Organizational Theory

"In recent years economists and historians have increasingly turned their attention to modern economic institutions. Economists such as Edward S. Mason, A. D. H. Kaplan, John Kenneth Galbraith, Oliver E. Williamson, William J. Baumol, Robin L. Marris, Edith T. Penrose, Robert T. Averitt, and R. Joseph Monsen, following the pioneering work of Adolph A. Berle, Jr., and Gardiner C. Means, have studied the operations and actions of modern business enterprise. They have not attempted, however, to examine its historical development, nor has their work yet had a major impact on economic theory. The firm remains essentially a unit of production, and the theory of the firm a theory of production."

"Job satisfaction is typically defined as an employee’s level of positive affect toward his or her job or job situation... Along with positive affect, we can add both a cognitive and a behavioral component to this definition... The cognitive aspect of job satisfaction represents an employee’s beliefs about his or her job or job situation; that is, an employee may believe that his or her job is interesting, stimulating, dull, or demanding—to name a few options... The behavioral component represents an employee’s behaviors or, more often, behavioral tendencies toward his or her job. An employee’s level of job satisfaction may be revealed by the fact that he or she tries to attend work regularly, works hard, and intends to remain a member of the organization for a long period of time."

"There is a great variety of measures of job attitudes. Basically, however, the identification of job attitudes has been done in three ways. In the first of these the worker is asked to express his "job satisfaction" directly by answering questions that investigate his over-all attitude toward his job, whether he likes or dislikes it."

"Every piece of data suggests that workplaces are in dire shape and there is low levels of trust in leaders. For instance, data on employee engagement from Gallup show that worldwide only about 13% of employees report being engaged with their work, and in the U.S., the number is barely higher at 20%. Job satisfaction has declined almost linearly since 1987 to the present. The Edelman Trust index indicates that the public at large has low trust in leaders, while other surveys show that employees do not expect their own leaders to make ethical decisions or to consistently tell them the truth about difficult situations."

"It is probable that when future historians of economic thought look back over this century, the thirties will appear as an era of rapid development in economic theory. Not only has there been unusual activity in monetary theory, theory of value. but extensive transformations have also been made in the basic theory of value. The outstanding publications in this field are, of course, Joan Robinson's Theory of Imperfect Competition and Chamberlin's Theory of Monopolistic Competition, the first produced in Cambridge, England, and the second in Cambridge, Massachusetts. These volumes mark the explicit recognition of the theory of the firm as an integral division of economic analysis upon which rests the whole fabric of equilibrium theory. General equilibrium is nothing more than the problem of the interaction of individual economic organisms, under various conditions and assumptions; as a necessary preliminary to its solution, an adequate theory of the individual organism itself is necessary."

"The stress on 'human resources' as an organizational asset goes back at least to Drucker (1954). This was elaborated in the theory of 'human capital' by Schultz (1963) who was concerned to describe the benefits of education as a 'production good' enhancing the economic resources of society, and by others like Becker (1964) who argued for the benefits to economic growth of a well-trained workforce. While labour market segmentation theory developed in reaction (stressing institutional processes in labour market formation), human asset accounting in the 1970s applied the capital theory to quantifying investments in people by the organization (Flamholtz, 1974). This was embraced by some (for example, Likert, 1967) as a way of encouraging humane employment policies, less geared to the short-term (although others saw in it the rule of accountants)."

"We have already mentioned what may, perhaps, appear paradoxical to some of our readers, — that the division of labour can be applied with equal success to mental as to mechanical operations, and that it ensures in both the same economy of time."

"The product of mental labor — science — always stands far below its value, because the labor-time necessary to reproduce it has no relation at all to the labor-time required for its original production."

"I now proceed to open up unto you the three great powers with which God has endowed Man, whereby Man has become fully capable to labour, to the fulfilling the destiny whereunto God has appointed him. These are :—Powers of mind, or genius; powers of intellect, or knowledge ; and powers of body, health and strength ; otherwise mental, intellectual, and physical. As Time is the basis, so these three powers are the foundation stones of all useful labour. If one or other of these powers be wanting in any social system, there can be‘no‘ completion or perfection of labour. Now, Sir, mental labour can only be performed by the mind whom God has gifted ‘with genius—‘a power so evidently of divine origin, so beyond man to give or take away; a power flowing forth from the inward thought, calling up on the retina of the mental vision scenes of surpassing beauty, phrases of the most truthful perfect‘ness, harmonies of the highest cadence. Would that I could say that although it is not in Man to create this power, it was also not in him to abuse it. Yet great as this power is, mental labour is but the creation of ideas."

"The boot and shoe makers, either as shoemakers or “cordwainers,” have been the earliest and the most strenuous of American industrialists in their economic struggles. A highly skilled and intelligent class of tradesmen, widely scattered, easily menaced by commercial and industrial changes, they have resorted with determination at each new menace to the refuge of protective organizations."

"Recognizing our responsibilities as industrialists, we will devote ourselves to the progress and development of society and the well-being of people through our business activities, thereby enhancing the quality of life throughout the world."

"[ Bill Gates is ] probably the most dangerous and powerful industrialist of our age."

"Just as modern man consumes both too many calories and calories of no nutritional value, information workers eat data both in excess and from the wrong sources."

"Even the most unsympathetic and unenlightened politician, industrialist or bureaucrat begins to take notice when a lot of people write about the same subject."

"This new knowledge economy will rely heavily on knowledge workers. ...the most striking growth will be in “knowledge technologists:” computer technicians, software designers, analysts in clinical labs, manufacturing technologists, paralegals. ...They are not, as a rule, much better paid than traditional skilled workers, but they see themselves as “professionals.” Just as unskilled manual workers in manufacturing were the dominant social and political force in the 20th century, knowledge technologists are likely to become the dominant social—-and perhaps also political—-force over the next decades."

"Knowledge workers have high degrees of expertise, education, or experience, and the primary purpose of their jobs involves the creation, distribution or application of knowledge."

"The knowledge worker is paid extremely well. He gets to do interesting work. Yet no group is more subject to job dissatisfaction and "alienation." Why? Direct production workers — machinists, bricklayers, farmers — are a steadily declining portion of the work force in a developed economy. consists of “knowledge workers” — accountants, engineers, social workers, nurses, computer experts of all kinds, teachers and researchers. And the fastest growing group among knowledge workers themselves are managers. People who are paid for putting knowledge to work rather than brawn or manual skill are today the largest single group in the American labor force — and the most expensive one. The incomes of these people are not, as a rule, determined either by supply or demand or by their productivity. Their wages and fringe benefits go up in step with those of manual direct-production workers."

"In the United States, the "knowledge worker" values his or her independence. This is translated into the desire to have personal databases, some influence in how work is performed, as well as control of environmental features such as lighting and s."

"This society in which knowledge workers dominate is in danger of a new "class conflict" between the large minority of knowledge workers and the majority of workers who will make their livings through traditional ways, either by manual work... or by service work. The productivity of knowledge work - still abysmally low - will predictably become the economic challenge of the knowledge society. On it will depend the ability of the knowledge society to give decent incomes, and with them dignity and status, to non knowledge people."

"A related difficulty arises in the managerial training process because the educational system cannot at present entice those with the most creative abilities into such careers; Galbraith refers to this as the problem of "reproducing the technostructure." Similarly, Drucker maintains that the determination of the social status of the "knowledge worker" will present the developed societies with their most significant social question in the coming decades."

"To make the right decision the knowledge-worker must know what performance and results are needed... He cannot be supervised. He must direct, manage and motivate himself."

"In The Organization of the Future, the contributors show... how organizations need to support work-life balance and provide flexibility to knowledge workers"

"In recent years many scattered attempts have been made to apply physiology and psychology to economic processes. Business men by scientific observation and experiment have brought criticism to bear upon the traditional and empirical modes of organising and conducting ... more recently the detailed technology of manual and mental labour has been made material of physiological and psychological investigation."

"What we will need from now on are, increasingly, "effectiveness centers"', that is, organized efforts to make fully effective and productive the new workers, the knowledge worker, the employed middle-class professional."

"The term division of labor has, from long usage, become associated in the public mind with manual processes. But productive labor is, in general, both manual and mental and just as there may be division of manual labor so there may be division of mental labor or division of thought. Modern productive methods tend constantly to separate mental labor from manual labor and then to subdivide each into smaller and smaller parts. The subdivision of manual labor is greatly furthered, as has been seen, by the extended use of tools. Subdivision of mental labor on the other hand is hastened by an increase in the amount of knowledge and mental development necessary to successfully perform the work in hand. Thus the mental labor of designing machinery is performed largely apart from the actual production; and this mental labor has become very closely specialized as the scientific basis of engineering has grown. This process of subdivision is greatly hastened in both manual and mental operations by increased quantity since this, of itself, enables the manager to avail himself of the inherent advantages of division of labor already discussed."

"The most important contribution of management in the 20th century was to increase manual worker productivity fifty-fold. The most important contribution of management in the 21st century will be to increase knowledge worker productivity—hopefully by the same percentage. So far it is abysmally low and in many areas (hospital nurses, for instance, or design engineers in the automobile industry) actually lower than it was 70 years ago. So far, almost no one has addressed it. Yet we know how to increase—and rapidly—the productivity of knowledge workers. The methods, however, are totally different from those that increased the productivity of manual workers."

"ON THE EFFECTS PRODUCED ON THE BLOOD BY MENTAL LABOUR. BY THEOPHILUS THOMPSON, M.D., F.R.S."

"The person who merely watches the flight of a bird gathers the impression that the bird has nothing to think of but the flapping of its wings. As a matter of fact this is a very small part of its mental labor. To even mention all the things the bird must constantly keep in mind in order to fly securely through the air would take a considerable part of the evening."

"Linear programming is viewed as a revolutionary development giving man the ability to state general objectives and to find, by means of the simplex method, optimal policy decisions for a broad class of practical decision problems of great complexity. In the real world, planning tends to be ad hoc because of the many special-interest groups with their multiple objectives."

"Pascal is called the founder of modern probability theory. He earns this title not only for the familiar correspondence with Fermat on games of chance, but also for his conception of decision theory, and because he was an instrument in the demolition of probabilism, a doctrine which would have precluded rational probability theory."

""Interactive Decision Theory" would perhaps be a more descriptive name for the discipline usually called Game Theory."

"The researcher hoping to break new ground in the theory of experimental design should involve himself in the design of actual experiments. The investigator who hopes to revolutionize decision theory should observe and take part in the making of important decisions."

"Decision theory can be pursued not only for the purposes of building foundations for political economy, or of understanding and explaining phenomena that are in themselves intrinsically interesting, but also for the purpose of offering direct advice to business and governmental decision makers. For reasons not clear to me, this territory was very sparsely settled prior to World War II. Such inhabitants as it had were mainly industrial engineers, students of public administration, and specialists in business functions, none of whom especially identified themselves with the economic sciences..."

"Decision theory, as it has grown up in recent years, is a formalization of the problems involved in making optimal choices. In a certain sense — a very abstract sense, to be sure — it incorporates among others operations research, theoretical economics, and wide areas of statistics, among others."

"As industrial processes involve specialized skill and expert technical training, made effective by intelligent co-ordination, it is clear that a humanly efficient Industrial Democracy necessitates leadership by those who possess the requisite knowledge, skill, and technical training."

"Technocracy originated in the winter of 1918-19 when Howard Scott formed a group of scientists, engineers, and economists that became known as the --a research organization. Howard Scott was chief engineer of this group. The Alliance lasted about fourteen years. Its membership embraced many of America's top scientists and engineers, including such personalities as: Frederick Ackerman, architect; , statistician; Thorstein Veblen, economist; L. K. Comstock, electrical engineer, and Charles Steinmetz. It conducted what became known as the famous 'Energy Survey of North America.' Out of the survey, and under the guiding genius of Howard Scott, there emerged a completely new way of looking at life and human affairs. The social assets and liabilities (in a physical sense) of North America were laid bare for the first time. The social trends and tendencies were analyzed scientifically and for the first time in history a continental area (North America) had a glimpse of its future, or at least of the broad alternatives."

"When a Nation - exercising its freedom of choice - discards Autocracy and selects Democracy as its social principle it cannot successfully retain the working elements of the discarded social organization. If it is to survive, it must adopt ways and means and methods of life in consonance with its chosen principle."

"Technocratic human beings are spiritually alive. Their objective is to fully utilize our technological capabilities for the great benefit to ALL by freeing up existing infinite regenerating energy resources that we all depend on for our survival in harmonious accord with natures laws without any kind of LEGAL fiction and or financial fairy-tale interfering with the process of production and distribution of all that we require to sustain our lives. Genuine technocrats realize that free and abundant energy means free people and the reality of freedom for ALL people is essential for solving our worlds most complex social problems."

"When we turn to the regime of international trade law, as it has emerged in the post–Second World War era, we find an intellectual or conceptual foundation that, to be sure, assumes and assimilates the classic insights about the gains to wealth and welfare from free trade but is fundamentally concerned with the interdependency of different states’ trade and other economic policies—i.e., managing or constraining the external costs that states impose on other states by virtue of their policies. A paramount goal is the avoidance of a protectionist summum malum—the situation where domestic social or economic pressures lead some states to increase or reinstate barriers to trade, thus triggering a competitive reaction in kind by other states, and eventually a “race to the bottom” that is disastrous for the global economy. This sort of behavior was widely perceived by the founders of the Bretton Woods system to have led eventually to perilous instability in the interstate system and economic catastrophe in the interwar years—which phenomena were seen as having contributed to the climate that made fascism, and the Second World War itself, possible."

"The term "technocracy" has a different popular connotation in France than in the United States largely because of contrasting past experiences. Our view is strongly marked by the fanciful scheme popularized by the eccentric intellectual, Howard Scott, during the depression. Although the French imported the term "technocracy" from Scott's movement, they grafted it on to an older and more respected tradition of thought and practice. Modern technocratic doctrine in France dates back to the Comte de Saint-Simon, the early prophet of industrialism."

"[Technocracy is] a system of governance in which technically trained experts rule by virtue of their specialized knowledge and position in dominant political and economic institutions."

"No technique is possible when men are free. When technique enters into the realm of social life, it collides ceaselessly with the human being to the degree that the combination of man and technique is unavoidable, and that technical action necessarily results in a determined result. Technique requires predictability and, no less, exactness of prediction. It is necessary, then, that technique prevail over the human being. For technique, this is a matter of life or death. Technique must reduce man to a technical animal, the king of the slaves of technique. Human caprice crumbles before this necessity; there can be no human autonomy in the face of technical autonomy. The individual must be fashioned by techniques, either negatively (by the techniques of understanding man) or positively (by the adaptation of man to the technical framework), in order to wipe out the blots his personal determination introduces into the perfect design of the organization."

"This book describes the role of technological experts and expertise in a democratic society. It places decision-making strategies - studied in organization theory and policy studies - into a political context. Fischer brings theory to bear on the practical technocratic concerns of these disciplines and hopes to facilitate the development of nontechnocratic discourse within these fields. The book adopts a critical perspective and addresses the restructuring of the policy sciences."

"As Antonio Gramsci recognized in his prison reflections from the end of the 1920s, the impact of United States technology offered a valuable key for understanding recent European development:'The European reaction to Americanism... must be examined attentively. Analysis of it will provide more than one element necessary for understanding the present situation of a series of states of the old continent and the political events of the post-war period."

"Hacker: How many people do we have in this department?"

"Genuine alternatives to existing social organizations seldom appear viable except in times of rapid cultural transformation or crisis. The Great Depression was such a crisis. The valley and the shadow of the depression sorely tempted the country to reject its beliefs and principles. The faith that the twenties had placed in big business and the free marketplace seemed an illusion. At least until the New Deal, representative politics offered little constructive help to those victimized by economic events beyond their control. Traditional culture, with its emphasis on the individual, the local community, and Protestant virtues, had been found wanting previously. Americans might be nostalgic about the cultural values of the past, but reversion to them was hardly likely. The crisis demanded new ways of viewing and organizing society, a new set of values."

"Scientific management is not any efficiency device, not a device of any kind for securing efficiency; nor is it may bunch or group of efficiency devices. It is not a new system of figuring costs; it is not a new scheme of paying men; it is not a piece work system; it is not a bonus system; it is not a premium system; it is no scheme for paying men; it is not holding a stopwatch on a man and writing things down about him; it is not time study; it is not a motion study, not an analysis of the movements of men; it is not the printing and loading & unloading of a ton or two of blanks on a set of men and saying "Here's your system; go and use it". It is not divided foremanship or functional foremanship; it is not any of the devices which the average man calls to mind when scientific management is spoken of."

"The original technocrats offered a seemingly scientific explanation of explanation of Americas ills and increasingly moved toward proposing radical solutions. At the center of their view of America was the paradox of a society victimized by abundance and by technology. The march of science, invention, engineering, and their offspring — the machine and modern technology — possessed the potential for a material utopia. Instead, the workings of the machine operating within the traditional economic framework had brought the depression."

"Time study is the art of recording, analyzing, and synthesizing the time of the elements of any operation, usually a manual operation, but it has also been extended to mental and machinery operations."

"Motion study is the science of eliminating wastefulness resulting from using unnecessary, ill-directed, and inefficient motions. The aim of motion study is to find and perpetuate the scheme of least waste methods of labor."