In this section of my book the author discussed the way bureaucracy has been applied to business in the past and how this has changed throughout the past several decades. He first explains that around the period of the first and second world war many business executives treated their businesses in the same fashion as the military is set up. This was evident through the use of a top down approach of management. The development of large corporations led to an emergence of systems of hierarchies to manage and maintain these corporations. This business model has proven very effective and has remained as a means of management even today. The main focus of this chapter was bureaucracy but it delved into problems that have emerged between layers within business bureaucracies as well as explanations for the emergence of these problems. One problem that the author touched on is related to the dot com boom of the nineties. During this time there was a massive influx of investors looking to get rich quick with the emergence of so many companies becoming instantaneously highly valued. As a result of this scenario many investors expected instant returns on their investments. Many were disappointed when this did not happen and as a result there were many disheartened investors. Although there were many other factors having an influence on the burst of the dot com bubble this was one factor that played into it and was an influential factor in the decline of the economy at this point in time. An emerging issue that the author touched on is the loss of jobs due to automation and the increased use of machines and robots to do certain jobs. This phenomenon has led to many people struggling to find work due to their job being replaced by machines. The types of jobs that are being replaced are manual jobs that require little to no education. This has created a push for those caught in this situation to obtain additional education so they can compete for jobs in the job market. A similar issue that goes along with this is the fact that at an increasing rate businesses are utilizing temp workers rather than employing full time workers. This is a problem because it does not allow for people to gain steady employment and have a job they can rely on in the long term. The reason for business using more temps is due to concerns for efficiency. Since businesses are constantly starting and completing projects it is more efficient to hire temps as needed rather than having to constantly hire and fire full time employees. Another source of problems within the bureaucracies of business is that people involved in major business decisions that are not actually part of the company do not have to deal with the consequences of these decisions. The author gave a discussion on the use of consultants to highlight this point. Consultants are outside personnel hired by the company to assist with things such as reorganizing the company, the task given to the consultants used in the author’s discussion. There are inherent problems with using people from outside the company to do tasks such as this. First, they are probably not as educated and knowledgeable about the company and the inner workings of the company as the actual employees that work there. Not only is this a problem but these consultants do not have to deal with the possible negative side effects of their decision making. Once they have done their work they are paid and leave. The employees are stuck dealing with any negative outcomes brought on by their “professional opinion.” One can see the frustration this would cause an employee to have when dealing with this issue. A somewhat similar issue causing tension between employees and management is the fact that in a majority of instances employees will take direction from their superiors even when the employees see their boss as incompetent. This was another mirrored aspect of businesses to the military. Even though employees may feel as if their boss is not a good leader or decision maker many employees take orders accordingly and do things such as talk about their boss behind their back rather than confront the issue of their incompetence. As well as touching on these interpersonal conflicts within business the author also identified what he called the three social deficits of structural change. These are issues brought on by the ever changing world of business and its evolution. The first of these problems is that employees have low levels of loyalty to their employers. This is brought on by the fact that in times of economic prosperity businesses for the most part will reap almost all of the economic value brought on by this prosperity, while sharing little if any of the benefit with employees. However, during harder economic times businesses will expect employees to hunker down and take part of the hit. From the standpoint of an employee this is not a very fair situation. The second issue is that there is diminishing informal trust between workers. By informal trust it is meant employees being able to rely on one another for things outside normal job functions. An example of this given by the author is that in a factory when a fire broke out all employees were able to handle the situation flawlessly without any formal set of procedures for this type of incident, these people demonstrated strong informal trust. In an office building with the breakout of a similar incident it resulted in chaos, this obliviously showed there was little informal trust with these employees. The third issue is that there is a weakening of institutional knowledge. People in many professions are losing much of the accumulated knowledge gained by processes such as long term employment and experience. Although all of these issues are loosely related to bureaucracies within business and problems experienced by them, there is the common trend of conflict. This conflict tends to be between one level of authority in a business and another. Conflict within a business is detrimental because it can lead to inefficiency due to having to deal with the conflict and loss of employees if it is serious enough that they need to be let go or they are so distraught that they leave the firm. The fact that there are so many problems that arise within businesses that are a source of conflict between one group and another makes it apparent why we have been focusing on conflict resolution and negotiation so much. Many of the issues that were discussed in this section of the book could be resolved with the use of negotiation. Considering many of the problems dealt between employees and their managers this resembled the case we looked at in class regarding the mine worker. In situations such as these it is important to use negotiation that will get to the bottom of what each parties interests are so that there is a mutual understanding between the parties and each can walk away feeling satisfied (ideally).
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