Bureaucracy in an Age of Fluidity

The Innovative Bureaucracy

Bureaucracy has been largely criticized throughout much organization theory and management literature, having been seen as inefficient and incapable of being able to respond to external changes. Contrariwise, Alexander Styhre argues that an empirical study of bureaucracy underlines the merits of a functional organization, the presence of specialist and expertise groups and hier- archical structures. Styhre examines the literature of bureaucracy and the new forms of post- bureaucratic organization and shows that the discourse on bureaucracy includes a number of competing and complementing themes. His two empirical studies, of the Volvo Car Corporation and AstraZeneca, offer affirmative views of bureaucracy and a final chapter, drawing on the bio-philosophy of Henri Bergson, presents a vitalist model of bureaucracy, capable of both apprehending its functional organization and its continuous and ongoing modifications and changes to adapt to external conditions. This book will be of great use to advanced students of organization and management theory, seeking alternative views and perspectives on bureaucracy and its relative merits. It will also be of considerable interest to managerial strate- gists and decision-makers world wide.

Alexander Styhre is Professor at the Department of Technology Management, Chalmers University of Technology, Gothenburg, Sweden. Routledge studies in innovation, organization and technology

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Alexander Styhre First published 2007 by Routledge 2 Park Square, Milton Park, Abingdon, Oxon OX14 4RN Simultaneously published in the USA and Canada by Routledge 270 Madison Ave, New York, NY 10016 Routledge is an imprint of the Taylor & Francis Group, an informa business This edition published in the Taylor & Francis e-Library, 2007. “To purchase your own copy of this or any of Taylor & Francis or Routledge’s collection of thousands of eBooks please go to www.eBookstore.tandf.co.uk.”

All rights reserved. No part of this book may be reprinted or reproduced or utilized in any form or by any electronic, mechanical, or other means, now known or hereafter invented, including photocopying and recording, or in any information storage or retrieval system, without permission in writing from the publishers. British Library Cataloguing in Publication Data A catalogue record for this book is available from the British Library Library of Congress Cataloging in Publication Data A catalog record for this book has been requested ISBN 0-203-96433-0 Master e-book ISBN

ISBN10: 0-415-39597-6 (hbk) ISBN10: 0-203-96433-0 (ebk)

ISBN13: 978-0-415-39597-7 (hbk) ISBN13: 978-0-203-96433-0 (ebk) For Simon and Max The strongest is never strong enough to be always the master, unless he transforms strength into right, and obedience into duty. Jean-Jacques Rousseau, The Social Contract: 184

All that we ask of the men is to do the work that is set before them. Henry Ford, cited in Thompson 1969: 29 Contents

List of illustrations viii Preface ix Acknowledgements xi

1 The supplementarity of bureaucracy in management thinking 1

2 The concept of bureaucracy 27

3 Afﬁrming the ﬂuid: debating post-bureaucratic organizations 74

4 The innovative bureaucracy, Part I: the entrepreneurial bureaucracy 108

5 The innovative bureaucracy, Part II: the science-based bureaucracy 134

6 Bureaucracy in an age of ﬂuidity: a vitalist view 167

Notes 196 Bibliography 199 Index 226 Illustrations

Figures 4.1 Market segment trends for consumer goods in Germany 116 4.2 Illustration of Volvo Cars’ new product launches, 1974–2003 120 5.1 Overview of the research process 141 5.2 The drug discovery research process 143

Tables 1.1 Schools of innovation research 14 1.2 The main feature of the three perspectives 15 2.1 Management ideologies, 1870–1992 36 2.2 Bureaucracy vs. “parallel learning structure organization” 58 Preface

It probably matters that I was born, raised and have spent most of my life in a modern Western social-democratic country praising egalitarian values, and, most importantly, spending a considerable amount of resources on the public sector – but I have never been fully able to understand all the ready-made complaints and critiques about bureaucracy in popular culture and the social theory and organization theory literature that I have engaged with over the last ten years. For me, bureaucracy is not part of the problem but part of the solution to a range of social concerns and objectives. Without doubt, my own personal experiences from reasonably well-functioning bureaucratic organizations cater- ing a range of services in Swedish municipalities and the state administration are not fully compatible with other’s experiences of bureaucracy. I have, over the years, heard numerous complaints, anecdotes and more or less amusing stories from my friends and colleagues about encounters with Belgian immigration offi- cers, Italian university administrators, the Chinese railways, the Philippinian police corps and a variety of other representatives of bureaucratic organizations that have been deemed by my interlocutors to function less smoothly and trans- parently than one may hope for. Furthermore, newspapers continuously report about the presence of corruption, bribery, nepotism and oligarchies in most parts of the world. Such news is discouraging for anyone having faith in public administration, so I am fully aware that I may have been lucky to be able to testify to my belief in bureaucracy. However, this book is the outcome of my own inability to really understand the problem with bureaucracy as such; isn’t bureaucracy just one type of organizational arrangement whose content rather than form determines its outcome and effects? What struck me is that it is, in fact, the very form as such that seems to enrage both the proverbial “wo/man on the street” and the more theoretically inclined social scientist. Contemporary everyday speech is infested with a rich variety of derogatory remarks on bureaucracy and stories of how it fails to function or fails to provide meaningful work assignments abound. This veritable mythology of the shortcomings of bureaucracy is shared between folk psychol- ogy, popular culture and scholarly works. Moreover, what is confusing for us – perhaps not too many, one may ask? – having positive experiences of bureaucracy is that most dismissive remarks on the subject appear to be based on what x Preface is often referred to as “anecdotal evidence” by positivists; that is, idiosyncratic and contextualized experiences, or even by mere hearsay and common-sense thinking. Like in all mythologies, the deeply imbued belief that bureaucracy is a suspicious thing is a self-perpetuating axiom that one cannot easily falsify without deconstructing underlying and rarely articulated assumptions. Bureau- phobia – the systematic disbelief in bureaucracy – is here fixed in the form that Pierre Bourdieu calls doxa. In order to defamiliarize what one already knows, empirical studies may hopefully play a role. This book is therefore an attempt at critically examining the literature on bureaucracy and the various organizational arrangements that have been jointly referred to as “post-bureaucratic organization”. In addition, the book presents two studies of large Swedish companies employing a bureaucratic form to organize their activities. Finally, a more affirmative image of bureaucracy than the conventional mechanistic metaphors is sketched in the final chapter. The aim of the book is thus to make bureaucracy a domain of empirical research anew, rather than serving as a “straw man” or a signifier denoting an antiquated organization form always already dismissed as being out of step with contemporary times. The other aim is to speak of bureaucracy in terms of change, movement and adaptation rather than stability, closure and even petrifi- cation. Therefore, notions such as vitalism, organism and becoming, derived from a bio-philosophical discourse, are brought into discussion in the sixth and final chapter. As we learn from, for instance, Alfred North Whitehead and Gilles Deleuze, in order to defamiliarize what is, one needs to conceive of images of what may be; thinking emerges through concepts and therefore new images, vocabularies and metaphors may help us to think along new routes. Rather than reproducing trite mechanistic images of bureaucracy, an organic image of an organization form maintaining its form, yet responding to external changes and influences may be enacted. For me, no matter how naive such a view may be regarded, that is how bureaucracy works: through ceaseless differentiation and integration, through oscillating between openness and closure. Acknowledgements

I am indebted to Sten Setterberg, Volvo Car Corporation, Mats Sundgren, AstraZeneca, Mölndal, Jan Wickenberg, AstraZeneca, Mölndal and especially Soﬁa Börjesson, Chalmers University of Technology, for all of their support and help during the research project on which this book is based. I am also grateful for the time spent on the research project by the busy co-workers and managers at Volvo Car Corporation and AstraZeneca. I would also like to thank the participants at the ﬁrst OLKC Conference at the University of Warwick, UK, in March 2006, in commenting on my paper and helping me to reformulate some of my ideas. The study was funded by a grant from The Bank of Sweden’s Tercentenary Fund.

1 The supplementarity of bureaucracy in management thinking

Introduction In a paper published in 1970, Warren Bennis speaks about the “end of bureaucracy”: “Every age develops an organization form appropriate to its genius, and . . . the prevailing for today – the pyramidal, centralized, functionally special- ized, impersonal mechanism known as bureaucracy – [is] out of joint with contemporary realities” (Bennis, 1970: 166). Bennis continues and predicts a future where new organization forms are developed and widely used:

Organizations of the future . . . will have some unique characteristics. They will be adaptive, rapidly changing temporary systems, organized around problems-to-be-solved by groups of relative strangers with diverse professional skills. The groups will be arranged on organic rather than mechanical models: they will evolve in response to problems rather than to programmed expectations. People will be evaluated, not in a rigid vertical hierarchy according to rank and status, but flexibly, according to competence. Organization charts will consists of project groups rather than stratified functional groups, as now is the case. Adaptive, problem-solving, temporary systems of diverse specialists, linked together by coordinating executives in an organic flux – this is the original form that will gradually replace bureaucracy. (Bennis, 1970: 166)

Bennis is here sketching a future society less dependent on the bureaucratic organization model. Instead, a variety of more ﬂuid and ﬂexible organization forms, capable of responding to new challenges and new human demands and expectations, are advocated. Bennis’s text is representative of a utopian stream of thinking in the management literature, a genre of writing that thinks of forms of organization as a vehicle for the democratic society and other virtues praised in the Western world. In many cases, such utopian thinking has joined hands with a tradition of critical views of bureaucracy. Here, bureaucracy, portrayed as an embodiment of deranged instrumental rationalities and the mistaken expectations on the positive effects of economies of scale, is one of the abiding 2 The supplementarity of bureaucracy concerns for management writers. For instance, in 1966, Warren Bennis portrayed bureaucracy in the following terms:

If does not take a great critical imagination to detect the ﬂaw and problems of the bureaucratic model. We have all experienced them: bosses without technical competence and underlings with it; arbitrary and zany rules; an underworld (or informal) organization which subverts or even replaces the formal apparatus; confusion and conﬂict among roles; and cruel treatment of subordinates, based not upon rational or legal grounds, but upon inhu- mane grounds. (Bennis, 1966: 5)

Bureaucracy is, for its detractors, one of the predicaments of modern life and must be examined as what is, at best, a functional solution to administrative problems and, at worst, an immediate and living threat to the open society. In management writing, bureaucracy critiques are a staple food, a trite gesture and what is very much grist for the mill for a variety of management writers sub- scribing to various theoretical and methodological orientations. “Bureaucracy is a term so loaded with negative meaning for most people that it is mainly used as a negative rhetorical resource and it is difﬁcult to make an explicit ideological case for bureaucracy” (Thompson and Alvesson, 2005: 105). Bureaucracy has many detractors and few friends. Such anti-bureaucratic sentiments are by no means a recent cultural phenomenon. Honoré de Balzac, the great French novel- ist, published no less than ninety-ﬁve interconnected novels and short stories under the label La Comédie Humaine, capturing the French society of his time, the period 1830–1850. One of the novels is entitled Bureaucracy (Les Employés, 1837, also translated as The Bureaucrats) and accounts for the intrigues and political games in a French bureau when a new director is about to be appointed. Balzac portray the French bureaucracy in the following terms:

No one comes or stays in the government ofﬁces but idlers, incapables, or fools. Thus the mediocrity of French administration has slowly come about. Bureaucracy, made up entirely of petty minds, stands as an obstacle of pros- perity of the nation; delays for seven years, by its machinery, the project of a canal which would have stimulated the production of a province; is afraid of everything, prolongs procrastination, and perpetuates the abuses which in turn perpetuate and consolidate itself. Bureaucracy holds all things and the administration itself in leading strings; it stiﬂes men of talent who are bold enough to be independent of it or to enlighten it on its own follies. (Balzac, 2000: 10–11)

Here, bureaucracy is portrayed in comical terms and as being subject to political struggles. For instance, one of the dramatis personae frankly says: “Of course bureaucracy has its defects. I myself think it slow and insolent; it hampers ministerial action, stifles projects, and arrests progress. But, after all, French The supplementarity of bureaucracy 3 administration is amazingly useful” (Balzac, 2000: 137). Perhaps Balzac is here the spokesman of a common view of bureaucracy in mid-nineteenth-century French society. The purpose of this book is to critically review the literature on bureaucracy and to present a two-year study of how two major multinational firms are organ- izing their innovative capacities to support a more affirmative view of bureaucracy. In the contemporary management literature, in the media and in popular culture, the bureaucratic organization form is generally portrayed as an inefficient, outmoded and poorly functioning form of organization unable to provide meaningful job opportunities for its members. This overtly negative view of bureaucracy is by no means a recent idea but, rather, has been one of the consis- tent themes in both the organization theory literature and in other disciplines in the social sciences. “Nearly everyone,” Starbuck (2003a: 162) writes, “who has written about bureaucracies has complained about it; almost the only authors who found value in bureaucracy were German economists and sociologists writing between 1870 and 1915.” In many cases, bureaucracy has been invoked to serve the role as what Derrida (1976) calls a supplement, what is additional to, complementing, or external to something but nevertheless fails to achieve the same status as the primary and most accomplished form. The terms “supplement” and “supplementarity” are here adopted from Jacques Derrida’s seminal account on the role of writing in Western thinking as being a mere supplement to speech. For Derrida, the Western canon rests on what he, drawing on Heidegger, calls “logocentrism”. Logocentrism is the “metaphysics of presence”, an ontological and epis- temological position favouring presence in every single instant, that things are not in the making but contain their innate essences exclusively enclosed within themselves. For Derrida, logocentric thinking is observable in the literature on writing in Western thinking, especially in Plato but also in less central figures in the philosophy of metaphysics such as Jean-Jacques Rousseau. Rousseau declares: “Languages are made to be spoken, writing serves only as a supplement to speech” (quoted in Derrida, 1976: 303). Writing is a corrupted form of speech, a form of speech fixed by certain symbols and always less closely asso- ciated with the human mind. For Plato, the written text can never substitute for the full presence of oral speech. Socrates, Plato’s beloved master – “he who does not write”, for Nietzsche – resisted writing for this reason. Rousseau, then, is following closely in this tradition. Writing as supplement; writing as mere image or representation of primary speech; “[W]riting, the letter, the sensible inscription, has always been considered by the Western tradition as the body and matter external to the spirit, to breath, to speech, and to the logos” (Derrida, 1976: 35). Derrida argues that Rousseau’s disregard of writing is derived from this binary mode of thinking, the Platonist separation into dualities, opposing terms structuring being into a series of antagonist relations:

[R]ousseau could not think this writing, that takes place before and within speech. To the extent that he belonged to the metaphysics of presence, he 4 The supplementarity of bureaucracy dreamed of the simple exteriority of death to life, evil to good, representation to presence, signiﬁer to signiﬁed, representer to represented, mask to face, writing to speech. But all such oppositions are irreducibly rooted in that metaphysics. (Derrida, 1976: 315)

What we may learn from Derrida is that all thinking is located within a certain tradition of thinking. The treatment of writing as something that is only sec- ondary, additional, supplementary, and in many respects inferior to speech, is one indication of the effects of the logocentric thinking proceeding along binary categories. Writing is, then, Derrida argues, never supposed to be strictly complementary to speech or the equal to speech but is, instead, what is merely supplementary, always less credible and useful. As Gherardi (1995) points out, Platonist thinking is problematic because such binary opposites are never supposed to be of equal importance: the supplementary concept is always less valued, of less importance or directly condemned. Reality–appearance, good–bad, original–copy, speech–writing, man–woman, is a series of Platonist and opposing concepts. It is always the former that is privileged and given a central importance. As feminist thinkers point out, women are deﬁned in terms of negativity, in terms of the absence of masculine qualities and features – de Beauvoir’s (1993) le deuxième sexe – and so is the case for all such binar