The Politics of Organizational Decision-Making

Andrew M. Pettigrew

• Publisher: Routledge
• Year: 2014
• ISBN:
  9781317833895
• Edition: 1
• Topic: Medicine
• Subtopic: Health Care Delivery

Tavistock Press was established as a co-operative venture between the Tavistock Institute and Routledge & Kegan Paul (RKP) in the 1950s to produce a series of major contributions across the social sciences.
This volume is part of a 2001 reissue of a selection of those important works which have since gone out of print, or are difficult to locate. Published by Routledge, 112 volumes in total are being brought together under the name The International Behavioural and Social Sciences Library: Classics from the Tavistock Press.
Reproduced here in facsimile, this volume was originally published in 1973 and is available individually. The collection is also available in a number of themed mini-sets of between 5 and 13 volumes, or as a complete collection.

CHAPTER 1

Conceptual Orientations

Harold Wilensky (1967) comments in the preface to his book: ‘Despite centuries of concern with policy, we have little solid understanding of the relation of experts and intellectuals to men of power.’ The same might also be said of relations between experts in different disciplines. This study attempts to deal at an exploratory level with both. In the language of organization theory, we are concerned here with the vertical and with what Landsberger (1961) calls the horizontal dimension in a bureaucracy.

The analytical approach is based upon a longitudinal research design. The interest is in social process, the behaviour of men over time. Conceptually the study cuts across several domains. In this context, the analysis of social process, the field of social anthropology has offered considerable help. Anthropologists, however, have not always been interested in time and social structure. In 1952 Radcliffe-Brown was arguing for a synchronic description of social life. The aim was ‘to give an account of a form of social life as it exists at a certain time, abstracting as far as possible from changes that may be taking place in its features’ (1952: 4). M. G. Smith (1962: 77) has pointed out that ‘under these circumstances many social anthropologists have undertaken to study social systems as if they were closed and changeless. They begin by excluding historical interests from their field of enquiry. They next exclude all changes that may be currently under way in the units they investigate.’ Smith describes such a theoretical scheme as ‘the fallacy of the ethnographic present’ (1962: 77). He recommends that the appropriate field of anthropological study should be a ‘unit over time, not merely a unit at a particular point in time’ (p. 81). In this way, structural regularities may be abstracted from the succession of relatively unique events ‘to reveal the outlines of an order within processes of simultaneous continuity and change’ (p. 84). Turner (1957) uses the mechanism of the social drama to delve into social process. The drama performs a dual function. First, it sheds light: ‘The social drama is a limited area of transparency on the otherwise opaque surface of regular, uneventful social life’ (1957: 93). A sequence of such dramas may also be used to observe the crucial principles of the social structure in their operation, and their relative dominance at successive points in time.

Van Velsen (1967) advocates the use of the extended case method and situational analysis. Unlike Smith and Turner, he tries in addition to break down the firm hold that normative functionalism has had on structural–functional analysis. He argues that there will always be a certain amount of choice, in the sense of selection by the individual of alternative norms of behaviour within a persisting social structure: ‘Situational analysis will be useful for the study of social process including the study of regularities in the variety of actual individual behaviour within the social structure’ (1967: 142). Like Smith, Van Velsen is careful to point out that such an approach is aimed at illuminating certain regularities of social process, not at highlighting personal idiosyncrasies.

The use of historical material in the study of organizations is rare. Lipset, Trow, and Coleman (1956) in their study of Union Democracy show what can be done with historical data. To answer their original question why there is democracy in the International Typographical Union, they say this ‘can be found only by combining the structural and historical analyses’ (1956: 441): ‘The historical analysis explains how the system, in this case two-party democracy, came into existence, while the sociological analysis accounts for the ways in which structural factors … operate to maintain it’ (p. 451). It is at this point that the theoretical approach set out here differs from that of Lipset, Trow, and Coleman. The concern here is not with system maintenance but with the analysis of processes located in changing structures of social relationships, norms, values, and ideas over time.

Jobling (1969) also makes a plea for the use of historical material in the study of organizations. Talking of university development in the UK, he maintains that ‘historical data provide first insight into problems and intimations of fruitful hypotheses as well as being sociologically valuable in their own right’ (1969: 11). Mouzelis (1967) notes that ‘present organization theory is not only predominantly ethnocentric but ahistorical as well. The organizations studied seem to exist in a timeless dimension’ (1967: 165).

It would seem futile, however, to argue for a methodological strategy that included the collection of historical data and the observation of social processes if the theoretical assumptions that were being made about homo sociologicus restricted the analysis of change. Merton (1957a) is clear on this point when he discusses the bearing of empirical research on sociological theory. Van Velsen (1967: 145) notes that ‘it is one of the assumptions of situational analysis that the norms of society do not constitute a consistent and coherent whole. They are vague and discrepant. It is this fact which allows for their manipulation by members of a society in furthering their own aims.’ Blumer (1953: 199) holds that ‘the human being is not swept along as a neutral and indifferent unit by the operation of a system. As an organism capable of self-interaction he forges his actions out of a process of definition involving choice, appraisal and decision…. Cultural, status positions and role relationships are only frameworks inside of which that process of formative transaction goes on.’ Gross, Mason, and McEachern (1958) dismiss the postulate of consensus on role definition and provide evidence from the school superintendent role of the great deal of choice behaviour possible within a role. Goode (1960a) sees institutional process as a resolution of role strain. Faced with the felt difficulty of fulfilling role demands, individuals attempt to make bargains with the other members of their role set about their respective rights, privileges, and obligations. Strauss et al. (1963) argue in favour of a negotiated order. A hospital can be seen like any other organization as a hierarchy of status, power, rules, roles, and organizational goals. It may also be considered as an ordered environment ‘which has to be worked at and continually reconstituted’ (Buckley, 1967: 149). Such a negotiation process was found to have patterned and temporal features. Agreements were ordered in terms of ‘who contracts with whom, about what, as well as when’ (Strauss et al., 1963: 162).

The recognition of choice and variability in social interaction leaves the way open for a strategic conception of behaviour in organizations. Exchange theory offers some conceptual assistance here. The major theoretical antecedents of Blau's (1964) version of exchange theory are the rational choice models of economics and game theory. The major assumption is that individuals make choices which accord best with their self-interest. Blau is quick to point out, however, that not all individuals act in their own interests (1964: 5). Not all human behaviour is dominated by individuals' pursuit of social rewards in their associations. He also acknowledges Luce and Raiffa's (1957) and Schelling's (1960) criticisms of game theory and modifies his rational choice model in two ways. Individuals' choices are limited, first, by their perception of the situation in which they act and, second, by the amount of information they have at hand (Blau, 1964: 18–19). I would also add a third, very important, restriction on rationality: the constraints of access imposed by man's location in a social structure. Nevertheless, Blau's heuristic approach ‘that men seek to adjust social conditions to achieve their ends’ (1964: 19) is one of the major theoretical assumptions of this work.

As Kapferer (1969b) notes, individuals' actions may be directed in their self-interest but often their actions so directed have an effect contrary to their interests. Consideration of the way in which they perceive the situation of their action and of the extent to which they have sufficient and accurate information as to how their interests can best be achieved is essential to any analysis of social behaviour. In their attempts to operate various strategies, individuals continually commit errors because of misperception through lack of information or miscalculation. They can also be manoeuvred into committing errors. Finally, individual action may lead to unintended consequences. Somebody obviously striving for power will encourage others to consider their own interests more carefully and perhaps enable them to generate sufficient resources to maintain those interests in the face of the new threat.

In the analysis so far, then, man is presented not merely as being governed by the structure of the situation in which he participates but also as attempting, at least to some extent, to shape and mould that structure over time to suit his own interests. As a later discussion will attempt to show, an individual's ability to achieve this moulding is very much a function of his ability to generate sufficient power and influence to impose his will on others in the face of opposition.

The neglect of the analysis of social processes in organizations has already been stressed. It is difficult, however, to analyse social process unless the situation of one's sociological analysis is treated as part of a process in the first place. The two major substantive processes dealt with here are decision-making and specialization. Decision-making is considered first.

THEORIES OF ORGANIZATIONAL DECISION-MAKING

The literature in the field of decision-making is immense. In 1959 Gore and Silander talked about a generous list running to five thousand entries. By 1964 Wasserman and Silander had produced a 178-page bibliography. Gore and Silander were not impressed by any unity of purpose: ‘In short, the literature dealing with decisionmaking, impressive in relation to one man's ability to deal with it, appears to be uneven and chaotic, and in no respect comprehensive’ (1959: 121). They note that such ‘critical factors as a typology of decision, models of various decisional processes, the function of ideology and the basis of power and its generation receive only infrequent and inadequate attention’ (p. 121).

The oft-made statement that decision-making is the organizational activity (Barnard, 1938; Simon, 1957) has encouraged scholars from many disciplines to its study. Work from psychology is usefully summarized by Collins and Guetzkow (1964) and Edwards and Tversky (1967); from public administration, by Mailick and Van Ness (1962), with notable other contributions by Gore (1956), Lindblom (1959), Braybrooke and Lindblom (1963), and Chapman (1968). Snyder and Paige (1958), Dahl (1961), Polsby (1963), and Hawley and Wirt (1968) have worked in the areas of community decision-making and foreign policy decisionmaking using a political science approach; while, notably, March and Simon (1958), Cyert and March (1963), and Gore and Dyson (1964) have attempted to use an interdisciplinary framework. Further well-established and expanding fields are the mathematical–economic approaches of Cooper et al. (1958) and Wagner (1969), and the game theoretical work of Von Neumann and Morganstern (1944), Shubik (1959), Siegel and Fouraker (1960), and Cross (1969).

One of the most general statements that can be made about the theories of organizational decision-making is that they fall into two broad classes. There are the normative mathematical–economic theories and the so-called behavioural theories. It is the second of these two approaches that informs the present study. The interest here is in tracing decisions empirically to find out what actually happens rather than what is ideally expected to happen. In this connection, the work of March and Simon (1958) and Cyert and March (1963) offers the most material assistance.

March and Simon

As Burns (1965) points out, the Carnegie group attempt to put forward a general theory that will make sense of a wide range of empirical experience of business concerns obtained through research and consultancy. Their model, ‘derived from the conventions of the computer simulation of business decision-making’, is an attempt ‘to elaborate a rational model of the business concern’ (1965: 168).

In spite of its interdisciplinary aims, the main point of March and Simon's book Organizations is that the interrelation of motivation and cognition must be of central concern for organization theory (1958: 135). The book has a consistently strong psychological bias. As Udy (1959: 222) observes: ‘Half the book is devoted to motivation and much of the remainder to personal decision-making. Furthermore, the impression is given that all problems of administration are reducible either to the rational allocation of values or individual psychology. Relatively little attention is given to the social organization of administration.’

March and Simon's thorough critique of the instrumental man put forward in the writings of Taylor, Gulick, and Urwick sets the tone of their book. These authors are criticized for their incomplete and inaccurate motivational assumptions, for ignoring human limitations on information-processing, and for giving little attention to the role of cognition in task identification (1958:33). In turn, the theories of Merton, Selznick, and Gouldner are deemed incomplete because they do not systematically explore the different modes of influence over individual motivation in organizational behaviour. These must be examined in terms of two critical individual decisions, the decision to participate and the decision to produce.

March and Simon summarize their position thus (p. 11): ‘This, then, is the general picture of the human organism that we will use to analyse organizational behavior. It is a picture of a choosing, decision-making, problem-solving, organism that can do only one or a few things at a time, and that can attend to only a small part of the information recorded in its memory and presented by the environment.’ There is here too much emphasis on reconstructing the organization from the perspective of the individual, and not enough on demonstrating how the organizational structure impinges on the individual's perspective. March and Simon show too much concern with the individual as an information-processing system and not enough with the organization in these terms. It is this basic weakness in their approach that leads me to suggest that their conception of organizational decision-making is but a partial theory.

The central theme of their chapter on decision-making is ‘that the basic features of organization structure and function derive from the characteristics of human problem-solving processes and rational human choice’ (p. 169). Their two main points are that people seek to satisfice and not maximize in making decisions and that there are various cognitive limits on rational behaviour. They suggest that the highly specified and clearly defined environment in which the rational man of economics and statistical decision theory makes ‘optimal’ choices is highly unrealistic. Decisionmakers do not have all the alternatives laid out before them from which to choose, nor all the consequences of these alternatives. It is not just a matter of setting a utility function and selecting the alternative leading to the preferred set of consequences (p. 137).

Instead, ‘Choice is always exercised with respect ot a limited, approximate, simplified model of the real situation’ (p. 139). The alternatives generated and the way they are evaluated are a function of the decision-maker's definition of the situation. This, in turn, is influenced by selective perception and sub-goal identification.

A critical and novel part of March and Simon's theory is the existence of search behaviour. They argue that information is not given to the firm but must be obtained, that alternatives are searched for and discovered sequentially, and that the order in which the environment is searched determines to a substantial extent the decisions that will be made. This is tied up, as are other areas of their theory of choice, with their ideas on organizational conflict. To March and Simon, conflict is necessarily dysfunctional for rational problem-solving. Conflict is defined as ‘a breakdown in the standard mechanisms of decision-making so that an individual or group experiences difficulty in selecting an action alternative’ (p. 112. From the perspective of the individual, as well as from that of the organization, ‘where conflict is perceived, motivation to reduce conflict is generated’ (p. 115). ‘As in the case of the individual, we assume that internal conflict is not a stable condition for an organization and that effort is consciously directed toward resolving both individual and intergroup conflict’ (p. 129). Such statements lead Krupp (1961: 165) to accuse March and Simon of being interested fundamentally in ‘harmony and continuity’. The authors' three sources of conflict, unacceptability, incomparability, and uncertainty (p. 113), all pinpoint the inability to reach agreement on a preferred alternative and set in motion the search for a ‘satisfactory’ alternative. Unfortunately, it is never made clear in an operational sense what satisfaction means. For a similar critical view of March and Simon's ‘satisficing man’, see Shubik (1961) and Loasby (1968).

Given an organizationally relevant state of interdependence, March and Simon hold that ‘a felt need for joint decision-making’ will arise. For conflict to occur, however, one or both of two additional conditions must also be present: first, a difference in goals, and, second, a difference in knowledge and perceptions, between groups in an interdependent relationship. What they fail to recognize is that conflict may arise because of a felt need, not for joint decision-making, but for transference of authority over a particular area from one sub-unit to another. Dimock (1952), Scheff (1961), and Strauss (1962, 1964) provide empirical examples of such a process. Unfortunately, to March and Simon, interdependence is always given, never problematic. It is this inability to accommodate structural sources of conflict in their decision theory that leads both Krupp (1961) and Ephron (1961) to suggest that March and Simon's theory of conflict is incomplete. Certainly the key place they attach to cognitive and value predispositions in the creation of conflict tends to ignore the theoretical possibility that such factors may only be reinforcing differences of opinion and interest that have been generated by organizational relationships.

Their tendency to neglect structural sources of instability in organizational decision-making is tied to their neglect of another major variable. As Rex (1961: 112) has noted: ‘If there is a conflict of ends the behaviour of actors towards one another may not be determined by shared norms but by the success each has in compelling the other to act in accordance with his interests. Power then becomes a crucial variable in the study of social systems.’ The consideration of power leads the argument away from woolly notions of satisficing towards the possibility of explaining choice among alternatives as a product of the strategic mobilization of power resources. The issue of power in a theory of organizational decision-mak...

Table of contents

• Cover
• Half Title
• The International Behavioural and Social Sciences Library
• Title Page
• Copyright Page
• Original Title
• Original Copyright
• Dedication
• Table of Contents
• Figures and Tables
• Acknowledgements
• Preface
• 1 Conceptual Orientations
• 2 Decision-making as a Political Process
• 3 The Setting: Overview of Events 1955–68
• 4 The Research Process
• 5 Specialization as an Emergent Process: Phase One
• 6 Specialization as an Emergent Process: Phase Two
• 7 Strategies of Power Acquisition and Maintenance 1957–66
• 8 The Disparity of Demands in an Innovative Decision Process
• 9 The Sources and Use of Power in an Innovative Decision Process
• 10 Conclusion
• References
• Author Index
• Subject Index