fligstein on chandler

Dick Langlois drew my attention to a special issue of Business History Review honoring Alfred Chandler. Among the many notable scholars writing essays is Neil Fligstein, whose book The Transformation of Corporate Control acknowledged Chandler as an important influence. Reading Chandler was a memorable experience for me. After Weber, Chandler’s Strategy and Structure and The Visible Hand were two of the first books I read when preparing for my organizational theory preliminary exam in grad school. Like Fligstein I was impressed by Chandler’s focus on the big, historical questions. While we often equate Chandler with arguments of efficiency and organizational structure, his greatest contribution was drawing attention to the large societal changes associated with the rise of the corporate form. Fligstein points out how this broad, historical treatment differed greatly from the dominant sociological scholarship on organizations of the 1960s and 70s.

Chandler’s outlook presented a twofold challenge to sociologists of organizations. First, their concern to construct a scientific theory of organizations meant that sociologists had given up on the Weberian project of understanding how historical forms like the corporation emerged and were transformed. This made it hard for them to ask the big questions, such as those proposed by Chandler and Weber. Chandler’s relentless historicism pushed sociologists to move away from the idea that a scientific theory of organizations would account for the emergence and dynamics of these institutions. Instead, sociology had to recognize that there was a time when such organizations did not exist, and to acknowledge that new organizations and organizational forms were constantly appearing.

Second, these sociologists’ narrow focus on a few organizational characteristics, and their determination to view all organizations as the same, prevented them from considering the ways that firms differed from state bureaucracies and nonprofits. It also discouraged scholars from analyzing what the relations might be among governments, firms, and nonprofits. The sociology of organizations in the form that it existed could not get back to Weber’s original formulation, which stressed the interdependence of the various factors that produced modern society. Eventually, organizational theorists confronted both problems and began to evolve a new set of views.

Fligstein then argues that institutional theory, population ecology, and the comparative study of capitalism were, in some ways, reactions to and critiques of Chandler. For example, organizational ecology explicitly rejected the idea that you could understand historical evolution of organizational forms simply by looking at the most successful survivors; they maintained that population analysis was the only valid way to understand the dynamics of form evolution. Some scholars, like Fligstein, Dobbin, Perrow, Roy, and Freeland actually reanalyzed the historical cases that inspired Chandler’s original thesis, demonstrating how Chandler failed to consider alternative explanations for the rise of (and variation in) the dominant corporate form.

Fligstein’s take on Chandler is interesting (and I think it’s safe to say that few sociologists know or understand Chandler’s work better). Usually the emergence of institutional theory and organizational ecology are attributed to Stinchcombe’s (1965) paper on social structure, but Fligstein points out that they were also reactions to Chandler’s naive historical view. I think Fligstein is certainly correct that the new wave of theorizing about organizations in the late 1970s were rejections of the static theories of organizational heterogeneity that dominated the 1960s, while also being rejections (especially DiMaggio and Powell 1983) of Chandler-like theories of competition and organizational efficiency. What I’m less convinced of is that organizational scholarship has fully embraced the comparative, historical analysis typical of Weber. It’s true that we’re much better now than we were at incorporating history into our analyses, but I think we’re still lacking in the comparative side. More on that later.