Management 1 PDF

CHAPTER 1 The Empirical Material of Organizational Analysis Organization theory can be said to discuss not only how different functions are coordinated, but also how they can and should be coordinated For an activity to be coordinated, it must be divided and specialized into differen...

CHAPTER 1 The Empirical Material of Organizational Analysis Organization theory can be said to discuss not only how different functions are coordinated, but also how they can and should be coordinated For an activity to be coordinated, it must be divided and specialized into different activities. Organization theory is as much about division of labor as about coordination of labor. Critical Thinking, Theoretical Pluralism and Multi-frame Analysis A critical thinker (reflective practitioner) is usually conceptualized as an individual person, not getting stuck in old trains of thought, but having the ability to discover and interpret new information, and to think and act creatively. The assumption that successful management and leadership create innovative organizations is taken for granted. We often overlook other fundamental functions required in all organizations, namely stabilizing, disciplining, and controlling human behavior. If an organization reacted to everything, it would lose ability to invest, develop and create added value. Theoretical pluralism is an approach that recognizes and values multiple, often diverse, theoretical perspectives or frameworks when analyzing a phenomenon or solving a problem. Rather than adhering strictly to a single theory, theoretical pluralism advocates for using a range of theories to provide a more comprehensive understanding.  Can be used for analyzing everything o As everything has different interpretations There is no established knowledge mass that is absolutely true. There will be models that oppose each other, so that’s why analysis using both is important for that understanding. Organization Theory’s two fundamental functions: To offer specific analytical tools in the form of models and concepts, which can be applied to analyze and increase understanding of any organizational phenomena. To offer several theoretical frameworks, which replace, complement or re-frame common-sense thinking. *Essentially, one is analyzing organizations, and the other is understanding the process through frameworks. Three Types of Critical Thinking 1. Thinking Freely Doesn't exist alone as experiences vastly influence our thoughts However, self-criticism is important for analysis of this thought process. 2. Technical Single-frame Analysis Using theory, or other information from others as sources for critical thinking Problem: Theory choice, bias, re-framing difficult (we like to study from what we know). 3. Theoretical Pluralism and Multi-frame Analysis Analyzing through multiple frameworks and models Analyze via the framework you are not sure about to go against bias. (Of course use all) The Four Frameworks on Management, Organization and Leadership (Bolman and Deal) The Structural Framework Type of modern framework Is an organizational analysis based on whether we have chosen to formalize and structure processes in an appropriate manner. Close link to homo economicus The HR Framework Type of modern framework Is about how the needs of the organization and the employees fit together o Employees are assumed to naturally like to work, just as children like to play, given that they are allowed to work/play (homo ludens). If employees are given interesting work tasks, they will become motivated to work hard. According to the HR framework, motivated employees are a prerequisite for efficient operations. The Power Framework Contemporary All organizational processes, goals, and solutions are products of political processes between actors with different or conflicting interests. The framework assumes that human beings are always striving to increase their powers (homo potestas). The Symbolic Framework Contemporary Within a symbolic framework, the human being is neither rational, selfish, caring nor power-driven. They are what the social context makes them into (homo socialis). Human being seeks meaning (basic assumption) It is about understanding how symbols express, create, and recreate meaning and organizational culture. What can be seen as a problem in one framework, can be a solution in another. Chapter 2 Structures, Formalized Processes and Rational Decisions – The Basics of the Structural Framework THE HISTORY The oldest framework Max Weber’s formal-rational bureaucracy is characterized by the following principles 1. An established division of labor among staff 2. Coordination via an authority and responsibility hierarchy 3. Generally valid rules that determine different work tasks and rewards 4. A clear distinction between personal and official property and responsibility 5. Recruitment and promotion of staff on the basis of formal qualifications 6. Full employment and established career paths 7. A full-time job with a sufficient wage to live on. THE BASIC ASSUMPTIONS OF THE STRUCTURAL FRAMEWORK Organizations exist because they are efficient tools to achieve established goals. Well-advanced division of labor/specialization leads to efficiency. Coordination is best achieved through vertical hierarchical control (‘top down’) and formalized processes/structures People are motivated to work through material rewards (pay), clear and formalized work descriptions (information/rules), and control. Optimal processes and structures are rationally designed based on objective/material conditions – by studying and analyzing facts, efficient organizations can be designed. Inefficiency arises due to incorrectly or ambiguously designed processes and structures, and is addressed by means of restructuring EFFICIENCY Efficiency - Internal efficiency is the measure of the amount of resources needed to achieve something. (Focus on interna efficiency can be described as production orientation) Effectiveness – External efficiency is about how many resources are needed to produce something that is in demand (Internal efficiency + demand). Doesn’t matter how many hours it takes to make a car, if no one is buying it  If efficiency is to do something right, effectiveness is to do the right thing. System efficiency Includes both efficiency and effectiveness but adds a time or change dimension It is the measure of how quickly and efficiently activities can be adjusted when demand changes. Flow Efficiency Like system efficiency but the time factor is emphasized. Flow efficiency is defined as the ratio between valued-adding time (i.e. the time spent actively working towards the completion of a task) and lead time (that is, the time it takes from an order being placed to it being delivered to the customer). The capacity to adjust (such as create a new manufacturing process) is the most important when it comes to efficiency and especially effectiveness, in flow efficiency. Division of Labor Division of Labor Based on Function Division of Labor Based on Product Diversification in labor based on product line Division of Labor Based on Customer and Market Dividing labor for product design and manufacturing based on different types of customers. Division of Labor Based on Location Different locations have different conditions for efficient production (skillset, etc.) Division of Labor Based on Time Seasonal factors, time of day, etc. Division of Labor Based on Process  Work should follow a flow of gradually adding value to the product or service. Division of Labor Based on Projects Delimiting resources in time and space to reach a specific goal (each project is allocated the resources needed to achieve the goals for that particular project) Coordination From a structural perspective, it is always efficient to have specialized activities as much as possible, as well as to coordinate the specialized working tasks with formalized rules, processes and physical structures. People at the top should have more qualifications; thus, having more say in decisions (meritocratic system). Vertical Coordination and Control Is about the higher, hierarchical levels defining and controlling what the lower levels do. Direct control – direct order to subordinates Bureaucratic control – can range from detailed employment contracts and job descriptions to formalized process instructions and incentive structures in the form of payroll systems. These structures set limits on what employees are able to do, and thus somewhat controls their actions. Horizontal Coordination and Control Horizontal coordination and control, in principle, mean that people on the same hierarchical level interact with each other and decide what to do together, without giving a higher-level manager more right of determination. An Initial Simple Model 1. To what extent is our current organization characterized by specialization and vertical coordination? That is, where on the scale of the model are we? 2. To what extent is our organization, including its environment, characterized by stability and predictability versus changeability and uncertainty? That is, where in the model should we be? If you are where you should be, the analysis explains why things are going well. You have efficient structures, given the level of uncertainty that characterizes the organization and its environment. If you are not where you should be, it indicates that there are problems that can be addressed through the reorganization of structures and processes. If the uncertainty of the organization and/or its environment increases, care should be exercised when investing in formal structures, formalized processes and greater division of labor. On the other hand, if an increasingly stable and predictable market is detectable, and there are opportunities to modularize and produce similar goods or services, then efficiency increases if you structure, systematize and formalize, or, in other words, ‘set the processes'. Uncertainty Mintzberg’s Structural Configurations In order to facilitate the choice of efficient organizational form, that is, how to divide labor and coordinate, Mintzberg (1983) developed a typology consisting of five ‘pure’ structural configurations. With the help of Mintzberg's typology, more were developed and nuanced conclusions can be drawn on the type of structure and processes that are most effective in a given situation. The five configurations – machine bureaucracy, professional bureaucracy, simple structure, adhocracy and divisionalized form Strategic apex – highest management group in real-life organizations Middle management – managers Operational core – core processes and labor of an organization, such as teachers at a school, or servers and cooks at a restaurant. Technostructure - covers both the governing physical or formal structures and the people who design them. In other words, technostructure includes the staff function that, at the behest of the management, designs the new factory layout and its conveyor belts, for example, or the updated formal project model that everyone should use in their tasks. Support functions - lend their support to operational core activities rather than control them. A corporate staff restaurant, its payroll administration, free fruit and health care are relatively clear examples of support functions Structural Configurations  Vertical coordination; many hierarchical levles and a developed technostructure. Counteracts arbitrariness, favoritism, and irrational decisions. Unnecessary for small companies (coordination is horizontal) or uncertain environments. In summary, machine bureaucracy has well-developed formalized processes and hierarchical structures with extensive specialization, large technostructure and vertical coordination. Its primary strength is efficiency and its biggest weakness is inertia. In professional bureaucracy, instead of by means of a developed technostructure and hierarchical levels, much of the organization is coordinated by the profession itself. (coordination easy on horizontal scale) Difficult to make changes affecting the set profession (such as pilots, professors, etc.) Strong and dominant manager can be positive in small areas, as agile and one vision, but difficult to notice innovation and change. Coordinated horizontally; self-organizing. In organizations where new products and technologies are developed, or which do extensive and complex customizations of existing components, adhocracy is often appropriate. Typical activities where adhocratic organization is suitable are research and development as well as temporary or time-limited activities such as projects, programs, assignments and investigations. Should be governed by constraints: a cost budget, targets, or outside interests. Certain departments can be shared, if they have the necessary functions that work in all branches. Comparison and configuration of resources across divisions can create competition between divisions, which can cause risks, such as short-sightedness and conflict. Dimensions and Situational Dependencies One way to analyze a specific activity in order to answer the question of how best to organize it is to compare it with Mintzberg's five structural configurations. If it is a question of a large organization in a stable environment, simple structure or adhocracy are probably not the best configurations. If it is a question of a very complex activity in an uncertain environment, machine bureaucracy is probably not suitable. And so on. By comparing the studied activity with all five configurations, a reasonably normative response can be achieved. Analysis can be separated into descriptive and normative (value based; how it ought to be). Dimensions and Situational Dependencies help us choose what type of configuration we should use or have. The descriptive part of the analysis should analyze what structural configuration we are using and what dependencies we have The normative part of the analysis should analyze what structural configuration we ought to use and what dependencies we need to improve on, which are used to determine the type of configuration. Central Processes Note: The central processes dimension consists of uncertainty in the production of goods and services, in regards to both the complexity of the product itself and the manufacturing process. Developing next-generation passenger aircraft is a technically complicated process. Flying and maintaining such an aircraft may not be as complex. Selling tickets, receiving and filling planes with passengers, luggage, fuel and crew, and taking off and landing are even less complex, and can be both planned and structured using formalized processes. Environment: Includes laws and regulations, market, demographics,... Strategy: If you choose to conduct technically high-quality activities (high-end), instead of activities characterized by low technology content and low quality, then you should not formalize, divide labor and establish hierarchy. Alternatively, if you choose to invest in more standardized (low-end) activities, with low quality, low costs and low prices, then labor division, formalization and hierarchy should be introduced as far as possible. IT: Information technology therefore also enables a higher degree of centralized decision- making and control, and more vertical coordination, than before. In addition, profits derived from the fewer hierarchical levels and the smaller number of middle managers can be ‘eaten up’ by growing IT departments or costs for external IT support. In other words, if the number of middle managers and levels decreases, the need for technostructure and support functions increases. The general idea is that IT rationalizes, but whether it does so by means of increased decentralization and horizontal coordination, or by means of increased centralization and increased vertical control, is not entirely clear. Perhaps it occurs by means of both increased vertical and increased horizontal control? Applying Dimensions in Analysis In what configuration the organization is and should be. Matrix Organization Labor divided based on both function and project, meaning that labor is divided usually based on project groups in development of a new product for example, and in the original department. Division of labor in Matrix Organizations Labor is divided on the basis of two or more principles, such as function and product. Coordination and Control in Matrix Organizations According to the structural framework, the solution to this problem is about trying to find a clear balance between the responsibilities and powers of the two dimensions. If successful, the matrix organization makes use of the benefits of several different principles for both labor division and coordination. Ideally, for example, a matrix organization may develop new goods and services faster than purely functional organizations, while being equally efficient in its more day-to-day activities. For example, a well implemented matrix can enable an organization to quickly adapt to changing local market conditions, while, at the same time, producing products as efficiently as pure product organizations. However, failing to balance the dimensions of the matrix can cause confusion and conflict, and a time-consuming and inefficient bureaucratic superstructure can also develop. Chapter 4 Human Resources, Relations and Competence – The Basics of the HR Framework History Technological developments forced managers to treat staff better. Mary Parker Follet – first organizational theory. Elton Mayo – Hawthorne Effect – needs/attention (being attentive to employees) provides motivation and productivity. The Basic Assumptions of the HR Framework Organizations should Satisfy Human Needs The Needs of Organizations and People Must Coincide o If you want your employees to do a good job, you have to give them a good job to do. If you design workplaces and work tasks that satisfy the needs of employees, both employees and the organization will be rewarded – if you do not, both will suffer. The Human is a Complex Biological (and Social) Psychological Being o The human need for other people's friendship and appreciation, together with the desire to learn new things and develop, means that there are many more ways to motivate both managers and employees. Human Needs Maslow’s Hierarchy of Needs Abraham Maslow People must satisfy their lower need before attempting to satisfy higher needs. It does not matter how much appreciation a manager shows an employee if the salary is so low that the employee cannot live on it, or if the working hours are so long that the employee does not have time to sleep and eat. But, since people can be at different levels in the model, it can still explain why they strive in different directions and are motivated by different things. A very well-paid partner in a management consultancy may therefore be less motivated by a pay rise than temporary and low-paid staff at a fast-food chain. Herzberg’s Two-factor Theory of Motivation Internal and External Commitments According to this theory, the internal and psychological commitments are more important than the external and economic commitments. Important is balance, as leaders still exercise authoritarian and vertical control in practice, as total decentralization could cause chaos, added workload, etc. Human Relations and Communication Espoused Theories versus Theories-in-use, Single and Double-loop Learning Espoused Theory – theory that we say we believe in and say that we act upon Theory-in-use – theory we actually act upon but not necessarily say we act upon The confusion between these two leads to leaders’ ability to impeded in extensive re- framing, critical thinking, and learning. Therefore, there are two types of acquiring knowledge, if we use these ideas: Single-loop learning – self-protective and self-reinforcing learning  Double-loop learning – Challenging and perspective-breaking learning Model 1 and 2 Communication Model 1 describes ineffective communication, which Argyris says characterizes how many people, not least leaders, communicate. Model 1 communication overlaps with vertical control because, in many ways, it is about persuasion or giving orders, rather than a more equal exploratory conversation and collaboration. The latter, however, is the basis of horizontal coordination, and this type of communication – the ideal – is what Argyris calls Model 2 communication According to Argyris, managers are afraid that the costs will sky-rocket. In the short term, order-giving and structural thinking can work, while decentralization and investment in employees do not obviously pay off in the short term. Leaders may also be afraid of losing their authority. If employees start to have more autonomy and make decisions on their own, it can be difficult to see where such a development ends. Leadership Theory X and Y (McGregor’s model) Focuses on leaders and managers, and their relationships with subordinates. Managers’ assumptions about subordinates govern how leaders act in and interpret their surroundings. Leaders’ actions are, in turn, interpreted by their subordinates, who act on the basis of their interpretations, and leaders interpret this and act, and so on. Leaders’ different assumptions therefore create different patterns of behavior in both the leaders themselves and their employees. Theory X According to the HR model there are two types: Hard (control) and soft (rewards) o Both have share of problems, as too much control can demotivate o While rewards can decrease commitment over time Self-fulfilling (actions of leader cause action of employees, which causes actions of leaders, and so on) Model 1 communication Theory Y Employees given influence and responsibility, with room to grow Self-fulfilling, if done right Model 2 communication An analysis of a particular business or organization from an HR framework perspective should thus include both analysis of whether the organization satisfies the needs of its employees, and analysis of how its leaders and employees communicate, as well as of what view of employees’ leaders express in their statements and actions. Intelligence – IQ vs EQ Intelligence (IQ) - Analytical, rational (homo economicus) Emotional Intelligence (EQ) - emotional talent Skills of EQ o Self-awareness – understanding yourself and how your feelings and effects, affect others when making decisions. o Self-regulation – being able to control feelings and adapt to changing circumstances o Social skills – being able to control your relationships to influence people in the desired direction o Empathy – being able to recognize and consider other people’s feelings o Motivation – wanting to perform for performance’s sake Determines how leaders act and interact (usually higher EQ more important) Organization of Work Job Characteristics Model Hackman’s and Oldham’s Workplace and tasks should be designed so that each employee can: 1. Feel the work is meaningful 2. Feel responsible for it 3. See how it contributes to the results of the business. To achieve (above): 1. Skill variety – Employees can use different skills at different times; not the same repetitive process 2. Task identity - work tasks should be designed so that employees feel that they can identify with them. For example, if different teams are responsible for the maintenance of bus stops on different streets, instead of one person emptying the  trash cans at all bus stops, one changing timetables at all stops, another replacing broken glass panes at all stops, and so on, the teams will be able to identify with the bus stops on ‘our street’ and feel pride if they give a complete, clean and pleasant impression. 3. Task significance – Significance of task clearly communicated 4. Autonomy – The more autonomy in tasks and how they should be performed, the greater the sense of responsibility 5. Feedback – The more feedback employees receive about how the work of the individual or group affects the performance of the business or organization (productivity, profitability, innovation or other measures), the more knowledgeable they will be about how they can contribute to this result How they differently achieve efficiencies Competence Strategies Hansson – different competence strategies are appropriate in different situations. Basic idea: An organization’s human resource and competence strategies must be in line with its business idea and competitive strategy. o This means that not everything is about maximizing employees’ work motivation but rather about having to adapt how employees are managed according to the type of business being conducted. Attitude to business development (how developing product idea) Attitude to employees (viewing employees as: ) Four Competence Strategies (IRL mixture of all or some) Molding Marketing plan or market strategy o Governed by customer requirements  o Learning takes place in the form of clear working tasks and training initiatives Appropriate for cost-leadership strategy o Recruiting the right staff o Cheap staff o Systematic introduction to and training for the job in question o Result: ▪ Strong culture, homogeneous staff group o Limitations ▪ Dynamic markets not suitable, high amount of competition Therefore, market analysis and strategy take precedence over competence strategy Matching Involves taking into account employees’ ambitions and competencies as well as customer requirements and needs. o Joint influence by employees, management and customers Performance reviews, management by objectives, decentralized decision-making and horizontal coordination provide scope for competence development in daily operations. Creating employee loyalty and customer loyalty Result: o Strong culture, homogeneous staff group, easily adaptable to changes (as closeness to customers). (Like Mintzberg’s professional bureaucracy) Challenging Commitment and competence of employees are the very foundation of the company’s business development. o Involves allowing competence to take precedence over business strategies, marketing plans, and existing customer needs. o Employees are given scope for self-development, and thus, for company development. o Competence must come from employees’ initiatives ▪ Managers create conditions for learning and commitment rather than governing o The focus of the management team is to set up competence objectives and decide whether the desire for competence development is strong enough, if  the creative ability is sufficient and whether the company is innovating quickly enough. o Good for dynamic markets o Problems: ▪ Too much pressure on employees to perform ▪ Attracts employees seeking personal development (burnout) ▪ Only some competencies will be profitable; limited oversight ▪ Convincing employees that they are not overworked (they are, as they have to manage themselves as well) Buying Involves management recruiting specific employees to meet specific competence requirements. The competence requirements are thus defined by management and its knowledge and perceptions of what is needed to create attractive customer offerings. The buying strategy can at best bring increased flexibility and the ability to change a company's competence profile, compared to, for example, the molding strategy. Staffing can be easily changed when required. Based on a structural framework, the aim should always be to specialize, standardize and control, even if it is not always possible, in any case in the short term. The HR framework's ideal competence strategy is the challenging strategy, which is the opposite to an organization characterized by specialization, standardization and vertical control. If possible, according to the HR framework, the competence strategy should be allowed to take precedence over the business strategy. If possible, investment in employees should be maximized and they should be allowed to coordinate horizontally. In other words, although the structural framework's structural configurations overlap the HR framework's competence strategies, they are based on contradictory fundamental assumptions, providing two completely different normative answers to how an organization should be organized. Chapter 6 Stakeholders, Power, Politics, and Conflict – The Basics of the Power Framework (Presentation Lecture 4 is really good to complement) Focus on where we stand and organize in an organization, and to have people come towards a certain goal History Works: The Art of War – Sun Zi The Prince – Machiavelli Development in 1960s and 1970s The Fundamental Assumptions of the Power Framework 1. There are always interests, agendas and goals that contradict each other. Individuals, groups, organizations and various social bodies are therefore always in conflict with each other. 2. Conflicts cannot be resolved by making rational decisions about solutions that are best for everyone, or by agreeing on common goals. One cannot therefore design effective organizations. What is an effective way of achieving one stakeholder's goal is not necessarily effective for other stakeholders. 3. Organizational structures, formal and informal processes are always an expression of stakeholders’ exercise of power and influence. 4. Conflicts cannot always be resolved, but they are managed more or less rationally. Studying power and influence processes can increase the likelihood of getting through a certain agenda and achieving specific goals. According to some power theories, it is precisely when power cannot be seen – it might even look like everyone is united and wants the same things – that power is most skillfully exercised and most effective. According to the power framework, there is always conflict, so it is rather a question of managing conflicts in a sensible way.  A hidden or unnoticed conflict becoming visible and taking the form of an open power struggle can even be a solution, rather than a problem. 1. The power framework is critical of the structural and HR frameworks’ description of organizing and leadership as rationally and scientifically based activities aimed at benefiting all actors involved. According to the power framework, organizational structures and processes are not some kind of optimized tool for producing goods and services as efficiently as possible. Organizations are not characterized by people working together to achieve common goals. 2. The power framework is a more ideological criticism of how other frameworks, as well as more popular descriptions of management, organization and leadership, hush up the exercising of power and political processes that favor certain groups at the expense of others. This more ideological criticism becomes even more relevant when we analyze power, influence, social groups and minorities. When analyzing, for example, the scarcity of women and ethnic minorities in high management positions, the models of the power framework have a high explanatory value. Lukes’ Three Dimensions of Power Decision-making power  A has power over B to the extent that A can make B do anything that B would not otherwise have done The first dimension of power focuses on how one or more actors influence one or more other actors to perform or refrain from performing a particular act or making a certain decision. Power over the agenda Power is not only about what alternative decision is taken, given a particular matter, but also about why some issues end up on the agenda, while others don't. In other words, if you can control the context within which decisions are made, you can control much more than the outcome of a single decision-making process. This dimension can also be said to be relatively simple to analyze, albeit somewhat trickier than the first dimension of power. Instead of studying a specific issue on the agenda, and the decision-making process concerning that specific issue, you need to identify issues that are not on the agenda that could have been there. You can start with what is on the agenda and then add more issues that are not. Which actors and interests exist in the studied organization? Which actors have the power to get their interests represented as issues on the agenda? Which actors do not have that power? The most interesting issues for study might not be on any formal agenda, but still be possible to identify by studying actors, interests and issues in the context of, but not included in, the agenda. When these actors, interests and issues have been identified, the processes that lead to some issues ending up on the agenda but most not, can be studied. Power over thought (Manipulation) Manipulation is a form of influence on how others think, perceive and define themselves and their surroundings. The impact is more indirect and happens by influencing actors’ thoughts and experiences, and whether what is perceived is a problem or a solution at all. Thus, actors can sometimes be identified who deliberately exercise manipulation, while, in other cases, we have to settle for seeing power over thought as originating from more cultural and/or structural processes without any individual actor's conscious influence. Pfeffer’s Model of Conflict and Power Struggle Causes of Conflict and Open Power Struggle Organization members are influenced by the different environments in which they operate, and, since these are different, organization members also differ in their mindset, perspective and goals. Differentiation/specialization - division of work -> different perspectives More work division leads to increasing dependencies, which leads to even more conflict. Scare resources – limited -> struggle for resources Conflict + widespread power -> open power struggle (as conflict along with the ability to challenge conflict can create problems) Strategies for Managing Conflict Create Homogeneity and Consensus on Goals and Means By focusing on more comprehensive and abstract goal formulations, space is created for actors to interpret and formulate their own agendas into these goals. Create a Surplus of Resources Short-term resources -> short-term strategy Reduce and Downplay the Significance of a Decision Dividing into several smaller decisions Time limit on projects (temporary into permanent later) Scaling slowly  Downplaying the significance of a decision Mapping the Political Landscape An Initial Listing of Actors and Their Interests The identification of stakeholders is facilitated by listing all possible actors with a direct or indirect interest in a particular issue – the more the merrier. Once this list is in place, you can identify the interests, objectives or agendas of each actor with regard to the issue in question. Power Bases How much power of actor in current issue By building relationships and networks with other powerful actors, you can increase your power despite a low formal hierarchical position.  Through the active and proactive exercising of power, you can take initiative and gain control of the agenda. o Through symbolic and charismatic leadership, you can create commitment and meaning and define situations and options so that others perceive them as being beneficial to their own agenda. A Generic Stakeholder Matrix For obtaining overview of the political landscape If power is concentrated, then lower risk of power struggles One way to simplify the generic stakeholder matrix is to reduce the goals and interests of all actors to two alternatives, for example for and against a particular proposal, such as a reorganization. An Effective Power Strategy 1. Map the political landscape 2. Design and customize the agenda 3. Build networks and alliances 4. Bargain and negotiate 5. Co-opt and manipulate Design and Customize the Agenda If, for example, a structural analysis of a company results in a conclusion that the company should be restructured from a professional hierarchy into more of a machine bureaucracy, but powerful actors representing the profession oppose this, according to the power framework, the restructuring should be adapted to suit these powerful actors slightly better. Build Networks and Alliances Identifying actors’ agendas which resemble your own Bargain and Negotiate Co-opt and Manipulate Co-opting means that instead of circumventing, winning over, bargaining or cooperating with your opponents, you invite them in. By getting opponents to work close to you, over time you can influence how they look at different issues and their own role in relation to these issues. By getting your opponent to take a role similar to your own, you can thus influence the opponent's thoughts, perspectives and goals. Negotiation Models Principled Negotiation - ‘Getting to Yes’ separate the people from the problem o The combination means that you are soft on people and hard on problems. This, however, requires you to separate people and problems. Avoiding personal attacks and criticism, and instead devoting energy to listening, confirming and showing consideration and affection to the other person, increases the chance of getting more of your agenda through. focus on (the counterpart's) interests o The further from concrete solutions and options you argue, the easier it is to identify common interests. o If you first identify and talk about the other person's interests, the smaller the chance that this other person sees themselves as an opponent. generate more options o For example, a new IT system may be perceived as (horizontal) communication support, but, despite this, it also implies greater (vertical) governance and control. refer to ‘objective’ evaluation criteria. o If IBM became very successful by developing its consulting and solution business, as did HP some years later, why shouldn't we do the same? Once a number of more objective criteria have been identified and accepted, the possibility of agreeing on an option that can be implemented increases. Six Principles of Persuasion The Liking Principle Research shows that people are more affected by people they like than by people they dislike. Research also shows that there are many different reasons why we like other people more or less: physical attraction, similar perceptions, previous collaborations, and so on. The most important factor is how similar you perceive the other person to be For example, if the recipient is called Anna Johansson, her inclination to fill in the questionnaire will be higher if the sender is an Alva Jonsson rather than, say, a Sergei Lechner. In a negotiating situation, you should therefore try to identify similarities between the parties. The Authority Principle People become more influenced and more easily persuaded by others who they perceive to have legitimate authority. Authority is often perceived as legitimate if it is based on knowledge, skills and experience. An experiment (see Cialdini, 2009) has shown, for example, that if occupational therapists hang up their education diplomas and certificates on the wall in their reception, their patients, who might not usually continue to follow a practitioner's instructions after they are discharged from hospital, will follow their instructions to a much greater extent. In order to be perceived as truly credible, it is also appropriate to mention some minor knowledge gaps or weaknesses. This reduces the risk of the described knowledge base and strengths being perceived as bragging or boasting. The Scarcity Principle The scarcer a resource is, the more attractive it becomes. A large number of studies (see Cialdini, 2009) show that people value losing something much higher than not winning something, even if this is exactly the same thing, formally speaking. In a negotiating situation, you should thus highlight as many potential large losses as possible, rather than as many large profits as possible. The Consistency Principle For example, a restaurant has problems with a large number of guests who do not show up even though they have booked a table. When they call and book tables, the restaurant employee ends the call by saying: ‘Please call us and cancel if you can't come.’ When the restaurant turns this statement into a question: ‘Would you be so kind and call us if you can't come?’ the guest replies that they will do this, and the proportion of ‘no-shows’ decreases from 30 to 10 percent. Because the guest was asked to express an intention to perform a certain action, the guest's inclination to perform the action markedly increases. When it comes to negotiating situations, this means that if you make an initial decision on a comprehensive issue, the chance of you standing by such a decision increases if you write it down or repeat it orally, preferably in a public context. Writing letters of intent also increases the chance of later reaching a comprehensive agreement. The Reciprocity Principle People tend to give back what you give to them. If you smile when you meet people, chances are they will smile back. In other words, the principle of reciprocity does not only apply to material or financial resources, it also applies to attention, information, recognition and respect. Treating the other party in a pleasant, informative and appreciative way increases the chance of the other party feeling obliged to repay you in some way. The Principle of Social Proof The last principle in this description of how to increase your influence and persuade other parties is the realization that what people often choose to do in a particular situation is what they perceive other, similar people would do in similar situations. The Problematic First and Second Dimensions of Power Power is something that is exercised in specific situations where people's relationships rather than power bases determine who influences who. Power can also be seen as something that exists, or is exercised beyond such ‘micro’ situations in the form of overall structures and cultural norm systems, that individuals are neither aware of nor can do anything to change. Chapter 8 Organizational Culture, Values, Interpretations and Norms – The Basics of the Symbolic Framework We must go beyond what is visible and into the meanings, values, interpretations, ideas, perspectives and taken-for-granted assumptions that lie behind and are expressed in the glass walls, the suits, the company descriptions, and in the creation, existence, success and failure of companies. Historical Roots of the Symbolic Framework The first roots of the Symbolic Framework can be traced to the 1970s and 1980s. The Basic Assumptions of the Symbolic Framework Schein's Three Levels of Culture Schein (2004: 17) defines organizational culture as: a pattern of shared basic assumptions that the group learned 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 to perceive, think, and feel in relation to those problems. Schein (2004) adds that the group's shared basic assumptions are about how the world is and should be, and these assumptions determine their perceptions, thoughts, feelings and overt behavior. Arise in chronological order and are elements of a culture Schein’s Three Levels of Organizational Structure Artifacts To be able to see and analyze the meaning and significance of artifacts in a particular culture, we must therefore try to estrange ourselves. Perhaps not to the extent of the totally confused stranger – because then we would not understand anything at all – but a certain amount of alienation is necessary to be able to see and analyze artifacts and their meanings. This is also a leadership issue. If we cannot distance ourselves from our taken- for granted perspectives and interpretations, we cannot consciously control and create desirable cultures. Instead, we become ‘victims’ of our perspectives and the culture that defines our ‘truths'. Espoused Values Audible artifacts can be seen as things that you talk about in the organization without asking about them, while values are espoused and audible if you ask questions that are usually not asked in day-to-day work. An additional way to distinguish the two levels is to see an artifact as that which exists, that which is, while a value is about what should be and how it should be. Basic Assumptions A typical example of this kind of paradoxical empirical impressions is that an organization that describes itself as flat and decentralized can also be described as an extensively work-divided and top-down organization based on a structural analysis, even though the organization itself does not provide any such organizational charts; or that a company constantly describes itself as being entrepreneurial, creative and innovative, even though its profitability comes from advertising revenues from one and the same business that has looked the same for many years and despite the fact that most attempts at new, profitable products have failed. A Dynamic Model that Includes Learning, Socialization, Success and Crisis A strong culture can therefore be both a consequence of an organization's success and a contributory cause of the same organization's success. Hofstede’s Model for Comparing and Describing Culture Power Distance How subordinates and people with relatively little power relate to powerful individuals How power is perceived In cultures with high power distance, people accept that those in power exercise that power to a greater extent than those in in cultures with low power distance. Individualism vs Collectivism Exactly as it sounds, apparently individualistic cultures are usually stronger (western countries) Femininity versus Masculinity Feminine – collaborative and consensus-oriented (Sweden) Masculine – courage, toughness, initiative (Slovakia) Uncertainty Avoidance The extent to which members of a culture feel uncomfortable with uncertainty and ambiguity Long-term versus Short-term Orientation Long-term – train and prepare at present for the future, innovative Short-term – conservative in practices, focus on the now Indulgence versus Restraint Indulgence – provides space for fun and allows for the gratification and expression of human emotions and needs. Restraint – strongly disciplined and regulated in terms of rewards Using this Hofstede model alongside Schein’s frameworks we can analyze how a culture looks. Sub-cultures Schein and many others believe that a company or an organization can have strong sub- cultures. It can, for example, be about two departments in the same company that have completely different sets of basic assumptions, even though they have many common artifacts and also a lot of common espoused values. Groupthink (Janis) Main principle: The more amiability and esprit de corps there is among the members of a policy- making in-group, the greater the danger that independent critical thinking will be replaced by groupthink, which is likely to result in irrational and dehumanizing actions directed against outgroups. Characteristics of Groupthink: According to Janis, groupthink is more likely to arise in groups where the following three conditions are fulfilled: high group cohesion High status or really molded groups are prone to symptoms More important to belong, than express individuality structural shortcomings Isolation, lack of impartial leadership (lack of unbiased), lack of norms regarding the importance of formalized regulations and processes, social and ideological backgrounds of group members are homogeneous pressing external conditions Rapid decisions, under stress, or threatening situation can increase risk of group think Groupthink can arise even if all three conditions are not met. Remedies to Avoid Groupthink Introduce critical evaluators (Possibly outside evaluation groups) Have open discussions, as objective as possible (objections should be presented) Second chance meeting – coming up with doubts about an idea Janis seems to think that we are not rational, especially not in certain types of groups, but that with properly designed structures and processes, we can improve and become more rational in our decision-making. Charismatic, Transformative and Symbolic Leadership (Leadership models) Charismatic Leadership One way to create and maintain a reasonably stable identity is to identify with different groups. We thus perceive ourselves as members of ‘we-groups’ and contrast ourselves and our groups with ‘they-groups'. A social development spiral is thus created, and charismatic leadership gradually emerges. The process can be viewed as a kind of social diffusion that is stimulated by (1) high uncertainty or crisis, (2) people's need to reduce uncertainty through social relations, and (3) the fact that there is always a certain heterogeneity in groups and that someone therefore best fits the norms and values of a charismatic leadership personality (Hogg 2001). Transformative Leadership This refers to leadership that causes followers to want to achieve goals that are beyond their own self-realization Transformative leadership is about transforming the members of a group or an organization. Symbolic Leadership The basic principle of symbolic leadership is that it is about influencing how others interpret and experience their surroundings and themselves. using symbols to get attention  framing and formulating perspectives for the experience of others (Bolman and Deal use the word framing, which has just this double meaning: to frame but also to formulate) formulating and communicating visions (what could be) telling compelling stories. o For Aristotle, the truth was always stronger than the lie, but if the owner of the truth was not schooled in rhetoric, their message could still be forced out by the liar's, if the liar was skilled in rhetoric. It was therefore important that leaders, even the most knowledgeable and objective, were educated in the science of rhetoric. o To be a really convincing storyteller, the symbolic leader therefore needs to complement his logical ability with an entertaining and charming personality and an emotional commitment. Lifestyle, meaning, identity, brand loyalty and several more symbolic values then become a relatively more important area in which organizations and companies can compete. For business executives and managers, this means that it is at least as important to present, represent and personify a company as it is to manage its technical production of products and services. An analysis of a manager's or leader's symbolic leadership is thus about assessing how skillfully the manager/leader uses symbols, frames the experiences of others, formulates visions and tells stories. Such an analysis should include whether a leader, in competition with others, succeeds in gaining power over thought, that is, in manipulating their employees in a given situation. Formulating and communicating visions (from above): Visions are about daring to formulate a more unexpected and incredible future state. Not only does a vision not have to be close to the truth, it does not have to be  based on logical reasoning either. Instead of a systematic logic, it should be based on a narrative or narrative logic (Bruner 1987, CzarniawskaJoerges 1997). Instead of constructing a consistent message based on clear facts and logical arguments, the narrative logic means that the message should have some kind of drama, a beginning, a plot, heroes, villains, and an end. It becomes more forceful if it is vague and has gaps that the receiver's imagination can fill in. Brunsson's Model for Decision Rationality, Action Rationality and Organizational Hypocrisy Decision versus Action Rationality Brunsson (1985, 1989, 2003) believes that formal decisions made in organizations often do not lead to action, that is, the decisions are never implemented. People and organizations cannot and should not make rational decisions, if they want to bring about action. In order to achieve action, the focus should rather be on avoiding rational decision-making processes as much as possible. This is because rational decision-making processes have a tendency to generate unmanageable amounts of information, create doubt and reduce the motivation to act, which together lead to paralysis. It is, therefore, according to Brunsson's model, completely logical and sensible to avoid rational decision-making processes if the goal is to achieve effective action in companies and organizations. Organizations can design both efficient decision-rational processes and effective action- rational processes, as long as they are kept apart. By decoupling the two types of process, efficient production of goods and services can continue without being disrupted by paralyzing rational decision-making processes. At the same time, demands for rational decisions and rationally designed structures and processes are satisfied via the de- coupled rational decision-making processes. Decision-rational Processes – Talk Organizations can thus attract important resources (for example, money and people, but also government permits, customers and suppliers) by producing decision-rational talk. The more rational, that is, the larger the factual basis, the more alternatives and the more advanced evaluations (for example, risk-assessment techniques), the more resources an organization can attract through its production of talk. The fact that this talk could lead to a paralyzed organization plays less of a role, if it is de-coupled from the action-rational activities. Action-rational Processes – Action If a more comprehensive change is required, a solution is chosen that people believe in, but care is taken not to investigate a large number of options to try to find the best one – it would risk getting caught up in a paralyzing, comprehensive, rational decision-making process. Decoupling Decision-rational Talk from Action-rational Action In many organizations, there is a separation between decision-making at higher levels and actual operational actions at lower levels. Senior executives often focus on decision- making and strategies, while middle managers and lower-level employees handle actual production and operations. This separation is maintained by middle managers, who buffer the operational processes from the often impractical strategies from the top. Other departments, like strategy or risk control, similarly focus on planning and legitimizing the organization rather than directly impacting daily operations. This structure helps the organization appear legitimate to outsiders, attracting employees, investors, and customers, even if many top-level strategies are never implemented on the ground. Organizational Hypocrisy Talk is one thing, decision another and action a third. Hypocrisy - formulating a moral guideline that does not correspond to one's own actions. According to Brunsson's theory of organizational hypocrisy, formulated plans and goals may decrease rather than increase the likelihood of something being implemented (Brunsson 1989, 2003). Setting up the objective that an organization's managers will, in 10 years’ time, consist of half women and half men, can reduce the demand for concrete measures, compared to no goal being formulated. Setting the goal of a steel plant reducing carbon dioxide emissions by 20 percent in five years, can make it easier to obtain new permits to release high levels of carbon dioxide for another year.