Formal Organizations: A Comparative Approach 9780804767361

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Formal Organizations

stanford business classics Jeffrey Pfeffer and Gerald R. Salancik, The External Control of Organizations: A Resource Dependence Perspective Raymond E. Miles and Charles C. Snow, Organizational Strategy, Structure, and Process

Formal Organizations A Comparative Approach

Peter M. Blau and W. Richard Scott

stanford business classics Stanford Business Books An imprint of Stanford University Press . Stanford, California . 2003

Stanford University Press Stanford, California © 2003 by the Board of Trustees of the Leland Stanford Junior University. All rights reserved. Printed in the United States of America on acid-free, archival-quality paper. Library of Congress Cataloging-in-Publication Data Blau, Peter Michael. Formal organizations : a comparative approach / Peter M. Blau and W. Richard Scott p. cm. — (Stanford business classics) Originally published: San Francisco : Chandler Publishing Company, 1962. Chandler publications in anthropology. With new introd. New introduction includes biographical and professional data for both authors. Includes bibliographical references and indexes. ISBN 0-8047-4890-X (pbk. : alk. paper) 1. Comparative organization. 2. Associations, institutions, etc. I. Scott, W. Richard. II. Title. III. Series. HD31 .B53 2004 302.3'5—dc22 2003015350 Originally published: San Francisco: Chandler Publishing Company, © 1962 Original Printing 2003 Last figure below indicates year of this printing: 12 11 10 09 08 07 06 05 04 03

Contents

List of Tables Introduction to the Classic Edition Preface 1.

2.

3.

4.

Introduction

vii ix xvii 1

The Concept of Formal Organization The Study of Formal Organizations Methods in the Study of Organizations The Comparative Approach

2 8 15 25

The Nature and Types of Formal Organizations

27

Theoretical Concepts Typologies of Formal Organizations Types of Formal Organizations Concluding Remarks

27 40 45 58

The Organization and Its Publics

59

Professional and Bureaucratic Orientation The Public Conflicts with Clients Concluding Remarks

60 74 81 85

The Social Structure of Work Groups

87

Informal Organization Effects of Group Structure The Larger Organization and Work-Group Structure Concluding Remarks

89 100 108 115

vi

5.

6.

7.

8.

9.

Contents

Processes of Communication

116

Experiments on Communication and Performance Field Studies of Communication in Formal Organizations Variations in Communication Patterns Concluding Remarks

116 128 134 139

The Role of the Supervisor

140

Styles of Supervision Supervision and Performance Hierarchical and Peer Relations Concluding Remarks

141 150 159 163

Managerial Control

165

The Hierarchy Impersonal Mechanisms of Control Questioning Some Prevailing Assumptions Concluding Remarks

167 176 183 192

The Social Context of Organizational Life

194

The Social Environment of Organizations Organizational Analysis Interorganizational Processes Concluding Remarks

195 206 214 221

Organizational Dynamics

222

Organizational Development Emergent Patterns Dilemmas of Formal Organization Dialectical Processes of Change

223 234 242 250

Appendix. Description and Comparison of the Two Welfare Agencies Bibliography Index of Names Index of Topics

254 258 303 306

Tables

1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11.

Location of Reference Groups and Graduate Work Type of Orientation and Professional Characteristics Type of Orientation and Loyalty to the Agency Type of Orientation and Criticism of the Agency Type of Orientation and Criticism of Administrative Policies Seniority, Informal Acceptance, and Orientation to Clients Seniority, Popularity, and Reference Group Group Climate, Individual’s Orientation, and Attitudes Group Climate, Acceptance, and Individual’s Orientation Group Cohesion, Popularity, and Reaction to Clients Reciprocity in Consultations, Work Pressure, and Per Cent Regularly Consulting Colleagues 12. Reciprocity in Consultations, Self-Confidence, and Per Cent Regularly Consulted 13. Worker Visits to Recipients and Orientation of Supervisor 14. Supervisor’s Self-Confidence, Supervisor’s Approach, and Worker Loyalty

67 68 69 72 73 97 99 102 106 108 136 137 155 158

Introduction to the Classic Paperback W. Richard Scott Stanford University

The reprinting of Formal Organizations: A Comparative Approach, first published in 1962, is a most happy event for me, and I’m sure that my senior coauthor Peter M. Blau would have been equally pleased. Sadly, he died on March 12, 2002 at the age of 84. He was unquestionably one of the leading sociologists during the last half of the twentieth century, as well as a key figure in shaping the modern field of organizational sociology. In this introductory essay I first describe, briefly, Blau’s and my biographical history up to the time when Formal Organizations was written, and, at greater length, the intellectual context out of which this work developed. I then describe the somewhat unusual collaborative process that produced the book. Next I identify the central contributions of the book and note some ways in which we paved the way for later developments. Finally, I comment briefly on the publication history of the book and on some of our subsequent work.

Context of the Work Personal Background There could hardly be a greater disparity of personal experience and social/cultural background than that marking my own development and that of Peter Blau. He was Jewish and cosmopolitan; I, Protestant and provincial. He experienced at first hand Nazi tyranny and was involved in the events leading up to and including World War II; I was living safe in middle America at this time and too young to be directly affected by these horrendous events. On the other hand, both of us got our intellectual start in small-town college settings; and we both were fortunate enough to pursue graduate work at places of great

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scholarly distinction and during periods of high intellectual excitement—Columbia of the 1940s and Chicago of the 1950s. And both of us shared the vision of creating an empirically based, comparative theory of organizations. Peter Blau was born in Vienna in 1918, the son of secular Jews. He and his family watched with anxiety and horror as the Nazis came to power in 1938. His parents chose to stay in Vienna—and subsequently died in Auschwitz in 1942—but Peter tried to escape over the Czech border, was captured, tortured, and released, and eventually fled to Prague when Hitler invaded Czechoslovakia. With the assistance of a high school teacher, Fritz Redl, Peter was able to obtain a visa for immigration to America. He was detained in France by the French army (he was carrying a German passport), but was finally able to secure passage to America from Le Havre. While waiting for his ship to arrive, he had the great good fortune to meet U.S. travelers in Europe who were looking for a candidate eligible to receive a scholarship designed to enable a Jewish refugee to attend the small religious college of Elmhurst, in Illinois. He was selected for this scholarship and completed his undergraduate work at this institution. In 1942, he enlisted in the American army and served three years in the European theater as an interrogation officer (Blau 1995; Footnotes 2002). Following the end of the war, with the help of the GI Bill, Blau pursued graduate work in the Department of Sociology at Columbia University. Joining an exceptional cohort of students—including Philip Selznick, Seymour Martin Lipset, Alvin W. Gouldner, Peter Rossi, and James S. Coleman—Blau quickly fell under the influence of two younger faculty members, Robert K. Merton and Paul Lazarsfeld. Merton emphasized the value of “middle-range” theories—the development of theoretical propositions formulated at levels that allowed empirical verification—and Lazarsfeld was instrumental in developing methods to enable multilevel analysis—examining the effects of macro systems on micro processes (Merton 1949; Merton and Lazarsfeld 1950). Merton’s substantive interests included attention to the nature and influence of bureaucratic structures on work processes (Merton 1940; Merton et al. 1952). Stimulated by the translation into English of Max Weber’s studies of bureaucracy, Merton inspired and guided his graduate students as they carried out a set of theoretically informed empirical studies of diverse organizational forms including those of Selznick (1949), who studied a public enterprise; Gouldner (1954), who examined a gypsum mine and office; Lipset, Trow, and Coleman (1956), who examined a union; and Blau (1955), who investigated departments within a state and a federal agency. Many years later, Merton (1990) provided a detailed description of the process involved in “the making of a sociological dissertation classic,” as he recalled the events associated with the writing of Blau’s dissertation, published as The Dynamics of Bureaucracy (1955). I discuss the importance of the Columbia contribution to the development of organizational sociology later in this introduction. I was born in Parsons, a small town in southeast Kansas, in 1932. For fi-

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nancial reasons, I attended two years of junior college in my hometown and then transferred to the University of Kansas (KU) as a junior, having secured a residential scholarship. I “discovered” sociology in my senior year, and with the aid of a Woodrow Wilson Fellowship, remained at KU to complete my master’s degree. Charles K. Warriner, a faculty member at KU and a former student of social anthropologist W. Lloyd Warner at the University of Chicago, introduced me to the subject of organizations and gave me my first taste of empirical research by hiring me on a project to study the organizational structure of a hospital in the Kansas City area. I completed my MA thesis research at this site, conducting a study of the professionalization process involving student nurses (Scott 1955). When it was time to select a school for further graduate work, all members of the sociological faculty at KU with whom I consulted agreed that, if admitted, the place for me to go was the University of Chicago. Peter Blau came to the University of Chicago as an assistant professor in 1953, having taught briefly at Wayne State and at Cornell University. Although at that time the University of Chicago had suffered a number of significant faculty losses—Ernest Burgess and W. F. Ogburn had retired, Louis Wirth had died, and Herbert Blumer had moved to the University of California, Berkeley—Chicago was soon restored to intellectual vigor with the arrival of Peter Blau, followed by Peter Rossi, Elihu Katz, and James S. Coleman. I arrived as a first-year doctoral student in 1955. I had received a first-year fellowship from the university, and my wife, Joy, took a position as assistant librarian in the Laboratory High School of the University. I worked for two years as a research assistant for Otis Dudley Duncan, coauthoring my first book with him and other colleagues on the structure of metropolitan communities in the United States (Duncan et al. 1960). In the meantime, I took courses and seminars with Blau and, convinced of the importance of organizational studies, made the difficult transition—in both intellectual and personal terms—from working with Duncan to working with Blau. As a follow-up on his dissertation study of bureaucratic behavior, Blau had begun an investigation of the organization of work and of work groups within the Chicago Department of Social Welfare (“City Agency”). Consistent with the topic of my MA thesis, I was interested in conducting a study of the tensions between professional workers and organizational controls. As we talked about a possible research site, Blau suggested that I might consider studying a different social work agency because, if I included some of his questions in my survey, we could combine our data and conduct a comparative study of the two organizations. Of course, I was flattered and excited by this possibility. I was able to gain permission to study the Lake County Department of Social Welfare in Gary, Indiana (“County Agency”), and I received a Social Science Research Council Fellowship to support my dissertation research, which commenced in 1959.

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Intellectual Context The modern form of organization studies came into being during the 1950s, and its midwives were predominantly American social scientists (March 1965: ix– xvi; Scott 2003: 9–11). This is not to say that no previous work on this topic had been carried out, or that scholars prior to mid-century had not been aware of the distinctive properties of organizations, but that organizations had not heretofore been the center of attention. Nevertheless, five streams of early theory/research provided important components for the construction of organization studies. Managerial Studies Commencing at the end of the nineteenth century and continuing up to the present time, many scholars focused on the problem of how best to design efficient work structures. The early impetus for this approach came from members of the engineering community, who were fixated on the problem of how to rationalize the production process—beginning with the design of parts and tools, but then shifting to the activities of workers and the design of larger organizational systems (Ward 1964; Shenhav 1999). The principal advocates of this approach—Taylor (1947); Fayol (1949); and Gulick and Urwick (1937)— stressed the importance of explicit design of parts and activities (formalization), division of labor (differentiation and specialization), and coordination (including impersonal rules and hierarchical controls). Organizations were treated primarily as production systems, and analysts sought ways to enhance their rationality. (For a review, see Scott 2003: 33–43.) During the 1930s, other scholars began to challenge the view that organizations were simply technical instruments and that participants were exclusively utility-maximizing actors. Together these critics crafted a more socially embedded, “human relations” orientation that emphasized (1) the complex motivational frameworks that guide social actors; (2) the importance of “informal” structure—interpersonal ties of friendship and normatively defined expectations; and (3) the structuring of conflict—between workers and managers, and among various segments of workers and managers—that govern choice and behavior by organizational participants. Although the social aspects of work systems were stressed, much attention was given to how managers could exploit this knowledge to enhance productivity (Roethlisberger and Dickson 1939; Mayo 1945; Dalton 1959; for a review see Scott 2003: 56–66). Industrial Sociology Beginning in the 1940s, a broader intellectual framework developed that attempted to integrate changes in work, including technological and industrial systems, with changes in broader social structures—stratification and class systems and power structures, ranging from community to societal arrangements. Reviving the early interests of Marx (1976/1847) and Durkheim (1949/1883),

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these analysts examined the interdependence of multiple systems affecting and affected by work, including education and training programs, occupational systems, and, of course, organizations. Factories and other types of firms were of interest, but attention was also devoted to unions and related forms of workers’ associations (Moore, 1946; Miller and Form 1951). Pursuit of these broader issues continues up to the present under the rubrics of industrial sociology or the sociology of work (e.g., Tilly and Tilly 1998). Group Studies Social psychologists and sociologists also commenced their studies of interpersonal and group behavior during the 1930s and 1940s, examining such topics as the effects of varying types of communication systems and leadership patterns on performance. These studies were conducted both in natural settings, such as play and work groups, as well in the laboratory, where stimuli and conditions could be controlled (Bavelas 1950; Kelley 1951, Roy 1952). Organizational Case Studies Throughout most of the 20th century, scholars conducted case studies of organizations. Research was carried out, for example, on mental hospitals (Stanton and Schwartz 1954), political parties (Gosnell 1937), prisons (Clemmer 1940), and corporations (Drucker 1946). However, most of these researchers made no attempt to generalize beyond the specific type of organization they were studying. The subject was “prisons” or “hospitals,” not “organizations.” Studies of Bureaucracy Max Weber, the great German scholar working at the turn of the last century was, of course, the preeminent observer of the rise of rationalized administrative systems—bureaucracies—in both public and corporate organizations. His classic account of the replacement of traditional with bureaucratic structures had an important effect on American scholarship when this work was translated in the late 1940s (Weber 1946/1906–1924; 1947/1924). Weber treated his analysis of administration primarily as a well-documented instance of a more general phenomena: the rationalization of modern societal structures. But, as noted above, Robert Merton at Columbia University was instrumental in mobilizing a collection of young scholars, including Blau, to closely examine these organizations as important new forms, attending to their structure and their effects— both intended and unattended—on participants’ actions.

Immediate Precursors The foregoing brief review suggests that much work of interest was under way by 1950. However, little of it was coded as organizational research—with scholars viewing organizations as a distinctive type of collectivity worthy of

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scientific study. Several key contributions provided the needed impetus to creating a new field of study. The first involved substantive improvements in administrative and managerial studies. Stimulated by the work of Barnard (1938), an executive who worked to bring together more rational system approaches and human relations insights, Herbert A. Simon (1945) created a theory of administrative behavior that gained much attention. His approach departed from the earlier proverbs and prescriptions that marked much administrative theory to develop an analytical model of “boundedly rational” actors whose decisions and actions could be supported by administrative structures simplifying tasks and supporting decision making. This work was pursued by Simon and his colleagues at the Carnegie Institute of Technology (now Carnegie-Mellon University). The most important early fruit of this collaboration was March and Simon’s Organizations (1958). This still-influential work begins with the ringing assertion that the high specificity of structure and coordination within organizations—as contrasted with the diffuse and variable relations among organizations and among unorganized individuals—marks off the individual organization as a sociological unit comparable in significance to the individual organism in biology. (1958: 4)

A second important landmark in the development of the fledging field was the initiation, in 1956, of a scientific journal, Administrative Science Quarterly, devoted to organizational research. Founded by James D. Thompson and Edward Litchfield at Cornell University, this journal quickly became the flagship journal of the field, nurturing multidisciplinary approaches and providing a valuable forum for the growing number of organizational researchers. Third, the collection of scholars at Columbia University in Merton’s circle made numerous important early contributions. Selznick not only conducted influential case studies of a public bureaucracy (1949) and a political party (1952) but wrote general essays about the nature of bureaucracy and the theory of organizations (1943, 1948). In addition to his examination of a gypsum factory and mine, Gouldner (1954) wrote a seminal review essay on organization theory for an early handbook (1959). And a student of Selznick and Lipset (now both on the faculty at the University of California, Berkeley), Amitai Etzioni, developed a cogent typology of organizational structure (1961a) and edited a collection of articles and papers under the title Complex Organizations: A Sociological Reader (1961b). Such was the lively scene at the time when Blau and I were conducting our research and beginning to write our book.

The Collaborative Process Much of my writing has been carried out with colleagues, but the writing process that produced Formal Organizations was like no other. By some mira-

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cle, I kept and was able to locate much of the correspondence between Blau and myself attending our joint work. Of course, the writing was preceded with a period stretching well over a year (1959) when we each completed our separate studies. As noted, these studies had somewhat differing foci, but we early agreed to include a number of items in common in the questionnaires we administered to staff members. We then determined areas of overlap and carried out parallel analyses of these data. The technical resources available at this time to support such work were primitive by today’s standards. Most of the data was encoded on IBM punch cards that were arrayed with the aid of a counter-sorter; the analysis was carried out on a calculator. My wife and I left Chicago in December of 1959, driving across the country to California so that I could accept a position as assistant professor in sociology at Stanford University, beginning January 1, 1960. Before leaving Chicago, Blau and I produced a one-page outline of the book. The core chapters of that five-chapter outline focus on the reporting of our combined studies, including orientation of officials, work groups, and authority systems. At this stage, we were planning to write a simple research monograph that would report the results of our two studies. However, as work proceeded on the project, our outline began to expand to include other topics of interest but outside the scope of our studies. We began to view our book as providing a general introduction to and overview of the fledgling field of organizational studies. Our work was genuinely collaborative, although Blau was clearly the senior and I the junior colleague. In a letter dated January 1, 1960, I wrote the following: Dear Peter: It is only with almost 2000 miles between us and the help of some New Year’s Day cheer that I have been able to muster up enough courage to call you by your forename.

By April, Blau was beginning to enlarge his conception of the project: I now tend to think of a general systematic survey of complex organizations, using the comparative analysis simply a little more intensively than the many other studies we plan to bring together.

He indicates that he is starting on an outline for this, and encourages me to send him a list of major topics from the books I had read that I found interesting as well as the central topics of my dissertation. He also urges me to get as far along on my dissertation as possible, leaving the summer months free to concentrate on the book. (I completed my dissertation only after the book manuscript was completed [Scott, 1961]). With the cooperation of my new departmental colleagues, I was able to arrange a visiting teaching appointment for Blau for the summer of 1960. He

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arrived in early June, was given an office next to mine, and we were off and running. (Running is the proper term. When Blau thought, he paced furiously, and I had to sit on a desk in his corridor-like office to keep from getting run over as we talked.) Rather than working out a division of labor by topics with each assuming primary responsibility for some part of the work, we co-wrote all chapters in an iterative fashion. Our procedure was to talk together about the outline of each chapter. Then Blau would prepare a detailed outline from which I was to write the first draft. Blau next reviewed and revised my draft and returned it to me for additional corrections and improvements, and so on, back and forth until both of us were satisfied. Blau was eager to get as much of the manuscript completed as we could during that summer. His hope was to have a rough draft of the entire manuscript ready by September 30. To help achieve this (unrealistic) goal, Joy and I spent September in Chicago (where I shared an office with Mayer Zald). In spite of our best efforts, the work continued into the fall, and I returned to Stanford. This being the age of typewriters, carbon paper, and surface mail, our collaboration was often slowed while we waited for a revised chapter to arrive. Blau was ruthless in his revisions but encouraging in his comments. After making a series of changes on one of my drafts, he wrote: I do not want you to feel that the fact that there are so many changes implies that I am critical of your work. Or, I should say, I am critical of your work, nearly as critical as I would be if the first draft had been written by myself. Seriously, I can only repeat that I think our collaboration worked really wonderfully well, much better than I had dared to hope, and I do think that our relationship is now close enough so that it can stand the strain of our criticizing one another in making these revisions . . . Now it is again your turn. I haven’t made changes lightly, but I am sure they deserve again a very thorough revision. This doesn’t mean necessarily that you should do much revising, but that you should do as much revising and improving as you think is necessary. If something is unclear, it has to be changed . . .

And so we continued to work through the fall and into the holidays. I mailed the penultimate draft of the manuscript to Blau on January 25, 1961, and he finished his final reading on February 11, 1961. His letter to me on that date concludes, “I think we have a good book.” But, characteristically, he expressed reservations, worrying that “the level of difficulty varies greatly” and that “while we did quite a good job of integration and presentation of specific research findings on the welfare agencies and the survey of the field,” there are “lots of places where we have no comparative material, and, more serious, quite a few findings that the second study did not replicate.” The correspondence reveals a man of high standards, particularly in relation to this own work, but also a supportive teacher and mentor, anxious to involve a junior colleague in the creative process.

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Contributions With the gift of hindsight and from much time having passed, I note some ideas and arguments we made that many have found to be of value in guiding the development of the field.

Actors As Well As Contexts Blau and I were determined to focus analytic attention on organizations as a form of collective actor, not simply as a context affecting the behavior of its members. Blau (1957, 1960) was in the forefront of the movement to lift the level of analysis from the more micro focus on individuals or groups that had dominated sociological work on organizations to the more macro attention to organizations qua organizations. In retrospect, the subtitle of our book, Formal Organizations: A Comparative Approach, was rather audacious since we ourselves had studied only two organizations. Nevertheless, we used our precious data set with an n of two to justify the examination of those other few studies that had included data from more than one organization, and as a megaphone to advocate more such studies. We called attention in particular to the pioneering studies of Stanley Udy (1959a, 1959b), who employed qualitative field notes from anthropological studies assembled in the Human Relations Area Files in order to test Weber’s arguments regarding the correlation among various “bureaucratic” characteristics in administrative structures of production organizations. Our work anticipated and paved the way for a generation of studies focusing on the determinants of structural variation in organizations. This type of research requires the collection of data on a large sample of organizations. The two major efforts of this type during the 1960s were those carried out by the “Aston” group in England, who studied a varied sample of organizations within the Birmingham area (Pugh et al. 1968, 1969) and a series of studies carried out by Blau himself together with a number of collaborators who examined, variously, manufacturing firms (Blau et al. 1966), state employment agencies (Blau and Schoenherr 1971) and universities (Blau 1973). Later studies of this type by others enlarged their scope to include samples of similar organizations in differing societies: for example, Lincoln and Kalleberg’s (1990) study of manufacturing organizations in comparable cities within the United States and Japan; or, to develop a sample of organizations representative of those in the larger society, for example, the study by Kalleberg and colleagues (1996) of a sample of U.S. organizations.

Cui Bono? As a way of capturing important differences among types of organizations, Blau and I developed a typology focusing on the question of cui bono?: who benefits? Noting that numerous categories of persons can be identified that re-

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late to organizations in diverse ways, we pointed out that organizations vary in which category they define as their primary beneficiary. We distinguished among (1) the members or rank-and-file participants; (2) the owners or managers; (3) the clients or “public-in-contact”; and (4) the “public at large,” members of the society in which the organization operates. Organizations placing the interests of their rank-and-file members uppermost were termed mutual benefit organizations, for example political parties, unions, fraternal associations. Organizations serving the interests or owners or managers were termed business concerns. Those in which the public-in-contact received primary attention were termed service programs, for example, medical clinics, and whose serving the interests of the public-at-large were labeled commonweal organizations, including most public agencies. We argued that each type of organization exhibited distinctive features and that each type was associated with different kinds of problems or pathologies. In their recent essay, Hinings and Greenwood (2002) cite this typology as an example of scholarship emphasizing the consequences of organizations for the larger society. Ours was one of a number of typologies proposed to call attention to important fault lines that differentiate organizations into subspecies. Other influential frameworks include those developed by Etzioni (1961a), focused on control systems, Parsons (1960), emphasizing societal functions, and Thompson (1967), focusing on technology. (For a review of organizational typologies, see Scott 1981, chapter 2.) The cui bono typology built on the Barnard-Simon framework of inducements-contributions—the contributions by some participants provide the inducements for others—and, by focusing on the multiple classes of participants associated with organizations, anticipated the contemporary development of a “stakeholder” theory of organizations (Harrison and Freeman 1999; Clarkson 1995).

Contextual Effects Using a set of methodological techniques developed by Lazarsfeld, Blau and I made extensive use of contextual analyses in our study. These methods allow researchers to employ aggregated survey data to characterize collective norms, beliefs, or relational systems and, taking into account an individual’s own opinions or social location, examine the independent effects of some feature of the wider system on that individual’s behavior. Such approaches expose the complex layering of social structures, as organizational features influence group structures, which in turn affect individual behavior and attitudes.

Communication Patterns As noted in the review of earlier work, a considerable amount of research —both field and experimental studies—had already been carried out exploring the effects of hierarchy on communication, and we set out to summarize and

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synthesize this literature. We noted that studies indicated that hierarchical differentiation aids rapid response and coordination of efforts when relatively simple and well-understood tasks are involved, but when complex tasks are involved, more egalitarian structures enable problem-solving. We suggested that the mechanisms at work here included the sifting of suggestions from many, offering social support, and engendering competition among members for respect, which mobilizes task energies (Blau and Scott 1961: 121). The effects— both functions and dysfunctions—of hierarchical structure remain a central theme in organization studies.

Authority and Leadership Blau and I took considerable pain to integrate conceptual and empirical work on formal authority structures with the extensive work on informal leadership. Social psychological studies emphasized the importance of leadership traits and of interpersonal relations and group norms legitimating influence attempts. Sociological studies examined the importance of formalization in creating authority positions and the changing rationales that justified the differential access to and exercise of power. We reviewed, evaluated, and examined the interplay of both sets of arguments. We also examined the use of control techniques in organizations that did not rest on personal influence or positional authority. For example, in production systems much coordination and control is vested in the technology employed, most dramatically in the case of assembly line systems. In office systems, control resides in the forms that direct information gathering and decision making, and in the statistical records that summarize the amount and quality of work performed. The combined use of both personal and impersonal control systems represents a distinctive feature of formal organizations.

Beyond the Boundaries More so than most treatments of organizations at that time, we devoted considerable attention to the wider social context within which organizations operate. The main thrust of open systems theory had not yet reached organizational studies (see Scott 2003, chapter 4), but we were attentive to many of the ways in which the environment of organizations affects their structure and performance. We also anticipated some of the important emerging levels of analysis. For example, drawing on Merton’s concept of “role set,” we developed the concept of “organization-set” to refer to the “various other organizations to which any one organization is related” (Blau and Scott, 1961: 195). This concept was adopted and usefully developed in later research by Evan (1966). Our discussion also prefigured the approach pursued by population ecologists, as we considered the competitive relations that arise between organizations of the same type (members of the same population), the emergence of dominance patterns,

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and the ways that such competition may give rise to differentiation, resulting in stable patterns of exchange. Blau (1964) later elaborated these arguments in his important book on exchange and power; and organizational ecologists, such as Aldrich 1979) and Hannan and Freeman (1977) pursued the study of ecological processes shaping populations and communities of organizations.

A Broad Tent One of the more noteworthy features of our book was our inclusion of a quite extensive bibliography. With the assistance of Patricia Denton, then a graduate student in sociology at the University of Chicago, a list of more than 800 items was compiled. Blau and I embraced an inclusive conception of the field, blanketing in contributions from all of the preceding streams of research already described. Because of the diversity of the literature covered, we developed a classification system to inform readers regarding the (1) type of study (e.g., case study, study of multiple organizations, theoretical or methodological essay); (2) type of organization (employing our cui bono typology); and (3) major topic (e.g., management, social context, publics). We concluded the listing with a “bibliography of bibliographies”—references to previous works containing extensive bibliographies.

Publication and Response The book appeared early in 1962. Reviews followed about a year later and were generally favorable. Most reviewers praised the book for its broad and integrative coverage of the sociological literature on organizations. Criticisms focused primarily on our only partially successful effort to combine presentations of results of our own, detailed investigation of the structure of social welfare agencies with a review and assessment of the broader organizational literature. Numerous reviewers commented on the imagination and intelligence of our efforts to assess and organize previous contributions. Thus, Udy (1962: 123) writes: This book is probably one of the best examples to date of peculiarly sociological analysis of formal organizations. It is perhaps best described as a “treatise.” It is not a textbook in the usual sense . . . [A] casual perusal of the table of contents reveals a fairly standard conceptualization which in itself is not especially original. Within these standard categories, however, the authors employ many highly original theoretical themes to integrate numerous diverse research findings from a wide variety of sources.

And, in his review for the American Political Science Review, Guetzkow (1962) comments: Blau and Scott make a remarkable integration of the literature of organizational behavior, in its informal as well as its formal aspects. . . . Those who desire that our

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study of politics become more rigorous will stand in admiration of the modesty and soundness with which Blau and Scott apply the scientific method. They use negative instances and contrasting findings to serve as springboards in the development of theories more closely related to empirical realities. These scholarly skills are exhibited well in their brilliant chapter on “processes of communication,” in which they mesh the findings of experimental and field work into a theory of how formal hierarchical characteristics of an organization interact with informal social support processes in the facilitation and hindrance of problem-solving and coordination outputs of organizations.

The book quickly found a place as a frequently used text in newly established courses on organizational studies and on the shelves of graduate students and instructors. The book was reprinted in Britain in 1963, with a paperback edition also appearing in 1963, and was subsequently translated into Japanese in 1967, into Hebrew in 1968, into Italian in 1968, into Portuguese in 1970, and into German in 1971. We received encouragement from our publisher to prepare a revised edition, and although some thought was given to this possibility, Blau and I were on to new projects. Our publisher, Chandler Publications, was phased out by its parent company International Textbook Company (Intext) in 1972, and after that year the book was no longer in print in the United States, although subsidiary rights passed on first to Thomas Y. Crowell and then to Harper & Row. As already noted, after completing the book Blau quickly launched an ambitious empirical investigation of organizational structure based on large samples of similar types of organizations. He reveled in carrying out comparative studies based on more than two cases! But in subsequent work, Blau moved away from organizations to even more macro topics, including, in collaboration with Otis Dudley Duncan, a major study of the American stratification system (Blau and Duncan, 1967) and thence to studies of the parameters of societal structure (Blau, 1977). (For a review and numerous essays relating to Blau’s many contributions, see Calhoun and Scott 1999; and Calhoun, Meyer, and Scott 1999.) By contrast, I spent most of my career writing, teaching, and conducting research on organizations—in particular, professional organizations. Following the book with Blau, I worked with a number of colleagues to examine authority systems in organizations (Dornbusch and Scott 1975) and with other colleagues to study factors affecting organizational performance (Flood and Scott 1987). The focus of most of my work in recent years has been examining the institutional sources of organizational structure (Scott 2001).

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References Aldrich, Howard. 1979. Organizations and Environments. Englewood Cliffs, NJ: Prentice-Hall. Barnard, Chester I. 1938. The Functions of the Executive. Cambridge, MA: Harvard University Press. Bavelas, Alex. 1951. “Communication Patterns in Task-Oriented Groups.” In The Policy Sciences, 193–202, Daniel Lerner and Harold D. Lasswell, ed. Stanford, CA: Stanford University Press. Blau, Peter M. 1955. The Dynamics of Bureaucracy. Chicago: University of Chicago Press. ———. 1957. “Formal Organizations: Dimensions of Analysis,” American Journal of Sociology, 63:58–69. ———. 1960. “Structural Effects,” American Sociological Review, 25:178–93. ———. 1964. Exchange and Power in Social Life. New York: John Wiley. ———. 1973. The Organization of Academic Work. New York: Wiley. ———. 1977. Inequality and Heterogeneity: A Primitive Theory of Social Structure. New York: Free Press. ———. 1995. “A Circuitous Path to Macrostructural Theory,” Annual Review of Sociology, 21:1–19. ———, and Otis Dudley Duncan. 1967. The American Occupational Structure. New York: Wiley. ———, Wolf V. Heydebrand, and Robert E. Stauffer. 1966. “The Structure of Small Bureaucracies,” American Sociological Review 31:179–91. ———, and Richard A Schoenherr. 1971. New York: Basic Books. ———, and W. Richard Scott. 1962. Formal Organizations: A Comparative Perspective. San Francisco: Chandler. Calhoun, Craig, Marshall W. Meyer, and W. Richard Scott, ed. 1990. Structures of Power and Constraint: Papers in Honor of Peter M. Blau. New York: Cambridge University Press. ———, and W. Richard Scott. 1990. “Introduction: Peter Blau’s Sociological Structuralism.” In Structures of Power and Constraint: Papers in Honor of Peter M. Blau, 1–36, Craig Calhoun, Marshall W. Meyer, and W. Richard Scott, ed. New York: Cambridge University Press. Clemmer, Donald. 1940. The Prison Community. Boston: Christopher. Dalton, Melville. 1959. Men Who Manage. New York: John Wiley. Dornbusch, Sanford M., and W. Richard Scott. 1975. Evaluation and the Exercise of Authority. San Francisco: Jossey-Bass. Drucker, Peter F. 1946. The Concept of the Corporation. New York: John Day. Duncan, Otis Dudley, W. Richard Scott, Stanley Lieberson, Beverly Duncan, and Hal H. Winsborough. 1960. Metropolis and Region. Baltimore, MD: John Hopkins Press. Durkheim, Emile 1949/1893. The Division of Labor. Glencoe, IL: Free Press. Evan, William M. 1966. “The Organization Set: Toward a Theory of Interorganizational Relations.” In Approaches to Organizational Design, 173–88, James D. Thompson, ed. Pittsburgh: Pittsburgh University Press.

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Etzioni, Amitai. 1961a. A Comparative Analysis of Complex Organizations. Glencoe, IL: Free Press. ———, ed. 1961b. Complex Organizations: A Sociological Reader. New York: Holt, Rinehart and Winston. Fayol, Henri 1949/1919. General and Industrial Management. London: Pitman. Flood, Ann Barry, and W. Richard Scott. 1987. Hospital Structure and Performance. Baltimore: Johns Hopkins University Press. Footnotes 2002. “Colleagues Remember Peter Blau,” (April), 4–6. Gosnell, Harold F. 1937. Machine Politics: Chicago Model. Chicago: University of Chicago Press. Gouldner, Alvin W. 1954. Patterns of Industrial Bureaucracy. Glencoe, IL: Free Press. Guetzkow, Harold, 1962. Review of Formal Organizations: A Comparative Approach, American Political Science Review. Gulick, Luther, and L. Urwick, ed. 1937. Papers on the Science of Administration. New York: Institute of Public Administration, Columbia University. Hannan, Michael T., and John Freeman. 1977. “The Population Ecology of Organizations,” American Journal of Sociology, 82:929–64. Harrison, Jeffrey S., and R. Edward Freeman. 1999. “Stakeholders, Social Responsibility, and Performance: Empirical Evidence and Theoretical Perspectives,” Academy of Management Journal, 42: 479–85. Hinings, C. R., and Royston Greenwood. 2002. Disconnect and Consequences in Organization Theory,” Administrative Science Quarterly, 47:411–21. Kelleberg, Arne L., David Knoke, Peter V. Marsden, and Joe L. Spaeth. 1996. Organizations in America: Analyzing their Structures and Human Resource Practices. Thousand Oaks, CA: Sage. Kelley, Harold H. 1951. “Communications in Experimentally Created Hierarchies,” Human Relations, 4:39–56. Lincoln, James R., and Arne L. Kalleberg. 1990. Culture, Control and Commitment: A Study of Work Organization and Work Attitudes in the United States and Japan. New York: Cambridge University Press. Lipset, Seymour Martin, Martin Trow and James S. Colemen. 1956. Union Democracy. Glencoe, IL: Free Press. March, James G. 1965. “Introduction.” In Handbook of Organizations, ix–xvi, James G. March, ed. Chicago: Rand McNally. ———, and Herbert A. Simon. 1958. Organizations. New York: John Wiley. Marx, Karl 1976/1847. The Poverty of Philosophy, in Collected Works, Karl Marx and Frederick Engels. New York: International Publishers. Mayo, Elton. 1945. The Social Problems of an Industrial Civilization. Boston: Graduate School of Business Administration, Harvard University. Merton, Robert K. 1940. “Bureaucratic Structure and Personality,” Social Forces, 18:560–68. ———. 1949. Social Theory and Social Structure. Glencoe, IL: Free Press. ———. 1990. “Epistolary Notes on the Making of a Sociological Dissertation Classic: The Dynamics of Bureaucracy. In Structures of Power and Constraint: Papers in Honor of Peter M. Blau, 37–66, Craig Calhoun, Marshall M. Meyer, and W. Richard Scott, ed. New York: Cambridge University Press.

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———, Alisa Gray, Barbara Hockey, and Hanan C. Selvin, ed. 1952. Reader in Bureaucracy. Glencoe, IL: Free Press. ———, and Paul F. Lazarsfeld, ed. 1950. Continuities in Social Research: Studies in the Scope and Method of “The American Soldier.” Glencoe, IL: Free Press. Miller, Delbert C., and William H. Form. 1951. Industrial Sociology: An Introduction to the Sociology of Work Relations. New York: Harper. Moore, Wilbert E. 1946. Industrial Relations and the Social Order. New York: Macmillan. Parsons, Talcott. 1960. Structure and Process in Modern Societies. Glencoe, IL: Free Press. Pugh, D. S., D. J. Hickson, and C. R. Hinings. 1969. “An Empirical Taxonomy of Structures of Work Organizations,” Administrative Science Quarterly, 14:115–26. ———, D. J. Hickson, C. R. Hinings, and C. Turner. 1968. “Dimensions of Organizational Structure,” Administrative Science Quarterly, 13:65–91. Roethlisberger, Fritz J., and William J. Dickson. 1939. Management and the Worker. Cambridge, MA: Harvard University Press. Roy, Donald. 1952. “Quota Restriction and Goldbricking in a Machine Shop,” American Journal of Sociology, 57:427– 42. Scott, W. Richard. 1955. “A Study of the Socialization Process of Student Nurses in a Small, Denominational Urban Hospital.” Unpublished M.A. thesis, Department of Sociology, University of Kansas, 1955. ———. 1961. “A Case Study of Professional Workers in a Bureaucratic Setting.” Unpublished Ph.D. thesis, Department of Sociology, University of Chicago. ———. 1981. Organizations: Rational, Natural and Open Systems, 1st ed. Englewood Cliffs, NJ: Prentice-Hall. ———. 2001. Institutions and Organizations, 2nd ed. Thousand Oaks, CA: Sage. ———. 2003. Organizations: Rational, Natural and Open Systems, 5th ed. Upper Saddle, NJ: Prentice-Hall. Selznick, Philip. 1943. “An Approach to a Theory of Bureaucracy,” American Sociological Review, 8:47–54. ———. 1948. “Foundations of the Theory of Organization,” American Sociological Review, 13:25–35. ———. 1949. TVA and the Grass Roots. Berkeley, CA: University of California Press. ———. 1952. The Organizational Weapon: A Study of Bolshevik Strategy and Tactics. New York: McGraw-Hill. Shenhav, Yehouda. 1999. Manufacturing Rationality: The Engineering Foundations of the Managerial Revolution. Oxford: Oxford University Press. Simon, Herbert A. 1945. Administrative Behavior: A Study of Decision Making Processes in Administrative Organizations. New York: Mcmillan. Stanton, Alfred H., and Morris S. Schwartz. The Mental Hospital. New York: Basic Books. Taylor, Frederick W. 1947. Scientific Management. New York: Harper & Brothers. Tilly, Chris, and Charles Tilly. 1998. Work Under Capitalism. Boulder, CO: Westview Press. Udy, Stanley H., Jr. 1959a. “The Structure of Authority in Non-Industrial Production Organizations,” American Journal of Sociology, 64:582–84.

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———, Jr. 1959a. “Bureaucracy” and “Rationality” in Weber’s Theory,” American Sociological Review, 24:791–95. ———, Jr. 1962. Review of Formal Organizations: A Comparative Approach, Administrative Science Quarterly, 7:123–25. Ward. John William. 1964. “The Ideal of Individualism and the Reality of Organization.” In The Business Establishment, 37–76, Earl F. Cheit, ed. New York: John Wiley. Weber, Max. 1946/1906–1924. From Max Weber: Essays in Sociology, Hans H. Gerth and C. Wright Mills, ed. New York: Oxford University Press. ———. 1947/1924. The Theory of Social and Economic Organization, A. H. Henderson and Talcott Parsons, ed. Glencoe, IL: Free Press.

Preface

Modern man is man in organizations. If the most dramatic fact that sets our age apart from earlier ones is that we live today under the shadow of nuclear destruction, the most pervasive feature that distinguishes contemporary life is that it is dominated by large, complex, and formal organizations. Our ability to organize thousands and even millions of men in order to accomplish large-scale tasks—be they economic, political, or military—is one of our greatest strengths. The possibility that free men become mere cogs in the bureaucratic machineries we set up for this purpose is one of the greatest threats to our liberty. This book presents a sociological analysis of some of the main facets of organizational life. We shall examine the nature and types of formal organizations, the connections between them and the larger social context of which they are a part, and various aspects of their internal structure, such as peer group and hierarchical relations in organizations, processes of communication, management and impersonal mechanisms of control. The investigation of the various topics will involve the discussion of many studies of organizations and numerous related studies from the literature. Our aim, however, has not been to cover the entire relevant literature. No single work could achieve such complete coverage, since there exist literally thousands of books and articles on organizations. (The extensive bibliography at the end of this book contains only about one-third of the sources we have collected, with the help of Patricia Denton, and our own compilation is undoubtedly far from exhaustive.) Our intent, rather, has been to select those empirical studies and general discussions that help to clarify a particular problem under review. Frequently we have drawn on our own research on organizations, not only because we are most familiar with this material, but also to provide some continuity in the empirical examples. We are indebted to Ivan C. Belkamp, Leonard Bloom, and Otis Dudley Duncan for many helpful criticisms and suggestions. We gratefully acknowl-

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edge financial support from the Ford Foundation and the Social Science Research Committee of the University of Chicago (to Blau) and a fellowship from the Social Science Research Council (to Scott). The typing services of Nancy Levinson Scott and Jayne Salzman Heron are appreciated, as is Joan Stelling’s assistance with the indexes. Finally, we owe thanks for support and encouragement to Zena Smith Blau and Joy Whitney Scott. Peter M. Blau W. Richard Scott 1962

Formal Organizations