THE NEW ORGANIZATION: FROM HERE TO TRANQUILITY
ONE
Highly developed, modern, technologically based societies look to the future. Change, progress, and planning are integral parts of our entire way of life and crucial to our managerial processes. This book emphasizes the future, a future that will be characterized by large engineering systems matched by, and reflected in, large organizational systems. As we shall see, such systems will involve both management problems and opportunities for human expression that dwarf what we encounter in the more routinized production organizations that are the prototypes for nearly all contemporary management theory and practice.
ā” But this is not a book of speculations and forecasts, and the authors are not āfuturistsā (in part because we are painfully aware of the historical box score on prediction and prophecy). Our society already has created a number of large organizational systems to accomplish unusually challenging goals. TVA, the Manhattan Project, and NASA are among several that come easily to mind; there are many more. We intend, then, to look at actual institutions, not hypothetical ones. Our purpose is to examine the distinctive management and organizational challenges associated with large systems.1
NEW SOCIAL PROBLEMS, NEW FORMS OF ORGANIZATION
ā” An increasing number of responsible observers view the coming decade as one that will require our society to come to terms with an imposing array of problems. Rebuilding the decayed ācoresā of our cities, improving medical care, controlling pollution, increasing popular sensitivity to ecological balance, and developing more convenient and safer ground and air transportation are but a few of the objectives, staggering in terms of cost and effort, now on the horizon.
ā” There is a corresponding tendency to view the solutions to these problems in rather simplistic, primarily financial, termsāfor example, in terms of shifting resources from private (selfish) consumption to public (selfless) capital or developing greater citizen awareness of the awesomeness of these problems and the costs of further neglect.
ā” Yet, if we take the time to look at any one or all of the actual or potential new programs in these areas, we find that they share a number of characteristics which would suggest that implementation is going to involve a good deal more than willing it so by votes or dollars, or even a selfless consensus that revises national priorities (although we are not suggesting that those factors are irrelevant). First, all these objectives imply the collaboration of a relatively large number of organizations, and it would appear that these will be a mixture of public and private institutions. An obvious characteristic of modern society is ever increasing interdependency; little can be changed without affecting a wide array of institutions, and many new developments depend upon close, collaborative, and integrated activities that criss-cross organizational boundaries and the dividing line between the public and private sectors. For example, improving safety in air transportation involves the development of new avionics and air transport equipment, perhaps by government research centers working with private industry. This equipment will have to be produced by private companies, certified by the Federal Aviation Agency, accepted by commercial airlines, and fitted into the existing airport and navigation-communication systems, which are regulated by local authorities and by national and international agencies.
ā” While we shall not be at great pains to document the point, it would appear that an increasing number of purely private ventures, because of their size, their capital requirements, and their technological uncertainties, require collaborative āfederationsā as well. When the Columbia Broadcasting System recently sought to exploit a new technique for taping television programs (a technique that can be viewer controlled), it joined forces with U.S. and foreign electronics and film manufacturers as well as with other internationally based mass-media producers and distributors.
ā” If one looks at urban redevelopment, exactly the same network appears. New technology, privately or publicly sponsored, must be coordinated with the requirements of builders and developers, the massive array of government agencies, tenants, and landlords, and the financial institutions that will risk the capital. But our point is more than the multiplicity of involved organizations; it is the need for some common direction, some real federation or confederation that can act in concert.
ā” Partly because of the American penchant for organization, there is a temptation to ignore the possibility of confederation and to believe that every new social problem must be handled by a totally new social organization. To be sure, it is always easier to start afresh than to modify existing programs, but the result is a high cost in obsolete but persisting organizations and needless social complexity.2
Uncertain Technology: Uncertain Management
ā” A second element common to many large programs is uncertain technology. Whether we are talking about new construction methods, electronic devices, spacecraft, or pollution-control methods, there are numerous uncertainties that derive from inadequate knowledge of the basic technology or its specific implementation. Further, these programs are often one-of-a-kind efforts: building a science-oriented spacecraft, developing new collision-avoidance and blind-landing aircraft control devices, or what-have-you. At most there may be a very short āproduction runā; as a result, there is no opportunity to develop finely tuned routines amenable to the strictures of scientific management. Worse yet, many, if not most, of the problems have no clear-cut solutions. Largely because of the number of organizational units involved, as well as the uncertainties and risks, āthe problems and processes involved can be typified as āmessyā; solutions must be āinventedā on the spot that are not simply derived from scientific and engineering principles.ā3
ā” Traditionally, ours is an optimistic culture. Although faith in our omnipotence has been shaken by profound social unrest, American technological pragmatism is unchallenged. Confidence in the expertness with which we can move from research through development to implementation, even when the organizational and engineering obstacles are staggering, has resulted in a growing demand that this engineering-management āknow howā be redirected toward solving the growing problem of American urban life.
ā” Such understandable enthusiasm and confidence, both in the transferability of technology and in our ability to solve any problem āwe put our minds and backs to,ā need some tempering. First, there is an impressive and growing list of failures in large-scale advanced-technology programs. Witness the observation of Senator Proxmire, who, after reviewing Budget Bureau data, concluded:
ā¦In the procurement of some 2 dozen major weapons systems costing tens of billions of dollars during the nineteen-fifties and sixties, the performance standards of the electronic systems of these weapons seldom meet the specifications established for themā¦. Of 11 major weapons systems begun during the nineteen-sixties, only two electronic components performed up to expected standardā¦. A majority performed at a level of 25 per cent or less than the standards and specifications set for them.4
ā” Many of these failures involved military programs for new planes, tanks, helicopters, missiles, rifles, and the like; but there has also been an impressive number of failures in nonmilitary projects in recent yearsāfor example, in perfecting high-speed trains, in the fabrication of high-pressure nuclear vessels, in the manufacture of āheavy water,ā and in advanced electronics and construction projects.
ā” A second point, perhaps closely related to the first, is that we probably know less than we think we do about the management process by which new technology is converted into operating systems. It is all too easy to assume that American know-how plus large doses of impersonal rationality will almost mechanically produce results. Thus there is cynicism concerning the recent triumphs in space. A national news magazine argued,
The [Apollo] moonshot, in short, was a triumph of reason and technology, and it came at a time when large numbers of young people had turned in rebellion against both. Technology seemed too methodical, reason too stultifying of human spontaneityā¦5
ā” This statement is ironic indeed. It implies that (1) we know very well how to manage such large programs, (2) it is not very difficult anyhow, and (3) engineering and science bear little relevance to the social and political spheres of our society. We are suggesting, of course, that all three implications are wrong.
The Trend Toward Bigness and āFederalā Organizations
ā” The trend toward bigness is not, as some would believe, simply an extension of manās greed and folly or historyās inexorable repetition of the dinosaur syndrome. It is related to the older trends of economies of scale (bigger chemical plants are more efficient than smaller ones) and growth of world markets. But size is also a product of some relatively new trends, like those outlined above. Newer technologies may require the collaboration of many organizations because of the enormity of the problems that must be solved. The development of nuclear energy, viable commercial communication satellites, and space flight are all beyond the capacities of any single industrial organization or government bureau.
ā” Our traditional predisposition to fear goliaths is easily aroused, but there are indications that the organizations of the future will be structured quite differently from the stereotype corporation of today. For many the idealized frontier and agrarian spirit are suffocated by a rigid hierarchy, in which commands flow down and reports up while the individual is confined in a narrow vertical channel. The large organizations of the future cannot be constructed in such a fashion; there will be too many diverse and far-flung subunits that owe only modest loyalty to the core. NASA, the European atomic energy ācommunity,ā and COMSAT (the consortium that constructs and operates international communication satellites) already demonstrate a new federalism in which the parts have some independence and are perhaps more demanding. The core of such endeavors is made up of the one or several sponsors or clients, closely surrounded by their major contractors, followed at a somewhat greater distance by subcontractors and still farther by advisors, actual or potential beneficiaries, auditors, licensors or controllers, and many others.
ā” A major paradox suggested by the NASA data is that effectiveness in development programs requires a high order of responsible autonomy and the opportunity to innovate and even to change plans. But large-scale projects with the demanding quality and performance requirements of a space program also require unbelievably precise integration and coordination among the parts. While these āpartsā (experiments, launch vehicles, spacecraft and their subsystems) are designed and fabricated in a number of separately organized and directed institutions, with perhaps incompatible objectives, they must intermesh perfectly. Thus a wide array of intellectual and economic commitments must be simultaneously focused on a very explicit task without destroying the motivations that release energy and commitment.
ā” One result of this paradox is the role of personal contact in a highly technical milieuāthe amount of human interaction and exchange required and the extent to which impersonal methods of communication fail to substitute for direct confrontation.
ā” Our system of government almost guarantees organizational complexity because of the overlapping jurisdictions of local (community, county, precinct, school-district, ward) state, and federal agencies. Introduce a new medical program, engage in urban redevelopment or massive flood-control and water-power (TVA) programs and one comes to grips with not only these āpublicsā but the countless private and semiprivate organizations that have, or seek, the right to be heard. The New York Times noted, for example, that ā300 different local, state, Federal and private groupsā¦try to deal with social problems in the Milwaukee area.ā6 NASA, at its peak in the mid-1960s, sought contributions from 20,000 different organizations!
ā” While there may be a number of permanent operations in such projects, much of the work is temporary. People get shifted around and plans get changed in an environment quite different from the tiresome monotony bemoaned by so many in traditional institutions. Projects, task forces, and temporary āteamsā also mean that individuals have multiple organizational āhomes.ā A scientist may be part of a university, responsible for the design and testing of an experiment to be flown by a NASA spacecraft, serving as a consultant to an industrial contractor that builds equipment for the agency, and a member of an advisory board that helps shape future science policy for NASA and other government agencies.
Management in āFederalā Organizations
ā” And then there is the matter of authority, the control of one individual by another, the power to reward and punish. As we have already noted, āfederalā organizations are populated by highly trained, self-sufficient, and reasonably con tentious professionals and technicians who demand the right to be heard. Many of the critical contributions must be made by outsiders. Individual managers must learn the subtle skills involved in control at a distance, in penetrating outside organizations to assess what is happening and in influencing them so as to gain timely responsiveness. These āfederalā organizations train their administrators to shift back and forth from structural constraintsāassuring conformity without administrative interventionāto direct leadership. Short-run improvisations overlay long-run strategies. In fact, improvisation and spontaneity, the presumed absence of which in modern technology is so decried, turn out to be critical managerial skills.
ā” Even planning is a rather different function in these large developmental systems where uncertainties predominate. Traditionally, managers are taught to identify their ultimate ends and purposes, set objectives that will help attain these ends, and then develop operational plans. Unfortunately, this comforting and logical sequence gets upset in the real world of large systems. Clear objectives often disguise conflicting purposes reflecting the divergencies among the temporarily allied groups in the federation. Existing operational techniques often seek objectives that they can implement, rather than the other way around. Planning turns out to be a dynamic, iterative process. This inevitably disperses authority, since a small gr...