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CHAPTER 1
Introduction
This is a study of how business and industrial managers* manage. There is of course endless literature on personnel problems in industry, and a flood of guidebooks for overriding obstacles to the goals of management. This literature has an important place, but according to one high authority1 many of those who are being advised are unable to keep abreast of these encyclopedias of procedure. And a distinguished administrator has recently declared, “We do not need proof or provable theses so much as we need questions and hypotheses which will stimulate insights among practitioners.”2 Here we shall seek both to raise questions and hypotheses, and to give some supporting evidence for them.
As a study of how managers manage, this is not an effort at muckraking, or an apology, or a guidebook in disguise, or an attempt to belittle bureaucratic operations. Rather the aim is to get as close as possible to the world of managers and to interpret this world and its problems from the inside, as they are seen and felt at various points and levels. Such a project requires attention also to the counter influences between managers and firm, and the consequences for each and for the individual from what occurs in the process. Where relevance and data allow, we want to relate this world to the surrounding community. Finally we wish to describe both unique and typical experiences and events as bases for theory that is developed and related to other studies.
The case materials of the study were drawn chiefly from four firms located in or adjacent to Magnesia,* a city of Mobile Acres, a heavily industrialized region of Central United States. Three of the companies are factories: the Milo Fractionating Center, the Fruhling Works, and the Attica Assembly Company; the fourth, Rambeau Mart, is a department store. All are units of corporations with home offices located outside Mobile Acres. The Fruhling firm has a total work force fluctuating around 20,000; Milo, around 8000; Attica, 2600; and Rambeau upwards of 400. Other firms inside and outside Mobile Acres will be referred to in various contexts. I had considerable first-hand experience in two of these firms both before and concurrently with part of the inquiry,† The period of employment, the direct field work, and follow-up visits continued for over a decade.
Here we can only touch the related literature,‡ which can be roughly categorized for our purposes. Some executives, for instance, have theorized from their experiences and observations without giving specific data. Examples are Chester Barnard, who has done this with remarkable insight and detachment in his Functions of the Executive, and Lieut.-Col. Lyndall F. Urwick, whose writings are internationally renowned. Other executives have described aspects of their experiences, attacked current trends and practices in industry and business as undemocratic, inefficient, etc., and have recommended many changes. Examples are T. K. Quinn, Big Business: Threat to Democracy, and H. Frederick Willkie, A Rebel Yells.
A third group of studies are those by various editors and research teams of Fortune. Recent examples are A Guide to Modern Management Methods (largely by Perrin Stryker), The Executive Life, Is Anybody Listening? (chiefly by W. H. Whyte, Jr.), and Whyte’s The Organization Man. The data of these studies are collected through interviews, questionnaires, and statistical records from apparently a great range of firms and industries. These studies give helpful statistics, reveal flashes of insight, raise important questions, and are provocatively presented. Repeatedly we pay our respect by preying on them. However, they frequently do not get close enough to industrial situations to consistently get at covert activities and the meanings assigned to them by participants, and to spell out the consequences, in terms of individual and group actions, for the organization.
Academic studies by specialists in business and in the social and psychological sciences fall into a fourth group. These efforts may have specific departmental flavors or be interdisciplinary. Among the many we will use are Ginzberg, What Makes an Executive?; Dimock,* The Executive in Action; Zaleznik, Foreman Training in a Growing Enterprise; Newcomer, The Big Business Executive; the twin reports by Warner and Abegglen, Occupational Mobility in American Business and Industry, and Big Business Leaders in America; Learned, Ulrich, and Booz, Executive Action; Drucker, The Practice of Management; Tead, The Art of Administration; Dubin, Human Relations in Administration; Roethlisberger, Management and Morale, etc.; Kruisinga, The Balance Between Centralization and Decentralization in Managerial Control; Lombard, Behavior in a Selling Group; Scott and Lynton, Three Studies in Management; Ronken and Lawrence, Administering Change; and so forth.
The place of these studies and others—as theories about the nature of organization, as explanations for the gap between recipe and performance, as records of clash between theorists and decision-makers, as reports on careers, etc.—will be obvious throughout the book.
A participant at Milo and Fruhling, I was repeatedly puzzled by the gap between official and unofficial ways of doing things, and by the emotional splits and name-calling among associates devoted to one general approach or the other. As developed in the Appendix, this experience raised questions that I formulated as a guide for seeking answers. Returns from queries followed at Milo and Fruhling led me to utilize excellent contacts at Rambeau and Attica to look for similar problems there. In some cases I was able to see allied problems more closely, or I found conditions in one plant that stimulated further inquiry in the others.
The general approach to all firms was first to learn the issues and who was involved. Problems of recurring concern were then viewed in terms of their extent and the ramifications of behavior that kept them alive. Since the larger aspect of many problems was officially non-existent, the study is heavily concerned with unofficial behavior, though official and unofficial are reciprocal aspects of the same thing. The tug-of-war between these states of organization will be part of every problem cluster in Chapters 3, 4, 5, 6 and 7. Chapter 8 is devoted exclusively to an analysis of the nominal and nebulous poles of organization, the middle ground between them, and the interconnections that enable the paper organization to continue. Organization is seen not as a chiseled entity, but as a shifting set of contained and ongoing counter phases of action.
The recurring problem* areas we will discuss grow out of (1) pressures for economy of operation; (2) “cooperation” of officially powerless experts with their administrative superiors; (3) local meanings found by union and management in the high level work agreements to which they are subject; (4) uncertainty about the route to a place in middle and upper management; and (5) the task of recognizing and rewarding differential contributions. Both as an accompaniment and a residuum of these organizational perturbations are (6) the psychological and moral conflicts of the individual executive who must in some fashion balance the spirit and letter of the firm as he meets the claims of subordinates and associates.
Each of these six problem areas is made the subject of a chapter. There is no pretense that these are the only personnel problems, or that all aspects of each area are explored, or—most lamentable shortcoming of the effort—that the problems were investigated with equal thoroughness in each firm or in any one of the firms, or that all relevant literature has been covered. Obviously the volume of published materials, the size of the companies, and the limitations of a lone researcher forced compromises.
Milo’s formal structure and the theories of industrial organization held by its staffs are discussed in Chapter 2. These theories and the functions of staffs typify American industry. The formal chart is limited to Milo because only there could I develop a comparable chart of key managers ranked according to their relative unofficial influence (Chapter 3). Like Milo, Fruhling and Attica were staff-line type organizations under central offices. Fruhling was more complex, and Attica simpler and with fewer staffs, than Milo. Essential details of the structure of both, and of Rambeau, are presented in context.
Dealing with the social repercussions of economic pressures at Milo, Chapter 3 charts the schisms between nominal and exercised authority. An example of typical clashes between the branches of Operation and Maintenance is presented. Steps are followed in a struggle that led to creation of a formal control to reduce costs and to limit the conflict. Our observation of the control’s breakdown and the covert adaptation of one later imposed by the home office, is supplemented with a theory of cliques as the indispensable action centers and preservers of the large complex organization.
Controversies over the sphere of operations and authority of industrial staffs are discussed in Chapter 4. The out-of-role staff practices at Milo; the typical staff and line stereotypes of each other; the internal problems of staffs at Milo, Fruhling, and smaller firms; and the middle and lower line evasion of staff rules as compared with the relative harmony at top levels are typical points of departure. Disharmonies are analyzed in terms of differences in outlook, job opportunity, etc., against the restrictive background of line authority, the concerns of top management, staff need to prove itself, etc.
Chapter 5 focuses on the meaning of broad labor agreements in the local plant. Milo, Fruhling, and Attica supply case materials of local expediencies at all levels of management; and Attica points an instructive case of internal and plant-community compromises involving minority groups. With or against the contract, by adherence to one’s official camp or through union-management cliques, surface harmony and deference to the contract are merged with getting the job done. Grievance records are a clue to the compromises which are analyzed in terms of friendships, economic and production pressures, and fear of punishment by unwillingly involved top level chiefs.
Problems related to entry and climb through the hierarchy are the subject of Chapter 6. Official statements of how members rise in the firm may be given freely. But these recitals often conceal more than they reveal—and not always from intent, for spokesmen well-informed on official policy may be ignorant of relevant but more subtle factors in success. The rubbery gauge of “ability” as a measure of fitness can mean anything powerful figures want it to mean. And probably no set of objective factors can be rigorously adhered to in picking and advancing members. In an atmosphere of rivalries, this is due in part to inability of the organization either to recognize officially the out-of-role contributions that are necessarily made by some members or to reward them. Formal education in specialized subject matter is clearly not an open sesame to quick achievement of high place. But variously imparted initial drives toward education, with the attendant experiences of acquiring it, may build more potential for mastering confusion, and skill in the required social mimicry, than do supposedly more important formal factors. That is, promotion may or may not be made on the basis of nominal fitness and contributions. But survival at a given level is likely to correlate with skills not explicitly recognized, or even contrary to those formally accented. Focusing on Milo, this chapter explores official records, unofficial practices and influences, and draws heavily on supplementary literature.
Chapter 7 deals with the problem of unofficially rewarding implicit contributions to the organization, as distinct from the need to prevent misuse of the firm’s materials and services. Here the concern is to find a line between recognized theft and the unofficial use of company resources as inducements, rewards, and perquisites; and to show how ineptly used tacit reward can grow to pilfering rights. We note how various informal roles, such as theft intelligencer, faction-broker, etc., serve to carry out essential functions and are implicitly requited. Milo, Rambeau, and various small firms are sources of data that point the social and moral complications of assuming that all necessary contributions can be induced and rewarded by purely official means.
Thus the major recurring social problems of operation, threshed out by some combination of official and unofficial action, move around production costs, the relations of advisory experts and line executives, the priority of local interests over wider fealty in union-management affairs, the routes to careers, and the task of distinguishing requital from theft in compensating exceptional help that cannot be officially recognized or rewarded.
The cumulative effects of these strains on the individual executive is the topic of Chapter 9. No reward or group support can save him from the responsibility of reconciling what some see as commendable with what others see as reprehensible practices. As a pivot in the clash of policy and action, his latitude of choice leads to compromises and moral burdens. Trapped in the cross-claims of associates, he may find the organization’s demand for seemly appearances and impersonal action beyond his endowment or any aid he can command. To preserve his formal role he must constantly reinforce or adapt it by taking informal roles, and be sensitive to the same practice by others. Ambiguous situations and varying ingenuity in solving contradictions thus operate to raise or depress the influence of individual managers regardless of formal equalities they share.
The book is thus a study of compromises among key individuals and groups in rational organizations, and the human strictures on compromise. From concessive exchanges among and between vertical and horizontal groups, the study eventually generalizes on compromise between two types of managers who exist at all levels and in all formal divisions and are equally committed to serve top level administrators by specific and dignified means. On the one hand are the systematizers and routinizers to whom method and procedure are paramount. On the other hand are the adapters and reorganizers who stress ends over means. The first cling to the official as their protection. Cloaked in conformity, the second depart and innovate as they think wise—and can. The collaborative struggle of these two types is an ongoing action in which moral convictions are confirmed or outraged, and careers made or broken according to the skill and success of members in forming elastic alliances to protect themselves against unwanted change and aggression as they advance their respective views of policy, met...
