The Anatomy of Organization: Lessons for administrative theory

In Chapter 11 the position was taken that the currently accepted “principles of administration” are little more than ambiguous and mutually contradictory proverbs, and that a new approach was needed to establish a consistent and useful administrative theory. This is a fact that is beginning to be recognized in the literature of administration. If we study the chain of publications extending from Mooney and Reiley through Gulick, the President’s Committee controversy, to Schuyler Wallace and Benson, we see a steady shift of emphasis from the “principles of administration” themselves to a study of the conditions under which competing principles are respectively applicable. We no longer say that organization should be by purpose, but rather that under such and such conditions purpose organization is desirable, but under such and such other conditions, process organization is desirable. It is the central thesis of this study that an understanding of these underlying conditions for the applicability of administrative principles is to be obtained from an analysis of the administrative process in terms of decisions.

If this approach be taken, the rationality of decisions—that is, their appropriateness for the accomplishment of specified goals—becomes the central concern of administrative theory. As was pointed out, however, in Chapter II, if there were no limits to human rationality administrative theory would be barren. It would consist of the single precept: Always select that alternative, among those available, which will lead to the most complete achievement of your goals. The need for an administrative theory resides in the fact that there are practical limits to human rationality, and that these limits are not static, but depend upon the organizational environment in which the individual’s decision takes place. The task of administration is so to design this environment that the individual will approach as close as practicable to rationality.

1. The Area of Rationality

As has also been explained in Chapter II, when the limits to rationality are viewed from the individual’s standpoint, they fall into three categories: he is limited by his unconscious skills, habits, and reflexes; he is limited by his values and conceptions of purpose, which may diverge from the organization goals; he is limited by the extent of his knowledge and information. The individual can be rational in terms of the organization’s goals only to the extent that he is able to pursue a particular course of action, he has a correct conception of the goal of the action, and he is correctly informed about the conditions surrounding his action. Within the boundaries laid down by these factors his choices are rational—goal-oriented.

Rationality, then, does not determine behavior. Within the area of rationality behavior is perfectly flexible and adaptable to abilities, goals, and knowledge. Instead, behavior is determined by the irrational and nonrational elements that bound the area of rationality. The area of rationality is the area of adaptability to these nonrational elements. Two persons, given the same possible alternatives, the same values, the same knowledge, can rationally reach only the same decision. Hence, administrative theory must be concerned with the limits of rationality, and the manner in which organization affects these limits for the person making a decision. The theory must determine—as suggested in Chapter X— how institutionalized decision can be made to conform to values developed within a broader organizational structure. The theory must be a critique of the effect (judged from the point of view of the whole organization) of the organizational structure upon the decisions of its component parts and its individual members.

Perhaps an example of the way in which the organization can alter each of the three types of limits enumerated above will make the problem more concrete:

Limited Alternatives. Suppose a bricklayer is unable to work at an acceptable speed. There may be no lack of rationality in his behavior. The fact may be that his skills are not sufficiently developed to enable him to lay bricks rapidly. However, if attention were to be given to the skills themselves, if he were given instruction and training in proper methods, the impossible might readily become possible. Skills are examples of behavior patterns that in the short run limit the sphere of adaptability or rationality, but in the long run may, by training, open up entirely new behavior possibilities.

Reorientation ofVdues. In certain situations, at least, it is possible to reorient an individual from identification with a subgoal of the organization to identification with a broader and more inclusive goal. The writer has had occasion in another context to point to this method for reorienting the behavior of a “rational person” by altering his framework of values. The problem dealt with in that situation was to control and modify the motivation of a group of social workers who were participating in an administrative experiment:

To the worker, the experiment might seem inconsistent with the objec- tives he was trying to attain in his daily job. The cooperation of such a worker could be obtained only by interpreting the study in terms of his more fundamental values and by showing him that these broader values would be benefited by a temporary sacrifice of some of his immediate objectives and attitudes. In this way his attention might be detached from the narrower frame of reference—the conditioned reflexes, so to speak—forced on him by his regular daily schedule of work.10

Limits of Knowledge. Where a particular item of knowledge is needed repeatedly in decision, the organization can anticipate this need and, by providing the individual with this knowledge prior to decision, can extend his area of rationality. This is particularly important when there are time limits on decision. Thus, a policeman is trained in methods of making arrests, handling unruly prisoners and the like, so that he will not have to figure these things out on the spot when occasion requires.

2. Individual and Group Rationality

A decision is rational from the standpoint of the individual (subjectively rational) if it is consistent with the values, the alternatives, and the information which he weighed in reaching it. A decision is rational from the standpoint of the group (objectively rational) if it is consistent with the values governing the group, and the information that the group possesses relevant to the decision. Hence, the organization must be so constructed that a decision which is (subjectively) rational from the standpoint of the deciding individual, will remain rational when reassessed from the standpoint of the group.

Suppose that an officer orders a soldier under his command to capture a particular hill. Rationality (subjective) demands of him that he combine this objective, or value, with the skills he possesses for approaching hostile positions, and with the information his senses provide him regarding his situation.

On the other hand, rationality requires of the officer that the objective he assigns the soldier shall contribute to the broader objective of his unit (which usually implies that the soldier’s objective must have a reasonable possibility of successful attainment), and that he provide the soldier with all available information that may assist him in his task. To say that the officer is rational means that the soldier’s behavior continues to appear rational when evaluated from the broader viewpoint which the officer’s position affords him.

This is the basic task of administration—to provide each “operative” employee with an environment of decision of such a kind that behavior which is rational from the standpoint of this environment is also rational from the standpoint of the group values and the group situation. Moreover, it must be taken into consideration that the establishment of an environment of decision for the individual involves problems of communication for the organization. These then are the basic elements from which a theory of organization can be constructed: ( 1 ) a decision made above the operative level must be communicated; (2) wherever a decision is made, its quality will depend on the environment that bounds the area of rationality of the person making the decision. With respect to the first element, the technology of communication (in the very broadest sense) is the limiting factor; with respect to the second, the limiting factors are the very factors that limit the area of individual rationality.

3. Importance of Organizational Location

Since administrative theory is concerned with control of the nonra- tional, it follows that, the larger the area of rationality, the less important is the administrative organization. For example, the function of plan preparation, or design, if it results in a written plan that can be communicated interpersonally without difficulty, can be located almost anywhere in the organization without affecting results. All that is needed is a procedure whereby the plan can be given authoritative status; and that can be provided in a number of ways. A discussion, then, of the proper location for a planning or designing unit is apt to be highly inconclusive, and may hinge on the personalities in the organization and their relative enthusiasm, or lack of it, toward the planning function.11

On the other hand, when factors of communication or identification are crucial to the making of a decision, the location of the decision in the organization is of great importance. The method of allocating decisions in the army, for instance, automatically (and “theoretically,” I hasten to add) provides, at least in the period prior to the actual battle, that each decision will be made where the knowledge is available for coordinating it with other decisions. Similarly, we may note that final decisions regarding budget allowances are always entrusted to administrators who are not identified with the particular items to be allowed, but must weigh these items against alternative items.

Source: Simon Herbert A. (1997), Administrative Behavior, Free Press; Subsequent edition.

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