman
(2003), Wibisono (2007).As Carroll (1991) cited in (Toshiba, accessed
07/12/2008), the argument concerned about the Triple Bottom Line (TBL) is very
hot in the studies of Corporate Social Responsibility (CSR) and Socially
Responsible Investment (SRI). It assumes that TBL (balance of profit, planet and
people) legitimates CSR activities. In these arguments, the perspective of CSR
seems to be lack of economical perspective and thought that, but actually the
economical perspective is set up a basic line in CSR. In general, CSR activities
are misunderstood, so CSR activities are regarded as just social oriented
activities. This misunderstanding is caused by emphasing on gaining profits and
its maximization as CSR in neo-classical context. So many scholars tried to get
over neo-classical perspective. In this process, these scholars emphasize on the
social aspects of CSR and regarded economical aspect as only basic line and
weakened its role. The argument on TBL again reminds us the fact that CSR
includes economical perspective. As cited in Norman and MacDonald (2003),
“almost all major corporations at least pay lip service to social responsibility- even
Enron had exhaustive code of ethics and principles- and a substantial percentage
of the major corporations are now issuing annual reports on social and /or
environmental performance. We find controversy not in these assumptions, but in
the promises suggested by the Triple Bottom Line rhetoric. If we believe that
ethical business practices and social responsibility are important functions of
corporate governance and management, then we should welcome attempts to
develop tools that make more transparent to managers, shareholders and other
stakeholders just how well a firm is doing in this regards”.
People (Social)
Profit (Economy)
Planet (Environment)
Figure 3. Triple Bottom Line
If we link between Triple Bottom Line theory and Epidemiology Approach, they
are relevant. Epidemiology is the study of the distribution and determinants of
health related states or events in specified population and the application of this
study to the control of health problem (CDC Atlanta, modified in 2005).
Epidemiological Model describes interactions of important factors of Host, Agent
and Environment ((Kasjono and Kristiawan, 2008; Depkes, 2007; Pradhan,
2003,;CDC Atlanta,2005))
Figure 4. The Epidemiological Triangle
As cited in Kasjono and Kristiawan (2008), Depkes (2007), John Gordon
describes that this model of tree component interactions (host, agent and
environment) predicts a pattern of disease. This model emphasizes analysis and
understanding each component. Host is living things included human being who
can be infected by agent/disease. Intrinsic factors that influence susceptibility of
Agent
Environment
Host
host are Age, Gender, Race, Marriage status, History of illness, behavior, Social
and Economic status, Hereditary, Nutrition, and Immunization. Agents are either
living elements or non living elements which their presences are not expected. If
human being is vulnerable/susceptible, agents with some stimulation can make
people ill. Agents are mentioned for biological agents (bacteria, virus, protozoa),
Chemical agents ( pesticide, waste of industry, food additives),Nutrient agents (
inadequate nutrition ( less or excessive carbohydrate , protein, mineral and
water ) creates imbalance / disease, mechanic agents (friction or trauma
make injury/disease ) and physical agents (radiation, ionization, temperature ,
humidity, tremor, heat, light, noisy may create disease). Environment is a
determinant factor, we divided into 3 groups namely physical environment (air
pollution, season, climate, geographical and geological situation), biological
environment (animals or plants should function as agent, reservoir or vector,
however may be apparently allergen, physical environment (population density,
social stratification, social values and poverty).
To describe the interactions of host, agent and environment, we can simply
illustrate as follows:
Situation is balance where A (Agent), H (Host), and E (Environment) are equal. It
is desirable condition (healthy).
a. If there are changes in Agent (more agents or mutation of agents), then
Host will be weak (ill)
A H
A
H
E
E
b. If changes in Host factors which increase susceptibility to Agents then the
proportion of vulnerable Host will increase (ill).
E
c. If Environment changes it is then increase the spreading of Agents.
Examples: rainy seasons increase of dengue fever and malaria, more
stagnant water makes more breading places of mosquitoes (ill).
.
A
H
E
A
H
d. If Environment changes, it will then increase susceptibility of Host.
Example: increase Acute Respiratory Infection due to air pollution (ill).
In addition, Lalonde (1974) and Blum (1971, 1984) cited Foller M (1992) and
in Monaghan (The Determinants of the Health of the People) accessed on
04/16/2008. This framework contains four determinants namely environment,
heredity, lifestyles, and provider. It has been estimated that 50% of health status
is determined by lifestyles, 20% by environmental factors, 20% by genetics
factors and 10% by medical care system.
A
E
H
Figure 5. Health Determinants
Two pictures below figure 6 and table 1 (Poverty and Health : A vicious Circle
and Top risk factors leading to disease and disability and death) as cited in
Leisinger,2008 show that state of health influenced by basic education for health
awareness, individual and collective poverty, save drinking water, appropriate
habitat, safe and adequate food, life style, access to diagnosis, sufficient health
infrastructure, good governance, freedom from discrimination.
Figure 6 Poverty and Health
Heredity Environment
Health Determinants
Lifestyles (Behavior) Provider
The second table shows risk factors leading to disease, disability even death to
those people who are living in remote place and to those are marginalized
communities as well as those are poor such: underweight, unsafe sex, unsafe
drinking water, indoor smoke, zinc deficiency, iron deficiency, vitamin A
deficiency, tobacco.
Table 1. Top Health Risk Factors
WHO reported that the economic impact of repeated episodes of illness and
long-term disability is a major cause of underdevelopment in many countries to
day? Most deaths from infectious diseases-almost 90% are caused by only a
handful of disease and no more than six deadly infectious diseases-pneumonia,
tuberculosis, diarrhea diseases, malaria, measles and more recently HIV/AIDS-
account for half of all premature deaths killing mostly children and young adults.
On the other hand, leprosy, lymphatic filariasis and yaws are examples of
diseases which make people disabled (WHO, 1999). The interrelationship
between health and development are so intertwined, that it is impossible to
address one without the other. Improvements in community health depend on
sustainable development. At the same time, health is a minimum requirement for
development. Good health is at the heart of poverty alleviation (WHO, 1999). The
interrelationship between the state of poverty and the state of health says in a
simple way” Men and women were sick because they were poor, they become
poorer because they were sick, and sicker because they were poorer” as
Winslow, 1951 cited in Leisinger (2008). In addition, Dr Samlee Plianbangchang
(WHO, 2007) an inaugural book addressed that leprosy, lymphatic filariasis, kala-
azar and yaws diseases primarily affect the poorest of the poor as well as
vulnerable groups like women, children and marginalized populations.
In relation to workplaces and community, this is an example: DOTS (Direct
Observed Treatment Short Course) reduces the impact of TB on workers and
their families. A diagnosis of TB has serious impact on the worker. It implies
prolonged illness, frequent periods of absenteeism from work, loss of wages,
sometimes even loss of job and other forms of discrimination. At the same time,
TB spreads easily from untreated worker to other employees. It has been
estimated that the most infectious form of TB will infect about 20 others in his or
her life time. Family members also suffer. Apart from being at a higher risk of
getting infected due to close contact with the infected case at home, a reduction
in household income adversely affects the health and well being of the family. For
example, children in TB affected families are known to be withdrawn from school
to supplement household incomes. When TB affects women workers, the impact
is even greater. Women generally have poorer accessibility to health services,
face greater discrimination and get lesser family support in times of illness. In
addition, people who suffer from disease such as TB and HIV/AIDS and others
like leprosy and lymphatic filariasis more likely continue to carry stigma and
shame in many societies (WHO, 2003).
As cited in Dinkes Papua (2007), Vision of health development in Papua is
“Kampung Sehat Menuju Papua Baru Sehat 2011” means healthy village will be
a target in 2011. Health centers are a basis of health development and have to
empower community until village level. Communities who are living in very
remote and isolated areas; remote islands and mountains; along borders and
coastal areas are worthy should be addressed. Companies which operate in the
remote place and its CSR are highly appreciated and maybe help for health
acceleration and development.
2.5 Corporate Social Responsibility Implementatio ns and Stakeholder
Interactions
The role of stakeholder is a very old concept in law. A stakeholder was
originally a person who temporally holds money or other property while its owner
is being determined. However in the last decades of the 20th century, the world
”stakeholder” has become more commonly used in management to mean a
person or organization that has a legitimate interest in a project or entity
(Wikipedia ,accessed on 1/20/2008)
Stakeholder view theory
Stakeholder theory is important in building CSR, we should know different
group of stakeholders and their roles. Freeman in 1984 originally defines
Stakeholders as “any group or individual that can be affected by the realization of
a company’s objectives”. For Donaldson and Preston in 1995 as cited in Weiss
accessed in Google.com on 8/16/2008, Stakeholder Theory posits a model of the
enterprise in which “ all persons or groups with legitimate interests participating in
an enterprise do so to obtain benefits, and there is no prima facie priority of one
set of interests and benefits over another”. Post, in their theory called
Stakeholder view, use the following definition of the term "stakeholder": "The
stakeholders in a corporation are the individuals and constituencies that
contribute, either voluntarily or involuntarily, to its wealth-creating capacity and
activities, and that are therefore its potential beneficiaries and/or risk bearers."
This definition differs from the older definition of the term stakeholder in
Stakeholder theory by Freeman that also includes competitors as stakeholders of
a corporation. Robert Phillips provides a moral foundation for stakeholder theory
in Stakeholder Theory and Organizational Ethics. There he defends a "principle
of stakeholder fairness" based on the work of John Rawls, as well as a distinction
between normatively and derivatively legitimate stakeholders” (Wikipedia,
accessed on 1/20/2008). As cited in Pesquex and Damak-Ayadi ( 2005),
Caroll,1989 distinguishes between primary stakeholders and secondary
stakeholders. ”Primary” stakeholders, referring to those actors who entertain a
direct and contractually determined relationship, as the name indicates with
company. ”Secondary” stakeholders, combining actors who are situated at the
borders of a firm and who may be impacted by its actions without having any
contractual connection to it. Clarkson (1995) in Peruniĉić and Alexandrova (2007)
says, there is a clear difference between primary stakeholder group and
secondary one. His research includes owners (investors), employees, customers
and suppliers and the public stakeholders group, such as the communities into
the primary stakeholder group. The secondary stakeholder groups are media and
other interests groups.
Figure 7. Stakeholder View by Ricklies (2001)
Source: Peruniĉić and Alexandrova, 2007
In order to build a CSR strategy based on change of a stakeholder’s action, it
is necessary to grasp periodically the consciousness of a stockholder, a
customer, an employee, supplier and change of a sense of values. For that
purpose, a dialog with a stakeholder is an effective means. This is not only
hearing opinion of a stakeholder, but making use of in management.
Manager Owners
Local Communities
Employees
Suppliers Costumers
Associations and organizations
Environment Group
Press/ Media
Government
Public Authorities
Unions
Communication with a stakeholder is very crucial (Toshiba, accessed on
07/12/2008)
Figure 8. Stakeholder Relations
As cited in Knox and Maklan (2004), Clarkson in 1995 identified some
problems after 10-year study of CSR and he concludes that researchers should
concentrate on how firms actually manage their stakeholder rather than upon
empirically validating inherently untestable frameworks of social responsiveness.
Koestar (2007) describes about experiences of Indonesia that
“in developing their CSR programs, companies need to stay a breast of the
public’s evolving opinion on corporate roles and responsibilities. It is the scenario
we often see to day, where companies (with a genuine responsible attitude) are
struggling to find the right balance between “doing better” and “responding to
criticism”. The problem is that public perception of CSR varies among different
stakeholders (government, private sectors, NGOs). Some people perceive CSR
as an obligation for large companies only and suggest that it is not applicable to
small companies because they cannot afford it”. In addition Munila and Milles
(2005) said that “It is likely that least sustainable possible position for
stakeholders along the CSR continuum is the forced CSR perspective, where the
firm is pressured into making expenditures that go beyond compliance or
strategic, and that the firm perceives are not in the best interest of the majority of
its stakeholders”.
Kolk and Pinkse (2006) in “Stakeholder Mismanagement and Corporate
Social Responsibility Crisis” reported two studies (Ahold and the Dutch building
industry involving business that have gone through a severe integrity crisis, while
a taking place in a country of Netherlands well known for its stakeholder-oriented
‘Polder Model’. Various stakeholders groups saw their basic interests violated in
both cases. This paper also mentions that the series of recent corporate social
responsibility scandal (e.g. Enron, WorldCom, Vivendi, and Parmalat) have failed
to take care of various stakeholder interests and some of them have actually
been able to neglect stakeholder’s demands for a fairly long period of
time.(Wikipedia, accessed on 07/23/2008) the world ‘Polder Model’, is actually
come from the verb”polderen” (English to polder) has been used pejoratively by
some politician to describe the slow decision making process, where all parties
have to be heard.
Knox and Maklan (2004) in their paper “Corporate Social
Responsbility:Moving Beyond Investment Towards Measuring Outcomes” studied
for 6 selected firms: Orange(UK),Diageo PLC,Pilkington PLC,Unisys, Company X
(a global software vendor) and Company Y(an IT service provider) the rest of two
companies opted to remain anonymous by name. Even though it was found that
companies feel responsible for communities impacted by their core business and
are clear on their most important stakeholders. It is how ever companies are less
able to set priorities among the rest. Other problems are social outcomes need
more formal assessment; risk management is not fully integrated with business
activities; stakeholder’s behaviors, not only attitudes, count to drive revenue and
cost; and business attitude to CSR reporting is paradoxical. Warhurst (1998)
suggests systematic stakeholder mapping working through participatory methods
to gauge and evaluate local and remote stakeholders concerns. The number of
stakeholders is growing and there is an urgent need for methodologies to define
the extent of their representativeness and to identify priorities and relative
importance with different projects/activities.
For the last decades, stakeholder theory has become a central discussion
point in management science as well as in the field of managerial practice.
However, Stakeholders theory has also been debating and receiving critiques
(Lépineux,2005; Antonacopoulou and Méric,2005; Mahoney,2005; Key,1999;
Jensen,2000; Weiss accessed in Google on 8/16/2008) . According to Lépineux
(2005) stakeholder theory is a weak theory which suffers from a number of flaws.
The fact of the stakeholder theory fails to appreciate the place of civil society as a
stakeholder. Stakeholders theory is affected by some shortcomings and
imperfections, for instances: the definition of its object is controversial; the
spectrum of stakeholders and their classification area variable; the question of
the balancing of interests between them is a problematic one; the theory lacks a
solid normative foundation; and its normative and empherical streams are, to a
large extent , separate. Weiss accessed in Google on 8/16/2008 there are cracks
in conceptual and empherical foundation on which it rests. These flaws weaken it
and mask some of its implications. They suggest that stakeholder theory is based
on a limited analysis of the relationship of business activity to the institutional
structure of modern capitalist society. It understates the need for fundamental
structural change if the interests of stakeholders are to become integral to the
operation of the enterprise. The cracks in the foundation of the theory can be
questioned concerning the utility and validity of any moral conclusions or
prescriptions it offers. Antonacopoulou and Méric,2005 say that there are some
of the internal contradictions between ,on the one hand, the ideology of social
good, on the other hand, the ideology of control which they argue is not fully
accounted for in the way stakeholder theory was popularized in recent years.
Jensen (2000), there is a dilemma: between a desire to maximize the value of
their companies and the demands of stakeholder theory to take into account the
interest of all the stakeholders in a firm. Value maximizing tells the participants in
an organization how they will asses their success in achieving a vision or in
implementing a strategy, but value maximizing says nothing about how to create
a superior vision or strategy and value maximizing also says nothing to
employees or managers about how to find or establish initiatives or ventures that
create value. Mahoney (2005) says a shareholders wealth perspective is
increasing unsatisfactory for accurately answering the two fundamental questions
concerning the theory of the firm: that of economic value creation and distribution
of this economic value. Examining the corporation from a property rights
perspective of incomplete contracting and implicit contracting provides a
foundation for the revitalization of a stakeholder theory of the firm in strategic
management discipline. Key (1999) comments that stakeholder theory as it is
currently formulated for lacking sufficient theoretical content. She adds a theory
without context and causal laws to explain process does not meet requirements
of theory. These elements must be added as part of the next step towards the
creations of stakeholder theory.
Freeman et al (2004) in their paper of “Stakeholder Theory and the Corporate
Objective Revisited “ response the critiques for stakeholder theory for instance
from Sundaram and Inkpen. Freeman et al argue that stakeholder theory begins
with the assumptions that values are necessarily and explicitly a part of doing
business. We should understand capitalism as creating value for stakeholder:
1. The goal of creating value for stakeholders is decidedly pro-shareholder.
2. Creating value for stakeholders creates the appropriate incentives for
managers to assume entrepreneurial risks.
3. Having one objective function will make governance and management
difficult if possible.
4. It is easier to make stakeholders out of shareholders that vice versa.
5. In the event of a breach of contract or trust, shareholders, compared with
stakeholders, have protections through mechanisms such as the market
for shares. Freeman also considers shareholder concerns and
stakeholders concerns is roughly the logical equivalent of contrasting “
apples” and “fruit”. Shareholders are stakeholders.
The common starting point of the CSR program was company’s vision and
values which had usually developed on a normative basis. Corporate vision and
values co-evolved with corporate reputation/brand and the behavior of its
employees. There was full agreement that CSR program favorably enhance
corporate reputation and to some extent could influence employee behavior.
Thus, it was felt that once CSR is “embedded” in their employees’ attitude to
stakeholders and through listening and responding to stakeholder concerns, their
business would automatically act more responsibly, have a greater
understanding of the risks in its environment and strengthen its corporation
reputation (Knox and Maklan ,2004),please see figure 9.
Figure 9. Framework CSR linking with Outcomes
Source: Knox and Maklan ,2004
Communication is very crucial to deal with stakeholders as mentioned in the table
2.
Table 2. Stakeholder model on communication by Gru nig and Hunt
The Stakeholder Information Strategy
The Stakeholder Response Strategy
The Stakeholder Involvement Strategy
Communication Ideal (Grunig & Hunt 1984)
Public Information, one-way communication
Two-way asymmetric communication
Two-way asymmetric communication
Communication ideal : sense making and sense giving
Sense giving Sense making
Sense giving
Sense making
Sense giving—in iterative progressive processes
Stakeholders: Request more information on Corporate CSR efforts
Must be reassured that company is ethical and socially responsible
Co-construct corporate CSR efforts
Stakeholders roles: Stakeholder influence: support or oppose
Stakeholders respond to corporate actions
Stakeholders are involved, participate and suggest corporate actions
Identification of CSR focus:
Decided by top management Decided by top management, investigated in feedback via opinion polls, dialogue , networks and partnership
Negotiated concurrently in interaction with stakeholders
Strategic Communication task:
Informs stakeholders about favorable corporate CSR decisions and actions
Demonstrate to stakeholders how the company integrates their concerned
Invite and establish frequent, systematic and pro-active dialogue with stakeholders i.e. opinion makers, corporate critics, the media.
Corporate Communication Department’s task
Design appealing concept message
Identify relevant stakeholders Build relationships
Third-party endorsement of CSR initiatives
Unnecessary Integrated elements of surveys,rangkings and opinion polls
Stakeholders are themselves involved in corporate CSR messages
Source: Morsing and Schultz, 2006
Aguilera et al (2007) argues some social change regarding CSR can be made
by employees, stakeholders, government and NGOs as figure 12. Employees
with his/her increasing perceptions about CSR pressure increase level of CSR
and organizational commitment through employee participation, job satisfaction,
leadership, employee citizen ship and performance. Some CSRs are proposed
for community development including employees and their families.
Stakeholders/stockholders with increasing awareness about CSR drive increase
of CSR through strategic decision and collective action. Government gives
regulations enforcing CSR and NGO/ community push with campaign, multiparty
dialogues or in extreme way with boycotts.
Figure 10. Actors’ Mechanism to Influence Social C hange
Multiples motives (instrumental, relational and moral) and relationship of the
actors are pushed to make the social change happened see table 3.
Table 3. CSR motives at Multiple Levels of Analysis
Source: Aguilera et al ,2007
Alizar, Rahadini and Love (2008) in their paper of Engaging Local
Government in Promoting Good CSR Practices and Sustainable Development
through Multi-Stakeholder Engagement, based on experience in Musi Banyuasin
Regency and East Kutai Regency, Indonesia. There are four main steps to
develop accountable and sustainable engagement initiatives:
1. identify the stakeholders, what their interest are, and how they work;
2. develop an appropriate stakeholder engagement model;
3. set up a stakeholder institution through a participatory process; and
4. develop plans of action to meet sustainability challenges
Possible conflicts dealing with stakeholders in CSR if not well managed may
be relevant with a theory of Drama Triangle.
Figure 11. Drama Triangle
Source: Orriss ,2004
“The drama triangle is a psychological and social model of human interaction in
transactional analysis ("TA") first described by Stephen Karpman in 1968, which
has become widely acknowledged in psychology and psychotherapy. The model
has three habitual psychological roles (or role-plays) which people often take in a
situation:a)The person who is treated as, or accepts the role of, a victim ; b)The
person who pressures, coerces or persecutes the victim and c) the rescuer, who
intervenes out of an ostensible wish to help the situation or the underdog (Note
that the rescuer role is one of a mixed or covert motive, not an honest rescuer in
an emergency).In implementing CSR, every actor/stakeholder must aware of
his/her own roles otherwise as the drama plays out, people may suddenly switch
roles, or change tactics, and others will often switch unconsciously to match this.
For instance, the victim turns on the rescuer, or the rescuer switches to
persecuting. The covert purpose for each 'player' is to get their unspoken
psychological wishes met in a manner they feel justified, without having to
acknowledge the broader dysfunction or harm done in the situation as a whole.
As such, each player is acting upon their own selfish 'needs', rather than acting in
a genuinely adult, responsible or altruistic manner” (Wikipedia accessed on
04/04/2008).
In strengthening the team work (working with multi -stakeholders), Moeljono
(2008) argues a strategy of cohesiveness: First, a basic strategy contains vision,
mission and values. Vision ensures anybody knows the target should be
achieved in the certain period. It ensures anybody in the team knows what they
have to do to reach the goal. Mission explains reasons of existence of the
organization (raison d’etre).The mission should be simple or understandable, and
communicable to others. Values is a corporate culture that can be implemented
and developed as well as functioned as a cohesive system. This could be guided
to, how to do and how to attitude. Second, an operational strategy consists of
developing the winning people (competitive human resources) and developing
the winning team (the team are able to work). Third, develop a negative strategy
if necessary we called it common enemy and virtual enemy. This aims to make
people anxious and wake up to fight together towards the making enemy. This
always makes them alert as the making enemy will attack them.
Muriel James and Dorothy Jongeward cited in Moeljono (2008) introduce a
concept of the winning people in their book “Born to win”. They suggest that the
winners are the following criteria1)Winner does not mean who make someone
else lose. To us a winner is one who responds authentically by being credible,
trustworthy, responsive, and genuine, both as an individual and as a member of a
society.2) Winners are they who able to love and to be loved. A winner cares
about the world and its people 3) A loser is a dependant one; therefore they
mostly fail to become a member of interdependence.
Figure 12. Strategy to develop cohesiveness
Moeljono (2008) says that to develop a corporate alignment with valid human
resources should consider namely skilled people, well rewarded people,
innovative people and sufficient number of people.
Similar Mission, Vision and Values
Develop the winning people and the winning team
Develop Common Enemy and Virtual Enemy
Figure 13. Aligned people,
Source: Moeljono ,2008
In operation of CSR management, it is important the company involved with
stakeholders to make continuous development. It is required for practice of CSR
to build the structure of PDCA (Plan-Do-Check –Action) during activities,
implementation and eventually achieve commitment as cited in Toshiba
(accessed on 07/12/2008). It is applied of the grand theory of Walton and Deming
(1986), or PDSA cycle, refers to logical sequence of four repetitive steps for
continuous improvement and learning: Plan, Do, Check (also known as study)
and Act (or Action).Many organizations are unable to specify objectives, activities
and desired results, let alone to systematically and consistently manage their
own improvements, Deming cycle or not. Several adaptations of the Deming
Aligned people
Well Rewarded
People
Innovative People
Sufficient number of
People
Skilled People
cycle for instances: Plan can be split up into: determine goals and targets, and
determine methods of reaching goals. Do can be split up in training and
education as well as implementation (ten Have et al, 2003).
Figure 14. CSR Management system Toshiba
In relation to continuous improvements, Tyagi (2000) cited in Wibowo (2007),
argues that a model of change by Lewin is too general with 3 stages namely
unfreezing, freezing and refreezing, and has not addressed some important
issues yet. Lewin model has been used by many researchers to develop other
models. Tyagi however gives system approach and change in organization
more comprehensively. They are forces for change, recognize define problem,
problem solving process, implement the change and measure, evaluate, control.
Figure 15. Model of Changes by Tyagi
Source: Wibowo, 2007
Arena (2008) wrote a book about the high purpose company and argued that
there is a spiral of changes when a company faces facts. The companies which
had strong commitment for doing the best, usually reflected in the corporate
responsibilities for their behavior and actions. The high – purpose company is a
new trend in responsible business world and high profit companies as her study
of 75 big companies. In addition, Arena says that the process to be the high
purpose company is gradual and it is relevant to some theories such as biology
(Darwin), psychology (Maslow), business (Collins), philosophy (Wilber) and
religion (Buddha).
1. Forces for Change
2. Recognize Define Problem
3. Problem Solving Process
Change Agent
4.Implement the Change
Transition Management
5. Measure, Evaluate, Control
Table 4. Progress of the high purpose company
Basic
Level
The high
purpose
company
(Arena)
Biology
(Darwin)
Psychology
(Maslow)
Business
(Collins)
Philosophy
(Weber)
Religion
(Buddha)
1 Awareness New
Condition
Self -
esteem
Discipline
cognition
identification Karma
2 Integration Adaptation Self -
exploration
Discipline
acts
differentiation Samsara
3 Transformation Evolution Self -
actualization
Great
company
inclusion Nirvana
Source: Arena, 2008
John Kotter (1990) studied about over 100 companies going through change
process. His theory is “Kotter’s eight phase of change” cited in ten Have et al
(2003) as follows:
1. Establishing a sense of urgency (research market; analyze competition;
identify and discuss (potential) crises and opportunities).
2. Creating a coalition (for a powerful and influential group to lead the
charge; align this guiding coalition to work like a team).
3. Developing a clear vision (creates a vision to direct the change effort;
develop strategies to realize the vision).
4. Sharing the vision (use every possible way to communicate the new
vision and strategies; let guiding coalition members be role models for the
rest of the organization).
5. Empowering people to clear obstacles (get rid of obstacles; change
structures and systems that obstruct the change effort; encourage risk
taking and non traditional ideas, activities and actions.
6. Secure short-term wins (plan for visible performance improvements;
create and declare the wins; visibly recognize and reward those who
made the wins possible).
7. Consolidate and keep moving (build on going credibility to gradually
change all systems, structures and policies that do not fit the vision; hire,
promote and develop successful changers; reinvigorate the change
process with new projects, themes and change agents).
8. Anchor (improve performance through customer and productivity
orientation, and more effective leadership and management).
Similarly, Barenschot (1991) as cited in ten Have et al (2003) argues that many
change process fail in the absence of urgency, vision, infrastructure, know-how,
and coordination. His theory of “The seven forces model” that makes things
happen is as follows:
a) necessity - a shock to break the inertia and to create a sense of urgency
b) Vision- specific images in order to make people ‘see’ what are requested
of them.
c) Success- early success that creates a sense of confirmation the new way
is ‘better’.
d) Spirit- the power and strength to initiate and maintain a high level of
commitment.
e) Structure- structural support at organizational level to challenge people,
as well as to endorse the change.
f) Capabilities – knowledge, skills and empowerment to balance the new
task and responsibilities
g) Systems - information, reviews and rewards to close the loop and confirm
desired performance.
Both theories from Kotter and Barenschot are important and mutually strengthen
in making a change and minimize conflicts especially there are various
stakeholders.
2.6 Corporate Social Responsibility - Competitive A dvantage
Before we discuss about competitive advantage, lets we see the environment
of organization. It is important to diagnose organizational capability, strength and
weakness. We identify few important trends and issues to which the organization
is particularly vulnerable. Understanding change and staying alive with all
components (customer/markets, suppliers, economy, employee, shareholders,
technology, social trends/community etc), this is the rules of engagement are
defined (Clarke, 1994).
Figure 16. Scanning the business environment
Source: Clarke, 1994
Merali and McGee in Hamel et al (1998) argue a framework of the success
of the headquarters in promoting generative corporate learning: a) Its openness
and ability to learn from the external and corporate environment and b) Its ability
to promote learning across the business. In order to learn from its context the
headquarters needs to have the requisite competence bases required to: modify
its self –script: this involves the revision of purpose, behaviors and
appropriateness values; update its mental map in a dynamic fashion: this
involves dynamic acquisition and internalization of knowledge about the things;
develop appropriate business relationship scripts: this involves the provision of
appropriate structure/formalization /normative context; establish mechanism for
acquiring external information directly from the environment and through inter-
organizational networks. In addition, Nonaka and Takeuchi cited in Merali and
Technology
Employees
Social trends
Economy
Supplier
Markets/ Customers
Shareholders
Organization
McGee (1998) in dynamic, uncertain context, there is a great emphasis on the
importance of learning, innovation and knowledge creation. Please, see figure 18
as below.
Figure 17. The headquarters and learning
Source: Merali and McGee, 1998
Porter’s competitive advantage theory sees five major influences on a firm’s
ability to compete compromising not only existing competitors, but also potential
rivals(new entrants),threat of substitute products, the bargaining power of buyers
and the bargaining power of supplier (Porter :2004,2006;Cole :2005) . Hofel and
Schendel (1986) cited in Cole (2004) who are particularly interested in the
adaptations that successful firms make with their environment (survival of the
fittest) compared with unsuccessful firms. They concluded that when firms adapt
Learning at
business
Environmental scanning
Learning at
headquarters
to events in their external environment, the results are more likely to make an
impact on effectiveness whereas when they adapt their structures and ways of
working (i.e. responding to the external environment), the impact is more likely to
be felt on efficiency. To day managers are mostly interested in efficiency, but so
far as strategic management is concerned it is effectiveness that is the more
important, this implies attention to the external environment.
Martin (2002) quoted in Munilla and Milles (2005) found that
“…executives who wish to make their organization better corporate citizens face
significant obstacles. If they undertake costly initiatives that their rivals don’t
embrace, their risk eroding their competitive positions. And if they invite
government review, they may be hampered by costly regulations that impose
onerous cost without generating meaningful societal benefits in return”.
Tsoutsoura (2004) says that most people identify certain benefits for a
business being socially responsible, but most of these benefits are still hard to
quantify and measure. The source of the connection between CSR and
profitability has rarely been systematically investigated. Knox and Maklan (2004)
ask how the companies know how much to invest in CSR versus the other
demands for resources.
Competitive Advantage starts the concept of the value chain, a general
framework for thinking strategically about the activities involved in any business
and assessing their relative cost and role in differentiation. The difference
between value, that is, what buyers are willing to pay for a product or service,
and the cost of performing the activities involved in creating it, determines profits.
The value chain provides a rigorous way to understand the sources of buyer’s
value that will command premium price, and why one product or service
substitutes for another. A strategy is an internally consistent configuration of
activities that distinguishes a firm from its rival (Porter, 2004).
Furthermore, Porter and Kramer (2006) in Mapping Social Opportunities
describes that the interdependence of a company and society can be analyzed
with the same tools used to analyze competitive position and develop strategy.
These two tools should be used in different ways. When a company uses the
value chain to chart all the social consequences of its activities, it has, in effect,
created an inventory of problems and opportunities-mostly operational issues-
that need to be investigated, prioritized, and addressed. In general, companies
should attempt to clear away as many as negative value chain social impacts as
possible. Some companies’ activities will prove to offer opportunities for social
and strategic distinction. In addressing competitive context, companies cannot
take on every area in the diamond. Therefore, the task is to identify those areas
of social context with the greatest strategic value. A company should carefully
choose from this menu one or a few social initiatives that will have the greatest
shared value: benefits for both society and its own competitiveness. The
illustrations of its competitive advantage are written: first, Looking Inside Out:
Mapping the Social Impact of the value Chain and second, Looking Outside In:
Social Influences on Competitiveness.
In a simple way, Hill and Jones (2004) explain that it is important to keep in
mind the relationships of functional strategies, distinctive competencies,
differention, low cost, value creation and profitability. The distinctive
competencies shape the functional-level strategies that a company can pursue
and that through their choices with regard to functional-level strategies,
managers can build resources and capabilities that enhance a company’s
distinctive competencies. The ability of a company to attain superior efficiency,
quality, innovation and customer responsiveness will determine if its product
offering is differentiated from that of rivals and if it has a low cost structure. Recall
that companies that increase value through differentiation, while simultaneously
lowering their cost structure, create more value than their rivals, and his leads to
a competitive advantage and superior profitability.
Figure 18. The roots of Competitive Advantage
Source: Hill and Jones, 2004
Functional Strategies Superior:
• Efficiency • Quality • Innovation • Customer
responsiveness
Differentiations
Capabilities Low Cost
Resources
Distinctive Competencies
Value Creation
Superior Profitability
Shape
The concept of scale economies shows in figure 19. A, as a company
increases its output, unit costs fall. This process comes to an end at an out put of
Q1, where all scale economies are exhausted. Indeed, at outputs of greater than
Q1, the company may encounter diseconomy of scale, which are the cost
increases associated with a large scale of output. Diseconomies of scale occur
primarily due to the increasing bureaucracy associated with large-scale
enterprises and the managerial inefficiencies. In figure 19.B, learning effects are
cost savings that come from learning by doing. Labors, for instance learn by
repetition how best to carry out a task. There fore, labor productivity increase
over time and unit cost fall as individual learn the most efficient way to perform a
particular task. Equally, management in new manufacturing facilities typically
learns overtime how best to run the new operation. It also means someone or
organization which directly involved in a particularly repeated activities, they will
know how to do more efficiently (Hill and Jones, 2004). Making the CSR of this
study as integrated health programs and learning from several surveys has
contracted it into economies of scale.
.
Figure 19. A Economies of Scale and Diseconomies o f Scale and Figure B the Impact of Learning and Scale Economies on Unit Costs Source: Hill and Jones, 2004 Kotler and Pfoertsch (2008) say future trend emphasizes Corporate Social
Responsibility and Design as important developments to change and redefinition
of management brand.
Unit Cost
Economies of Scale Diseconomies of Scale
Economic of Scale A
B
Learning Effect
Time 1
Time 2
C
Output Output Q1
Unit Cost
A B
Table 5.Classification of common success factors
-Economic growth
-Liquidity
-Product/service costs
-Profitability
-Delivery time -Quality of products -Production volume -Productivity -Stock turn time -Service volume
-Brand value
-Goodwill
-Value of immaterial
properties
-Competencies
-Customer satisfaction
-Customer retention
-Innovation
-Motivation
-Personnel satisfaction
Source: Lönnqvist, 2002
Blumenthal and Bergstrom cited in Guzmán accessed on 5/4/2009 say both
branding and CSR have become crucially important that organizations have
recognized how these strategies can add from their value. They then expose four
key reasons for integrating CSR under the umbrella of the brand which are;
recognizing the magnitude of the brand promise; maintaining customer loyalty;
Success Factors
Financial Non- financial
Success Factors
Intangible
Tangible
maximizing investment that would be placed in CSR regardless of the brand; and
avoiding conflict with shareholders. In simple words, branded CSR turns
philanthropy from implicit delivery of the promise to an explicit one. Furthermore,
Antti Lönnqvist (2002) says most of the financial success factors are tangible in
nature since many of them represent monetary values related to an
organization’s results. However, some financial factors can also be considered as
intangible for instance, value of brand is a financial phenomenon. However, the
brand itself is intangible and immaterial assets. Intangible assets consists of the
immaterial sources of value related to employee’s capabilities, organizations’
resources and way of operating and relationships with its stakeholders. The term
intangible success factors are used to refer to: a) Managerially relevant intangible
assets and b) Activities related to improving or utilizing the assets.
CSR is considered as a social capital. Halperen, 2005 notes social capital
refers to the institutions, relationships, and norms that shape the quality and
quantity of a society’s social interactions. Increase evidence shows that social
cohesion is critical for societies to prosper economically and for development to
be sustainable. Social capital is not just the sum of the institutions that
strengthen a society. It is the glue that holds them together. The earliest specific
use of the term’ social capital’ identified by Putnam (1998) and seems to have
been by Hanifan (1916). He used the term to refer to ‘those tangible assets that
count for most in the daily lives of people: namely goodwill, fellowship,
symphathy, and social intercourse among individuals and families who make up
a social unit. In addition, Harperen says there is relationship between social
capital and economic growth.
Figure 20. The causal relationship between social c apital and economic growth Source: Harperen, 2005
Social capital plays in improving the flow of information through an economy and
generally lowering transaction costs. Social capital may have indirect positive
effects on the economy, such as by encouraging the development of a legal and
public policy environment that further reinforces trust and is conducive to long-
term human and physical investment.
Leisinger (2008) argues the following model is intended to facilitate
systematic analysis of corporate access to medicine obligation. It distinguishes
three degree of corporate obligation namely: The “must”(essential) dimension-
non negotiable essential incumbent on the respective industry by social
consensus; the “ought to” (expected) dimension-good corporate responsibility
standards particularly relevant in sensitive business areas, or countries where the
Networks: Bridging especially
Sanctions: Exclusions & shaming for default
Norms: Co-operation & trust
Reduced transaction costs
Better flow of information Mutual support & co-operation,honoured contracts Agreements easily & cheaply enforced
Investment in public goods
Factors conducive to economic growth
Innovation Enterpreneurlism & risk-taking Investment & trade Effective Competition Efficient allocation of resources
quality of the law is sufficient or inadequately enforced; the “can”(desirable)
dimension-voluntary assumption of additional responsibility according to capacity.
The must and the ought categories are good management practices, and the can
category is corporate social responsibility excellence. The can category is for
instances: differential pricing-i.e. reduced tenders for selected drugs against
poverty related and tropical diseases for use in least-developed countries,
donations for disease eradications program/emergencies, support for broader
health and development goals, work with stakeholders in countries of operation
to ensure access to medicine.
Figure 21. The Hierarchy of Corporate Social Respo nsibility
Source: Leisinger, 2008 Prof.Ki-Hoon LEE (accessed on 03/13/2008), divided 3 categories of corporate
Nice to have (can)
Enlightened Self-interest (ought to)
Essentials (must)
Corporate responsibility
excellence
Good management
practices
Corporate Philanthropy
CSR beyond legal duties
(wise strategic decisions)
Make profit and comply with applicable low and
regulation
The Hierarchy of Corporate Responsibilities
commitment for CSR: First, laggard type in term of CSR management where top
executive views CSR issues as a serious regulatory burden or threat. Therefore,
a company this type tries to meet the minimum level of regulatory legislation.
Second, fire-fighter category where this category, a company comply with
legislation however avoiding extra cost. In this case, top executives do not see
CSR issues as new opportunity. Third, limbo or champion. The main
characteristic of these companies is related to seeking new business
opportunities through CSR management. In short, to them achieving leadership
and a competitive edge in CSR management will bring to better social,
environmental and financial performance. Brammer, Millington and Rayton
(2005)an employee attitude survey of a large retail banking service firm in the
United Kingdom to see “The contribution about Corporate Social Responsibility
to organizational commitment”, based on relationship between organizational
commitment and CSR within a model which draws on social identity theory and
distinguishes between the importance of CSR for male and female employee
found that external CSR (image and reputation) is positively related to
organizational commitment and provided at best an indirect benefit to employees.
The external CSR offers indirect benefits to internal stakeholders through
organizational commitment, procedural justice and training provision are both
seen to contribute positively to organizational commitment, and women may
show stronger preferences for external CSR and procedural justice while men
have stronger preferences for training provision.
CHAPTER THREE
CONCEPTUAL FRAMEWORK
A conceptual framework is designed based on a research paradigm (basic
sets of beliefs that guide actions). This framework is generated from the
numerous theories and the empherical data backgrounds which have already
been discussed in the literature review (chapter two) and in the introduction
(chapter one). Trenton Haack, cited in Malhotra (2004) says “No matter how well
you design the research process, the persons actually doing the work have
control of the quality. The key to good fieldwork is founded in careful selection,
through training and continuous evaluation... always with an eye to quality”.
Source: Salladien, 2008 Figure 22. Research Paradigm
Research Focus
Theory A Theory C
Theory E
Theory G
Theory H
Theory B
Theory D
Theory F
77
In a qualitative study, references must be consistently used it according to its
methodology and learn inductively which indirectly answer the research questions
(Salladien, 2008). The importance of using references is relevant to the analytic
strategy of the Grounded Theory which have three concurrent stages: Stage 1:
familiarization, Stage 2: coding, conceptualization and ordering, and Stage 3:
enfolding literature (Mehmetoglu and Alinay (2006).
Based on research problems (1) How to generate a model of CSR in remote
area during gas exploration phase (uncertainty condition which is at risk to fail)
where the philosophy of Triple Bottom Line and the needs between company and
its stakeholders (government and society) are appropriately addressed? (2) How
to implement CSR during gas exploration phase that is more cost effective,
transparent as well as sustainable or sound competitive? I therefore would like to
summarize some grand theories and empherical data which will be used in
developing the conceptual framework as follows:
Firstly, some grand theories of Triple Bottom Line- Elkington; Triad
Epidemiology-John Gordon; and Health Determinants-Lalonde, Blum are
respectively used in generating first framework. The theory of Triple Bottom Line
explains improving and developing economic prosperity, Environmental quality
and social Justice or in other words a balance among 3P (Profit, Planet, People).
It is relevant to health theory of Triad Epidemiology (balancing among host, agent
and environment). If we can control 3 factors (agent, host, environment) in
harmony, we will more likely find healthy people, better environment and of
course more productive workers in community and workplace. However, local
specific background of communities including social and culture; ethics and law;
remote area issues including MDGs commitment and NGO /other donors’ interest
should be considered. Based on a real phenomenon, serial communicable
disease surveys in communities showed that locations of exploration have
burden of communicable diseases such as malaria, leprosy, tuberculosis,
filariasis, yaws, and worms and finally included HIV/AIDS. Immunization and
mother and child health services were missing. The company recruits the local
people where the camp station was relatively closed to community. This may
bring the communicable diseases into workplace (Pongtiku, 2006, 2007).
My hypothesis was treatments and health educations through mobile health
team in local communities will reduce burden of communicable disease in the
communities in project locations and will also protect the workplace towards the
communicable diseases. I developed an experimental design of the study to
make an evaluation before and after interventions by an integrated health
program with low cost effective strategies. The framework was described as
below:
Figure 23 Relationships among Workplace, Society an d Infrastructure Framework “As commitment of the company to use 80% labors from local villagers means having
risk to get infectious disease from the local employees (more 1000 people in this project) ,
therefore: (a) The camp station should have a clinic to support the workplaces. Doctor
and paramedic who work in the workplace should know not only treatment of the ill
workers and emergency cases but also treatment for infectious diseases. Screening in
recruiting new employees from local villagers is necessary, people from non endemic
areas and expatriates should be aware of local diseases (b) Mobile health team and
health centers, pustu/subhealth center, midwife and cadres through this CSR program
work together as much as possible in treatments with recommended therapies, case
detection and health education in order to break the chain of transmission of diseases
occurring in the community. Treatment does not only mean the cure but also the best
prevention. Local health nurses and cadres should receive basic training regarding
malaria, leprosy, filariasis and tuberculosis as well as environment related diseases. Two
health centers which close to the workplaces are Bonoi and Mamberamo Hilir health
center are involved. Mamberamo Hilir health center has a sub health center/Pustu Teba
(one nurse) in the location of exploration. In Tamakuri has 2 cadres (In Mitiwi and Amite),
in Anasi (2 malaria cadres),Teba (one cadre).I think for the coming soon, survey should
cover the villages of Yoke, Anasi, Dadat that still close to the location of exploration. If the
project is running well and the company is settled as well as the programs are successful,
then we can expand more coverage. People from Tamakuri have close family relationship
with people in Bonoi, Rapamarei and Poiwai .Similarly, people in Warembarori and Yoke
are also close family relationship. Those people of course will come to search jobs when
the company gets bigger and bigger” (Pongtiku ,2006).
Secondly, with the spirit of CSR’s philosophy as well as consideration of
previous studies which mostly mentioned about stakeholders interaction
problems and CSR malpractices, I therefore learned some grand theories
namely Stakeholder Theory- Freeman ,Post, Rawls, Clarkson; Moeljono Drama
Triangle- Stephen Karpman; PDCA cycle-Walton and Deming; Theory of
Changes- Lewin, Tyagi, Kotter , Barenschot and Competitive Advantage and
Strategic Flexibility-Porter & Kramer; Hill and Jones; Nonaka and Takeuchi ;
Kotler and Pfoertsch .
Figure 24. CSR Implementation during Gas Explorati on Phase Framework
We learned from the previous studies that an interaction with stakeholders for
CSR’s implementation has 2 sides: becoming a power or becoming a
disaster/problem. My pre proposition was working with stakeholders is a power to
implement CSR and can create advantageous values during gas exploration
phase. How to manage stakeholders (company, government and society/NGO) in
positive ways and anticipate as well as solve the possible problems are
challenges for discoveries. Remote area is interesting for many stakeholders.
Government and NGOs have chances to reach remote areas from this
CSR In health
Workplace
-Healthy
-Productive
-Secure
-License to operate
Communities (stakeholder)
-Better health awareness
-reduce incidence of illness/communicable diseases
Company
Management
Value Creations?
-Sustainability
-Taking over to government -CSR still implemented
Remoteness,-lack of education/ignorance,
behavior/culture, poverty
Stakeholders as Power? Government,
Mediator (NGO)
Infrastructure development
Phase of exploitation
(production)
Phase of exploration and drilling operation
(Non production/uncertainty)
: Relationship
Remote issues, public goods, MDGs commitment, NGO/Donors’ interest, previous studies
collaboration with company. NGO helps as a mediator to bridge between
company and government. How to make communications more effective and
roles among stakeholders are crucial .The understanding and applying of
psychological theory of Drama Triangle; PDCA cycle; economy of scale and
learning effect; and Theories of Changes, will help to understand the suitable
concepts in managing this CSR implementation and make it more effective and
efficient as well as transparent particularly in this exploration phase which is
expensive and at risk to fail in oil and gas world business. The competitive
advantage theories help to understand the value creations including social capital
issues during the uncertainty condition of this phase. Sustainable and exit
strategies should also be proposed finally. Those grand theories which
mentioned above are relatively consistent to back up the research questions.
This conceptual framework for Corporate Social Responsibility during gas
exploration phase was eventually simplified as below:
CHAPTER FOUR
RESEARCH METHODS
This chapter explains how this study was conducted and what methodologies
were used to collect the data. It finally provides a significant part of data analysis.
The mainly discussions are as follows:
4.1 Research Design
This research mainly used a qualitative method (Grounded theory design);
however some supporting data from surveys and interventions (experimental
design) would be analyzed quantitatively. This research selected a grounded
approach because it seemed the grounded research would be more flexible to
understand how complex phenomena occur, to explore stakeholder interactions
and eventually to generate a new theory. This grounded theory was developed
strongly by observation, interviews/discussion and continuously monitored its
progress and coordination among stakeholders. On the other hand, a
quantitative method measured pre and post interventions of communicable
diseases/integrated health program that carried out by mobile health team. Field
data collected in period of July 2006 to April 2008 and lengthened until December
2008.
Creswell and Plano Clark (2007) explain about three models of mixing the
data in which one of them is desirable for this research is embedding one
dataset within the other so that one type of data provides a supportive role for the
other dataset. I personally opinion that methodology which used in a research is
depend on the objective of the study, however mixed methods is more powerful
because the methods can more deeply explain process of the study and of course
stronger than single method.
Figure 25. Embed data in mixed methods research -mo dified for this study
Grounded theory methodology was firstly introduced by Glaser and Strauss in
1967 with their phenomenal book “The Discovery of Grounded Theory”. Glaser
concludes two most important properties of conceptualizing for generating grounded
theory are that concepts are abstract of time, place, and people, and that concepts
have enduring grab. The appeal of these two properties can literally go on forever as
an applied way of seeing events (Glaser, 2002). In addition Glaser ( 2002) says “In
doing Grounded Theory, I endeavored to emphasize the complexity of the world and
therefore the freedom, autonomy, and license required to write generated theory that
explains what is going on in this world, starting with substantive areas” .
Brown et al (2002) suggest grounded theory methodology has following eight
assumptions:
1. The need to get out into the field to discover what is really going on (i.e., to
gain firsthand information taken from its source.
Qualitative Data Grounded theory design
(Main design)
Quantitative Data Experimental Design
(Supporting)
Results
2. The relevance of theory, grounded in data, to the development of a discipline
and as a basis for social action.
3. The complexity and variability of phenomena and of human action.
4. The belief that persons are actors who take an active role in responding to
problematic situations.
5. The realization that persons act on the basis of meaning.
6. The understanding that meaning is defined and redefined through interaction.
7. A sensitivity to the evolving and unfolding nature of events (process).
8. An awareness of the interrelationships among conditions (structure), action
(process) and consequences.
As cited in Mehmetoglu and Altinay (2004), the analytic strategy of grounded
theory had been used in several studies in various related fields such as
management (Pandit, 1995), marketing (Goulding, 1997) and tourism (Decrop,
2000). According to Partington (2000), the approach to discovering theory from data
known as grounded theory is much cited but little understood, however the grounded
theory has seen relatively little productive discussion in management literature.
The Grounded Theory Perspective cited in Glaser (2002) argued:
“All is data is a well known Glaser dictum. What does it means? It means exactly
what is going on in the research scene is the data, whatever the source, whether
interview, observations, documents, in whatever combination. It is not only what is
being told, how it is being told and the conditions of its being told, but also all data
surrounding what is being told. It means what is going on must be figured out exactly
what it is to be used for, that is conceptualization, not for accurate description. Data
is always as good as far as it goes, and there is always more data to keep correcting
the categories with more relevant properties”.
A theory which is generated from grounded method must be based on a
phenomenon, not started on data (Emzir, 2008). As cited in Munir (2006), Strauss
and Corbin say (1990) theories can not be built with actual incidents or activities as
observed or reported; that are from raw data. A theory is built from concept, not
directly from data. Concept is resulted from the conceptualization of data: The
incidents, event, happenings are taken as, or analyzed as, potential indicators of
phenomena, which are thereby given conceptual labels. If a respondent say to
researcher, “Each day I spread my activities over the morning, resting between
shaving and bathing,” then the researcher might label this phenomenon as ‘pacing’.
As the researcher encounters other incident, and when after comparison to the first,
they appear to resemble the same phenomena, then these, too, can be labeled as
’pacing’. Only by comparing incidents and naming like phenomena with the same
term can the theorist accumulate the basic units for theory.
A word of Phenomenon (New Webster’s Dictionary and Roget’s Thesaurus,
1992) means anything appearing or observed especially if having scientific interest.
(Partington, 2000) says that phenomenology refers to “reality is socially constructed,
and consists of individuals’ interpretation of their circumstances. Knowledge comes
from the penetration by the researches of the meanings that make up the individuals’
views of reality. The researcher’s role is to reconstruct those meanings”.
Strauss and Corbin (1990) quoted in Munir (2006), Categories are higher in level
and more abstract than the concepts they represent. They are generated through
the same analytic process of making comparisons to highlight similarities and
differences. Categories are the cornerstone of developing theory. They provide the
means by which the theory can be integrated. We can show how the grouping of
concepts forms categories by continuing with the example above. In addition to the
concept of pacing, the analysis might generate the concepts of ‘self-medicating’,
‘resting’ and’ watching one ‘s diet’. While coding, the analyst may note that, although
these concepts are different in form, they seem to represent activities directed
toward a similar process: keeping an illness under control. They could be grouped
under a more abstract heading, they category: ’Self Strategies for controlling illness’.
A qualitative research aims to understand a phenomenon and develops
researcher’s imaginations. It does not take for explanation or interpretation among
variables as in quantitative method (Salladien, 2008). Neuman (2003) explains that
“some people believe that qualitative data are soft, intangible and immaterial. Such
data are so fuzzy and elusive that researchers cannot really capture them. This is
not necessarily the case. Qualitative data are empherical. They involve documenting
real events, recording what people say (with words, gesture and tone), observing
specific behaviors, studying written documents or examining visual images. These
are all concrete aspects of the world”. In this study, communicable disease issues
and social phenomena of mobile communities firstly recognized after one year
implementation of the CSR, through intense field observation and discussion. Again,
the second phenomenon of coordination and conflict stakeholders appeared after
one and a half years observation and experience. Those phenomena and some
actions taken did not stop to observe. In order to gradually understand the
interactions including conflicts and solve problems, stakeholders’ mind sets were
captured. All information were continuously collecting, analyzing and finally enfolding
with literatures including testing/confirmation the emerged theoretical framework to
colleagues/related persons/experts/practitioners.
Strauss and Corbin, 1990 cited in Neuman, 2003 explain that grounded theory is
a qualitative research method that uses a systematic set of procedures to develop an
inductively derived theory about a phenomenon. Bungin (2007) in a provocative way
says that researcher comes into the field with “empty headed” or without bringing
any concept, theory or hypothesis. It is indeed phenomenon, inductively observed as
Glaser and Strauss’s report on phenomena between hospital staffs and dying
patients in their book. However, Kuhn, 1962 and Feyerabend, 1962 cited in
Crompton (accessed on 3/25/2009) observations are not entirely free from the
influences of theories.
Partington (2000) says the paradigm model is at the core of Strauss and
Corbin’s method. It consists of a systematized cause- and –effect schema which the
researcher uses to explicate relationships between categories and subcategories. It
can describe as follows: (A) Causal Conditions --- (B) Phenomenon---(C) Context---
(D) Intervening Conditions--- (E) Action/Interaction Strategies --- (F) Consequences.
The Grounded research model emphasizes an observation method and develops an
intuitive relationship among variables studied. The steps of research are started by
examining formulations and redeveloping propositions during generating a new
theory (Salladien, 2008).
Faisal S (2007) describes the grounded theory is considered as an alternative
approach towards a classical one (verificative study). The grounded theory moves
from the bottom to the top namely empherical data-conceptual- theoretical.
Figure 26.The Inductive Model of Research in a Qual itative Study Source: Creswell, 1994 Similarly, Moleong (2008),Pandit (1996) the process of developing the grounded
theory is Theoretical Sampling (1)---Data collections(2)---Data ordering(3)---Data
Analysis(4)--- theory development (5)---if theory saturation the study finished(6) and
if not saturation the study continued. Dick (accessed 8/19/2002) says that over time,
the grounded theory study works through the following mostly-overlapping phases:
data collection, note taking, coding, memoing, sorting and writing. This research tries
to understand and to analyze more deeply the relationship based on facts (data,
interview and observation) and finally compared with literature review in generating a
theory. Creswell (1994) shows an inductive model of thinking or logic to build a new
theory as follows:
To sum up the process of this study as follows:
Researcher Gather Information
Researcher Asks Questions
Researcher Forms Categories
Researcher Looks for Patterns (theories)
Researcher Develops a Theory or Compares Pattern with Other Theories
Figure 27. Process of this research 4.1.1 The grounded theory approach Mode 2 required for this study
Bryman (1988) observes “In spite of the frequency which Glaser and Strauss and
the idea of grounded theory are cited in the literature, there are comparatively few
instances of its application…’ (cited in Partington, 2000). Partington (2000)
comments that the difficulty of applying universal grounded theory prescriptions is
borne out by experience with doctoral students working the field of organization and
management who attempted to follow the Strauss and Corbin approach but have
abandoned it because of its bewildering complexity. Indeed, in published
management research there is little evidence of the successful application of any
precisely delineated, prescribed approach. Partington examined such four
Field Data: Observation, result of surveys, experience, and data analysis, implementation of
program Phenomena 1
Continuous Observation, interview, field data, story
analysis, implementation of program Phenomena 2
Continue Data Collection
continue interview, primary and secondary data collection
Data Analysis
Familiarizing data, Coding (open coding, axial coding, selective coding), Memos, Triangulation
Method, Enfolding References
Theory/ Model More Abstracts, Simplifying
management grounded theory exemplars: Brown and Eisenhardt (1977)---multiple
cases studies, Gersick (1994)---single case study, Gioa and Chittipeddi (1991)---
single case study and Kram and Isabella (1985)---pairs of individuals. In each of
these four exemplars the output of the studies is of mode 1 type, primarily aimed at
an academic audience. The purpose of development into theories with a direct,
practical use was a secondary consideration. As a result, although the theories
generated by these studies contribute to our understanding of social processes, they
are unlikely to be of direct interest to managers. The Mode 2 was initially introduced
in 1994 by six authors :Michael Gibbons, Camille Limoges, Helga Nowotny, Simon
Schwartzman,Peter Scott, and Martin Trow through their book of The New
Production of Knowledge: The Dynamics of Science and Research in Contemporary
Societies (Nowotny et al, 2003). Partington, 2000 and Crompton, accessed on
3/25/2009 note in the field of management, the mode 2 knowledge-production
system brings together the ‘supply side’ of knowledge, including universities, with the
‘demand side’, including business. The whole system depends for its effectiveness
on a rapid interplay between management theory and practice. Kurt Lewin says
“Nothing is so practical as a good theory “ cited in Human Resource Development
Review,2005. Partington (2000) shows how examination of the distinctive
characteristics of a specific research aim can usefully transform Strauss and
Corbin’s model into a procedure which is directly applicable to the development of S-
O-R theories in mode 2 management research by Gibbons et al. The differences
of Mode 1 and Mode 2 are presented as below,
Table 6. Mode 1 and Mode 2: two different models fo r undertaking research
Different Research Models Mode I Mode II Steering mechanism The academic discipline Problem based, multi
disciplinary Authorization Professional rules Scientific & societal rules Objectives New theories Usefulness Type of knowledge General Specific Time perspective Long term Short term Responsibility The scientific community A societal responsibility Actors Researchers Participants & researchers Relationship Hierarchical Equal Works forms Planned, predetermined Flexible, interactive Approach Closed Open Physical proximity Distant Close Actors Universities Research & Development
centers, institutes, companies ,regional universities
Relations Object relations Subject relations Strategy First discovery, then application Simultaneous discovery and
application Source: Svensson, Ellström and Brulin,2009
Chopra (2005) in Dictionary of Management defines Stimulus is initiating step
intended to provoke a predictable response. Cognition is process which uses all
human senses to observe the outside world and to form perception attitudes,
comprehension and memory. Luthans (2002) says cognition is the act of knowing an
item of information. Under this framework, cognitions precede behavior and
constitute input into the person’s thinking, perception, problem solving, and
information processing.
If we trace back, we learn that B.F. Skinner, a modern behaviorism, who is
widely recognized for his contributions to psychology explains respondent behavior
(those behavior elicited by stimuli) but not the more complex operant behavior. It is
for example: the S-R approach in physical reflex, when stuck by a pin (S), the person
will flinch (R), or when tapped below the kneecap (S), the person will extend the
lower leg (R). He strengthens the importance of the response-stimulus (R-S)
relationship. The organism has to operate on the environment (thus the term operant
conditioning) in order to receive the desirable consequence. Several studies from
Davis and Luthans; Luthans and Kreitner as well as Albert Bandura, social learning
takes the position that behavior can be best explained in terms of a continuous
reciprocal interaction among cognitive, behavioral, and environmental determinants.
The person and the environmental situation do not function as independent units but
in conjunction with the behavior itself, reciprocally interact to determine behavior
(Luthans, 2002). Raimond (1998) includes The Stimulus-Response Model by Rosch
(1992) in their paper “Where Do Strategic Ideas Come From? As follows: Figure
28a is a diagram of the behaviorist world-view. The first arrow, the stimulus, is
something that the experimenter does to the organism (human or animal); it is in the
external world, observable by everyone. The second arrow is what the organism
does after the stimulus, also something observable by everyone. The square
between the two arrows is the mind, considered as black box, a box that is not
publicly observable and hence not subject to scientific investigation, hence
unnecessary to talk about. For the strict behaviorists, the biological organism was
also in black box. So psychologists could be completely objective; they need only
chart the relationships between stimuli and responses.
Figure 28 a. The stimulus-response model Source: Rosch, 1992
Stimulus Response
Furthermore, the information processing model takes the view that when the
information or stimulus comes into the brain of the organism it has to be processed
in order that the appropriate response can be made (Raimond, 1998). S-O-R
(Environmental Stimulus –Cognition-Management Action) theories are concerned
with how people’s understanding of their environment leads to actions. The
assumptions behind grounded theory’s symbolic interactionist origins match this
consideration. Two features of Mode 2 are: First, transdiciplinary research is less
likely to be based on the existing, highly developed theoretical frameworks from
bounded disciplinary traditions, which tend to characterize Mode 1. Second, Mode 2
emphasizes tacit knowledge, which has not yet been codified, written down and
stored. Academics and managers attempt to learn, working together from one
another in virtuous cycle of understanding, explication and action in a mutually
transdisciplinary frame (Partington :2000). Takeuchi (1998) argues what Western
companies need to do is “ to unlearn” their existing view of knowledge and pay more
attention to (1) tacit knowledge,(2) creating new knowledge, and (3) having everyone
in the organization be involved. Japanese companies have advanced their position in
international competition because of their skill and expertise at organizational
knowledge creation, which is the key to the distinctive way that Japanese companies
innovate. Tacit knowledge is highly personal and hard to formalize and share with
others. Subjective insights, intuitions and hunches fall into category of knowledge.
Tacit knowledge is deeply rooted in an individual’s action and experience, as well as
in the ideals, values or emotions he or she embraces. Furthermore, tacit knowledge
contains an important cognitive dimension. Yet they cannot be articulated very
easily, this dimension of tacit knowledge shapes the way we perceive the world
around us.
Figure 28b. The information processing model
Source: Rosch, 1992
The simplified and revised model of S-O-R will be shown below.
Figure 29. Revised grounded theory approach & Parad igm Model
Source: Partington, 2000
Decision making
Short term memory
Revised Approach
Interviews
S-O-R
Emphasis on normative causal model
Simplified paradigm model
Environmental Stimulus
Cognition
Management Action
Sensory Register (very short term) Long-term
memory (knowledge, language, goals, etc)
Response
The World Attention
Problem solving Stimulus
The World
Mode 2 for this application analyzes recollections of past events, often recorded in
interview data, to develop explanation of management action. Two characteristics of
mode 2 enquiry are transdiciplinarity and emphasis on tacit knowledge. The
approach however offered differs in two important ways from the much cited
universal grounded theory model originated by Glaser and Strauss (1967) and later
proceduralized by Strauss and Corbin (1990). First, it acknowledges that the form of
theories of management actions which will satisfy the cotemporary demands of
mode 2 research is different from the form of integrated sociological theory for which
the original grounded theory approach was developed. Second it takes account of
differences between the ontological assumptions underlying the use of retrospective
data for analyzing management action, and those associated with participant
observation, the pivotal strategy of grounded theory’s symbolic interactionist roots.
The results would be a simplified, more direct approach which works for the specific
purpose of generating useful, consensually valid theory (Partington, 2000).
Crompton, accessed on 3/25/2008 in her paper about Knowledge Production and
Management in 21st Century, in regard of new knowledge and methodology, she
states that “learning is defined here as any (more or less permanent) change of
behavior, which is the result of experiences; the acquisition of knowledge,
information, values, belief, norms and behavior (where values, beliefs and norms are
dependent on culture). However as learning produces new knowledge which is the
basis of innovation, and it has been shown that learning and knowledge are a social
–cultural phenomena then researchers need to ‘walk the walk’ and ‘talk the talk’ of
ordinary people in situ. I suggest that transdiciplinary approaches using multi-
methodologies will be helpful in understanding complex social and cultural
situations”. Gioia and Pitre (1990) broadly define theory as any coherent description
or explanation of observed or experience phenomena. As cited in Luthans (2002)
“theory is the answer to queries of why. Theory is about the connections among the
phenomena a story about why acts, events, structure, and thoughts occur. Theory
emphasizes the nature of causal relationships, identifying what comes first as well as
the timing of such events. Strong theory, in our view, delves into the underlying
process so as to understand the systematic reasons for a particularly occurrence or
non-occurrence”. As cited in Totok Hari Wibowo (2005) some scholars talk about
knowledge creation. Giddens notes all social actors, all human beings are highly
‘learned’ in respect of knowledge which they possess and apply, in the production
and reproduction of day-to-day social encounters. He distinguish between discursive
and practical knowledge, the former refers to knowledge that the actors are able to
articulate (what is said), and the latter refers to tacit knowledge, which actors are
able to draw on in action but are unable to express (what is simply done).Reflexive
refers to the capacity of humans to routinely observe and understand what they are
doing while they are doing it. It is not merely self-consciousness but includes
continuous monitoring or physical and social contexts and activities either their own
or others. Other scholar says knowledge conversion takes place within ‘ba’. It is the
physical and /or mental space that enables the process of conversion. ’Ba’ is a
Japanese term, which literary means space or place. The concept of ‘ba’ was
originally proposed by Kitaro Nishida. The concept of ‘ba’ concerns far more than
physical elements, it includes perceptions throughout body and mind. Therefore ‘ba’
offers a context. In order to understand creativity as a tacit knowledge we cannot
ignore situated cognition and action. In knowledge creation, generation and
regeneration of ‘ba’ is the key, because ‘ba’ provides the energy, quality and location
to perform the individual conversions and to move along the knowledge spiral. As
cited in Muhadjir (1996), Glaser and Strauss suggest, in order achieving more
optimal level of the new theory, the grounded research should be carried out in non
traditional areas, where the place is limited references. Eisenhardt (1989) also says
that this research approach is especially appropriate in new topic area.
In this study, I finally selected Mode 2 (modified grounded theory) for some
reasons:
1. My concern of this study was to develop a useful theory which can bridge
between theory and practice in management. S-O-R perspective teaches us
that its orientation emphasizes the active, mediating role of the manager
between environmental stimulus and behavioral response. This is may
become more applicable for the management study. (Partington, 2000) says”
the theorized relationship between environmental stimulus and management
action, and the intermediate role of personal control, has potentially important
consequences for managers “.
2. I collected data from 2006-2008 means a retrospective data which is
matching with Mode 2.
3. I would like to reduce complication and long process as the traditional
grounded theory (Mode 1): Causal Conditions --- Phenomenon---Context---
Intervening Conditions---Action/Interaction Strategies ---Consequences ,
compared to the modified one ( Mode 2): Stimulus---Cognition---Response,
which emphasized on developing explanations of management actions. I
learned very much from invaluable experience of this case through
observations, interviews and sharing with managers and field team. From
informants and stakeholder interactions, I recognized tacit knowledge .I also
observed comprehensive views from this case so transdiciplinary approaches
were likely relevant. Here academics/ other practitioners and managers
attempt to learn, working together from one another in virtuous cycle of
understanding, explication and action.
4.2 Location of Research
The location of the company operation was very remote, as one of isolated areas
(MAF, 2001) and in the border of two new born districts: Sarmi and Waropen (now a
part of a new district of Mamberamo Raya) in Papua, Indonesia. The location of
exploration and the camp has swamps areas, mangrove forest, rivers and coastal
areas. People are absolutely depending on the nature. Some preliminary surveys
showed that some places of Rombebai Block were currently burden of
communicable diseases (malaria, leprosy, tuberculosis, filariasis, yaws, and worms)
and lastly included HIV/AIDS. Social economic and community involvement studies
in Rombebai showed that the main problem is in fact, accessibility to health service
and health infrastructure (UNIPA, 2006; Pane and Pongtiku, 2008). Villages for
sampling and implementations were deliberately selected, however were preferably
located near/surrounding operation of Nations Petroleum due to accessibility and
directly future impact of the project. The names of villages are Tamakuri (Mitiwi,
Amite), Warembori, Geza, Anasi, Bonoi, Dadat and additional villages. Estimated
total coverage in 2007 was 2300 population (8 villages) and expanded in 2008, so
total coverage was 3500 population (11 villages). Sample size of population taken
and evaluated would be expected around at least 20-30% in order to ensure the
quality of data (Pradhan, 2003), but in this case, population samples were more than
minimal required and mass treatment for elephantiasis expected all population.
Village coverage had been gradually increased based on experience and the place
of drilling points or expansion of the Nation Petroleum’s project. Mobile health team
consisted of 10-15 people, with different back grounds (general doctors, nurses,
midwife, laboratory technician and staff from safety, health and environment of the
company). Stakeholders involved were Nations Petroleum Company, Community,
Health Government (Departemen Kesehatan RI;Dinas Kesehatan Propinsi Papua;
Dinas Kesehatan Kabupaten Sarmi,Waropen,Biak, Rumah Sakit Umum Biak, Balai
Laboratorium Propinsi Papua),Government in Oil and Gas(BP Migas), Non
Government Organization (Netherlands Leprosy Relief), University (FKM and UNIPA
Universitas Cendrawasih).
Figure 30. Map of Village Research Source: NP
4.3 Data Collection
This study has limited time according to the first exploration and drilling operation
of the Nation Petroleum project in Rombebai namely July 2006-April 2008. Baseline
data had been collected and serial health surveys had been done in 2006-2007 as
well as continuous observation. The previous surveys were as follows:
Table. 7. Previous Health Survey in Rombebai No Previous Survey Led by Remarks
1 Socioeconomic and environmental study (Tamakuri and Warembori)
Unipa March 2006
2 Social economic survey about Gesa INRR &PPLH-Unipa
2006
3 Medical site survey Hospied and Zebua
May 2006
4 Health survey and treatment Pongtiku July 2006 5 Health Survey and Treatment Berbudi Sept 2006 6 Follow-up cases and analyzing data Pongtiku Oct 2006 7 Health surveys and follow up cases and
intervention Pongtiku Dec 2006
8 Health assessment Rozendaal and Made
May 2007
9 Health survey and intervention Pongtiku July 2007 10 Health survey and intervention Pongtiku Oct 2007 11 Health survey and intervention Pongtiku Nov 2007 Source: Primary Data
The new data had been collected since January of 2008 and following it up until
the end of the year of 2008. The author was also an initiator and an implementer so
triangulation method (data, interview and observation) is continuously used in
monitoring and evaluating the progress of the CSR. The new data consisted of (a)
Health survey, evaluation and intervention, led by Pongtiku, in February 2008, (b) I
presented the results in “Save Papua workshop” in May 2008 in Sentani Hotel
,Jayapura ,(c) We had published an article of “Creating a value from private-public
partnership during gas exploration phase” and gave an oral presentation regarding
results of this CSR to “Indonesia Oil and Gas Convention and exhibition” in Jakarta
in May 2008 (Pane and Pongtiku), (d) Beside that, some stakeholder meetings had
been taken place in Biak and Jayapura in Biak and Jayapura, as well as signed
Memorandum of Understanding carried out in Jakarta and Biak. I presented a few
times the progress in the stakeholder meetings (Depkes RI, Dinas
Kesehatan,Nations Petroleum, BP Migas), (e)Beside my daily notes during
observation, limited questioners were given to get feed back of the CSR
implementation from some related persons who involved during implementation and
coordination of this project: Manager of Community Development of Nations
Petroleum, Head Division of Health and Safety of Nations Petroleum, Head officers
from Department of Health, and some people in mobile health team,(f) Evaluating
communication through all correspondences in internet which were more than 350
mails,(g)Interviews of some experts/epidemiologist and high officers in Department
of Health and economist and to discuss my field findings and to test some emerged
thoughts,(h) We analyzed all previously visual documentations (photos, video
tapes),(i) I presented this case in our doctoral class in the University of
Cenderawasih, Jayapura and once in the 3rd Doctoral Journey in Management/DJM3
in Jakarta (in August 2008),(j) In addition, I compared my previously and currently
other remote area surveys and other health surveys/ intervention in Papua done by
provincial/district health offices with similar strategies (low cost effective strategy),(k)
Collecting related references from Nations Petroleum, BP Migas publication, and
other publications available from internet ,magazines or news papers
To sum up the data collection :Primary data were daily notes, interviews,
questioners, progress reports, emails (about 350 correspondences), field data, other
visual documentations and film transcription. Secondary data were previous reports
from other examiners and references.
4.4 Data Analysis
Two area concerns for this data analysis were as follows:
a) First, mobile local community which came and stayed near camp station and
burden of communicable diseases from phenomena 1 will be analyzed
quantitatively (experimental design). Pre and post interventions presented
using proportion and descriptive analysis. It will be as a supporting data in
building a new theory of CSR.
b) Second, stakeholders interactions which was our main focus from
phenomena 2, was analyzed qualitatively using grounded method design.
Evidences from fields (data and direct observation to community and direct
involvement in the activities and field coordination), experience’s researcher
and deep discussion to our team and communications with stakeholders,
were practical ways to find the ideas. Questioners, email correspondence,
interviews with stakeholders, daily notes of researcher and other
documentations will be collected and analyzed (selecting, coding,
categorizing and so forth) in generating a new theory of CSR in
management.
To support the concepts and to answer the hypothesis (H1) was ‘treatments and
health educations through mobile health team in community will reduce burden of
communicable disease in the community in project locations and will also protect the
workplace towards the communicable diseases’, data of health surveys used a
descriptive analysis based on health indicators which compared before and after
interventions of communicable diseases control. Malaria surveys used MBS (Mass
Blood Survey) and FBS (Fever Blood Survey) methods. Lymphatic filariasis used a
finger blood test that carried out at night due to cycle of filariasis worm. Tuberculosis
was performed by sputum examination test and leprosy by cardinal signs. HIV/AIDS
used PITC (Provider Initiative Testing and Counseling). Mother and Child program
and nutrition was based on routine protocol of the program. The all methods were
relevant to the WHO guideline. Statistical Data showed through graphs and tables,
some changes or progress was evaluated. Details of these communicable disease
control methods and its operational definitions were put in annexes. “When we
collect more records than we can review individually, we can use tables, graphs and
charts to organize, summary, and display the data clearly and effectively. With
tables, graphs, and charts we can analyze data sets of a few dozen or a few million.
These tools allow us to identify, explore, understand, and present distributions,
trends, and relationship in the data. Thus tables, graphs, and charts are critical tools
not only when we perform descriptive and analytic epidemiology, but also when we
need to communicate our epidemiologic findings to others” (U.S .Department of
Health and Human Services, accessed on 2/28/ 2005). In addition, the trend is much
more informative than single reading. Observing trends overtime is also a way of
validating the data. When operational conditions change, trends must be interpreted
cautiously (ILEP Medico-Social Commission, 2001). To see directly or indirectly
effects to workplace, data in trend from health and safety department of the company
will be included. In addition, a self assessment using Malcolm Baldrige Scorecard
filled by a manager for community development will be attached in evaluating overall
performance including Leadership, Info & Analysis, Planning, Human Resources,
Process Management, Operations and Customer. Various sources of data and using
triangulation method will ensure quality of data analysis.
Since the main aim of this study was to build the new theory/model of CSR, my
pre proposition (P2) was working with stakeholders is a power to implement CSR
and can create advantageous values during gas exploration phase needs the further
discoveries through the process of qualitative data analysis. It was expected to
understand and learn what, why and how the stakeholder interactions were a power
and value creations in the special contexts such as uncertainty condition of
exploration phase, remote area location and as a new company which entered new
business in Indonesia. The grounded theory method answered this concern.
To get a chronological picture of grounded theory process, Neuman (2003)
explains that in grounded theory, a qualitative researcher develops theory during
data collections. This more inductive method means that theory is built from data or
grounded in the data. Moreover, conceptualization and operationalization occurs
simultaneously with data collection and preliminary data analysis. It makes
qualitative research flexible and lets data and the theory interact. When data
collection and theorizing are mixed together, the theoretical questions arise that
suggest future observations, so new data are tailored to answer theoretical questions
that come from thinking about previous data.
Mehmetoglu and Alinay (2006) comment, the focus on qualitative research has
unfortunately been mainly confined to methods of data collection and neglecting a
more significant aspect, namely data analysis. The data analysis in a grounded
theory as Glaser and Strauss’ suggestions contains: Incidents of phenomena in data
are coded into categories. By comparing each incident with previous incidents in the
same category, the researcher develops theoretical properties of categories and the
dimensions of those properties. As the study progresses, the focus changes from
comparing incidents with one another to comparing incidents with properties of the
category that resulted from initial comparisons of incidents. The theoretical sampling
and constant comparison processes lead towards the theoretical saturation of a
reduced set categories within the boundaries of the emerging theory. Memos-
records of ideas relating to categories and the categories themselves form the basis
of the written theory. Explored in different field settings and broader contexts,
substantive theory may be developed into more abstract, generalized formal theory
(Partington (2007), Wignjosoebroto.S (2006). In discovering theory, one generates
conceptual categories or their properties from evidence, and then the evidence from
which the category emerged is used to demonstrate the concept. The evidence may
not necessarily be accurate beyond doubt, but the concept is undoubtedly a relevant
theoretical abstraction about what is going on in the area studied. Furthermore, the
concept itself will not change, while even the most accurate facts change (Glaser
and Strauss, 1967). Partington (2000) says the twin basics of grounded theory are
theoretical sampling, whereby the process of data collection is controlled by the
emerging theory, together with constant comparison method of joint data coding and
analysis. As importance of coding issues, Awad and Ghaziri (2004) in their text
book of Knowledge Management say codification is a prerequisite to knowledge
transfer. From a knowledge management view, codification is converting tacit
knowledge to explicit knowledge in a usable form for organizational members. From
an information system view, it is converting undocumented to documented
information. Regardless of the view, codification is making –specific knowledge (tacit
and explicit) visible, accessible, and usable for value-added decision making, no
matter what form it may take. This means that:
a) Tacit knowledge (in people’ heads) such as human expertise is identified
and leveraged through a form that delivers the highest return to the
business. It may be through knowledge-sharing events, organized
directories, yellow pages, or other means that will connect the ones who
need the expertise to source of expertise.
b) Explicit knowledge should be organized, categorized, indexed, and
accessed via the company’s intranet or some other means to make it
visible, accessible and usable – on paper, in documents, in data base.
Codifying tacit knowledge is complex and is more of an art than a science. Several
different ways of encoding facts and relationships to codify knowledge exist. They
include knowledge maps, decision tables, decision trees, frames, production rules
and software agents (Awad and Ghaziri, 2004). As already mentioned in the
previous paragraph, there were some levels of codification in grounded theory,
however more specifically described as cited in Mehmetoglu and Altinay( 2006),
Brown et al (2002) are as follows (a) Open coding as the process of breaking down,
examining, comparing, conceptualizing and categorizing data. Data were broken
down by asking simple questions such as what, where, how, when, how much, etc.
Data that were initially broken down were then compared and similar incidents were
grouped together and given the same conceptual label. This process of grouping
concepts at a higher, more abstract level is termed ‘categorizing’ ;(b) Axial coding is
whereas open coding divides the data into concepts and categories, axial coding
puts them back together in new ways by making connections between a category
and its subcategories. The focus of axial coding is to create a model that details the
specific conditions that give rise to a phenomenon’s occurrence. During axial coding,
the emerging categories, themes or pattern were validated by comparing the
information with other informants, comparing the emerging themes with the
information obtained through observation and secondary analysis of documents from
and about the organization. We then make a theoretical memo: a sort story which
plays an important role and assists in the process of creating order and making
sense of data. The process of open coding, axial coding and writing and developing
memos lead to a number of finalized and saturated categories; (c) Selective coding
is the next type of coding involved the integration of categories (axial) to form an
initial theoretical framework. The codes and categories are explored further by
revisiting the coded statements, with attention being given to understanding the inter-
relationship. All the data were finally sifted and charted.
Mehmetoglu and Alinay (2006) summarize that the analytic strategy in practices
of the Grounded Theory consisted of three concurrent stages / activities namely:
Stage 1: familiarization, Stage 2: coding, conceptualization and ordering, and Stage
3: enfolding literature. Miles and Huberman (1994) also cited in Sugiyono (2007)
summarize an interactive model for data analysis data as below:
Figure 31. An Interactive model for data analysis
Data Collection Data Display
Data reduction Conclusions: drawing/verifying
Partington (2000) suggested application for Mode 2 researchers seeking to build
causal S-O-R theories of management action from retrospective data may use the
guiding structure of three linked models: the simplified paradigm model, the
simplified conditional matrix and the three overlapping domains of reality in the
critical realist ontology. Mode 2 focuses on management actions, of course also
means a bit shorter process of analysis than traditional grounded theory. In practice,
the three models may be applied to the established procedures of grounded theory
through the following steps:
1. Using the established procedures of grounded theory (Open coding - Axial
coding – Selective category (Glaser’s style) and the basic elements of the
simplified paradigm model of S-O-R (Environmental Stimulus –Cognition-
Management Action), code each example of active environmental stimulus
which signified by management attention into categories, each with
properties and dimensions, maintaining a flexible working definition of each
category.
2. Similarly code each instance of action
3. Using the concentric circles of the simplified conditional matrix drawn on
large sheet of paper, make a freehand graphical representation of all
instances of stimulus and action. Draw links between them.
4. Consider as to possible underlying mechanism which could offer a theoretical
explanation of the cognitive process which intervene between, and explain,
links between instances of stimulus and response. Seek explanations which
informants find appealing and valid.
5. Generate the theory in contrasting contexts, continually testing and modifying
the coding scheme. Draw into focus a cognitive process which offers a
consensually valid and informative link between stimulus and action.
6. Write the theory in the form three stages, each representing a progressively
higher level of theoretical abstraction:
• Case narrative with illustrative data samples
• Summary within case and cross-case tabulations
• Theoretical propositions and summary process models
To summarize the data analysis in building this new theory, I strengthened once
again using a figure 32 that it is analyzed by using Mode 2 (the modified grounded
theory method) which focused on Environmental Stimulus-Cognition-Management
Action on CSR implementation and dealing with stakeholders and mixed with
supporting quantitative data analysis namely (a) pre and post intervention of
communicable diseases control in community, (b) Trend of diseases and incidence
in workplace from health and safety department of the company (c) quality
performance which was measured by Malcolm Baldrige scorecard. Finally, I put it
back in one picture of mixed methods of data analysis as below.
Figure 32. Mixed methods of data analysis
4.5 Credibility of Data
Some efforts were done to ensure accountable /credible data as follows:
Lengthening observation including informally visiting other areas/villages which
impacted by other companies operations (Bintuni and Timika);-Keen to do
observations and search up to date information; Triangulation (consistency among
data, observation, interview); Test to water (tested about
recommendations/conclusion of progress reports or results to other stakeholders/ the
informants, giving feedbacks ;Circulated reports/progress report to stakeholders;
Discussion to experts; Discussion to others using common sense; Discussion with
mobile health team; Discussion with company man; Presented to
Mode 1 Glaser & Strauss; Straus Corbin
(Causal condition-Phenomena-Context-Intervening-Action
/interaction Strategies-Consequences
GROUNDED THEORY
QUALITATIVE ANALYSIS
Mode 2 Gibbon et al (Environmental
Stimulus-Cognition-Management Action
-Epidemiological Trend of Diseases in community &
Workplace; -Malcolm Baldrige
scorecard
QUANTITATIVE ANALYSIS
workshops/meetings; The author of this paper was functioned as a
mediator/coordinator, implementer and medical consultant of this project or deeply
involved in this CSR’s process; Nations Petroleum received Award ”Manggala Karya
Bhakti Kartika” at National Health Day from Minister of Health Republic of Indonesia.
This CSR has supported health and environmental care (Kompas, 18 December
2008; Bisnis Indonesia, 17 January 2009).
4.6 Ethical Considerations
As cited in Creswell (1994) most authors who discuss qualitative research study
address the importance of ethical considerations where the researcher foremost has
an obligation to respect the right, needs, values, and desires of the informant(s). In
this study, the following safeguards were employed to protect the informant’s rights:
1. The research objectives were articulated verbally and in writing so that they
were clearly understood by the informants. It is including a description of how
data will be used.
2. Written permission proceeds the study, in this case formal letter permission
from the company and informally talking to those informants during this study
and through sharing information. The questioners and feed back given by the
informants were ensured confidentiality and protect the identity of the
informants (anonym).
3. The informants were informed about all data collection devices and activities
as well as were partially and gradually report during process of writing this
dissertation.
4. The informant’s rights, interests and wishes were be considered first when
choices are made regarding reporting the data.
5. Transcription, written interpretations and reports were made available to the
informants. Full dissertation report would be finally accessible for the
informants.
CHAPTER FIVE
RESULTS AND DISCUSSION
This chapter consists of three topics namely first, Qualitative Analysis, which
generate a theory of CSR/ stakeholders ; second Quantitative Analysis, which
provides a supportive role for the other dataset presented and third, is discussion.
5.1 Qualitative Results
Before I discuss about qualitative results, I would like to state “What is the
greatest challenge in implementing CSR? ... The challenge is dealing with
stakeholders”.
5.1.1 Qualitative analysis in brief
Process of data analysis firstly started with open coding “stimulus and action” as categories from transcription. To make it simple I prepared headings and key words for categories. I then secondly came into the phase of axial coding . In this phase, I used combination of excel program in the computer and manual. In this axial coding, I especially put those data back firstly by grouping the similar categories (step one) with copy and paste technique and then made connection its relationship among categories and subcategories manually (step two). I prefer to use the term of categories and subcategories than stimulus and action in the axial phase to keep the terminology as usual as Grounded Theory and avoided confusion. Using key words during axial coding may be helpful, the relationship between categories and its subcategories become simple and short. We can save our words because the summary will appear again in Memo . As Selective Coding , I lastly selected core categories and its categories to describe the theoretical model. A new theory of Competitive Stakeholder Theory was resulted. Theoretical propositions are (a) CSR (Triple Bottom Line Philosophy) and Stakeholder Theory are competing theories considered as strategic management to achieve objectives through value maximizing. The goal of Stakeholder Theory is pro all stakeholders involved. Every stakeholder including shareholder shares and creates values together which are useful for themselves (b)Competitive Stakeholder Theory is a dynamic process that contributed by Power and Control of Stakeholders embedded in ethics philosophy; existing issues; cost effective strategies; moral and trust; PDCA; recognition and creating values. They are continuous process and interrelated. I finally presented assumptions, details of variables, validation of theory and working out problems in doing GT.
The basic ideas of the Grounded theory approach is to read (and re-read) a textual
data base (such as a corpus of field notes) and “discover” or label variables (called
categories, concepts and properties) and their relationship. The ability to perceive
variables and relationship is termed “ theoretical sensitivity” and is affected by a
number of things including one’s reading of literature and one’s use of techniques
designed to enhance sensitivity (Borgatti, accessed on 11/26/2009). Using
established procedures and ideas of grounded theory from Glaser and Strauss
(1967), Partington (2000)(especially) , Gibbons et al(1994), Rosch (1992), Strauss
and Corbin (1990) , Pandit (1996), Dick (2000), Mehmetoglu and Altinay (2004), and
Huehls (2000) I analyzed data with steps as follows:
1. As all data are available (daily notes/observation, emails, film ,photos and
other related documents),I firstly selected instances of Stimulus and Actions
to prepare transcription. I collected as much as possible of Stimulus and
Actions from different sources of the available data.
There are 440 items in transcription, however only some examples are given
below:
Table 8a. Examples of Stimulus and Actions from tra nscription No Source Transcription Remarks
2
Researcher
Partnership with the company should be based on a principle of win-win solution. Provincial health authority will support technical persons for doing assessment/survey and supply some logistics of drugs program, bed nets, insecticides and others available in the programs. Due to remoteness and difficult areas, a model of integrated programs has chosen, however coordination was strongly needed. This will also make the program more cost efficient. Surveillance team work should be strengthened, meanwhile empower the new districts staff and health centers surrounding and community will be the target for sustainability. All the strategies follow the national guideline
P1
Table 8a. Continued…
No Source Transcription Remarks
4 Researcher Progress report was distributed/cc to 29 persons included company, government and NGOs. The report wrote in English and Indonesian
P1
10
Researcher
I remember when first time, I met 2 high level people in the company they have already received my field reports about poor people and communicable diseases. The first words they said”, nice to meet you… doctor.” We are profit company, which looking for oil and gas, we do not interest in charity how we can work with you in this situation…
DN
13
Researcher
(They are really surprised and appreciated me). May be I can support you, Sir in another way to bridge between your company and government. This is actually the government’s duty but they cannot reach such people in remote Mamberamo…..We believe you doctor and we are looking for people like you
DN
18
Researcher
People from both these places , thanked for working as labors in Nations and also have better opportunities to access to Biak and other places since Nations operated including referred emergency cases to Biak Hospital
P3
22
Researcher
151 people were taken for blood examination using RDT (Rapid Diagnostic Test for malaria). There were 38 positive malaria (25%), it was an extreme figure and predominant cases in which were falciparum type (90%) that might be developed to be severe. Many children had spleen enlargement showed chronic malaria and worms’ infestation. Children less than 9 years who had positive malaria were 24 cases (66%), most of them were falciparum type (88%).Positive malaria cases were treated by artesunate,amodiaquine and plus primaquine if tersiana or mix infection. I also gave advices to company doctor regarding using rapid test for malaria, to combine with clinical malaria
P3
53
Researcher
I made several dialogues with the corporate from Jakarta and Biak through teleconference .Some people gave questions respectively regarding CSR activities. I remember it had been 5 times I dealt through teleconference. We also could use facility of company such as email and telephone from remote Mamberamo to contact some people and include family if needed
DN
54 Informant Community are very welcomed for corporate , may be only 1 or 2 people in the village do not agree ( informal leader)
DN
Table 8a.Continued…
No Source Transcription Remarks
55 Informant “Relationship to community and security are very important where we put dialogue a head , it is not suitable for army for being to day security “ some one from company said
DN
66 Informant How much corporate invest in the place, how much they can give for us? (Someone/stakeholder manager said).
DN
72 Researcher Some phone calls from Depkes Jakarta confirmed about malaria interventions in remote areas. They then and supported us by sending bed nets, drugs and tool test.
DN
77 Informant CSR will protect workplace because we can access data and mapping of diseases or at least we know health condition of people around the workplace (someone from corporate said).
DN
78 Informant We have created values through these activities. This CSR is indeed super efficient (someone top manager of corporate).
DN
79
Researcher
I showed very well scheduled of visits to Rombebai, detail activities in the emails. Many times the schedules were updated for linking field activities of corporate and also weather information. The mobile health team member and I were often contacted by phones from company to know our preparations.
DN
100 Informant Basically anybody wants to be appreciated and have a good name and may be a tendency to show who is he or she? It is important to speak with them (some one/top manager said).
DN
101 Informant You should put all flags raising and flapping so any party can feel appreciating (some one/different top manager said
DN
106
Researcher
I remember when I interviewed and confirmed to Mr. A in Jakarta, NP carried out CSR for cost recovery reasons or new regulation of 2007, didn’t you? No …not at all, we have started 2006, this is far from the issues of cost recovery if we fail the operation in this phase there will be no reimbursement. This is genuine that our corporate wants to help local communities
DN
Table 8a. Continued
No Source Transcription Remarks
111
Informant
This means Nations Petroleum has been willing to implement CSR program without depending on the issue of cost recovery, because if the exploration is failed or not economical, so the block could not be developed and the block then returned to government. So I can conclude that Nations Petroleum is really serious to make investment in Rombebai block and increase the quality of life of local people through CSR program. Only strong commitment can make the CSR program implemented and well organized as well as directly touched local communities around location of exploration.
Q2
124 Informant CSR activities, particularly mobile health team is indeed useful to provide health services to communities in remote area Papua.
Q3
128
Informant
I understood that CSR activities are mutual responsibilities, not solely one party, therefore linked parties in this case such as Nations Petroleum, health Department, health office, NLR, indigenous leaders (Kepala Ulayat, Kepala Adat), head of village, religious leader, youth organization or women organization in village are expected to work together. Sharing responsibilities between corporate and local government and element of communities are proposed to develop and maintain health facilities which had been built.
Q1
129 Informant Of course, implementation of CSR in very remote areas such as in Rombebai Block need roles of any linked party. Commitment which had been agreed of each stakeholder must be respected not to be lips service only.
Q2
142
Researcher
This chart describes that it is getting closer every day, namely pustu and cadre or health post, like satellite. If similar system like this is put in place and improved, the coverage can surely be expanded. Since remote area is very costly, not only in terms of transportation, but also the human resources and time are limited, everything is limited, an integrated approach, where we will bring various programs into the area, is highly needed.
F
157
Informant
So how many ethnicities / tribes are there, Sir? Five? What are the ethnicities / tribes you have just mentioned, Sir? Oh, up here? There are Baitanesa, Mutiareb, Usia, Teo, Ophae, and Bukionop. So six, right? Those are from the upper areas. There is some more, namely in Kerema. They all spread….. the line leading to Mulia. Those are the villages that have not yet reached…
F
Table 8a. Continued…
No Source Transcription Remarks
171
Informant
.Dr. B statement (in English) I never thought there is a place still like this in West Papua especially something like no body cares, no nurses, no medicine and soon. After coming to this site I am very happy thanks to Nations Petroleum because I can visit my own people with their diseases where no body care for. We treated them nicely with medicine from Nations Petroleum with so much budget and soon and soon. That is my appreciation.
F
205 Informant Do you indeed recommend that all workers…take filariasis treatment?.... It seems unlikely to me that there is any transmission at all in that area.. .
E28
230 Researcher For those people in Papua who still under developing is important to encourage for behavior (knowledge, attitude and practice). They need health education. That is a community development has to go….
E44
241 Researcher Thank you for your email, I understand that these must be done carefully and these can not be carried out without win-win solution….
E54
244 Researcher HIV test never recommends as requirement for selection of workers. And be careful to refuse for such reason….
E55
265
Informant
As sharing roles and responsibilities among parties in MoU that Depkes will handle medicine and health equipments and Nations will support transportation and fee for doctors and nurses…..
E62
266
Informant
Please, coordinate a meeting between medical team and Nations Petroleum Reps. In Biak before leaving for Rombebai….Ensure all tools that they need are complete before traveling to site…
E64
272 Informant Gentlemen…. I will hold my Medical Team until….. (It is still a tentative time frame)….The medical team will be utilizing the Timothy boat at least for a week...
E66
283
Informant
I appreciate the efficiency of the program and the team in place. I am very grateful, in the name of the patients I have met there…. Dr A, will of course cooperate fully any support activity from NP or GAH, which benefits Papuan patients…… but equally we do not encourage efforts which are not cost effective and are possibly counter-productive to providing acceptable, appropriate and sustainable services…..
E74
Table 8a. continued
No Source Transcription Remarks
328
Informant
Thank you Dr A for this progress report. We certainly appreciate your efforts in Papua. I trust our team will work closely with you to carry out your recommendations in due course. Thank once again……
E105
344 Informant/
Data
The roles of government: • To support the government of Papua and Papua
Barat in order to increase accessibility, quality, and supports for public health centers and its networking including development for hospitals.
• To facilitate the government of Papua and Papua
Barat in order to increase communicable disease control and prevention such as: HIV/AIDS, malaria, leprosy, respiratory tract infection and other non communicable diseases control.
• To support the government of Papua and Papua
Barat in order to increase nutrition for community and health environment, mother and child health services.
SMT3
352 Informant Nations has agreed a mutual cooperation where Nations is responsible to build a physical facilities (renovation and construction of new Pustu), provide boat transport during the trips as well as support fees or paramedic and doctors involved in the activities and Department of health is responsible to provide medicines and equipments as well as appointment of doctors/paramedics from site regencies.
IN
353 Informant Sustainability of the project is assured through the commitment of Department of Health to take over the facilities should closings of Nations Petroleum occurs in the location
IN
377 Researcher Three photos on the cover: Yaws, leprosy child, filariasis. They are not only called neglected diseases, but also affect neglected populations….
P4
409 Informant/
Data
Affirmative action measures provide individuals from groups deemed to have suffered from discrimination, such as women and ethnic minorities, a degree of compensatory preferential treatment in access to opportunities. Affirmative action programs are intended to be temporary measures to ‘level the playing field’ and to facilitate equal opportunity. Affirmative action is necessary because non-discrimination is not, in itself, sufficient to achieve equality and it recognizes that to improve the socio-economic position of certain groups in a particular society, positive actions must be taken.
LS
Table 8a.Continued…
No Source Transcription Remarks
410 Informant/
Data
The inferior position of orang asli Papua was documented in the Principle Ideas as Background for the Drafting of the Bill of Special Autonomy for Papua Province in the form of a Self-Governing Territory. This stated that:
• 75% of orang asli Papua do not have access to proper education and the population’s average school achievement period is 5.5 years.
• 50% of orang asli Papua have never enrolled in formal education or have not graduated from Elementary School
• only 22% of orang asli Papua graduate from Elementary School
• only 10% of orang asli Papua graduate from High School
• 2% of orang asli Papua graduate from University.
LS
416 Informant/
Data
Nations Petroleum instituted a CSR health program in its work area as a response to a previous socioeconomic element of an environmental management and monitoring study that indicates health and education are the primary issues requiring the greatest attention)
IA
418 Informant A recent challenge to policy makers, it would be an expectation that CSR spending become tax deductible, which, in many developed countries have been implemented, yet not the case in Indonesia. For Nations Petroleum, starting CSR during exploration phase is meant to create a significant value to the local community where they can benefit from a better health service and facilities at early stage of operation, as well as to gain support, trust and commitment to both parties company and the local people .
IA
425 Researcher I participated in oil and gas workshop ….in May 2008 for IPA conventions in Jakarta and those all 4 presenters were asked by moderator “what is the greatest challenges in CSR”. All presenters said, the challenges were dealing with stakeholders…
EGG
431 Informant Commitment of Nations to support of community in health sector is very expensive and deep meaning….
EGG
436 Informant We want to collaborate with Department of health because people from field were concerned with contagious diseases and at that time there was autonomy regulation in Papua…We are concerned for environmental care.
Int.A
Remarks: Data are from: P= Progress Report; DN= Daily Notes; E= Emails; Q= Questioners= Film; L=Luky Report; O.L=Observation Luky; ;SMT=Slides Mobile Team; IN=Ivanina Nations; ; LS= Literature Study; IA=Ivanina Arry; EGG= Emails Gado-Gado (mixed); Int.A=Interview Additional
2. As cited in Munir (2006), Strauss and Corbin say (1990) theories cannot be
built with actual incidents or activities as observed or reported; that are from
raw data. A theory is built from concept, not directly from data. Concept is
resulted from the conceptualization of data: The incidents, event, happenings
are taken as, or analyzed as, potential indicators of phenomena, which are
thereby given conceptual labels. Therefore, from the transcription (Stimulus
and Action), I made headings and categories in excel program of computer,
we called it Open Coding. Open coding refers to that part of analysis which
deals with labeling and categorizing of phenomena as indicated by data. I
also put code of number/sources, so it can be easily searched if needed.
Data that were initially broken down then compared and similar incidents
were grouped together and given the same conceptual label. This process of
grouping concept at a higher, more abstract level is termed ‘categorizing’
(Dey,1998; Punch,1998 cited Mehmetoglu and Altinay, 2004).The process of
open coding to develop categories and properties may be extended/
repeated when we find new ideas/values from rereading process of
transcription or finding new additional data. Categories is roughly equivalent
to themes or variables and properties (in effect their subcategories). I
managed it in key words. To sump up, during open coding the process are:
transcription (stimulus and action)—Concept--heading—key words
(category), so it will be simple.
Based on transcription, there are 440 categories which processed in Open Coding.
However only some examples of Open Coding are given below:
Note: S= Stimulus; A= Action
Table 8b. Examples of Open coding
OPEN CODING :Examples
No Subject Heading Sources Category 2 Partnership--integrated approach--cost efficient P1 Partnership, Win-Win Solution A
4 Communication--Lets stakeholders aware P1 Communication A 10 Different perception/ interest, but want to negotiate DN Different perception S 13 Trust-giving solution DN Trust A 18 Benefits felt by community-job, health access P3 Benefits of communities S 22 Information -survey results, extreme figures P3 Issues S 53 Technology Information DN Communication: fast, technology A 54 Community welcomed and small not welcomed DN Response of community S 55 Relationship to community DN Security S 56 High commitment DN Appreciation S 66 Expectation of cost DN Different interest, threat for conflict S 72 Supports from government DN Responsibility to community A 77 Access data ,mapping health situation DN Benefits: A 78 Super efficient CSR DN Created values, cost reduction S
79 Well scheduled, linking with field activities of company, well prepared DN Cost effectiveness A
100 Good name, appreciation DN Recognition A 101 Recognition of every stakeholder DN Appreciation, Proudness,responsibility A 106 Genuine to help by corporate DN Culture of company, moral A 111 a.CSR investment in phase of exploration Q2 Serious investment, commitment A
b.Improve quality of life local people, directly touched Q2 Strong commitment A 112 a.CSR in phase exploration Q2 Strong commitment S
b.MoU Q2 clear roles of each stakeholder S 123 a. Local workers healthy, providing medical check up Q2 Benefits: company S
b. More secure workplace Q2 Benefits/values: company S c.Low absentee Q2 Benefits: company S d. Community and government considered that company cares Q2 Benefits: company S
Table 8b. Continued… No Subject Heading Sources Category
e. Company cares health and safety for workers and communities Q2 Good image, benefits S
124 Mobile health team, providing health services Q3 Kind of CSR,remote area A 128 a. CSR activities Q1 Mutual responsibilities A
b. Using and maintenance of CSR Q1 Mutual responsibilities A 129 a. Need roles of any linked party Q2 Clear roles of each stakeholder S
b. Commitment not lips service Q2 Respect A 142 Remote area is costly, limitation F Low cost effective strategies S 157 Native tribes F human right S 171 a. No body care, no nurses, no medicine F Issues, Facts S
b. Thanks to company for access people F Appreciation, respects A c. medicine and budget from company F Contribution, supports A 205 Disagreement of method intervention E28 Risk for conflict A 226 a. Reaching remote, great news for people there E42 supports:NGO A
b.Reaching remote, great news for people there E42 Accessibility: open S 230 Encourage behavior and health education E44 Empowerment A 241 Win-Win solution E54 Mutual benefits, strategy S 244 Never recomments,be careful to refuse E55 Advice A 265 MoU, Depkes for medicine, company for transporation,fee E62 clear roles of each stakeholder S 266 Coordinate a meeting ,ensure all things available E64 Check and recheck A 272 hold medical team by HSE company E66 Feeling as our own program, good response A
283 a. Appreciation for efficiency, stakeholder E74 Efficiency: preference low cost effective treatment A
b. Cooperate and supports for benefits Papua patients E74 Supports: direct to community A/S
c.Discourage efforts not cost effective E74 Efficiency: preference cost effective treatment A
d. Possible counter-acceptable,appropriate,sustainable services E74 Efficiency: preference low cost effective treatment A
328 a. Thank ,appreciate efforts E105 Appreciation:respect,trust S b. Trust, our team work closely E105 Trust: commitment S 344 1.a. To support the government of Papua, Papua Barat SMT3 Roles of Government: Central S
Table 8b. Continued… No Subject Heading Sources Category 1.b. increase accessibility, quality and supports for public health SMT3 Roles of local government by law: regulating S 2.a.facilitate the government of Papua, Papua Barat SMT3 Roles of Government: Central S 2.b.control communicable disease and non communicable SMT3 Roles of local government by law: regulating S 3.a.Support the government of Papua and Papua Barat SMT3 Roles of Government: Central S
3.b. increase nutritient,health environment, mother and child services SMT3 Roles of local government by law S
352 a.NP mutual cooperation IN Collaboration: win-win solution S b.NP responsible to build a physical facilities IN Roles of Company S c.Providing transport IN Roles of Company S d. Support fees of paramedic and doctors involved in activities IN Roles of Company S e. Depkes provide medicines and equipments IN Roles of Company S f. Appointment of doctors/paramedics from site regencies IN Roles of local government S 353 a. Sustainability assured by government take over facilities IN Sustainability :taking over by government A
b. Closing NP in the location IN Uncertainty: failure S 377 Serial neglected diseases, affect neglected population P4 Issues:poverty,social injustice, differentiation A 409 affirmative action LS Legal: preferential access to opportunities S 410 Inferior position of native Papua in background LS Special Autonomy S 416 a. Socioeconomic and environmental assessment IA Facts, based on evidence S
b.Health and education priority IA Information, Planning A 418 a.CSR,Tax deductible IA Western Perception S
b.Create significant value better health service, gain trust IA Values, trust of community,comitment A
425 Greatest Challenges in CSR EGG Dealing stakeholders,communication,commitment S
431 Commitment of NP is very expensive EGG Moral,Recognization,special,values A 436 People concerned contagious disease and special regulation Int.A Issues S
3. When I processed the open coding, I might get expression of important
categories and similarities. I copied the open coding data into other new
spread sheet. I then came to phase of Axial Coding which puts those data
back together in new ways with two steps: Step one was managing similar
categories and Step two was making connections between a category and
its subcategories.
With cut and paste techniques, I processed the Axial Coding as one by one until
empty into the new spread sheet. During axial coding, the emerging categories,
themes or patterns were validated by (1)comparing the information with other
informants, (2) comparing the emerging themes with the information obtained from
through observation and review primary and secondary documents from and about
this CSR and organizations/stakeholders, (3) checking validity of choice of themes
with selected informants (Mehmetoglu and Altinay,2006). In addition, I think ,it must
be based on true story of the process in the field.
When these initial assignments were made I grouped the subjects by categories,
for example in this exercise: category of issues, might have 4 similar items (number:
22 (Information -survey results, extreme figures); 171 (No body care, no nurses, no
medicine); 377 (Serial neglected diseases, affect neglected population) and 436
(People concerned contagious disease and special regulation). More examples of
axial coding are generated using excel program of computer as follows:
Table 8c. Examples of Axial Coding(Step One)
No Heading Category Issues
22 Information -survey results, extreme figures P3 Issues S 171 a. No body care, no nurses, no medicine F Issues, Facts S 377 Serial neglected diseases, affect neglected population P4 Issues: poverty, social injustice, differentiation A 436 People concerned contagious disease and special regulation Int.A Issues S
Interest 283 a. Appreciation for efficiency, stakeholder E74 Efficiency: preference low cost effective treatment A 283 b. Cooperate and supports for benefits Papua patients E74 Supports: direct to community A/S 283 c.Discourage efforts not cost effective E74 Efficiency: preference cost effective treatment A 283 d. Possible counter-acceptable,appropriate,sustainable services E74 Efficiency: preference low cost effective treatment A
Lack of accessibility 226 a. Reaching remote, great news for people there E42 supports: GO A breaching remote, great news for people there E42 Accessibility: open S
Human Right and Social Justice 157 Native tribes F human right S
Risk Condition 22 Information -survey results, extreme figures P3 Issues S
Uncertainty, failure
353 a. Sustainability assured by government take over facilities IN Sustainability :taking over by government A 353 b. Closing NP in the location IN Uncertainty: failure S
Partnership 2 Partnership--integrated approach--cost efficient P1 Partnership, Win-Win Solution A
Table 8c. Continued… No Heading Category
Communication 4 Communication--Lets stakeholders aware P1 Communication A
53 Technology Information DN Communication: fast, technology A 425 Greatest Challenges in CSR EGG Dealing stakeholders,communication,commitment S
Different perception 10 Different perception/ interest, but want to negotiate DN Different perception S
Perception
418 a.CSR,Tax deductible IA Western Perception S
Appreciation 56 High commitment DN Appreciation S
101 Recognition of every stakeholder DN Appreciation, Proudness,responsibility A
Threat for conflicts 66 Expectation of cost DN Different interest, threat for conflict S
205 Disagreement of method intervention E28 Risk for conflict A
Recognition 100 Good name, appreciation DN Recognition A 171 b. Thanks to company for access people F Appreciation, respects A
Pride 101 Recognition of every stakeholder DN Appreciation, Proudness,responsibility A
Facts 416 a. Socioeconomic and environmental assessment IA Facts, based on evidence S
Table 8c. Continued… No Heading Category
Commitment 111 a.CSR investment in phase of exploration Q2 Serious investment, commitment A 111 b.Improve quality of life local people, directly touched Q2 Strong commitment A 328 b. Trust, our team work closely E105 Trust: commitment S 418 b.Create significant value better health service, gain trust IA Values, trust of community,comitment A
Policy, Special Autonomy 409 affirmative action LS Legal: preferential access to opportunities S 410 Inferior position of native Papua in background LS Special Autonomy S
Strategies 142 Remote area is costly, limitation F Low cost effective strategies S 241 Win-Win solution E54 Mutual benefits, strategy S
Kind of CSR 124 Mobile health team, providing health services Q3 Kind of CSR,remote area A
Empowerment 230 Encourage behavior and health education E44 Empowerment A
Trust 13 Trust-giving solution DN Trust A
328 a. Thank ,appreciate efforts E105 Appreciation:respect,trust S 328 b. Trust, our team work closely E105 Trust: commitment S 418 b.Create significant value better health service, gain trust IA Values, trust of community,comitment A
Mutual Supports 171 c. medicine and budget from company F Contribution, supports A 283 b. Cooperate and supports for benefits Papua patients E74 Supports: direct to community A/S
Table 8c. Continued… No Heading Category
Morale 106 Genuine to help by corporate DN Culture of company, moral A 431 Commitment of NP is very expensive EGG Moral,Recognization,special,values A
Respect
129 b. Commitment not lips service Q2 Respect A
Culture of company,vison and mission 106 Genuine to help by corporate DN Culture of company, moral A
Roles 112 b.MoU Q2 clear roles of each stakeholder S 129 a. Need roles of any linked party Q2 Clear roles of each stakeholder S 265 MoU, Depkes for medicine, company for transporation,fee E62 clear roles of each stakeholder S 344 1.a. To support the government of Papua, Papua Barat SMT3 Roles of Government: Central S 344 1.b. increase accessibility, quality and supports for public health SMT3 Roles of local government by law: regulating S 344 1.c.increase its networking including development for hospital SMT3 Roles of local government by law: regulating S 344 2.a.facilitate the government of Papua, Papua Barat SMT3 Roles of Government: Central S 344 2.b.control communicable disease and non communicable SMT3 Roles of local government by law: regulating S 344 3.a.Support the government of Papua and Papua Barat SMT3 Roles of Government: Central S 344 3.b. increase nutritient,health environment, mother and child services SMT3 Roles of local government by law S 352 b.NP responsible to build a physical facilities IN Roles of Company S 352 c.Providing transport IN Roles of Company S 352 d. Support fees of paramedic and doctors involved in activities IN Roles of Company S 352 e. Depkes provide medicines and equipments IN Roles of Company S 352 f. Appointment of doctors/paramedics from site regencies IN Roles of local government S
Responsibility 72 Supports from government DN Responsibility to community A
101 Recognition of every stakeholder DN Appreciation, Proudness,responsibility A
Table 8c.Continued… No Heading Category 128 a. CSR activities Q1 Mutual responsibilities A 128 b. Using and maintenance of CSR Q1 Mutual responsibilities A
Positive attitude 272 hold medical team by HSE company E66 Feeling as our own program, good response A
Benefits
18 Benefits felt by community-job, health access P3 Benefits of communities S 77 Access data ,mapping health situation DN Benefits: A
123 a. Local workers healthy, providing medical check up Q2 Benefits: company S b. More secure workplace Q2 Benefits/values: company S c.Low absentee Q2 Benefits: company S d. Community and government considered that company cares Q2 Benefits: company S e. Company cares health and safety for workers and communities Q2 Good image, benefits S
Creating Values 78 Super efficient CSR DN Created values, cost reduction S
123 a. Local workers healthy, providing medical check up Q2 Benefits: company S b. More secure workplace Q2 Benefits/values: company S c.Low absentee Q2 Benefits: company S d. Community and government considered that company cares Q2 Benefits: company S e. Company cares health and safety for workers and communities Q2 Good image, benefits S 418 b.Create significant value, better health service, gain trust IA Values, trust of community,comitment A
Good images 123 a. Local workers healthy, providing medical check up Q2 Benefits: company S
Make different 431 Commitment of NP is very expensive EGG Moral,Recognization,special,values A
Table 8c. Continued… No Heading Category
PDCA, check and recheck 266 Coordinate a meeting ,ensure all things available E64 Check and recheck A 416 b.Health and education priority IA Information, Planning A
Effectiveness, Efficiency 79 Well scheduled, linking with field activities of company, well prepared DN Cost effectiveness A
No Heading Category 283 a. Appreciation for efficiency, stakeholder E74 Efficiency: preference low cost effective treatment A 283 c.Discourage efforts not cost effective E74 Efficiency: preference cost effective treatment A 283 d. Possible counter-acceptable,appropriate,sustainable services E74 Efficiency: preference low cost effective treatment A
Security 55 Relationship to community DN Security S
Response to community
54 Community welcomed and small not welcomed DN Response of community S
Sustainability 353 a. Sustainability assured by government take over facilities IN Sustainability :taking over by government A
Axial coding is the process of relating codes (categories and properties) to each
other, via a combination of inductive and deductive thinking, grounded theorists
emphasize causal relationship, and fit things into a basic frame of generic
relationship (Borgatti, accessed on 11/26/2009 and Munir,2006). From entire
process of Axial Coding in this study, 72 groups of categories were made.
Table 8d. Group of Categories acceleration issues advocacy appreciation benefits change communities carefulness confirmation of strategies communication commitment community participation creating values culture of company depend on nature different perception direct to communities effectiveness efficiency efforts similar perception empowerment exit strategy expensive operation facts failure good images
hope/ expectation/ dream human right and social justice information infrastructure development interest integrated approach investment kind of CSR lack of accessibility lack of infrastructure legal learning make different moral mutual supports negative attitude normal/normative partnership PDCA/ check and recheck perception pilot project policy/ special autonomy politics positive attitude
poverty power pride protection of diseases quality of program recognition respect responsibility response community risk condition security special action social capital strategies sustainability team work technical health issues technology threat for conflict transparency trust uncertainty uniqueness vision and mission
4. During copy and paste in excel spread sheet in order to grouping similar
categories as mentioned above, the researcher got expression of frequency
of categories and its relationship. In order to understand and test its
comprehensive relationships in this axial coding. I drew it with freehand in a
large piece of paper .I tried making connections among them of all important
categories and subcategories focused for a cognitive process which offers a
consensually valid and informative link between stimulus and action.
5. From that process, I selected core categories or some related categories
were merged and made its links, we called it Selective Coding. This selective
coding formed the initial theoretical framework. Dick (accessed on 8/19/2002)
said after a time one category (occasionally more) will be found to emerge
with high frequency of mention, and to be connected to many of the other
categories which a re emerging. This is a core category. It is hazardous to
choose a core category too early in data collection. Furthermore, Munir
(2006) explains researchers in Grounded Theory always try to find the
dominant process from a social situation.
Figure 33. Freehand writing for testing connection s of categories & sub categories (Step Two)
When doing this assignment, I selected core categories and its categories/sub
categories which link each other as we can see in the large of paper, the
connections among categories were lined by pencil. Core categories and its
categories are found as follows:
a. Role of Stakeholders (donating, regulating, implementing, mediating and
sustaining)
b. Issues (risk condition/ environment; poverty; human right & social justice; lack
of infrastructure; lack of accessibility; facts; acceleration; special autonomy;
responsibility; interest of stakeholders; politics; MDGs )
c. Cost effective Strategies (Combined program, low cost effective treatment,
communication, direct involvement, interest stakeholders; technology ; win-
win solution; alliances, poverty alleviation; pilot project; special actions; team
work; integrated approach; empowerment; mutual supports; MoU /contract)
d. Trust and Morale: Trust (transparency; commitment; Satisfaction;
perception; quality) & Morale (responsibility; attitude; culture-vision &
mission; respect)
e. PDCA :preparation, coordination/implementing, arrangement; learning
process; quality; monitoring/evaluation; communication)
f. Recognition : Appreciation (using logo, acknowledgment, rewards); respects;
values of differentiation ; satisfaction; pride (award, responsibility, different
experience);quality of services
g. Creating Values : direct benefits ( company, community, government, NGO);
cost reduction; differentiation; good image; social capital; learning/lesson
learnt-new initiative; community participation; empowerment of local
resources, solid team; spirit; politics; awareness of government; exit
strategies: taking over by government)
6. I then described its relationships in narrative /a story, we called it Memo. The
core categories which have been developed must be the sun, standing in
orderly systematic relationship to its planets (Strauss and Corbin cited in
Pandit, 1996).
Memo continues in parallel with data collection and coding. A memo is a note
contains hypothesis/propositions, and particularly about relationships between
categories. Memo consist of comments or thoughts on incidents and linkages were
recorded initially as sentences and as the analysis moved on they were updated and
formulated as long as the research still carried out. In time core category and the
categories related have saturated. By the time this happens, we will have
accumulated a large number of memos. Experts of Grounded Theory such as
Glaser, Strauss and Corbin as well Bob Dick placed that memoing are very
important. I think original theory comes from memo.
PDCA(Check &Recheck)
(4)
Cost Effective
Strategies(2)
TrustMorale
(3)
Recognition(5)
Issues(1)
CreatingValues
(6)
Company NGO
Government
DonatingMediating
Implementing
Regulating
implem
enting
Sus
tain
ing
Corporate Social Responsibility in Uncertainty, rem ote area (MEMO)
People
Profit Planet
Role of Stakeholders
Figure 34. Memo of CSR and Stakeholder relationshi p
Theoretical Memo
To implement Corporate Social Responsibility (CSR), any party or stakeholder should
understand the ethical philosophy of Triple Bottom Line: there is a balance among Profit,
Planet and People. The philosophy should be a foundation for stakeholders’ action or roles of
stakeholders. Working with stakeholders has objective for Value Maximizing. This CSR
started with addressing issues such as high communicable disease (health), remote areas,
environment, human rights , and interests of stakeholders and later we realized about special
autonomy regulation. It takes time to deal with stakeholders until we found the stakeholders
agreed with cost effective strategies such as using low cost effective strategies interventions,
integrated approach, and principles of win-win solution. Cost effective strategies also ensures
sustainability. We then arranged clear roles of every stakeholder such as donating,
implementing, regulating, mediating, and sustaining. One NGO at the time acted as a
mediator to bridge between company and other stakeholder (government). We encouraged
trust and morale by transparency; commitment; satisfaction; quality; and improving
responsibility; attitude; culture-vision & mission; respect. All these works were challenging
and need perseverance because some actors had different perception. With system PDCA
(Planning, DO, Check and Action) which I prefer to say “check and recheck mechanism” we
tried to make the CSR in place. It was clear that all parties/stakeholders involved using this
system such as for coordination: preparation, doing learning process; quality; monitoring;
evaluating ; communication. We learned very much for company side for PDCA cycle.
However the results were not fully achieved yet until we learned about recognition such as
appreciation (using logo, acknowledgment, rewards); respects; values of differentiation ;
satisfaction; pride(award, responsibility, different experience);quality of services.” We put all
flags raising and flapping so any party can be felt appreciated”. Finally, we gained Creating
Values such as direct benefits (to company, community, government, NGO); cost reduction;
differentiation; good image; social capital; learning/lesson learnt-new initiative; community
participation; empowerment of local resources, solid team; spirit; politics; awareness of
government (other stakeholders); exit strategies: taking over by government). This theoretical
Memo is cycling and dynamic process. They link and strengthen each other and have
reciprocal relationship.
7. Now, I have a new theory that can explain its relationship in a model of
specific context; we called it Substantive /Emerging Theory.
8. However, if we improved the specific items and make it more general, lets we
see, it might become Formal Theory. I might compare the emerged theory
with extant literature and examine what is similar, what is different and why.
Glaser and Strauss (accessed on 7/20/2009) say it is often best to begin with
generating substantive theory from data and then let formal theory or
revisions to existing formal theory emerge from substantive theory. More
studies generating substantive theory will ultimately generate and improve
formal theory.
9. Formulating theoretical propositions
These followings are, I present about model of Substantive / emerging theory
which I called it: CSR and stakeholder theory in uncertainty, remote area. I
eventually generate in broader perspectives to be a formal theory, which I called
it ” Competitive Stakeholder Theory”. I also provide statements of propositions
(conceptual relationship).
PDCA/Check & recheck
Recognition
Creating Values
Issues
Cost EffectiveStrategies
TrustMoral
Role ofStakeholdersEmbedded in
CSR philosophy
CSR & Stakeholder Theory in Uncertainty, Remote are a (Substantive Theory)
Risk environmentPoverty
Human right &Social justiceLack of infrastructureLack of accessibilityFacts
AccelerationSpecial authonomy
Remotea area/expensive
Interest StakeholderUncertainty
ResponsibilityPolitics
MDGs
Combined programs
Low cost effective treatment
Direct involvement
CommunicationInterest stakeholders
CommunicationTechnologyWin-win SolutionAdvocacyPoverty alleviation
Pilot projectSpecial action
Team workIntegrated approachempowerment
Mutual supports
ResponsibilityAttitudeCulture,Vision & mission
Respect
Commitment
Transparancy
Satisfaction
PerceptionPlanning
Coordination/implementing
Learning process
evaluation
Communication
Quality
Appreciation
Respects
Values of differentiation
Satisfaction
Pride
Quality of services
ChangeGood image
Direct Benefits
Poverty alleviationEmpowerment local resources
Community participation Solid teamCost reductionPolitics Learning Raising awareness
Infrastructure development
Social capital
Exit strategy
Implementing
mediating
Donating
Sustaining
Regulating
MoU
Monitoring
Follow up
Figure 35a.Substantive Theory
PDCA
Recognition
Creating Values
Issues
Cost EffectiveStrategies
TrustMoral
Power & ControlOf Stakeholders
Embedded inEthics/philosophy
Competitive Stakeholder Theory (Formal Theory)
EducationHumanity
Interests of stakeholder
Uncertainty
Politics
Combined programs
cost effective intervention
Communication/technology
empowerment
ResponsibilityAttitude
Culture
Respect
Commitment
Transparancy
Satisfaction
PerceptionPlanning
Coordination
Learning process
Monitoring
Communication
Quality
Respects
Values of differentiation
Satisfaction
Quality of services
ChangeDirect Benefits
Community, Company, Government, NGO(short run)
Community participation Solid team Cost reductionPolitics
Social capital and brand(long run)
Exit strategy
Implementing
mediating
Donating
Sustaining
Regulating
Health & environment
Interest of stakeholders
Law
Vision & mission
Lesson learnt-new initiative
M o U/ contract
Raising awareness
Facts (need assessment)
Win -Win Solution
Risk condition
Pride
Figure 35b. Formal Theory
PDCA
Recognition
Creating Values
Issues
Cost EffectiveStrategies
TrustMoral
Power & ControlOf Stakeholders
Embedded in Ethics/Philosophy
Competitive Stakeholder Theory
Figure 35c. Competitive Stakeholder Theory
I eventually conclude some Theoretical Propositions:
1. CSR (Triple Bottom Line Philosophy) and Stakeholder Theory are competing
theories considered as strategic management to achieve objectives through
value maximizing. The goal of Stakeholder Theory is pro all stakeholders
involved. Every stakeholder including shareholder shares and creates values
together which are useful for themselves.
2. Competitive Stakeholder Theory is a dynamic process that contributed by
Power and Control of Stakeholders embedded in ethics philosophy; existing
issues; cost effective strategies; moral and trust; PDCA; recognition and
creating values. They are continuous process and interrelated.
Assumptions
Some basic assumptions of Competitive Stakeholder Theory are given as follows:
1. Working with stakeholders enhancing capitals such as creating values
through more resources and mutual supports (man, money, materials,
knowledge, technology, opportunities, attitude, relationship, spirit, risk etc)
to achieve the objectives.
2. Stakeholders Theory primarily works with people /organizations that may
have different perception, motivation and backgrounds so managing
people, resources and interests as well as building mutual respect,
human and personal relationship together are paramount. This
Stakeholder Theory offers at least 7 dimensions to achieve objectives:
power and control of stakeholders embedded in ethics philosophy;
existing issues; cost effective strategies; moral and trust; PDCA;
recognition; and creating values.
3. Since this Stakeholder Theory can work in uncertainty, not more unlikely
it will fit for the situation of certainty, turbulence and risk.
In order to explain, how Competitive Stakeholder Theory works to achieve the
objectives through Value Maximizing, a matrix of this theory is constructed. This
matrix is imitated a model of 7-S framework of McKinsey (ten Have et al, 2003) in
explaining that variables of Competitive Stakeholder Theory are continuous process
and interrelated. Total values of this theory are created through time, innovation,
experience, respect, pride, voluntary participation of stakeholders/actors. The going
up ladders reflects continuous process of values maximization.
Table 8e. Matrix of Competitive Stakeholder Theory framework
PROCESS Existing Issues
Cost Effective
Strategies
Trust &
Moral
Power & Control of Stakeholders
Embedded in Ethics/Philosophy PDCA Recognition
Creating Values
Creating Values
Recognition
PDCA
Power & Control of Stakeholders Embedded in
Ethics/Philosophy
Trust &
Moral Cost Effective
Strategies
Existing Issues
Definition of Variables and Indicators
There are 7 key ingredients for Competitive Stakeholder Theory with definition of
the variables and the indicators of this theory, are presented as follows:
Issues , this theory starts with issues. Issue is a topic or controversy or something
needs to be solved. There are strategic issues which probably stakeholders want to
be involved. Issue opens and attracts collaboration. For examples: Millennium
Development Goals (MDGs) are global issues, 8 ways to change the world
(eradicate extreme poverty and hunger; achieve universal primary education;
promote gender equality & empower women; reduce child mortality; improve
maternal health; combat HIV/AIDS, malaria & other diseases; ensure environment
sustainability; and a global environmental sustainability). Local issues are something
being concerns in the local situation. There are stakeholders who interest to support
/solve the issue on the other hand; there are specific stakeholders which work with
specific issues.
• Health and environment, issues of health and environment being concern in
local community, company or impact of project operation.
• Poverty, state of underdevelopment. Poverty could be reflection of low
economic condition, lack of education and ignorance, culture barrier affects
underdevelopment; primitive life style; some diseases cause unproductive
and people become poorer and poorer; neglected diseases are associated
to poverty; poverty reduction strategies.
• Risk condition means surrounding or other conditions will probably threat,
affect productivity of workplace; something can create a hazard in which
need a support from other stakeholders to solve.
• Humanity is regarding issues of human right, gender, equality and
underdevelopment.
• Law is to regulate system, people; providing something guideline, policy,
reward and punishment. There are kind of law (international law, national law,
local law, company law and Adat/cultural law etc)
• Interest of stakeholders, is preference and want /willing to support the issue.
The interest is based on job, principle, vision & mission, motivation of
stakeholders
• Uncertainty is unsettled, doubted or at risk to fail. Uncertainty is involved
when a decision might lead to one of several possible outcomes and exact
outcome is not known in advance. Instead, there will be a probability
distribution of possible outcomes, which the decision makers must identify
• Politics, affair to the state or strategic issues which considered important and
affect or threaten to government.
Power and Control of Stakeholders is embedded in the spirit of ethics /philosophy
as a central position of this theory .Stakeholder theory plays with actors who have
different perception, motivation and capabilities. Roles or contributions must be clear
in mutual supports.
• Donating, those stakeholders who support for such as money, materials and
transportation; Company and Government.
• Implementing, doing or applying program in the field, carried out by the team.
• Mediating, a stakeholder who assist in encouraging partnership, make it in
harmony such as bridging between company and government; NGO
• Regulating, gives supports for law, policy, and guideline in implementing
program; government.
• Sustaining, is maintaining program; continuation; preparing exit strategy;
taking over if failure; government.
Cost Effective Strategies are plan; ways; tactic for reaching certain objectives
which concern effectiveness and efficiency. Integrated approach (bring some health
programs together to service in communities) affects economy of scale.
• Cost effective intervention, is the intervention which has been known effective
and efficient for example those are recommended by World Health
Organization.
• Win-Win Solution, refers to situation can be accepted by all stakeholders
including sharing supports.
• Direct involvement , is all stakeholders join in the meeting and field
implementation as well as control it together.
• Interests oft stakeholders are preference of stakeholders for the strategies
that concern of cost effective
• Communication , is the act of making known, use of technologies such as
emails, telephone, and teleconference save in cost and time. This ensures
transparence.
• Empowerment, is use of local resources and capabilities to help them self,
such as training cadres, use local workers.
• MoU , is formal agreement among stakeholders, this agreement explains
roles and contribution of each stakeholder including exit strategy.
Trust and Moral is a superior state /characteristic of a person/stakeholder to
respond something good. Trust and moral can be built. It is a process.
• Responsibility, is a state of being responsible, that for which any
one/stakeholder, a duty, a charge. Social issues such as health, poverty,
community development including environment are basically responsible for
all.
• Attitude, is a state of mental or moral to react something.
• Culture, Vision & Mission, refers to a formal statement of a
company/stakeholder in their profile. Vision ensures that everybody knows
the target should be achieved in the certain period and what they have to do
to reach the goal. Mission explains reasons of existence of the organization
(raison d’etre).The mission should be simple or understandable, and
communicable to others. Corporate culture is a value that can be
implemented and developed as well as functioned as a cohesive system.
• Respect, is to esteem; to honor any stakeholder.; efforts to find win-win
solution.
• Commitment is to entrust; to perform; serious to support; total in participation.
• Transparency is openness; appear; sharing information to any stakeholder
including activities, strategies, and cost.
• Satisfaction, is a feeling of gratitude; no objections; fulfill state; receive good
response/ feedback
• Perception is intuitive judgment to respond something. Perception can be
improved.
PDCA is Plan-Do-Check-Act cycle. This terminology was introduced by W.Edwards
Deming, American statistician and professor. This approach, I prefer to say like
“Check and Recheck”. This is a continuous improvement and cycling process to
minimize errors to achieve the target.
• Planning, is a design; a scheme to achieve the target; to arrange before
hand; preparation mentions such as time, place, persons, equipments, cost
and target.
• Coordination is equal in degree; efforts to share information and respect.
Communication to peers/among stakeholders
• Doing, is performing; implementation; intervention; executing; carried out
program by team.
• Monitoring is a process of keeping order. Monitoring can be indirect through
reports/progress reports or direct through supervision in the field including
follow up; giving feedback; taking immediate action for correction if
necessary.
• Learning process, is lesson learnt; learning through experience: bad or good
or experiment/trial and errors. It is a self evaluation.
• Communication, is the act to making known; intercourse by speech,
correspondence, message; passing information among stakeholders
including advocacy.
• Evaluation, is determining the value; seeing the progress, a self assessment
and assessment by peers/ professionals.
• Quality is degree of excellence; performing perfect,; minimizing errors ; follow
right protocol/guideline, accepted by academics and professionals.
Recognition , is expression to acknowledge someone or other people formally and
informally; respect to other stakeholders; success and failure of the initiatives always
consider team work; it is non material and significant for accelerating
• Respect is to esteem; to honor; do not underestimate; every stakeholder is
important; involving in meeting and decision making; a glue for building
relationship among stakeholders.
• Values of Differentiation is unique approach; unusual; outstanding; distinctive
approach; beyond expectation; added values; have more power in the
matters of such as economics; politics and humanity; useful for
study/research ; a part of competitive strategy.
• Satisfaction is a feeling of gratitude; no objections; fulfill state; receive good
response/ feedback; can stimulate to participate more.
• Pride is a self respecting; appreciation of part of the success; award;,
responsibility; different experience
• Quality of Services is degree of excellence; performing perfect,; minimizing
errors ; follow right protocol/guideline, accepted by academics and
professionals.
• Change is real progress; proven good results/benefits.
Creating Values is a way of focusing managers is on strategy to achieve better
alignment. Managing for values, means using the right combination of capital and
other resources to achieve objectives. Value is worth, high quality and asset. The
values can be felt in the short run and the long run for all stakeholders involved.
• Direct Benefits for all stakeholders are materials and non materials
advantages directly felt by every stakeholder who can be in the short run or in
the long run.
• Community participation is a part of empowerment from community side. It
will ensure sustainability.
• Solid team is a strong team; alliance; good collaboration
• Cost reduction, refers to decreasing cost for doing something; feel easier to
do due to minimal cost, mutual supports, minimizing errors, integrated
approach etc; reach economies of scale where output increases and cost
falls; a part of competitive strategies.
• Politics is activities that well recognized by government; outstanding
relationship such as company to government and company to community,
government to community, NGO to government; a part of value of
differentiation; outstanding supports from government; mobilize resources.
• Learning/new initiative is valuable experience, convincing results stimulates
new initiatives; sustainability; discovery/invention.
• Raising awareness is all stakeholders aware that they can do something, a
part of sustainability
• Social Capital and brand (long run) is intangible assets; non material values:
relationship, good image, loyalty, license to operate; a part of value
differentiation/ competitive strategies.
• Exit strategy is taking over to government or other stakeholders if operation
fails; sustainability.
5.1.2 Validation of the theory
Glaser and Strauss (1967, accessed on 7/20/2009) say a good practical
ground theory should have some characteristics namely fit the substantive area it will
be used in, understandable by laymen in that area, general enough to apply to many
situations in the area and allow the user some control over the theory as the daily
situation change over time. In addition, Glaser suggests validity in its traditional
sense is consequently not an issue in GT, which instead should be judged by fit,
relevance, workability and modifiability (Glaser, accessed on 7/20/2009). I prepare it
in a check list as presented below:
Table 8f. Validation of theory based S-O-R Paradig m.
No Elements Confirmation of Informants
Management Action • Use External Agents of Change Yes • Planning and control formality Planning yes, control, not
sure – maybe in part • Control of the pace of change Yes, but not total / an
extreme change • Staff participation in decisions Yes • Justification of actions Yes • Definition of individuals’ roles Yes
Cognition
• Autonomy Yes • Resources Yes • Self-efficacy Yes • Opportunity Yes • The expected cooperation of staff Yes Environmental stimulus • Public…..OWNERSHIP…..Private Yes • Traditional…SELF-IMAGE….Modern Yes • Member….GROUP MEMBERSHIP. Independent Yes, but not obvious • Isomorphic…CONFIRMITY….Differentiating Yes • Stable…HISTORY…Threatened Not agree with the term,
prefer to HISTORY- benefit (yes) , instead of threatened
• Project…ORIENTATION….Process Yes. It is the project it self, and involve process
• High….TECHNICAL EXPERTISE….Low Yes, needed Albert Einstein (Wikipedia, accessed on 6/17/2009) puts “The supreme goal of all
theory is to make the irreducible basic elements as simple and as few as possible
without having to surrender the adequate representation of a single datum of
experience”. Partington (2000) suggests following mode 2 principles, one of the main
features of the study was involvement of informants in the validation and application
of its findings. The theory and assumptions have been a few times discussed with
key informants as well as my colleagues. Here, I would like to use S-O-R
paradigm model by Partington to validate to informants whether theory of
Competitive Stakeholder Theory is relevant to the real phenomena and is
applicable to the world of management. In conclusion, informants (managers) in
this study agreed with Competitive Stakeholder Theory that the theory considers
reliable.
5.1.3 Working out problems in doing Grounded The ory
There is an assumption that Grounded Approach is difficult and could be only
better employed by team of researchers or by a more experienced researcher who
could dealt with the complexities and contradictions of this approach (Mehmetoglu
and Altinay, 2004). Munir cited in Salim ( 2006) says Grounded Method needs the
qualified researchers who have high flying hours, self confidence, creativeness and
experience, and this is more likely not found in the young researcher. Since its
analytical model is continuous as long as field data is being collected, GT is not easy
for the beginners. However, I feel, this issue is not all true, it actually can be
improved if the researcher really involves in the field study, using modified approach
such as Mode 2, correspondence with Grounded Researcher who have experience
and last but not least perseverance and want to experiment. With this opportunity, I
would share experience in working out problems in doing Grounded Theory Method,
as follows:
1. The first critical question came to me, was the theory which I developed really
Grounded Theory? Bungin (2007) in a provocative way says that researcher
comes into the field with “empty headed” or without bringing any concept,
theory or hypothesis. It is indeed real phenomenon of what occurs in the
situation. As cited in Dick (accessed on 8/19/2002) Glaser recommends
reading widely while avoiding the literature most closely related to what we
are researching. His fear, our reading may otherwise constrain our coding
and memoing. Dick’s own view, however, is that it makes sense to access
relevant literature as it becomes relevant and part of the data collection
procedures. Reading references is less an issue for Glaser. “An effective
strategy is, at first, literally to ignore the literature of theory and fact on the
area under study, in order to assure that the emergence of categories will not
be contaminated by concepts more suite to different areas” cited in Glaser
and Strauss (accessed on 7/20/2009). Altinay and Mehmetoglu (2006) place
the enfolding literature is stage 3 or the last stage of analysis procedures of
Grounded Theory in order to asking what it was similar to, what did it
contradict and why. On the contrary, Kuhn, 1962 and Feyerabend, 1962 cited
in Crompton (accessed on 3/25/2009) observations are not entirely free from
the influences of theories. Except a framework of the study, I took time in this
study and did not have to jump into conclusion so quick and let the data
spoke for itself, and then the meanings would emerge. Partington (2000)
says that the transdiciplinary nature of mode 2 research means that pre-
existing theoretical frameworks are likely to be fragmented or rudimentary.
With the grounded theory approach this is not a disadvantage, since the
purpose of the approach is to build new theories from data in context. Mode 2
research is often aimed at capturing tacit knowledge. The retrospective,
reflexive accounts of managers and other organizational actors will be an
important source of this knowledge. One of key quotations of Deming
(Wikipedia, accessed on 6/12/2009) is “ The most important things are
unknown or unknowable”, analogous to earthquake that disrupts service,
other “earth-shattering” events that most affect an organization will be
unknown or unknowable, in advance. During the time of data collection and
process of analysis, I read relevant references and supporting documents
(literature as data) and lets the study flowed. Since I got the draft of the
theory, I finally searched more deeply references particularly references of
critics of the existing /related theory that I would produce. So this way would
not so much hinder my genuine concept. In addition, I agree, GT should be
better selected as a method only for something which not so much clear or
need to find new perceptions (Stern,1994 cited in Munir, 2006). Glaser and
Strauss cited in in Muhadjir (1996) suggest, in order achieving more optimal
level of the new theory, the grounded research should be carried out in non
traditional areas, where the place is limited references. This approach is
especially appropriate in new topic area (Eisenhardt (1989).
2. Methodology applied this study was Grounded Theory of mode 2 which paid
attention of balance between theory and practice in management. Mode 2
was clearly described the importance of involvement of participants and
researcher through multidisciplinary approaches. However, the combination
of learning from informants and interpretation of researcher did not follow the
“Hermeneutics principles by Giddens” for the qualitative approach as usual.
Giddens says we learned from informants (emic perspectives) through the
first order understanding and the second order understanding (Sanapiah in
Bungin 2003). I think, interpretations through informants who had various
backgrounds and through researcher were considered as advantage and
mutually strengthened. One core method of GT by Glaser is constant
comparisons that come from various data, so observation, interview and
review documents must be synergy. As Takeuchi (1998) says Tacit
knowledge, concerned by Mode 2, is deeply rooted in an individual’s action
and experience, as well as in the ideals, values or emotions he or she
embraces. Sociologist such as Mead and Blumer with their theories of
symbolic interaction emphasized effect of meaning and symbols towards
action and human interactions (Ritzer and Goodman, 2003). It means
interpretation of data do not solely find from interviews but from observation
and understanding of the researcher towards the social situation. Grounded
Theory needs good rapport of researcher so the researcher can take as
much as possible information. In this study, the researcher worked as
mediator/coordinator of CSR program in the study so it was very possible. In
addition, Thus, this issue should be not a problem or contradiction.
3. Overall, one of difficult parts of doing Grounded Theory that I felt was
preparation including selecting, rewriting transcription from different sources
of data. This spent a lot of time for me like “long journey” especially needed
language translation. In contrast, when I came in the phase of analysis
particularly Selective Coding, the theory arose more quickly than I imagined,
Glaser calls “drugless trip” (Dick, accessed 8/19/2002). I found such situation
was really exciting and encouraging. I could express what was really
happening in the situation. There was a feeling of freedom, autonomy and
license to write (Glaser,2002). To repeat GT principles by Glaser, it is
obvious for those who implement Grounded research should have some
capabilities namely note taking (grasping key issues), theoretical sampling
(working with diversity of samples), triangulation (constant comparison) and
the most important is theoretical sensitivity where researcher is able to get
sort of key words/ideas from the data and perceive as variables and its
relationship. It is the most creative job.
4. Issue of saturation is found in GT. Green and Thorogood (2004) comment
that GT is perhaps one of the most abused phrases in qualitative study.
Increasingly, researchers are making claims to have used a GT approach in
what emerges as rather superficial thematic content analysis. An analysis
that has used GT should provide a detailed, saturated account of data, rather
than a list of key themes. Pandit (1996) the process of developing the
grounded theory is Theoretical Sampling (1)---Data collections(2)---Data
ordering(3)---Data Analysis(4)--- theory development (5)---if theory saturation
the study finished (6) and if not saturation the study continued. From
experience, I felt saturation in the three situations; firstly I collected data from
time to time when I felt that various data (primary and secondary data) were
enough, I then stopped it. Secondly during process of open coding, similar
headings have many times come up and the kind of headings/categories
become limited and limited, I stopped the process of open coding. Thirdly,
during the process of axial coding and selective coding, I made relationship
among categories and subcategories (properties) or among core categories
and its categories. I felt diminishing returns when no more/enough
relationship produced; I stopped the process. Dick (accessed on 8/19/2002)
says in collecting and interpreting data about a particular category, in time
you reach a point of diminishing returns is saturation. It must be noted the
collection of data is a continuous process and simultaneous. Yet you have
already processed data analysis, you get other additional information/data
you should include and process it again.
5. Mode 2, of course, is simpler and shorter than traditional GT approach as
already discussed in this chapter. I think Mode 2 is significantly different if
compared Mode 1 (traditional GT) in few things such as preparation of data
(collecting and selecting data focused on Stimulus and Actions), process of
axial coding and using retrospective data as well as involvement many
informants in developing knowledge . Mode 2 overcomes the complexities of
GT.
6. Although Creswell and Clark (2007) give examples of Embedded Design
where a research embed qualitative data within a quantitative methodology,
as might be done in an experimental design or quantitative data could be
embedded within a qualitative methodology as could be done in a
phenomenology design, however in this case I could not play the mixed
methods with embedded Grounded Theory and Experimental Model to
describe each other during the Data Analysis in the Results Chapter except
in the Discussion because the objective of this qualitative method was to
build a theory. I therefore had to finish analyzing qualitative method firstly and
then analyzing quantitative method secondly. However, I believe, respectively
the quantitative results of pre and post experimental intervention, health
statistic of workplace, and Malcolm Baldrige score card in this study played a
supplemental role within the overall design namely supported strengthened ,
triangulated and qualified the main qualitative analysis in order to build a
theory finally.
5.2. Quantitative Results 5.2.1 Quantitative analysis in brief
In this quantitative analysis, I made an analysis based on the results of evaluation of Pre and
Post Health Intervention in remote Mamberamo, Papua. I described findings in proportion
and number of cases. CSR in the form of Mobile health team activities had proved to reduce
significantly communicable diseases. Parasite Rate of Malaria in Warembori decreased from
4% to 0%, Tamakuri 0% to 0%; Anasi 14% to 3% and Geza 25% to 7%. Microfilaria Rate of
Lymphatic filariasis in Warembori dropped off from 1.1% to 0%, and Tamakuri 1.8% to 0%.
We treated dramatically for leprosy (67 cases); immunization for mother and child during two
visits was about 508 people vaccinated. We have got valuable information about nutritional
status, HIV status in community. Survey with PITC approach (Provider Initiative Testing and
Concealing) was carried out. From 189 samples, we detected 4 positive reactive of HIV test
and 11 indeterminate and 27 positive reactive of syphilis test. We successfully treated some
cases of tuberculosis in adults and children. Health education had encouraged people’s life
styles. The integrated approaches were useful to give more comprehensively health supports
for community. Infrastructure development, community participation, exit strategy to take over
to government ensured sustainability of the program. Supports from health cadres, school
teachers or missionaries were helpful in the field. Results of health data in workplace showed
high Man Hours: 2.002.930 hrs, low Total Recordable incidents: 7 cases and Total
Recordable Incident Rate: 0.69 was considered as a good achievement. Self Assessment of
the management for this CSR by Malcolm Baldrige was 718 or achieving good overall score
means quality of CSR management in place. Finally, It sounds positive to say that Corporate
Social Responsibility (CSR) as one of effective efforts to reach remote areas. Partnership
with corporate will be a future challenge for health and social acceleration.
5.2.2 Mobile Health Team Activities
Location of Nation Petroleum in Rombebai was very remote in Waropen and
Sarmi districts. These places had evidently high risk of some infectious diseases
such as malaria, leprosy, lymphatic filariasis, and tuberculosis. Those diseases were
a part of global elimination programs. The places of Rombebai were not well covered
by both local health authorities. Communicable Disease Control program was totally
missing. Participation of Nations Petroleum to supports elimination/eradications of
the infectious diseases was really appreciating through its CSR/ community
development programs. These activities had not been only protecting workplaces,
but also had opened doors to taking social responsibilities to control communicable
disease in local communities. In additions, beside positive impact of local people
being employed in the location, these actions had gradually granted to people more
welcomed to the Nations Company, and raised awareness of the local government
for health situations and made the government being able to access the remote
places.
Since July 2006 – February 2008 ,the mobile health team had visited for 8 times
of the villages in remote Mamberamo with integrated approaches where the health
team provided health services of communicable diseases (malaria, TB, leprosy,
yaws ,lymphatic filariasis, diare,Acute Respiratory Infection ) , health promotion,
immunization, and recently Mother and Child program , Nutrition and HIV/AIDS
survey . Some medical doctors, midwife, nutritionists, nurses from province, Biak,
Waropen and Sarmi including community development staff of the company were
involved. The response of community for this activity was positive, where many
people came for examination and treated. It seemed that combination of mass
treatment of lymphatic filariasis, blood examination of malaria; giving bed nets,
immunization service and watching film plus health promotion were indeed
interesting for the local community. We also involved and did on the job training for
local health nurses and cadres so they would be able to help community in case
detection and to continue in mass treatment of lymphatic filariasis for those who did
not come and to follow up some patients as well. Since 2008, the place of Rombebai
has been now belongs to new born district “Mamberamo Raya”,
Society livings mostly depend on nature. They take sago (basic food) from the
forest, hunting fish and wild animals traditionally. They like to bring their family to
forest during gaining food. In the past, where there were some activities of Nations
Petroleum in Geza, many local people moved to the place and stayed surrounding
the camp. Some indigenous people were living the areas. They were illiterate and
could not communicate in Bahasa Indonesia. Teachers and health staff were very
limited in number, even buildings exist. Due to remoteness and high cost for
transportation, the supervision from district was perhaps rarely done/none. As follow
up of the Memorandum of Understanding between Depkes RI and Nations
Petroleum, the activities of mobile health team were continued and 2 sub health
centers were built and renovated. The health services of CSR to Rombebai were
implemented during seismic and drilling operation of company. It was very beginning
in phase of exploration.
Block in Gesa
Table 9a. ACTIVITIES OF OPERATION AND THE TIMING OF MEDICAL TEAM SCHEDULES (2006-2008)
October 2006
Rig mob,
Commenced
Construction of
Otus-1
.
Main survey at
work locations
(Mitiwi
/bottom part of
Tamakuri,
Warembori)
and
surrounding
area : Anasi,
Bonoi.
Note: previous
assessment started
in May 2005
December 2006
Rig arrived in
Biak,
preparation to
enter the well
location
- Survey found
malaria
filarial
and
needs
July 2007
Drilling
Otus-1 well
operation
October 2007
Continued drilling operation
Otus-1 well
November 2007
Demob drilling equipments and
reclamation
Pitohui-1
of Otus-1 and
Preparation &
Drilling
Operations
Medical
Team ,
some
previous
survey
had been
done by
the
previous
team
- TB and malaria are
found in Amite
(Upper part Tamakuri)
- Recommendation to
build
Tamakuri
Pustu in
- Malaria is high endemic in
Gesa
- Needs further surveys to
vicinity of Gesa
- Recommendation to
revitalized Posyandu in Gesa
- Bednets distribution (1300
pcs) in Gesa
- Renovate existing small
health community center in
Gesa
- Increase health education in
Gesa
Continued survey 2D seismic
Rombebai Block in Gesa
mass treatment.
Mitiwi and
Warembori are
focus area.
- Detec tion of
need to train
health cadres.
-
Shifting activities to be more in
Gesa
- Focus in Gesa and Baitanesa
- Bednets campaign in Gesa
- Trained cadres were recruited
for campaign
- Introduction to immunization
to children and pregnant mothers
- Continued mass treatment for
leprosy, tuberculosis and other
diseases
Jan-Feb 2008
Preliminary Site Survey -
Gesa locations
Construction of Puskesdes
in Tamakuri & renovation
of Pustu in Warembori
- Mobile medical team in
more
activities
comprehensive
- Recommendation to
build lab in Amitte
Seismic
Operations
Yapen-
Rombebai
seismic
acquisition
tender process
Survey 2D seismic
Rombebai Block in
Gesa
Recording 2D seismic Rombebai
Based on research design, I did mix methods. For the quantitative method, the
hypothesis was treatments and health educations through mobile health team in
local communities will reduce burden of communicable disease in the
communities in project locations and will also protect the workplace towards the
communicable diseases. John Gordon describes that this model of tree
component interactions (host, agent and environment) predicts a pattern of
disease. In short, If we can control agent in one hand, host ; people in other
hand will be healthy. With this consideration, I then developed an experimental
design of the study to make an evaluation before and after treatments by
integrated health programs with low cost effective intervention in specific location
of the remote areas.
The following findings of this quantitative study presented are Mobile Health
Team , Workplace and Malcolm Baldrige.
5.2.2 Mobile health Team
Table 9b. Demography of villages study
Name of Village Population (estimated) Remarks
Warembori 550
Yoke 460 New expansion
Tamakuri 100
Amite 250
Anasi 295
Geza 250
Geza Baru/Kerema 300
Bonoi 500
Baitanisa 200
Dadat 150 New expansion
Kamai 145 New expansion
Total 3200
2. Malaria
Activities regarding malaria program were treatment for positive cases and
giving bed nets for prevention. Evaluation of the program was eventually taken in
Warembori, Tamakuri, Anasi and Geza after 2-3 times interventions within a year
(see, table below).There were 2 methods for malaria examination namely the
first, Mass Blood Survey (MBS) the samples from mostly those who come to
health team. The second, Fever Blood Survey (FBS) selectively done for those
who have fever symptom only. Rapid Diagnostic Test (RDT) is a tool for test of
malaria. In evaluating visit, activities in Geza, Dadat and Kamai were limited
because one of traditional leaders in Geza just passed away. It was not allowed
to make crowded. Some local people were not available during this visit .People
in Kamai for instance were scared and ran into the forest during the team
activities. Many Kamai people were illiterate and could not communicate with
bahasa Indonesia.
Table 10a. Overall survey of malaria in period Dec 2006-Feb 2008
Evaluation of Malaria (MBS methods)
Village Sample Pos (%) Survey Condition
Warembori
124 5(4) 6-Dec Pre
61 0(0) 8-Feb Post
Tamakuri
135 0(0) 6-Dec Pre
44 0(0) 8-Feb Post
Anasi
105 15(14) 6-Dec Pre
32 1(3) 8-Feb Post
Geza
151 38(25) 7-Jul Pre
85 6(7) 8-Feb Post
Bonoi 199 4(2) 6-Dec Pre
Amite 60 5(8) 7-Oct Pre
Yoke 55 18(32) 8-Feb Pre
Kerema 35 7(20) 7-Oct Pre
Kamai 25 15(60) 8-Feb Pre
The table 2 above shows significantly good results after intervention of the
malaria program. Decreasing malaria cases in Anasi and Geza, diminishing
cases in Warembori and Tamakuri were occurred, even though we know malaria
transmission also depends on environmental factors including season.
Malaria after 1 year program in Rombebai
0
5
10
15
20
25
30
Villages
PR
(%)
Pre
Post
Pre 4 0 14 25
Post 0 0 3 7
Warembori Tamakuri Anasi Gesa
Figure 36. Change of malaria cases in the four vil lages
3. Filariasis
Two villages (Warembori and Tamakuri) successfully reduced the lymphatic
filariasis cases (compared between pre and post intervention). The microfilaria
rate for both the villages became zero. Evaluation is usually carried out after a
year mass treatment. The mass treatment should be repeated every year for five
years as strategic elimination.
Table 10b. Lymphatic Filariasis in the villages
Lymphatic Filariasis in Rombebai
Village Sample Chronic Pos(%) Survey Remarks
Warembori
91 0 1(1.1%) Dec-06 Pre intervention +mass treatment 1
62 0 0 ( 0%) Post intervention +mass treatment 2
Tamakuri
112 4 2(1.8%) Dec-06 Pre intervention + mass treatment 1
42 4 0 (0%) Post intervention + mass treatment 2
Anasi 88 3 6(6.7%) Dec-06 Pre intervention, not yet mass treatment
31 0 5(16%) Feb- 08 Pre intervention, mass treatment 1
Geza 98 6 24 (24%) Jul-07 Pre intervention + mass treatment 1
Bonoi 149 1 10(6.7%) Dec-06 pre intervention +not yet mass treatment
Amite 60 0 0 (0%) Oct-07 Pre intervention + mass treatment 1
Yoke 54 0 0 Feb-08 Pre intervention + mass treatment 1
Kamai Feb-08 Not yet surveyed
Dadat 4 Feb-08 Not yet surveyed
4. Leprosy
In the last visit, 4 additionally new cases of leprosy were detected in Kamai
and Dadat. Release From Treatment (RFT) indicator for 2 villages already
evaluated, showed significantly good completion of treatment (more than 80%)
under accompanied MDT (Multi Drug Therapy) approach. Health cadres and
teachers functioned as treatment observers. Significant numbers of new leprosy
cases were detected (67 cases). Again, high child case of leprosy (34%) shows
high transmission and high disability grade II (23%) shows delayed presentation.
Table 10c.Leprosy cases in Rombebai
New Leprosy Cases detected in Dec 2006 -Feb
2008
Village PB MB Remarks
Warembori 9 11 RFT 19
Tamakuri 0 0
Geza 2 8
Bonoi 6 5 RFT 11
Anasi 5 4
Baitanisa 0 2
Waitiaro 0 3
Amite 0 0
Yoke 0 0
Kerema 4 4
Kamai 0 1
Dadat 2 1
Total 28 39 Note : Among all cases, 34% of Child Cases and 23% of Disability Grade 2.
PB:Paucy Bacillary , MB: Multy Bacillary Type of clinical Leprosy)
5. Immunization
If we compared to table 11 (in November 2007) and table 12 (In February 2008),
there was increase of a coverage of routine immunization (BCG, Polio, DPT,
Hepatitis, measles). With backlog fighting, all children under five should be
immunized (details data of coverage per antigen available in provincial CDC,
Jayapura).
Table 11. Immunization in November 2007
Immunization in Nov 2007
Villages Children < 5
Tamakuri 18
Kerema 34
Geza 47
Baitanisa 7
Dadat 3
Table 12. Mother and Child Care in Rombebai
Village
Immunization Children < 5
years
Immunization Primary School
Immunization Pregnant & Productive
Female
Ante Natal Care
Personal Hygiene
Kit
Warembori 42 70 0 2 50
Yoke 43 49 1 1 75
Tamakuri 18 8 0 0 50
Anasi 23 21 8 2 50
Dadat 15 9 15 0 50
Kamai 9 0 5 1 50
Geza 4 28 11 1 75
Total 154 185 40 7 400
With concern of cold chain system, we were supported by Biak Health district
Office. Some vaccines and equipments sent by provincial health office in
Jayapura. We maintained the temperature with good cold box and good transfer
from the mother boat to the villages.
Table 13. Vaccines used for these trips
No Vaccine/antigen Sour ce: Trip 1 Total (a)
Source: Trip 2 Total (b)
Balance (a+b-used)
1 BCG none None Dinkes Province 20 vials 18 vials
BCG Dissolving none None Dinkes Province 20 vials 18 vials
2 DPT - HB Dinkes Biak 20 vials Dinkes Province 80 vials 50 vials
3 DT Dinkes Biak 50 vials Dinkes Province 10 vials 30 vials
4 TT Dinkes Biak 50 vials Dinkes Province 10 vials 40 vials
5 Hepatitis Dinkes Biak 20 shot (from Previous trip)
none none None
6 Polio Dinkes Biak 20 vials + 8 vials (from previous trip) Dinkes Province 20 vials 20 vials
7 Measles Dinkes Biak 20 vials + 17 vials (from previous trip) Dinkes Province 30 vials 40 vials
8 Measles solvent Dinkes Biak 20 vials Dinkes Province 30 vials 20 vials
6. Mother and Child program and Nutritional program
A small study about nutrition was carried out by the mobile team. The
respondents consisted of 85 children under five, 44 school children, 31 women at
productive age and 5 pregnant mothers respectively. Those samples were taken
from villages of Anasi Baru, Dadat, Gesa and Kamai.
Tabel 14. Age distribution of children under 5 for nutritional status In Anasi Baru,Dadat,Gesa and Kamai
No Age (month) N %
a < 6 13 15.3 b 6 – 12 12 14.2 c 12 – 24 15 17.6 d 24 – 36 17 20.0 e > 36 28 32.9 Jumlah 85 100
The modus of respondent was at age of more than 24 months (70.5 %).
Among 85 children, boy was 63.5 %.
In antropometry, we analized the index of Body Weight(BW) compared to
age(A),as follows:
Table 15a. Children under five with nutrition statu s based on index of BW/A In Anasi Baru, Dadat,Gesa and Kamai
No Nutritional Status n % A Over weight 0 0 B Normal/good 69 81 C Mild malnourished 14 16 D Poor/ severe malnourished 2 3
Total 85 100
From the table above, the mild malnourished was 16% and the severe
malnourished was 3%. Some mothers who had malnourished children were
interviewed. It was found that the pattern of foods was poor, no variation, namely
consisted only of cassava, papeda/sago, vegetables, and rarely fish. Frequency
of eating was only once a day with papeda. Those children in many times also
suffered from acute respiratory infection. The malnourished cases were at age of
19 months and 48 months. We brought an easy tool to measure the nutritional
status with Upper Arm Circumference, due to limitation of space in small boat
Table 15b. Distribution of nutritional status of c hildren at school age
based on BW/A in Anasi Baru and Dadat
No Nutritional status N %
A Overweight 3 9.4 B Good/normal 25 78.1 C Mild Malnourished 4 12.5 d Poor/severe malnourished 0 0
Total 32 100
Table 15c. Risk of malnutrition in children at scho ol age with LILA (Upper Arm Circumference) in Gesa
No Nutrition Status (risk for malnourism) n % a Risk of malnutrition (Lila < 23,5 cm) 8 66.7 b Non risk of malnutrition(Lila ≥ 23,5 cm) 4 33.3 Total 12 100
Table 15d. Nutrition status in children at school age in Warembori (BW/A)
No Nutritional status N % A Overweight O 0 B Good/normal 26 38.2 C Mild Malnourished 36 53 d Poor/severe malnourished 6 8.8
Total 68 100 It is clear, there was a problem in nutrition of children at school age in
Warembori. The place is actually rich with fish (protein). Food behavior consumes
less vegetables and fruits. People do not use their land and surroundings for
gardening properly.
Table 15e. Distribution of nutritional status among productive women and pregnant mothers in Anasi Baru, Dadat, Kamai, Ges a
No Nutrional status(Risk for
malnourism using LILA ) n %
a Risk of malnutrition (Lila < 23,5 cm) 22 61 b None risk of malnutrition (Lila ≥ 23,5
cm) 14 39
Total 36 100
5 pregnant mothers were examined; clinically they appeared thin and anemic.
These pregnant mothers particularly from Kamai village like smoking about 3
pieces/lintingan of tobacco per day. History of delivery baby was commonly
helped by family with cutting the umbilical cord traditionally. Pattern of foods
consisted of mainly sago and vegetables. Fish is often consumed.
Tabel 15f. Distribution of Nutritional Status among productive women based on Index of Body Mass ( IMT) in Anasi Baru an d Dadat
No Nutritional status n % a Good/Normal(IMT18 – 25) 10 66.7 b Mild malnourished(IMT≥16 - <18) 3 20 c Severe malnourished(IMT < 16 ) 2 13.7 Total 15 100
From interview, we found that pattern of food of the malnourished was not
complete and frequency of eating was less than 3 times per day. Those women
were anemic so we gave Sulfas ferosus and health education to improve their
food behavior.
We noted 2 complicated cases in pregnancy and bleeding during labor were
referred to Biak Hospital. Special boat evacuation was prepared by company to
save the mothers. Some cases of accidents/wounded were also referred to Biak
hospital with kindness of the company.
7. HIV /AIDS and Tuberculosis
Table 16. Survey HIV and STD (Syphilis) Village Population
(estimated) Sample taken
Reactive HIV positive
VDRL Positive
Warembori 550 46 0 4 Yoke 460 67 2 3 Tamakuri 100 25 0 3 Anasi 295 28 0 10 Geza 250 20 2 4 Kamai 145 3 0 3 Total 1800 189 4 27
People who came to hear a health education were asked voluntarily to give their
blood for general medical check up. The serum samples for HIV were sent to
provincial laboratory confidentially.4 reactive/positive test of HIV were detected.
11 samples of HIV were indeterminate. Kind of reagents/methods used for this
test were SD reagent, determine and Elisa. To sump up, the results showed
clearly that HIV was a problem in the remote place of Rombebai. Follow up these
results through VCT and health promotion were recommended. In addition, 2
samples of tuberculosis with AFB (Acid Fast Bacilli) positive were detected in
Yoke. Clinically, AIDS patients were seen in Yoke. There were significant
numbers of positive VDRL (27 cases), showed a problem of sexual transmitted
diseases particularly syphilis in the places.
8. Infrastructure development
The villages in this paper are now belonging to Mamberamo Raya district. New
Head of District Health Office had been elected (Mr. Rumbino) since January
2008. Consolidation in health district has been carrying out.
Renovation of sub health center was supported by Nations Petroleum were
carried in Warembori and other new construction/health post in Tamakuri.
In this visit, Depkes Jakarta supplied equipments for Pustu, health post and
mobile team (see below). Some inventory was put in NP office in Biak.
Table 17. Distribution some equipments for posyandu/health post
Distribution some equipments to the villages
Village Bidan Kit Baby weight Scale Adult weight Scale
Warembori 1 1 1
Yoke 1 1 1
Tamakuri 0 1 1
Anasi 0 1 1
Dadat 0 1 1
Kamai 0 0 0
Geza 0 0 0
Total 3 5 4
Name of health cadres trained by mobile health team as below: Warembori:
1 Lea Rumansaw : Health cadre, a wife of chief of village 2. Tabita Suaba : Health Cadre 3. Veronica Tokomonowir : Health cadre, school teacher 4. Yopie Samber : Youth organization,health cadre 5. Otniel Kowi : Youth organiation 6. Andreas Surumi : Health cadre,church worker
Tamakuri: 1.Agus (Health cadre, ex NP worker) 2.Lorina Doromi (health cadre) 3.Maskalena Awaki (health cadre) 4.Absalom Pakibori (health cadre) 5.Loisa Koridama (health cadre) 6. Esther Senggi (health cadre) Yoke: 1.Laban (health cadre) 2. Ibu Kader Anasi 1. Yosepus Nanber (health cadre,village staff) 2. Alex Karihoa (Health cadre,village staff) 3. Paulus Sembai (health cadre, school teacher) 4. Ayub Saneba (Village secretary) 5.Philemon Nakwoanum (school teacher) 6.Martha Wayoi (a wife of health cadre) Bonoi 1. Kader (Bapak) 2. Sonny Obeth Kowai (honorary nurse) 3. Permenas Kowi ( honorary nurse) Kerema
1. Sekretaris Desa (health cadre) 2. 2 youth cadres
Dadat
1. Domminggus Bubak (youth cadre) 2. Cornelius Boabu (youth cadre) 3. Tine Bubak (youth cadre) 4. Timna Worabai (youth cadre) 5. Marlina Boabu (youth cadre)
5.2.3. Workplace
Papua, as the location of some of NP’s projects, was known as an endemic
area for some contagious diseases. As Nations Petroleum put Health and Safety
as the highest priority, the company has set up some mitigation program to
ensure that the Man Power, as its most valuable resources, are safe from harm.
During the period of 1st October 2006 to 31st December 2007, Nations
Petroleum Indonesia achieved a good health and safety performance. From this
statistic that we generated from the period above was making Nations Petroleum
Indonesia’s Projects as a safer place to work.
Overall Statistic
Hazard Observation Cards : 291
Near miss : 2
First Aid Case : 31
Medical Treatment Case : 7
Restricted Workday Case : 1
Lost Time Incident : 0
Fatality : 0
Environmental Incident : 2
Equipment Damage : 2
MV Incident : 4
Snake Bites : 0
Malaria case : 110
Typhoid case : 4
Dengue fever : 1
Snake bite : 0
Vaccinations for employees & families:
1. Flu Vaccination (done)
2. Typhoid Vaccination (done)
3. Hepatitis B Vaccination (in progress)
Man Hours : 2,002,930 hrs
Total Recordable incidents : 7 cases
Total Recordable Incident Rate : 0.69 (GOOD)
Number of Incidents Based on Each Categories
0
2
4
6
8
10
12
14
16
Type Of Incident
Num
ber
of I
ncid
ent
Near miss
First Aid Case
Medical Treatment Case
Restricted Workday Case
Lost Time Incident
Fatality
Environmental Incident
Equipment Damage
MV Incident
Figure 37. Health Data in Workplace
Otus/ Pitohui
Malaria : 13 (most of the patients are local worker- Papuan)
Dengue : 0
Typhoid : 2 (contractor)
Fatality : 0
Top 10 Illness
1. Upper Respiratory Track Infection
2. Dyspepsia, Gastritis
3. Urinary Track Infection
4. Hypertension
5. Eye Disorder
6. Ear, Nose & Throat
7. Skin Disease
8. Headache
9. Myalgia
10. Mouth/ Dental
Gesa
Malaria : 95 (most of the patients are local worker- Papuan)
Dengue : 0
Typhoid : 0
Fatality : 1 (Suspected from hearth attack)
Top 10 Illness
1. Myalgia (muscle ache)
2. Other
3. Upper Respiratory Track Infection
4. Malaria
5. Skin Disease
6. Influenza
7. Abdominal
8. Fever
9. Mouth/ Dental
10. Eyes
Jakarta Office
- Malaria : 2 (NP employees)
- Dengue : 1 (NP employee)
- Typhoid : 2 (NP employees)
5.2.4. Malcolm Baldrige Score Card
The Malcolm Baldrige Quality Improvement Program provides guidelines for
improving quality within an organization. This is an electronic tool with 91 criteria
evaluated and scored for assessing overall quality performance within the
organization. The 91 criteria fall into 7 categories, as summarized below. One
manager who directly involved in this CSR was asked to make this self
assessment.
Maximum
Score Your Assessment Score Percentage 1.0 Leadership 95 70 74% 2.0 Information and Analysis 75 56 75%
3.0 Strategic Planning 60 46 76%
4.0 Human Resource Capital 150 108 72% 5.0 Process Management 140 107 76%
6.0 Quality and Operating Results 180 127 70%
7.0 Customer Satisfaction 300 204.9047619 68% Total Points 1000 718 72%
Color Scoring:
Good overall score
Caution - needs to improve
Poor - needs major improvement
Figure 38. Malcolm Baldrige Score Card
5.3 Discussion
Before I talk for discussion there is Ethiopian Proverbs is good to remember
which says “When Spider webs unite, they can tie up a lion”.
Theoretical proposition 1 finds” CSR and Stakeholder Theory are competing
theories considered as strategic management to achieve objectives through
value maximizing. The goal of Stakeholder Theory is pro all stakeholders
involved. Every stakeholder including shareholder shares and creates values
together which are useful for themselves. Though, this study carried out in
uncertain context. Learning about uncertainty is very important is similar to the
issues of certainty and risk. Douglas (1992), in his book of Managerial
Economics: Analysis and Strategy, states uncertainty is involved when a decision
might lead to one of several possible outcomes and exact outcome is not known
in advance. Instead, there will be a probability distribution of possible outcomes,
which the decision makers must identify. I encouraged seeing power and
challenge to apply stakeholder theory particularly in dynamic conditions such
uncertainty and turbulence. This CSR which applied stakeholder theory became
unique because it was starting during exploration (seismic and drilling phase)
which was unproductive and gambling. The operation eventually failed. However,
all stakeholders were happy, gained meaningful values and took over the
services to government as exit strategy. Firms and its stakeholders could use this
approach in order to bridge and to make closer to their real success or objectives.
Furthermore, Stakeholders Theory creates not only more financial resources
available but also more creativenesses, opportunities through team work. They
are mutually strengthening means minimizing risk and failure; and taking over the
risk together if it happens. I would say again Stakeholder Theory can be applied
at settled situation and at unsettled situation. I assumed if this theory can work in
uncertainty, CSR and remote area, it will be very possible to fit in other situations
such as certainty, risk, turbulence and limited resources.
I have seen the link among those original theories of CSR/Triple Bottom Line
Theory (Elkington), Stakeholder Theory (Freeman), and Competitive Advantage
(Porter) as competing theories. Porter and Kramer (2006) in their paper “Strategy
& Society: The link Between Competitive Advantage and Corporate Social
Responsibility” argue that there are relationships between corporate and society
for success which can be learned through mapping social opportunity. The
mapping explains: First, value chain that there are processed of Looking Inside
Out: Mapping the Social Impact of the Value Chain. For example: In this case,
company’s operation in remote areas impacted social economic of people
surrounding by offering jobs, trading with local people. Second, Looking Out side
In: Social Influences on Competitiveness, for example: security or stability
surroundings society improved productivity in workplace; relationship and good
reputation improve brand (intangible asset). Similarly, Freeman et al (2004) in
their paper of Stakeholder Theory and “The Corporate Objective Revisited” say
that many firms have developed and run their business in term highly consistent
with stakeholder theory. Firms such as J&J, eBay, Google, Lincoln Electric, AES
and some more provided compelling examples of how managers understand the
core insights of stakeholder theory and use them to create outstanding business.
Whereas all these firms value their shareholders and profitability, none of them
make profitability the fundamental driver of what they do. These firms also see
the import of values and relationship with stakeholders as a critical part of their on
going success. As cited in Tunggal (2008), Glen Arnold (2000) says Value- based
management is a managerial approach in which primary purpose is long-term
shareholder wealth maximization and James A. Knight (1997) states Value
Management is a way of focusing managers is on company’s strategy to achieve
better alignment, and create value. Managing for value, means, using the right
combination of capital and other resources to generate cash flow from the
business. Value management is not an event that occurs once a year but is on
going process of investing and operating decision making that includes a focus
on value creation. In this proposition, I would argue that CSR and Competitive
Stakeholder Theory articulate the shared sense of the value they create for all
stakeholders, provide managers with more resources to find success and some
extent try to gain more optimal value or value maximizing. Not only business
(shareholders) are needed value maximizing but also other stakeholders being
involved in such government, NGO (non government organization), non profit
organization as well as society. When they directly involved in, there would be
more values or superior values created and added to achieve their own
objectives/success. It is therefore if this assumption is well aware of each
stakeholder, there should be no many conflicts happened because they learn to
create values for themselves. Freeman et al (2004) add shareholders are also
stakeholders. Even though it was not so long the phase of exploration in this
study (3 years), Creating Values found were for examples: direct benefits (felt by
company, community, government, NGO, and society as well); cost reduction;
differentiation; social capital and brand; lesson learned-new initiative; community
participation; empowerment of local resources, solid team; spirit; politics;
awareness of government/other stakeholders; and exit strategies. It is unlikely
impossible the gained values will stimulate other stakeholders to create additional
or advantageous values. In this case, after closing the company operation, the
government and NGO started new initiatives to reach remote areas in bigger
scope like “Save Papua Program”.
Theoretical Proposition 2 mentions “Competitive Stakeholder Theory is a
dynamic process that contributed by Power and Control of Stakeholders
embedded in ethics philosophy; existing issues; cost effective strategies; moral
and trust; PDCA; recognition and creating values. They are continuous process
and interrelated. I put “Power and Control of Stakeholders” in the central in the
model design because the actors are in position to act and implement the
system. Philosophy / ethics must be a soul in their actions. Giddens, a British
sociologist, in his theory of Structuration puts Agent or Actor as the most
important position because Agent creates proceeding situation. His theory places
the power for actors and action in determining repetition of social practices.
Giddens recognized role of actor’s objectives (phenomenology theory) and role of
external structuration in shaping action (theory of structural functionalism)( Ritzer
and Goodman, 2003).Actors also influence social change (Aguilera et al,2007).
Many firms used Stakeholder Theory to implement CSR as presented in Chapter
One and Chapter Two. Many firms faced pro and cons, success and failures,
critiques and conflicts among them. My experience in this study, all variables in
theoretical propositions 2 were significantly linked, however we had already
addressed: clear role of stakeholders embedded in ethics/philosophy; existing
issues; cost effective strategies including win-win solution; moral and trust
including transparency and communication; PDCA (Plan, Do, Check, Action) or
check and recheck mechanism; however it seemed not enough to get maximal
achievement (Value Creations). We eventually found “Recognition “as
accelerating values to their objectives: respects including appreciation (using
logo, acknowledgment, rewards); values of differentiation; satisfaction; pride
(award, responsibility, different experience); and quality of services. We created
sense that CSR was responsible and belongs for all. We presented for all the
best for community and psychologically put all stakeholders as high as possible.
Key informants said “Basically anybody wants to be appreciated and have a good
name and may be a tendency to show who he or she is? It is important to speak
with them…. we should put them like all flags rising and flapping so any party can
be felt appreciated “. Flags in history, were recognizable as the invention, almost
certainly, the ancient Indians and Chinese. Flags had been introduced since
Chou Dynasty in 1122 BC. In Europe the first national flags were adopted in the
Middle Ages and Renaissance. Toward the end of the Middle Ages, flags become
accepted symbols of Nations, kings, organizations, cities and guilds
(Encyclopaedia Britanica,2008). In simple way, I could say when the process to
achieve objective is good, all actors /stakeholders recognize it and at the same
time they are recognized in their involvement, more voluntary and more creative
they are.
Stakeholders theory has also been debating and receiving critiques in the last
decades for instances: Lépineux, 2005; Antonacopoulou and Méric, 2005;
Mahoney, 2005; Key, 1999; Jensen, 2000; Weiss accessed in Google on
8/16/2008. However in this discussion I focused some comments only. Freeman
in 1984 originally defines Stakeholders as “any group or individual that can be
affected by the realization of a company’s objectives”. Post, in his theory called
Stakeholder view, "The stakeholders in a corporation are the individuals and
constituencies that contribute, either voluntarily or involuntarily, to its wealth-
creating capacity and activities, and that are therefore its potential beneficiaries
and/or risk bearers." For Donaldson and Preston in 1995 as cited in Weiss
accessed in Google.com on 8/16/2008, Stakeholder Theory conceives a model of
the enterprise in which “all persons or groups with legitimate interests
participating in an enterprise do so to obtain benefits, and there is no prima facie
priority of one set of interests and benefits over another”. The model rejects the
idea that enterprise exists to serve interest of its owners, be that maximizing their
wealth or some other reasons for being business. Rather, the model is based on
the idea that the enterprise exists to serve the many stakeholders who have an
interesting it or who in some way may be harmed or benefited by it. This appears
different arguments to other authors such as Freeman who said stake holder
theory is pro shareholders (Freedman et al, 2004) and my argument is pro all
stakeholder involved. Jensen (2000) explains “there is a dilemma: between a
desire to maximize the value of their companies and the demands of stakeholder
theory to take into account the interest of all the stakeholders in a firm. Value
maximizing tells the participants in an organization how they will asses their
success in achieving a vision or in implementing a strategy, but value maximizing
says nothing about how to create a superior vision or strategy and value
maximizing also says nothing to employees or managers about how to find or
establish initiatives or ventures that create value”. Key (1999) says “Stakeholder
Theory as it is currently formulated for lacking sufficient theoretical content. She
adds a theory without context and causal laws to explain process does not meet
requirements of theory. These elements must be added as part of the next step
towards the creations of stakeholder theory”. Yes, by this grounded research I
eventually said I filled these gaps through explaining how creating values/value
maximizing worked and achieved in competitive situation. Lépineux (2005)
comments the stakeholder theory fails to appreciate the place of civil society as
a stakeholder. However in this case of CSR, we put community not only as a
target and but also a subject for change. We gave them as much as benefits.
One key informant said “Thank you very much for the owners of the company for
their high and deep commitment to help human beings”. Furthermore, the
philosophy of CSR places people /society is very important, equally together with
profit /business and planet /environment. “NP’s philosophy would not have barrier
with local community. We will more involve local people than people from outside,
because we see local people have capabilities and we will invest in Papua so
local communities and surrounding areas will be developed...”. Community
development is important to the future. If society actively participates for their own
development and use their own potentials and local resources, this will ensure
sustainability. Prediction of involvement with local community from a small study
in that area showed Mean Score Agreement of Degree of Involvement with Local
Community was 3,28 (where 4: very much involved). There is an appropriate
epitaph: But of the best of leaders. When their task is accomplished, their work is
done, the people all remark ’We have done it ourselves (Morley and Love,
1986).
In this below table, I sum the differences of former stakeholder theories and new
stakeholder theory (Competitive Stakeholder Theory) that I developed.
Table 18 The differences of former and new stakehol der theory
Former Stakeholder Theories New Stakeholder Theory
Objective Value Maximization Value Maximization Leadership Hierarchy Participatory
Basic Foundation Not clearly mentioned Moral/Ethics
Center Benefit Shareholder/company All stakeholders Addressing Interest of
Stakeholders Yes, respect of interests of
stakeholders
Yes, respect of interests of stakeholders based on win-win solution and philosophy/ethics
Relationship Not clear mentioned Mutual respect and benefits
Structure of application to its
stakeholders Only a company to its
stakeholders
Company to its stakeholders; Government to its stakeholders ;
Non profit organization/NGO/society to its stakeholders
Probability areas of
application Not clearly mentioned Certainty, Uncertainty, Turbulence,
Risk Reduction, Social Responsibility, Benefits target
(time) In long run In long run and short run Process of
Values Maximizing Not clearly mentioned Clearly mentioned (7 steps)
Challenges Not clearly mentioned
Innovation,creativeness,relationship, stability, lesson learned, research
Competitive Stakeholder Theory describes clear relationship between theory
and methodology/philosophy used in this research, in the matter of important
ontological issues (what counts for reality) and epistemological issues (how
knowledge of that reality may be established). I could state that CSR,
Stakeholder Theory and Competitive Advantage are competing theories
particularly linked with how companies / stakeholders manage their environments
in order to be competitive. Partington (2000) says Grounded S-O-R theories are
concerned with how people’s understanding of their environment leads to actions.
Raimond (1998) explains that studies from a cognitive perspective have shown
us cases where a strategist’s understanding of market is outcome of an
interaction between market and strategist observing it. Durand (1998) in his
paper of The Alchemy of Competence puts the tacit/articulated distinction has
frequently been recognized as important. This distinction can only be transmitted,
recognized and thus evaluated through interaction. The cognitive limits of both
the speaker and the listener (the enunciation, the languaging, the attention paid,
the message received and understood given the existing knowledge base of the
listener, etc) will unavoidingly lead to a distorted recognition of knowledge. In that
sense, knowledge is thus necessarily tacit, at least to a certain extent. Mode 2
emphasizes tacit knowledge, which has not yet been codified, written down and
stored (Partington, 2000). Takeuchi (1998) explains that tacit knowledge, creating
new knowledge, and having everyone in the organization be involved made
Japanese companies have advanced their position in international competition.
Tacit knowledge is highly personal and hard to formalize and share with others.
Subjective insights, intuitions and hunches fall into category of knowledge. Tacit
knowledge is deeply rooted in an individual’s action and experience, as well as in
the ideals, values or emotions he or she embraces. Furthermore, tacit knowledge
contains an important cognitive dimension. Yet they cannot be articulated very
easily, this dimension of tacit knowledge shapes the way we perceive the world
around us. Skill and expertise at organizational knowledge creation is the key to
the distinctive way that Japanese companies innovate. I could say these sorts of
phenomena only can be understood if researcher is deeply involved , part of the
team as Mode 2. The researcher pays more attentions for how the managers’
attitudes, actions and reasons towards their environments including the strength
and weakness, threat and opportunity; how they find appropriate stakeholders
and solve the problems. Tacit knowledge is a dynamic process and of course
more difficult to imitate with others or rivals.
Axiological issues refer to what is quality or value in a theory?. It is often to
include ethics and aesthetics. Ethics tends to be focused on moral goods rather
than natural goods, while economics tends to be interested in the opposite.
However both moral & natural goods are equally relevant to goodness and value
theory, which is more general in scope (Wikipedia, accessed on 1/19/2010).
What values or ethics are concerned with Competitive Stakeholder Theory and
what different with the former theories? I started with the statement of Freeman
(1994, 2004) who firstly introduced this theory, he says Stakeholder theory
begins with that values are necessarily and explicitly a part of doing business and
reject the separation thesis. The objective of this theory is value maximizing.
Furthermore, Freeman et al (2004) also explains first the goal of creating value
for stakeholders is decidedly pro-shareholder. Second, stakeholders theory
claims that whatever the ultimate aim of the corporation or other form of business
activity, managers and entrepreneurs must take into account the legitimate
interests of those groups and individuals who can affect (or be affected by) their
activities (Donalson and Preston,1995; Freeman,1994). I think these two different
statements become difficult choices. Many current CSR practices with former
stakeholder theories showed some conflict of interests. In Competitive
Stakeholder Theory, I clearly state that Power and Control of Stakeholders
embedded in ethics/philosophy. For example: CSR with Triple Bottom Line
philosophy needs harmonization of three elements: profit, planet and people. If a
company and its stakeholders do not well understand and self interest where one
or two items only in Triple Bottom Line willing to apply, this collaboration may fail.
Competitive Stakeholder theory (new theory) is rich for values where recognition
of all stakeholders is the most values. Value maximizing in this new Stakeholder
theory is clearly depend on actors’ roles and behavior. Favorable relationship is
made by willingness/voluntary, creativeness, pride, trust, value chain, team work,
mutual benefits and respects, as well as win-win approach. Freeman et al (2004)
had mentioned the important relationship among stakeholders for creating
values. Stakeholders theory consists of fairness principle (John Rawls) and moral
foundation (Robert Philips) cited in Wikipedia, accessed on 1/20/2008).
Stakeholder theory and capitalism could not be separated, Adam Smith, a
Scottish moral philosopher and as the Father of Modern Economics, in his theory
of Moral Sentiments (1759) says relationship between agent and spectator or the
individual and other members of society based on sympathy “He bases his
explanation not a special “moral sense” as the third Lord Shaftesbury and
Hutcheson had done, nor on utility as Hume did, but on sympathy” (Wikipedia,
accessed on 1/19/2010). Sympathy means respect to others is a great foundation
of responsibly modern culture (Bateman and Snell , 2008)
Based on quantitative results already mentioned in the precious chapter, it
showed that CSR in the form of Mobile Health Team activities had significantly
proved the reduction of communicable diseases. Pre and post experimental
interventions within 3200 population showed Parasite Rate of Malaria in
Warembori decreased from 4% to 0%, Tamakuri 0% to 0%; Anasi 14% to 3% and
Geza 25% to 7%; Microfilaria Rate of Lymphatic filariasis in Warembori dropped
off 1.1% to 0%, and Tamakuri 1.8% to 0%. We treated dramatically for leprosy
(67 cases); immunization for mother and child during two visits was 508 people
vaccinated. Treatments here mean to cut the transmission of diseases and the
best prevention. We provided health education to community for raising
awareness. We developed new buildings for health post and sub health center.
Transfer of knowledge, skill, attitude and spirit into the team and local health
workers as well as society were provided and emphasized during the activities.
Lesson learned about collaboration among company, government (health
institution, university, NGO and society) were opened. I am very optimistic we
can do something for change such remote areas to day, where many people may
say difficult, impossible and useless. The Great British Explorer/Naturalist, Alfred
Russell Wallace, met two missioners from Germany, Carl W Ottow and Johann G
Geissler on 5 February 1855 in Mansinam Island (Manokwari), West Papua. He
was really appreciated the perseverance of two missionaries who worked in
remote areas but he doubted of their success for teaching and translating the
Good News (Bible) to indigenous people which had primitive life styles. “It is very
questionable whether it is possible to convey any idea of such a book to a people
in so low a state of civilization (Malay Archipelago, paper back edition, 2000 cited
in Kaisepo, 2008). Wallace was eventually wrong that the missionaries were
successful not only spreading Gospel but also giving the foundation of modern
culture such as school, basic health and economy.
I encouraged you to use integrated approaches in order to support community
more comprehensively and more cost effectively. Meanwhile many people and
organizations to day mostly see global issues (HIV/AIDS, Malaria, tuberculosis,
mother and child program etc) that funds and donors are available , this is an
opportunity to address the issues of local specific diseases that are neglected in
such remote areas (leprosy, yaws, lymphatic filariasis, worms etc). It is the only
way to support the neglected diseases which huge cases existing or backlog in
the neglected areas. The integrated approaches were reasonable, like Papua’s
situation with limited infrastructure, difficult geography and of course expensive
transportation. This exercise of integrated approaches impacted further for
learning and scale economies on unit costs. You can imagine such Mamberamo
is very remote and difficult to access and some tribes still living in primitive life
style, of course it is rarely visited, very expensive as well as invaluable issues in
relation to equity, human right and lesson learned.
Porter stresses that there are “two basic types of competitive advantage
namely lower cost and differentiation “ as cited in O’Shaughnessy,1996; Porter
,2004; Porter and Kramer, 2006; Hill and Jones,2004. In positioning of
Competitive Stakeholder Theory, lower cost becomes important indicators from
variable of Issues and Cost Effective Strategies. Furthermore, both lower cost
and value differentiation were significant indicators from variables of Recognition
and Creating Values. In this study, cost reduction was started with using method
of low cost effective intervention from WHO (World Health Organization) where
most drugs were available in government for free of charge. The low cost
effective strategies were simple and pro-sustainability. Government and some
NGOs preferred to use cost effective strategies, as one informant said “…but
equally we do not encourage efforts which are not cost effective and are possibly
counter-productive to providing acceptable, appropriate and sustainable
services”. Selection for appropriate stakeholders to involve in and their interests
in the existing issues as well as the cost effective strategies is important. As cited
in Cornielje ( 2007),USAID reports 80% of their failed projects do fail because of
failure to do a stakeholders analysis. Stakeholder analysis learns who are your
stakeholders ?and what is their power? .Stakeholders can be supporters,
detractors or both. The integrated programs which bring many programs together
can reduce cost compared to one program carried out a lone. ” I appreciate the
efficiency of the program and the team in place. I am very grateful, in the name of
the patients I have met there…”. From a key informant of the company stated
“We have created values through these activities. This CSR is indeed super
efficient”. Technology and communication had been significant to save cost and
time in this CSR. It was noted emails within 2 years for instances: There were
350 messages written for Mr. A; 317 messages written for Mrs. I; 53 messages
written for Mr. N; 159 messages written for NP; 117 messages written for mobile
health team; and 22 messages written for Mr. H. Telephone and teleconference
were frequently used to check and recheck the process of implementation.
Transportation to Rombebai from Biak used boat and helicopter. PDCA cycle
supported to keep programs in place and minimizing errors. Learning process by
team also reduced cost for instances: we knew what the best time to go; we
understood what community needed and how to solve the problems in
appropriate ways. Cost reduction by integrated health approaches and learning
effects contracted it into economies of scale where output increased. The
learning effects are cost savings that come from learning by doing (Hill and
Jones, 2004).
Increasing quality and control were happened because it was carried out by
team through learning process and sharing knowledge and experience. The
quality of this CSR program could also be measured in the quantitative results
but more than that when more stakeholders were joined including government
(DepkesRI) and BP Migas, more different knowledge and professionals were in
place mean that the quality of program was assured, more transparency also
happened. As generally speaking, more than two heads thinking is better than
one head. Others say when people sing a similar song in melody using various
voices of soprano, alto, tenor and bas, the results will be more beautiful and more
powerful. Stakeholder Theory works in different people with different
backgrounds. Conflict is natural. Hamel, Doz and Prahalad (2002) in their paper
of ”Collaborate with Your Competitor and Win” in Harvard Business Review say
Harmony is not the most important measure of success. Indeed, occasional
conflict may be best evidence of mutually beneficial collaboration. Few alliances
remain win-win undertaking forever. Better communication and transparency
among stakeholders increase trust to support. Other important things, there was
good response of community, it could see from many people came and
participated .Society became interested because we provided more
comprehensive services in which were not only curative but also preventive
interventions. Strategy of the “Nations Petroleum” to combine the activities of
CSR with company’s field operations was reasonable and cost effective. Dutch
Proverb says “Row with the peddles you have (but try to get a better boat in the
meantime)”.
Differentiation has centered of competitive advantage theory and important
indicator from Competitive Stakeholder Theory. In this study, even in short
duration (3 years) I had detected the differentiation. From company side, I could
say the differentiation was for instances: Commitment of company supported the
society in early stage of exploration phase; reached neglected areas with people
and its disease; significant role to support “Save Papua program” and
accomplishment by Minister of Health of Republic Of Indonesia; employed
someone who was positive HIV and 2 leprosy cases ( after treatment). This
approach is different. I noted some comments of key informants”…CSR is
actually rare done by business actors because their perception is associated to
cost/expenses thing. …My opinion about NP’s CSR program, particularly
Community Health Development (CHD) is marvelous and more than expected.
Because it is very rare an investor for oil and gas wants to provide budget for
CSR in the phase of exploration. On the contrary it is very usual companies want
to implement CSR and CHD in exploitation phase in order to all cost regarding
this program will be reimbursed to government when the companies produce oil
and gas. This is we called it “cost recoverable”…This means NP has been willing
to implement CSR program without depending on the issue of cost recovery,
because if the exploration is failed or not economical, so the block could not be
developed and the block then returned to government”. The company as a new
comer in oil and gas business in Indonesia attracted the government and NGO
through its CSR. I think this relationship to central and local government, NGO as
well as society has a political power. The company had practiced an excellent
example of human right/equity issues. One of key informant from government
said “We did not see how much money that company wishes to spend for these
activities, but the company’s commitment want to support community are very
expensive and deep meaning for us”. In addition, this case had been awarded
“Manggala Karya Bhakti Kartika” at National Health Day from Minister of Health
Republic of Indonesia in December 2008. This CSR has been selected and
presented in CSR national competition for oil and gas companies in 2008 and
used for a doctoral dissertation might increase the value of differentiation. From
other stakeholders side (government, NGO), the differentiation would be a
chance to learn and to collaborate with profit company, reaching remote area that
never accessed, of course it would have political content as well , such as
increasing trust to government that the government cares society . Morley and
Lovel (1986) say when a political change happened it is like the domino theory, it
will encourage better distribution of resources. The NGO had opportunity to
access society/remote area as expression “ I learn from Dr L in Jakarta that you
may be traveling to the Rombebai and Yapen Region for assessment of leprosy
prevalence. I think this is great news for the people there”.
O’Shaughnessy (1996) in his paper of “ Michael Porter’s Competitive
Advantage revisited “, says Porter disregards some of important determinants of
competitive advantage, his thesis of competitive advantage never transcends
economics, and therefore encourages the belief that problems soluble exclusively
through economic policy pressures. This is a deficient view: it neglects the role of
history, politics and culture in determining competitive advantage. In addition, as
example of this case, there were not only politics but also culture influenced. I
think if one investment comes to remote place there will be challenges for speed,
the society who are really depend on nature such in remote place is at risk for
facing the rapid changes. It is reasonable to do CSR at earlier stage. The similar
comments about investment development impacted to history, politics and culture
came from David Tonkin (1997), Ahmad Arif (2008) and Wibisono (2007). In
positioning of Competitive Stakeholder Theory , Politics is important indicator
from variables of Issues and Creating Values.
I also encourage companies to help society through CSR where many people
still think that CSR is like investment in the long run ( brand perspective), but this
case showed society and stakeholders entirely felt benefits even in the short run
such the phase of exploration as key informant said “ My opinion, the benefits of
this CSR are really taken in place through communities. A good CSR is carried
out and affected directly to communities in term of physical examination and
diagnose, immunization for children and pregnant mothers, laboratory
examination, treatment of communicable diseases (leprosy, lymphatic filariasis,
malaria, TBC, worms, HIV/AIDS detection), help mother in delivery babies, other
diseases including evacuation of emergency cases. Most of these services
previously never touched to communities. It was because of the location of very
remote, isolated or difficult to access “. Health intervention in community proved
that there was significant reduction of communicable diseases. Results in
workplace indicated high Man Hours (2,002,930 hrs) or high productivity among
workers. “Nations Petroleum received direct and indirect benefits from this CSR,
for examples: Healthy workers who were employed and recommended to work in
this project had been selected by medical health team ; People who live in base
camp of the company in the field are more secure, not threaten by
communicable diseases and can interact naturally with others; cost for treatment
of employees has been reduced or very minimal; Operation of the project runs
properly with very low of absentee in the workplace; experts or expatriate feel
secure to work in the field; created good image of company where communities,
workers and government considered that company cares for health and safety of
its workers and communities”. Other informant said “ … it is as a licence to
operate, communities are welcomed to us,… CSR is away to get a trust (not only
communities but also linked stakeholders. Dr.Deming (Wikipedia, accessed on
6/12/2009) mentioned The Seven Deadly Diseases of a business company
includes excessive medical costs and excessive cost of warranty, fueled by
lawyers who work for contingency fees. This effort of course reduces
unnecessary cost. ”Malcolm Baldrige Self Assessment performed “good overall
score” (718 from maximal 1000), means the quality of management was in place.
In short, it was clear now that Epidemiological model by John Gordon (balance of
Host, Agent and Environment) and CSR model /Triple Bottom Line by Elkington
(balance of people, planet and profit) had had strong relationship. Aggregating
situation as the epidemiological model , of course, strengthened the balance of
Triple Bottom Line philosophy which eventually generated the prosperities for
society and company in that area where health was a basic requirement for
development. I agree with Porter and Kramer (2006), NGOs, governments and
companies must stop thinking in terms of “Corporate Social Responsibility” and
start thinking in terms of “Corporate Social Integration”. The philosophy of CSR
(Triple Bottom Line) is indeed marvelous ,however the term of CSR has
sometimes misleading and misunderstanding among stakeholders (society,
government and NGO). It seems this issue of social responsibility merely belongs
to the company, which operate in the areas and pressures for company. In fact,
social problems such as health, education, environmental care are responsible
for all. Government/state is much more responsible than others, but sometimes
has limitation. CSR is a chance to reach community. Corporate Social Integration
means pro active effort from company side because the social relationship of
company towards society, government, NGO, other stakeholders is a precious
thing. One key person said “ …to reach the goals of company, in early
exploration phase, the company has been involving into community because
community is a part of operational activities, can not be separated. Success and
failure of well exploration is depending also on the readiness and acceptance of
the community towards our company”. I also agree with Porter and Kramer
(2006) said that efforts to find shared value in operating practices and in the
social dimensions of competitive context have the potential not only to foster
economic and social development but to change the way companies and society
think about each other. This is important things for supporting company
operation. The stakeholder theory provides this opportunity for communicating
and sharing. Corporate and society, also government and NGOs are responsible
for generating stabilities in supporting changes means ultimately increasing
economic prosperities and saving the earth.
As Law of the Republic of Indonesia Number 40 of 2007, Article 74 concerning
Limited Liability of Companies, ratified in Jakarta on 16th August 2007, has
declared. There are four points of the law are as follows (1) Companies doing
business in the field of and/or in relation to natural resources must put into
practice of CSR (2) CSR shall be budgeted and calculated as a cost based on
decency and fairness (3) Companies who do not put their obligation into practice
shall be liable to sanctions (4) CSR shall be stipulated by Government
Regulation. Though, Indonesia currently has a law of CSR, some companies
probably argue that they have paid taxes to government what for doing CSR ?
Debating has raised due to this law, however firms should consider CSR is a
strategic approach in management as advices by Peter Drucker (1974, 2008), the
Father of Modern Management, in his dimension of management; Porter (2006),
the Father of Competitive Management, states CSR can be much more than a
cost, a constraint, or a charitable deed; it can be a source of opportunity,
innovation and competitive advantage; Kotler (2008), the Father of Business
Marketing, CSR should be considered as investment and brand. I could say CSR
should be genuine, voluntary. CSR is an ethical business practice which in my
point of view is an effort by corporate and its stakeholders working together
increases the quality of life of the work place and local communities or society in
general, and share responsibilities, risk and respects. Social aspects such as
improving health and education, environmental care and community development
are basically responsible for all. In other words, CSR in one hand is an ethical
practice in modern business perspectives, in another hand, Social
Responsibilities is ethical efforts of all stakeholders in generating prosperities of
human life, saving environment and performing sustainability particularly in the
place and surrounding they work. CSR must be clearly mentioned in vision and
mission of a company. I remember words of Dr.Sam Ratulangi, an Indonesian
hero , says about a philosophy of Human functions is Si Tou Timou Tumou
Tou means “Humans live to empower others”. Prosperities should go to firms
together with society surrounding in the place of investment including other
stakeholders. There must be clear benefits for society where they work in,
company and other stakeholders involved. I encourage firms which implement
CSR, should involve government, society and NGOs together. In practice,
government sometimes was ignored and prejudiced by companies and NGO
“Why do you not to use Mr. R , an NGO expert for this CSR, Sir?... He many
times talked something bad about government; he thought his recommendations
are the best; he is not a field worker and he asked too expensive payment” a key
informant said. .Sometimes NGO which link to firm wants to work alone.
Furthermore, Government sometimes can be a risk barrier because they have
resources such as man power; equipments, regulation and political power. If
there are disasters happened for example, government has ability to mobilize
resources. In some practice, companies sometimes ignore society as subject and
do not involve them appropriately. This may threat relationship and sustainability.
NGOs in other side can be a control, in general speaking they have brave to say
wrong if it is happened so it will be balance. One key informant in this study
explained “We are from Corporate will really support for this program to be
implemented successfully, however we have some limitation about technical field
to do. But I believe this will be overcome if all stakeholders support” so the words
“Together We Can “is relevant in pushing and calling the partnership as a
challenge. To sum up, Stakeholder theory offers opportunities to enhancing
capitals not only material, financial, man power, but also knowledge, skill, spirit
,risk reduction and better relationship as well as politic. Stakeholder theory also
strengthens quality and control; they can monitor and evaluate CSR together.
Direct benefits are gained by company, society, government and NGO both in the
short and the long run. Finally I quoted one key manager’s comment in testimony
that CSR with this Stakeholder Theory “become easy, efficient and on time”.
CHAPTER SIX
CONCLUSIONS AND RECOMMENDATIONS
Before I give my conclusions and recommendations at the end of this
dissertation, there is a quotation of David Morley and Hermione Lovel (1986)
about working with other people who say “Let us agree clearly what I am to
do…Give me a real chance to do it…Give me knowledge of my progress… Give
me help when I need it…Give me recognition when I have done it”
Conclusions
Corporate Social Responsibilities (CSR) is still to day controversial issues and
many business companies are still reluctant to practice because they consider
CSR is a cost. Furthermore, some business companies practiced CSR using
Stakeholder Theory, however were caught in a dilemma: between a desire to
maximize the value of their companies and the demands of stakeholder theory to
take into account the interests of all the stakeholders in a firm. This study argues
that CSR is a strategic management and as a weapon of business firms to
become more competitive.
CSR is an ethical business practice which in my point of view is an effort by
corporate and its stakeholders working together increases the quality of life of the
work place and local communities or society in general, and share
responsibilities, risk and respects. Social aspects such as improving health and
education, environmental care and community development are basically
responsible for all.
To answer the challenges, using Mode 2 of Grounded Theory, a new theory which is called
“Competitive Stakeholder Theory ”, has been generated.
The theory in broad perspectives states that:
• CSR (Triple Bottom Line Philosophy) and Stakeholder Theory are competing theories
considered as strategic management to achieve objectives through value maximizing.
The goal of Stakeholder Theory is pro all stakeholders involved. Every stakeholder
including shareholder shares and creates values together which are useful for
themselves.
• Competitive Stakeholder Theory is a dynamic process that contributed by Power and
Control of stakeholders embedded in ethics/philosophy; existing issues; cost effective
strategies; moral and trust; PDCA; recognition and creating values. They are
continuous process and interrelated.
Values creations through this competitive stakeholder theory do not only gain more
resources (man, money, materials, knowledge, skill, spirit, and attitude) but also more
relationship, quality, transparency, cost effectiveness, risk reduction, new initiative, better
image and political meanings for all stakeholders. Specifically, such as The land of Papua
which has large areas would be future target for exploration and exploitation for natural
resources, this theory could strengthen a mutual understanding between company and
society, respect law and culture and make better relationship to other stakeholders as well
especially if it is done in early stage . In Papua and West Papua provinces where many
donors and NGOs are available, this theory will help and encourage working together for
acceleration of development. Quantitative results have been used to support the qualitative
analysis of this theory. Pre and post intervention of communicable diseases control which
covered 3200 population in this study showed respectively that Parasite Rate of Malaria in
Warembori decreased from 4% to 0%, Tamakuri 0% to 0%; Anasi 14% to 3% and Geza
25% to 7%; Microfilaria Rate of Lymphatic filariasis in Warembori dropped off 1.1% to 0%,
and Tamakuri 1.8% to 0%. We treated dramatically for leprosy (67 cases); mother and
children were vaccinated about 508 people during two visits. We provided health education
minimizing risk and other social issues. Business companies should not hesitate to
implement CSR in both unproductive and productive phase with the stakeholder approach.
CSR should become a proactive effort. The integrated health approaches were suggested
particularly in remote areas and low resources areas. As limitations of this study and space
for future research, it needs more comprehensively investigation of simultaneous CSR
progress including health, economics, environment and education during exploration phase.
It should be proposed a CSR study particularly stakeholder theory which applied both
exploration and production phases. Study of impacts of CSR in remote areas towards
communities, company, government and non government organization in the long run and
particularly emphasis of communities’ perspectives and culture changes as impact of
investment may be much interesting. Studies of this Competitive Stakeholder Theory
application in different contexts and how to measure CSR and Stakeholder Theory through
value maximizing in systematic and simple way should be more proposed.
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