THE RATIONAL MODEL OF ORGANIZATION (pages 81-91)

Presented as a report by J. B. Nangpuhan II (MPA Student) for the class (Organization and Society) of Dr. H. G. Kim at Chonnam National University, Korea on Nov. 3, 2010.

 

SUMMARY[1] 

 

I.        (A SCIENCE OF HUMAN BEHAVIOR)

II.      (THE GENERIC APPROACH TO ADMINISTRATION)

III.    (THE PROVERBS OF ADMINISTRATION)

IV.    (THE RATIONAL MODEL OF ADMINISTRATION)

 

V.      DECISION MAKING AND POLICY FORMULATION

These particular topics illustrate further the impact of the rational model to decision making and policy formulation and see how these have been treated by later writers.

The work of Simon through Administrative Behavior (1957a) is considered the study of decision making in organizations. He argued that decision making is the core of administration. Decision making is essentially the same as management itself. This is a new focus in contrast from the past view on decision making wherein it is concentrated at the highest organizational levels. This renewed decision making process involves from the decision of the chief executive to undertake a new program to the decision of the operative employee to carry out a given order. This process consists of three basic elements in decision making: a. Intelligence – involves scanning the environment and identifies occasions to make a decision; b. Design – involves finding or developing alternative courses of action; and c. Choice – involves selecting the alternative with the best chance of success.

A.      Administrative Man versus Economic Man

The classical economic man assumes that the decision maker is completely informed to both the goals of the organization and the possible available alternatives and that he acts to maximize something such as gains, profits, utilities, satisfactions and so on.

In contrast to economic man, administrative man seeks to “satisfice” by finding satisfactory solutions rather than to maximize. He can make his choices without first examining all possible behavior alternatives and without ascertaining that these are in fact all the alternatives. Administrative man is content with a simplified and incomplete view of the world that can never approximate the complexity of the real world because of human limitations. He treats the world as rather “empty,” and ignores the “interrelatedness of all things.” He is able to make his decisions with simple rules of thumb that do not make impossible demands upon his capacity for thought.

Although administrative man is capable of only “bounded rationality,” he also must seek rational (efficient) organizational actions. The basic calculus remains the same for administrative man as for economic man: to whatever extent possible, utilities are to be maximized. In order to diminish the negative effects of human irrationality, the organization will impose its own standards of rationality on the individual.

B.      Lindblom’s Incremental Method

Simon’s important discussion of decision making had at least two effects: a.) it moved the focus of decision-making studies from the policy level to the operational level; and b.) it highlighted the tension between rational behavior and real behavior in human systems. The second point was the focus of the article of Charles E. Lindblom (1959) entitled “The Science of Muddling Through.” He outlined two approaches to policy making (or decision making): rational-comprehensive method and “successive limited comparisons” or incremental method.

In the rational method, the policy maker prioritizes all relevant values and chooses an objective. Then develops a list of alternative policies and examine this in light of their ability to achieve the desired goal. After that, selects the alternative that maximizes the value chosen.

The incremental method is more useful in practice and has definite advantages for policy formulation in a democratic society. In this method, the policy maker settles on a limited objective to be achieved by the policy then outline the few options that were immediately available. And then makes a choice that combined into one “the choice among values and the choice among instruments for reaching values.” The comparisons depend on the administrator’s past experience and would likely achieve only partial solutions. In this case, the policy maker is expected to repeat this incremental process repeatedly in response to changing circumstances.

C.      Aspects of the Incremental Method (Lindblom, 1959)

v  Contrary to the rational method, it is never possible in real life to sort out and rank all the values or objectives related to a particular problem. Values or objectives must be stated in marginal terms with respect to particular policies.

v  Consistent with the pluralist model of democracy, the most effective public policies are those that are already in effect and are agreed to by a wide range of competing parties. The decision maker can simplify the process of choice to manageable proportions.

v  “Almost every interest has its watchdog” where the interaction of various competing groups will eventually lead to policies that are responsible to a wide range of interests. “For the method of successive limited comparisons, the test is agreement on policy itself, which remains possible even when agreement on values is not.”

v  To safeguard against error, the administrator (and the society) follows the following incremental steps:

o   Past sequences of policy steps have given him knowledge about the probable consequences of further similar steps;

o   He need not attempt big jumps toward his goals because he never expects his policy to be a final resolution of a problem. His decision is only one step;

o   He is able to test his previous predictions as he moves on to each further step;

o   He often can remedy a past error fairly quickly – more quickly than if policy proceeded through more distinct steps widely spaced in time.

D.      Three Models of Decision Making

Graham T. Allison’s book entitled Essence of Decision (1971) outlined three models of decision making:

v  Classic or Rational actor model

According to Allison, this model is similar to those used by Simon and by Lindblom which involves a process of setting objectives, designing alternatives, examining consequences, and choosing the alternative that maximizes the objectives. Rationality refers to consistent and value-maximizing choice within specified constraints. Allison treats this process as the standard model of decision making. The policy maker’s behavior here is intentional and goal-seeking focusing on means rather than ends in the decision-making process. This model is prevalent in the analysis of foreign-policy decisions.

v  Organizational process model

This model is based on the premise that few major government decisions are exclusively the province of a single organization. But the decisions made at the highest levels of government are based on information and advice from several agencies. The organization attempts to reduce uncertainty in its environment and to seek out those alternatives that are immediate, available, and related to the problem at hand. Hence, the stability of the organization does change to meet environmental demands.

v  Government politics model

In this model, policy is the outcome of a process of bargaining among individuals and groups with diverse interests and varying degrees of power to support those interests. When disagreements occur, a political game (using the power and skill or proponents and opponents of the action in question) leads either to a victory for one party of a mixed result from what any party intended.

VI.    CLOSED SYSTEMS VERSUS OPEN SYSTEMS

The works of Lindblom and Allison represent two important points: less emphasis on rational choice, and greater attention is paid to environmental factors. Here, the organization is no longer seen as an isolated unit but as one that is subject to important influences from its environment. This is contrary to rational choice or the ‘bounded rationality’ by Simon.

A.      Strategies for Studying Complex Organizations

James D. Thompson, in his Organization in Action (1967) formally treated the above differences in perspective through the closed-system and open-system strategies for studying complex organizations.

v  Closed-system strategy – is concerned with efficiency in the accomplishment of objectives. This can be done by employing the resources of the organization in a functional manner with each component contributing to the “logic” of the system and with control mechanisms designed to reduce uncertainty.

v  Open-system strategy – it suggests to expect surprise or uncertainty. The complex organization is a set of interdependent parts and each contributes something and receives something from the whole which in turn is interdependent with some larger environment. Although changes occur because of evolutionary process of development, the overall tendency of the system is toward homeostasis, or balance.

B.      An Open-System Approach to Organizational Analysis

In the field of public administration, two major case studies emphasizing relationships between the organization and its environment in contrast to closed-system thinking have been produced.

(1) The first case study was undertaken by Philip Selznick entitled TVA and the Grass Roots (1949). TVA stands for Tennessee Valley Authority. In this study, Selznick was more concerned with the grassroots policy of the agency, a policy of decentralization and the involvement of already existing local and state agencies as an approach to democratic planning.  The members of the organization resist being treated as means; rather, they participate as whole personalities, each having a particular and unique set of experiences and desires. The organization exists within an institutional framework that makes certain demands on it hence; organizations cannot escape the impact of these “nonrational” factors. The need for organizational security as a whole in relation to social forces may be met at least in part by developing stable relationships with various actors in the environment. Even relationships that may seem to compromise somewhat the organization’s ability to determine its own directions should also be developed.

C.      The Process of Cooptation

Cooptation is defined as the process of absorbing new elements into the leadership or policy-determining structure of an organization as a means of averting threats to its stability or existence. This is a technique for securing the consent and commitment of potentially threatening groups in the environment. By doing so, the creative leader compromises deals with the institutional character of the group but he is very careful to guard against organizational surrender. This process is transition from administrative management to institutional leadership.

D.      The Impact of Environmental Factors

(2) The second case study was the study of Herbert Kaufman entitled The Forest Ranger (1960) again indicated the importance of environmental factors. Given the large distance between broad policy statements made by those at the top of the organization and the actions taken by those at the bottom, the potential always exists for substantial discrepancies between the policy announced and the actions taken. At the level of the institution, the organization must continually cope with a high degree of uncertainty.

Kaufman found out in his study that the rangers are being influenced by ‘customs and standards of the communities in which they reside and the preferences and prejudices they bring with them from their extra-organizational experiences and associations may lead them in a variety of directions.’ Therefore, to prevent a ranger from being unduly influenced by the members of the local community, field officers were encouraged to develop a high degree of identification with the service prior to assuming a position in a community. Also, personnel were frequently transferred from one location to another.

E.       Integrating Open- and Closed-System Approaches

Decision making might be viewed differently at different locations in the organization. This idea is being supported by James Thompson who attempted to reconcile closed- and open-system approaches based on three organizational levels of responsibility and control. These are the following: technical, managerial, and institutional. The technical suborganization is concerned with the effective performance of the actual task of the organization. The managerial suborganization is concerned with mediating between the technical group and the clients of the organization and with providing the resources necessary to accomplish the technical task. The institutional suborganization is concerned with the relationship between the organization as an institution and the wider social system of which it is a part.

The above organizational levels would lay down the integration of closed-system and open-system approaches. Thompson argues that since the closed-system logic of the rational model seeks to eliminate uncertainty, it would be good for organizations to apply such logic to the operation of the technical core for greater technical rationality (efficiency). The open-system logic can also be applied to the institutional level since the organization must continually cope with a high degree of uncertainty. In the managerial level, they are expected to mediate between technical level and institutional level by ironing out some irregularities stemming from external sources and also pressing the technical core for modifications as conditions alter. According to Thompson, reconciling the interests of closed and open systems, certainty and uncertainty, determinateness and indeterminateness, lays the groundwork for contingency theories of management.

CONCLUSION

This chapter examined the rational model of administration and some of the issues generated by the rational model. Although a number of challenges have been presented, the basic commitments of the rational model to a positivist interpretation of the “facts” of administrative behavior and the use of technical rationality (often translated as “efficiency”) as the main criteria for evaluating organizational life remain at the core of thinking about public organizations. Rational model appears to be the only logical approach to understanding organizations.

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[1] Reference: Denhardt, R. B. (2011). Theories of Public Organization (6^th Edition). Boston, MA 02210, USA: Wadsworth Cengage Learning. 71-91