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Organizational Linkages: Understanding the Productivity Paradox 4 What is Enough? A Systems Perspective on Individual-Organizational Performance Linkages Benjamin Schneider and Katherine J. Klein Changing a single aspect of an organization almost never results in a substantial change in organizational performance. Organizations are too complex, their performance too multidetermined, and their inertia too great for a single intervention at the individual level to have a substantial impact on organizational performance. Thus, when it comes to improving organizational productivity, it is not enough simply to put in a new personnel selection system, a job enrichment program, a new computer-aided design system, or new office automation equipment. First, the new system, regardless of what it is, may not be successfully implemented. Second, the new system is unlikely to be used by employees as it was designed to be used. Third, even if it is successfully implemented and even if employees use it as designed, the new system may be insufficient by itself to change individual productivity. Fourth, even if the system has a substantial impact on individual productivity, a change in individual productivity, even in the productivity of many individuals, it may not engender change in organizational productivity. For the latter to improve, the activities and productivity of numerous organizational subsystems must also change. In sum, to change organizational productivity, it is not enough to change one aspect of the organization at one level of performance. THE NATURE OF ORGANIZATIONAL PERFORMANCE As noted in earlier chapters, the organizational psychology and organizational behavior literatures often refer to individual, group, and
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Organizational Linkages: Understanding the Productivity Paradox organizational performance as if they were somehow separable. In the real world of organizations, however, performance cannot meaningfully be disaggregated. For example, individual performance is clearly not only a function of individual attributes but also of group norms (Roethlisberger and Dickson, 1939) and organizational climate (Pelz and Andrews, 1966). There is evidence, for example, that one can predict the absenteeism of an individual based on that individual's previous absenteeism and his or her job satisfaction and then improve on that prediction by knowing the absenteeism ''norm" of the individual's work group (Mathieu and Kohler, 1990). Similarly, group performance is a function not only of the nature of the group and its task but also of the diversity of the individuals in the group (Bass, 1982), especially the leader (George, 1991), as well as the nature of the larger organizational environment in which the group functions (Lawrence and Lorsch, 1969). Finally, organizational performance is a function not only of characteristics of the organization itself, but also of the strategic decisions made by top management (an individual-level variable) and the turbulence of the larger environment in which the organization competes (Joyce and Slocum, 1990). For example, a seemingly excellent strategic decision by a typewriter manufacturer to redesign an electric typewriter was for naught in terms of organizational performance with the introduction of the personal computer by competitors in the environment. Thus, if one is to improve organizational performance, one should not target a single level or facet of an organization. Rather, as we attempt to show throughout this chapter, one must consider, evaluate, and change the multiple levels and subsystems of an organization, influencing not just individual behaviors and attitudes, not just group norms and interactions, not just organizational structures and strategies—but all of these. All of these must be simultaneously addressed because they are simultaneously linked. We hypothesize that attention to these multiple linkages augments the potential effectiveness of organizational interventions; inattention to these linkages is likely to yield little in the way of improvement in organizational performance (Schneider et al., 1992). Consider three examples. Hackman and Oldham (1980) described a series of studies in which individuals' jobs were changed to be more enriched and, therefore, more motivating, in the hope of improving individual and organizational performance. They showed that an intervention can fail to yield changes even in individual performance unless a network of larger system attributes is in place to facilitate the primary intervention. This network of attributes includes the way in which the intervention is introduced (e.g., with the participation of the workers affected or with no participation), the degree of management and supervisory support for the intervention, the extent to
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Organizational Linkages: Understanding the Productivity Paradox which the resources needed to make the intervention work are provided, and so forth. A similar effect has been documented with regard to training interventions in organizations. For example, Fleishman (1953) evaluated the effectiveness of a management training program in improving the interpersonal competencies of first-line supervisors. He found a significant effect for the training. At the end of training, those trained were more interpersonally sensitive than those not trained. A follow-up study to test for the transfer of the training to the job did not show the same differences, however. Those trained were equally unlikely as those untrained to be sensitive back on the job. Fleishman explored why this might be true and discovered that trainees were sensitive back on the job to the degree that their supervisor rewarded and supported the sensitivities learned in the training. Fleishman called this the "leadership climate" effect. One behaves the way one's leader rewards one for behaving. Rouiller and Goldstein (1993) recently reported a similar finding. Finally, research by the U.S. General Accounting Office (1987) suggests that employee ownership is unlikely to have a significant effect on organizational performance unless it is coupled with worker participation in decision making. Worker participation alone may also be insufficient to enhance organizational performance (Locke and Schweiger, 1979; Miller and Monge, 1986). But together, employee ownership and worker participation in decision making may improve organizational performance. Interventions, be they technological or human resources management in nature, are often implemented in ways that limit their effectiveness—at both the individual level at which they are initially targeted and the organizational level. Our hypothesis, which builds on the discussion of organizational linkages in Chapter 3, is that this failure to produce the intended effect is associated with a failure to conceptualize performance in organizations as a consequence of multiple levels of reciprocal linkages. In this chapter we present an organizational systems framework to clarify the multiple reciprocal linkages that can determine organizational performance. The framework emphasizes the intraorganizational linkages that must be understood and managed if interventions designed to enhance individual performance are to yield increases in organizational performance. We chose office automation as the intervention of interest, but the principles we present are applicable to a wide variety of attempts to improve individual and organizational performance. Below, after a brief introduction to office automation, we explore a number of reasons why interventions, such as office automation, can
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Organizational Linkages: Understanding the Productivity Paradox fail to yield improvements in organizational performance. We conclude by presenting summary propositions that address the conditions under which individual and organizational performance will be more closely linked. THE NATURE OF OFFICE AUTOMATION Office automation refers to the application of information technology (IT) and communication technology to the processing and use of information for tracking, monitoring, recording, directing, and supporting activity in the workplace. Office automation is designed to improve performance in offices, but as the review of the literature in Chapter 2 made clear, too often improvements in office performance have not followed the implementation of office automation. In 1985, the U.S. Congress ordered a study to determine why office automation had not yielded the improvements predicted. The report of that study, Automation of America's Offices (U.S. Office of Technology Assessment, 1985), provides a basis for our discussion. The 1985 Office of Technology Assessment review of office automation stated: "It is possible to see the latent enhancing effects of office automation as water building behind a dam. The dam is made up of institutional inertia and the unavoidable transition problem" (p. 33). Our goal in this chapter is to elucidate the nature of institutional inertia and the transition problem and to suggest ways to overcome both. As suggested above, these issues plague most, if not all, organizational interventions. Thus, the principles and hyptheses we present apply equally to all forms of interventions, not only to office automation. A SYSTEM PURCHASED IS NOT A SYSTEM IMPLEMENTED Having purchased, or designed, a new office automation system or any other system, an organization faces the challenge of implementing the system, of ensuring that it is accepted and used optimally by target employees. A growing body of literature (e.g., Klein and Ralls, in press; Tornatzky and Fleischer, 1990) indicates that implementing computerized technology is indeed a challenge. For a variety of technical and organizational reasons, employees may not use the new system at all or may use only a limited number of its features. Thus, a substantial proportion of organizations fail to implement new computerized systems successfully (Ettlie, 1986; Tornatzky and Fleischer, 1990). Employees are likely to resist or reject systems whose benefits they question. As Leonard-Barton and Krauss (1985:108) noted, "An inno-
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Organizational Linkages: Understanding the Productivity Paradox vation must offer an obvious advantage over whatever it replaces, or potential users will have little incentive to use it." But even if employees believe that a system will enhance their performance in some way, they may still resist or reject it if it is (1) difficult to learn and use (i.e., not user friendly), (2) unreliable, (3) slow to respond, or (4) awkward or difficult to access (e.g., Ettlie, 1986; Klein et al., 1990; Rivard, 1987; Rousseau, 1989). Even if the hardware and software meet the rudimentary requirements suggested above, implementation may nevertheless stall or fail altogether as a result of a variety of social and organizational factors. Indeed, the literature on the implementation of computerized systems suggests a veritable laundry list of organizational factors that may determine the success of implementation. They include (1) the quality of the computer training provided to users (e.g., Beatty and Gordon, 1988; Graham and Rosenthal, 1986; Klein et al., 1990); (2) the availability of ongoing user support (e.g., Graham and Rosenthal, 1986; Klein et al., 1990; Rivard, 1987); (3) the availability of time for users to experiment with the new system (e.g., Fleischer et al., 1988; Klein et al., 1990); (4) the extent of user involvement in decision making regarding the purchase and implementation of the new system (e.g., Foulkes and Hirsch, 1984; Leonard-Barton, 1988; Parsons et al., 1989); (5) the availability of rewards for use of the new system (e.g., Leonard-Barton and Krauss, 1985; Rousseau, 1989); (6) the extent of employee job security (e.g., Argote et al., 1983; Roitman et al., 1988); (7) the extent of coordination among employee groups affected by the new system (e.g., Abdel-Hamid and Madnick, 1989; Beatty and Gordon, 1988); and (8) the extent of political conflict within the organization regarding the new system (e.g., Markus, 1987; Pearce and Page, 1990). In sum, money invested in office automation may not yield a subsequent productivity payoff because employees do not use the system at all or do not use its most complex and potentially advantageous features. Indeed, the mere decision to adopt almost any innovation—a new management approach, a new performance appraisal system, a new quality improvement program—does not ensure that the new system or approach will, in fact, be used. Program evaluators (e.g., Posavac and Carey, 1985) advocate that one not only determines the outcomes of an intervention, but also establishes that the intervention occurred as planned. This is an important point for the study and implementation of new computer systems and of other new systems, be they human resource or technological interventions.
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Organizational Linkages: Understanding the Productivity Paradox A SYSTEM IMPLEMENTED AND USED MAY NOT INCREASE PRODUCTIVITY Even when a system is implemented successfully (i.e., when employees do in fact use the new system), it may not yield improved organizational performance for at least two important reasons. The first reason, which is well documented in the literature on computer automation and indeed may be unique to computer automation, was discussed in Chapter 2. That is, when automated office systems render a given task easier and faster to accomplish, people often respond by performing the task (e.g., editing a document) more often, with no greater output, precisely because it is now easier and faster to do so. For this reason alone—more frequent use rather than higher levels of relative performance—the successful implementation of office automation is no guarantee of an increase in the performance of the office in which the new system was successfully implemented. But even if people did not perform the same tasks more often after automation than before, the relative performance of the worker and office may still not increase. That is, it still might not be enough because, with some exceptions, office automation affects only a limited portion of users' work tasks. Consider college professors. Access to a computer and word processing package speeds writing, but only in the most limited sense. It does not shorten the time it takes to conduct library, field, or laboratory research; to read background materials; to organize one's thoughts; or to compose a sentence. These are the tasks that consume a professor's writing time, not the physical task of putting letters on a sheet of paper or computer screen. Professors are perhaps an extreme example, but consider secretaries. Secretaries who are asked to carry out edit, after edit, after edit, may well suffer the brunt of the "now it is faster and easier" problem described above. But, for secretaries, much as for professors, office automation affects only a limited portion of their work. Aided by new office systems, secretaries nevertheless still answer telephones; still copy, distribute, and file papers; still look up information; and still meet with their supervisors—all much as they have for decades. In fact, as also pointed out in Chapter 2, office automation may make some portion of an individual's work more efficient while making other portions more difficult. The same principle applies to many other types of organizational interventions. That is, many interventions may influence only a limited part of the targeted employees' jobs. For example, when an organization implements an incentive pay system that rewards specific em-
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Organizational Linkages: Understanding the Productivity Paradox ployee behaviors, employees are likely to increase their performance of those behaviors. Their performance of other important aspects of their jobs that are not rewarded by the new pay plan may be unchanged or even impaired. This is the dilemma faced by organizations when they implement incentive systems to increase raw productivity. Productivity may go up while quality goes down (Kerr, 1988). Similar problems may arise with the purchase of automated manufacturing systems. If a company purchases a new computerized manufacturing resource planning system in the hope of improving company performance, production planning and scheduling may well improve. But improvements in planning and scheduling will yield overall performance improvements only if the company product is well made, marketed well, and suitable for the intended market segment. The point is that improving only one aspect of employee performance is unlikely to be linked to total organizational performance unless attention is also paid to the larger organizational system in which the employee performs. ORGANIZATIONS AS OPEN SYSTEMS: THE OTHER SYSTEMS THAT MATTER Even if office automation did increase individual performance, would that be enough to augment organizational performance? The answer is probably not. This answer rests on the assumption that organizations are "open systems" (Katz and Kahn, 1978), that is, "living systems, existing in a wider environment on which they depend for the satisfaction of various needs" (Morgan, 1986:39). This conceptualization provides, as Morgan notes, ''the crux of many of the most important developments in organization theory over the last fifty years" (p. 39). Within organizational theory, the open systems metaphor has supplanted the "machine metaphor," the notion that organizations, like machines, can and should perform highly repetitive, predictable tasks as efficiently as possible (Morgan, 1986). Instead, the open systems metaphor directs attention to the organization's adaptation to its environment, issues of organizational survival and effectiveness, and the complex interplay of the organizational subsystems that make up the larger organizational system (Katz and Kahn, 1978; Morgan, 1986). Katz and Kahn (1966, 1978) popularized the open systems concept in studying organizational performance. Based on von Bertalanffy's (1950, 1956) work in physics and biology, they proposed a view of organizations as systems of interacting individuals and groups in continuous dynamic relationship to the larger environment in which the organization functions. The inclusion of the larger environment in their
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Organizational Linkages: Understanding the Productivity Paradox model makes it an open systems model, open to the vagaries of the larger world. Building on von Bertalanffy's work, Katz and Kahn identified four major principles that characterize all open systems, be they plant cells, animal organs, individuals, dyads, groups, or organizations. Below, we use their four principles to hypothesize further why single-level, targeted interventions, such as office automation, may fail to yield improvements in organizational performance. One key principle is that of differentiation, integration, and coordination. "Open systems move in the direction of differentiation and elaboration. Diffuse global patterns are replaced by more specialized functions. . . . Social organizations move toward the multiplication and elaboration of roles with greater specialization" (Katz and Kahn, 1978:29). To manage and counterbalance this differentiation, this complexity, all open systems develop integrating and coordinating mechanisms "that bring the system together for unified functioning" (p. 29). Describing the differentiation of organizational systems further, Katz and Kahn suggested that five organizational roles, or subsystems, characterize all organizations: (1) the managerial subsystem (responsible for controlling and coordinating the other subsystems), (2) the adaptive subsystem (responsible for environmental sensing), (3) the maintenance subsystem (responsible for supporting the people and equipment required to do the work), (4) the production subsystem (responsible for transforming organizational inputs into organizational outputs), and (5) the support subsystem (responsible for procurement and disposition as well as facilitating production). The managerial subsystem, as suggested above, coordinates and integrates the subsystems. The greater the effectiveness of the subsystems themselves and their coordination, the greater the effectiveness of the organization. A second open systems principle is that changes in one part of the larger system will have reverberating effects on other parts of the system. The intensity of the reverberations depends on the closeness or tightness of the linkage between the changed element and other elements in the system. Thus, in loosely coupled systems (Weick, 1976), changes in one subsystem can be relatively isolated from the larger system. In tightly coupled systems, however, a small change in any subsystem will yield changes elsewhere in the system through reciprocating linkages. Landing a jet on the deck of an aircraft carrier is an example of a tightly coupled system (Roberts and Sloane, 1988). In this system the smallest deviations in speed of the ship, list of the ship, wind direction, speed of the jet, altitude of the approach, and so forth have great consequences for performance—the safe landing of the jet. Conversely, providing a professor in a university with a personal com
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Organizational Linkages: Understanding the Productivity Paradox puter and word processing software may be very loosely linked to university performance, even if the professor is more "productive." While change in one part of an open system may reverberate throughout the system, change in one part of the system may or may not cause a permanent change in other parts of the system. Indeed, sensing a change in one part of the system, the organization may seek to quell the change, that is, to ensure that the changed element of the system returns to its former state. This is a third key principle of open systems, dynamic homeostasis. As Katz and Kahn (1978:27) explained, "Any internal or external factor that threatens to disrupt the system is countered by forces which restore the system as closely as possible to its previous state. . . . The basic principle is the preservation of the character of the system" (emphasis in original). The fourth principle of open systems is that of equifinality, that is, "a system can reach the same final state from differing initial conditions and by a variety of paths" (p. 30). Equifinality for organizations as systems is equivalent to the compensatory model for predicting individual performance. The compensatory model indicates that numerous strengths correlate with performance, but they can exist in different configurations and still yield equivalent levels of performance. In the study of organizations as systems, a similar compensatory flavor exists. Below, we present some hypotheses derived from these open systems principles that are useful for understanding individual-organizational performance linkages. Again, we focus on office automation as a continuing foil for the explication of our perspective, but the principles apply equally well to other performance-enhancing interventions. Differentiation, Integration, and Coordination The open systems principle of differentiation, integration, and coordination suggests that automating office systems may differentially affect the subsystems of an organization. Just as office automation may speed and ease only a subset of an individual office worker's tasks, so the system may speed and ease only a subset of an organization's tasks. In fact, automating one set of tasks in an organization may make other tasks even more difficult, and not only for the job that is automated. Often, then, automating a job is most likely to enhance only the production subsystem of the job that is automated. Word processing, for example, speeds the production of documents, but it fails to speed the production of research, of thoughts, or even of sentences. Automated office systems, hypothetically, should augment the support subsystem of the organization. Automated teller machines (ATMs),
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Organizational Linkages: Understanding the Productivity Paradox for example, ease the receipt of deposits from customers and the distribution of cash to customers, a support function in banks. But, as noted in Chapter 2, because ATMs make these functions easier, customers make deposits and withdrawals at more frequent intervals than prior to this automation. Automated office systems are even less likely to ease or enhance managerial and adaptive tasks. Indeed, Schrage (1991:C-3) suggested that at least some office automated systems are inimical to effective managerial and adaptive performance: The most dangerous, hideously misused and thought-annihilating piece of technology invented in the last 15 years has to be the electronic spreadsheet. Every day, millions of managers boot up their Lotus 1-2-3s and Microsoft Excels, twiddle a few numbers and diligently sucker themselves into thinking they're forecasting the future. . . . It's an intellectual exercise that stretches the fingers more than the mind. . . . You can't understand risk—let alone manage or reduce it—by cramming it into a spreadsheet or the quantitative "flavor of the month." In sum, office automation may in some ways enhance the performance of some organizational subsystems (production of office work, support); may impair the performance of other subsystems (managerial, adaptive); and may, as we discuss below, tax other organizational subsystems, particularly the maintenance subsystem. The analysis thus far points to one reason office automation may not engender improvements in organizational performance: Even if the automation is successfully implemented, the positive effects may be limited and the unintended negative consequences may cancel the positive effects. Organizational performance, in our view, is the culmination of the coordinated integration of all organizational subsystems. Improving the performance of one small part of the work that must be accomplished in an organization is unlikely to enhance organizational performance, we hypothesize, especially if the performance of some organizational subsystems is reduced in the process. Reverberations throughout the System When office automation alters an organization's production, support, managerial, or adaptive subsystems, the changes will reverberate throughout the organization and may necessitate ancillary and often unintended changes in other subsystems. Thus, for example, the installation of new equipment in the production subsystem may necessitate changes in the lighting, temperature, cleanliness, and technical maintenance of the production area. It may also require installation of privacy, confidentiality, and security safeguards to protect the data con-
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Organizational Linkages: Understanding the Productivity Paradox tained within the new office system (U.S. Office of Technology Assessment, 1985). And it may require new procedures to coordinate work tasks within the production function. The reverberations from the installation of new office automation surely will be felt beyond the subsystem in which the new office system is installed (Loveman, 1988; Majchrzak and Klein, 1987; Trist, 1981). Thus, for example, the installation of new office automation necessitates changes in the maintenance subsystem, the people and equipment required to do the work. While the installation of office automation is often expected to reduce direct labor costs (Ayres and Miller, 1983), the available evidence (e.g., Gutek et al., 1984) suggests that reductions in labor cost are in fact rare. Moreover, the installation of office automation may require changes in the skills employees need to perform their jobs (Majchrzak and Klein, 1987; U.S. Office of Technology Assessment, 1985). This can require the hiring of more highly skilled persons who require higher salaries. Further, current employees may need retraining, jobs may have to be redesigned, reward systems may have to be changed, and supervisory relations may change (Barley, 1986; Helfgott, 1988; Klein et al., 1990; Majchrzak and Klein, 1987; Schneider, 1990b). Even the employees of the vendors from whom the equipment was purchased may have to be integrated into the work force as they try to maintain, literally, the office automation (Hines, 1985). The changes described above are expensive and disruptive. It takes time, money, and extensive planning and coordination for them to work smoothly and effectively. Selection and training for the new system apply not only to people who will use the new system, but to the recipients of the materials that the new system produces. Especially in tightly coupled systems, change is like a ricocheting bullet introduced into a room with steel walls; it is difficult to predict exactly where it will hit next, but it will hit. Thus, from the principle of reverberation, we derive additional reasons why the implementation of office automation may fail to yield the anticipated improvements in organizational performance: Gains in the outputs of some subsystems (e.g., production) may be offset, at least for some period of time, by increases in the costs of other subsystems (e.g., maintenance). Nothing presented here about the implications of the principle of reverberation should be read as unique to the problems associated with office automation. We make the point again, then, that these principles apply to diagnosing and understanding the possibilities for enhancing the potential of all kinds of interventions that might improve the linkage between individual and organizational performance.
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Organizational Linkages: Understanding the Productivity Paradox innovation that separates workers from each other because the innovation is said to yield improved individual productivity. Since the early 1950s it has been known that separating individuals who are accustomed to working in teams can destroy morale, increase accidents, and decrease productivity (Trist, 1981). Recent case studies reveal similarly inappropriate choices of technology when seeking productivity improvements (e.g., Klein et al., 1990). Organizations may err in thinking that there is only one way to achieve productivity—be that one way office automation or TQM. Indeed, the open systems framework suggests that each organizational system is unique and is embedded in its own unique environment. Thus, each system must find its own way to maximize performance. What works for one organization may not work for another. Indeed, it probably will not. Implications of Open Systems Theory Although our focus has been on explaining why interventions designed to improve individual performance fail to enhance organizational performance, open systems theory suggests a number of strategies by which organizations can maximize the potential performance benefits of an intervention. First, organizations should devote ample resources (including time and money) to effective implementation of the intervention. Unless implementation is effective, unless employees accept and use the most advantageous procedures of the new system, the intervention is doomed to have a minimal, or even harmful, effect on organizational performance (Tornatzky and Fleischer, 1990). The "laundry list" of suggestions for enhancing implementation presented above—including providing extensive training, user support, time to experiment with the new system, rewards, user involvement, and so on—may lack theoretical parsimony; but at the least it provides a useful checklist for organizations in the process of implementing new systems. Tornatzky and Fleischer (1990) and Klein and Ralls (in press) present an extended treatment of these suggestions for enhancing the usefulness of interventions in organizations. Second, organizations should analyze carefully the potential impact of an intervention, even under ideal circumstances, on the facets of individual performance. Even successfully implemented interventions may fail to enhance total individual performance, let alone organizational performance, because the system is targeted at only one or several facets of a more complex job. Office automation is a good case in point. It is a mistake, as we discuss in greater detail below, to assume that a new software program for word processing will turn total
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Organizational Linkages: Understanding the Productivity Paradox individual performance around. It is also, we believe, a mistake to focus on the production of software programs as the culprit keeping down the expected increments in organizational performance from implementing office automation (Abdel-Hamid and Madnick, 1989). Third, organizations should attend to the multiple subsystems of the organization that might be affected by the intervention. Installing new automated systems for the production subsystem of the organization alone may well fail to enhance organizational performance. Installing new automated systems for the production subsystem and making coordinated changes to the other subsystems of the organization may enhance organizational performance. There is some evidence that attention to other subsystems can yield positive outcomes from an intervention. For example, Schneider (1990a) described a personnel selection intervention that, when combined with changes in training for the new incumbents and the old supervisors, new reward systems for incumbents, and new career plans, resulted in a 30 percent reduction in turnover; the estimated decrease in turnover given the selection program alone was 10 percent. Other examples of how a multisubsystems approach to understanding the potential in an intervention can yield positive consequences for organizational performance exist. For example, Banas (1988) described such an approach for a program designed to enhance participation in decision making at the Ford Motor Company, and Shea and Guzzo (1986) described a similar perspective for the successful use of quality circles. Fourth, the open systems model suggests that organizations should undertake multiple kinds of interventions in multiple subsystems of the organization when the goal is to enhance total organizational performance. In combination, suggestions three and four hypothesize that when a multifaceted intervention is placed into the organization the consequence can be enhanced organizational performance. The principle here, derived from an open systems framework, is that simultaneous implementation of a variety of changes across a variety of organizational subsystems can yield the intended effect. Thus, for example, an organization might implement new office automation systems to speed production tasks (e.g., new computer graphics and word processing systems to speed the production of advertising copy) and at the same time target the following: the maintenance subsystem (e.g., by implementing goal setting, training, new selection systems, team-building exercises, or group incentives); the support system (e.g., by implementing new customer ser-
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Organizational Linkages: Understanding the Productivity Paradox vice procedures and customer feedback mechanisms and new information strategies for keeping employees informed); the adaptive subsystem (e.g., by undertaking new market research and R&D, and developing alternative scenarios of the future organizational environment); and the managerial subsystem (e.g., by increasing efforts to provide organizational members with a vision of the organization of the future and increasing coordination among all subsystems to ensure a sharing of the new vision). Surely, such a multifaceted, large-scale effort at organizational change cannot be undertaken all at once (Mohrman et al., 1989; Roitman et al., 1988). Yet this description provides, we think, a realistic assessment of the magnitude of the effort necessary for an intervention targeted on individuals to improve the performance of an organization. Beyond Open Systems Theory: The Symbolism and Politics of Office Automation The open systems model is a powerful heuristic for understanding organizational functioning and performance. It suggests several provocative and convincing hypotheses about why the implementation of any one intervention in an organization may fail to augment organizational performance. Nevertheless, the open systems framework may be limiting in some respects. That is, it directs attention primarily to the rational structure and functioning of organizations and to the human resources consequences of organizational structure and functioning. Although adopting an open systems perspective broadens the range of issues requiring attention, it still excludes some psychologically important issues. That is, the open systems perspective may be a bit too neat to capture the feelings, meanings, and emotions attached to working and living in organizations, especially the feelings, meanings, and emotions attached to innovations in how people work. Bolman and Deal (1984, 1991) offered such an alternative systems view of organizations. They proposed four frames, or lenses, through which to view organizational phenomena. Each frame has considerable theoretical and empirical support. The four frames are (1) the structural or rational frame, (2) the human resources frame, (3) the political frame, and (4) the symbolic frame. The structural or rational frame emphasizes the intentionality and goal directedness of organizations and how decision making is influenced by intentions and the larger context of the organization. The open systems framework fits this lens. The human resources frame
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Organizational Linkages: Understanding the Productivity Paradox emphasizes the idea that people occupy organizations and behave like people (with all their complex abilities, personalities, defenses, and so forth) and that organizations should be organized in ways that acknowledge the humanness of people. In our description of the open systems model, we emphasized the human assets of organizations, especially in our discussion of the implications of office automation for the maintenance subsystem. Bolman and Deal's third frame, the political frame, acknowledges the fact that organizations do not have an unlimited supply of resources to meet all individual, group, and functional desires. Limited resources create conflict in all systems. An understanding that this conflict is invariably traceable to the scarcity of resources helps to explain the existence of conflict in organizations, the formation of coalitions, and the negotiation over organizational goals and decisions. Within the political frame, power is the critical resource—the resource that controls the distribution of other scarce resources. Finally, the symbolic frame focuses on the issue of ''meaning," the processes by which events are given meaning, and the different meanings the same events may have as a result of the relative ambiguity of the context of the event. Humans must, by their very nature, make casual attributions about why events occur and what they mean. By making these attributions, people derive meaning. Some call this meaning climate, others call it culture (Schneider, 1990b). Regardless, it is not what actually happens that is important, but the meaning ascribed to it. The four frames allow one "to try on a variety of spectacles and spend more time dealing with the complexity of human organizations before we can safely conclude that they are actually as simple as existing models make them out to be" (Bolman and Deal, 1984:239; emphasis in original). The symbolic and political frames provide valuable and relatively new perspectives on the organizational consequences of the implementation of office automation and other interventions. The symbolic frame offers a way of understanding some psychological consequences of organizational interventions. Using this frame, one asks, from an employee's vantage what is the symbolic meaning of a given organizational intervention? That is, what message is sent to employees when they know the intervention is being put in place? For office automation, the message may be, you are not valued as a person with hopes, feelings, desires, and needs; you are a machine and we are buying a more reliable, less costly one and you are gone. Thus, for those affected, office automation may be a disheartening and even a deeply insulting symbol to office workers. Indeed, in their study of the implementation of computer-integrated manufacturing at a 150-employee manufacturing company, Roitman et al. (1988) found that employee
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Organizational Linkages: Understanding the Productivity Paradox reactions to the new technology were shaped by the extent to which each employee's job was likely to be eliminated, or their power and status diminished, because of the planned changes. On the other hand, office automation may have a positive symbolic value for employees. It may indicate that they are valued ("management cares enough to give us new and better tools to work with") and that the organization is moving ahead ("we really are an organization of the 1990s"). Office automation may also have a symbolic value for customers, symbolizing (managers hope) the success, efficiency, and modernity of the organization (Schneider and Bowen, 1985). The political frame encourages one to analyze the political issues surrounding an organizational intervention. Pettigrew's (1973) classic study of a large British retail chain's decision to purchase a computer for automated recordkeeping documented the politics of decision making regarding this innovation. In a large-scale qualitative effort, Pettigrew gained access to letters exchanged between members of the retail chain and potential suppliers of the new computer system. He showed that members of one coalition within the retail chain, who favored one vendor over all others, were able to dominate negotiations, to solicit favors from the preferred vendor, and to dictate the eventual choice. More recently, Dean (1987) recorded the politics of the decision-making process for the purchase of automated manufacturing equipment (e.g., computer-aided design, manufacturing resource planning, robotics, computer-integrated manufacturing). Dean (1987:56–57) wrote, It turns out that it is a "bottom-up" decision process, with technology proponents attempting to build a strategic/financial, social, and political structure to support approval. Numerous subtle tactics are used by proponents in constructing this support. Focusing not on the adoption process but on the reactions of users to a new computer-automated technology (specifically to a computer-automated financial information system), Markus (1987:80) provided a similar analysis of the politics of computerization: When the introduction of a computerized information system specifies a distribution of power which represents a loss to certain participants, these participants are likely to resist the system. Conversely, when the distribution of power implied in the design of an information system represents a gain in power to participants, these participants are likely to engage in behaviors that might signify acceptance of it. . . . In general, one would not expect people who are disadvantaged in their power position by a system to accept it (gracefully), nor would one expect people who gain power to resist.
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Organizational Linkages: Understanding the Productivity Paradox Finally, Klein et al. (1990:27) described the organizational consequences of such a shift of power in their case study of the implementation of computer-aided design and drafting: Because Buildco drafters and designers received training and their managers and supervisors did not, drafters and designers gained technical expertise that both supervisors and managers lacked. As a result, supervisors guided their employees with shaken confidence and diminished power. The implication of the application of Bolman and Deal's four frames to the individual-organizational linkage problem is that it may not be enough for an organization to consider the structural and rational benefits and consequences of an intervention. Nor may it be enough for an organization to consider an intervention's structural/rational and human resources consequences, although that is a substantial improvement over the first tactic. We hypothesize that organizations that consider the implications and consequences of interventions for each frame are likely to experience improved organizational performance. Thus, organizations must ask the following questions: (1) To what extent does the intervention improve the structure and heighten the rationality of key organizational subsystems? (2) To what extent does it require or invite changes in the human resources practices of the organization? (3) What does it symbolize to organizational members (and perhaps to customers, too; Zeithaml et al., 1990)? (4) How will its implementation alter the existing balance of power within the organization? SUMMARY AND CONCLUSION In this chapter we have outlined a number of reasons why a single, individual-level intervention, such as office automation, may fail to improve organizational performance. To summarize, we offer the following propositions regarding the relationships one may expect to find between interventions targeted on improving individual performance and increments in organizational performance: The decision to adopt an organizational intervention does not ensure its successful implementation or use. Many interventions are adopted but unused or underused, so links between the intervention and organizational performance will be nonexistent. Even organizational interventions that are successfully implemented and used may do little to improve individual—much less, organizational—performance. This is because such interventions may have an effect on only a few dimensions of individual performance.
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Organizational Linkages: Understanding the Productivity Paradox An intervention put in place in one subsystem of an organization (e.g., the production subsystem) can improve organizational performance to the degree that the intervention is integrated with the imperatives of the other subsystems of the organization (e.g., the maintenance subsystem). The managerial subsystem in organizations is responsible for ensuring the coordination and integration of interventions across the subsystems of the organization. Particular interventions may fail to enhance organizational performance because they are not the most appropriate intervention for an organization. Interventions that will enhance organizational performance are likely to have been carefully chosen to fit the requirements and culture of the setting, to focus ideally on reducing costs and on improving output, and to not be based on a quick-fix mentality or keeping up with the Joneses. Interventions in organizations are likely to enhance organizational performance to the degree that they are symbolically positive with respect to the employees' productivity motivation, individual desires, and perceptions of organizational needs. The decision to adopt an intervention, the procedures by which an intervention is implemented, and the organizational reaction to the intervention all have political overtones. The effects of an intervention on organizational performance will be determined by the degree to which political issues are dealt with in a way that yields a sense of trust throughout the organization. It is our hypothesis that all of the issues illuminated in these propositions require simultaneous attention if an intervention targeted on improving individual performance is to improve organizational performance. The research literature and our conceptualization of organizations as open systems with important symbolic and political overtones coalesce to yield the conclusion that quick fixes and fads do not work. Interventions that are carefully adopted, implemented in ways that take into account their symbolic and political realities, and integrated throughout the multiple subsystems of organizations may yield improved organizational performance. REFERENCES Abdel-Hamid, T.K., and S.E. Madnick. 1989. Lessons learned from modeling the dynamics of software development. Communications of the ACM 32:1426–1438. Argote, L., P.S. Goodman, and D. Schkade. 1983. The Human Side of Robotics: Results from a Prototype Study on How Workers React to a Robot. Report No. 83-11, The Robotics Institute. Pittsburgh: Carnegie Mellon University.
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Representative terms from entire chapter: