Organizational Studies

First Edition, 2012

ISBN 978-81-323-2562-8

© All rights reserved. Published by: Orange Apple 4735/22 Prakashdeep Bldg, Ansari Road, Darya Ganj, Delhi - 110002 Email: [email protected] 

Table of Contents Chapter 1 - Organizational Studies Chapter 2 - Bureaucracy Chapter 3 - Consensus Decision-making Chapter 4 - Decentralization Chapter 5 - Organizational Psychology Chapter 6 - Organizational Culture Chapter 7 - Motivation Chapter 8 - Emotional Labor and Co-determination Chapter 9 - Group Development Chapter 10 - Organizational Learning Chapter 11 - Group Behaviour

Chapter- 1

Organizational Studies

Organizational studies, also commonly referred to as organizational behaviour or organizational theory, encompasses the systematic study and careful application of knowledge about how people act within organizations.

Overview Organizational Behaviour studies encompasses the study of organizations from multiple viewpoints, methods, and levels of analysis. For instance, one textbook divides these multiple viewpoints into three perspectives: modern, symbolic, and postmodern. Another traditional distinction, present especially in American academia, is between the study of "micro" organizational behavior—which refers to individual and group dynamics in an organizational setting—and "macro" strategic management and organizational theory which studies whole organizations and industries, how they adapt, and the strategies, structures and contingencies that guide them. To this distinction, some scholars have added an interest in "meso" -- primarily interested in power, culture, and the networks of individuals and units in organizations—and "field" level analysis which study how whole populations of organizations interact. In Europe these distinctions do exist as well, but are more rarely reflected in departmental divisions. Whenever people interact in organizations, many factors come into play. Modern organizational studies attempt to understand and model these factors. Like all modernist social sciences, organizational studies seek to control, predict, and explain. There is some controversy over the ethics of controlling workers' behavior, as well as the manner in which workers are treated. As such, organizational behaviour or OB (and its cousin, Industrial psychology) have at times been accused of being the scientific tool of the powerful. Those accusations notwithstanding, OB can play a major role in organizational development, enhancing organizational performance, as well as individual and group performance/satisfaction/commitment. One of the main goals of organizational theorists is, according to Simms (1994) "to revitalize organizational theory and develop a better conceptualization of organizational

life." An organizational theorist should carefully consider levels assumptions being made in theory, and is concerned to help managers and administrators.

History

Kurt Lewin attended the Macy conferences and is commonly identified as the founder of the movement to study groups scientifically. The Greek philosopher Plato wrote about the essence of leadership. Aristotle addressed the topic of persuasive communication. The writings of 16th century Italian philosopher Niccolò Machiavelli laid the foundation for contemporary work on organizational power and politics. In 1776, Adam Smith advocated a new form of organizational structure based on the division of labour. One hundred years later, German sociologist Max Weber wrote about rational organizations and initiated discussion of charismatic leadership. Soon after, Frederick Winslow Taylor introduced the systematic use of goal setting and rewards to motivate employees. In the 1920s, Australian-born Harvard professor Elton Mayo and his colleagues conducted productivity studies at Western Electric's Hawthorne plant in the United States. Though it traces its roots back to Max Weber and earlier, organizational studies is generally considered to have begun as an academic discipline with the advent of scientific management in the 1890s, with Taylorism representing the peak of this

movement. Proponents of scientific management held that rationalizing the organization with precise sets of instructions and time-motion studies would lead to increased productivity. Studies of different compensation systems were carried out. After the First World War, the focus of organizational studies shifted to analysis of how human factors and psychology affected organizations, a transformation propelled by the identification of the Hawthorne Effect. This Human Relations Movement focused on teams, motivation, and the actualization of the goals of individuals within organizations. Prominent early scholars included Chester Barnard, Henri Fayol, Frederick Herzberg, Abraham Maslow, David McClelland, and Victor Vroom. The Second World War further shifted the field, as the invention of large-scale logistics and operations research led to a renewed interest in rationalist approaches to the study of organizations. Interest grew in theory and methods native to the sciences, including systems theory, the study of organizations with a complexity theory perspective and complexity strategy. Influential work was done by Herbert Alexander Simon and James G. March and the so-called "Carnegie School" of organizational behavior. In the 1960s and 1970s, the field was strongly influenced by social psychology and the emphasis in academic study was on quantitative research. An explosion of theorizing, much of it at Stanford University and Carnegie Mellon, produced Bounded Rationality, Informal Organization, Contingency Theory, Resource Dependence, Institutional Theory, and Organizational Ecology theories, among many others. Starting in the 1980s, cultural explanations of organizations and change became an important part of study. Qualitative methods of study became more acceptable, informed by anthropology, psychology and sociology. A leading scholar was Karl Weick. Elton Mayo Elton Mayo, an Australian national, headed the Hawthorne Studies at Harvard. In his classic writing in 1931, Human Problems of an Industrial Civilization, he advised managers to deal with emotional needs of employees at work. Mary Parker Follett Mary Parker Follett was a pioneer management consultant in the industrial world. As a writer, she provided analyses on workers as having complex combinations of attitude, beliefs, and needs. She told managers to motivate employees on their job performance, a "pull" rather than a "push" strategy. Douglas McGregor Douglas McGregor proposed two theories/assumptions, which are very nearly the opposite of each other, about human nature based on his experience as a management

consultant. His first theory was "Theory X", which is pessimistic and negative; and according to McGregor it is how managers traditionally perceive their workers. Then, in order to help managers replace that theory/assumption, he gave "Theory Y" which takes a more modern and positive approach. He believed that managers could achieve more if they start perceiving their employees as self-energized, committed, responsible and creative beings. By means of his Theory Y, he in fact challenged the traditional theorists to adopt a developmental approach to their employees. He also wrote a book, The Human Side of Enterprise, in 1960; this book has become a foundation for the modern view of employees at work.

Current state of the field Organizational behaviour is currently a growing field. Organizational studies departments generally form part of business schools, although many universities also have industrial psychology and industrial economics programs. The field is highly influential in the business world with practitioners like Peter Drucker and Peter Senge, who turned the academic research into business practices. Organizational behaviour is becoming more important in the global economy as people with diverse backgrounds and cultural values have to work together effectively and efficiently. It is also under increasing criticism as a field for its ethnocentric and procapitalist assumptions. During the last 20 years organizational behavior study and practice has developed and expanded through creating integrations with other domains: •

• •

Anthropology became an interesting prism to understanding firms as communities, by introducing concepts like Organizational culture, 'organizational rituals' and 'symbolic acts' enabling new ways to understand organizations as communities. Leadership Understanding: the crucial role of leadership at various level of an organization in the process of change management. Ethics and their importance as pillars of any vision and one of the most important driving forces in an organization.

Methods used in organizational studies A variety of methods are used in organizational studies. They include quantitative methods found in other social sciences such as multiple regression, non-parametric statistics, time series analysis, Meta-analysis and ANOVA. In addition, computer simulation in organizational studies has a long history in organizational studies. Qualitative methods are also used, such as ethnography, which involves direct participant observation, single and multiple case analysis, grounded theory approaches, and other historical methods.

Systems framework The systems framework is also fundamental to organizational theory as organizations are complex dynamic goal-oriented processes. One of the early thinkers in the field was Alexander Bogdanov, who developed his Tectology, a theory widely considered a precursor of Bertalanffy's General Systems Theory, aiming to model and design human organizations. Kurt Lewin was particularly influential in developing the systems perspective within organizational theory and coined the term "systems of ideology", from his frustration with behavioural psychologies that became an obstacle to sustainable work in psychology. The complexity theory perspective on organizations is another systems view of organizations. The systems approach to organizations relies heavily upon achieving negative entropy through openness and feedback. A systemic view on organizations is transdisciplinary and integrative. In other words, it transcends the perspectives of individual disciplines, integrating them on the basis of a common "code", or more exactly, on the basis of the formal apparatus provided by systems theory. The systems approach gives primacy to the interrelationships, not to the elements of the system. It is from these dynamic interrelationships that new properties of the system emerge. In recent years, systems thinking has been developed to provide techniques for studying systems in holistic ways to supplement traditional reductionistic methods. In this more recent tradition, systems theory in organizational studies is considered by some as a humanistic extension of the natural sciences.

Theories and models Decision making • • • •

Mintzberg's managerial roles Rational Decision-Making Model Scientific management Garbage Can Model

Theories of decision making can be subdivided into three categories • • •

Normative (concentrates on how decision should be made) Descriptive (concerned with how the thinker came up with their judgement) Prescripted (aim to improve decision making)

Organization structures and dynamics •

•

Incentive theory is a concept of human resources or management theory. In the corporate sense, it states that firm owners should structure employee compensation in such a way that the employees' goals are aligned with owners' goals. As it applies to the operations of firms, it is more accurately called the principal-agent problem. Bureaucracy

• • • • • • • • • • • • • • •

Complexity theory and organizations Contingency theory Evolutionary Theory and organizations Hybrid organisation Informal Organization Institutional theory Merger integration Organizational ecology Model of Organizational Citizenship behaviour Model of organizational justice Model of Organizational Misbehaviour Resource dependence theory Transaction cost Hofstede's Framework for Assessing Cultures Mintzberg's Organigraph

Personality traits theories • • • •

Big Five personality traits Holland's Typology of Personality and Congruent Occupations Myers-Briggs Type Indicator Herrmann Brain Dominance Instrument

Control and stress modelling • •

Herzberg's Two factor theory Theory X and Theory Y

Motivation in organizations Motivation the forces either internal or external to a person that arouse enthusiasm and resistance to pursue a certain course of action. According to Baron et al. (2008): "Although motivation is a broad and complex concept, organizational scientists have agreed on its basic characteristics. Drawing from various social sciences, we define motivation as the set of processes that arouse, direct, and maintain human behavior toward attaining some goal" There are many different motivation theories such as: • • • • • • •

Attribution theory Equity theory Maslow's hierarchy of needs Incentive theory (psychology) Model of emotional labor in organizations Frederick Herzberg two-factor theory Expectancy theory

Chapter- 2

Bureaucracy

Bureaucracy is the combined organizational structure, procedures, protocols, and set of regulations in place to manage activity, usually in large organizations. As opposed to adhocracy, it is often represented by standardized procedure (rule-following) that guides the execution of most or all processes within the body; formal division of powers; hierarchy; and relationships, intended to anticipate needs and improve efficiency. A bureaucracy traditionally does not create policy but, rather, enacts it. Law, policy, and regulation normally originates from a leadership, which creates the bureaucracy to implement them. In practice, the interpretation and execution of policy, etc. can lead to informal influence - but not necessarily. A bureaucracy is directly responsible to the leadership that creates it, such as a government executive or board of directors. Conversely, the leadership is usually responsible to an electorate, shareholders, membership or whoever is intended to benefit. As a matter of practicality, the bureaucracy is where the individual will interface with an organization such as a government etc., rather than directly with its leadership. Generally, larger organizations result in a greater distancing of the individual from the leadership, which can be consequential or intentional by design.

Definition Bureaucracy is a concept in sociology and political science referring to the way that the administrative execution and enforcement of legal rules are socially organized. Four structural concepts are central to any definition of bureaucracy: 1. a well-defined division of administrative labour among persons and offices, 2. a personnel system with consistent patterns of recruitment and stable linear careers, 3. a hierarchy among offices, such that the authority and status are differentially distributed among actors, and 4. formal and informal networks that connect organizational actors to one another through flows of information and patterns of cooperation.

Examples of everyday bureaucracies include governments, armed forces, corporations, non-governmental organizations (NGOs), intergovernmental organizations (IGOs), hospitals, courts, ministries, social clubs, sports leagues, professional associations and academic institutions.

Origins While the concept as such existed at least from the early forms of nationhood in ancient times, the word "bureaucracy" itself stems from the word "bureau", used from the early 18th century in Western Europe not just to refer to a writing desk, but to an office, i.e., a workplace, where officials worked. The original French meaning of the word bureau was the baize used to cover desks. The term bureaucracy came into use shortly before the French Revolution of 1789, and from there rapidly spread to other countries. The Greek suffix - kratia or kratos - means "power" or "rule".

Development Perhaps the early example of a bureaucrat is the scribe, who first arose as a professional on the early cities of Sumer. The Sumerian script was so complicated that it required specialists who had trained for their entire lives in the discipline of writing to manipulate it. These scribes could wield significant power, as they had a total monopoly on the keeping of records and creation of inscriptions on monuments to kings. In later, larger empires like Achaemenid Persia, bureaucracies quickly expanded as government expanded and increased its functions. In the Persian Empire, the central government was divided into administrative provinces led by satraps. The satraps were appointed by the Shah to control the provinces. In addition, a general and a royal secretary were stationed in each province to supervise troop recruitment and keep records, respectively. The Achaemenid Great Kings also sent royal inspectors to tour the empire and report on local conditions. The most modernesque of all ancient bureaucracies, however, was the Chinese bureaucracy. During the chaos of the Spring and Autumn Period and the Warring States Period, Confucius recognized the need for a stable system of administrators to lend good governance even when the leaders were inept. Chinese bureaucracy, first implemented during the Qin dynasty but under more Confucian lines under the Han, calls for the appointment of bureaucratic positions based on merit via a system of examinations. Although the power of the Chinese bureaucrats waxed and waned throughout China's long history, the imperial examination system lasted as late as 1905, and modern China still employs a formidable bureaucracy in its daily workings. Modern bureaucracies arose as the government of states grew larger during the modern period, and especially following the Industrial Revolution. As the authors David Osborne and Ted Gaebler point out

"It is hard to imagine today, but a hundred years ago bureaucracy meant something positive. It connoted a rational, efficient method of organization – something to take the place of the arbitrary exercise of power by authoritarian regimes. Bureaucracy brought the same logic to government work that the assembly line brought to the factory. With the hierarchical authority and functional a specialization, they made possible the efficient undertaking of large complex tasks." Tax collectors, perhaps the most disliked of all bureaucrats, became increasingly necessary as states began to take in more and more revenue, while the role of administrators increased as the functions of government multiplied. Along with this expansion, though, came the recognition of the corruption and nepotism often inherent within the managerial system, leading to civil service reform on a large scale in many countries towards the end of the 19th century.

Types of bureaucratic agencies Examining different agencies from a management point of view, they differ in two main ways: whether or not the activities of the operators can be observed, and whether the results of those activities can be observed. The first factor deals with outputs, or what the agency does on a day to day basis. The second factor deals with outcomes, or the overall results of agency work. The extreme cases where outputs and outcomes are either simple or difficult to observe yields four different kinds of agencies: production, procedural, craft, and coping. •

•

•

Production organizations are those in which both outputs and outcomes are observable. Examples include the Social Security Administration, United States Postal Service, and IRS. In production organizations, managers can observe the outputs of officials, and can (for example in the IRS) measure the amount of money collected in taxes, and estimate with accuracy how much more tax money will be produced by increasing the level of auditing activity. Procedural organizations are those where outputs can be observed, but outcomes are unclear or not observable. Examples include the Occupational Safety and Health Administration, and the United States armed forces during peace time. OSHA may observe the actions of health inspectors, but may not be able to measure how these individual actions add up to improved safety and health in the workplace. In the armed forces during peacetime, all aspects of training and deployment can be observed, but it cannot be measured how these activities deter aggression, or prepare for a future (unknown) conflict. Craft organizations are those where outputs are hard to observe, but outcomes are fairly easy to evaluate. Examples include the armed services at war, who may operate under a fog of war, but whose battle outcomes can be easily measured. Another example is the United States Department of Labor and their "Wage and Hour Division". While the outputs of individual inspectors in the field are difficult to measure, overall outcomes of negotiated compliance agreements and referrals to federal attorneys for legal action are easily measurable.

•

Coping organizations are those where neither outputs nor outcomes are observable. Typical examples include Police departments, and the United States Department of State. Some of the activities of diplomats and policeman cannot be observed or measured (e.g. sensitive conversations with foreign leaders, and interactions with citizens on the street), and the outcomes are also difficult to judge (e.g. changes in foreign perceptions of US interests, and the level of order on a policeman's beat)

An agency's type substantially impacts its approach to its mission, (i.e. the degree to which its members are devoted to accomplishing the agency's stated mission) and to compliance with the law and existing policy.

Views on the concept In a letter of July 1, 1790, the German Baron von Grimm declared: "We are obsessed by the idea of regulation, and our Masters of Requests refuse to understand that there is an infinity of things in a great state with which a government should not concern itself." Jean Claude Marie Vincent de Gournay sometimes used to say, "We have an illness in France which bids fair to play havoc with us; this illness is called bureaumania." Sometimes he used to refer to a fourth or fifth form of government under the heading of "bureaucracy". In another letter of July 15, 1765 Baron Grimm wrote also, "The real spirit of the laws in France is that bureaucracy of which the late Monsieur de Gournay used to complain so greatly; here the offices, clerks, secretaries, inspectors and intendants are not appointed to benefit the public interest, indeed the public interest appears to have been established so that offices might exist." This quote refers to a traditional controversy about bureaucracy, namely the perversion of means and ends so that means become ends in themselves, and the greater good is lost sight of; as a corollary, the substitution of sectional interests for the general interest. The suggestion here is that, left uncontrolled, the bureaucracy will become increasingly selfserving and corrupt, rather than serving society. Indeed, the cynical Parkinson's Law suggests that bureaucracies grow independent of their function.

Karl Marx In Karl Marx's and Friedrich Engels's theory of historical materialism, the historical origin of bureaucracy is to be found in four sources: religion, the formation of the state, commerce, and technology. Thus, the earliest bureaucracies consisted of castes of religious clergy, officials and scribes operating various rituals, and armed functionaries specifically delegated to keep order. In the historical transition from primitive egalitarian communities to a civil society

divided into social classes and estates, beginning from about 10,000 years ago, authority is increasingly centralized in, and enforced by a state apparatus existing separately from society. This state formulates, imposes and enforces laws, and levies taxes, giving rise to an officialdom enacting these functions. Thus, the state mediates in conflicts among the people and keeps those conflicts within acceptable bounds; it also organizes the defense of territory. Most importantly, the right of ordinary people to carry and use weapons of force becomes increasingly restricted; in civil society, forcing other people to do things becomes increasingly the legal right of the state authorities only. But the growth of trade and commerce adds a new, distinctive dimension to bureaucracy, insofar as it requires the keeping of accounts and the processing/recording of transactions, as well as the enforcement of legal rules governing trade. If resources are increasingly distributed by prices in markets, this requires extensive and complex systems of record-keeping, management and calculation, conforming to legal standards. Eventually, this means that the total amount of work involved in commercial administration outgrows the total amount of work involved in government administration. In modern capitalist society, private sector bureaucracy is larger than government bureaucracy, if measured by the number of administrative workers in the division of labor as a whole. Some corporations nowadays have a turnover larger than the national income of whole countries, with large administrations supervising operations. A fourth source of bureaucracy Marxists have commented on inheres in the technologies of mass production, which require many standardized routines and procedures to be performed. Even if mechanization replaces people with machinery, people are still necessary to design, control, supervise and operate the machinery. The technologies chosen may not be the ones that are best for everybody, but which create incomes for a particular class of people or maintain their power. This type of bureaucracy is nowadays often called a technocracy, which owes its power to control over specialized technical knowledge or control over critical information. In Marx's theory, bureaucracy rarely creates new wealth by itself, but rather controls, coordinates and governs the production, distribution and consumption of wealth. The bureaucracy as a social stratum derives its income from the appropriation of part of the social surplus product of human labor. Wealth is appropriated by the bureaucracy by law through fees, taxes, levies, tributes, licensing etc. Bureaucracy is therefore always a cost to society, but this cost may be accepted insofar as it makes social order possible, and maintains it by enforcing the rule of law. Nevertheless there are constant conflicts about this cost, because it has the big effect on the distribution of incomes; all producers will try to get the maximum return from what they produce, and minimize administrative costs. Typically, in epochs of strong economic growth, bureaucracies proliferate; when economic growth declines, a fight breaks out to cut back bureaucratic costs. Whether or not a bureaucracy as a social stratum can become a genuine ruling class depends greatly on the prevailing property relations and the mode of production of

wealth. In capitalist society, the state typically lacks an independent economic base, finances many activities on credit, and is heavily dependent on levying taxes as a source of income. Therefore, its power is limited by the costs which private owners of the productive assets will tolerate. If, however, the state owns the means of production itself, defended by military power, the state bureaucracy can become much more powerful, and act as a ruling class or power elite. Because in that case, it directly controls the sources of new wealth, and manages or distributes the social product. This is the subject of Marxist theories of bureaucratic collectivism. Marx himself however never theorized this possibility in detail, and it has been the subject of much controversy among Marxists. The core organizational issue in these disputes concerns the degree to which the administrative allocation of resources by government authorities and the market allocation of resources can achieve the social goal of creating a more free, just and prosperous society. Which decisions should be made by whom, at what level, so that an optimal allocation of resources results? This is just as much a moral-political issue as an economic issue. Central to the Marxian concept of socialism is the idea of workers' self-management, which assumes the internalization of a morality and self-discipline among people that would make bureaucratic supervision and control redundant, together with a drastic reorganization of the division of labor in society. Bureaucracies emerge to mediate conflicts of interest on the basis of laws, but if those conflicts of interest disappear (because resources are allocated directly in a fair way), bureaucracies would also be redundant. Marx's critics are however skeptical of the feasibility of this kind of socialism, given the continuing need for administration and the rule of law, as well as the propensity of people to put their own self-interest before the communal interest. That is, the argument is that self-interest and the communal interest might never coincide, or, at any rate, can always diverge significantly.

Max Weber Max Weber was one of the most influential users of the word. He is well-known for his study of bureaucratization of society; many aspects of modern public administration go back to him; a classic, hierarchically organized civil service of the continental type is — if perhaps mistakenly — called Weberian civil service. However "bureaucracy" was an English word before Weber; the Oxford English Dictionary cites usage in several different years between 1818 and 1860, prior to Weber's birth in 1864. Weber described the ideal type bureaucracy in positive terms, considering it to be a more rational and efficient form of organization than the alternatives that preceded it, which he characterized as charismatic domination and traditional domination. According to his terminology, bureaucracy is part of legal domination. However, he also emphasized that bureaucracy becomes inefficient when a decision must be adopted to an individual case.

According to Weber, the attributes of modern bureaucracy include its impersonality, concentration of the means of administration, a leveling effect on social and economic differences and implementation of a system of authority that is practically unchallengeable. Weber's analysis of bureaucracy concerns: • • • •

the historical and administrative reasons for bureaucratization the impact of the rule of law upon the bureaucratic organisations the personal orientation and occupational position of the status group of bureaucratic officials the attributes and consequences of bureaucracy in the modern world

A bureaucratic organization is governed by the following seven principles: 1. official business is conducted continuously 2. official business is conducted with strict accordance to the following rules: 1. the duty of each official to do certain types of work is delimited in terms of impersonal criteria 2. the official is given the authority necessary to carry out his assigned functions 3. the means of coercion at his disposal are strictly limited and conditions of their use strictly defined 3. every official's responsibilities and authority are part of a vertical hierarchy of authority, with respective rights of supervision and appeal 4. officials do not own the resources necessary for the performance of their assigned functions but are accountable for their use of these resources 5. official and private business and income are strictly separated 6. offices cannot be appropriated by their incumbents (inherited, sold, etc.) 7. official business is conducted on the basis of written documents Bureaucratic officials: • • • • • •

personally free. serve a higher authority. are appointed on the basis of conduct and their technical qualifications. are responsible for the impartial execution of assigned tasks. Their work is a full-time occupation. Their work is rewarded by a salary and prospects of career advancement.

Weber's work has been continued by many, like Robert Michels with his Iron Law of Oligarchy.

Criticism As Max Weber himself noted, real bureaucracy will be less optimal and effective than his ideal type model. Each of Weber's seven principles can degenerate: • •

Competences can be unclear and used contrary to the spirit of the law; sometimes a decision itself may be considered more important than its effect; Nepotism, corruption, political infighting and other degenerations can counter the rule of impersonality and can create a recruitment and promotion system not based on meritocracy but rather on oligarchy;

Even a non-degenerated bureaucracy can be affected by common problems: • •

•

• •

•

Overspecialization, making individual officials not aware of larger consequences of their actions Rigidity and inertia of procedures, making decision-making slow or even impossible when facing some unusual case, and similarly delaying change, evolution and adaptation of old procedures to new circumstances; A phenomenon of group thinking - zealotry, loyalty and lack of critical thinking regarding the organisation which is perfect and always correct by definition, making the organisation unable to change and realise its own mistakes and limitations; Disregard for dissenting opinions, even when such views suit the available data better than the opinion of the majority; A phenomenon of Catch-22 (named after a famous book by Joseph Heller) - as bureaucracy creates more and more rules and procedures, their complexity rises and coordination diminishes, facilitating creation of contradictory and recursive rules, as described by the saying "the bureaucracy is expanding to meet the needs of the expanding bureaucracy". Not allowing people to use common sense, as everything must be as is written by the law.

In the most common examples bureaucracy can lead to the treatment of individual human beings as impersonal objects. This process has been criticised by many philosophers and writers (Aldous Huxley, George Orwell, Hannah Arendt) and satirized in the comic strip Dilbert,TV show The Office, Franz Kafka's novels The Trial and The Castle, Douglas Adams' story The Hitchhiker's Guide to the Galaxy, and the films Brazil and Office Space.

Michel Crozier Michel Crozier wrote The Bureaucratic Phenomenon (1964) as a re-examination of Weber's (1922) concept of the efficient ideal bureaucracy in the light of the way that bureaucratic organizations had actually developed. Whereas for Weber, bureaucracy was the ultimate expression of a trend toward the efficient, rational organization, Crozier examined bureaucracy as a form of organization that evokes:

"... the slowness, the ponderousness, the routine, the complication of procedures and the maladapted responses of the bureaucratic organization to the needs which they should satisfy" (Crozier, 1964, p 3) He examined a number of culturally specific examples of bureaucratic organizations in an attempt to understand why bureaucracies so often became dysfunctional. After reviewing the different ways in which the term is used, Crozier describes the sense in which he uses the term bureaucracy thus: "A bureaucratic organization is an organization that can not correct its behaviour by learning from its errors" (Crozier, 1964, p 187) Adding: "... not only a system that does not correct its behaviour in view of its errors; it is also too rigid to adjust, without crises, to the transformations that the accelerated evolution of the industrial society makes more and more imperative" (Crozier, 1964, p 198) In essence, Crozier presents an argument against the Tayloristic notion of 'the one best way' to organize an activity and Weber's view of bureaucracy as the ultimate expression of rationality and efficiency. He notes that in 1964 'advanced organizations' had already: "... been obliged to discard completely the notion of the one best way [and] are beginning to understand that the illusion of perfect rationality has to long persisted, weakening the possibilities of action by insisting on rigorous logic and immediate coherence" (Crozier, 1964, p 159) From his analysis of his case studies, he develops a theory of bureaucratic dysfunction based on his observations. Although he later extends his ideas to cover other settings, the two main cases on which he bases his theory are both located in France: "The Clerical Agency" and "The Industrial Monopoly". Crozier chose these examples not only because he was French, but also because he claims that socially and culturally France has developed in such a way that it created organizations that closely resembled the Weberian notion of an ideal bureaucracy. His theory is based on the observation that in situations where almost every outcome has been decided in advance according to a set of impersonal and predefined rules and regulations, the only way in which people are able to gain some control over their lives is to exploit 'zones of uncertainty' where the outcomes are not already known. "[an] unintended consequence of rationalisation [is] the predictability of ones behaviour is the sure test of ones own inferiority" (Crozier, 1964, p158) For Crozier, organizations are not autonomous entities but social constructs that are:

"... man made and socially created [and] the indirect result of the power struggles within the organization" (Crozier, 1964, p 162) Attacking both the rationalists and the human relations school for ignoring the role that such power struggles play in the shaping of an organization he argues that organizational relations are in fact a series of strategic games where the protagonists attempt either to exploit any areas of discretion for their own ends, or to prevent others from gaining an advantage: "Each group fights to preserve and enlarge the area upon which it has some discretion, attempts to limit its dependence upon other groups and accept such dependence only insofar as it is a safeguard ... [preferring] retreatisim if there is no other choice but submission" (Crozier, 1964, p 156) The result of this is that goals are subverted and the organization becomes locked into a series of inward looking power struggles. Thus, paradoxically, the result of attempting to design an efficient organization that runs on rational and impersonal lines is to create a situation where the opposite to is true. Theory of bureaucratic dysfunction Crozier argues that: "... the bureaucratic system of organization is primarily characterized by the existence of a series of relatively stable vicious circles that stem from centralisation and impersonality" (Crozier, 1964, p 193) He outlines four such 'vicious circles' that he observed in the organizations he studied. •

The development of impersonal rules

In an attempt to be rational and egalitarian, bureaucracies attempt to come up with a set of abstract impersonal rules to cover all possible events. Crozier gives the example of the concours (competitive examinations) which mean that, one the exams are passed, promotion become simply a matter of seniority and avoiding damaging conflicts. The result, he argues, is that hierarchical relationships decline in importance or disappear completely which means that higher level in the bureaucracy have effectively lost the power to govern the lower levels. •

The centralization of decisions

If one wishes to maintain the impersonal nature of decision making, it is necessary to ensure that decision are made at a level where those who make them are protected from the influence of those who are affected by them. The effect of this is that problems are resolved by people who have no direct knowledge of the problems they are called upon to solve, and so, priority is given to the resolution of internal political problems instead. In

this case, the power to influence events over which one has direct experience is lost and it is passed to some impartial central body. •

The isolation of strata and group pressure within strata

The suppression of the possibility of exercising discretion among superiors and the removal of opportunities for bargaining from subordinates results in an organization that consists of a series of isolated strata. The notional equality within the strata becomes the only defence for the individual against demands form other parts of the organization and allows groups some degree of control over their own domain. The result is very strong per group pressure to conform to the norms of the strata regardless of individual beliefs or the wider goals of the organization. •

The development of parallel power relationships

It is impossible to account for every eventuality, even by the constant addition of impersonal rules and the progressive centralisation of decision making; consequently, individuals or groups that control the remaining zones of uncertainty, wield a considerable amount of power. This can lead to the creation of parallel power structures that give certain groups or individuals in certain situations, disproportionate power in an otherwise regulated and egalitarian organization. Once again, this can lead to decisions being made based on factors separate from the overall goals of the organization.

American usage Woodrow Wilson, writing as an academic, professed: ...[A]dministration in the United States must be at all points sensitive to public opinion. A body of thoroughly trained officials serving during good behavior we must have in any case: that is a plain business necessity. But the apprehension that such a body will be anything un-American clears away the moment it is asked. What is to constitute good behavior? For that question obviously carries its own answer on its head. Steady, hearty allegiance to the policy of the government they serve will constitute good behavior. That policy will have no taint of officialism about it. It will not be the creation of permanent officials, but of statesmen whose responsibility to public opinion will be direct and inevitable. Bureaucracy can exist only where the whole service of the state is removed from the common political life of the people, its chiefs as well as its rank and file. Its motives, its objects, its policy, its standards, must be bureaucratic. Popular dictionary definitions reflect a popular dislike for bureaucracy. The American Heritage Dictionary', after two traditional definitions of the word, the third and last definition of bureaucracy reads in part: "numerous offices and adherence to inflexible rules of operation;... any unwieldy administration." According to Webster's New world Dictionary of the American Language, one of the definitions reads in part "bureaucracy is governmental officialism or inflexible routine." Roget's Thesaurus gives among the synonyms for bureaucracy: "officialism", "officiousness", and "red tape".

American science fiction writer Jerry Pournelle has proposed a theory he refers to as "Pournelle's Iron Law of Bureaucracy", which states: "In any bureaucracy, the people devoted to the benefit of the bureaucracy itself always get in control and those dedicated to the goals the bureaucracy is supposed to accomplish have less and less influence, and sometimes are eliminated entirely." This robust tendency is purported to operate to the effect that: "...in any bureaucratic organization there will be two kinds of people: those who work to further the actual goals of the organization, and those who work for the organization itself. Examples in education would be teachers who work and sacrifice to teach children, vs. union representative who work to protect any teacher including the most incompetent. The Iron Law states that in all cases, the second type of person will always gain control of the organization, and will always write the rules under which the organization functions."

Austrian School analysis The analysis of bureaucracy by the Austrian school reflects its characteristic focus on economics, and emphasizes the distinction between bureaucratic management and profit management.

Current academic debates Modern academic research has debated the extent to which elected officials can control their bureaucratic agents. Because bureaucrats have more information than elected officials about what they are doing and what they should be doing, bureaucrats might have the ability to implement policies or regulations that go against the public interest. In the American context, these concerns led to the "Congressional abdication" hypotheses— the claim that Congress had abdicated its authority over public policy to appointed bureaucrats. Theodore Lowi initiated this debate by concluding in a 1979 book that the U.S. Congress does not exercise effective oversight of bureaucratic agencies. Instead, policies are made by "iron triangles", consisting of interest groups, appointed bureaucrats, and Congressional subcommittees (who, according to Lowi, were likely to have more extreme views than the Congress as a whole). It is thought that since 1979 interest groups have taken a large role and now do not only effect bureaucracy, but also the money in congress. The idea of "iron triangles" has since evolved to "iron hexagons" and then to a "hollow sphere." The relationships between the Legislatures, the Interest Groups, Bureaucrats, and the general public all have an effect on each other. Without one of these pieces the entire structure would completely change. This relationship is considered "mu", or such that not one single piece can describe or control the entire process. The public votes in the

legislatures and the interest groups provide information, but the legislature and bureaucrats also have an effect on the interest groups and the public. The entire system is codependent on each other. William Niskanen's earlier (1971) 'budget-maximizing' model complemented Lowi's claims; where Lowi claimed that Congress (and legislatures more generally) failed to exercise oversight, Niskanen argued that rational bureaucrats will always and everywhere seek to increase their budgets, thereby contributing strongly to state growth. Niskanen went on to serve on the U.S. Council of Economic Advisors under President Reagan, and his model provided a strong underpinning for the worldwide move towards cutbacks of public spending and the introduction of privatization in the 1980s and '90s. Two branches of theorizing have arisen in response to these claims. The first focuses on bureaucratic motivations; Niskanen's universalist approach was critiqued by a range of pluralist authors who argued that officials' motivations are more public interest-orientated than Niskanen allowed. The bureau-shaping model (put forward by Patrick Dunleavy) also argues against Niskanen that rational bureaucrats should only maximize the part of their budget that they spend on their own agency's operations or give to contractors or powerful interest groups (that are able to organize a flowback of benefits to senior officials). For instance, rational officials will get no benefit from paying out larger welfare checks to millions of poor people, since the bureaucrats' own utilities are not improved. Consequently we should expect bureaucracies to significantly maximize budgets in areas like police forces and defense, but not in areas like welfare state spending. A second branch of responses has focused more on Lowi's claims, asking whether legislatures (and usually the American Congress in particular) can control bureaucrats. This empirical research is motivated by a normative concern: If we wish to believe that we live in a democracy, then it must be true that appointed bureaucrats cannot act contrary to elected officials' interests. (This claim is itself debatable; if we fully trusted elected officials, we would not spend so much time implementing constitutional checks and balances.) Within this second branch, scholars have published numerous studies debating the circumstances under which elected officials can control bureaucratic outputs. Most of these studies examine the American case, though their findings have been generalized elsewhere as well. These studies argue that legislatures have a variety of oversight means at their disposal, and they use many of them regularly. These oversight mechanisms have been classified into two types: "Police patrols" (actively auditing agencies and looking for misbehavior) and "fire alarms" (imposing open administrative procedures on bureaucrats to make it easier for adversely affected groups to detect bureaucratic malfeasance and bring it to the legislature's attention). A third concept of self-interested bureaucracy and its effect on the production of public goods has been forwarded by Faizul Latif Chowdhury. In contrast to Niskanen and Dunleavy, who primarily focused on the self-interested behaviour of only the top-level

bureaucrats involved in policy making, Chowdhury in his thesis submitted to the London School of Economics in 1997 drew attention to the impact of the low level civil servants whose rent-seeking behaviour pushes up the cost of production of public goods. Particularly, it was shown with reference to the tax officials how rent-seeking by them causes loss in government revenue. Chowdhury’s model of rent-seeking bureaucracy captures the case of administrative corruption whereby public money is directly expropriated by public servants in general.

Chapter- 3

Consensus Decision-making

Consensus decision-making is a group decision making process that not only seeks the agreement of most participants, but also the resolution or mitigation of minority objections. Consensus is defined by Merriam-Webster as, firstly - general agreement and, secondly - group solidarity of belief or sentiment. It has its origin in a Latin word meaning literally to feel together.It is used to describe both general agreement and the process of getting to such agreement. Consensus decision-making is thus concerned primarily with that process.

Objectives As a decision-making process, consensus decision-making aims to be: • • •

•

• •

Agreement Seeking: A consensus decision making process attempts to help participants reach as much agreement as possible. Collaborative: Participants contribute to a shared proposal and shape it into a decision that meets the concerns of all group members as much as possible. Cooperative: Participants in an effective consensus process should strive to reach the best possible decision for the group and all of its members, rather than competing for personal preferences. Egalitarian: All members of a consensus decision-making body should be afforded, as much as possible, equal input into the process. All members have the opportunity to present, and amend proposals. Inclusive: As many stakeholders as possible should be involved in the consensus decision-making process. Participatory: The consensus process should actively solicit the input and participation of all decision-makers.

Alternative to common decision-making practices Consensus decision making is an alternative to commonly practiced non-collaborative decision making processes. Robert's Rules of Order, for instance, is a process used by many organizations. The goal of Robert’s Rules is to structure the debate and passage of

proposals that win approval through majority vote. This process does not emphasize the goal of full agreement. Critics of Robert’s Rules believe that the process can involve adversarial debate and the formation of competing factions. These dynamics may harm group member relationships and undermine the ability of a group to cooperatively implement a contentious decision. Consensus decision making is also an alternative to “top-down” decision making, commonly practiced in hierarchical groups. Top-down decision making occurs when leaders of a group make decisions in a way does not include the participation of all interested stakeholders. The leaders may (or may not) gather input, but they do not open the deliberation process to the whole group. Proposals are not collaboratively developed, and full agreement is not a primary objective. Critics of top-down decision making believe the process fosters incidence of either complacency or rebellion among disempowered group members. Additionally, the resulting decisions may overlook important concerns of those directly affected. Poor group relationship dynamics and decision implementation problems may result. Consensus decision making addresses the problems of both Robert’s Rules of Order and top-down models. The outcomes of the consensus process include: • •

•

Better Decisions: Through including the input of all stakeholders the resulting proposals can best address all potential concerns. Better Implementation: A process that includes and respects all parties, and generates as much agreement as possible sets the stage for greater cooperation in implementing the resulting decisions. Better Group Relationships: A cooperative, collaborative group atmosphere fosters greater group cohesion and interpersonal connection.

Decision rules The level of agreement necessary to finalize a decision is known as a decision rule. The range of possible decision rules varies within the following range: • • • • • • •

Unanimous agreement Unanimity minus one vote Unanimity minus two votes Super majority thresholds (90%, 80%, 75%, two-thirds, and 60% are common). Simple majority Executive committee decides Person-in-charge decides

Some groups require unanimous consent (unanimity) to approve group decisions. If any participant objects, he can block consensus according to the guidelines described below. These groups use the term consensus to denote both the discussion process and the decision rule. Other groups use a consensus process to generate as much agreement as

possible, but allow decisions to be finalized with a decision rule that does not require unanimity.

Consensus blocking and other forms of dissent Groups that require unanimity allow individual participants the option of blocking a group decision. This provision motivates a group to make sure that all group members consent to any new proposal before it is adopted. Proper guidelines for the use of this option, however, are important. The ethics of consensus decision making encourage participants to place the good of the whole group above their own individual preferences. When there is potential for a group decision to be blocked, both the group and any dissenters in the group are encouraged to collaborate until agreement can be reached. Simply vetoing a decision is not considered a responsible use of consensus blocking. Some common guidelines for the use of consensus blocking include: • • • • •

Limiting the option to block consensus to issues that are fundamental to the group’s mission or potentially disastrous to the group. Providing an option for those who do not support a proposal to “stand aside” rather than block. Requiring two or more people to block for a proposal to be put aside. Requiring the blocking party to supply an alternative proposal or a process for generating one. Limiting each person’s option to block consensus to a handful of times in one’s life.

Dissent options When a participant does not support a proposal, he does not necessarily need to block it. When a call for consensus on a motion is made, a dissenting delegate has one of three options: •

•

•

Declare reservations: Group members who are willing to let a motion pass but desire to register their concerns with the group may choose "declare reservations." If there are significant reservations about a motion, the decision-making body may choose to modify or re-word the proposal. Stand aside: A "stand aside" may be registered by a group member who has a "serious personal disagreement" with a proposal, but is willing to let the motion pass. Although stand asides do not halt a motion, it is often regarded as a strong "nay vote" and the concerns of group members standing aside are usually addressed by modifications to the proposal. Stand asides may also be registered by users who feel they are incapable of adequately understanding or participating in the proposal. Block: Any group member may "block" a proposal. In most models, a single block is sufficient to stop a proposal, although some measures of consensus may require more than one block. Blocks are generally considered to be an extreme measure, only used when a member feels a proposal "endanger[s] the organization

or its participants, or violate[s] the mission of the organization" (i.e., a principled objection). In some consensus models, a group member opposing a proposal must work with its proponents to find a solution that will work for everyone.

Agreement vs. consent Unanimity is achieved when the full group consents to a decision. Giving consent does not necessarily mean that the proposal being considered is one’s first choice. Group members can vote their consent to a proposal because they choose to cooperate with the direction of the group, rather than insist on their personal preference. Sometimes the vote on a proposal is framed, “Is this proposal something you can live with?” This relaxed threshold for a yes vote can help make unanimity more easily achievable. Another method to achieve unanimity is by using a special kind of voting process under which all members of the group have a strategic incentive to agree rather than block.

Process There are multiple stepwise models of how to make decisions by consensus. They vary in the amount of detail the steps describe. They also vary depending on how decisions are finalized. The basic model involves • • •

collaboratively generating a proposal, identifying unsatisfied concerns, and then modifying the proposal to generate as much agreement as possible.

After a concerted attempt at generating full agreement, the group can then apply its final decision rule to determine if the existing level of agreement is sufficient to finalize a decision.

Consensus decision-making with consensus blocking

Flowchart of basic consensus decision-making process Groups that require unanimity commonly use a core set of procedures depicted in this flow chart. Once an agenda for discussion has been set and, optionally, the ground rules for the meeting have been agreed upon, each item of the agenda is addressed in turn. Typically, each decision arising from an agenda item follows through a simple structure: •

• •

•

•

Discussion of the item: The item is discussed with the goal of identifying opinions and information on the topic at hand. The general direction of the group and potential proposals for action are often identified during the discussion. Formation of a proposal: Based on the discussion a formal decision proposal on the issue is presented to the group. Call for consensus: The facilitator of the decision-making body calls for consensus on the proposal. Each member of the group usually must actively state their agreement with the proposal, often by using a hand gesture or raising a colored card, to avoid the group interpreting silence or inaction as agreement. Identification and addressing of concerns: If consensus is not achieved, each dissenter presents his or her concerns on the proposal, potentially starting another round of discussion to address or clarify the concern. Modification of the proposal: The proposal is amended, re-phrased or ridered in an attempt to address the concerns of the decision-makers. The process then

returns to the call for consensus and the cycle is repeated until a satisfactory decision is made.

Criticisms Criticism of consensus blocking Critics of consensus blocking often observe that the option, while potentially effective for small groups of motivated or trained individuals with a sufficiently high degree of affinity, has a number of possible shortcomings, notably •

•

Preservation of the Status quo: In decision-making bodies that use formal consensus, the ability of individuals or small minorities to block agreement gives an enormous advantage to anyone who supports the existing state of affairs. This can mean that a specific state of affairs can continue to exist in an organization long after a majority of members would like it to change. The incentive to block can however be removed by using a special kind of voting process. Susceptibility to widespread disagreement: Giving the right to block proposals to all group members may result in the group becoming hostage to an inflexible minority or individual. When a popular proposal is blocked the group actually experiences widespread disagreement, the opposite of the consensus process's goal. Furthermore, "opposing such obstructive behavior [can be] construed as an attack on freedom of speech and in turn [harden] resolve on the part of the individual to defend his or her position." As a result, consensus decision-making has the potential to reward the least accommodating group members while punishing the most accommodating.

Criticism of consensus decision-making •

•

Abilene paradox: Consensus decision-making is susceptible to all forms of groupthink, the most dramatic being the Abilene paradox. In the Abilene paradox, a group can unanimously agree on a course of action that no individual member of the group desires because no one individual is willing to go against the perceived will of the decision-making body. Time Consuming: Since consensus decision-making focuses on discussion and seeks the input of all participants, it can be a time-consuming process. This is a potential liability in situations where decisions need to be made speedily or where it is not possible to canvass the opinions of all delegates in a reasonable period of time. Additionally, the time commitment required to engage in the consensus decision-making process can sometimes act as a barrier to participation for individuals unable or unwilling to make the commitment. However, once a decision has been reached it can be acted on more quickly than a decision handed down. American businessmen complained that in negotiations with a Japanese company, they had to discuss the idea with everyone even the janitor, yet once a decision was made the Americans found the Japanese were able to act much

quicker because everyone was on board, while the Americans had to struggle with internal opposition.

Criticism of majority voting processes Proponents of consensus decision-making view procedures that use majority rule as undesirable for several reasons. Majority voting is regarded as competitive, rather than cooperative, framing decision-making in a win/lose dichotomy that ignores the possibility of compromise or other mutually beneficial solutions. Carlos Santiago Nino, on the other hand, has argued that majority rule leads to better deliberation practice than the alternatives, because it requires each member of the group to make arguments that appeal to at least half the participants. A. Lijphart reaches the same conclusion about majority rule, noting that majority rule encourages coalition-building. Additionally, proponents of consensus argue that majority rule can lead to a 'tyranny of the majority'. Voting theorists argue that majority rule may actually prevent tyranny of the majority, in part because it maximizes the potential for a minority to form a coalition that can overturn an unsatisfactory decision. Advocates of consensus would assert that a majority decision reduces the commitment of each individual decision-maker to the decision. Members of a minority position may feel less commitment to a majority decision, and even majority voters who may have taken their positions along party or bloc lines may have a sense of reduced responsibility for the ultimate decision. The result of this reduced commitment, according to many consensus proponents, is potentially less willingness to defend or act upon the decision.

Roles The consensus decision-making process often has several roles which are designed to make the process run more effectively. Although the name and nature of these roles varies from group to group, the most common are the facilitator, a timekeeper, an empath and a secretary or notes taker. Not all decision-making bodies use all of these roles, although the facilitator position is almost always filled, and some groups use supplementary roles, such as a Devil's advocate or greeter. Some decision-making bodies opt to rotate these roles through the group members in order to build the experience and skills of the participants, and prevent any perceived concentration of power. The common roles in a consensus meeting are: •

Facilitator: As the name implies, the role of the facilitator is to help make the process of reaching a consensus decision easier. Facilitators accept responsibility for moving through the agenda on time; ensuring the group adheres to the mutually agreed-upon mechanics of the consensus process; and, if necessary, suggesting alternate or additional discussion or decision-making techniques, such as go-arounds, break-out groups or role-playing. Some consensus groups use two co-facilitators. Shared facilitation is often adopted to diffuse the perceived power

•

•

•

of the facilitator and create a system whereby a co-facilitator can pass off facilitation duties if he or she becomes more personally engaged in a debate. Timekeeper: The purpose of the timekeeper is to ensure the decision-making body keeps to the schedule set in the agenda. Effective timekeepers use a variety of techniques to ensure the meeting runs on time including: giving frequent time updates, ample warning of short time, and keeping individual speakers from taking an excessive amount of time. Empath or 'Vibe Watch': The empath, or 'vibe watch' as the position is sometimes called, is charged with monitoring the 'emotional climate' of the meeting, taking note of the body language and other non-verbal cues of the participants. Defusing potential emotional conflicts, maintaining a climate free of intimidation and being aware of potentially destructive power dynamics, such as sexism or racism within the decision-making body, are the primary responsibilities of the empath. Note taker: The role of the notes taker or secretary is to document the decisions, discussion and action points of the decision-making body.

Near-unanimous consensus Healthy consensus decision-making processes usually encourage and out dissent early, maximizing the chance of accommodating the views of all minorities. Since unanimity may be difficult to achieve, especially in large groups, or unanimity may be the result of coercion, fear, undue persuasive power or eloquence, inability to comprehend alternatives, or plain impatience with the process of debate, consensus decision making bodies may use an alternative benchmark of consensus. These include the following: •

•

•

Unanimity minus one (or U-1), requires all delegates but one to support the decision. The individual dissenter cannot block the decision although he or she may be able to prolong debate (e.g. via a filibuster). The dissenter may be the ongoing monitor of the implications of the decision, and their opinion of the outcome of the decision may be solicited at some future time. Betting markets in particular rely on the input of such lone dissenters. A lone bettor against the odds profits when his or her prediction of the outcomes proves to be better than that of the majority. This disciplines the market's odds. Unanimity minus two (or U-2), does not permit two individual delegates to block a decision and tends to curtail debate with a lone dissenter more quickly. Dissenting pairs can present alternate views of what is wrong with the decision under consideration. Pairs of delegates can be empowered to find the common ground that will enable them to convince a third, decision-blocking, decisionmaker to join them. If the pair are unable to convince a third party to join them, typically within a set time, their arguments are deemed to be unconvincing. Unanimity minus three, (or U-3), and other such systems recognize the ability of four or more delegates to actively block a decision. U-3 and lesser degrees of unanimity are usually lumped in with statistical measures of agreement, such as: 80%, mean plus one sigma, two-thirds, or majority levels of agreement. Such measures usually do not fit within the definition of consensus.

•

Rough Consensus is a process with no specific rule for "how much is enough." Rather, the question of consensus is left to the judgment of the group chair (an example is the IETF working group, discussed below). While this makes it more difficult for a small number of disruptors to block a decision, it puts increased responsibility on the chair, and may lead to divisive debates about whether rough consensus has in fact been correctly identified.

Historical examples Perhaps the oldest example of consensus decision-making is the Iroquois Confederacy Grand Council, or Haudenosaunee, who have traditionally used consensus in decisionmaking using a 75% super majority to finalize decisions, potentially as early as 1142. Examples of consensus decision-making can likely be found among many indigenous peoples, such as the African Bushmen. Although the modern popularity of consensus decision-making in Western society dates from the women's liberation movement and anti-nuclear movement of the 1970s, the origins of formal consensus can be traced significantly farther back. The most notable of early Western consensus practitioners are the Religious Society of Friends, or Quakers, who adopted the technique as early as the 17th century. The Anabaptists, or Mennonites, too, have a history of using consensus decision-making and some believe Anabaptists practiced consensus as early as the Martyrs' Synod of 1527. Some Christians trace consensus decision-making back to the Bible. The Global Anabaptist Mennonite Encyclopedia references, in particular, Acts 15 as an example of consensus in the New Testament.

Specific models Quaker model Quaker-based consensus is effective because it puts in place a simple, time-tested structure that moves a group towards unity. The Quaker model has been employed in a variety of secular settings. The process allows for individual voices to be heard while providing a mechanism for dealing with disagreements. The following aspects of the Quaker model can be effectively applied in any consensus decision-making process, and is an adaptation prepared by Earlham College: • • • • •

Multiple concerns and information are shared until the sense of the group is clear. Discussion involves active listening and sharing information. Norms limit number of times one asks to speak to ensure that each speaker is fully heard. Ideas and solutions belong to the group; no names are recorded. Differences are resolved by discussion. The facilitator ("clerk" or "convenor" in the Quaker model) identifies areas of agreement and names disagreements to push discussion deeper.

• • • •

The facilitator articulates the sense of the discussion, asks if there are other concerns, and proposes a "minute" of the decision. The group as a whole is responsible for the decision and the decision belongs to the group. The facilitator can discern if one who is not uniting with the decision is acting without concern for the group or in selfish interest. Dissenters' perspectives are embraced.

Key components of Quaker-based consensus include a belief in a common humanity and the ability to decide together. The goal is "unity, not unanimity." Ensuring that group members speak only once until others are heard encourages a diversity of thought. The facilitator is understood as serving the group rather than acting as person-in-charge. In the Quaker model, as with other consensus decision-making processes, by articulating the emerging consensus, members can be clear on the decision, and, as their views have been taken into account, will be likely to support it. Computer standards committees have used a simplified form of the Quaker model by using what is called a Quaker poll.

Japan Japanese companies normally use consensus decision making, meaning that everyone in the company is consulted on each decision. A ringi-sho is a circulation document used to obtain agreement. It must first be signed by the lowest level manager, and then upwards, and may need to be revised and the process started over.

IETF rough consensus model In the Internet Engineering Task Force (IETF), decisions are assumed to be taken by "rough consensus". The IETF has studiously refrained from defining a mechanical method for verifying such consensus, apparently in the belief that any such codification will lead to attempts to "game the system." Instead, a working group (WG) chair or BoF chair is supposed to articulate the "sense of the group." One tradition in support of rough consensus is the tradition of humming rather than (countable) hand-raising; this allows a group to quickly tell the difference between "one or two objectors" or a "sharply divided community", without making it easy to slip into "majority rule". Much of the business of the IETF is carried out on mailing lists, where all parties can speak their view at all times.

Other modern examples The ISO process for adopting new standards is called consensus-based decision making, even though in practice, it is a complex voting process with significant supermajorities needed for agreement.

Overlaps with deliberative methods Consensus decision-making models overlap significantly with deliberative methods, which is the name academics such as political scientists use to describe consensus models.

Tools and methods Colored cards Some consensus decision-making bodies use a system of colored cards to speed up and ease the consensus process. Most often, each member is given a set of three colored cards: red, yellow and green. The cards can be raised during the process to indicate the member's input. Cards can be used during the discussion phase as well as during a call for consensus. The cards have different meanings depending on the phase in which they are used. The meaning of the colors are: •

•

•

Red: During discussion, a red card is used to indicate a point of process or a breach of the agreed upon procedures. Identifying offtopic discussions, speakers going over allowed time limits or other breaks in the process are uses for the red card. During a call for consensus, the red card indicates the member's opposition (usually a "principled objection") to the proposal at hand. When a member, or members, use a red card, it becomes their responsibility to work with the proposing committee to come up with a solution that will work for everyone. Yellow: In the discussion phase, the yellow card is used to indicate a member's ability to clarify a point being discussed or answer a question being posed. Yellow is used during a call for consensus to register a stand aside to the proposal or to formally state any reservations. Green: A group member can use a green card during discussion to be added to the speakers list. During a call for consensus, the green card indicates consent.

Some decision-making bodies use a modified version of the colored card system with additional colors, such as orange to indicate a non-blocking reservation stronger than a stand-aside.

Hand signals Hand signals are often used by consensus decision-making bodies as a way for group members to nonverbally indicate their opinions or positions. Although the nature and meaning of individual gestures varies from group to group, there is a widely-adopted core

set of hand signals. These include: wiggling of the fingers on both hands, a gesture sometimes referred to as "twinkling", to indicate agreement; raising a fist or crossing both forearms with hands in fists to indicate a block or strong disagreement; and making a "T" shape with both hands, the "time out" gesture, to call attention to a point of process or order. One common set of hand signals is called the "Fist-to-Five" or "Fist-of-Five". In this method each member of the group can hold up a fist to indicate blocking consensus, one finger to suggest changes, two fingers to discuss minor issues, three fingers to indicate willingness to let issue pass without further discussion, four fingers to affirm the decision as a good idea, and five fingers to volunteer to take a lead in implementing the decision. Another common set of hand signals used is the "Thumbs" method, where Thumbs Up = agreement; Thumbs Sideways = have concerns but won't block consensus; and Thumbs Down = I don't agree and I won't accept this proposal. This method is also useful for "straw polls" to take a quick reading of the group's overall sentiment for the active proposal.

Dotmocracy sheets

Completed Dotmocracy sheet

Dotmocracy sheets are designed to compliment a consensus decision-making process by providing a simple way to visibly document levels of agreement among participants on a large variety of ideas. Participants write down ideas on paper forms called Dotmocracy sheets and fill in one dot per sheet to record their opinion of each idea on a scale of “strong agreement”, “agreement”, “neutral”, “disagreement”, “strong disagreement” or “confusion”. Participants sign each sheet they dot and may add brief comments. The result is a graphlike visual representation of the group's collective opinions on each idea. The Step-by-Step Process and Rules defined in the Dotmocracy Handbook reinforce consensus decision-making by promoting equal opportunity, open discussion, the drafting of many proposals, the identification of concerns and the encouragement of idea modification.

Fall-back methods Sometimes some common form of voting such as First-past-the-post is used as a fall-back method when consensus cannot be reached within a given time frame. However, if the potential outcome of the fall-back method can be anticipated, then those who support that outcome have incentives to block consensus so that the fall-back method gets applied. Special fall-back methods have been developed that reduce this incentive.

The idea of consensus in the abstract Here we, focuses strictly on the idea of consensus in the abstract, not on the implications of consensus for politics or economics, where follow-up action is required.

Consensus as collective thought A close equivalent phrase might be the "collective agreement" of a group, keeping in mind that a high degree of variation is still possible among individuals, and certainly if there must be individual commitment to follow up the decision with action, this variation remains important. There is considerable debate and research into both collective intelligence and consensus decision-making. Consensus usually involves collaboration, rather than compromise. Instead of one opinion being adopted by a plurality, stakeholders are brought together (often with facilitation) until a convergent decision is developed. If this is done in a purely mechanical way it can result in simple trading—we'll sacrifice this if you'll sacrifice that. Genuine consensus typically requires more focus on developing the relationships among stakeholders, so that they work together to achieve agreements based on willing consent.

Abstract models of consensus The most common and most successful model of consensus is called the prisoner's dilemma. An introduction and discussion of this concept can be found in any contemporary introduction to political science. This approach might be called "algebraic" as opposed to analytic, within mathematics, because it represents an agent by a symbol and then examines the algebraic properties of that symbol. For example, the question, "Can two agents be combined to make a new agent?" sounds like an algebraic question. (More formally, "is the operation of consensus closed in the domain of agents? Is there a larger domain of "abstract agents" in which this operation is closed?") In a more analytic style, we might naively start by envisioning the distribution of opinions in a population as a Gaussian distribution in one parameter. We would then say that the initial step in a consensus process would be the written or spoken synthesis that represents the range of opinions within perhaps three standard deviations of the mean opinion. Other standards are possible, e.g. two standard deviations, or one, or a unanimity minus a certain tolerable number of dissenters. The following steps then operate both to check understanding of the different opinions (parameter values), and then to find new parameters in the multi-dimensional parameter space of all possible decisions, through which the consensus failure in one-dimensional parameter space can be replaced by a solution in multi-dimensional parameter space. An alternative, qualitative, mathematical description is to say that there is an iterative process through (m+n)-dimensional parameter space, starting from initial guesses at a solution in (m)-dimensional parameter space, which tries to converge to find a common solution in (m+n)-dimensional parameter space. A criticism of such modeling is that the opinions or agreements are only theoretical, and that the strength or degree of conviction as measured is not closely correlated to the willingness of any given individual to take action. In direct action politics, the consensus is constantly tested by asking those who agree to immediately place their own bodies 'on the line' and in harm's way, to actually demonstrate that they are committed to a consensus. The ecology movement, peace movement, and labor movement have historically required such demonstrations of commitment. Some have disdained any attempt at formal models or methods, but others have prepared extensive documentation on both formal and informal consensus decision-making processes. Typically, the usefulness of formal models of consensus is confined to cases where follow up action is closely and centrally controlled, e.g. in a military hierarchy or a set of similar computer programs executing on hardware that it completely controls. The idea of consensus itself is probably quite different when considering action by a group of independent human agents, or considering action by those taking orders and committed to executing them all without question, or suffering great harm or exile for any disobedience.

Consensus upon a particular formal model of consensus can lead to groupthink, by making it harder for those who reject that formal model (and using informal or different models) to be heard. This recursion suggests the extreme complexity of reasoning about consensus in a political context. An example is the peace movement's objection to the game theory logic of mutual assured destruction during the Cold War. Peace activists, objecting to military goals and spending found the formal models of the military to be major obstacles. As they had not mastered game theory models they simply were not heard.

In democracy As this example suggests, the concept of consensus is a particularly important one in the context of society and government, and forms a cornerstone of the concept of democracy. Democracy, in its most essential form, direct democracy, has been criticized by a significant number of scholars since the time of Plato as well as adherents to strict republican principles, and is sometimes referred to as the "tyranny of the majority", with the implication that one faction of the society is dominating other factions, possibly repressively. Others, however, argue that if the democracy adheres to principles of consensus, becoming a deliberative democracy, then party or factional dominance can be minimized and decisions will be more representative of the entire society. This too is discussed in depth in consensus decision-making, with many actual examples of the tradeoffs and different tests for consensus used in actual societies and polities. A major cornerstone of the Westminster System is Cabinet Government. All Cabinet decisions are consensual collective and inclusive, a vote is never taken in a Cabinet meeting. All ministers, whether senior and in the Cabinet, or junior ministers, must support the policy of the government publicly regardless of any private reservations. If a minister does not agree with a decision, he or she may resign from the government; as did several British ministers over the 2003 Invasion of Iraq. This means that in the Westminster system of government the cabinet always collectively decides all decisions and all ministers are responsible for arguing in favour of any decision made by the cabinet.

Examples within computing Within the Internet Engineering Task Force (IETF), the concept of "rough consensus and running code" is the basis for the standardization process. It has proven extremely effective for standardizing protocols for inter-computer communication, particularly during its early years. In computer science, consensus is a distributed computing problem in which a group of nodes must reach agreement on a single value. Achieving consensus is a challenging problem in distributed systems, particularly as the number of nodes grows or the reliability of links between nodes decreases.

"Consensus" may also refer to the Consensus theorems in Boolean algebra.

Examples of non-consensus The peer review process in most scientific journals does not use a consensus based process. Referees submit their opinions individually and there is not a strong effort to reach a group opinion.

Chapter- 4

Decentralization

Decentralization or Decentralisation is the process of dispersing decision-making governance closer to the people and/or citizen. It includes the dispersal of administration or governance in sectors or areas like engineering, management science, political science, political economy, sociology and economics. Decentralization is also possible in the dispersal of population and employment. Law, science and technological advancements lead to highly decentralized human endeavours. "While frequently left undefined (Pollitt, 2005), decentralization has also been assigned many different meanings (Reichard & Borgonovi, 2007), varying across countries (Steffensen & Trollegaard, 2000; Pollitt, 2005), languages (Ouedraogo, 2003), general contexts (Conyers, 1984), fields of research, and specific scholars and studies." (Dubois and Fattore 2009) A central theme in decentralization is the difference between a hierarchy, based on: • •

authority: two players in an unequal-power relationship; and an interface: a lateral relationship between two players of roughly equal power.

The more decentralized a system is, the more it relies on lateral relationships, and the less it can rely on command or force. In most branches of engineering and economics, decentralization is narrowly defined as the study of markets and interfaces between parts of a system. This is most highly developed as general systems theory and neoclassical political economy.

Organizational Theory Decentralization also called departmentalization is the policy of delegating decisionmaking authority down to the lower levels in an organization, relatively away from and lower in a central authority. A decentralized organization shows fewer tiers in the organizational structure, wider span of control, and a bottom-to-top flow of decisionmaking and flow of ideas.

In a centralized organization, the decisions are made by top executives or on the basis of pre-set policies. These decisions or policies are then enforced through several tiers of the organization after gradually broadening the span of control until it reaches the bottom tier. In a more decentralized organization, the top executives delegate much of their decisionmaking authority to lower tiers of the organizational structure. As a correlation, the organization is likely to run on less rigid policies and wider spans of control among each officer of the organization. The wider spans of control also reduces the number of tiers within the organization, giving its structure a flat appearance. One advantage of this structure, if the correct controls are in place, will be the bottom-to-top flow of information, allowing decisions by officials of the organization to be well informed about lower tier operations. For example, if an experienced technician at the lowest tier of an organization knows how to increase the efficiency of the production, the bottom-to-top flow of information can allow this knowledge to pass up to the executive officers..

Political theory Some political theorists believe that there are limits to decentralization as a strategy. They assert that any relaxation of direct control or authority introduces the possibility of dissent or division at critical moments, especially if what is being decentralized is decision-making among human beings. Friedrich Engels famously responded to Bakunin, refuting the argument of total decentralization, or anarchism, by scoffing "how these people propose to run a factory, operate a railway or steer a ship without having in the last resort one deciding will, without single management, they of course do not tell us". However, some anarchists have, in turn, responded to his argument, by explaining that they do support a (very limited) amount of centralization, in the form of freely elected and recallable delegates. More to the point from the majority of anarchist perspectives are the real-world successes of anarchist communities, which for the majority only ended when they were defeated by the overwhelming military might of the State or neighboring States. All in all, we do not know what a truly decentralized society would look like over a long period of time since it has never been permitted to exist, however the Zapatistas of Mexico are proving to be quite resilient. In "On Authority", Engels also wrote of democratic workplaces that "particular questions arise in each room and at every moment concerning the mode of production, distribution of material, etc., which must be settled by decision of a delegate placed at the head of each branch of labour or, if possible, by a majority vote." Modern trade unions and management scientists tend to side strongly with Engels in this debate, and generally agree that decentralization is very closely related to standardisation and subordination, e.g. the standard commodity contracts traded on the commodity markets, in which disputes are resolved all according to a jurisdiction and common regulatory system, within the frame of a larger democratic electoral system which can

restore any imbalances of power, and which generally retains the support of the population for its authority. Notable exceptions among trade unions are the Wobblies, and the strong anarchosyndicalist movement of Spain. However, a strategy of decentralization is not always so obviously political, even if it relies implicitly on authority delegated via a political system. For example, engineering standards are a means by which decentralization of supply inspection and testing can be achieved—a manufacturer adhering to the standard can participate in decentralised systems of bidding, e.g. in a parts market. A building standard, for instance, permits the building trades to train labour and building supply corporations to provide parts, which enables rapid construction of buildings at remote sites. Decentralization of training and inspection, through the standards themselves, and related schedules of standardized testing and random spot inspection, achieves a very high statistical reliability of service, i.e. automobiles which rarely stall, cars which rarely leak, and the like. In most cases, an effective decentralization strategy and correspondingly robust systems of professional education, vocational education, and trade certification are critical to creating a modern industrial base. Such robust systems, and commodity markets to accompany them, are a necessary but not sufficient feature of any developed nation. A major goal of the industrial strategy of any developing nation is to safely decentralise decision-making so that central controls are unnecessary to achieving standards and safety. It seems that a very high degree of social capital is required to achieve trust in such standards and systems, and that ethical codes play some significant roles in building up trust in the professions and in the trades. The consumer product markets, industrial product markets, and service markets that emerge in a mature industrial economy, however, still ultimately rely, like the simpler commodity markets, on complex systems of standardization, regulation, jurisdiction, transport, materials and energy supply. The specification and comparison of these is a major focus of the study of political economy. Political or other decision-making units typically must be large and leveraged enough for economy of scale, but also small enough that centralised authority does not become unaccountable to those performing trades or transactions at its perimeter. Large states, as Benjamin Franklin observed, were prone to becoming tyrannies, while small states, correspondingly, tended to become corrupt. Finding the appropriate size of political states or other decision-making units, determining their optimal relationship to social capital and to infrastructural capital, is a major focus of political science. In management science there are studies of the ideal size of corporations, and some in anthropology and sociology study the ideal size of villages. Dennis Fox, a retired professor of legal studies and psychology, proposed an ideal village size of approximately 150 people in his 1985 paper about the relationship of anarchism to the tragedy of the commons.

All these fields recognize some factors that encourage centralised authority and other factors that encourage decentralised "democracy"—balances between which are the major focus of group dynamics. However, decentralization is not only a feature of human society. It is also a feature of ecology. Another objection or limit to political decentralization, similar in structure to that of Engels, is that terrestrial ecoregions impose a certain fiat by their natural watercirculation, soil, and plant and animal biodiversity which constitutes a form of (what the United Nations calls) "natural capital". Since these natural living systems can be neither changed nor replaced by man, some argue that an ecoregional democracy which follows their borders strictly is the only form of decentralization of larger political units that will not lead to endless conflict, e.g. gerrymandering, in struggle between social groups.

Decentralization in European history Decentralization and centralization have played major roles in the history of many societies. An excellent example is the gradual political and organizational changes that have occurred in European history. During the rise and fall of the Roman Empire, Europe went through major centralization and decentralization. Although the leaders of the Roman Empire created a European infrastructure, the fall of the Empire left Europe without a strong political system or military protection. Viking and other barbarian attacks further led rich Romans to build up their latifundia, or large estates, in a way that would protect their families and create a self-sufficient living place. This development led to the growth of the manorial system in Europe. This system was greatly decentralized, as the lords of the manor had power to defend and control the small agricultural environment that was their manor. The manors of the early Middle Ages slowly came together as lords took oaths of fealty to other lords in order to have even stronger defense against other manors and barbarian groups. This feudal system was also greatly decentralized, and the kings of weak "countries" held little power over the nobility. Although some view the Roman Catholic Church of the Middle Ages as a centralizing factor, it played a strong role in weakening the power of the secular kings, which gave the nobility more power. As the Middle Ages wore on, corruption in the church, foreign trade, and new political ideas slowly strengthened the secular powers and brought together the decentralized society. This centralization continued through the Renaissance and has been changed and reformed until the present centralized system which is thought to have a balance between central government and decentralized power.

Decentralised governance Decentralization—the transfer of authority and responsibility for public functions from the central government to subordinate or quasi-independent government organizations and/or the private sector—is a complex and multifaceted concept. It embraces a variety of concepts. Different types of decentralization shows different characteristics, policy implications, and conditions for success.

Typologies of decentralization have flourished (Dubois & Fattore 2009). For example, political, administrative, fiscal, and market decentralization are the types of decentralization. Drawing distinctions between these various concepts is useful for highlighting the many dimensions of successful decentralization and the need for coordination among them. Nevertheless, there is clearly overlap in defining these terms and the precise definitions are not as important as the need for a comprehensive approach. Political, administrative, fiscal and market decentralization can also appear in different forms and combinations across countries, within countries and even within sectors.

Political decentralization Political decentralization aims to give citizens or their elected representatives more power in public decision-making. It is often associated with pluralistic politics and representative government, but it can also support democratization by giving citizens, or their representatives, more influence in the formulation and implementation of policies. Advocates of political decentralization assume that decisions made with greater participation will be better informed and more relevant to diverse interests in society than those made only by national political authorities. The concept implies that the selection of representatives from local electoral constituency allows citizens to know better their political representatives and allows elected officials to know better the needs and desires of their constituents. Political decentralization often requires constitutional or statutory reforms, creation of local political units, and the encouragement of effective public interest groups.

Administrative decentralization Administrative decentralization seeks to redistribute authority, responsibility and financial resources for providing public services among different levels of governance. It is the transfer of responsibility for the planning, financing and management of public functions from the central government or regional governments and its agencies to local governments, semi-autonomous public authorities or corporations, or area-wide, regional or functional authorities. The three major forms of administrative decentralization -deconcentration, delegation, and devolution -- each have different characteristics.

Deconcentration Deconcentration is the weakest form of decentralization and is used most frequently in unitary states-- redistributes decision making authority and financial and management responsibilities among different levels of the national government. It can merely shift responsibilities from central government officials in the capital city to those working in regions, provinces or districts, or it can create strong field administration or local administrative capacity under the supervision of central government ministries.

Delegation Delegation is a more extensive form of decentralization. Through delegation central governments transfer responsibility for decision-making and administration of public functions to semi-autonomous organizations not wholly controlled by the central government, but ultimately accountable to it. Governments delegate responsibilities when they create public enterprises or corporations, housing authorities, transportation authorities, special service districts, semi-autonomous school districts, regional development corporations, or special project implementation units. Usually these organizations have a great deal of discretion in decision-making. They may be exempted from constraints on regular civil service personnel and may be able to charge users directly for services.

Devolution Devolution is an administrative type of decentralisation. When governments devolve functions, they transfer authority for decision-making, finance, and management to quasiautonomous units of local government with corporate status. Devolution usually transfers responsibilities for services to local governments that elect their own elected functionaries and councils, raise their own revenues, and have independent authority to make investment decisions. In a devolved system, local governments have clear and legally recognized geographical boundaries over which they exercise authority and within which they perform public functions. Administrative decentralization always underlies most cases of political decentralization.

Fiscal decentralization Dispersal of financial responsibility is a core component of decentralisation. If local governments and private organizations are to carry out decentralized functions effectively, they must have an adequate level of revenues – either raised locally or transferred from the central government– as well as the authority to make decisions about expenditures. Fiscal decentralization can take many forms, including • • • • •

self-financing or cost recovery through user charges, co-financing or co-production arrangements through which the users participate in providing services and infrastructure through monetary or labor contributions; expansion of local revenues through property or sales taxes, or indirect charges; intergovernmental transfers that shift general revenues from taxes collected by the central government to local governments for general or specific uses; and authorization of municipal borrowing and the mobilization of either national or local government resources through loan guarantees.

In many developing countries local governments or administrative units possess the legal authority to impose taxes, but the tax base is so weak and the dependence on central government subsidies so ingrained that no attempt is made to exercise that authority.

Fiscal decentralization and fiscal federalism The concept of fiscal federalism is not to be associated with fiscal decentralization in officially declared federations only; it is applicable even to non-federal states (having no formal federal constitutional arrangement) in the sense that they encompass different levels of government which have defacto decision making authority (Sharma, 2005a: 44). This however does not mean that all forms of governments are 'fiscally' federal; it only means that 'fiscal federalism' is a set of principles, that can be applied to all countries attempting 'fiscal decentralization'. In fact, fiscal federalism is a general normative framework for assignment of functions to the different levels of government and appropriate fiscal instruments for carrying out these functions (Oates, 1999: 1120-1). The questions arise: (a) How federal and non-federal countries are different with respect to 'fiscal federalism' or 'fiscal decentralization' and (b): How fiscal federalism and fiscal decentralization are related (similar or different)? Chanchal Kumar Sharma (2005a, 2005b) clarifies: While fiscal federalism constitutes a set of guiding principles, a guiding concept, that helps in designing financial relations between the national and subnational levels of the government, fiscal decentralization on the other hand is a process of applying such principles (Sharma,2005b: 178). Federal and non-federal countries differ in the manner in which such principles are applied. Application differs because unitary and federal governments differ in their political & legislative context and thus provide different opportunities for fiscal decentralization (Sharma, 2005a:44).

Fiscal federalism: the federal approach to governance In common parlance political and constitutional aspects (eg giving citizens or their elected representatives more power in political decision-making, establishment of subnational political entities for decision making and making them politically accountable to local electorate which often entails constitutional or statutory reforms like providing for representation of the member states, the strengthening of legislatures, creation of local political units along with the encouragement of effective public interest groups and pluralistic political parties) are considered crucial for federalism. Chanchal Kumar Sharma (2005b) however argues that it is the fiscal side of the federalism (fiscal federalism) that is crucial for federal dynamism. This is because Federalism is not a fixed allocation of spheres of central and provincial autonomy (as assumed in federal finance models) or a particular set of distribution of authority between governments, it is a process, structured by a set of institutions, through which authority is distributed and redistributed. A Federalised System is a “balanced approach between the contrasting forces of centralisation and decentralisation for combining the political and economic advantages of unity while preserving the valued identity of the sub national units" (Sharma, 2005). Fiscal federal principles guide how boundaries, assignments, the level and nature of transfers should be revised from time to time to ensure efficiency and perhaps equity. Thus fiscal federalism provides the tools for "application of the federal approach to governance which lies in its ability to balance the contrasting forces of centralization and decentralization" (Sharma, 2005b: 177). In the age of Globalization, when fiscal

decentralization is in vogue, all countries (federal or not) are applying what may be called, in Sharma's (2005b) words "the federal approach to governance”. The only difference is that in federal countries the subnational governments may be involved in decision making process through some appropriate political or constitutional forum while Central government may dominate quite heavily in a unitary country. Its no surprise then argues Sharma (2005b:177; 2008) that fiscal federalism literature is far away from Centralization Vs Decentralization focus. Final aim is not to decentralize just for sake of it but to ensure good governance. Thus, in fiscal federalism -states Sharma (2008)"decentralization is not seen as an alternative to centralization. Both are needed. The complementary roles of national and subnational actors are determined by analyzing the most effective ways and means of achieving a desired objective"

Economic decentralization Privatization and deregulation shift responsibility for functions from the public to the private sector and is another type of decentralization. Privatization and deregulation are usually, but not always, accompanied by economic liberalization and market development policies. They allow functions that had been primarily or exclusively the responsibility of government to be carried out by businesses, community groups, cooperatives, private voluntary associations, and other non-government organizations.

Privatization Privatization can range in scope from leaving the provision of goods and services entirely to the free operation of the market to "public-private partnerships" in which government and the private sector cooperate to provide services or infrastructure. Privatization can include: • •

•

•

allowing private enterprises to perform functions that had previously been monopolized by government; contracting out the provision or management of public services or facilities to commercial enterprises indeed, there is a wide range of possible ways in which function can be organized and many examples of within public sector and publicprivate institutional forms, particularly in infrastructure; financing public sector programs through the capital market (with adequate regulation or measures to prevent situations where the central government bears the risk for this borrowing) and allowing private organizations to participate; and transferring responsibility for providing services from the public to the private sector through the divestiture of state-owned enterprises.

Privatization cannot in the real sense be considered equivalent to decentralisation.

Deregulation Deregulation reduces the legal constraints on private participation in service provision or allows competition among private suppliers for services that in the past had been

provided by the government or by regulated monopolies. In recent years privatization and deregulation have become more attractive alternatives to governments in developing countries. Local governments are also privatizing by contracting out service provision or administration.

Silent Decentralization An often ignored dimension of decentralization is whether it emerged explicitly by policies, or not. Decentralization in the absence of reforms is also referred to as “silent decentralization.” Consequently, it distinguishes itself mainly by its potential origins: network changes, initiative shifts, policy emphasis developments, or resource availability alterations. (Dubois and Fattore 2009)

Measuring Decentralization While diversity in degree of decentralization across the world is a fact yet there is no consensus in the empirical literature over the questions like ‘which country is more decentralized?’ This is because decentralization is defined and measured differently in different studies (Sharma, 2006). Chanchal Kumar Sharma (2006: 54) finds in his literature survey: "On the basis of ‘decentralization instrument’ there are two strands in the literature that argue for two different approaches to measure fiscal autonomy. One gives more weightage to devolution of tax authority as an instrument of decentralization and hold it crucial for subnational autonomy, the other gives more weight to the nature of intergovernmental transfers (discretionary or not) as an instrument impacting upon the subnational behaviour and effecting their autonomy and accountability. Thus former choose to focus on fiscal policy i.e., the relationship between expenditures and allocated revenues (vertical imbalance) while latter pay attention to regulatory or financial mechanisms i.e. the nature of intergovernmental transfers". Out of these two approaches, observes Sharma (2006), "when it comes to the measurement of fiscal decentralization ‘the share of subnational expenditures and revenues’ is considered the best indicator. This is because fiscal instruments are easier to measure while regulatory and financial instruments are extremely complex and difficult to measure statistically because nowhere transfers remain strictly confined to the technical objectives. Transfers pursue a mix of objectives and politically motivated transfers remain key part of the intergovernmental relations across the globe" (Sharma, 2006: 54). Arjan H. Schakel (2008) notes that various experts such as Akai and Sakata 2002; Breuss and Eller 2004; Ebel and Yilmaz 2002; Fisman and Gatti 2002; Panizza 1999; Sharma 2006, have found the fiscal indicators on the expenditure side to be quite problematic for capturing decision-making decentralization. This is because argues Schakel (2008) "it is difficult to tell whether the expenditure is coming from conditional or unconditional

grants, whether the central government is determining how the money should be spent, whether it is setting the framework legislation within which subnational governments implement, or whether −indeed− subnational governments are spending the money autonomously". Chanchal Kumar Sharma (2006:49) states, "...a true assessment of the degree of decentralization in a country can be made only if a comprehensive approach is adopted and rather than trying to simplify the syndrome of characteristics into the single dimension of autonomy, interrelationships of various dimensions of decentralization are taken into account."

Chapter- 5

Organizational Psychology

Positive Behavior Support Positive behavior support strives to use a system to understand what maintains an individual’s challenging behavior. Students’ inappropriate behaviors are difficult to change because they are functional; they serve a purpose for the child. These behaviors are supported by reinforcement in the environment. Functional assessment clearly describes a behavior; identifies the contexts (events, times, and situation) that predict when behavior will and will not occur, and identifies consequences that maintain the behavior. It also summarizes and creates a hypothesis about the behavior, and directly observes the behavior and takes data to get a baseline. The positive behavior support process involves goal identification, information gathering, hypothesis development, support plan design, implementation and monitoring. The criteria for treatment methods that work include: feasibility, desirability, and effectiveness. Treatment strategies are needed that teachers and parents are able and willing to use and that make an impact on the child’s ability to participate in community and school activities. Positive behavior support has increasingly been recognized as a strategy that meets these criteria. By changing stimulus and reinforcement in the environment and teaching the child in their deficit skill set areas the student's behavior changes in ways that allow him/her to be included in the general education setting. The three areas of deficit skills identified were communication skills, social skills, and self management skills. Re-directive therapy as positive behavior support is especially effective in the parent child relationship. Where other treatment plans have failed redirective therapy allows for a positive interaction between parents and children. Positive behavior support is successful in the school setting because it is primarily a teaching method (Swartz, 1999).

PBS in Schools Schools are required to conduct FBA and use positive behavior support with students who are identified as disabled and are at risk for expulsion, alternative school placement, or more than 10 days of suspension. Even though FBA is required under limited circumstances it is good professional practice to use a problem solving approach to managing problem behaviors in the school setting (Crone & Horner 2003).

The use of Positive Behavior Intervention Supports (PBIS) in schools is widespread (Sugai & Horner, 2002). The program offers a primary, secondary, and tertiary level of intervention. A basic tenet of the PBIS approach includes identifying students in one of three categories based on risk for behavior problems. Once identified, students receive services in one of three categories: primary, secondary, or tertiary. To help practitioners with differences in interventions used at each of the levels the professional literature refers to a three-tiered (levels) model (Stewart, Martella, Marchand-Martella, & Benner, 2005; Sugai, Sprague, Horner & Walker, 2000; Tobin & Sugai, 2005; Walker et al., 1996). Interventions are specifically developed for each of these levels with the goal of reducing the risk for academic or social failure. These interventions may be both behavioral and or academic interventions incorporating scientifically proven forms of instruction such as direct instruction. The interventions become more focused and complex as one examines the strategies used at each level. Primary prevention strategies focus on interventions used on a school-wide basis for all students (Sugai & Horner, 2002). This level of prevention is considered “primary” because all students are exposed in the same way, and at the same level, to the intervention. The primary prevention level is the largest by number. Approximately 80% to 85% of students who are not at risk for behavior problems respond in a positive manner to this prevention level. Primary prevention strategies include, but are not in limited to, using effective teaching practices and curricula, explicitly teaching behavior that is acceptable within the school environment, focusing on ecological arrangement and systems within the school, consistent use of precorrection procedures, using active supervision of common areas, and creating reinforcement systems that are used on a school-wide basis (Lewis, Sugai, & Colvin,1998; Martella & Nelson, 2003; Nelson, Crabtree, Marchand-Martella, & Martella,1998; Nelson, Martella, & Marchand-Martella, 2002). Secondary prevention strategies involve students (i.e., 10% to 15% of the school population) who do not respond to the primary prevention strategies and are at risk for academic failure or behavior problems but are not in need of individual supports (Nelson, et al., 2002). Interventions at the secondary level often are delivered in small groups to maximize time and effort and should be developed with the unique needs of the students within the group. Examples of these interventions include social support such as social skills training (e.g., explicit instruction in skill deficit areas, friendship clubs, check in/ check out, role playing) or academic support (i.e., use of scientifically-validated intervention programs and tutoring). Additionally, secondary programs could include behavioral support approaches (e.g., simple Functional Behavioral Assessments [FBA], precorrection, self-management training). Even with the heightened support within secondary level interventions, some students (1% to 7%) will need the additional assistance at the tertiary level (Walker et al., 1996). Tertiary prevention programs focus on students who display persistent patterns of disciplinary problems (Nelson, Benner, Reid, Epstein, & Currin, 2002).

Tertiary-level programs are also called intensive or individualized interventions and are the most comprehensive and complex. The interventions within this level are strength based in that the complexity and intensity of the intervention plans directly reflect the complexity and intensity of the behaviors. Students within the tertiary level continue involvement in primary and secondary intervention programs and receive additional support as well. These supports could include use of full FBA, de-escalation training for the student, heightened use of natural supports (e.g., family member, friends of the student), and development of a Behavior Intervention Plan (BIP). Although comprehensive services are important for all students, a critical aspect of the three-tiered model is the identification of students at one of the three levels. One method of identifying students in need of interventions is to analyze office disciplinary referrals (ODR) taken at the school (Irvin et al., 2006). ODRs may be a means of both identifying students risk level for antisocial behavior and school failure (Walker et al., 1996). Researchers have advocated analyzing this naturally occurring data source as a relatively cheap, effective, and ongoing measurement device for PBS programs (Irvin et al., 2006; Putnam, Luiselli, Handler, & Jefferson, 2003; Sprague et al., 2001; Sugai et al., 2000; Tidwell, Flannery, & Lewis-Palmer, 2003; Walker, Cheney, Stage, & Blum, 2005). ODRs have also been shown to be effective in determining where students fall within a three-leveled model (Sugai et al., 2000), developing professional development as well as help coordinating school efforts with other community agencies (Tobin & Sugai, 1997; Tobin, Sugai, & Colvin, 2000), predicting school failure in older grades as well as delinquency (Sprague et al., 2001), indicating types of behavior resulting in referrals (Putnam et al., 2003), and determination of the effectiveness of precorrection techniques (Oswald, Safran, & Johanson, 2005). Analyzing discipline referral data can also help school personnel identify where to improve ecological arrangements within a school and to recognize how to increase active supervision in common areas (Nelson, Martella, & Galand, 1998; Nelson et al., 2002)

Functional Behavioral Assessment Functional behavior assessment (FBA) emerged from applied behavior analysis. It is the first step in individual and cornerstone of a Positive Behavior Support plan. The assessment seeks to describe the behavior and environmental factors and setting events that predict the behavior in order to guide the development of effective support plans. Assessment lays the foundation of PBS. The assessment includes: • a description of the problem behavior and its general setting of occurrence • identification of events, times and situations that predict problem behavior • identification of consequences that maintain behavior • identification of the motivating function of behavior

• collection of direct observational data. Identification of alternative behavior that could replace the child's problem behavior (i.e., what the normal child does). Often this is measured through direct observation or standardized behavioral assessment instruments. In some cases, the problem behavior identified in the functional behavior assessment is further analyzed by conducting a behavior chain analysis- in which the sequences of behavior that build up to the problem behavior become the focus. The results of the assessment help in developing the individualized behavior support plan. This outlines procedures for teaching alternatives to the behavior problems, and redesign of the environment to make the problem behavior irrelevant, inefficient, and ineffective. Another avenue of functional behavior assessment is growing in popularity- it is called Behavior Chain Analysis. In behavior chain analysis, one looks at the progressive changes of behavior as they lead to problem behavior and then attempts to disrupt this sequence. Where as FBA is concerned mostly with Setting-Antecedent-BehaviorConsequence relations, the behavior chain analysis looks at the progression of behavior. Such as first the child may fidget, then he might begin to tease others, then he might start to throw things, and then finally hit another student.

Behavioral strategies available There are many different behavioral strategies that PBS can use to encourage individuals to change their behavior. SOME of these strategies are delivered through the consultation process to teachers. The strong part of functional behavior assessment is that it allows interventions to directly address the function (purpose) of a problem behavior. For example, a child who acts out for attention could receive attention for alternative behavior (contingency management) or the teacher could make an effort to increase the amount of attention throughout the day (satiation). Changes in setting events or antecedents are often preferred by PBS because contingency management often takes more effort. Another tactic especially when dealing with disruptive behavior is to use information from a Behavior chain analysis to disrupts the behavioral problem early in the sequence to prevent disruption. Some of the most commonly used approaches are: • Modifying the environment, antecedents (such as curriculum) to behavior, or routine •Providing an alternative to the undesired behavior (not the same as a reward; it should be an alternative that is readily available to the person. The thought behind this is that the person may, over time, learn to more independently seek out appropriate options rather than the undesired behavior(s).) • Tactical ignoring of the behavior

• Distracting the child • Positive reinforcement for an appropriate behavior • Changing expectations and demands placed upon the child • Teaching the child new skills and behaviors • Modification techniques such as desensitization and graded extinction • Changing how people around the child react • Time out (Child) • Medication.

Behavior management program The main keys to developing a behavior management program include: • Identifying the specific behaviors to address • Establishing the goal for change and the steps required to achieve it • Procedures for recognizing and monitoring changed behavior • Choosing the appropriate behavioral strategies that will be most effective. Through the use of effective behavior management at a school wide level, PBS programs offer an effective method to reduce school crime and violence. To prevent the most severe forms of problems behvior normal social behavior in these programs needs to be actively taught.

Consequential management/ Contingency Management Consequential management is a positive response to challenging behavior. It serves to give the person informed choice and an opportunity to learn. Consequences must be clearly related to the challenging behavior For example, if a glass of water was thrown and the glass smashed, the consequence (restitution) would be for the person to clean up the mess and replace the glass. These sorts of consequences are consistent with normal social reinforcement contingencies. Providing choices is very important and staff can set limits by giving alternatives that are related to a behavior they are seeking. It is important that the alternative is stated in a positive way and that words are used which convey that the person has a choice. For example:

Coercive approach “If you don't cut that out you'll have to leave the room.” Positive approach “You can watch TV quietly or leave the room.”

Happiness at Work Despite a large body of positive psychological research into the relationship between happiness and productivity, happiness at work has traditionally been seen as a potential by-product of positive outcomes at work, rather than a pathway to success in business. However a growing number of scholars, Boehm and Lyubomirsky included, state that it should be viewed as one of the major sources of positive outcomes in the workplace.

Defining Happiness at work Dr Laurel Edmunds and Jessica Pryce-Jones have researched the issue of happiness at work at length and have produced the following definition from their findings:

“

Happiness at work is about mindfully making the best use of the resources you have to overcome the challenges you face. Actively relishing the highs and managing the lows will help you maximize your performance and achieve your potential. And this not only builds your happiness but also that of others-who will be affected and energized by what you do.

”

The use of positive psychology in business has become an increasingly popular and valuable tool with which to manage and develop staff. This then has a flow-on effect for the community that they work in. When these practices are put in place in a community-in this case the business--generally the outcome is a real, direct benefit to the productivity of the business and to a happier and healthier employee as discussed by Rath & Clifton (2005). With the major advances in technology, particularly in a modern office environment, a greater range of information has become easily available at employees’ fingertips. Staff today generally have a much broader knowledge of business environments, and therefore their minimum expectations of what a modern workplace should provide to keep them happy and motivated is fairly high. Very basic programs can be implemented to meet these needs and expectations. As an example, if we achieve target ‘A’, a new filtered coffee machine will be installed to replace the instant coffee in the staff room. These minor rewards can have a large impact on the staff’s happiness and moods--indeed, the frequency of minor positive rewards is critical for success.

One of the main benefits to a business with a well-planned and well-run program is increased productivity through greater output and less down time. Through a successful positive psychology program, staff can develop a deeper satisfaction in their workplace relationships, and therefore the quality of their work tends to improve, as well. A proactive business manager in today’s business world caters to the needs of his or her staff either by ensuring a well-run in-house program or by bringing in experts to facilitate the development of one.

Chapter- 6

Organizational Culture

Organizational culture is an idea in the field of organizational studies and management which describes the psychology, attitudes, experiences, beliefs and values (personal and cultural values) of an organization. It has been defined as "the specific collection of values and norms that are shared by people and groups in an organization and that control the way they interact with each other and with stakeholders outside the organization." This definition continues to explain organizational values, also known as "beliefs and ideas about what kinds of goals members of an organization should pursue and ideas about the appropriate kinds or standards of behavior organizational members should use to achieve these goals. From organizational values develop organizational norms, guidelines, or expectations that prescribe appropriate kinds of behavior by employees in particular situations and control the behavior of organizational members towards one another."

Strong/weak cultures

Training meeting about sustainable design. The photo shows a training meeting with factory workers in a stainless steel ecodesign company from Rio de Janeiro, Brazil. These type of meetings are important in order to establish a strong culture in the corporation Strong culture is said to exist where staff respond to stimulus because of their alignment to organizational values. In such environments, strong cultures help firms operate like well-oiled machines, cruising along with outstanding execution and perhaps minor tweaking of existing procedures here and there. Conversely, there is weak culture where there is little alignment with organizational values and control must be exercised through extensive procedures and bureaucracy. Where culture is strong—people do things because they believe it is the right thing to do—there is a risk of another phenomenon, Groupthink. "Groupthink" was described by Irving L. Janis. He defined it as "...a quick and easy way to refer to a mode of thinking that people engage when they are deeply involved in a cohesive in-group, when members' strive for unanimity override their motivation to realistically appraise alternatives of action." This is a state where people, even if they have different ideas, do not challenge organizational thinking, and therefore there is a reduced capacity for innovative thoughts. This could occur, for example, where there is heavy reliance on a central charismatic figure in the organization, or where there is an evangelical belief in the organization’s values, or also in groups where a friendly climate is at the base of their identity (avoidance of conflict). In fact group think is very common, it happens all the time, in

almost every group. Members that are defiant are often turned down or seen as a negative influence by the rest of the group, because they bring conflict. Innovative organizations need individuals who are prepared to challenge the status quo— be it group-think or bureaucracy, and also need procedures to implement new ideas effectively.

Typologies of organizational cultures Several methods have been used to classify organizational culture. Some are described below: Hofstede (1980) demonstrated that there are national and regional cultural groupings that affect the behavior of organizations. Hofstede looked for national differences between over 100,000 of IBM's employees in different parts of the world, in an attempt to find aspects of culture that might influence business behavior. Hofstede identified five dimensions of culture in his study of national influences: •

• •

•

Power distance - The degree to which a society expects there to be differences in the levels of power. A high score suggests that there is an expectation that some individuals wield larger amounts of power than others. A low score reflects the view that all people should have equal rights. Uncertainty avoidance reflects the extent to which a society accepts uncertainty and risk. Individualism vs. collectivism - individualism is contrasted with collectivism, and refers to the extent to which people are expected to stand up for themselves, or alternatively act predominantly as a member of the group or organization. However, recent researches have shown that high individualism may not necessarily mean low collectivism, and vice versa. Research indicates that the two concepts are actually unrelated. Some people and cultures might have both high individualism and high collectivism, for example. Someone who highly values duty to his or her group does not necessarily give a low priority to personal freedom and self-sufficiency Masculinity vs. femininity - refers to the value placed on traditionally male or female values. Male values for example include competitiveness, assertiveness, ambition, and the accumulation of wealth and material possessions.

Deal and Kennedy Deal and Kennedy defined organizational culture as the way things get done around here.In relation to its feedback this would mean a quick response and also measured organizations in ition, such as oil prospecting or military aviation.

•

The Process Culture occurs in organizations where there is little or no feedback. People become bogged down with how things are done not with what is to be achieved. This is often associated with bureaucracies. While it is easy to criticize these cultures for being overly cautious or bogged down in red tape, they do produce consistent results, which is ideal in, for example, public services.

Charles Handy Charles Handy (1985) popularized the 1972 work of Roger Harrison of looking at culture which some scholars have used to link organizational structure to organizational culture. He describes Harrison's four types thus: •

•

•

•

a Power Culture which concentrates power among a few. Control radiates from the center like a web. Power and influence spread out from a central figure or group. Power desires from the top person and personal relationships with that individual matters more than any formal title of position. Power Cultures have few rules and little bureaucracy; swift decisions can ensue. In a Role Culture, people have clearly delegated authorities within a highly defined structure. Typically, these organizations form hierarchical bureaucracies. Power derives from a person's position and little scope exists for expert power. Controlled by procedures, roles descriptions and authority definitions. Predictable and consistent systems and procedures are highly valued. By contrast, in a Task Culture, teams are formed to solve particular problems. Power derives from expertise as long as a team requires expertise. These cultures often feature the multiple reporting lines of a matrix structure. It is all a small team approach, who are highly skilled and specialist in their own markets of experience. A Person Culture exists where all individuals believe themselves superior to the organization. Survival can become difficult for such organizations, since the concept of an organization suggests that a group of like-minded individuals pursue the organizational goals. Some professional partnerships can operate as person cultures, because each partner brings a particular expertise and clientele to the firm.

Edgar Schein Edgar Schein, an MIT Sloan School of Management professor, defines organizational culture as: "A pattern of shared basic assumptions that was learned by a group as it solved its problems of external adaptation and internal integration, that has worked well enough to be considered valid and, therefore, to be taught to new members as the correct way you perceive, think, and feel in relation to those problems"(Schein, 2004, p. 17). According to Schein, culture is the most difficult organizational attribute to change, outlasting organizational products, services, founders and leadership and all other

physical attributes of the organization. His organizational model illuminates culture from the standpoint of the observer, described by three cognitive levels of organizational culture. At the first and most cursory level of Schein's model is organizational attributes that can be seen, felt and heard by the uninitiated observer - collectively known as artifacts. Included are the facilities, offices, furnishings, visible awards and recognition, the way that its members dress, how each person visibly interacts with each other and with organizational outsiders, and even company slogans, mission statements and other operational creeds. The next level deals with the professed culture of an organization's members - the values. At this level, local and personal values are widely expressed within the organization. Organizational behavior at this level usually can be studied by interviewing the organization's membership and using questionnaires to gather attitudes about organizational membership. At the third and deepest level, the organization's tacit assumptions are found. These are the elements of culture that are unseen and not cognitively identified in everyday interactions between organizational members. Additionally, these are the elements of culture which are often taboo to discuss inside the organization. Many of these 'unspoken rules' exist without the conscious knowledge of the membership. Those with sufficient experience to understand this deepest level of organizational culture usually become acclimatized to its attributes over time, thus reinforcing the invisibility of their existence. Surveys and casual interviews with organizational members cannot draw out these attributes—rather much more in-depth means is required to first identify then understand organizational culture at this level. Notably, culture at this level is the underlying and driving element often missed by organizational behaviorists. Using Schein's model, understanding paradoxical organizational behaviors becomes more apparent. For instance, an organization can profess highly aesthetic and moral standards at the second level of Schein's model while simultaneously displaying curiously opposing behavior at the third and deepest level of culture. Superficially, organizational rewards can imply one organizational norm but at the deepest level imply something completely different. This insight offers an understanding of the difficulty that organizational newcomers have in assimilating organizational culture and why it takes time to become acclimatized. It also explains why organizational change agents usually fail to achieve their goals: underlying tacit cultural norms are generally not understood before would-be change agents begin their actions. Merely understanding culture at the deepest level may be insufficient to institute cultural change because the dynamics of interpersonal relationships (often under threatening conditions) are added to the dynamics of organizational culture while attempts are made to institute desired change.

Arthur F. Carmazzi

The Blame culture This culture cultivates distrust and fear, people blame each other to avoid being reprimanded or put down, this results in no new ideas or personal initiative because people don’t want to risk being wrong. Multi-directional culture This culture cultivates minimized cross-department communication and cooperation. Loyalty is only to specific groups (departments). Each department becomes a clique and is often critical of other departments which in turn creates lots of gossip. The lack of cooperation and Multi-Direction is manifested in the organization's inefficiency. Live and let live culture This culture is Complacency, it manifests Mental Stagnation and Low Creativity. People here have little future vision and have given up their passion. There is average cooperation and communication, and things do work, but they do not grow. People have developed their personal relationships and decided who to stay away from, there is not much left to learn. Brand congruent culture People in this culture believe in the product or service of the organization, they feel good about what their company is trying to achieve and cooperate to achieve it. People here are passionate and seem to have similar goals in the organization. They use personal resources to actively solve problems and while they don’t always accept the actions of management or others around them, they see their job as important. Most everyone in this culture is operating at the level of Group. Leadership enriched culture People view the organization as an extension of themselves, they feel good about what they personally achieve through the organization and have exceptional Cooperation. Individual goals are aligned with the goals of the organization and people will do what it takes to make things happen. As a group, the organization is more like family providing personal fulfillment which often transcends ego so people are consistently bringing out the best in each other. In this culture, Leaders do not develop followers, but develop other leaders. Most everyone in this culture is operating at the level of Organization. Carmazzi's model requires application of his Directive Communication psychology to evolve the culture. While the idea of having a Leadership Enriched organization is inspirational, it would require substantial Leadership resources to develop. The concept of Evolving the culture assumes that "Every Individual in the organization wants to do a good job", and the behaviors that result in poor performance are manifestations of psychology the group or organization has created through policies, leadership and poor communication.

Robert A. Cooke The Organizational Culture Inventory: Culture Clusters Robert A. Cooke, PhD, defines culture as the behaviors that members believe are required to fit in and meet expectations within their organization. The Organizational Culture Inventory measures twelve behavioral of norms that are grouped into three general types of cultures: •Constructive Cultures, in which members are encouraged to interact with people and approach tasks in ways that help them meet their higher-order satisfaction needs. •Passive/Defensive Cultures, in which members believe they must interact with people in ways that will not threaten their own security. •Aggressive/Defensive Cultures, in which members are expected to approach tasks in forceful ways to protect their status and security.

The Constructive Cluster The Constructive Cluster includes cultural norms that reflect expectations for members to interact with others and approach tasks in ways that will help them meet their higher order satisfaction needs for affiliation, esteem, and self-actualization. The four cultural norms in this cluster are: •Achievement •Self-Actualizing •Humanistic-Encouraging •Affiliative Organizations with Constructive cultures encourage members to work to their full potential, resulting in high levels of motivation, satisfaction, teamwork, service quality, and sales growth. Constructive norms are evident in environments where quality is valued over quantity, creativity is valued over conformity, cooperation is believed to lead to better results than competition, and effectiveness is judged at the system level rather than the component level. These types of cultural norms are consistent with (and supportive of) the objectives behind empowerment, total quality management, transformational leadership, continuous improvement, re-engineering, and learning organizations.

The Passive/Defensive Cluster Norms that reflect expectations for members to interact with people in ways that will not threaten their own security are in the Passive/Defensive Cluster. The four Passive/Defensive cultural norms are: •Approval •Conventional •Dependent •Avoidance In organizations with Passive/Defensive cultures, members feel pressured to think and behave in ways that are inconsistent with the way they believe they should in order to be effective. People are expected to please others (particularly superiors) and avoid interpersonal conflict. Rules, procedures, and orders are more important than personal beliefs, ideas, and judgment. Passive/Defensive cultures experience a lot of unresolved conflict and turnover, and organizational members report lower levels of motivation and satisfaction.

The Aggressive/Defensive Cluster The Aggressive/Defensive Cluster includes cultural norms that reflect expectations for members to approach tasks in ways that protect their status and security. The Aggressive/Defensive cultural norms are: •Oppositional •Power •Competitive •Perfectionistic Organizations with Aggressive/Defensive cultures encourage or require members to appear competent, controlled, and superior. Members who seek assistance, admit shortcomings, or concede their position are viewed as incompetent or weak. These organizations emphasize finding errors, weeding out “mistakes,” and encouraging members to compete against each other rather than competitors. The short-term gains associated with these strategies are often at the expense of long-term growth.

Elements G. Johnson described a cultural web, identifying a number of elements that can be used to describe or influence Organizational Culture: • •

• • • • •

The Paradigm: What the organization is about; what it does; its mission; its values. Control Systems: The processes in place to monitor what is going on. Role cultures would have vast rulebooks. There would be more reliance on individualism in a power culture. Organizational Structures: Reporting lines, hierarchies, and the way that work flows through the business. Power Structures: Who makes the decisions, how widely spread is power, and on what is power based? Symbols: These include organizational logos and designs, but also extend to symbols of power such as parking spaces and executive washrooms. Rituals and Routines: Management meetings, board reports and so on may become more habitual than necessary. Stories and Myths: build up about people and events, and convey a message about what is valued within the organization.

These elements may overlap. Power structures may depend on control systems, which may exploit the very rituals that generate stories which may not be true.

Organizational Culture Assessment Instrument Robert Quinn and Kim Cameron researched what makes organizations effective and successful. Based on the Competing Values Framework, they developed the Organizational Culture Assessment Instrument that distinguishes four culture types. Competing values produce polarities like: flexibility versus stability and internal versus external focus. These two polarities were found to be most important in defining organizational success. The polarities construct a quadrant with four types of culture: Clan Culture - internal focus and flexible A friendly workplace where leaders act like father figures. Adhocracy Culture - external focus and flexible A dynamic workplace with leaders that stimulate innovation. Market Culture - external focus and controlled A competitive workplace with leaders like hard drivers Hierarchy Culture - internal focus and controlled A structured and formalized workplace where leaders act like coordinators. Cameron & Quinn found six key aspects that will make up a culture. These can be assessed in the Organizational Culture Assessment Instrument (OCAI) thus producing a mix of these four archetypes of culture. Each organization or team will have its unique mix of culture types. By assessing the current organizational culture as well as the

preferred situation, the gap and direction to change can be made visible. This can be the first step to changing organizational culture.

Organizational culture and change There are a number of methodologies specifically dedicated to organizational culture change such as Peter Senge’s Fifth Discipline and Arthur F Carmazzi's Directive Communication. These are also a variety of psychological approaches that have been developed into a system for specific outcomes such as the Fifth Discipline’s “learning organization” or Directive Communication’s “corporate culture evolution.” Ideas and strategies, on the other hand, seem to vary according to particular influences that affect culture. Burman and Evans (2008) argue that it is 'leadership' that affects culture rather than 'management', and describe the difference. When one wants to change an aspect of the culture of an organization one has to keep in consideration that this is a long term project. Corporate culture is something that is very hard to change and employees need time to get used to the new way of organizing. For companies with a very strong and specific culture it will be even harder to change. Cummings & Worley (2005, p. 491 – 492) give the following six guidelines for cultural change, these changes are in line with the eight distinct stages mentioned by Kotter (1995, p. 2)3: 1. Formulate a clear strategic vision (stage 1,2 & 3 of Kotter, 1995, p. 2) In order to make a cultural change effective a clear vision of the firm’s new strategy, shared values and behaviors is needed. This vision provides the intention and direction for the culture change (Cummings & Worley, 2005, p. 490). 2. Display Top-management commitment (stage 4 of Kotter, 1995, p. 2) It is very important to keep in mind that culture change must be managed from the top of the organization, as willingness to change of the senior management is an important indicator (Cummings & Worley, 2005, page 490). The top of the organization should be very much in favor of the change in order to actually implement the change in the rest of the organization. De Caluwé & Vermaak (2004, p 9) provide a framework with five different ways of thinking about change. 3. Model culture change at the highest level (stage 5 of Kotter, 1995, p. 2) In order to show that the management team is in favor of the change, the change has to be notable at first at this level. The behavior of the management needs to symbolize the kinds of values and behaviors that should be realized in the rest of the company. It is important that the management shows the strengths of the current culture as well, it must

be made clear that the current organizational does not need radical changes, but just a few adjustments. 4. Modify the organization to support organizational change The fourth step is to modify the organization to support organizational change. 5. Select and socialize newcomers and terminate deviants (stage 7 & 8 of Kotter, 1995, p. 2) A way to implement a culture is to connect it to organizational membership, people can be selected and terminate in terms of their fit with the new culture (Cummings & Worley, 2005, p. 491). 6. Develop ethical and legal sensitivity Changes in culture can lead to tensions between organizational and individual interests, which can result in ethical and legal problems for practitioners. This is particularly relevant for changes in employee integrity, control, equitable treatment and job security (Cummings & Worley, 2005, p. 491). Change of culture in the organizations is very important and inevitable. Culture innovations is bound to be because it entails introducing something new and substantially different from what prevails in existing cultures. Cultural innovation is bound to be more difficult than cultural maintenance. People often resist changes hence it is the duty of the management to convince people that likely gain will outweigh the losses. Besides institutionalization, deification is another process that tends to occur in strongly developed organizational cultures. The organization itself may come to be regarded as precious in itself, as a source of pride, and in some sense unique. Organizational members begin to feel a strong bond with it that transcends material returns given by the organization, and they begin to identify with in. The organization turns into a sort of clan.

Entrepreneurial culture Stephen McGuire defined and validated a model of organizational culture that predicts revenue from new sources. An Entrepreneurial Organizational Culture (EOC) is a system of shared values, beliefs and norms of members of an organization, including valuing creativity and tolerance of creative people, believing that innovating and seizing market opportunities are appropriate behaviors to deal with problems of survival and prosperity, environmental uncertainty, and competitors’ threats, and expecting organizational members to behave accordingly.

Elements of Entrepreneurial Culture • •

People and empowerment focused Value creation through innovation and change

• • • • • •

Attention to the basics Hands-on management Doing the right thing Freedom to grow and to fail Commitment and personal responsibility Emphasis on the future

Critical views Writers from Critical management studies have tended to express skepticism about the functionalist and unitarist views of culture put forward by mainstream management thinkers. Whilst not necessarily denying that organizations are cultural phenomena, they would stress the ways in which cultural assumptions can stifle dissent and reproduce management propaganda and ideology. After all, it would be naive to believe that a single culture exists in all organizations, or that cultural engineering will reflect the interests of all stakeholders within an organization. In any case, Parker has suggested that many of the assumptions of those putting forward theories of organizational culture are not new. They reflect a long-standing tension between cultural and structural (or informal and formal) versions of what organizations are. Further, it is perfectly reasonable to suggest that complex organizations might have many cultures, and that such sub-cultures might overlap and contradict each other. The neat typologies of cultural forms found in textbooks rarely acknowledge such complexities, or the various economic contradictions that exist in capitalist organizations. One of the strongest and widely recognized criticisms of theories that attempt to categorize or 'pigeonhole' organizational culture is that put forward by Linda Smircich. She uses the metaphor of a plant root to represent culture, describing that it drives organizations rather than vice versa. Organizations are the product of organizational culture, we are unaware of how it shapes behavior and interaction (also recognized through Scheins (2002) underlying assumptions) and so how can we categorize it and define what it is?

Organizational communication perspective on culture The organizational communication perspective on culture is divided into three areas: • • •

Traditionalism: Views culture through objective things such as stories, rituals, and symbols Interpretivism: Views culture through a network of shared meanings (organization members sharing subjective meanings) Critical-Interpretivism: Views culture through a network of shared meanings as well as the power struggles created by a similar network of competing meanings

There are many different types of communication that contribute in creating an organizational culture:

• • •

•

Metaphors such as comparing an organization to a machine or a family reveal employees’ shared meanings of experiences at the organization. Stories can provide examples for employees of how to or not to act in certain situations. Rites and ceremonies combine stories, metaphors, and symbols into one. Several different kinds of rites that affect organizational culture: o Rites of passage: employees move into new roles o Rites of degradation: employees have power taken away from them o Rites of enhancement: public recognition for an employee’s accomplishments o Rites of renewal: improve existing social structures o Rites of conflict reduction: resolve arguments between certain members or groups o Rites of integration: reawaken feelings of membership in the organization Reflexive comments are explanations, justifications, and criticisms of our own actions. This includes: o Plans: comments about anticipated actions o Commentaries: comments about action in the present o Accounts: comments about an action or event that has already occurred Such comments reveal interpretive meanings held by the speaker as well as the social rules they follow.

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Fantasy Themes are common creative interpretations of events that reflect beliefs, values, and goals of the organization. They lead to rhetorical visions, or views of the organization and its environment held by organization members.

Schema Schemata (plural of schema) are knowledge structures a person forms from past experiences, allowing the person to respond to similar events more efficiently in the future by guiding the processing of information. A person's schemata are created through interaction with others, and thus inherently involve communication. Stanley G. Harris argues that five categories of in-organization schemata are necessary for organizational culture: • • • •

Self-in-organization schemata: a person’s concept of themselves within the context of the organization, including her/his personality, roles, and behavior. Person-in-organization schemata: a person’s memories, impressions. and expectations of other individuals within the organization. Organization schemata: subset of person schemata, a person’s generalized perspective on others as a whole in the organization. Object/concept-in-organization schemata: knowledge an individual has of organization aspects other than of other persons.

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Event-in-organization schemata: a person’s knowledge of social events within an organization.

All of these categories together represent a person’s knowledge of an organization. Organizational culture is created when the schematas (schematic structures) of differing individuals across and within an organization come to resemble each other (when any one person's schemata come to resemble aby other person's schemata because of mutual organizational involvement). This is primarily done through organizational communication, as individuals directly or indirectly share knowledge and meanings.

Mergers, organizational culture, and cultural leadership One of the biggest obstacles in the way of the merging of two organizations is organizational culture. Each organization has its own unique culture and most often, when brought together, these cultures clash. When mergers fail employees point to issues such as identity, communication problems, human resources problems, ego clashes, and inter-group conflicts, which all fall under the category of “cultural differences”. One way to combat such difficulties is through cultural leadership. Organizational leaders must also be cultural leaders and help facilitate the change from the two old cultures into the one new culture. This is done through cultural innovation followed by cultural maintenance. •

•

Cultural innovation includes: o Creating a new culture: recognizing past cultural differences and setting realistic expectations for change o Changing the culture: weakening and replacing the old cultures Cultural maintenance includes: o Integrating the new culture: reconciling the differences between the old cultures and the new one o Embodying the new culture: Establishing, affirming, and keeping the new culture

Corporate culture vs. organizational culture Corporate culture is the total sum of the values, customs, traditions, and meanings that make a company unique. Corporate culture is often called "the character of an organization", since it embodies the vision of the company’s founders. The values of a corporate culture influence the ethical standards within a corporation, as well as managerial behavior. Senior management may try to determine a corporate culture. They may wish to impose corporate values and standards of behavior that specifically reflect the objectives of the organization. In addition, there will also be an extant internal culture within the workforce. Work-groups within the organization have their own behavioral quirks and interactions which, to an extent, affect the whole system. Roger Harrison's four-culture typology, and adapted by Charles Handy, suggests that unlike organizational culture,

corporate culture can be 'imported'. For example, computer technicians will have expertise, language and behaviors gained independently of the organization, but their presence can influence the culture of the organization as a whole. Organizational culture and corporate culture are often used interchangeably but it is a mistake to state that they are different concepts. All corporations are also organizations but not all organizations are corporations. Organizations include religious institutions, not-for-profit groups, and government agencies. There is even the Canadian Criminal Code definition of "organized crime" as meaning "a group comprised of three or more persons which has, as one of its primary activities or purposes, the commission of serious offences which likely results in financial gain." Corporations are organizations and are also legal entities. As Schein (2009), Deal & Kennedy (2000), Kotter (1992) and many others state, organizations often have very differing cultures as well as subcultures.

Organizational Culture Includes Brand culture Brand culture is a company culture in which employees "live" to brand values, to solve problems and make decisions internally, and deliver a branded customer experience externally. It is the desired outcome of an internal branding, internal brand alignment or employee engagement effort that elevates beyond communications and training. A brand in order to be relevant to consumers and sustainable over time must operate much like a culture. A company must develop an ethos and a worldview that it absolutely believes in and then should act in accordance with it. Everything the company does every product or service it offers, every public statement, advertisement, website, internal policy, memo and business decisions it makes must be congruent with that ethos and worldview. If the brand truly represents an ethos and worldview which are attractive to consumers they will embrace the brand as part of their own identity. They will join the brand culture and participate in that culture as a way of expressing to the rest of the world who they are and what they believe in. An Apple iPod stands for a courageous, inventive, rebellious and audacious approach to life that make every iPod user proud and give a badge of identity. It stands for the Apple way of doing things. Harley Davidson has created a rich body of meaning and embodied that meaning in a system of symbols and actions. This is the Harley Davidson brand culture - belief, passion, excitement, commitment etc.

When consumer connects to a brand that aligns with their most deeply held beliefs and sense of identity they are essentially both pulling that brand into their own world and entering the world of that brand. The vital thing for any organization is to create this world for its consumers. The value of brand culture comes out when companies give its consumers something to believe in.

Shadow of the Leader "Shadow of the Leader" is a phrase used to describe a common phenomenon in business organizations where those in positions of leadership and power, through their behavior and actions, tend to influence the behavior and actions of those below them, thus “casting a shadow” across the organization. “Shadow of the Leader” usually refers to the situation where the CEO or President (or anyone else in a position of authority over others), through his likes, dislikes, treatment of subordinates, language and idioms, personal preferences, beliefs and values tends to shape the characteristics, culture and ways of doing business in the organization. It is not so much that leaders force their style and values on others (although this is the case with dictators and bullies), but that employees tend to look upwards for clues as to what is important, how to get ahead in the organization, and how to fit in. It is a natural tendency for people with limited power within organizations to have an “affiliation need” and want to fit in. Those that don't match the culture or don’t get along with the boss's standards and expectations tend to get rejected or leave the firm, often saying; “I just didn’t fit in with their way of doing business!”. The phenomenon of shadow of the leader is somewhat synonymous with such old phrases as: “A fish rots from the head first”, “A chip off the old block”, “The apple never falls far from the tree”, “You’re just like your father (or mother)”, and countless other phrases. While the concept is based on common human behavior in groups and is probably timeless, it was first studied in business organizations and commented on in Larry Senn's doctoral dissertation published 1970. The study was the first systematic study of the concept of corporate culture and its central finding was that organizations become shadows of their leaders. It was popularized in leadership workshops and speeches in the mid 1970s when Larry Senn founded Senn-Delaney Leadership to work with top leaders and their teams to shape organizational culture. Its first usage in print was in the book In the Eye of the Storm: Re engineering Corporate Culture published by the Leadership Press in 1995 and written by John Childress and Larry Senn. It was covered more extensively in a 2006 book Winning Teams - Winning Cultures by Larry Senn and Jim Hart.

Chapter- 7

Motivation

Motivation is the driving force which causes us to achieve goals. Motivation is said to be intrinsic or extrinsic. The term is generally used for humans but, theoretically, it can also be used to describe the causes for animal behavior as well. Here we, refers to human motivation. According to various theories, motivation may be rooted in the basic need to minimize physical pain and maximize pleasure, or it may include specific needs such as eating and resting, or a desired object, goal, state of being, ideal, or it may be attributed to less-apparent reasons such as altruism, selfishness, morality, or avoiding mortality. Conceptually, motivation should not be confused with either volition or optimism. Motivation is related to, but distinct from, emotion.

Motivation concepts Intrinsic and extrinsic motivation Intrinsic motivation refers to motivation that is driven by an interest or enjoyment in the task itself, and exists within the individual rather than relying on any external pressure. Intrinsic motivation has been studied by social and educational psychologists since the early 1970s. Research has found that it is usually associated with high educational achievement and enjoyment by students. Explanations of intrinsic motivation have been given in the context of Fritz Heider's attribution theory, Bandura's work on self-efficacy, and Deci and Ryan's cognitive evaluation theory. Students are likely to be intrinsically motivated if they: • • •

attribute their educational results to internal factors that they can control (e.g. the amount of effort they put in), believe they can be effective agents in reaching desired goals (i.e. the results are not determined by luck), are interested in mastering a topic, rather than just rote-learning to achieve good grades.

Extrinsic motivation comes from outside of the individual. Common extrinsic motivations are rewards like money and grades, coercion and threat of punishment. Competition is in general extrinsic because it encourages the performer to win and beat

others, not to enjoy the intrinsic rewards of the activity. A crowd cheering on the individual and trophies are also extrinsic incentives. Social psychological research has indicated that extrinsic rewards can lead to overjustification and a subsequent reduction in intrinsic motivation. In one study demonstrating this effect, children who expected to be (and were) rewarded with a ribbon and a gold star for drawing pictures spent less time playing with the drawing materials in subsequent observations than children who were assigned to an unexpected reward condition and to children who received no extrinsic reward. Self-determination theory proposes that extrinsic motivation can be internalised by the individual if the task fits with their values and beliefs and therefore helps to fulfill their basic psychological needs.

Self-control The self-control of motivation is increasingly understood as a subset of emotional intelligence; a person may be highly intelligent according to a more conservative definition (as measured by many intelligence tests), yet unmotivated to dedicate this intelligence to certain tasks. Yale School of Management professor Victor Vroom's "expectancy theory" provides an account of when people will decide whether to exert self control to pursue a particular goal. Drives and desires can be described as a deficiency or need that activates behavior that is aimed at a goal or an incentive. These are thought to originate within the individual and may not require external stimuli to encourage the behavior. Basic drives could be sparked by deficiencies such as hunger, which motivates a person to seek food; whereas more subtle drives might be the desire for praise and approval, which motivates a person to behave in a manner pleasing to others. By contrast, the role of extrinsic rewards and stimuli can be seen in the example of training animals by giving them treats when they perform a trick correctly. The treat motivates the animals to perform the trick consistently, even later when the treat is removed from the process.

Motivational theories Incentive theory A reward, tangible or intangible, is presented after the occurrence of an action (i.e. behavior) with the intent to cause the behavior to occur again. This is done by associating positive meaning to the behavior. Studies show that if the person receives the reward immediately, the effect would be greater, and decreases as duration lengthens. Repetitive action-reward combination can cause the action to become habit. Motivation comes from two sources: oneself, and other people. These two sources are called intrinsic motivation and extrinsic motivation, respectively.

Applying proper motivational techniques can be much harder than it seems. Steven Kerr notes that when creating a reward system, it can be easy to reward A, while hoping for B, and in the process, reap harmful effects that can jeopardize your goals. A reinforcer is different from reward, in that reinforcement is intended to create a measured increase in the rate of a desirable behavior following the addition of something to the environment. Incentive theory in psychology, treats motivation and behavior of the individual, as they are influenced by beliefs, such as engaging in activities that are expected to be profitable. Incentive theory is promoted by behavioral psychologists, such as B.F. Skinner and literalized, by behaviorists, especially by Skinner in his philosophy of Radical behaviorism, to mean that a person's actions always have social ramifications: and if actions are positively received people are more likely to act in this manner, or if negatively received people are less likely to act in this manner. Incentive theorists tend to distinguish between wanting and liking, where liking is a passive function evaluating a stimulus, but wanting adds an active process "attracting" the person towards the stimulus. Incentive theory distinguishes itself from other motivation theories, such as drive theory, in the direction of the motivation. In incentive theory, stimuli "attract", to use the term above, a person towards them. As opposed to the body seeking to reestablish homeostasis pushing it towards the stimulus. In terms of behaviorism, incentive theory involves positive reinforcement: the stimulus has been conditioned to make the person happier. For instance, a person knows that eating food, drinking water, or gaining social capital will make them happier. As opposed to in drive theory, which involves negative reinforcement: a stimulus has been associated with the removal of the punishment-- the lack of homeostasis in the body. For example, a person has come to know that if they eat when hungry, it will eliminate that negative feeling of hunger, or if they drink when thirsty, it will eliminate that negative feeling of thirst.

Drive-reduction theories There are a number of drive theories. The Drive Reduction Theory grows out of the concept that we have certain biological drives, such as hunger. As time passes the strength of the drive increases if it is not satisfied (in this case by eating). Upon satisfying a drive the drive's strength is reduced. The theory is based on diverse ideas from the theories of Freud to the ideas of feedback control systems, such as a thermostat. Drive theory has some intuitive or folk validity. For instance when preparing food, the drive model appears to be compatible with sensations of rising hunger as the food is prepared, and, after the food has been consumed, a decrease in subjective hunger. There are several problems, however, that leave the validity of drive reduction open for debate. The first problem is that it does not explain how secondary reinforcers reduce drive. For example, money satisfies no biological or psychological needs, but a pay check appears to reduce drive through second-order conditioning. Secondly, a drive, such as hunger, is viewed as having a "desire" to eat, making the drive a homuncular being—a feature

criticized as simply moving the fundamental problem behind this "small man" and his desires. In addition, it is clear that drive reduction theory cannot be a complete theory of behavior, or a hungry human could not prepare a meal without eating the food before he finished cooking it. The ability of drive theory to cope with all kinds of behavior, from not satisfying a drive (by adding on other traits such as restraint), or adding additional drives for "tasty" food, which combine with drives for "food" in order to explain cooking render it hard to test.

Cognitive dissonance theory Suggested by Leon Festinger, this occurs when an individual experiences some degree of discomfort resulting from an incompatibility between two cognitions. For example, a consumer may seek to reassure himself regarding a purchase, feeling, in retrospect, that another decision may have been preferable. Another example of cognitive dissonance is when a belief and a behavior are in conflict. A person may wish to be healthy, believes smoking is bad for one's health, and yet continues to smoke.

Need theories

Need hierarchy theory Abraham Maslow's theory is one of the most widely discussed theories of motivation. The theory can be summarized as follows: • • • •

Human beings have wants and desires which influence their behavior. Only unsatisfied needs influence behavior, satisfied needs do not. Since needs are many, they are arranged in order of importance, from the basic to the complex. The person advances to the next level of needs only after the lower level need is at least minimally satisfied. The further the progress up the hierarchy, the more individuality, humanness and psychological health a person will show.

The needs, listed from basic (lowest-earliest) to most complex (highest-latest) are as follows: • • • • •

Physiology (hunger, thirst, sleep, etc.) Safety/Security/Shelter/Health Belongingness/Love/Friendship Self-esteem/Recognition/Achievement Self actualization

Herzberg's two-factor theory Frederick Herzberg's two-factor theory, a.k.a. intrinsic/extrinsic motivation, concludes that certain factors in the workplace result in job satisfaction, but if absent, they don't lead to dissatisfaction but no satisfaction. The factors that motivate people can change over their lifetime, but "respect for me as a person" is one of the top motivating factors at any stage of life. He distinguished between: • •

Motivators; (e.g. challenging work, recognition, responsibility) which give positive satisfaction, and Hygiene factors; (e.g. status, job security, salary and fringe benefits) that do not motivate if present, but, if absent, result in demotivation.

The name Hygiene factors is used because, like hygiene, the presence will not make you healthier, but absence can cause health deterioration. The theory is sometimes called the "Motivator-Hygiene Theory" and/or "The Dual Structure Theory." Herzberg's theory has found application in such occupational fields as information systems and in studies of user satisfaction.

Alderfer's ERG theory Alderfer, expanding on Maslow's hierarchy of needs, created the ERG theory. This theory posits that there are three groups of core needs — existence, relatedness, and growth, hence the label: ERG theory. The existence group is concerned with providing our basic material existence requirements. They include the items that Maslow considered to be physiological and safety needs. The second group of needs are those of relatedness- the desire we have for maintaining important interpersonal relationships. These social and status desires require interaction with others if they are to be satisfied, and they align with Maslow's social need and the external component of Maslow's esteem classification. Finally, Alderfer isolates growth needs' an intrinsic desire for personal development. These include the intrinsic component from Maslow's esteem category and the characteristics included under self-actualization.

Self-determination theory Self-determination theory, developed by Edward Deci and Richard Ryan, focuses on the importance of intrinsic motivation in driving human behavior. Like Maslow's hierarchical theory and others that built on it, SDT posits a natural tendency toward growth and development. Unlike these other theories, however, SDT does not include any sort of "autopilot" for achievement, but instead requires active encouragement from the

environment. The primary factors that encourage motivation and development are autonomy, competence feedback, and relatedness.

Broad theories The latest approach in developing a broad, integrative theory of motivation is Temporal Motivation Theory, developed by Piers Steel and Cornelius Konig. Introduced in their 2007 Academy of Management Review article, it synthesizes into a single formulation the primary aspects of all other major motivational theories, including Incentive Theory, Drive Theory, Need Theory, Self-Efficacy and Goal Setting. Notably, it simplifies the field of motivation considerably and allows findings from one theory to be translated into terms of another. Also, Achievement Motivation is an integrative perspective as outlined in the "OnionRing-Model of Achievement Motivation" by Heinz Schuler, George C. Thornton III, Andreas Frintrup and Rose Mueller-Hanson. It is based on the premise that performance motivation results from the way broad components of personality are directed towards performance. As a result, it includes a range of dimensions that are relevant to success at work but which are not conventionally regarded as being part of performance motivation. Especially it integrates formerly separated approaches as Need for Achievement with e.g. social motives like dominance. The Achievement Motivation Inventory (AMI) (Schuler, Thornton, Frintrup & Mueller-Hanson, 2003) is based on this theory and assesses three factors (17 separated scales) relevant to vocational and professional success.

Cognitive theories

Goal-setting theory Goal-setting theory is based on the notion that individuals sometimes have a drive to reach a clearly defined end state. Often, this end state is a reward in itself. A goal's efficiency is affected by three features: proximity, difficulty and specificity. An ideal goal should present a situation where the time between the initiation of behavior and the end state is close. This explains why some children are more motivated to learn how to ride a bike than mastering algebra. A goal should be moderate, not too hard or too easy to complete. In both cases, most people are not optimally motivated, as many want a challenge (which assumes some kind of insecurity of success). At the same time people want to feel that there is a substantial probability that they will succeed. Specificity concerns the description of the goal in their class. The goal should be objectively defined and intelligible for the individual. A classic example of a poorly specified goal is to get the highest possible grade. Most children have no idea how much effort they need to reach that goal.

Models of behavior change Social-cognitive models of behavior change include the constructs of motivation and volition. Motivation is seen as a process that leads to the forming of behavioral

intentions. Volition is seen as a process that leads from intention to actual behavior. In other words, motivation and volition refer to goal setting and goal pursuit, respectively. Both processes require self-regulatory efforts. Several self-regulatory constructs are needed to operate in orchestration to attain goals. An example of such a motivational and volitional construct is perceived self-efficacy. Self-efficacy is supposed to facilitate the forming of behavioral intentions, the development of action plans, and the initiation of action. It can support the translation of intentions into action.

Unconscious motivation Some psychologists believe that a significant portion of human behavior is energized and directed by unconscious motives. According to Maslow, "Psychoanalysis has often demonstrated that the relationship between a conscious desire and the ultimate unconscious aim that underlies it need not be at all direct."

Intrinsic motivation and the 16 basic desires theory Starting from studies involving more than 6,000 people, Professor Steven Reiss has proposed a theory that find 16 basic desires that guide nearly all human behavior. The desires are: • • • • •

• • •

Acceptance, the need for approval Curiosity, the need to learn Eating, the need for food Family, the need to raise children Honor, the need to be loyal to the traditional values of one's clan/ethnic group Idealism, the need for social justice Independence, the need for individuality Order, the need for organized, stable, predictable environments

• • • • • • • •

Physical activity, the need for exercise Power, the need for influence of will Romance, the need for sex Saving, the need to collect Social contact, the need for friends (peer relationships) Status, the need for social standing/importance Tranquility, the need to be safe Vengeance, the need to strike back/to win

In this model, people differ in these basic desires. These basic desires represent intrinsic desires that directly motivate a person's behavior, and not aimed at indirectly satisfying other desires. People may also be motivated by non-basic desires, but in this case this does not relate to deep motivation, or only as a means to achieve other basic desires.

Other theories • •

Reversal theory Motivating operation

Controlling motivation The control of motivation is only understood to a limited extent. There are many different approaches of motivation training, but many of these are considered pseudoscientific by critics. To understand how to control motivation it is first necessary to understand why many people lack motivation.

Employee motivation

The photo shows a training meeting with factory workers in a stainless steel ecodesign company from Rio de Janeiro, Brazil. These type of meeting are important in order to establish a higher employee motivation Workers in any organization need something to keep them working. Most times the salary of the employee is enough to keep him or her working for an organization. However, sometimes just working for salary is not enough for employees to stay at an organization. An employee must be motivated to work for a company or organization. If no motivation is present in an employee, then that employee’s quality of work or all work in general will deteriorate. When motivating an audience, you can use general motivational strategies or specific motivational appeals. General motivational strategies include soft sell versus hard sell and personality type. Soft sell strategies have logical appeals, emotional appeals, advice and praise. Hard sell strategies have barter, outnumbering, pressure and rank. Also, you can consider basing your strategy on your audience personality. Specific motivational

appeals focus on provable facts, feelings, right and wrong, audience rewards and audience threats.

Drugs Some authors, especially in the transhumanist movement, have suggested the use of "smart drugs", also known as nootropics, as "motivation-enhancers". The effects of many of these drugs on the brain are emphatically not well understood, and their legal status often makes open experimentation difficult.

Applications Education Motivation is of particular interest to educational psychologists because of the crucial role it plays in student learning. However, the specific kind of motivation that is studied in the specialized setting of education differs qualitatively from the more general forms of motivation studied by psychologists in other fields. Motivation in education can have several effects on how students learn and how they behave towards subject matter. It can: 1. 2. 3. 4. 5. 6.

Direct behavior toward particular goals Lead to increased effort and energy Increase initiation of, and persistence in, activities Enhance cognitive processing Determine what consequences are reinforcing Lead to improved performance.

Because students are not always internally motivated, they sometimes need situated motivation, which is found in environmental conditions that the teacher creates. The majority of new student orientation leaders at colleges and universities recognize that distinctive needs of students should be considered in regard to orientation information provided at the beginning of the higher education experience. Research done by Whyte in 1986 raised the awareness of counselors and educators in this regard. In 2007, the National Orientation Directors Association reprinted Cassandra B. Whyte's research report allowing readers to ascertain improvements made in addressing specific needs of students over a quarter of a century later to help with academic success. There are two kinds of motivation: •

Intrinsic motivation occurs when people are internally motivated to do something because it either brings them pleasure, they think it is important, or they feel that what they are learning is significant. It has been shown that intrinsic motivation for education drops from grades 3-9 though the exact cause cannot be

•

ascertained. Also, in younger students it has been shown that contextualizing material that would otherwise be presented in an abstract manner increases the intrinsic motivation of these students. Extrinsic motivation comes into play when a student is compelled to do something or act a certain way because of factors external to him or her (like money or good grades).

Whyte researched and reported about the importance of locus of control and academic achievement. Students tending toward a more internal locus of control are more academically successful, thus encouraging curriculum and activity development with consideration of motivation theories. Motivation has been found to be an important element in the concept of Andragogy (what motivates the adult learner), and in treating Autism Spectrum Disorders, as in Pivotal Response Therapy.

Sudbury Model schools' approach to motivation Sudbury Model schools adduce that the cure to the problem of procrastination, of learning in general, and particularly of scientific illiteracy is to remove once and for all what they call the underlying disease: compulsion in schools. They contend that human nature in a free society recoils from every attempt to force it into a mold; that the more requirements we pile onto children at school, the surer we are to drive them away from the material we are trying to force down their throats; that after all the drive and motivation of infants to master the world around them is legendary. They assert that schools must keep that drive alive by doing what some of them do: nurturing it on the freedom it needs to thrive. Sudbury Model schools do not perform and do not offer evaluations, assessments, transcripts, or recommendations, asserting that they do not rate people, and that school is not a judge; comparing students to each other, or to some standard that has been set is for them a violation of the student's right to privacy and to self-determination. Students decide for themselves how to measure their progress as self-starting learners as a process of self-evaluation: real life-long learning and the proper educational evaluation for the 21st century, they adduce. According to Sudbury Model schools, this policy does not cause harm to their students as they move on to life outside the school. However, they admit it makes the process more difficult, but that such hardship is part of the students learning to make their own way, set their own standards and meet their own goals. The no-grading and no-rating policy helps to create an atmosphere free of competition among students or battles for adult approval, and encourages a positive cooperative environment amongst the student body.

Business At lower levels of Maslow's hierarchy of needs, such as physiological needs, money is a motivator, however it tends to have a motivating effect on staff that lasts only for a short

period (in accordance with Herzberg's two-factor model of motivation). At higher levels of the hierarchy, praise, respect, recognition, empowerment and a sense of belonging are far more powerful motivators than money, as both Abraham Maslow's theory of motivation and Douglas McGregor's theory X and theory Y (pertaining to the theory of leadership) demonstrate. Maslow has money at the lowest level of the hierarchy and shows other needs are better motivators to staff. McGregor places money in his Theory X category and feels it is a poor motivator. Praise and recognition are placed in the Theory Y category and are considered stronger motivators than money. • • •

Motivated employees always look for better ways to do a job. Motivated employees are more quality oriented. Motivated workers are more productive.

The average workplace is about midway between the extremes of high threat and high opportunity. Motivation by threat is a dead-end strategy, and naturally staff are more attracted to the opportunity side of the motivation curve than the threat side. Motivation is a powerful tool in the work environment that can lead to employees working at their most efficient levels of production. Nonetheless, Steinmetz also discusses three common character types of subordinates: ascendant, indifferent, and ambivalent who all react and interact uniquely, and must be treated, managed, and motivated accordingly. An effective leader must understand how to manage all characters, and more importantly the manager must utilize avenues that allow room for employees to work, grow, and find answers independently. The assumptions of Maslow and Herzberg were challenged by a classic study at Vauxhall Motors' UK manufacturing plant. This introduced the concept of orientation to work and distinguished three main orientations: instrumental (where work is a means to an end), bureaucratic (where work is a source of status, security and immediate reward) and solidaristic (which prioritises group loyalty). Other theories which expanded and extended those of Maslow and Herzberg included Kurt Lewin's Force Field Theory, Edwin Locke's Goal Theory and Victor Vroom's Expectancy theory. These tend to stress cultural differences and the fact that individuals tend to be motivated by different factors at different times. According to the system of scientific management developed by Frederick Winslow Taylor, a worker's motivation is solely determined by pay, and therefore management need not consider psychological or social aspects of work. In essence, scientific management bases human motivation wholly on extrinsic rewards and discards the idea of intrinsic rewards. In contrast, David McClelland believed that workers could not be motivated by the mere need for money—in fact, extrinsic motivation (e.g., money) could extinguish intrinsic

motivation such as achievement motivation, though money could be used as an indicator of success for various motives, e.g., keeping score. In keeping with this view, his consulting firm, McBer & Company, had as its first motto "To make everyone productive, happy, and free." For McClelland, satisfaction lay in aligning a person's life with their fundamental motivations. Elton Mayo found that the social contacts a worker has at the workplace are very important and that boredom and repetitiveness of tasks lead to reduced motivation. Mayo believed that workers could be motivated by acknowledging their social needs and making them feel important. As a result, employees were given freedom to make decisions on the job and greater attention was paid to informal work groups. Mayo named the model the Hawthorne effect. His model has been judged as placing undue reliance on social contacts at work situations for motivating employees. In Essentials of Organizational Behavior, Robbins and Judge examine recognition programs as motivators, and identify five principles that contribute to the success of an employee incentive program: • • • • •

Recognition of employees' individual differences, and clear identification of behavior deemed worthy of recognition Allowing employees to participate Linking rewards to performance Rewarding of nominators Visibility of the recognition process

Online communities Motivation to participate and contribute represents one of the most important element in the success of online communities (and virtual communities).

Chapter- 8

Emotional Labor and Co-determination

Emotional Labor Emotional labor is a form of emotional regulation wherein workers are expected to display certain emotions as part of their job, and to promote organizational goals. The intended effects of these emotional displays are on other, targeted people, who can be clients, customers, subordinates or co-workers.

Definition

A waitress at a restaurant is expected to do emotional work, such as smiling and express positive emotion towards clients The term "emotional labour" was first defined by the sociologist Arlie Hochschild as the

"management of feeling to create a publicly facial and bodily display". Following her piece in which she coined this term, several conceptualizations of emotional labor have been proposed. Some conceptual ambiguity persists, but each conceptualization has in common the general underlying assumption that emotional labor involves managing emotions so that they are consistent with organizational or occupational display rules, regardless of whether they are discrepant with internal feelings. According to Hochschild, jobs involving emotional labor are defined as those that: (1) require face-to-face or voice-to-voice contact with the public; (2) require the worker to produce an emotional state in another person; (3) allow the employees to exercise a degree of control over their emotional activities. Display rules refer to the organizational rules about what kind of emotion to express on the job.

Emotion regulation Emotion regulation refers to the process of modifying one's own emotions and expressions. That is, the processes by which individuals influence which emotions they have, when they have them, and how they experience and express these emotions. There are two kinds of Emotion regulation: 1. antecedent-focused emotion regulation, which refers to modifying initial feelings by changing the situation or the cognitions of the situation; 2. response-focused emotion regulation, which refers to modifying behavior once emotions are experienced by suppressing, faking or amplifying an emotional response.

Forms of emotional labour Employees can display organizationally-desired emotions by acting out the emotion. Such acting can take two forms: 1. surface acting, involves "painting on" affective displays, or faking; Surface acting involves an employee's (presenting emotions on his or her "surface" without actually feeling them. The employee in this case puts on a facade as if the emotions are felt, like a "persona"). 2. deep acting wherein they modify their inner feelings to match the emotion expressions the organization requires. Though both forms of acting are internally false, they represent different intentions. That is, when engaging in deep acting, an actor attempts to modify feelings to match the required displays, in order to seem authentic to the audience ("faking in good faith"); in surface acting, the alternative strategy, employees modify their displays without shaping

inner feelings. They conform to the display rules in order to keep the job, not to help the customer or the organization, ("faking in bad faith"). Deep acting is argued to be associated with reduced stress and an increased sense of personal accomplishment; whereas surface acting is associated with increased stress, emotional exhaustion, depression, and a sense of inauthenticity. In 1983, Arlie Russell Hochschild, who wrote about emotional labor, coined the term emotional dissonance to describe this process of "maintaining a difference between feeling and feigning".

Emotional labour in organizations

A nurse working in a hospital, is expected to express positive emotions towards patients, such as warmth and compassion. In past, emotional labor demands and display rules were viewed as a characteristics of particular occupations, such as restaurant workers, cashiers, hospital workers, bill collectors, counselors, secretaries, and nurses. However, display rules have been

conceptualized not only as role requirements of particular occupational groups, but also as interpersonal job demands, which are shared by many kinds of occupations.

Determinants of using emotional labor 1. Societal, occupational, and organizational norms. For example, empirical evidence indicates that in typically "busy" stores there is more legitimacy to express negative emotions, than there is in typically "slow" stores, in which employees are expected to behave accordingly to the display rules; and so, that the emotional culture to which one belongs influences the employee's commitment to those rules. 2. Dispositional traits and inner feeling on the job; such as employee's emotional expressiveness, which refers to the capability to use facial expressions, voice, gestures, and body movements to transmit emotions; or the employee's level of career identity (the importance of the career role to one's self-identity), which allows him or her to express the organizationally-desired emotions more easily, (because there is less discrepancy between his or her expressed behavior and emotional experience when engage their work). 3. Supervisory regulation of display rules; That is, Supervisors are likely to be important definers of display rules at the job level, given their direct influence on worker's beliefs about high-performance expectations. Moreover, supervisors' impressions of the need to suppress negative emotions on the job influence the employees' impressions of that display rule.

Implications of using emotional labor Studies indicate that emotional labor jobs require the worker to produce an emotional state in another person. For example, flight attendants are encouraged to create good cheer in passengers and bill collectors promote anxiety in debtors. Research on emotional contagion has shown that exposure to an individual expressing positive or negative emotions can produce a corresponding change in the emotional state of the observer. Accordingly, a recent study reveals that employees' display of positive emotions is indeed positively related to customers' positive affect. Positive affective display in service interactions, such as smiling and conveying friendliness, are positively associated with important customer outcomes, such as intention to return, intention to recommend a store to others, and perception of overall service quality. There is evidence that emotion labor may lead to employee's emotional exhaustion and burnout over time, and may also reduce employee's job satisfaction. That is, higher degree of using emotion regulation on the job is related to higher levels of employees' emotional exhaustion, and lower levels of employees' job satisfaction. There is empirical evidence that higher levels of emotional labor demands are not uniformly rewarded with higher wages. Rather, the reward is dependent on the level of general cognitive demands required by the job. That is, occupations with high cognitive demands evidence wage returns with increasing emotional labor demands; whereas

occupations low in cognitive demands evidence a wage "penalty" with increasing emotional labor demands.

Applications Communications expert Sarah J. Tracy, Ph.D., found “three central practical concerns applicable to service organizations.” Her study aboard cruise ships “illustrates the strength and potential abuse of customer-based control of service personnel.” According to Tracy, this occurs because in service based organizations customers frequently become what Tracy terms a "second boss" for the employees. Since service employees are taught that "the customer is always right", this creates confusion among staff as to where to draw boundaries. Tracy explains that when managers use customer evaluations to reward and punish employees, customers essentially become a second boss...especially in job situations in which much of the organizational product consists of employee personality, organizational leaders must temper and contextualize customer service programs with information that helps employees recognize and negotiate the boundaries between selling a smile and accommodating customer abuse or harassment” These findings can be universally applied to service based industries that uses customer feedback in order to judge employee performance in order to maximize production and employee satisfaction. These findings can be used to help service based companies (call center, sales, service) implement new policies for dealing with customers internally and externally.

Co-determination Co-determination is a practice whereby the employees have a role in management of a company. The word is a literal translation from the German word Mitbestimmung. Codetermination rights are different in different legal environments. In some countries, like the USA, the workers have virtually no role in management of companies, and in some, like Germany, their role is more important. The first serious co-determination laws began in Germany. At first there was only worker participation in management in the coal and steel industries. But in 1974, a general law was passed mandating that worker representatives hold seats on the boards of all companies employing over 500 people.

Overview In systems with co-determination workers in large companies usually form special bodies - works councils and in smaller companies elect worker representatives. These act as intermediaries in exercising the workers rights of being informed or consulted with on decisions concerning employee status and rights. They also elect or select worker representatives in managerial and supervisory organs of companies.

In systems with co-determination the employees are given seats in a board of directors in one-tier management systems or seats in a supervisory board and sometimes management board in two-tier management systems. In two-tier systems the seats in supervisory boards are usually limited to 1/3 of all members. In some systems the employees can select 1/2 of all members of supervisory boards, but a representative of shareholders is always the president and has the deciding vote. The employee representatives in management boards are not present in all systems. They are always limited to a workers director, who votes only on matters concerning employees. In one-tier systems with co-determination the employees usually have only one or two representatives in a board of directors. Sometimes they are also given seats in certain committees (e.g. the audit committee). They never have representatives among the executive directors. The typical two-tier system with co-determination is the German system. The typical one-tier system with co-determination is the Swedish system. There are three main views as to why co-determination primarily exists: to reduce management-labour conflict by means of improving and systematizing communication channels; to increase bargaining power of workers at the expense of owners by means of legislation; and to correct market failures by means of public policy. The evidence on "efficiency" is mixed, with co-determination having either no effect or a positive but generally small effect on enterprise performance.

German Mitbestimmung The German model of co-determination is unique. Formulated at the end of World War II, it was applied first in the coal and steel industries of West Germany following the war and gradually expanded to other sectors. Co-determination in Germany is regulated by the Co-operative Management Law (1951), amended in 1976, and the Workers Committee Law (1952), amended in 1972. Within the framework of the 1976 reform, the government broadened the laws' applicability to all firms throughout the German economy employing more than 2,000 workers. The German co-determination law (Mitbestimmungsgesetz) forms part of the bedrock of German industrial and company policy. it requires that just under half of companies' supervisory boards' members are representatives of workers. German company law is curious to an English speaker's eye, because it has not one but two boards of directors. Shareholders and trade unions elect members of a supervisory board (Aufsichtsrat). The chairman of the supervisory board, with a casting vote, is always a shareholder representative under German law. The supervisory board is meant to set the company's general agenda. The supervisory board then elects a management board (Vorstand), which is actually charged with the day to day running of the company. The management board is required to have one worker representative (Arbeitsdirektor). In effect, shareholder voices still govern the company for a number of reasons, but not least because the supervisory board's vote for the

management will always be a majority of shareholders. Co-determination in Germany operates on three organisational levels: 1. Board of directors: Prior to 1976, German coal and steel producers employing more than 1,000 workers commonly maintained a board of directors composed of 11 members: five directors came from management, five were workers' representatives, with the eleventh member being neutral. (Note: Boards could be larger as long as the proportion of representation was maintained.) In 1976, the law's scope was expanded to cover firms employing more than 2,000 workers; there were also revisions to the board structure, which now had an equal number of management and worker representatives, with no neutral members. The new board's head would represent the firm's owners and had the right to cast the deciding vote in instances of stalemate. 2. Management: A worker representative sits with management in the capacity of Director for Human Resources. Elected by a majority of the Board of Directors, the workers' representative sits on the Board and enjoys the full rights accorded to that position. 3. Workers committees: The workers committee has two main functions: it elects representatives to the Board of Directors and serves as an advisory body to the trade union regarding plant-level working conditions, insurance, economic assistance and related issues. The committee is elected by all the workers employed in a plant. Thanks to the years during which a co-operative culture has been in place, management requests from workers for proposals to improve operations or increase productivity, for example, are no longer considered mere legal formalities; they represent recognition of the fact that workers play an important part in plant success. In tandem, a practical approach has evolved among both parties, with each aiming to reach decisions based on consensus. In addition, worker representatives no longer automatically reject every proposal for structural reform, increased efficiency of even layoffs; instead, they examine each suggestion from an inclusive, long-term perspective. At the core of this approach is transparency of information, such as economic data. Co-determination is thus practised at every level, from the local plant to firm headquarters. Co-determination enjoys intractable support among Germans in principle. In practice, there are many calls for amendments to the laws in various ways. One of the main achievements seems to be that workers are more involved and have more of a voice in their workplaces, which sees a return in high productivity. Furthermore, industrial relations are more harmonious with low levels of strike actions, while better pay and conditions are secured for employees.

The UK Bullock Report In Britain, the proposals for co-determination were drawn up, and a command paper produced named the Bullock Report. This was done in 1977 by the Harold Wilson Labour Party (UK) government. It involved a similar split on the board, but its effect

would have been even more radical. Because UK company law requires no split in the boards of directors, unions would have directly elected the management of the company. Furthermore, rather than giving shareholders the slight upper hand as happened in Germany, a debated 'independent' element would be added to the board, reaching the formula 2x + y. However no action was ever taken as the UK slid into the winter of discontent and, as Labour lost the next election, two decades of Thatcherism. This tied into the European Commission's proposals for worker participation in the 'fifth company law directive', which was never implemented.

EU Fifth Directive Also in the 1970s, the European Community (now the European Union) drafted the 5th Directive on company law, proposing a two-tier board and worker representation on supervisory boards. This was similar to the German model. The directive has not yet won widespread support to be brought into force.

Chapter- 9

Group Development

The goal of most research on group development is to learn why and how small groups change over time. To do this, researchers examine patterns of change and continuity in groups over time. Aspects of a group that might be studied include the quality of the output produced by a group, the type and frequency of its activities, its cohesiveness, the existence of conflict, etc. A number of theoretical models have been developed to explain how certain groups change over time. Listed below are some of the most common models. In some cases, the type of group being considered influenced the model of group development proposed as in the case of therapy groups. In general, some of these models view group change as regular movement through a series of "stages," while others view them as "phases" that groups may or may not go through and which might occur at different points of a group's history. Attention to group development over time has been one of the differentiating factors between the study of ad hoc groups and the study of teams such as those commonly used in the workplace, the military, sports and many other contexts.

Theories and Models In the early seventies, Hill and Grunner (1973) reported that more than 100 theories of group development existed. Since then, other theories have emerged as well as attempts at contrasting and synthesizing them. As a result, a number of typologies of group change theories have been proposed. A typology advanced by George Smith (2001) based on the work of Mennecke and his colleagues (1992) classifies theories based on whether they perceive change to occur in a linear fashion, through cycles of activities, or through processes that combine both paths of change, or which are completely non-phasic. Other typologies are based on whether the primary forces promoting change and stability in a group are internal or external to the group. A third framework advanced by Andrew Van de Ven and Marshall Scott Poole (1995), differentiates theories based on four distinct "motors" for generating change. According to this framework, the following four types of group development models exist:

Life cycle models: Teleological models: Dialectical models: Evolutionary models:

Describe the process of change as the unfolding of a prescribed and linear sequence of stages following a program that is prefigured at the beginning of the cycle (decided within the group or imposed on it). Describe change as a purposeful movement toward one or more goals, with adjustments based on feedback from the environment. Describe change as emerging from conflict between opposing entities and eventual synthesis leading to the next cycle of conflict Describe change as emerging from a repeated cycle of variation, selection and retention and generally apply to change in a population rather than change within an entity over time.

Some theories allow for combinations and interactions among these four "motors". For example, Poole (see below) found in his empirical research that seemingly complex patterns of behavior in group decision making result from the interplay of life-cycle and teleological motors. An important observation made by McGrath and Tschan (2004) regarding the different models of group development found in the literature is that different models might explain different aspects of the history of a group. On the one hand, some models treat the group as an entity and describe its stages of development as a functioning unit or "intact system" (p. 101). In this case, the models should be independent of the specific details of the task that the group is performing. On the other hand, some models might describe phases of the group's task performance and, because of this, tend to be very sensitive to the type of task that the group is engaged in (the "acting system", p. 101). Below are descriptions of the central elements of some of the most common models of group development.

Kurt Lewin's Individual Change Process The first systematic study of group development was carried out by Kurt Lewin, who introduced the term "group dynamics" (Arrow et al., 2005). His ideas about mutual, cross-level influence and quasi-stationary equilibria, although uncommon in the traditional empirical research on group development, have resurged recently. His early model of individual change, which has served as the basis of many models of group development, described change as a three-stage process: unfreezing, change, and freezing. Unfreezing: Change Freezing

This phase involves overcoming inertia and dismantling the existing "mind set". Defense mechanisms have to be bypassed. In the second stage change occurs. This is typically a period of confusion and transition. One is aware that the old ways are being challenged but does not have a clear picture to replace them with yet. In the third stage the new mindset is crystallizing and one's comfort level is returning to previous levels. This is often misquoted as "refreezing".

Tuckman's Stages model Bruce Tuckman reviewed about fifty studies of group development (including Bales' model) in the mid-sixties and synthesized their commonalities in one of the most frequently cited models of group development (Tuckman, 1965). The model describes four linear stages (forming, storming, norming, and performing) that a group will go through in its unitary sequence of decision making. A fifth stage (adjourning) was added in 1977 when a new set of studies were reviewed (Tuckman & Jensen, 1977). Group members learn about each other and the task at hand. Indicators of this stage might include: Unclear objectives, Uninvolvement, Uncommitted Forming: members, Confusion, Low morale, Hidden feelings, Poor listening, etc. As group members continue to work, they will engage each other in arguments about the structure of the group which often are significantly emotional and illustrate a struggle for status in the group. These activities Storming: mark the storming phase: Lack of cohesion, Subjectivity, Hidden agendas, Conflicts, Confrontation, Volatility, Resentment, anger, Inconsistency, Failure. Group members establish implicit or explicit rules about how they will achieve their goal. They address the types of communication that will or will not help with the task. Indicators include: Questioning performance, Norming: Reviewing/clarify objective, Changing/confirming roles, Opening risky issues, Assertiveness, Listening, Testing new ground, Identifying strengths and weaknesses. Groups reach a conclusion and implement the solution to their issue. Indicators include: Creativity, Initiative, Flexibility, Open relationships, Performing: Pride, Concern for people, Learning, Confidence, High morale, Success, etc. As the group project ends, the group disbands in the adjournment phase. Adjourning: This phase was added when Tuckman and Jensen's updated their original review of the literature in 1977. Each of the five stages in the Forming-storming-norming-performing-adjourning model proposed by Tuckman involves two aspects: interpersonal relationships and task behaviors. Such a distinction is similar to Bales' (1950) equilibrium model which states that a group continuously divides its attention between instrumental (task-related) needs and expressive (socioemotional). As Gersick (1988) has pointed out, some later models followed similar sequential patterns. Examples include: define the situation, develop new skills, develop appropriate roles, carry out the work (Hare, 1976); orientation, dissatisfaction, resolution, production, termination (LaCoursiere, 1980); and generate plans, ideas, and goals; choose&agree on alternatives, goals, and policies; resolve conflicts and develop norms; perform action tasks and maintain cohesion (McGrath, 1984).

Tubbs' Systems model Stewart Tubbs "systems" approach to studying small group interaction led him to the creation of a four-phase model of group development: In this stage, group members get to know each other, they start to talk about Orientation: the problem, and they examine the limitations and opportunities of the project. Conflict is a necessary part of a group's development. Conflict allows the group to evaluate ideas and it helps the group avoid conformity and Conflict: groupthink Conflict ends in the consensus stage, when group members compromise, Consensus: select ideas, and agree on alternatives. In this stage, the final result is announced and group members reaffirm their Closure support of the decision.

Fisher's theory of decision emergence in groups Fisher outlines four phases through which task groups tend to proceed when engaged in decision making. By observing the distribution of act-response pairs (a.k.a. "interacts") across different moments of the group process, Fisher noted how the interaction changed as the group decision was formulated and solidified. His method pays special attention to the "content" dimension of interactions by classifying statements in terms of how they respond to a decision proposal (e.g. agreement, disagreement, etc.). During the orientation phase, group members get to know each other and they experience a primary tension: the awkward feeling people have before communication rules and expectations are established. Groups Orientation: should take time to learn about each other and feel comfortable communicating around new people. The conflict phase is marked by secondary tension, or tension surrounding the task at hand. Group members will disagree with each Conflict: other and debate ideas. Here conflict is viewed as positive, because it helps the group achieve positive results. In the emergence phase, the outcome of the group's task and its social structure become apparent. Group members soften their positions and Emergence: undergo and attitudinal change that makes them less tenacious in defending their individual viewpoint. In this stage, group members bolster their final decision by using Reinforcement: supportive verbal and nonverbal communication. Based on this categorization, Fisher created his "Decision Proposal Coding System" that identifies act-response pairs associated with each decision-making phase. Interestingly, Fisher observed that the group decision making process tended to be more cyclical and,

in some cases, almost erratic. He hypothesized that the interpersonal demands of discussion require "breaks" from task work. In particular, Fisher observed that there are a number of contingencies that might explain some of the decision paths taken by some groups. For instance, in modifying proposals, groups tend to follow one of two patterns. If conflict is low, the group will reintroduce proposals in less abstract, more specific language. When conflict is higher, the group might not attempt to make a proposal more specific but, instead, because disagreement lies on the basic idea, the group introduces substitute proposals of the same level of abstraction as the original.

Poole's multiple-sequences model Marshall Scott Poole’s model suggests that different groups employ different sequences in making decisions. In contrast to unitary sequence models, the multiple sequences model addresses decision making as a function of several contingency variables: task structure, group composition, and conflict management strategies. Poole developed a descriptive system for studying multiple sequences, beyond the abstract action descriptions of previous studies. From Bales’ Interaction Process Analysis System and Fisher’s Decision Proposal Coding System, Poole proposes 36 clusters of group activities for coding group interactions and 4 cluster-sets: proposal development, socioemotional concerns, conflict, and expressions of ambiguity. However, in his latter work, Poole rejected phasic models of group development and proposed a model of continuously developing threads of activity. In essence, discussions are not characterized by blocks of phases, one after another, but by intertwining tracks of activity and interaction. Poole suggests three activity tracks: task progress, relational, and topical focus. Interspersed with these are breakpoints, marking changes in the development of strands and links between them. Normal breakpoints pace the discussion with topic shifts and adjournments. Delays, another breakpoint, are holding patterns of recycling through information. Finally, disruptions break the discussion threads with conflict or task failure. The task track concerns the process by which the group accomplishes its goals, such as dealing doing problem analysis, designing solutions, etc. The relation track deals with the interpersonal relationships between the group members. At times, the group may stop its work on the task and Relation work instead on its relationships, share personal information or engage in track: joking. The topic track includes a series of issues or concerns the group have over Topic track: time Breakpoints occur when a group switches from one track to another. Breakpoints: Shifts in the conversation, adjournment, or postponement are examples of breakpoints. Task track:

McGrath's Time, Interaction, and Performance (TIP) theory McGrath's (1991) work emphasized the notion that different teams might follow different developmental paths to reach the same outcome. He also suggested that teams engage in four modes of group activity: inception, technical problem solving, conflict resolution, and execution According to this model, modes "are potential, not required, forms of activity" (p. 153) resulting in Modes I and IV (inception and execution) being involved in all group tasks and projects while Modes II (technical problem solving) and III (conflict resolution) may or may not be involved in any given group activity (Hare, 2003 uses the terms meaning, resources, integration, and goal attainment for these four modes). McGrath further suggested that all team projects begin with Mode I (goal choice) and end with Mode IV (goal attainment) but that Modes II and III may or may not be needed depending on the task and the history of the group’s activities. McGrath contended that for each identified function, groups can follow a variety of alternative "time-activity paths" in order to move from the initiation to the completion of a given function. Specifically, TIP theory states that there is a "default path" between two modes of activity which is "satisficing" or "least effort" path, and that such default path will "prevail unless conditions warrant some more complex path" (1991, p. 159). Mode I: Inception Mode II: Technical Problem Solving Mode III: Conflict Resolution Mode IV: Execution

Inception and acceptance of a project (goal choice) Solution of technical issues (means choice) Resolution of conflict, that is, of political issues (policy choice) Execution of the performance requirements of the project (goal attainment)

This model also states that groups adopt these four modes with respect to each of three team functions: production, well-being, and member support. In this sense, groups are seen as "always acting in one of the four modes with respect to each of the three functions, but they are not necessarily engaged in the same mode for all functions, nor are they necessarily engaged in the same mode for a given function on different projects that may be concurrent" (McGrath, 1991, p. 153). The following table illustrates the relationship between modes and functions.

Mode I: Inception Mode II: Problem Solving

Functions Production Well-being Production Interaction

Member Support Inclusion

Demand/ Opportunity Demand/ Opportunity Demand/ Opportunity Technical Role Position/ Problem Solving

Network Definition

Status Attainment

Mode III: Conflict Resolution Mode IV: Execution

Policy

Power/

Contribution/

Conflict Resolution

Payoff Distribution

Payoff Relationships

Performance

Interaction

Participation

Gersick's Punctuated Equilibrium model Gersick's study of naturally occurring groups departs from the traditionally linear models of group development. Her punctuated equilibrium model (Gersick, 1988, 1989, 1991) suggests that groups develop through the sudden formation, maintenance, and sudden revision of a "framework for performance". This model describes the processes through which such frameworks are formed and revised and predicts both the timing of progress and when and how in their development groups are likely, or unlikely, to be influenced by their environments. The specific issues and activities that dominate groups' work are left unspecified in the model, since groups' historical paths are expected to vary. Her proposed model works in the following way. According to the model, a framework of behavioral patterns and assumptions through which a group approaches its project emerges in its first meeting, and the group stays with that framework through the first half of its life. Teams Phase I may show little visible progress during this time because members may be unable to perceive a use for the information they are generating until they revise the initial framework. At their calendar midpoints, groups experience transitions-paradigmatic shifts in their approaches to their work-enabling them to capitalize on the gradual learning they have done and make significant advances. The transition is a Midpoint powerful opportunity for a group to alter the course of its life midstream. But the transition must be used well, for once it is past a team is unlikely to alter its basic plans again. A second period of inertial movement, takes its direction from plans crystallized during the transition. At completion, when a team makes a final Phase 2 effort to satisfy outside expectations, it experiences the positive and negative consequences of past choices.

Wheelan’s Integrated Model of Group Development Building on Tuckman’s model and based on her own empirical research as well as the foundational work of Wilfred Bion, Susan Wheelan proposed a “unified” or “integrated” model of group development (Wheelan, 1990; Wheelan, 1994a). This model, although linear in a sense, takes the perspective that groups achieve maturity as they continue to work together rather than simply go through stages of activity. In this model “early” stages of group development are associated with specific issues and patterns of talk such as those related to dependency, counter-dependency, and trust which precede the actual

work conducted during the “more mature” stages of a group's life. The table below describes each one of these phases.

Stage I Dependency and Inclusion

Stage II Counterdependency and Fight

Stage III Trust / Structure

Stage IV Work / Productivity

Final

The first stage of group development is characterized by significant member dependency on the designated leader, concerns about safety, and inclusion issues. In this stage, members rely on the leader and powerful group members to provide direction. Team members may engage in what has been called “pseudo-work,” such as exchanging stories about outside activities or other topics that are not relevant to group goals. In the second stage of group development members disagree among themselves about group goals and procedures. Conflict is an inevitable part of this process. The group’s task at Stage 2 is to develop a unified set of goals, values, and operational procedures, and this task inevitably generates some conflict. Conflict also is necessary for the establishment of trust and a climate in which members feel free to disagree with each other. If the group manages to work through the inevitable conflicts of Stage 2, member trust, commitment to the group, and willingness to cooperate increase. Communication becomes more open and task-oriented. This third stage of group development, referred to as the trust and structure stage, is characterized by more mature negotiations about roles, organization, and procedures. It is also a time in which members work to solidify positive working relationships with each other As its name implies, the fourth stage of group development is a time of intense team productivity and effectiveness. Having resolved many of the issues of the previous stages, the group can focus most of its energy on goal achievement and task accomplishment Groups that have a distinct ending point experience a fifth stage. Impending termination may cause disruption and conflict in some groups. In other groups, separation issues are addressed, and members’ appreciation of each other and the group experience may be expressed.

Based on this model, Wheelan has created and validated both a Group Development Observation System (GDOS) and a Group Development Questionnaire (GDQ). The GDOS allows researchers to determine the developmental stage of a group by categorizing and counting each complete thought exhibited during a group session into one of eight categories: Dependency statements, Counterdependency, Fight, Flight, Pairing, Counterpairing, Work, or Unscorable statements (Wheelan, 1994). The GDQ is used to survey group members and assess their individual perception of their group’s developmental state (Wheelan, S., & Hochberger, 1996). Her academic work has been transferred into a commercial organization, GDQ Associates, Inc.

In her empirical validation of the model, Wheelan (2003) has analyzed the relationship between the length of time that a group has been meeting and the verbal behavior patterns of its members as well as the member’s perceptions of the state of development of the group. Her results seem to indicate that there is a significant relationship between the length of time that a group had been meeting and the verbal behavior patterns of its members. Also, members of older groups tended to perceive their groups to have more of the characteristics of Stage-3 and Stage-4 groups and to be more productive. Based on these results, Wheelan’s position supports the traditional linear models of group development and casts doubt on the cyclic models and Gersick’s punctuated equilibrium model.

Morgan, Salas & Glickman's TEAM model Combining multiple theories and the development models of Tuckman and Gersick, Morgan, Salas and Glickman (1994) created the Team Evolution and Maturation (TEAM) model to describe a series of nine developmental stages through which newly formed, task-oriented teams are hypothesized to evolve. The periods of development are labeled "stages" and conceived to be "relatively informal, indistinct, and overlapping", because "sharp demarcations are not often characteristic of the dynamic situations in which operational teams work and develop". According to this model, teams might begin a given period of development at different stages and spend different amounts of time in the various stages. Teams are not always expected to progress in a linear fashion through all of the stages. A team's beginning point and pattern of progression through the stages depend on factors such as the characteristics of the team and team members, their past histories and experience, the nature of their tasks, and the environmental demands and constraints (cf. McGrath, 1991). The TEAM model identities a total of nine stages, seven central ones supplemented by two additional ones. The seven central stages begin with the formation of the team during its first meeting (forming) and moves through the members' initial, and sometimes unstable, exploration of the situation (storming), initial efforts toward accommodation and the formation and acceptance of roles (norming), performance leading toward occasional inefficient patterns of performance (performing-I), reevaluation and transition (reforming), refocusing of efforts to produce effective performance (performing-11), and completion of team assignments (conforming). The development of a team might be recycled from any of the final stages to an earlier stage if necessitated by a failure to achieve satisfactory performance or if adjustments to environmental demands are required or if problematic team interactions develop. The core stages of the model are preceded by a pre-forming stage that recognizes the forces from the environment (environmental demands and constraints) that call for, and contribute to, the establishment of the team; that is, forces external to the team (before it comes into existence) that cause the team to be formed. The last stage indicates that after the team has served its purpose, it will eventually be disbanded or de-formed. Here. individuals exit from the group (separately or simultaneously) and the team loses its identity and ceases to exist.

The TEAM model also postulates the existence of two distinguishable activity tracks present throughout all the stages. The first of these tracks involves activities that are tied to the specific task(s) being performed. These activities include interactions of the team members with tools and machines, the technical aspects of the job (e.g., procedures, policies, etc.), and other task-related activities. The other track of activities is devoted to enhancing the quality of the interactions, interdependencies, relationships, affects, cooperation, and coordination of teams. The proponents of the model did not test its components or sequence of stages empirically but did confirm that the perceptions of team members concerning the performance processes of the team are perceived to include both team-centered and taskcentered activities and that these perceptions seem to change over time as a result of team training.

Chapter- 10

Organizational Learning

Organizational learning is an area of knowledge within organizational theory that studies models and theories about the way an organization learns and adapts. In Organizational development (OD), learning is a characteristic of an adaptive organization, i.e., an organization that is able to sense changes in signals from its environment (both internal and external) and adapt accordingly. OD specialists endeavor to assist their clients to learn from experience and incorporate the learning as feedback into the planning process.

Models Argyris and Schön were the first to propose models that facilitate organizational learning; others have followed in the tradition of their work: •

Argyris & Schön (1978) distinguished between single-loop and double-loop learning, related to Gregory Bateson's concepts of first and second order learning. In single-loop learning, individuals, groups, or organizations modify their actions according to the difference between expected and obtained outcomes. In doubleloop learning, the entities (individuals, groups or organization) question the values, assumptions and policies that led to the actions in the first place; if they are able to view and modify those, then second-order or double-loop learning has taken place. Double loop learning is the learning about single-loop learning.

•

Kim (1993), integrates Argyris, March and Olsen and another model by Kofman into a single comprehensive model; further, he analyzes all the possible breakdowns in the information flows in the model, leading to failures in organizational learning; for instance, what happens if an individual action is rejected by the organization for political or other reasons and therefore no organizational action takes place?

•

Nonaka & Takeuchi (1995) developed a four stage spiral model of organizational learning. They started by differentiating Polanyi's concept of "tacit knowledge" from "explicit knowledge" and describe a process of alternating between the two. Tacit knowledge is personal, context specific, subjective knowledge, whereas explicit knowledge is codified, systematic, formal, and easy to communicate. The

tacit knowledge of key personnel within the organization can be made explicit, codified in manuals, and incorporated into new products and processes. This process they called "externalization". The reverse process (from explicit to implicit) they call "internalization" because it involves employees internalizing an organization's formal rules, procedures, and other forms of explicit knowledge. They also use the term "socialization" to denote the sharing of tacit knowledge, and the term "combination" to denote the dissemination of codified knowledge. According to this model, knowledge creation and organizational learning take a path of socialization, externalization, combination, internalization, socialization, externalization, combination . . . etc. in an infinite spiral. Recently Nonaka returned to this theme in an attempt to move this model of knowledge conversion forwards (Nonaka & von Krogh 2009) •

Bontis, Crossan & Hulland (2002) empirically tested a model of organizational learning that encompassed both stocks and flows of knowledge across three levels of analysis: individual, team and organization. Results showed a negative and statistically significant relationship between the misalignment of stocks and flows and organizational performance.

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Flood (1999) discusses the concept of organizational learning from Peter Senge and the origins of the theory from Argyris and Schön. The author aims to "rethink" Senge's The Fifth Discipline (Senge 1990) through systems theory. The author develops the concepts by integrating them with key theorists such as Bertalanffy, Churchman, Beer, Checkland and Ackoff. Conceptualizing organizational learning in terms of structure, process, meaning, ideology and knowledge, the author provides insights into Senge within the context of the philosophy of science and the way in which systems theorists were influenced by twentieth-century advances from the classical assumptions of science.

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Imants (2003) provides theory development for organizational learning in schools within the context of teachers' professional communities as learning communities, which is compared and contrasted to teaching communities of practice. Detailed with an analysis of the paradoxes for organizational learning in schools, two mechanisms for professional development and organizational learning, (1) steering information about teaching and learning and (2) encouraging interaction among teachers and workers, are defined as critical for effective organizational learning.

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Common (2004) discusses the concept of organizational learning in a political environment to improve public policy-making. The author details the initial uncontroversial reception of organizational learning in the public sector and the development of the concept with the learning organization. Definitional problems in applying the concept to public policy are addressed, noting research in UK local government that concludes on the obstacles for organizational learning in the public sector: (1) overemphasis of the individual, (2) resistance to change and politics, (3) social learning is self-limiting, i.e. individualism, and (4) political

"blame culture." The concepts of policy learning and policy transfer are then defined with detail on the conditions for realizing organizational learning in the public sector. •

Bontis & Serenko (2009a), and Bontis & Serenko (2009b) proposed and validated a causal model explicating organizational learning processes to identify antecedents and consequences of effective human capital management practices in both for-profit and non-profit sectors. The results demonstrate that managerial leadership is a key antecedent of organizational learning, highlight the importance of employee sentiment, and emphasize the significance of knowledge management.

Organizational knowledge

Training meeting about sustainable design. The photo shows a training meeting with factory workers in a stainless steel ecodesign company from Rio de Janeiro, Brazil. These type of meeting are used to increase organizational learning Some of this knowledge can be termed technical – knowing the meaning of technical words and phrases, being able to read and make sense of data and being able to act on the basis of generalizations. Scientific knowledge is ‘propositional’; it takes the form of causal generalizations – whenever A, then B. For example, whenever water reaches the temperature of 100 degrees, it boils; whenever it boils, it turns into steam; steam generates pressure when in an enclosed space; pressure drives engines. A large part of the knowledge used by managers, however, does not assume this form. The complexities of a manager’s task are such that applying A may result in B, C, or Z. A recipe or an idea that solved very well a particular problem, may, in slightly different

circumstances backfire and lead to ever more problems. More important than knowing a whole lot of theories, recipes and solutions for a manager is to know which theory, recipe or solution to apply in a specific situation. Sometimes a manager may combine two different recipes or adapt an existing recipe with some important modification to meet a situation at hand. Managers often use knowledge in the way that a handyman will use his or her skills, the materials and tools that are at hand to meet the demands of a particular situation. Unlike an engineer who will plan carefully and scientifically his or her every action to deliver the desired outcome, such as a steam engine, a handyman is flexible and opportunistic, often using materials in unorthodox or unusual ways, and relies a lot on trial and error. This is what the French call ‘bricolage’, the resourceful and creative deployment skills and materials to meet each challenge in an original way. Rule of thumb, far from being the enemy of management, is what managers throughout the world have relied upon to inform their action. In contrast to the scientific knowledge that guides the engineer, the physician or the chemist, managers are often informed by a different type of know-how. This is sometimes referred to a ‘narrative knowledge’ or ‘experiential knowledge’, the kind of knowledge that comes from experience and resides in stories and narratives of how real people in the real world dealt with real life problems, successfully or unsuccessfully. Narrative knowledge is what we use in everyday life to deal with awkward situations, as parents, as consumers, as patients and so forth. We seek the stories of people in the same situation as ourselves and try to learn from them. As the Chinese proverb says "A wise man learns from experience; a wiser man learns from the experience of others." Narrative knowledge usually takes the form of organization stories. These stories enable participants to make sense of the difficulties and challenges they face; by listening to stories, members of organizations learn from each other's experiences, adapt the recipes used by others to address their own difficulties and problems. Narrative knowledge is not only the preserve of managers. Most professionals (including doctors, accountants, lawyers, business consultants and academics) rely on narrative knowledge, in addition to their specialist technical knowledge, when dealing with concrete situations as part of their work. More generally, narrative knowledge represents an endlessly mutating reservoir of ideas, recipes and stories that are traded mostly by word or mouth on the internet. They are often apocryphal and may be inaccurate or untrue - yet, they have the power to influence people's sense making and actions.

Individual learning Learning by individuals in an organizational context is the traditional domain of human resources, including activities such as: training, increasing skills, work experience, and formal education. Given that the success of any organization is founded on the knowledge of the people who work for it, these activities will and, indeed, must continue. However, individual learning is only a prerequisite to organizational learning.

Others take it farther with continuous learning. The world is orders of magnitude more dynamic than that of our parents, or even when we were young. Waves of change are crashing on us virtually one on top of another. Change has become the norm rather than the exception. Continuous learning throughout one’s career has become essential to remain relevant in the workplace. Again, necessary but not sufficient to describe organizational learning. What does it mean to say that an organization learns? Simply summing individual learning is inadequate to model organizational learning. The following definition outlines the essential difference between the two: A learning organization actively creates, captures, transfers, and mobilizes knowledge to enable it to adapt to a changing environment. Thus, the key aspect of organizational learning is the interaction that takes place among individuals. A learning organization does not rely on passive or ad hoc process in the hope that organizational learning will take place through serendipity or as a by-product of normal work. A learning organization actively promotes, facilitates, and rewards collective learning. Creating (or acquiring) knowledge can be an individual or group activity. However, this is normally a small-scale, isolated activity steeped in the jargon and methods of knowledge workers. As first stated by Lucilius in the 1st century BC, “Knowledge is not knowledge until someone else knows that one knows.” Capturing individual learning is the first step to making it useful to an organization. There are many methods for capturing knowledge and experience, such as publications, activity reports, lessons learned, interviews, and presentations. Capturing includes organizing knowledge in ways that people can find it; multiple structures facilitate searches regardless of the user’s perspective (e.g., who, what, when, where, why,and how). Capturing also includes storage in repositories, databases, or libraries to ensure that the knowledge will be available when and as needed. Transferring knowledge requires that it be accessible to as needed. In a digital world, this involves browser-activated search engines to find what one is looking for. A way to retrieve content is also needed, which requires a communication and network infrastructure. Tacit knowledge may be shared through communities of practice or consulting experts. Knowledge needs to be presented in a way that users can understand it, and it must suit the needs of the user to be accepted and internalized. Mobilizing knowledge involves integrating and using relevant knowledge from many, often diverse, sources to solve a problem or address an issue. Integration requires interoperability standards among various repositories. Using knowledge may be through simple reuse of existing solutions that have worked previously. It may also come through adapting old solutions to new problems. Conversely, a learning organization learns from mistakes or recognizes when old solutions no longer apply. Use may also be through synthesis; that is creating a broader meaning or a deeper level of understanding. Clearly,

the more rapidly knowledge can be mobilized and used, the more competitive an organization. An organization must learn so that it can adapt to a changing environment. Historically, the life-cycle of organizations typically spanned stable environments between major socioeconomic changes. Blacksmiths who didn’t become mechanics simply fell by the wayside. More recently, many Fortune 500 companies of two decades ago no longer exist. Given the ever-accelerating rate of global-scale change, the more critical learning and adaptation become to organization relevance, success, and ultimate survival. Organizational learning is a social process, involving interactions among many individuals leading to well-informed decision making. Thus, a culture that learns and adapts as part of everyday working practices is essential. Reuse must equal or exceed reinvent as a desirable behavior. Adapting an idea must be rewarded along with its initial creation. Sharing to empower the organization must supersede controlling to empower an individual. Clearly, shifting from individual to organizational learning involves a non-linear transformation. Once someone learns something, it is available for their immediate use. In contrast, organizations need to create, capture, transfer, and mobilize knowledge before it can be used. Although technology supports the latter, these are primarily social processes within a cultural environment, and cultural change, however necessary, is a particularly challenging undertaking.

Learning organization The work in Organizational Learning can be distinguished from the work on a related concept, the learning organization. This later body of work, in general, uses the theoretical findings of organizational learning (and other research in organizational development, system theory, and cognitive science) in order to prescribe specific recommendations about how to create organizations that continuously and effectively learn. This practical approach was championed by Peter Senge in his book The Fifth Discipline.

Diffusion of innovations Diffusion of innovations theory explores how and why people adopt new ideas, practices and products. It may be seen as a subset of the anthropological concept of diffusion and can help too explain how ideas are spread by individuals, social networks and organizations.

Chapter- 11

Group Behaviour

Group behaviour in sociology refers to the situations where people interact in large or small groups. The field of group dynamics deals with small groups that may reach consensus and act in a coordinated way. Groups of a large number of people in a given area may act simultaneously to achieve a goal that differs from what individuals would do acting alone (herd behaviour). A large group (a crowd or mob) is likely to show examples of group behaviour when people gathered in a given place and time act in a similar way—for example, joining a protest or march, participating in a fight or acting patriotically. Special forms of large group behaviour are: • • •

crowd "hysteria" spectators - when a group of people gathered together on purpose to participate in an event like theatre play, cinema movie, football match, a concert, etc. public - exception to the rule that the group must occupy the same physical place. People watching same channel on television may react in the same way, as they are occupying the same type of place - in front of television - although they may physically be doing this all over the world.

Group behaviour differs from mass actions which refers to people behaving similarly on a more global scale (for example, shoppers in different shops), while group behaviour refers usually to people in one place. If the group behaviour is coordinated, then it is called group action. Swarm intelligence is a special case of group behaviour, referring to the interaction between a group of agents in order to fulfil a given task. This type of group dynamics has received much attention by the soft computing community in the form of the particle swarm optimization family of algorithms.

Herd Behavior Herd behavior describes how individuals in a group can act together without planned direction. The term pertains to the behavior of animals in herds, flocks and schools, and to human conduct during activities such as stock market bubbles and crashes, street demonstrations, sporting events, religious gatherings, episodes of mob violence and even everyday decision making, judgment and opinion forming. Recently an integrated approach to herding has been proposed, describing two key issues, the mechanisms of transmission of thoughts or behavior between individuals and the patterns of connections between them. It has been suggested that bringing together diverse theoretical approaches of herding behavior illuminates the applicability of the concept to many domains, ranging from cognitive neuroscience to economics.

Herd behavior in animals A group of animals fleeing a predator shows the nature of herd behavior. In 1971, in the oft cited article "Geometry For The Selfish Herd," evolutionary biologist W. D. Hamilton asserted that each individual group member reduces the danger to itself by moving as close as possible to the center of the fleeing group. Thus the herd appears as a unit in moving together, but its function emerges from the uncoordinated behavior of selfserving individuals.

Symmetry breaking in herding behavior Asymmetric aggregation of animals under panic conditions has been observed in many species, including humans, mice, and ants. Theoretical models have demonstrated symmetry breaking similar to observations in scientific studies. For example when panicked individuals are confined to a room with two equal and equidistant exits, a majority will favor one exit while the minority will favor the other.

Possible mechanisms • • •

Hamilton’s Selfish Herd Theory. Byproduct of communication skill of social animal or runaway positive feedback. Neighbor copying.

Escape panic characteristics • • • • • •

Individuals attempt to move faster than normal. Interactions between individuals become physical. Exits become arched and clogged. Escape is slowed by fallen individuals serving as obstacles. Individuals display a tendency towards mass or copied behavior. Alternative or less used exits are overlooked.

Herd behavior in human societies The philosophers Søren Kierkegaard and Friedrich Nietzsche were among the first to critique what they referred to as "the crowd" (Kierkegaard) and "herd morality" and the "herd instinct" (Nietzsche) in human society. Modern psychological and economic research has identified herd behavior in humans to explain the phenomena of large numbers of people acting in the same way at the same time. The British surgeon Wilfred Trotter popularized the "herd behavior" phrase in his book, Instincts of the Herd in Peace and War (1914). In The Theory of the Leisure Class, Thorstein Veblen explained economic behavior in terms of social influences such as "emulation," where some members of a group mimic other members of higher status. In "The Metropolis and Mental Life" (1903), early sociologist George Simmel referred to the "impulse to sociability in man", and sought to describe "the forms of association by which a mere sum of separate individuals are made into a 'society' ". Other social scientists explored behaviors related to herding, such as Freud (crowd psychology), Carl Jung (collective unconscious), and Gustave Le Bon (the popular mind). Swarm theory observed in nonhuman societies is a related concept and is being explored as it occurs in human society.

Stock market bubbles Large stock market trends often begin and end with periods of frenzied buying (bubbles) or selling (crashes). Many observers cite these episodes as clear examples of herding behavior that is irrational and driven by emotion—greed in the bubbles, fear in the crashes. Individual investors join the crowd of others in a rush to get in or out of the market. Some followers of the technical analysis school of investing see the herding behavior of investors as an example of extreme market sentiment. The academic study of behavioral finance has identified herding in the collective irrationality of investors, particularly the work of Robert Shiller, and Nobel laureates Vernon Smith, Amos Tversky, and Daniel Kahneman. Hey and Morone (2004) analyzed a model of herd behavior in a market context. Their work is related to at least two important strands of literature. The first of these strands is that on herd behavior in a non-market context. The seminal references are Banerjee (1992) and Bikhchandani, Hirshleifer and Welch (1992), both of which showed that herd behavior may result from private information not publicly shared. More specifically, both of these papers showed that individuals, acting sequentially on the basis of private information and public knowledge about the behavior of others, may end up choosing the socially undesirable option. The second of the strands of literature motivating this paper is that of information aggregation in market contexts. A very early reference is the classic paper by Grossman and Stiglitz (1976) that showed that uninformed traders in a market context can become informed through the price in such a way that private information is aggregated correctly and efficiently. A summary of the progress of this strand of literature can be found in the paper by Plott (2000). Hey and Morone (2004) showed that it is possible to observe herd-type behavior in a market context. Their result is even more

interesting since it refers to a market with a well-defined fundamental value. Even if herd behavior might only be observed rarely, this has important consequences for a whole range of real markets – most particularly foreign exchange markets. One such herdish incident was the price volatility that surrounded the 2007 Uranium bubble, which started with flooding of the Cigar Lake Mine in Saskatchewan, during the year 2006.

Behavior in crowds Crowds that gather on behalf of a grievance can involve herding behavior that turns violent, particularly when confronted by an opposing ethnic or racial group. The Los Angeles riots of 1992, New York Draft Riots and Tulsa Race Riot are notorious in U.S. history, but those episodes are dwarfed by the scale of violence and death during the Partition of India. Population exchanges between India and Pakistan brought millions of migrating Hindus and Muslims into proximity; the ensuing violence produced an estimated death toll of between 200,000 and one million. The idea of a "group mind" or "mob behavior" was put forward by the French social psychologists Gabriel Tarde and Gustave Le Bon. Sporting events can also produce violent episodes of herd behavior. The most violent single riot in history may be the sixth-century Nika riots in Constantinople, precipitated by partisan factions attending the chariot races. The football hooliganism of the 1980s was a well-publicized, latter-day example of sports violence.

Everyday decision-making Benign herding behaviors may be frequent in everyday decisions based on learning from the information of others, as when a person on the street decides which of two restaurants to dine in. Suppose that both look appealing, but both are empty because it is early evening; so at random, this person chooses restaurant A. Soon a couple walks down the same street in search of a place to eat. They see that restaurant A has customers while B is empty, and choose A on the assumption that having customers makes it the better choice. And so on with other passersby into the evening, with restaurant A doing more business that night than B. This phenomenon is also referred as an information cascade.