seven open orgtheory problems

It’s very important for scientists to tackle important puzzles. So I got to thinking: what are important puzzles in organization studies? Here’s a few. I focus on puzzles generated by empirical observations, not “theory driven” puzzles (e.g., how do institutionalists explain social change). In no particular order:

  1. The M-form: Why is the M-form so robust? There have been claims that we’ll switch to team centered organizations, or flattened hierarchies, or open source internet based organizations, or whatever – but it hasn’t happened. Why? If we have switched, what sorts of industries require M-forms? Just manufacturing?
  2. The consulting profession: How can you characterize the consulting business? What range of activities count as consulting? Why do firms bother? When do consultants create value? When is it ritual?
  3. Executive compensation: Is there any “rational” way to link corporate performance to pay? Is there any way to overcome principle-agent problems for executives and retain the pay-performance link?
  4. Public-private hybrids: Some organizations, like universities, are essentially multi-sector hybrids. When does that happen? What factors predict the emergence of hybrid organization structure?
  5. The regulatory regime of American finance: Were changing de/re-regulations of finance in the 1990s and 2000s a case of industry capture or economic theory? In other words, did the change in the finance sector follow a theory of what finance should be, or was it the industry controlling the regulators?
  6. Finance’s power: Will the recession decrease the authority of finance professionals in American business? (I.e., Will it reverse Fligstein’s findings?)
  7. How has the Internet changed political organizations? Is it just one tool in the service of traditional politics? Or is there a new politics associated with online life?

Add your own problems and responses in the comments.

Written by fabiorojas

April 28, 2009 at 3:17 am

Posted in fabio, mere empirics

21 Responses

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  1. Fabio: To appease Peter — you really need to add these two: 1) the structure-agency problem, 2) definition of institution.



    April 28, 2009 at 3:32 am

  2. Which Peter? Evil economist Klein or soc of market dude Levin?



    April 28, 2009 at 3:38 am

  3. The one that hates you…



    April 28, 2009 at 3:39 am

  4. Wait, that doesn’t help either.



    April 28, 2009 at 3:39 am

  5. No, that helps. One merely mocks me. Thanks.



    April 28, 2009 at 3:42 am

  6. Here’s the reference:

    Sorry — hopefully I did not ruin the conversation.



    April 28, 2009 at 3:45 am

  7. Yeah, I saw that before. And nothing can ruin my day – I just finished watching the sublime conclusion of Buffy the Vampire Slayer, season 3. Perhaps some of the best television around. Seriously.



    April 28, 2009 at 3:49 am

  8. 1. Large organizations don’t tend to work without hierarchy, and jobs don’t get done unless they’re someone’s responsibility. Your alternatives are wildly utopian (for all but Google).

    I don’t know much about this, but it seems to me that this form is found in tandem with oligarchies. Chaebols, zaibatsus, the Indian business houses–all seem to have (at least superficially) similar structures. Of course, many of these are in manufacturing, but Taiwan and China manufacture too, and very differently. Those countries have freer competition though. Economist/sociologist synergies may help tackle this issue.

    2. Those consultants that offer specialized services (outsourcing, legal, pricing) add value. The rest don’t. As in Office Space, some are there to do dirty work, others are there to voice the unpleasant thoughts (like when countries call the IMF to do necessary reforms, and blame them), others are there to make somebody look good. Any industry in which the primary input is Ivy League grads does not add value.

    3. It’s hard to deny top earners what they are worth. If you want to try, give them stock and don’t let them sell for ten years. In finance, hold money in escrow and take it back if the firm does badly.

    4. Happens generally when private actors figure out how to suck government money. See: the defense industry. Will likely happen next to healthcare.

    5. I think there was a real sense in which people became psychologically tied to the state of finance. Summers, Greenspan and so forth. They sincerely believed they were doing good (and it’s not at all clear that ‘deregulation’ was the problem anyway).

    6. Of course it will. More interestingly, what will happen to the wage premium for elite undergraduates, MBAs, and quants? How much of the gains to skilled labor was a complete mirage?

    7. More of the same. People don’t associate primarily online (at least on non-video game platforms). Also, young people will never be a large voting demographic.

    My questions:

    8. How are vastly improved communication channels changing organizations (facebook, twitter, broadband, blackberry, etc)?

    9. What kind of impact has the computer had? Is it possible to get people to actually work on them instead of surfing the internet all day?

    10. Young people have vastly different skills, habits, and preferences. How can organizations make best use of this?



    April 28, 2009 at 7:05 am

  9. I am far from being expert, but reading that list I felt it is too American-based. items 5 and 6 are certainly so, and more arguably so are 3,4 and even 2. If not american, certainly western.
    But I see orgtheory as a study of organizations in general, not necessarily firms in an industrial society. Are there commonalities between organizations around the globe? to what extent can we generalize our questions (as opposed to our answers), so that what we say on organizations in the U.S. can make sense to other organizations? Is the limit to that extent signifies deep, inherent differences in the concept of “organization”, or maybe they are the result of long, path-dependent but rather arbitrary choices?

    It is either may naive nature, or the fact that I missed few orgtheory classes, but somehow I find myself thinking about these more than CEO pay, which seem to me like a very special case of something important. Not sure what, though.



    April 28, 2009 at 7:53 am

  10. Here’s my current problem: sensemaking vs. decision-making? Is it true that no-one ever really makes decisions and/or that decisions are not important determinants of organizational outcomes?

    Related: the relative importance of (corporate or organizational) policy and local, on-the-ground sensemaking processes for the development of organizations.

    Related: planning and strategy vs improvisation and bricolage.

    Related: how important is top management? (This connects to executive compensation, of course; but also to ethical issues, like the responsibility of top management in times such as these.)

    (Some of these puzzles actually occur across some pretty serious methodological and theoretical boundaries, which makes them difficult to articulate, let alone solve.)


    Thomas Basbøll

    April 28, 2009 at 1:44 pm

  11. “Executive compensation: Is there any “rational” way to link corporate performance to pay? Is there any way to overcome principle-agent problems for executives and retain the pay-performance link?”

    A possibility that has intrigued me is that of forcing organizations to report more of their raw data to the public. Accountants will still be needed for summarizing and reporting to both managers and investors, but by “open sourcing” accounting, the opportunistic behavior — which, in the end, every manager gest suckered into in order to keep up with the competition — should be reduced.

    When the public only gets cash-flow information on a quarterly basis, trends in growth or decay can only be spotted on a semi-annual basis!

    The corollary is that when so much control over what is reported is in the hands of management — and it is since we make up for the paucity of information between quarterly statements with additional projections from management — the competition that is supposed to be among organizations turns into a competition among managers, with nasty results on the average character of managers over time. See additional rumination here.


    Michael F. Martin

    April 28, 2009 at 2:15 pm

  12. Whoa, some feelings are being attributed to me that I’m not on board with.



    April 28, 2009 at 2:34 pm

  13. Come on, Peter…just go with it, we’re trying to create some controversy here.



    April 28, 2009 at 4:45 pm

  14. Yeah, Peter – don’t you know that all bloggers need enemies? Think Tupac and Biggie. We could have a shoot out at ASA.



    April 28, 2009 at 5:11 pm

  15. Oh,boy! Oh, boy! Tertius gaudens ! Somewhere Simmel is smiling.



    April 29, 2009 at 3:04 am

  16. I suspect that the robustness of the M-form results, in large part, from the degree to which large hierarchical institutions are insulated from the competitive ill effects of hierarchy.

    So-called “intellectual property” is currently the main structural support to corporate boundaries, in a world where the importance of physical relative to human capital is imploding. And that’s only one of many forms of regulatory cartelization.

    The cumulative effect of this legal framework is to shoehorn the network organization, where it exists, into an old corporate framework where the corporate HQ still controls finance, marketing and branding. See Lewis Mumford on the “cultual pseudomorph” in Technics and Civilization.


    Kevin Carson

    April 29, 2009 at 3:11 am

  17. Saw this post on Bourdieu and Geithner at baseline scenario. Thought y’all would like to see it.



    April 29, 2009 at 1:11 pm

  18. How has the Internet changed political organizations? Is it just one tool in the service of traditional politics? Or is there a new politics associated with online life?

    I agree that this is going to be a really important area of study in the future. In talking about how protests get organized with activists, it’s pretty clear that Facebook has turned into the medium of choice given its flexibility and relational scope. If nothing else Facebook helps cut down the coordination costs of collective action, but I suspect there’s an identity element to the story as well.

    So why don’t we have very many studies about the impact of the internet on other sorts of organizational decision-making and/or organizing? Most of the studies that look at organizational life and the internet that I’ve seen tend to look at the counterproductive aspects of the internet (e.g., lost hours of productivity due to blog reading). What about the efficiency-enhancing aspects of online coordination? Anyone?



    April 29, 2009 at 2:55 pm

  19. Brayden-

    I feel like there is a lot that is at least descriptive or celebratory of lowering the coordination costs for civil society or political organizations. You mean more rigorous, empirical research? And do you mean campaign organizations (as oppose to governing or politically engaged?)

    A few things I pulled off my shelf-
    ,i> Mousepads, Shoe Leather, and Hope: Lessons for Dean Campaign for the Future of Internet Politics Techout, Zephyr and Streeter,Thomas. Has stories from campaign and some framing/theory chapters.

    Society Online Edited by Howard, Philip and Jones, Steve. Has a chapter on voting and Internet in politics 1996-2000 (wow! Pre-history!).

    Globalization from Below: Transnational Activists and Protest Networks della POrta, Donatella et al. Has a Chapter on Networks and Organizing.

    Causewired By Watson, Tom. Whole book is rah-rah on wired activism. HAs chapter on politics (6, I think).

    The Media in the Network Society: Browsing, NEws, Filters, and Citizenship Several chapters on politics, political systems, case studies of other countries (East Timor, Portugal e.g)

    Is any of this on the mark?



    April 30, 2009 at 5:18 pm

  20. […] Question: How has the Internet changed political organizations? Is it just one tool in the service of traditional politics? Or is there a new politics associated with online life? […]


  21. One that I will throw out but that may be the same as hybrids that Fabio suggests, or may not be there in terms of facts on the ground.

    Is the civil society competing with markets and the “normal” economy? I feel like I have seen figures around raw growth globally. More profoundly, are social innovation and entrepreneurship activities able to create new business models that rely on social purpose to outcompete “purely” profit-seeking firms?

    Similarly, will the financial fall-out and the rise in global networked activism spawn a new wave of experimentation with structure and ownership? I’m thinking return of co-ops, emergence of open source production, turn towards employee ownership in some US and Western firms and so on.



    April 30, 2009 at 5:51 pm

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