Cyert and March are saying something like this: Sam Smith, the assistant janitor; Jim Ford, the foreman; and Celestine Cohen-Peters, the company president are all members of a grand coalition, Cohen-Peters Enterprises. All make demands on resources and bargain to get what they care about. Cohen-Peters has more authority than Jones or Ford and, in case of disagreement, she will often win—but not always. Her in!uence depends on how much power she mobilizes in comparison with that of Smith, Ford, and other members of the coalition. Xerox had a close brush with bankruptcy in 2001 under a CEO who had come
188 Reframing Organizations
WEBC09 05/26/2017 1:42:45 Page 189
from the outside and never mastered the politics at the top of the organization. The “rm was adrift, and the captain lost control of his ship. His successor, Anne Mulcahy, was a canny insider who built the relationships and alliances she needed to get Xerox back on course.
If political pressures on goals are visible in the private sector, they are blatant in the public arena. As in the Challenger incident, public agencies operate amid a welter of constituencies, each making demands and trying to get its way. The result is a confusing multiplicity of goals, many in con!ict. Consider Gazprom, Russia’s biggest company and the world’s largest producer of natural gas. Gazprom supplies most of the natural gas in Eastern Europe and 25 percent or more in France, Germany, and Italy. It began as a state ministry under Mikhail Gorbachev, became a public stock company under Boris Yeltsin, and then turned semipublic under Vladimir Putin, with the Russian government the majority stockholder.
Many observers felt that Gazprom functioned as an extension of government policy. Prices for gas exports seemed to correlate with how friendly a government was to Moscow. “If people take us for the state, that doesn’t make us unhappy,” said Sergey Kouprianov, a company spokesman. “We identify with the state” (Pasquier and Chevelkina, 2007, p. 43). Russian President Vladimir Putin returned the sentiment. Gazprom produced a quarter of Russia’s government revenues, and Putin saw hydrocarbons substituting for the Red Army as a lever to project Russian power. At the same time, Russian consumers got their gas at about 20 percent of market price. When the company tried for a domestic price increase in 2006, it was blocked by a government that was thinking ahead to the next presidential election. Was this giant in business to bene”t customers, management, stockholders, the Kremlin, or Russian citizens? All of the above and more, because all were participants in the grand and messy Gazprom coalition.
Greatest Hits from Organization Studies Hit Number 3: Richard M. Cyert and James G. March, A Behavioral Theory of the Firm (Upper Saddle River, NJ: Prentice Hall, 1963)
Coming in at number three on the scholars’ lists of greatest hits is a 40-year-old book by an economist, Richard Cyert, and a political scientist, James G. March. Cyert and March de!ned their basic purpose as developing a predictive theory of organizational decision making rooted in a realistic understanding of how decisions actually get made. They rejected as unrealistic the traditional economic view of a !rm as a unitary entity (a corporate “person”) with a singular goal of maximizing pro!ts. Cyert and March chose instead to view organizations as coalitions made up of individuals and subcoalitions. This view implied a central idea of the political frame: goals
Power, Conflict, and Coalition 189
WEBC09 05/26/2017 1:42:45 Page 190
emerge out of a bargaining process among coalition members. Cyert and March also insisted that “side payments” are critical, because preferences are only partly compatible and decisions rarely satisfy everyone. A coalition can survive only if it offers suf!cient inducements to keep essential members on board. This is not easy, because resources—money, time, information, and decision- making capacity—are limited.
In analyzing decision making, Cyert and March developed four “relational concepts,” implicit rules that !rms use to make decisions more manageable:
1. Quasiresolution of con!ict. Instead of resolving con”ict, organizations break problems into pieces and farm pieces out to different units. Units make locally rational decisions (for example, marketers do what they think is best for marketing). Decisions are never fully consistent but need only be aligned well enough to keep the coalition functioning.
2. Uncertainty avoidance. Organizations employ a range of simplifying mechanisms—such as standard operating procedures, traditions, and contracts—that enable them to act as if the environment is more predictable than it is.
3. Problemistic search. Organizations look for solutions in the neighborhood of the presenting problem and grab the !rst acceptable solution.
4. Organizational learning. Over time, organizations evolve their goals and aspiration levels, altering what they attend to and what they ignore, and changing search rules.
POWER AND DECISION MAKING At every level in organizations, alliances form because members have interests in common and believe they can do more together than apart. To accomplish their aims, they need power. Power can be viewed from multiple perspectives. Structural theorists typically emphasize authority, the legitimate prerogative to make binding decisions. In this view, managers make rational decisions (optimal and consistent with purpose), monitor to ensure that decisions are implemented, and assess how well subordinates carry out directives. In contrast, human resource theorists place less emphasis on power and more on empower- ment (Bennis and Nanus, 1985; Block, 1987). More than structuralists, they emphasize limits of authority and tend to focus on in!uence that enhances mutuality and collaboration. The implicit hope is that participation, openness, and collaboration substitute for sheer power.
The political frame views authority as only one among many forms of power. It recognizes the importance of individual (and group) needs but emphasizes that scarce resources and incompatible preferences cause needs to collide. Politically, the issue is how competing groups articulate preferences and mobilize power to get what they want. Power, in this view, is not evil: “We have to stop describing power always in negative terms: [as in] it excludes, it represses. In fact, power produces; it produces reality” (Foucault, 1975, p. 12).
190 Reframing Organizations
WEBC09 05/26/2017 1:42:45 Page 191
Authorities and Partisans Gamson (1968) describes the relationship between two antagonists—partisans and author- ities—that are often central to the politics of both organizations and society. By virtue of the of”ce they hold, authorities are entitled to make decisions binding on their subordinates. Any member of the coalition who wants to exert bottom-up pressure is a potential partisan. Gamson describes the relationship in this way: “Authorities are the recipients or targets of in!uence, and the agents or initiators of social control. Potential partisans have the opposite roles—as agents or initiators of in!uence, and targets or recipients of social control” (p. 76).
In a family, parents function as authorities and children as partisans. Parents make binding decisions about bedtime, television viewing, or which child uses a particular toy. Parents initiate social control, and children are the recipients of parental decisions. Children in turn try to in!uence the decision makers. They argue for a later bedtime or point out the injustice of giving one child something another wants. They try to split authorities by lobbying one parent after the other has refused. They may form a coalition (with siblings, grandparents, and so on) in an attempt to strengthen their bargaining position.
Authority is essential to anyone in a formal position because social control depends on it. Of”ceholders can exert control only so long as partisans respect or fear them enough that their authority or power remains intact. If partisans are convinced that existing authorities are too evil or incompetent to continue, they will risk trying to wrest control—unless they regard the authorities as too formidable. Conversely, if partisans trust authority and see it as legitimate, they will accept and support it in the event of an attack (Gamson, 1968; Baldridge, 1971). In almost any instance of unrest or revolution, there is a sharp cleavage between rebels and loyalists.
If partisan opposition becomes too powerful, authority systemsmay collapse. The process can be very swift, as illustrated by events in Eastern Europe in 1989 and the Arab Spring of 2011–2013. In both cases, established regimes had lost legitimacy years earlier but held on through coercion and control of access to decision making. When massive demonstrations erupted, authorities faced an unnerving choice: activate the police and army in the hope of preserving power or watch their authority fade away. Authorities in China and Romania in 1989, Libya in 2011, and Egypt and Syria in 2012, chose the “rst course. It led to bloodshed in every case, but only the Chinese were able to quash their opposition quickly. Elsewhere, authorities’ attempts to quell dissent with force were futile, and their legitimacy evaporated.
The period of evaporation is typically heady but always hazardous. When the old regime collapses, the question is whether new authority can reconstitute itself quickly enough to avoid chaos. Authorities and partisans both have reason to fear a specter such as Bosnia and Liberia in the 1990s, Somalia for the last 25 years, Iraq in the aftermath of U.S. intervention
Power, Conflict, and Coalition 191
WEBC09 05/26/2017 1:42:45 Page 192
or Syria since the Arab Spring of 2011. All are tragic examples of chronic turmoil and misery, with no authority strong enough to bring partisan strife under control.
Sources of Power Authorities and partisans both have many potential sources of power. A number of social scientists (Baldridge, 1971; French and Raven, 1959; Kanter, 1977; Mann, 1986; Pfeffer, 1981, 1992; Russ, 1994) have tried to identify the various wellsprings of power. The list includes:
• Position power (authority). Positions confer certain levels of legitimate authority. Professors assign grades; judges settle disputes. Positions also place incumbents in more or less powerful locations in communications and power networks. It is as helpful to be in the right unit as it is to hold the right job. A lofty title in a backwater department may not carry much weight, but junior members of a powerful unit may have substantial clout (Pfeffer, 1992).
• Control of rewards. The ability to deliver jobs, money, political support, or other rewards brings power. Political bosses and tribal chiefs, among others, cement their power base by delivering services and jobs to loyal supporters (Mihalopoulos and Kimberly, 2006).
• Coercive power. Coercive power rests on the ability to constrain, block, interfere, or punish. A union’s ability to walk out, students’ capacity to sit in, and an army’s ability to clamp down exemplify coercive power. A chilling example is the rise of suicide attacks in recent decades from about three a year worldwide in the 1980s to about one a day in 2016 (Chicago Project on Security and Terrorism, 2016). They were only about 3 percent of terror incidents but accounted for almost half the fatalities (Pape, 2006, p. 4).