variety reducing organizations
I just got back from a much needed three week vacation with the family and feel well rested and ready for work (and blogging). Included in my beach reading was this agreeable little book containing oral histories of professional baseball players during the first turn-of-the-century. The book, The Glory of Their Times, is full of surprising anecdotes about the way the game used to be played. Among other things, we learn from their histories that fans used to sit right on the field during games and that they would often spill onto the field after games to talk to players and cause a ruckus. Fred Merkle’s “bonehead” play against the Chicago Cubs in 1908 , in which Merkle forgot to touch second base after a hit that supposedly drove in the game winning run, occurred in the midst of an onslaught of fans rushing the field to congratulate the Giants for a victory. Unfortunately for Merkle, one of the Cubs noticed the error and pointed it out to the umpire, who decided that the game should end in forfeit because the Giants couldn’t clear the field of their fans. The book is full of all sorts of interesting details like this, which reinforce in the mind of the modern baseball fan that the game has changed significantly in the past 100 years and that steroids is really just a blip on the radar screen when viewed from that perspective.
Much of what has changed about baseball over the last century, including the outlawing of performance enhancing drugs, can be seen as an attempt to standardize performance so that it appears to the public, or at least to baseball’s fan base, that there are fair conditions for competition. The idea that professional sports is designed such to create the illusion of competitiveness is something I talked about in an earlier post. One of the primary ways that professional sports leagues do this is to reduce behavioral variety in the game itself. For baseball this has meant creating expectations of conduct for fans (e.g., fans are no longer allowed or encouraged to sit leisurely on the field during games), getting rid of the spitball and other performance oddities, regularly replacing the ball in order to maximize hitting regularity (rather than hitting conditions worsening throughout the game), regulating off-the-field player behavior, etc. Some of these changes came as the result of prominent crises in the game (e.g., the Black Sox scandal introduced a number of changes in policy) but many were adopted gradually and diffused as common solutions to collective action problems within the game (e.g., ballpark dimensions).
Standardizing behavior (and setting audiences’ expectations) is not only fundamental to sports organizations but is a basic function of any organization. Organizations remold some portion of the world to generate a particular set of behaviors, outcomes, performance, etc. They are designed to wash out noise and create a predictable set of outcomes. Even failing organizations do this, although they may regularly produce something the world doesn’t want. This aspect of organizations has been discussed by a number of theorists. It is central to Weber’s idea of bureaucracy as an instrument of control. Hannan and Freeman touch on this when they talked about the need for organizations to produce “reliability and accountability.” Learning theory is all about how organizations routinize human behavior. It’s also central to my latest paper with Teppo and Dave Whetten (now available on the Organization Science website). The idea is most succinctly captured, I think, by Bruce Kogut when he said that “organization by firm is variety reducing” (pg. 408). Organizations are designed to create more homogeneity within their boundaries than exists outsides those boundaries.
There are at least two ways in which organizations reduce variety. As learning theorists are prone to point out, organizations develop rules, routines, procedures, etc. that guide human action and group interaction. One of the best books I’ve read on this is Robin Leidner’s book on service work, Fast Food, Fast Talk: Service Work and the Routinization of Everyday Life. Her book details the various ways that organizations control what goes on inside their boundaries. By examining service work, she focuses on a setting that is somewhat more difficult to routinize than manufacturing, where you can control every part of the process with some degree of certainty. Service work deals with unpredictable people. Thus, Leidner shows how service organizations not only seek to control their employees but also the customers themselves through socialization and cues (e.g. queuing). Her research makes it apparent how much of everyday life in organizations is scripted and controlled.
The other, probably less examined, method of variety reduction is through selection processes. Organizations work very hard to get the right people in (or out of) their organizations. Organizations want to hire people who will not disrupt the flow of work or challenge the identity of the organization. My new colleague, Lauren Rivera, looks at how professional organizations, like law and consulting firms, look for signals and symbols such as one’s hobbies to determine a potential employee’s cultural fit in an organization. Her findings suggest that assessing fit during the hiring processes induces intra-organizational homophily. In other words, organizations end up reproducing themselves by hiring the same kinds of people.
Of course, this isn’t to say that organizations don’t benefit from embracing some diversity. I fully believe that many organizations hamper their own effectiveness by becoming overly-obsessive about variety reduction. There is a lot of recent research that shows the value of employee diversity in organizations. For example, see Cedric Herring’s ASR article. Diversity, among other things, can really boost the innovativeness of an organization. My main point is to show that organizations almost inevitably reduce variety once organizing processes kick in even when they intend to create a diverse workforce.
Good point. My favorite version of this idea is Coase’s Theory of the Firm. Firms are designed to standardize contracts and eliminate the volatility of markets. It’s also a point brought in many other contexts. There is a place for creativity and diversity, but most orgs are designed for the opposite task – routines.
fabiorojas
July 15, 2009 at 6:42 pm
I’m obviously biased on this question — but I really don’t think we’ve fully come to terms with the issue of variety reduction. First, if we operate at the org-environment level then the specifics of how the (intra-org) variety-reduction occurs do not really get surfaced. That’s fine I suppose, but then if we take the org-level itself, most of our theories are about variety-reduction at the level of populations of orgs (via institutions, pressures from env’t, etc), but then we don’t answer the question of the heterogeneity between organizations (why not one large organization then — Coase’s brilliant question — which we seemingly presume when we expand levels to networks, populations etc, without specifying org boundaries). Anyway, I suppose for the purposes of any given study we can make assumptions and thus do not have to wrestle with these issues, though I think there is a sweet spot of opportunity to study matters related to how variety reduction occurs (unpacking things like “socialization”), the collective actors (orgs) themselves and their path-dependent actions, identity and boundaries maintenance and so forth.
tf
July 15, 2009 at 7:02 pm
[...] OrgTheory: variety reducing organizations favorite org theory books of the last twenty [...]
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