“Abstract of Presentation by Eric Gaynor Butterfield, November 1999 - Organizational Development Conference carried out by The Organization Developmen
The following main authors have been summarized.
- Chandler, Alfred D.
Alfred Chandler ("Strategy and Structure"; MIT - 1962 / "The visible hand: the managerial revolution in American business"; Harvard - 1977 / with R. Tedlow: "The coming of managerial capitalism"; Irwin - 1985) has been a professor in Business History at Harvard University, and, according to him, it is a fairly ignored area within history in general. He has carried out numerous field and research works, a large number of them being carried out for the Alfred P. Sloan Foundation. His book entitled "The Visible Hand" won the Pulitzer Prize for History.
Like few people, he studied the origin of large corporations during the period known as modern capitalism, which covers from the 1850s to the year 1920, at which time a new institution was created: the multi-unit company. This type of company was controlled by a new generation of managers who operated under a new capitalist system.
It is interesting to note that in Latin America universities and the world of Frederick Taylor's company (“The Scientific Administration” - 1917) are spoken of as the initiator of a movement that lays the first foundations of administration.
Our backwardness in this matter is so great that it has not been realized that the Industrial Revolution of the 1850s in the United States of America was accompanied at the same time by an Organizational Revolution that allowed the development of a new institution: the multi-company unit that allowed, as a new organizational arrangement, its unlimited growth. Instead, even today, we see how in different Latin American countries companies die when the founding partner dies and their descendants are unable to continue the business.
What Chandler's work points out is that the managers of the Industrial Revolution in the United States had to develop different strategies from the ones that their predecessors used to use and put into practice in the managerial area, and in turn these strategies were not only They had to be at the head of these new managers, but they had to be able to put these strategies into practice, putting fully innovative organizational structures into effect. And it was these new organizational structures that made it possible to effectively integrate mass production with mass distribution.To some extent these new strategies and organizational structures within the USA were the models to be used to go beyond its borders several decades later when large multinational corporations spread and, we can also point out that the multi-unit company within the The United States of America turns out to be the ancestor of the franchised company worldwide. In short, the much-touted Industrial Revolution had the success attributed to it, because it was accompanied by an Organizational Revolution integrating the social component with technology.This is a lesson that we have not yet learned in Latin America and there are a multitude of examples such as the case of implementing new software when it is assumed that there is a natural accommodation to the new methodological tool and the infinite number of variables is not taken into account. that can fail its implementation.
Alfred Chandler performs an excellent historical analysis, pointing out aspects of importance in relation to organizational change and of this in the relationship between strategy and structure. The Organization Development Institute led by Dr. Donald Cole was a pioneer in the world to highlight the importance of Organizational Change and Development, with the multitude of variables that impact it, and hers on those and even other variables. What is totally clear from Chandler's work is that structure is a consequence of strategy, so first one adopts a strategy and then chooses an organizational arrangement. And it distinguishes both concepts in the following way.Strategy is the establishment of long-term objectives and goals accompanied by the adoption of different alternative courses of action related to the allocation of resources to achieve these objectives. While structure is rather the organization that is designed to manage the activities that arise from the different strategies adopted, for which it implies the existence of an order of hierarchy, certain distribution and allocation of work, lines of authority and communication, and data and information that flow through the different lines.for which it implies the existence of an order of hierarchy, certain distribution and assignment of work, lines of authority and communication, and data and information that flow through the different lines.for which it implies the existence of an order of hierarchy, certain distribution and assignment of work, lines of authority and communication, and data and information that flow through the different lines.
Chandler's extraordinary merit lies in having identified the importance of the social with the technical, something that the Tavistock Institute had at the heart of his work. And Chandler masterfully unites the different units of analysis assigning substantial importance to the development of new organizational arrangements that allow the unlimited growth of companies. In Latin America we treat the problem of evolving from the figure of owner present in the small company to the modern corporation and going through the multi-unit company, as a “family” type problem. It requires going much further than exploring the situation as a family problem; The managerial skills necessary to operate in large companies require the development of a series of knowledge, skills,skills and competencies that are totally unfamiliar to the organizational participants of the company guided by the founding partner. And what makes this transition even more difficult is the fact that the large Centers of Higher Studies and the most prestigious Universities are also not in a position to develop this set of knowledge, skills, abilities and competences equally for all. It should not be forgotten that Harvard University emerged in the 1920s as a reaction to a request from the same companies that did not find in university graduates the necessary requirements to effectively manage within the business world. The famous Harvard case method only begins to have application in Latin America some 70 years later… an existence for a world that was already competitive.
The USA was able to make the industrial revolution grow in parallel with the organizational revolution by appearing a new class of managers, who being a salaried employee - well paid - is committed to the long-term stability of their company. And you start to think in terms of career for these salaried managers who increasingly earn more in professionalism and technical skills.
Alfred Chandler makes it very clear that without the role of managers the structure could collapse, and he makes it very clear when he states "that the visible hand of managers replaces the invisible hand of the market of Adam Smith (" An inquiry into the nature and causes of the wealth of nations ”; N. York - 1776). The managers are at the same time the product and developers of multi-divisional decentralized structures, being responsible for the administration of the company fulfilling the functions of coordination, planning, control and allocation of resources. It seems to infer Chandler's work that this important managerial role allows "financial" men to dedicate themselves to business, and to leave companies in the hands of administrators.And this partition between business and companies has been very clear in the USA for more than a century and a half, while in Latin America we have not yet realized this distinction. (Even the Bachelor of Business Administration Diploma bears no relation to what you "believe" is your partner in the USA, the Master of Business Administration. Indeed, the correct translation is Master of Business Administration, which is very different from a Master In business administration). The implications of this vision, perception and sensation come to the actions, at some point.That is why in Latin American communities we have difficulties operating virtually (something that business people can do more easily), unlike the concept of a company that is visualized as an entity made of bricks and cement where many people - real - they work within it a significant number of hours for a significant number of days for much of the year.
These multi-unit companies to which Chandler refers and which originate from the industrial revolution around 1850, require in addition to the strategy a consequent structure that allows an efficiency in the day-to-day operations of its different units together with long-term organizational health. This type of structure combines decentralized day-to-day actions in both manufacturing and services, and the development of a central office with different functional departments that handle long-term operations. One of the immediate actions taken by this type of multi-unit company is related to removing executives from day-to-day positions and transferring them to new departments that had to do with long-term planning and control.What seems so simple - when it is finished - was of vital importance in the development of the multi-unit company, assigning a special role to the tasks of business creation and innovation. The implications of these structural arrangements are multiple; Creatives and innovators have free time and information that allows them to commit to long-term actions that at the same time enable the sustained growth of the organization.Creatives and innovators have free time and information that allows them to commit to long-term actions that at the same time enable the sustained growth of the organization.Creatives and innovators have free time and information that allows them to commit to long-term actions that at the same time enable the sustained growth of the organization.
This transition from a proprietary company to a multi-unit company allows transferring a family-type capitalist economy to managerial capitalism. And this transfer according to Chandler originates as a consequence of external pressures such as the urban markets of the last decades in the 19th century. Added to this is the technological change that has enabled high levels of mass production. In turn, as a result of external pressures, companies can adopt two strategic positions: a positive strategy when it attacks new markets and develops new products, which is done through a diversification process, or a defensive strategy protecting its current position by through vertical integrations as a result of mergers with similar companies, suppliers and Clients.Both strategies ultimately lead to larger companies, which in turn cause various administrative problems that require a series of systematized techniques to manage the different functional activities. Chandler suggests that an initial way to do this is through a functionally centralized, departmental structure that makes it possible to successfully combine expert skills and in turn allow owners to retain control.Chandler suggests that an initial way to do this is through a functionally centralized, departmental structure that makes it possible to successfully combine expert skills and in turn allow owners to retain control.Chandler suggests that an initial way to do this is through a functionally centralized, departmental structure that makes it possible to successfully combine expert skills and in turn allow owners to retain control.
But as the organization grows in size, the resources that are made available to the company in terms of people, money and materials must also be expanded, which translates into continuous and sustained growth. And the important thing is that this growth emanates at the moment as a consequence of the interests of the managers and not of the owners. Managers have an interest in the company earning more. They are interested in the capital gain of the same company with respect to them being even greater than it was (Schumpeterian vision). There are managers "delighted" that their contributions are actually greater than their retirements, or in terms of James March and Herbert Simon ("Organizations"; Wiley and Sons - 1958),They are happy that managers' “contributions” exceed the “incentives” offered by the owners. Therefore, growth is the result of both external and internal forces, which in turn produces new innovative structures where the development of decentralized multi-units is present. In short, it was good to be exploited - in the positive sense - as this enabled organizational growth and also the growth of the company's management and executive body. Something unprecedented until then in the history of business (it is unfortunate that in Latin America we have not yet learned this simple lesson).growth is the result of both external and internal forces, which in turn produces new innovative structures where the development of decentralized multi-units is present. In short, it was good to be exploited - in the positive sense - as this enabled organizational growth and also the growth of the company's management and executive body. Something unprecedented until then in the history of business (it is unfortunate that in Latin America we have not yet learned this simple lesson).growth is the result of both external and internal forces, which in turn produces new innovative structures where the development of decentralized multi-units is present. In short, it was good to be exploited - in the positive sense - as this enabled organizational growth and also the growth of the company's management and executive body. Something unprecedented until then in the history of business (it is unfortunate that in Latin America we have not yet learned this simple lesson).Something unprecedented until then in the history of business (it is unfortunate that in Latin America we have not yet learned this simple lesson).Something unprecedented until then in the history of business (it is unfortunate that in Latin America we have not yet learned this simple lesson).
Alfred Chandler shows evidence of his findings, mentioning the innovative structure processes adopted by four large companies:
- DuPontGeneral MotorsStandard Oil of New Jersey, andSears Roebuck
Based on various field work and studies by Chandler, Chandler suggests making distinctions between an "adaptive response" and a "creative innovation." In the first one, it is a structural change that remains within the range of current customs and practices, which may well be carried out with functional departments and a central office.
Under “creative innovation” it goes beyond current practices and procedures, and different decentralized units are developed. The departmental line-and-staff structure in the different units allow combining and making possible an effective delegation of authority with the corresponding responsibility, something that seems very simple in words but not easy to achieve in day-to-day practice in the world. organizational.
Chandler finally notes that little attention has been paid to the history of business administration despite the enormous influence it has had on economic development. He suggests that as a new economic function in societies, one of administrative control and coordination should be taken into account, and in turn, to develop it, it is necessary to create a new species, the salaried manager.
- Gouldner, Alvin W.
Alvin Gouldner was born in 1920 and died in 1980. He held academic assignments at Washington University, Saint Louis. He was very interested in the role of knowledge within society and also within organizations, being a curious researcher on social problems reporting to the American Jewish Committee in addition to having worked as a consultant for the company Standard Oil of New Jersey.
We could say that Gouldner's life ("The coming crisis of western sociology"; N. York - 1970 / "Patterns of Industrial bureaucracy"; Glencoe - 1954) begins as a result of the very existence of Max Weber. Just as Weber ("The theory of social and economic organization"; Oxford - 1947) develops the basic hypothesis that organizational participants where they comply with rules, norms and procedures and at the same time obey orders, Gouldner strives to apply the concepts of bureaucracy but encounters difficulties in its operation. Weber wonders: On what basis do those who enact the rules and give the orders actually obtain and legitimize their authority? And in response to this question Weber has paid no attention to the phenomenon of "opposition" and neither to that of denying consent on the part of the subordinate.Gouldner suggests that in the transfer from a traditional or charismatic system to an organizational arrangement of a bureaucratic type, it is very common to find - among other things - opposition from subordinates even from those superiors who are "experts".
En un estudio muy detallado realizado en una empresa minera en los Estados Unidos, Gouldner identifica algunas de las consecuencias disfuncionales de querer implantar una organización burocrática. La forma en que operaba la mina era de tipo “permisivo”, existiendo pocas normas y reglas, el personal no estaba sujeto a supervisión cercana, y en el caso de errores siempre existía una segunda oportunidad. Se operaba bajo una atmósfera de relax donde la actitud de los trabadores hacia la empresa era positiva. Dentro de este esquema hizo su ingreso un nuevo gerente que trató de implementar medidas características de organizaciones burocráticas basadas en reglas y normas, lo que desencadenó una serie de consecuencias disfuncionales que aumentaron el conflicto y las diferencias entre el personal y la empresa, que se precipitó en una huelga general.
These and other observations by Alvin Gouldner were taken into account in Herbert Simon and James March's monumental work Organizations (1958). The dysfunctional consequences that Gouldner identifies do not facilitate the process for Max Weber's bureaucratic organization to reach high efficiency levels, as the latter postulates. According to Alvin Gouldner, these negative consequences for the company as a result of the transition towards bureaucratic organization give rise to various pathologies that he calls various types of bureaucracy. They are: 1. the buffoon bureaucracy; 2. the representative bureaucracy, and 3. the punishment-focused bureaucracy. These three types of bureaucracy do not necessarily take shape in different organizational arrangements;It is quite possible that a combination of two or more of these three types of bureaucracy co-exist in the same organization.
The buffoon bureaucracy is one where the rules are imposed from outside the company and both subordinates and superiors do not consider them legitimate. The status of organizational participants is not obtained as a consequence of complying with these norms… but rather for violating them. For example, insurance companies are not responsible for claims caused by smoking in prohibited places and the status of incumbents is achieved by smoking in these prohibited places. Something similar occurs within educational institutions when the teacher temporarily expels a student to the schoolyard for not paying attention in class… which gives this student a special status compared to the rest of his classmates. Returns awarded by groups outside the company have a similar effect.It is noteworthy that in this type of organization the organizational climate is often much higher than usual and both the satisfaction and the morale of the participants may be satisfactory. It is even very common that in this type of company, organizational participants have a high propensity to stay within the company, showing satisfaction with the entity.
In the punishment-focused bureaucracy, both the rules and the rules and procedures are a response to pressures that can come from management or workers. The attempt seeks to compel the other party to change their behaviors. As for example we can mention the clocks that are installed to verify the time of entry and exit of the staff. In this type of bureaucracy, management tries to achieve compliance through rules and regulations, but it must be borne in mind that there is a very large distance between the desired results and the results achieved, since there may be actions that repel original attempts; solidarity between subordinates through high degrees of cohesion can even impose norms on the same management.The problem with this system is that usually only one of the parties considers the norms and rules legitimate, and may be superiors or subordinates. The problem with this bureaucratic system focused on punishments is that noncompliance with orders is considered disobedience, which increases tension and conflict between superiors and subordinates.
Under the representative bureaucracy the norms and rules are promulgated by experts whose authority is generally accepted by all organizational participants. Under this situation, organizational compliance with some type of conflict is obtained, but little manifest conflict. Under this type of bureaucracy there is a reasonable compatibility between the values of the organization and those of the personnel. In some way we can say that Gouldner here coincides with two other great authors of organizational theories and practices such as Frederick Taylor and Henri Fayol "" Industrial and general administration "; London - 1930) who suggest that authority is based on technical knowledge and expertise rather than position.
The implications of Gouldner should be taken into account very especially by entrepreneurs and entrepreneurs in Latin America, since a mechanistic type model seems to be among the most widely used and put into effect. It is to be noted that norms can have both positive and negative effects, resulting in anticipated and unanticipated consequences. In reality, when organizations strive to put into effect a bureaucratic model based on norms, rules and procedures, one of the main reasons for this seeks to overcome the problems resulting from very close supervision or when the scope of control is too great.. So rules can help replace the superior's verbal language by creating obligations to be fulfilled by the subordinate;however, it must also be borne in mind that the informal group may very well be stronger than the norms and in many circumstances they can establish standards that go against the regulations. Another of the dysfunctional consequences of the regulations has to do with the fact that they have the advantage of “giving orders at a distance”, but here also remote orders can give rise to a buffoonery bureaucracy where the participants consider the authority of superiors absurd. Rules and regulations have other drawbacks; they generally establish average productivity levels discouraging the highly productive.Another of the dysfunctional consequences of the regulations has to do with the fact that they have the advantage of “giving orders at a distance”, but here also remote orders can give rise to a buffoonery bureaucracy where the participants consider the authority of superiors absurd. Rules and regulations have other drawbacks; they generally establish average productivity levels discouraging the highly productive.Another of the dysfunctional consequences of the regulations has to do with the fact that they have the advantage of “giving orders at a distance”, but here also remote orders can give rise to a buffoonery bureaucracy where the participants consider the authority of superiors absurd. Rules and regulations have other drawbacks; they generally establish average productivity levels discouraging the highly productive.they generally establish average productivity levels discouraging the highly productive.they generally establish average productivity levels discouraging the highly productive.
There is an additional criticism that Gouldner makes and that is followed by other important business and organization scholars such as Víctor Thompson (“Modern organization”; Knopf - 1967) that are directly applicable to service organizations such as health and education organizations, among other. Gouldner suggests that there is an internal contradiction within the bureaucratic model since it is difficult to have an expert-based authority system that is based on the degree of expertise and professionalism and another that is based on hierarchy and discipline that has more to do with the position of the person. To do this, Gouldner distinguishes between those he calls "cosmopolitan" who have a small degree of loyalty to the company and a high degree of loyalty to their profession, while "locals" have a high loyalty to the company.Alvin Gouldner goes a step further and points out that the entry of professionals in companies can be an additional source of conflict since in many occasions they have knowledge above the hierarchical superiors. In the book by Dr. Donald Cole and Eric Gaynor mention is made of this particular phenomenon of professionals and the conflicts that they experience within the company, presenting a resolution to this dilemma in the form of "professional suicide or organizational murder".Donald Cole and Eric Gaynor mention this particular phenomenon of professionals and the conflicts that they live within the company, presenting a resolution to this dilemma in the form of "professional suicide or organizational murder".Donald Cole and Eric Gaynor mention this particular phenomenon of professionals and the conflicts that they live within the company, presenting a resolution to this dilemma in the form of "professional suicide or organizational murder".
For Gouldner the social sciences must have a critical role within society, privileging the freedom and autonomy of people. Mechanistic organizations presuppose human postulates that go beyond the mechanistic. We, as biological beings, can operate under certain routines, but their excessive preponderance in the organizational world can have dysfunctional consequences for our development as people.
- Jaques, Elliot
Elliot Jaques ("Requisite Organization"; Cason Hall & Co. - 1990: others: "The changing culture of a factory" - 1951 / "Time-span handbook" - 1964 / "Glaciar Project papers" with Wilfred Brown - 1965 / " The form of time "- 1982 /" Free enterprise, fair employment "- 1982 /" Creativity and work "- 1988). He graduated in Psychology from the University of Toronto and in Medicine from John Hopkins Medical Col. After working in the Canadian Navy, he was part of the staff of the Tavistock Institute of Human Relations where for several years he conducted a research job at the Glacier Metal Company, making use of the technique known under the name of action research.
Jaques was always very interested in integrating individual development with that of communities and countries, and how this could be achieved through organizations. For Elliot, the measures adopted by the monetarist economists and also the Keynesians are totally inappropriate to solve inflationary problems that in turn cause unemployment. One of Jaques' main arguments is that every nation generates as much work for its population as it really wants to do, regardless of the prevailing economic conditions.
However, there is a necessary condition for achieving full employment without inflation that can occur through differential pay as a result of a political consensus based on a pay scale for fair work subject to different levels of "discretion of the temporal scope" (see Elliot's work entitled “The measurement of responsibility”.
The discretion of the temporal scope suggests that the main criterion for evaluating the importance of a job is based on "the duration and length of time between a person's decision-making period and their review and evaluation." Usually in the lower levels of the organization the controls are carried out frequently, while it is expected that the control of the decisions taken in the upper levels sometimes lasts a very long time, and may even take several years.
One of Jaques's observations shows that these increases in temporal scope discretion do not necessarily occur continuously as one moves up the organizational pyramid; rather the increases are staggered and divides them into seven stages:
- up to three months, up to one year, two years, five years, ten years, twenty years, and more than twenty years.
In this way, differences between the different categories are recognized, which in turn justifies a difference in pay. Those at the first level (up to three months of temporal scope discretion) would accept that those at level two (up to one year of temporary scope discretion) would get better pay and would consider it unfair that this was not the case.
And this is one of the main questions asked by Jaques: How can we make sure that a pay level is correct for a particular type of work, and more especially, how can we make it fair and equitable in relation to "Another" job and another pay? For those interested in fair pay as a motivational theory, it is suggested that you review Adams' excellent work on equity theory.
Jaques suggests that people are more effective when the position they occupy within the organization has an appropriate relationship between payment and the discretion of the temporal scope, something that almost no other author has paid attention to, despite the importance of remuneration as a factor. motivational.
In a field study, the author shows that for those with a three-month time span, an income of about £ 7,000 was perceived as equitable in England and $ 20,500 in the United States of America. For those with a two-year time span the amounts varied significantly: they were £ 19,500 in England and $ 60,000 in the USA.
It is also important to note that for Jaques a bureaucracy is that organizational type where employees answer to their superiors for the work they do, which is not always applicable to university professors or union representatives.
In bureaucratic-type organizations such as multinational corporations and corporations, government entities, and the military, as one moves up the pyramid hierarchy, discretion in temporal scope increases and the seven basic categories described above are related to levels of mental competence that ranges from concrete thinking at the bottom of the pyramid to the development of abstract models and institutional creation at the top of the company. And the capacities to be able to function with higher levels of abstraction with a greater scope of discretion over the top of the company, are definitely typical characteristics of effective and efficient bureaucracies, which have to be generally accepted by organizational participants,which in turn allows for an equitable payment based on capacity without prevailing a surplus value derived from work positioned at the lower levels.
A characteristic present in Jaques' work during his career has to do with a special consulting practice, attending meetings where personal, social and technical factors come to light. Among the findings to be taken into account by practitioners, it has been found that many of the problems discussed in these meetings were nothing more than symptoms of longer-range problems with greater implications.
It was also learned through them that people participating in these meetings - whose activities were sometimes in conflict or at least confusing in relation to the tasks assigned to their particular sector - felt the need for their roles and status were more clearly defined both for themselves and in relation to third parties.
This implication is also not usually taken into account by practitioners and company managers, adding organizational confusion that can precipitate situations of professional suicide or organizational murder (Dr. Donald Cole and Eric Gaynor).
Those who are interested in what happens in the subsidiaries of multinational corporations within the Latin American sphere should also take into account Jaques' findings. It is likely that what these young professionals have when joining these corporations may not coincide with what happens in organizational life, and learning this fact is not always easy but rather painful and detrimental to the career of a professional.
- Mintzberg, Henry
Henry Mintzberg graduated from MIT - Sloan School of Management and for many years has taught Management in the city of Montreal, Canada, at Mc Gill University, being also a Visiting Professor in France (University of ISSA-en-Provenle).
The question asked by Henry Mintzberg ("The nature of managerial work"; Prentice-Hall - 1970 / "The structuring of organizations", Prentice-Hall - 1979 / "Structures in five: Designing effective organizations"; Prentice-Hall - 1983) formula has to do with What do managers do when they work? And furthermore: In what type of organizational arrangement do managers work? To a large extent Mintzberg does not take the assumptions of bureaucratic organization as valid and also questions the conceptual frameworks of Frederick Taylor and Henry Fayol. Managers represent a very important link between the directors' strategy and the tactics and procedures to be carried out at the lower levels of the organization. And, following Mintzberg, managers do not always do what they are told to do; even more,they do other things that are not entrusted to them.
We can include Henry Mintzberg among the group of researchers and academics of "high pragmatism". He has shown that there is a huge difference between what managers do and what they have been asked to do. Their field work shows that managers have a strong preference for "verbal contacts" by spending a lot of time on conversations; Therefore, those who see companies as a conversational arrangement are not far from the truth. In addition and during their work, managers carry out different activities such as breaks, interruptions, summaries, variations, divisions and fragmentations, summons, starts, midgame and endings.
Taking into account the fragmentary nature of the manager's activities, he suggests that managers play different roles in the performance of their activities, which according to Mintzberg are ten in total, which in turn can be grouped into three important areas:
- interpersonal, informative, and decision-making.
In turn, the interpersonal area covers three main roles:
"Apparent" head, as a result of the need to exercise formal authority derived from the position they occupy as representatives within the company;
Leader. As leaders, managers must be able to effectively integrate the entity's needs with those of the organizational participants under their command;
Tie. Field studies of work activities have shown that horizontal relationships are important for effective managerial performance, weaving, building and maintaining a network of contacts and relationships that are vitally important.
Another important area is the one that Henry Mintzberg groups under the name of “informative”. He is not the only one who makes us know the importance of the cognitive in organizations, for which he shows some similarities with Herbert Simon and James March. This task of collecting, disseminating and transmitting information includes three main roles:
Monitoring. The function of monitoring what happens in the organization, receiving information on both internal and external events and events and transmitting it in turn to others, is among the most important activities of managers.
Transmitter. Henry calls this process a role of transmission or dissemination, which is related to passing information de facto (based on facts) or interpretive (based on acts that reflect our perceptions and feelings).
"Announcer". The organization exists in its context thanks to the contributions of Customers and suppliers, among others. In their daily actions, managers must issue information outside the organization both to the general public and to people who are in positions of influence.
Like the authors who are within the cognitive approach, Henry Mintzberg considers the decision-making role as the most important one in all managerial activities. Within the decision-making role Mintzberg identifies four of them:
Entrepeneurs. Organizations are characterized by two very clear orientations: 1. that of parameterizing the behavior of organizational participants; and 2. to routinize everything that is routinizable. The conjunction of these two postulates in the face of situations of change in the context make it essential that "things change" and be done in a different way. This is the task of the manager in his capacity as entrepeneur, for Henry Mintzberg. Managers are likely to have to initiate change and even take direct action deciding what to do. It is understood that these acts are carried out voluntarily and not by imposition, since if this were the case, the managers would not be performing as entrepeneurs.
Riot manager. Of course, in organizations not everything works as it is organized from the very moment of its creation and neither on the basis of "what the top has in its head". There is a lot of turbulence that makes the future and sometimes even the current scenario unpredictable, and many of the things managers need to act on are beyond their control. This managerial task of planning a stable temporary scenario and of reacting to the changes brought about is a vital task of every manager that he must not forget.
Distribution of resources. Contrary to what many managers think, the range of resources that each of them has available is enormous… and very rarely used in the interests of the company. Managers make permanent decisions regarding how to allocate resources of all kinds, such as: money, people, teams, and time, among others. And, according to Mintzberg, we must not forget that by distributing resources, managers are distributing time, planning jobs, and authorizing actions among others.
Negotiation. This is a very important role in the eyes of Henry Mintzberg who includes it within the decision-making category since "exchanging resources in real time". The manager is permanently negotiating with others inside and outside the company, and in those instances he is making decisions regarding the degree to which he commits organizational resources.
Having focused his interest on what managers really do, Henry Mintzberg suggests that within the ten roles described, information has a vital role. Managers largely determine the importance and priority of the information. And it must be taken into account that through interpersonal skills they acquire information and as a result of decision-making they put information into action.
The implications of Henry Mintzberg are far-reaching for those interested in the processes of organizational effectiveness and efficiency. However, in Latin America the concepts and practices derived from Henry's work have been little listened to and even less put into action. Professionals today do not know why they have problems inserting themselves within organizations, especially in large multinational corporations. If they took into account Mintzberg's excellent work they would have been "alerted" to say the least,of the decreasing importance of professional discretion in corporations where, through the binary system of computer technology, information - and consequent decision-making - is carried out without the need for this important Diplomatic force (it is regrettable that the Centers for Higher Studies and the best universities do not do much about it either).
For more details see the book by Dr. Donald Cole and Eric Gaynor: "Professional Suicide and Organizational Murder". The integrated processes of the Organization with its force of inputs through methodologies such as “Supply Chain Management” and with its force of outputs - Clients the methodological tool “Customer Relationship Management”, make the discretion and rationality that represented the most significant contribution of professional strength in large corporations. And this process is not there to stay but rather to move forward (Eric Gaynor - Congress of The Organization Development Institute, Zimbabwe).
Returning to Mitzberg, we must emphasize that due to the importance it attaches to information, it also drags early the concept of organizational learning and especially that of managerial force. Henry maintains that management is an art and as such they must try to continually learn about the situations they experience and learn through "others". We could say, following Mintzberg, that Management schools have been quite effective in training technocrats to operate with structured problems rather than to operate in unstructured situations.”Eric Gaynor maintains that most of the best centers of higher studies and also the best universities spend the vast majority of their time explaining phenomena that occur in extreme situations… that do not occur in reality (Congress of Organizational Development, Buenos Aires, May 2002).
As we mentioned at the beginning of this section, Mintzberg, in addition to investigating what managers actually do, spent much of his time learning about the types of organizational arrangements in which managers do things. And for this it develops a very particular typology that must be taken into account by those interested especially in organizational transitions. And they are a total of five which Mintzberg calls "Structure in Fives"; All of them are detailed in English below, respecting the author:
Simple Structure
Machine Bureaucracy (Mechanistic Bureaucracy)
Professional Bureaucracy
Divisionalized Form
Adhocracy (Ad-Hoc Organization)
In the form of a simple structure, the "top strategy" predominates in the organization, and may be the Board of Directors, the President or the General Manager accompanied by their personal staff. In this way, a strong influence is exerted towards centralization, achieving coordination through direct supervision from the top down since power is centered at the top.
In general, this type of company does not develop formal plans and programs (much of what is at the top is in the head of the leader), there is not much emphasis on training and coaching (the income and permanence system is based on the fact that “ or nothing or drowns ”), formal procedures are replaced by verbal communications, and we find high flexibility typical of the“ organicist ”arrangement mentioned by Burns (1961).
There is no “technical structure”, the support staff is minimal, there is no clear differentiation between the managers and the hierarchy levels are rather low. In reality most of the companies arise and originate supporting their development in this model that is the prevailing one during the first times.
Furthermore, there is a lot of evidence that a large number of companies prefer to stay within this arrangement before growing and having to adopt the other organizational forms. A retail store, a car dealer, a fledgling industry, a new school may take this form.
The Harvard literature suggests that this organizational arrangement is not a growth model, but it is forgotten that within this type of company, organizations are created that give work to more than 80 percent of the employed population on the planet with genuine work, and that it is these people who allow large corporations to have a large number of Clients.
Various field and research works carried out by Eric Gaynor (1979, 1993, 1997) show that many times the staff feel very comfortable in this type of company since they have a mission and meaning in life beyond products and services. that they deliver to the market. Of course, many people resent the rather authoritarian - paternalistic type who seems to contradict democratic practices. Perhaps the most vulnerable point of this type of organization has to do with the fact that a simple heart attack removes all the coordination component that sustained the company for long years.
When the organization takes the form of "Mechanistic Bureaucracy" it is the technical structure that predominates, which would include planning personnel, from the area of time and movement studies, operational research, training, and production planning and control.
Technicians and specialists are incorporated to make the organization more predictable, thereby increasing its degree of security, but it must be borne in mind that it also adds costs - relatively high - for those who carry out these tasks. Taking into account the degree of specialization of these people, it is very common for the company to increase the level of standardization in its effort to be more predictable. Since the work can be subdivided into a series of multiple tasks of a repetitive and routine nature, it is possible to develop norms, rules and procedures that in practice function as an element of control.
When organizations choose this type of arrangement, they have generally gone through “expensive” situations where they have learned by trial and error that a couple of failures have brought them to the brink of bankruptcy, whereby control becomes in an obsession. The proverb with which they feel comfortable in this type of company says something like this: "How lucky there was Baba… he only had forty thieves to deal with." This Mechanistic Bureaucracy model follows the “Simple Structure” model in terms of degree of centralization (following Pugh).
The substantial difference lies in the fact that the power that was concentrated at the top of the pyramid is now distributed in the Techno-structure, which does not always ensure achieving the expected results and even less the desired ones. Mintzberg would include in this category an airline, a steel manufacturing company, an assembly line manufacturing manufacturer, a prison and probably some educational centers that perform custodial functions. They are organizations that operate in rather stable contexts with repetitive tasks.
However, one of the great problems that this type of organization faces has to do with the immense amount of conflicts that prevail in both the horizontal and vertical relationships. Let us remember that the enormous and excellent coordination task carried out by the owner under the organization that takes the form of Simple Structure (until the moment of the heart attack) is not satisfactorily triggered by the techno-structure. Inventions and developments like that of the typical committee do not represent a long-term solution; that is why if someone wants to know that he is a camel, he will surely find this answer: "It is a horse made by a Committee."
Problems found under the organizational type of Mechanistic Bureaucracy operating under the techno-structure need to be overcome with specialists who have already been trained before joining the organization. It is not possible to create a "superior" organizational type within the techno-structure scheme. As the organization has an “operating core” that is oriented towards different needs of the Clients, it is also necessary to have highly trained professional specialists. And the type of training is usually accompanied by what was received before entering the company, as is the case of people who enter hospitals and health centers, universities and other organizations of educational centers, accounting and auditing firms,companies that provide ISO 9000 services that require artisans - professionals who master their profession and who have not only been fully trained in the exercise of their profession but also indoctrinated on ways of behaving.
Working in this type of organization becomes more complex, which makes it difficult to carry out controls on the tasks, and the obsession with control leads nowhere. We see then that just as in the Mechanic Bureaucracy the operation consists of the authority derived from the hierarchy, in the Professional Bureaucracy compliance is obtained through the expertise of its professionals. Just as the standards in the Mechanism Bureaucracy are established by norms, rules and regulations. and internal procedures, under the organizational arrangement of the Professional Bureaucracy, it is the external bodies of the different professions (Professional Councils) that establish the codes of conduct, ethics and also the "best practices" to operate (as is given in the Professional Councils). of Medicine and Accounting).When it comes to Professional Bureaucracy, what prevails is the “operating core”, with the participation of those who are at the heart and core of the business.
In an industrial company they would be those of the production area, sales force and in a service company such as the hospital we would include nurses and doctors. In a University, they would be the body of professors.
This type of organization is perceived as democratic but has major problems in terms of coordination and jurisdiction. Who teaches occupational medicine, the Medicine department, or the Law department? As we see, a problem that remains within the organizational world has to do with coordination between the different organizational participants.
Now, to the extent that the organizational type is reflected in a Professional Bureaucracy, the problem is much bigger since we find different highly professionalized super specialists who excel in their area of expertise, which brings us to the next question about Resolve: Who gathers the powers to coordinate in these situations of litigation and discrepancy?
In Henry Mintzberg's work a new organizational arrangement emerges which is the one most practiced by large multinational corporations. For Mintzberg in these companies there is a "Pentagon" that controls many Mechanistic Bureaucracies, and calls this form under the name of Divisional Structure. Under the organizational form of the Divisional Structure it is the “middle line”, or the people who direct managers, in some way those who deal with the “strategy at the top” and the “operating core”. We could include the Sales, Production and Purchasing Directorates within a manufacturing industry as well as the managers who report to them. Many times the Divisional Structure is nothing more than a Mechanistic Bureaucracy that has diversified in space.
Each of the divisions may have some degree of autonomy, but generally this autonomy exists only within very narrow ranges. When multinational corporations, due to changes in the context, find it extremely difficult to survive, they pass the business on to their "competitor", or "absorb" the other's business. It is a mere financial operation that is outside the business world (it is important to distinguish between the business world and the business world - financial).
In the movie Pretty Woman, when the prostitute is surprised by the excellent standard of living of a financier, she asks: How do you live? What do you really live on? And the main actor, in the role of financier, lets him know that he lives in the world of financial business (that generates money)… for which he often undoes companies (that generate work). Mintzberg suggests that the Divisional Structure seems to be the prevailing one in today's world, but he warns that of the five organizational designs this organizational form is probably the most vulnerable to social and legal changes. Another important reason is due to the fact that the control from the "Pentagon" is carried out through different quantitative indicators,that do not take into account the qualitative aspects that also have a significant importance in the survival and growth of the company in the medium and long term.
Now, in highly turbulent markets, with Professions that have an expiration rate of about 7 to 9 years, with Client needs that change between 6 and 12 months, with the principles of Alvin Toffler (“Future shock”; N. York - 1970) current (novelty, diversity and transience) the four organizational forms described are facing a great threat. Perhaps the Professional Bureaucracy is the one with the best antibodies to survive, but in any case it is not enough to have the rhythm and speed required by current circumstances. But the new form should not have one of the limitations of Professional Bureaucracy: the repetitive use of standardized professional skills. The new organizational form must be both organizational and decentralized.
This is how the Ad-Hoc Organization finally emerges with one of its prevailing parts that has to do with the "support staff". In a typically manufacturing company we could include the research and development department, the public relations area and we could even dare to add the cafeteria area. And in addition to the "support staff" it is important that this new organizational type has an "operating core" that would be made up of experts dedicated to innovation. Professionals in this type of organization must show that their specializations include skills to work effectively in work teams, with specialists in completely different areas. Henry Mintzberg identifies two variants of the Ad-Hoc Organization:the operative that works directly for the Clients and the administrative one that is rather oriented towards a project (like NASA). In the very nature of the Ad-Hoc Organization we find innovation, which is the very reason for its existence… and also for its problems, conflicts and dilemmas.
We do not have to find a pure organizational type as organizations are constantly on the move and what we also have to find is that all these five parts have their influence in attracting a particular type of organizational arrangement. Mintzberg speculates with other organizational arrangements where ideology prevails over the rational component, which he calls Missionary Structure. In this type of organization, the different participants are involved in meaningful actions that give meaning to their own lives. Summarizing, and according to Henry Mintzberg, the Simple Structure and the Mechanistic Structure have to do with the past,while the Professional Bureaucracy and the Divisional Structure belong to the current organizational world and the Ad-Hoc Organization is the most efficient organizational arrangement for the future.
We must grasp these important suggestions made by Mintzberg, especially those of us who work and live in Latin America. In the Organizational Development Conference held in the Province of Chubut, 2001, Eric Gaynor identifies situations where each of these different organizational categories may be the best way to manage companies according to their size, the sector in which they work and the stage of its development.
- Pugh, Derek
During the 1950s, Dr. Derek Pugh ("The measurement of organization structures: does context determine form?"; Organizational Dynamics - 1990) developed a very particular way to investigate while at the Birmingham College of Advanced Technology, which was later transformed at Aston University. A particularity of Dr. Pugh and that has benefited him extensively in his long career is due to the fact that he always worked together with other researchers and social science scholars, which allowed him to integrate multi-disciplinary aspects into his conceptions. In the works carried out during the 60's of the last century, Pugh worked with different experts in psychology, sociology, economics, and politics, and that is why it is frequent to see publications and works by Pugh with other renowned characters:Child, John; Hickson, David; Hinings, Bob; McMillan, Charles; Payne, Roy; Pheysey, Diana, this team being known as the Aston Group.
This group made an enormous effort to integrate research methods and hypotheses of organizational psychology with conceptual frameworks of economics and sociology. They stood out for three main concepts:
The need to make use of a multi-variable approach where the different attributes are taken into account together and privileging the different degrees of the variables instead of privileging the choice of one or two variables where the color black and white appear. This suggests that the reasons why organizations are effective has more to do with a multitude of influences than with one or two variables in particular (organization size, or technology).
Taking into account that organizations go beyond the very existence of people, it is advisable to study and analyze non-personal or institutional aspects, taking into account the division of labor, control systems and formal organizational hierarchies.
Considering that organizations are complete entities in themselves, both they and their organizational participants must be viewed from more than one perspective. In other words, for example with the dilemma if the person makes the man or the other way around, it is good to keep in mind that both occur at the same time.
Derek Pugh and David Hickson (“Organizational structure in its context: The Aston Program I” - 1976) suggest that in short, the Aston Group tried to link three vital aspects of any organization:
its operation and organizational structure;
how the groups and their interaction were composed; and
individual behavior and personality.
This very ambitious work of the Aston Group trying to integrate the three analysis units (individual, group and organization) was launched by studying almost 50 organizations within the Birmingham area in England.
The formal organizational structures were analyzed in terms of "degrees" of the following variables that are present in the works of Fayol, Taylor and Weber:
- Degree of specialization of functions and roles; Degree of standardization of procedures; Degree of formalization of documentation; Degree of centralization of the authority system; Degree of configuration of the role structure.
The first three variables were integrated into one under the name of "degree of structure of activities / tasks" as they were developed by the staff. And the fourth variable had to do with the “degree to which decision-making is concentrated at the top of the organization”. In this work with 46 organizations, these last two variables were related to other organizational factors such as: organizational purpose, company ownership, technology, size of the organization, among others. Among the conclusions we can mention that there was NO relationship with the organization's property and its technology. On the other hand, a relationship was found between the variables studied and the "size of the organization" as well as "the degree of dependence on another organization".
The larger the organization, the more its employees have to work in more specialized functions where the procedures are highly standardized and the documentation is highly formal, the organizational arrangement having a bureaucratic type form with a high degree of activity structure. On the other hand, and in relation to "the degree of dependence on another organization" - understanding as total dependence those organizations that are owned by others taking into account that from outside it all their needs are provided and all their needs are taken products / results - there will be less “autonomy in decision making”. It may even seem that these organizations are autonomous although in reality they are not.
These conclusions, and especially the last one, should be taken much more into account by scholars, professionals, academics, consultants, and practitioners in Latin America, since they are highly applicable in the case of subsidiaries of multinational corporations. The implications of these conclusions go beyond the mere organizational aspect as they also impact the “individual” unit of analysis and, especially, in the development of their career. Many professionals join subsidiaries of multinational companies having in their heads an organizational model and also an ideal career development model that often does not coincide with reality (Dr. Donald Cole and Eric Gaynor: “Professional Suicide or Organizational Murder”).
Pugh and Hickson note that these findings were replicated in other projects by these same researchers, although they make the caveat that many of these elements changed over time as organizations change in size and also delete (and also add) new documents.. And it is here where the researchers incorporate a new variable: "strategic choice", especially due to the contribution of John Chile ("Organizational structures, environment, and performance: the role of strategic choice"; Sociology - 1972).
Apparently it is managers and administrators who “choose” for an organization to grow or enter into contracting relationships that makes it dependent on another. It is they who choose the means of managing and controlling the "activity structure" and to what extent authority concentrates. But this is not a static relationship but rather a dynamic one; one choice has an effect and limits the next, and not necessarily more than one variable always has the same "augmentative" impact on the other.
The impact of the Aston group has been worldwide since its investigations have expanded to countries such as Poland, Sweden, Israel, India, Japan, Hong Kong, the United States of America, England, Scotland and Canada, applied in different organizational arrangements that include an extremely broad spectrum such as, private companies, government companies, unions, municipalities, and religious institutions. Among the planetary findings we can mention the following:
- High level of centralization in organizations within Poland High level of structuring in Japanese companies Lower degree of structure in paternalistic companies in Hong Kong
A striking finding is made by a researcher associated with the Aston Group (L. Donaldson: “Size and Bureaucracy in East and West: A preliminary meta analysis”; The enterprise and management - 1986) who shows a direct relationship between structure and organizational size but inverse between size and degree of centralization. On the other hand, Hickson, Hinnings, and others have consistently shown the hypothesis where differences are present regardless of culture.
Continuing with its extensive research work, the Aston Group focuses its interest on bureaucracies, for which they describe four main types, which for purposes of better understanding, are not translated into Spanish that result from the combination of their two main variables.: to. concentration of authority, and b. structuring of activities.
Large companies are what they call "workflow bureaucracies" and combine a high degree of activity structure with a low concentration of authority.
Public government companies are defined as "personnel bureaucracies" and are characterized by not having much structure but with a high degree of concentration, placing special emphasis on the procedures for the selection, promotion and dismissal of personnel.
Smaller organizations both within public and private activity are called “full bureaucracies” and have both a high degree of structuring and concentration of authority.
Small organizations under the “ownership” system and with the figure of the “owner” are characterized by having a low structure and low concentration of authority.
One of the riches of the Aston group's work is that it has added complexity to the topic of "bureaucracy" that has generally been oversimplified by many professionals and practitioners in particular. They present a more complex model of bureaucracy and among other facts, suggest that within this typology there is something that seems true: there seems to be no difference for those who are at the bottom of the organizational pyramid regardless of the type of bureaucracy in question. On the other hand, those people who are at the top of the organizational peak are very likely to have a very different life depending on the particular type of bureaucracy to which they belong. Contrary to what many people suppose,Organizational participants are quite happy to belong to a bureaucratic organization, according to the work of the Aston group.
In another study, they found that at the top of bureaucratic organizations they found managers who were younger and at the same time better qualified, with greater flexibility and content with challenges. And apparently these companies with younger people showed a tendency to grow faster in both sales and assets, so that these people did not necessarily appear to be more cautious and conformist since they took risks and showed an innovative profile. What we do not know is whether it was youth that caused growth in both sales and assets, or whether it was the growth factor that led to the recruitment and support of younger people.
Both Hickson and Hinings (“A strategic contingencies theory of intra-organizational power”; Administrative Science Quarterly - 1971) showed interest in the second unit of analysis, that is, the internal groups belonging to the organization. With the purpose of learning about which internal groups exercise more power over the rest of the groups, and also over the organization, in an investigation they were oriented to investigate regarding “intra-organizational power”. This work would shed light on why some departments with specialized staff may come to exert more influence on the organization as a whole, while other departments of the company with lower levels of knowledge and specialization may even be replaced and supplanted by others.Hickson went on to develop a typology of decisions adopted by senior management that covered the following groups:
- sporadic, fluid, and restricted, showing that each of them had a particular type of behavior and time scale. For her part, Hinings, together with Greenwood, dedicated herself to investigating particular paths that organizations follow under situations of successful change, unsuccessful change, or permanent situation.
- Weber, Max
The contributions of Max Weber (“The theory of social and economic organization”; Oxford - 1947) in relation to Organizations are strongly related to what is known under the term “Bureaucracy”. It is extremely unfortunate that it is referred to in everyday language with a completely opposite meaning to the conception of its creator, which is highly paradoxical.
Max Weber (1864-1920), a German national, dedicated most of his life to academic activity having been a member of the University of Berlin. Weber devoted much of his energy to the historical development of civilizations, which he accomplished through the sociology of religion and also the sociology of economics. He studied economic development in detail since pre-feudal times and has stood out for its religious scope by integrating different religions such as Christianity, Judaism and Buddhism. From the religious combination with economic development emerges a central part of his work considered as "Protestant ethics" and its economic impact on the development of Western Europe and the United States of America.
One of Max Weber's most important contributions has to do with the impact of authority relationships within organizations. The question that Weber is interested in answering has to do with: Why do people obey and follow the instructions they receive? For this Weber differentiates the concept of power from that of authority. Power has to do with the ability to get people to obey, while authority is voluntary compliance as a result of orders received.
Based on the concept of authority, Weber analyzes three different types of Organization, and chooses the bureaucratic organization as the dominant type based on the fact that, in his opinion, this type of organizational arrangement has greater technical efficiency.
The Organization Development Institute International has developed various field and research works in recent years and, the result of them, shows an important distance between what the Directors, Executives and Professionals think the bureaucratic model is in relation to what Max Weber conceives as Bureaucracy (see Eric Gaynor Butterfield's Presentation, Dublin, 1999).
Weber conceives of three main types under which authority is legitimized, distinguishing between them by choosing how organizational legitimacy is validated. Organizational compliance can be achieved on "traditional" bases based on the sanctity of historical traditions and the consequent legitimacy based on the status authority of those who are depending on them. Under this traditional authority, organizational compliance is obtained through obedience to the person who depends on the highest authority. The obligation to obey is independent of an impersonal order; it is rather the result of personal loyalty within an area of obligation based on custom and tradition.
Another type is the one based on the charism. In this case, organizational compliance is achieved as a result of a devotion to a particular person, sustained by her exceptional holiness, exemplary character and heroism. This also includes obedience to the normative patterns, orders, and instructions that are revealed by this charismatic leader. In this case of charismatic authority, it is the charismatically qualified leader who is obeyed by the personal trust placed in him (and in his "revelation," heroism, or exemplary qualities). This occurs as long as it works within the scope of the individual's belief within the leader's charism.
The third "pure" type is based on the rational. Organizational compliance is here obtained on the legitimacy of rules and regulations and the exercise of those elevated to positions of authority, who, under said rules, have legal authority to issue orders and instructions (legal authority).
Legal / rational authority - and its consequent effectiveness - depends primarily on acceptance regarding the validity of the following concepts and practices that are mutually interdependent.
Any norm, rule or legal provision can be established by agreement or by imposition, on the basis of rational or logistical principles or both, being obeyed even if only partially, by the corporate group. This generally includes all those within their own sphere of authority or power. Therefore the organization is an active system in time where the functions are the result of the rules and regulations.
Every legal body consists primarily of a comprehensive body of conceptual (abstract) rules and standards that have been intentionally established. Furthermore, the administration of this legal body consists of applying these rules to many particular cases where, in addition to the independent and intervening variables, the “situation” emerges as a specific aspect to take into account. The delegation has a fundamental presence on which a “hierarchies” scheme is built, where each lower office is under the control and supervision of a higher office. Lower offices reserve the right to “appeal” and forward “complaints” in a bottom-up circuit. The hierarchical scheme suggests that changes can be imposed from above or, eventually,Responsibility for such changes may also be placed in the hands of the lower office, as a result of the "original complaint".
Consequently, the person with authority is the occupant of "a position" (or office). As a consequence of her status she exercises actions, which include orders instructed to others, being herself subject to an impersonal order towards which her actions and behaviors must be oriented. This is valid for all persons who have legal authority, including the President himself.
The position (or office) provides a specific area of competence. And this competence gives rise to an administrative body that mainly includes: - a sphere of obligations to perform functions that are part of a division of labor; - an incumbent who has the necessary authority to perform these functions; and - a clear definition of the means of compulsion and its use.
The person or incumbent who obeys authority (organizational compliance) does so in his capacity as a "member" of a corporate group and what he really obeys is - only - the same "law". The rights that the "official" has are not appropriate for him, but rather are intended to ensure the independent and objective nature related to the management of the office, so that everything is oriented towards the relevant standards. Legal authority can be exercised in different ways.
An additional feature is the fact that members of the corporate body, insofar as they obey a person in authority, do not owe this obedience to "him" as an individual, but to the impersonal order. Therefore, organizational compliance is obtained independently of people, and is rather a function of formalized rules, norms and instructions.
The set of rules and norms that regulate the conduct of an office can be both technical rules (basically based on "professional" efficiency) and norms (established "outside" of professionalism and rather related to "the organization as a whole ”). For Weber, training is absolutely necessary. It is obvious under these circumstances that only a person with technical training is in a position to be an organizational member, and therefore only these people are candidates for “official” positions. The officer works completely separately from the ownership of the means of production and administration and has no ownership of positions either. Also,the officer is subject to discipline and control that are both systematic and strict in the conduct of his office.
The company is organized in a way where ownership is separated from both the means of production and the administration. All company personnel, from the highest officials to the lowest levels, have no participation in the means of production or administration. Both are rather provided to them, and the "officers" are required to account for their use. Organizational members are generally remunerated under a fixed salary (in money), with a right to a pension. The officer may resign his position at any time, and this same discretion is not always in the hands of the authority. Generally, salary is in relation to hierarchy, although occasionally social status is also taken into account.The office itself is the primary - and sometimes unique - occupation of the incumbent, who thinks in terms of career within the organization. There is a promotion system that is in the hands of superiors, and depends mainly on seniority or results (or both).
Formalization is a feature that is always present in this organizational typology. And in the degree of formalization it is found that the administrative actions, the rules and regulations and even the decisions taken are formulated - and also recorded - in writing. This is true even in those situations where verbal (oral) discussion is the rule in force or even mandatory.
The legal-rational organization in its purest form is characterized by employing a bureaucratic administrative staff. Only the "supreme chief" is installed on the basis of "appropriation" (via election or appointed by succession). But even his own authority is related to one sphere - scope of competence. In turn, all those who report to the supreme chief are appointed - and in turn operate - as a result of the following guidelines: * The different organizational members are free as to "their person" and are subject to authority only in relation to your official impersonal obligations. As a result of the "principle of delegation", organizational participants operate day by day in a series of clearly defined hierarchies, each office having an area of competence in the legal sense;* These offices are occupied by incumbents under a contractual relationship based on freedom, thus existing the principle of free selection; * Candidates for the various hierarchies and offices are selected based on their technical qualifications. In the most rational sense, this is a consequence of evaluation methods (tests) and may also be guaranteed by diplomas attesting to technical competence. People are not selected under a "choice" system, but rather are designated.This is the result of evaluation methods (tests) and may also be guaranteed by diplomas that attest to technical competence. People are not selected under a "choice" system, but rather are designated.This is the result of evaluation methods (tests) and may also be guaranteed by diplomas that attest to technical competence. People are not selected under a "choice" system, but rather are designated.
For those interested in "processes" Weber has chosen the Greek term "charisma" as a way to exercise authority based on the leader's personal qualities. The charismatic leader is not an ordinary person, still having exceptional powers and attributes. He adopts the position of a prophet who reaches the masses through disciples.
However, an organization cannot be based solely on the inspiration of its leader, since at some point there must be a need for “leadership succession” and also the company cannot live with internal instability subject to the volatility of a leader..
It is very likely that the organization of the charismatic type in the face of these events will change its organizational arrangement, since it is highly unlikely to replace a charismatic leader with another who is also charismatic (history hardly records this type of situation). As a consequence, the organization moves towards one of these two options: in the event that the succession takes the form of hereditary, the organizational arrangement will be traditional, and, if instead the company chooses the adoption of rules, rules and procedures based on in the "technical-formal" rationality, in this case emerges what Weber calls the bureaucratic organization.In the case of taking the traditional form of organization, Weber distinguishes the “patrimonial” type (subordinates depend on the leader for remuneration) from the “feudal” type (where “subordinates” have greater autonomy in terms of income but continue to report to the leader on the basis of loyalty).
It is interesting to highlight a phenomenon that is strongly present in Latin American countries. As a consequence of governments with a strong demagogic orientation based on the “charism”, the competitive and business world sometimes finds no place for development even when it comes to truly innovative entrepreneurs. The charismatic leadership referred to by Max Weber of the feudal type where the "subordinates" have greater autonomy in terms of income but continue to report to the leader on the basis of loyalty as a result of alliances between political power, a profile of businessmen Under the true facade of state contractors with the conjunction of unionism - business, they have represented an almost perfect mechanism to subordinate local growth at the hands of innovative forces from abroad.The much-touted globalization shows various examples of this.
For Weber efficient companies are those that move away from both traditional and charismatic leadership. Companies cannot continue doing things "as they have been doing" if they want to be successful and survive over time, and both the organization based on a traditional authority system and charismatics cannot be prepared for effective change. Weber identifies two variables that accompany bureaucracy as the most efficient system: the rationality by which the means are revealed to achieve certain objectives; and the legal (formal) since the system and model of authority is based on a set of norms, rules and procedures that parameterize the behavior of different people in their roles.Weber is a tireless fighter against uncertainty and strives to add rationality to organizations, for which he postulates a mechanistic type model. It makes it very clear that the occupants in their respective roles must be chosen based on their technical skills for the development of their work.
The experts must also be the ones to carry out coordination and control efforts and it is hoped that they can anticipate the consequences of the different "mechanistic" acts within the organization. This makes business operations more predictable and can develop a more precise relationship between means and ends. This in turn leads us to better results and to the maximization of profits in the long term, which establishes a relationship between organizational economic benefit and religion. A moral basis is necessary - in this case the Protestant one - by which people can be industrious in their earthly life and can also achieve eternal salvation. Weber postulates that increasing industrialization will make bureaucratic-type organization more and more predominant since the other two forms,Both the traditional and the feudal ones will not be able to survive, even going far beyond the business world and covering sectors such as education, government, politics, unionism, etc.
Its implications for entrepreneurs in Latin America are truly remarkable and it is regrettable that both the professional and academic world have not taken them into account, and they were limited to a “popular” conception of the concept of bureaucracy that is totally independent and far from the conception of Max Weber.
- Woodward, Joan
Joan Woodward ("Industrial Organization: theory and practice"; Oxford - 1965 / "Industrial Organization: behavior and control"; Oxford - 1970) has made very significant contributions, especially in the industrial and manufacturing sectors, pointing out that production technology is the relevant independent variable that makes it impossible to conceive basic principles of organizational structure that are applicable to all organizations.
Woodward was very interested to know whether the organizational principles corresponding to the state of science of organizational theory were related in any way to business success as a result of their implementation. To do this, she carried out research for about five years in the mid-1950s, which was led by the Department of Research in Human Relations at South-East Essex Technical College.
The original intention of the research work was oriented towards learning about the division of responsibilities between line supervision and technical specialists who use technology in production processes, and to get to know the determining factors of the relationships between the two. Shortly after the study began, they realized that these line relationships with the staff could not be carried out in isolation, so they expanded the field of research to include the entire management and supervisory structure. The Woodward-led research paper included 91 percent of manufacturing firms with more than 100 employees in South Essex, and showed considerable variations in their organizational arrangements, which, in turn, were unrelated to the size of the company. business,the type of industry or business performance.
However, when the companies were grouped taking into account their similar objectives and their production techniques, and classified in terms of the technical complexity of their production systems, each production system seemed to be associated with a type of organizational arrangement. Technical methods appeared as the most important factor in determining the organizational structure and in setting the tone for human relations within the company. Therefore, the general assumption that there are valid management principles for all types of productive entrepreneurship, did not find sufficient support.
The study had a very detailed survey that covered, among other points:
- organizational history and objectivesdescription of manufacturing methods and processesdifferent forms and procedures that exhibit the operations of the company, such as: the organization chart; cost analysis with three main divisions: wages, materials and general expenses; an analysis of the labor structure including: proportion of direct labor over total personnel, proportion of maintenance workers in relation to production personnel, proportion of administrative employees in relation to day laborers, proportion of managers and supervisors in relation to total staff; how to operate in sales, development and personal research, inspection, maintenance and purchasing; the procedures used in planning and controlling production;current procedures regarding costs and budgetary control; the qualifications and training of managers, supervisors and staff as well as the forms of recruitment and the training policy. Information related to how to measure organizational efficiency.
The work included a total of 100 companies that had a staffing of more than 100 people (of 110 companies, 91% were included).
Among the findings, it was found that only in half of the companies did the principles and concepts of organizational theory apply. Out of a total of 20 companies that were rated "above average" only 9 of them had a clearly defined organizational pattern within the orthodox model. Woodward was fascinated by so much effort being put into developing a management science applicable to all types of productive enterprise. And some questions emerged, including:
1. Are the supervisory skills and the type of management organization required in a company in the process of radical technical change different from those companies in a stable situation?
2. Is a different type of organizational arrangement required when technical complexity affects manufacturing methods?
In order to find answers to these questions, the companies were grouped by their technical methods and from there ten different categories emerged. Companies in the same industry were not necessarily in the same group. The ten productive groups were categorized based on "technical complexity". The degree of technical complexity is related to the extent to which the production process is controllable and its results are predictable. And in doing this it was found that companies that had similar technical methods were related to similar organizational structures.
Therefore, it is concluded that the 20 companies that had excelled in their results had very little in common. However, when the companies were grouped taking into account their production system, those that were the most successful had at least one facet in common.
An additional finding suggests that norms and rules increase the efficiency of the company, this fact that must be taken into account and applied only when it comes to organizations similar to those taken into account under this work: order orders or mass production. It is suggested that compliance with rules and regulations does not always accompany organizational efficiency for another type of company.
