Organizations and Organizing

Rational, Natural and Open Systems Perspectives

W Richard Scott, Gerald F Davis, Gerald Davis

• Publisher: Routledge
• Year: 2015
• ISBN:
  9781317345916
• Edition: 1
• Topic: Social Sciences
• Subtopic: Sociology
• Index: Social Sciences

This broad, balanced introduction to organizational studies enables the reader to compare and contrast different approaches to the study of organizations. This book is a valuable tool for the reader, as we are all intertwined with organizations in one form or another. Numerous other disciplines besides sociology are addressed in this book, including economics, political science, strategy and management theory. Topic areas discussed in this book are the importance of organizations; defining organizations; organizations as rational, natural, and open systems; environments, strategies, and structures of organizations; and organizations and society. For those employed in fields where knowledge of organizational theory is necessary, including sociology, anthropology, cognitive psychology, industrial engineering, managers in corporations and international business, and business strategists.

CHAPTER 1

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The Subject Is Organizations; The Verb is Organizing

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The recurrent problem in sociology is to conceive of corporate organization, and to study it, in ways that do not anthropomorphize it and do not reduce it to the behavior of individuals or of human aggregates.

GUY E.SWANSON (1976)

Organizations play a leading role in our modern world. Their presence affects—some would insist that the proper term is infects—virtually every sector of contemporary social life. This book is about organizations—what they are and what they do, how they have changed, and how people have thought about them and studied them.

One theme of the book is commonality. Organizations share certain features that differentiate them from other social forms. Students of this field believe that we can understand much about a specific organization from knowing about other organizations. Understanding how a factory functions can illuminate the workings of a hospital; and knowledge of a software company can help us understand the workings of a prison. A second theme is diversity. Although organizations may possess common, generic characteristics, they exhibit staggering variety—in size, in structure, and in operating processes. What kinds of organizations exist also varies over time. Just as organizations vary, so do those who study them. Students of organizations bring to their task varying interests, tools, and intellectual preconceptions. Some study individuals and groups in organizational contexts, while others examine organizations as basic units in themselves. Still others see the character of a nation’s organizations as providing insights into its overall social structure. And some scholars focus primarily on the structural attributes of organizations, whereas others emphasize the processes that reproduce and change them.

In this chapter we introduce three influential perspectives as competing definitions of organizations. We have our first encounter with rational, natural, and open system conceptions. The subsequent three chapters are devoted to an intensive examination of these perspectives, which have shaped and continue to govern our understanding of organizations.

THE IMPORTANCE OF ORGANIZATIONS

Ubiquity

Organizations are perhaps the dominant characteristic of modern societies. Organizations were present in older civilizations—Chinese, Greek, Indian—but only in modern industrialized societies do we find large numbers of organizations performing virtually every task a society needs in order to function. To the ancient organizational assignments of soldiering, public administration, and tax collection have been added such varied tasks as discovery (research organizations); child and adult socialization (schools and universities); resocialization (mental hospitals and prisons); production and distribution of goods (industrial firms, wholesale and retail establishments); provision of services (organizations dispensing assistance ranging from laundry and shoe repair to medical care and investment counseling); protection of personal and financial security (police departments, insurance firms, banking and trust companies); preservation of culture (museums, art galleries, universities, libraries); communication (radio and television studios, telephone companies, the U.S. Postal Service); and recreation (bowling alleys, pool halls, the National Park Service, professional football teams).

How many organizations are there, exactly? Until very recently, even highly “organized” societies such as the United States did not keep accurate records on organizations per se. We kept close watch of the numbers of individuals and the flow of dollars but gave less scrutiny to organizations. It was not until the 1980s that the U.S. Bureau of the Census launched a Standard Statistical Establishment List for all businesses, distinguishing between an establishment—an economic unit at a single location—and a firm or company—a business organization consisting of one or more domestic establishments under common ownership. In 2002, the U.S. Census Bureau reported the existence of 7.2 million establishments, comprising nearly 5.7 million firms. Impressive as these numbers are, they do not include public agencies or voluntary associations, which may be almost as numerous. Tax records suggest there are perhaps two million tax-exempt nonprofit organizations, of which upwards of 400,000 are sizable nonreligious organizations required to file with the IRS, including charities, foundations, political organizations, and other nongovernmental organizations (NGOs).

The first attempt to create a representative national survey of all employment settings in the United States was carried out during the early 1990s by a team of organizational researchers (Kalleberg et al., 1996). To conduct this “national organizations study,” Kalleberg and associates developed an ingenious design to generate their sample. Because no complete census of organizations existed, they began by drawing a random sample of adults in the United States who were asked to identify their principal employers. As a second step, data were gathered by telephone, from informants in the organizations named as employers, regarding selected features of each of these employment settings, in particular, human resources practices. This procedure resulted in a random sample of employment organizations (establishments), weighted by size of organization (Kalleberg et al., 1996). Their results indicate that, as of 1991, 61 percent of respondents were employed in private sector establishments, 27 percent in the public sector, and 7 percent in the nonprofit sector (1996: 47).

Even though organizations are now ubiquitous, their development has been sufficiently gradual and uncontroversial so they have emerged during the past few centuries almost unnoticed. The spread of public bureaucracies into every arena and the displacement of the family business by the corporation “constitutes a revolution” in social structure, but one little remarked until recently.

Never much agitated, never even much resisted, a revolution for which no flags were raised, it transformed our lives during those very decades in which, unmindful of what was happening, Americans and Europeans debated instead such issues as socialism, populism, free silver, clericalism, chartism, and colonialism. It now stands as a monument to discrepancy between what men think they are designing and the world they are in fact building. (Lindblom, 1977: 95)

Organizations in the form that we know them emerged during the seventeenth to eighteenth centuries in Europe and America, during the period of political and economic expansion occasioned by the Enlightenment period. Not only did organizations rapidly increase in number and range of applications, but they also underwent a transformation of structure as formerly “communal” forms based on the bonds of kinship and personal ties gave way to “associative” forms based on contractual arrangements among individuals having no ties other than a willingness to pursue shared interests or ends (Starr, 1982: 148).

Source of Social Ills?

The increasing prevalence of organizations in every arena of social life is one indicator of their importance. Another, rather different index of their significance is the increasing frequency with which organizations are singled out as the source of many of the ills besetting contemporary society. Thus, writing in 1956, C. Wright Mills pointed with alarm to the emergence of a “power elite” whose members occupied the top positions in three overlapping organizational hierarchies: the state bureaucracy, the military, and the larger corporations. At about the same time, Ralf Dahrendorf (1959 trans.) in Germany was engaged in revising and updating Marxist theory by insisting that the basis of the class structure was no longer the ownership of the means of production, but the occupancy of positions that allowed the wielding of organizational authority. Such views, which remain controversial, focus on the effects of organizations on societal stratification systems, taking account of the changing bases of power and prestige occasioned by the growth in number and size of organizations.

A related criticism concerns the seemingly inexorable growth in the power of public-sector organizations. The great German sociologists Max Weber (1968 trans.) and Robert Michels (1949 trans.) were among the first to insist that a central political issue confronting all modern societies was the enormous influence exercised by the (nonelected) public officials—the bureaucracy—over the ostensible political leaders. An administrative staff presumably designed to assist leaders in their governance functions too often becomes an independent branch with its own distinctive interests (Skocpol, 1985).

Other criticisms point to the negative consequences of the growth of organizations in virtually every area of social existence. Borrowing from and enlarging on a theme pervading the thought of Weber, these critics decry the rationalization of modern life—in Weber’s phrase, the “disenchantment of the world” (1946 trans.: 51). Organizations are viewed as the primary vehicle by which, systematically, the areas of our lives are rationalized—planned, articulated, scientized, made more efficient and orderly, and managed by “experts.” (See, for example, Mannheim, 1950 trans.; Ellul, 1964 trans.; Goodman, 1968; Galbraith, 1967; Ritzer, 1993; Schlosser, 2001).

A prosaic but powerful example is provided by the worldwide success of fast-food chains—the “McDonaldization of Society” (Ritzer, 1993)—which has rationalized food preparation, depersonalized employee-customer relations, and stimulated the growth of mass production techniques in agribusiness:

The basic thinking behind fast food has become the operating system of today’s retail economy, wiping out small businesses, obliterating regional differences, and spreading identical stores througout the country like a self-replicating code. America’s main streets and malls now boast the same Pizza Huts and Taco Bells, Gaps and Banana Republics, Starbucks and Jiffy-Lubes, Foot Lockers, Snip N’ Clips, Sunglass Huts, and Hobbytown USAs. Almost every facet of American life has now been franchised or chained. From the maternity ward at a Columbia/HCA hospital to an embalming room owned by Service Corporation International … a person can now go from the cradle to the grave without spending a nickel at an independently owned business. (Schlosser, 2001: 5)

These critics thus add their voices to others who have called attention to the ways in which organizational structures damage the personalities and psyches of their participants. Alienation, overconformity, and stunting of normal personality development are among the consequences attributed, not to such special cases as prisons and concentration camps, but to everyday, garden-variety organizations (see Argyris, 1957; Maslow, 1954; Whyte, 1956). And with the predominance of the service economy has come the increasing “commercialization of human feeling” in jobs such as flight attendant or salesperson, which require projecting a happy face regardless of one’s true feelings (Hochschild, 1983)—or simulated hostility, in the case of bill collectors and criminal interrogators (Rafaeli and Sutton, 1991).

Large organizations have long been subject to criticism, either because they are alleged to be rule bound, cumbersome, and inefficient (Mises, 1944; Parkinson, 1957) or because they are believed to take advantage of their size and resulting power to exploit others. Perrow (1991) asserts that large organizations increasingly “absorb” society, internalizing functions better performed by communities and civic society. And critics such as Korten (2001) point with alarm to the increasing power of the multinational corporations as they search for cheap labor, despoil the environment, and disrupt the continuity of stable communities.

We attempt to evaluate such criticisms of organizations at appropriate points throughout this volume. Here we simply note that these wide-ranging accusations and concerns regarding the pervasive negative consequences of organizations provide further testimony to their importance in the modern world.

As Media

In addition to their being mechanisms for accomplishing a great variety of objectives and, perhaps as a necessary consequence, the source of many of our current difficulties, organizations have yet another important effect on our collective lives. This effect is more subtle and less widely recognized, but it may be the most profound in its implications. It is perhaps best introduced by an analogy: “The medium is the message.” This twentieth-century aphorism was coined by Marshall McLuhan to focus attention on the characteristics of the mass media themselves—print, radio, movies, television—in contrast to the content transmitted by these media. McLuhan defines media very broadly as “any extension of ourselves”; elaborating his thesis, he notes, “The message of any medium is the change in scale or pace or pattern that it introduces into human affairs” (1964: 23, 24).

McLuhan’s thesis appears to be more clearly applicable to our subject—organizations—than to any specific media of communication. First, like media, organizations represent extensions of ourselves. Organizations can achieve goals that are quite beyond the reach of any individual—from building skyscrapers and dams to putting a person on the moon. But to focus on what organizations do may conceal from us the more basic and far-reaching effects that occur because organizations are the mechanisms—the media—by which those goals are pursued. A few examples suggest some of these unanticipated and, often, unrecognized organizational effects.

• The Federal Aviation Administration (FAA) and the North American Aerospace Defense Command (NORAD) had developed protocols for working together in the case of a hijacking but failed to take into account a scenario in which the hijacked aircraft would not be readily identifiable, would not allow time to utilize appropriate chains of command within the two agencies, and would not take the traditional form of taking hostages to an alternative destination but convert the aircraft into a guided missile. (National Commission on Terrorist Attacks Upon the United States, 2003) The events of 9/11, 2001, provided a catastrophic exception.

• Although we seek “health” when we visit the clinic or the hospital, what we get is “medical care.” Clients are encouraged to view these outputs as synonymous, although there may be no relation between them. In some cases, the relation can even be negative; more care can result in poorer health (Illich, 1976).

• While most of us believe schools are designed to increase the knowledge and skills of student participants, their major function may well be the indirect effects they have in preparing students to assume a compliant role in the organizational society: to learn how to be dependable employees (Bowles and Gintis, 1977).

• Organizations may exert only weak effects on the activities of their participants but still exert influence in situations because they embody and exemplify purposeful...