Can Soccer be formalized?

In this blog post, I will attempt to highlight formalization ideas proposed by Simon, 1997  and Stinchcombe, 2001 (both pg. 38 O&O)  , and connect them with how a soccer team is organized and run.

Formalization is often viewed as an attempt to render behavior more predictable by standardizing and regulating it. According to Simon, formalization permits “stable expectations to be formed by each memeber of the group as to the behavior of the other members under specific conditions. Such stable expectations are an essential precondition to a rational consideration of the consequences of action in a social group.”

When Governments Fail…

This past Monday, Iceland’s coalition government collapsed amid public outcry of the government’s failure to effectively bail out their broken financial system.  Simply put, Iceland did not have deep enough pockets like the US did to provide some sort of recovery program for its banks and other financial institutions.  Although those are some of the more specific reasons as to why this organization failed, upon coming across this story, I was curious to see if I could draw parallels to some of the things we’ve discussed in class…hopefully it’s successful.

Now, I find it very unsettling that while a government fails, organizations (more specifically, corporations), prosper.  This is even more concerning in the case of Iceland, which to date, had the oldest functioning legislature in the world, founded in 930 AD.  So why are large corporations, such as Walmart, seemingly easier to run and maintain than small (democratic) governments? While I acknowledge that these two types of organizations are very different from each other, on the highest level, they share characteristics of functioning rational organizations such as formality and goal specificity.

Right, wrong, or indifferent, maybe there is something that Iceland’s government, (which I’m sure considered itself to be a rational organization with high levels of formality and goal specificity) could learn from the way in which Walmart operates as a rational organization.  I’ll preface this with the fact that I have very little knowledge about Iceland’s former coalition government to begin with, so bear with me.

We learn from Ehrenreich’s Nickel and Dimed that the school of thought that most closely aligns with Walmart’s organizational characteristics is (arguably) that of Taylor’s scientific management.  Although Nickel and Dimed points out that Walmart’s implementation of this system is not without its flaws, it is necessary to point out that during the course of its existence, Walmart has learned how to effectively manage 2,100,000 employees.  To place that number into perspective, the population of Iceland is 304,367…Walmart employs almost SEVEN TIMES the total amount of people who live in Iceland.  Although running an organization successfully under a rational organization system goes far beyond sheer size of the workforce or population, this is an interesting fact to point out.  Maybe, just maybe, Iceland’s new government should try to implement aspects of Taylor’s scientific management, such as closer re-evaluation of the effectiveness of certain institutions and their fiscal feasibility.  Maybe this is just naïveté on my part to think that a government as an organization can implement principles that Taylor intended for industrial improvement, but hey, because their former government failed, maybe they could consider alternative approaches to ensure their government does not collapse again.

Taylor-Mart

Maybe Frederick Taylor’s real last name was Walton. Or perhaps he had a distance cousin names Sam Walton. Either way, Taylor’s ideas on scientific management have truly become part of the American culture: “(Taylor) helped instill in us the fierce, unholy obsession with time, order, productivity, and efficiency that marks our age.” As Barbara Ehrenreich shows in Nickel and Dimed, the old American adage that hard work and sweat will lead anyone to success is, by Taylor’s reasoning, false. Sadly it is not how hard you work. It is rather, Taylor believes, how well you work in the time you have, in the system you are in, with the tools available, and with consideration to those around you and the function(s) they are performing.

Taylor’s practice of absolute efficiency and productiveness is perhaps better represented by Wal-Mart than by any other American retail organization. Indeed, Wal-Mart perhaps the modern day representation of scientific management in practice (at least in the retail industry). Ehrenreich, a one-time Wal-Mart employee herself, offers multiple examples of the rigid importance of time and efficiency in the organization: two 15-minute breaks (but not a minute more!) during the day; organizing shirts by specific labeling codes; assigning each employee to a specific section of the store with specific roles. She does not even mention the tight schedule Wal-Mart holds its suppliers to, or the one-cent margins they squeeze out of the same suppliers. Wal-Mart’s just-in-time (JIT) inventory management system is also a marvel considering it can enforce a 99% service level of on-time order from suppliers (http://www.inventorymanagementreview.org/2006/04/walmart_increas.html).

            In one regard, as an organization that follows a specific and rational approach to organizational management, Wal-Mart must indeed be admired. Its goal as a corporation, maximizing profits and shareholder wealth, is met in an entirely rational fashion. Whether or not the goal of max profits is rational is irrelevant. What is important is that the means of obtaining that goal are rational. Wal-Mart as an organization is incredibly formalized, as Ehrenreich illustrated by explaining the orientation process, and has very specific goals. This allows the company to invent very rational means, such as paying minimum wage and squeezing every possible cent out of suppliers, to accomplish those goals in a very formal, efficient method transferable across geographic regions.

Formalized Structures are Eventually Ineffecient

Organizations and Organizing mentions the development of a type of rational system known as a formalized structure. Organizations design formalized structures by making the rules and roles of its members clear and explicit. This makes the social structure and flow of information obvious so that the organization’s performance is easily predictable and there is an elimination of power struggles. Additionally, it makes it so that the organization is separate from the individuals. Formalized structures are types of rational systems considered to maximize an organization’s efficiency. However, it seems soooooooo obvious that these key elements supporting the formalized structure could actually lead to decreased efficiency.

Brave New World is a classic piece of fiction written by Aldous Huxley that I believe demonstrates the problems with a formalized structure. In the book, Huxley describes a “Brave New World” that is a “world of tomorrow in which capitalist civilization has been reconstituted through the most efficient scientific and psychological engineering” (Huxley, Book Synopsis). In this world, the government genetically engineers 3 types of people. There are the leaders and thinkers, the less intellectual, and the stupefied. The book debates if the standardization of people is dehumanizing— or if stability is more significant than humanity. It ultimately concludes the scariness of living in the “Brave New World” where human life does not seem worth living. The formalized structure seems like it would have the same consequences as the fictional “Brave New World.” It too places more value on job standardization and stability than on creativity and flexibility. With a person feeling their job function is standardized, will they ever feel significant within their role? I believe in the United States if people’s jobs are all subject to the formalized system the end result will be a lack of enthusiasm, quitting, and the demise of an organization.

Nickel and Dimed seems to be another piece demonstrating the problems of the formalized structure. Barbara Ehrenreich’s description of working at Wal-Mart where her job is standardized sounds highly oppressive. She says that for her manager, “the layout is about the only thing she can control, since [all else is] determined by the home office in Arkansas.” (Ehrenreich 156). The work “requires minimal human interaction, of either the collegial or the supervisor sort, largely because it is so self-defining” (Ehrenreich 157). If the workers do not do exactly as instructed, Wal-Mart makes them aware they can easily replace them. This leaves workers with jobs that have no intrinsic value; and so, they begin to ask questions like “Why do we—work here? Why do we stay?” (Ehrenreich 179). With these types of questions, I do believe there is a big storm brewing over Wal-Mart and organizations with similar formalized structures. There is a consequence to efficiency through standardization.

Formalized structures may lead to increased efficiency INITALLY. However, with the general discomfort toward formalization as discussed in Brave New World and Nickel and Dimed, I am lead to believe that formalization has long term consequences. I am also lead to question the intentions and ethics of the organizations that institute them. Wal-Mart, Nike, and others which have formalized systems, seem to put employees in some of the most terrible working conditions, and worse yet, leave them without a voice. In this way, I really do question the long-term effectiveness of the formalized structure.

Efficiently Inefficient

Is training Wal-Mart employees even efficient?

Frederick Taylor, the father of scientific management, would be perplexed to look at Wal-Mart as an organization. Taylor believed an organization could scientifically analyze the tasks of its workers to streamline processes to maximize output and minimize input. Wal-Mart strategy of low-cost goods using new technology to minimize costs, including its economies of scale and just-in-time inventory management, is the envy of the operational management world. As part of our Bucknell management education, we have studied Wal-Mart from numerous angles, but Barbara Ehrenreich colorfully paints a picture of what a low cost strategy does to an organization’s workers in her book Nickel and Dimed (accurately subtitled On Not Getting By in America). She also points out that an organization that is centered on cutting costs, wastes so much of its own time. But can the strategies of America’s largest private employer be wrong?

WalMart – Industrial Peace?

In true Borat fasion –

WalMart employees are clearly the happiness employees on the planet……NOT!!!!!!!!!!!!!!!!!!!!!!!!

It is more than clear through the picture painted by Barbara Ehrenreich that WalMart employees probably don’t top the charts in employee satisfaction.  They seemed miserable with their wages, mindless tasks, and especially their incompetent managers, like our friend Howard.  If you think that you were surprised at the unhappiness of the WalMart workers in “Nickel and Dimed”, imagine the shock that Frederick Taylor would have felt.

Frederick W. Taylor is the father  of scientific management.  Taylor insisted that you could scientifically analyze all tasks being done in an organization and figure out better or different ways to accomplish those tasks in an effort to realize maximum efficiency.  You could also analyse the skills and talents of an organization’s employees and assign them each to specific tasks according to those talents – again in an effort to maximize efficiency.  Once workeres were all working at maximum efficiency, an era of industrial peace would come over the organization as workers working at maximum efficiency and producing maximum profits would ‘surely’ be paid top wages by their employers.  Now, while WalMart may not be the ‘perfect’ example of this theory, as they surely don’t scientifically analyze their employees talents and assign them to jobs according, but they have certainly simplified job functions enough to allow employees to specialize at a very specific job, that they would then be able to complete extremely efficiently.

Yet, something seems to have gone seriously wrong.  It’s true that the more Barbara worked the more efficiently and quickly she could put away clothes, but as time went on she seemed to become more and more dissatisfied with her job.  Much of Barbara’s, and her fellow employee’s, dissastisfaction seemed to have come from extremely low wages they were getting paid.  If you buy into Taylor’s theory, then the WalMart employees who are certainly working efficiently on their mindless tasks should be making a hefty sum of money in reward for their expertise.  That is absolutely not the case.

Just to put things in perspective…..For the sake of this example let’s say you are a single mother with one child working 40 hours/week at WalMart making minimum wage ($7.25 in PA as of July 2009).  According to the living wage calculator (Living Wage Calculator) in Union County, Pennsylvania (the country Lewisburg is in if you didn’t know) a living wage for one adult and one child is $13.87 – significantly higher than minimum wage.

Now, it’s clear that Taylor’s theory sure isn’t holding true – but why?  My answer – good business sense.  If WalMart can be one of the most profitable and largest corporations in the United States without paying their employees a living wage AND maintaining the amount of employees they need to operate, why on Earth would they pay them any more?  True these workers are working at maximum efficiency and helping to bring in profits for mother WalMart, but WalMart really has n0 incentive to raise salaries.  What can be done about this? You tell me…..