Maslow and Kohlberg, intertwined, gave Burns a foundation for constructing a positive view of politics: “If leaders are to be effective in helping to mobilize and elevate their constituencies, leaders must be whole persons, persons with full functioning capacities for thinking and feeling. The problem for them as educators, as leaders, is not to promote narrow, egocentric self-actualization, but to extend awareness of human needs and the means of gratifying them, to improve the larger social situation for which educators or leaders have responsibility and over which they have power” (1978, pp. 448–449).
Burns’s view provides two expansive criteria: Does your leadership rest on general moral principles? And does it appeal to the “better angels” in your constituents’ psyches? Lax and Sebenius (1986) see ethical issues as inescapable quandaries but provide a concrete set of questions for assessing leaders’ actions:
• Are you following rules that are mutually understood and accepted? In poker, for example, players understand that bluf!ng is part of the game but pulling cards from your sleeve is not.
• Are you comfortable discussing and defending your choices? Would you want your colleagues and friends to know what you’re doing? Your spouse, children, or parents? Would you be comfortable if your deeds appeared on the Web or in your local newspaper?
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• Would you want to be on the receiving end of your own actions? Would you want this done to a member of your family?
• Would the world be better or worse if everyone acted as you did? If you were designing an organization, would you want people to follow your example? Would you teach your children the ethics you have embraced?
• Are there alternatives you could consider that rest on “rmer ethical ground?Could you test your strategy with a trusted advisor and ask about other possibilities?
These questions embody four principles of moral judgment:
Mutuality.Are all parties to a relationship operating under the same understanding about the rules of the game? Enron’s Ken Lay was talking up the company’s stock to analysts and employees even as he and others were selling their shares. In the period when WorldCom improved its pro!ts by cooking the books, it made its competitors look bad. Top executives at competing !rms such as AT&T and Sprint felt the heat from analysts and shareholders and wondered, “Why can’t we get the results they’re getting?”Only later did they learn the answer: “They’re cheating, and we’re not.”
Generality. Does a speci!c action follow a principle of moral conduct applicable to comparable situations? When Enron and WorldCom violated accounting principles to in”ate their results, they were secretly breaking the rules, not adhering to a broadly applicable rule of conduct.
Openness.Are we willing to make our thinking and decisions public and confrontable? As Justice Oliver Wendell Holmes observed many years ago, “Sunlight is the best disinfec- tant.” That was why Aruna Roy was so passionate about making government more transparent. Keeping others in the dark has been a consistent theme in corporate ethics scandals. Enron’s books were almost impenetrable, and the company attacked analysts who questioned the numbers.
Caring.Does this action show concern for the legitimate interests and concerns of others? Enron’s effort to protect its share price by locking in employees so they couldn’t sell the stock in their retirement accounts, even as the value of the shares plunged, put the interests of senior executives ahead of everyone else’s.
Business scandals come in waves; they are a predictable feature of the trough following every business boom. After the market boom of the Roaring Twenties and the crash that began the Great Depression, the president of the New York Stock Exchange went to jail in
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his three-piece suit (Labaton, 2002). There was another wave of corporate scandals in the 1970s. The 1980s gave us Ivan Boesky and the savings and loan crisis. And in the early years of the twenty-!rst century, we have seen scandals at Enron, Siemens, Volkswagen, Wells Fargo Bank, and WorldCom, among many others. There will always be temptation whenever big egos and large sums of money are at stake. Too many managers rarely think or talk about themoral dimension of management and leadership. Porter notes the dearth of such conversation:
In a seminar with seventeen executives from nine corporations, we learned how the privatization of moral discourse in our society has created a deep sense of moral loneliness and moral illiteracy; how the absence of a common language prevents people from talking about and reading the moral issues they face. We learned how the isolation of individuals—the taboo against talking about spiritual matters in the public sphere—robs people of courage, of the strength of heart to do what deep down they believe to be right (1989, p. 2).
If we banish moral discourse and leave managers to face ethical issues alone, we invite dreary and brutish political dynamics. An organization can and should take a moral stance. It can make its values clear, hold employees accountable, and validate the need for dialogue about ethical choices. Positive politics without an ethical framework and moral dialogue is as unlikely as bountiful harvests without sunlight or water.
CONCLUSION The question is not whether organizations are political, but what kind of politics they will encompass. Political dynamics can be sordid and destructive. But politics can also be a vehicle for achieving noble purposes. Organizational change and effectiveness depend on managers’ political skills. Constructive politicians know how to fashion an agenda, map the political terrain, create a network of support, and negotiate with both allies and adversaries. In the process, they will encounter a predictable and inescapable ethical dilemma: when to adopt an open, collaborative strategy or when to choose a tougher, more adversarial approach. In making such choices, they have to consider the potential for collaboration, the importance of long-term relationships, and, most important, their own and their organi- zation’s values and ethical principles.
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11 c h a p t e r
Organizations as Political Arenas and Political Agents
Peace extends only to private life. In business it is war all the time.
—George Eastman, Founder of Eastman Kodak
Sam Walton started his merchant career in 1945 as proprietor of the second-best variety store in a small rural Arkansas town. From that
humble beginning, he built the world’s largest retail chain. With more than 2 million “associates,”Walmart became the world’s largest employer and, for both better and worse, one of the most powerful companies on the globe. More than 90 percent of American households shop at Walmart stores every year, expecting the company to keep its promise of “always low prices” (Fishman, 2006).
Walmart’s subtle and pervasive impact is illustrated in a little-known story about deodorant packaging. Deodorant containers used to come packed in cardboard boxes until Walmart decided in the early 1990s that the boxes were wasteful and costly—about a nickel apiece for something consumers would just toss. When Walmart told suppliers to kill the cardboard, the boxes disappeared across the industry. Good for Walmart had to be good enough for everyone. The story is but one of countless examples of the “Walmart effect”—an
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umbrella term for multiple ways Walmart in!uences consumers, vendors, employees, communities, and the environment (Fishman, 2006).
Yet, for all its power and success, Walmart has struggled in recent years to cope with an assortment of critics and image problems. The company has been accused of abusing workers, discriminating against women, busting unions, destroying small businesses, damaging the environment, and bribing government of”cials in Mexico and elsewhere. Circled by enemies, it has mounted major public relations campaigns in defense of its image.
Like all organizations, Walmart is both an arena for internal con!ict and a political agent or player operating on a “eld crammed with other organizations pursuing their own interests. As arenas, organizations house an ongoing interplay of players and agendas. As agents, organizations are powerful tools for achieving the purposes of whoever calls the shots. Walmart’s enormous size and power have made its political maneuvers widely visible; almost everyone has feelings about Walmart, one way or another. The company’s historic penchant for secrecy and its secluded location in Bentonville, Arkansas, have sometimes shielded its internal politics from the spotlight, but tales of political skullduggery still emerge, including a titillating story about a superstar marketing executive who was “red amid rumors of an of”ce romance and con!ict with her conservative bosses. The same year also spawned the strange tale of a Walmart techie who claimed he’d been secretly recording the deliberations of the board of directors. Walmart has historically resisted any efforts to unionize its workers, but in the fall of 2012, the company had its “rst experience with strikes by workers in multiple cities. Ambivalent shoppers told reporters that they sympathized with the workers but still shopped at Walmart because they could not afford to pass up the low prices.
This chapter explores organizations as both arenas and political agents. Viewing organizations as political arenas is a way to reframe many organizational processes. Organization design, for example, can be viewed not as a rational expression of an organization’s goals but as a political embodiment of contending claims. In our discussion of organizations as arenas, we examine the political dimensions of organizational change, contrasting directives from the top with pressures from below. As political agents, organizations operate in complex ecosystems—interdependent networks of organizations engaged in related activities and occupying particular niches. We illustrate several forms that ecosystems can take—business, public policy, business-government, and society. Finally, we look at the dark side of the power wielded by big organizations. We explore the concern that corporate giants represent a growing risk to the world because they are too powerful for anyone to control.
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ORGANIZATIONS AS ARENAS From a political view, “happily ever after” exists only in fairy tales. Today’s winners may quickly become tomorrow’s losers or vice versa. Change and stability are paradoxical: Organizations constantly change and yet never change. As in competitive sports, players come and go, but the game goes on. In the annals of organizational politics, few have illustrated these precepts as well as Ross Johnson, who once made the cover of Time magazine as an emblem of corporate greed and insensitivity. In Barbarians at the Gate, Bryan Burrough and John Helyar (1990) explain how.
Barbarians at the Gate
Ross Johnson began his career in the 1960s. His charm, humor, and charisma moved him ahead, and by the mid-1970s he was second in command to Henry Weigl at the consumer products !rm Standard Brands. Johnson’s lavish spending (on limousines and sumptuous entertainment, for example) soon put him on a collision course with his tight!sted boss, who tried to get him !red. But Johnson had wooed members of Standard’s board of directors so successfully that he had more friends on the board than Weigl. Johnson argued that Weigl’s conservative style was strangling the company, and the board bought his pitch. Weigl was kicked upstairs, and Johnson took over. He !red many of Weigl’s people and enjoyed a spectacular period of lavish spending on executive perks. After four years of mediocre business results, the company got an unexpected call from the chairman of the food giant Nabisco, who proposed a merger of the two companies. Within two weeks, the transaction was done: a $1.9 billion stock swap—a big deal in 1981.
