Thursday, August 20, 2009

Rules for Rationals

Part 7 of Prisoners of the Real

Most inhabitants of developed societies are nervous but faithful rationalists, living uneasily at the opening of the 21st century on the intellectual capital accumulated in the 17th. The central item of their faith – in fact, the motive for most scientific pursuits – is an assumption that they will never find any phenomenon that is intrinsically incapable of exhibition as an example of some general theory.

To some extent, most human beings are also managers when exerting control over their own affairs. Using argument and analytical thinking, however, "rational managers" go further: they seek to alter and shape our world, attempting to describe infinite complexity by examining its constituent parts and very often using language that would be more appropriate for the description of machines.

For most of the last century the literature of management and organization theory has defined managers as predictors and controllers of events. Whether they focused on the process or the product, whether they stressed the importance of handling tasks or tending to maintenance, the leaders of organizations were expected to regulate and organize the activities of those "below" them and in some instances even their own co-workers.

In an essay on "organizational socialization and the profession of management", Edgar Schein, a professor at MIT's Sloan School of Management, once explained that, "The essence of management is to understand the forces acting in a situation and to gain control over them." When a student attended Sloan or other business schools, taking in the general principles of behavioral science, economics and quantitative method, the main lesson was to look at things from the perspective of high-level management, adopting a stance of pure rationality and emotional neutrality. Faced with any problem, they were expected to analyze it and come to a decision free of feelings about people, the product, the company or the community. Such was the professional manager's value system.

This model of the manager – an ethically-neutral, rational and objective professional who depends on reason, respects order and seeks above all to establish clear boundaries – is almost universally accepted among both theorists and practitioners of management science. Even the more recent definition of managers as coordinators and enlightened questioners conforms to the basic model.

According to Charles Kepner and Benjamin Tregoe, authors of the classic leadership manual titled The Rational Manager, the leaders of organizations are increasingly separated from the technical knowledge and skills of those they direct. As a result, they suggest that managers develop skills in asking questions, an approach that requires less experience and specialized knowledge. "The manager today has no choice," they claim. "With management growing progressively more complex, and experience more obsolete more rapidly, the manager must rely more and more on skillful, rational questioning, and less and less on experience."

This approach, however, differs only in its techniques from the classical style. The centerpost is still operational: how to make workers more efficient in the pursuit of institutional goals. The basic values – self-control, neutrality, discipline and efficient production – have been unchallenged since Frederick Taylor articulated the principles of scientific management in 1895.

Taylor trained as an engineer and learned the ropes with large steel companies. Growing out of his own experiences, his theory of scientific management rested on four basic steps. The first, based on the notion that there is always "one best way" to do a job, was to analyze the ideal method. Next, the manager was to select the "right man" for each job and train him in the proper method. The third step was to join the method and the man, proving Taylor's point by increasing earnings. In the end, effective division of labor was supposed to lead to the fourth step, in which the manager becomes a work "planner."

After about 20 years, the focus of Taylor's theory shifted to administrative organization. The firm, he said, was a giant machine, with ideal designs for its structure, the span of supervision, and the classification of various management activities. By the early 1950s, R.C. Davis had integrated the work of earlier theorists into a consistent approach to administration. According to Davis, organizations were abstract legal entities, formed and directed by a rational system of rules and authority. Davis described managers variously as planners, organizers, and controllers. For Davis and other classical theorists, the glue holding institutions together was a mixture of authority, responsibility, and accountability. Departments based on the product, customers, or geographic areas might divide organizations horizontally, but authority was always vertical. The flow of power always came from the top.

Such a theory had some obvious limitations, which were eventually pointed out by behavioral scientists. The classical model, for example, emphasized financial motives for work that weren't always relevant. In addition, it failed to consider other variables or to discuss problems such as motivation, choice, and informal relations. Clearly, the assumptions of the theory were either incomplete or wrong.

According to the traditional view, human organizations were really no more than machines. If that was actually true, however, the leader of an organization would only be limited by the constraints imposed by the capacities, speeds, durabilities, and costs of the machine and its parts – the employees. Clearly, there was more to running an organization than that.

Thus, in the mid-1950s, a group of so-called "radical" theorists was able to discredit classical theory and replace it with their own theory of organizational equilibrium. Working at Carnegie Tech's Center for the Advanced Study in the Behavioral Sciences, two leading "radicals," James March and Herbert Simon, launched their new movement with a devastating critique. Classical theory was obsolete, they said, because it made "severe assumptions about the environment of individuals in an organization, the impact of environment upon them and their responses to it."

Traditional theory had defined the environment as a well-detailed stimulus or system of stimuli. Each order supposedly provoked a predictable psychological form, and each form included a program for generating a specified response that was appropriate to the original stimulus. The idea was that organizations have a limited number of response programs, a stimulus for each program, and a response for each stimulus. But this mechanistic view actually produced outcomes that weren't anticipated by the theorists: associations unrelated to the task at hand were often evoked, unplanned stimuli were sometimes provided, and some stimuli failed to provoke the appropriate form.

March and Simon looked at the direction and control of large bureaucracies, morale problems, and the relationship between morale and productivity. What they found was that the demands for control made by many top managers, combined with their emphasis on "reliable" behavior, often resulted in rigidity. In addition, delegation of authority in a "classically" managed organization tended to increase conflict among departments. Although the use of impersonal rules might decrease the level of tension, it also affected behavior negatively and thus increased the gap between the organization's goals and the actual achievements.

Their conclusion was that neither classic theory nor 1930s "human relations" variants which considered morale were working. In their ground-breaking book, Organizations, they charged that the classical approach ignored the wide-range of roles that most workers performed. "It should be obvious," they wrote, "that supervisory actions based on the naive 'machine' model will result in behavior that the organization wishes to avoid."

Having established that scientific management and "human relations" approaches had failed, these behavioral theorists proceeded to offer their conditions for the survival of organizations. Their object, they claimed, was to replace "fancy with fact in understanding the human mind and human behavior," and to focus on the qualities of workers as "rational men."

Next: The Age of Adaptability

The Creative Also Destroys

Deconstructing Leadership

Anatomy of Insecurity

Managers and Their Tools

The Corporate Way of Life

The Dictatorship of Time

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