Appropriate Organization

Precision, speed, unambiguity, knowledge of files, continuity, discretion, unity, strict subordination, reduction of friction and of material and personal costs – these are raised to the optimum point in the strictly bureaucratic administration. (Max Weber, 1922 (1))

There is no doubt that most organisations today, of whatever kind, owe their basic design to the early 20th Century idea of bureaucracy, but we need a different meta-idea for the 21st century: a different approach to how the organisational entity as a whole relates to itself and to its environment.

Bureaucracy literally means: “The power (force) of the desk” (probably better thought of as the power of the office, as in someone who holds office) and in advocating it, Weber passionately believed that it was the most efficient form of organisation. To this day, his ideas remain deeply entrenched in our organisational consciousness despite the fact that they were born more than 100 years ago out of forms of industrial organisation that had reached their zenith after almost 150 years of Industrial Revolution.

Now a different organisational theme is needed: that of the living organism, not the machine: one that sees organisation from the bottom up instead of the top down as far as its staff are concerned; and from the outside in, rather than the inside out as far as the customer is concerned.

Bureaucracies were never intended to be responsive to customers. They were intended for efficient administration and stable output in a society massively different from what we have now.

Organisation along mechanistic, bureaucratic lines may translate into overall organisational efficiency (although not always), but it is not capable of responding to the wide variety of customer needs we find in our modern services, nor is its mindset appropriate for the customer interface, as we see time and again in the sorry stories that abound in our press and broadcast media about poor customer service and the lack of organisational responsiveness to their needs.

We must move on from the bureaucratic idea. No longer can our organisations, even those in the public sector, be just armies of faceless people, inwardly focussed, obediently under the control of the few who are concerned only with efficiency. Today, organisations need to be turned outward, connected with their environment and accountable, not just to shareholders or principal stakeholders, but to the customer who demands relationship and total satisfaction as the price of his or her loyalty.

The second half of the 20th century saw remarkable developments in management theory, in which there was increasing recognition of the importance of the individual: of his or her needs, aspirations and higher motivations; and of the need to harness this power for higher productivity. However, in a remarkable echo of the past, the Technological Revolution which started at the end of the 20th century is allowing a resurgence of the machine mindset. Put very simply, the technology is once again driving the organisational paradigm.

Just like their mechanical counterparts of the 18th and 19th centuries, computers are replacing humans and are even mediating transactions, which people otherwise would have conducted on a personal level. Once again, in the name of efficiency and lowest cost production, human beings are becoming servants of the means of production and that is de-personalising the individual and allowing a resurgence of the old paradigm of organisation based on control through the use of power.

Here we are at the beginning of a new millennium, living in the most dynamic times ever experienced, where flexibility and engagement are most needed by organisations in our complex society and yet we see them being run on 19th and early 20th century ideas of organisation and management.

Today, we need organisations that are organismic not mechanistic. Able to embrace the individual employee’s contribution to the entire process, and we need an organisational design that allows emergent, self-organising, self-managing behaviour to happen.

The people – who are the organisation after all – need the freedom to function more effectively: self-actualising and bringing their personality and relational inventiveness to the job in hand for the overall benefit of the customer. Getting to the loyal, satisfied customer will only happen through the loyal, satisfied employee.

Organisations of all types are only going to clear the high hurdle of totally satisfying customers by being accountable to their employees first. They must create quality in their working lives, high morale and motivation, greater autonomy and trust.

Above all, there must be a change in the idea that says employees serve the organisation, to one that says the organisation serves the employees, if those employees are going to be able totally to serve and satisfy the customer. From this new stance will flow profit, efficiency and the overall objectives of the organisation.

 

(1) Wirtschaft und Gesellschaft (Economy and Society), first published posthumously in 1922

 

Dr Barry Schwartz

Barry Schwartz makes a passionate call for “practical wisdom” as an antidote to a society gone mad with bureaucracy. He argues powerfully that rules often fail us, incentives often backfire, and practical, everyday wisdom will help rebuild our world.