6Published by the Harvard Business School Press in hardcover, 1992; in paperback, 1994
© 1992 by Jeffrey Pfeffer All rights reserved Printed in the United States of America
00 01 02 12 11 10 (pbk)
The Library of Congress has catalogued the hardcover edition of this title as follows:
Pfeffer, Jeffrey. Managing with power : politics and influence in organizations / Jeffrey Pfeffer.
p. cm. Includes bibliographical references and index.
9781422143452 1. Decision-making. 2. Power (Social sciences) 3. Organizational behavior. I.
Title. HD30.23.P47 1992 658.4’095 — dc20
91-26237 CIP
ISBN 0-87584-440-5 (pbk)
The paper used in this publication meets the requirements of the American National Standard for Permanence of Paper for Printed Library Materials Z39-49—1984.
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Table of Contents
Title Page Copyright Page Acknowledgments PART I – Power in Organizations
1 – Decisions and Implementation 2 – When Is Power Used? 3 – Diagnosing Power and Dependence
PART II – Sources of Power
4 – Where Does Power Come From? 5 – Resources, Allies, and the New Golden Rule 6 – Location in the Communication Network 7 – Formal Authority, Reputation, and Performance 8 – The Importance of Being in the Right Unit 9 – Individual Attributes as Sources of Power
PART III – Strategies and Tactics for Employing Power Effectively
10 – Framing: How We Look at Things Affects How They Look 11 – Interpersonal Influence 12 – Timing Is (Almost) Everything
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13 – The Politics of Information and Analysis 14 – Changing the Structure to Consolidate Power 15 – Symbolic Action: Language, Ceremonies, and Settings
PART IV – Power Dynamics: How Power Is Lost and How Organizations Change
16 – Even the Mighty Fall: How Power Is Lost 17 – Managing Political Dynamics Productively 18 – Managing with Power
NOTES BIBLIOGRAPHY INDEX About the Author
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Acknowledgments
I wrote this book mostly because of Gene Webb and Hal Leavitt, colleagues at Stanford. Leavitt had urged me for many years to write a book that would be more accessible to students and managers than much of my other writing. I ignored his advice for a long time. When Webb left the associate dean’s office at Stanford, he began teaching sections of the course, Power and Politics in Organizations, which I had originally developed and taught. He brought new literature and new ideas to the course, but one year he stopped using the text, Power in Organizations, which I had written some years ago and which I use regularly in the course. Gene Webb had served on my thesis committee in the early 1970s when I had been a doctoral student at Stanford. I considered him a friend. When a friend stops using your book, it is clearly time to do something.
For some years, I had been developing new ideas and insights about power in organizations. I was teaching in corporate executive programs, and saw what issues were important and how executives reacted to various ideas and material. I continued to teach the elective course at Stanford, and over the years I had obtained numerous anecdotes and a great deal of feedback from students. For several years, Mike Tushman of Columbia, Charles O’Reilly from UC Berkeley, and I had taught a one-week program entitled, Managing Strategic Innovation and Change, for various companies both in the United States and overseas. From Mike and Charles I had learned a lot about the political dynamics of innovation and change, and the role of power and politics in that process. They, and my students, were also urging me to write a new book.
All of these groups paid a price for their nagging. My students in the course, Power and Politics in Organizations, had to use an earlier draft of the manuscript. Former students, in particular Fran Conley, read a copy. My colleagues who had so vigorously urged on the writing now had the task of providing me with comments, and the help I received from Chip Heath, Dan Julius, Roderick Kramer, Kotaro Kuwada, Charles O’Reilly, Donald Palmer, Michael Tushman, and particularly Gene Webb was extraordinary. Even doctoral students who were working with me at the time were drafted into providing feedback and assistance. Beth Benjamin provided examples and comments, even when she should have probably been working on her thesis. I owe much to these students and colleagues. I have benefited enormously from their feedback and their insights.
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I also owe a great deal to the secretaries who have helped so much on this project, particularly Nancy Banks and Katrina Jaggears. One has to work at the Graduate School of Business at Stanford to appreciate the enormous support faculty are provided, in so many ways. I really do thank the school for the many forms of support and for having me on the faculty.
In January 1985, I met Kathleen Fowler. Kathleen had never dated a faculty member before, and wanted to know what I did. I told her I wrote. She said, “Show me something you have written.” I gave her an autographed copy of Power in Organizations. She read it and stayed awake doing so, mostly. But she, too, said, “Can’t you write something people can read?” We were married in July 1986. She gave me a watch as a wedding present. This book is her present—a little late, but then, life has been more interesting recently.
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Power in Organizations
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Decisions and Implementation
At 5:01 P.M. on October 17, 1989, a large earthquake struck northern California. The earthquake destroyed or severely damaged several sections of freeway and a number of freeway off-ramps, as well as a portion of the San Francisco Bay Bridge. The vivid pictures of the damaged section of the bridge and the collapsed freeway section in the East Bay, which accounted for most of the fatalities, were flashed around the world. Most people recall that repairs to the bridge began immediately, and since the work was literally done around the clock, the bridge was reopened about six weeks later. What most people do not realize, even many living in the San Francisco area, is that some 18 months later, the opening of the San Francisco Bay Bridge was the only completed repair. Not one other damaged highway structure, not one off-ramp, not one other section of freeway had been repaired a year and a half after the quake. Indeed, in the case of the other two major portions of roadway that had been closed by the quake—the so-called Cypress Structure in Oakland and the Embarcadero Freeway in San Francisco—there was still no decision on exactly where, how, or whether to make repairs.
Technical or engineering complexities do not account for the delays, nor do they explain why the Bay Bridge was repaired while nothing else was. San Francisco’s and California’s response to the earthquake presents a situation that is repeated often in both public and private sector organizations—a paralysis that reflects an inability to mobilize sufficient political support and resources to take action. Confronted with a problem, in this case—or opportunities, in some other instances —organizations are often unable to get things accomplished in a timely manner. This inaction can have severe consequences. The continuing closure of the Oakland section of the freeway costs some $23 million per year in extra transportation costs and fuel, while the continuing indecision about the repair of the freeways and off- ramps in San Francisco has cost much more in terms of lost business in the city.
It is, perhaps, not surprising that there is delay and indecision when the issue is as inherently ambiguous as the location and repair of roadways. Even in cases of life and death, however, there are failures to effectively mobilize political support and get things done that have serious consequences. Consider the chronology of the discovery of transfusion-transmitted AIDS, and the subsequent delays in getting anything done about it:
In March 1981, an “Rh baby” received a transfusion of blood provided by a 47- year-old donor at the Irwin Memorial Blood Bank in San Francisco.
In July 1981, epidemiological evidence led many members of the medical community to conclude that the so-called Gay Cancer was a contagious disease, spread by both sexual contact and through blood.
In September 1981, the child who received the transfusion in March was sick, suffering from immune dysfunctions; the donor, also sick, went to his doctor at
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about the same time and noted that he was a regular blood donor. In December 1981, Don Francis, an epidemiologist at the Center for Disease
Control (CDC) wanted to put blood banks on the alert. He argued that if the disease spread like hepatitis, it would be spread by blood transfusions.
In January 1982, the CDC learned that hemophiliacs were dying from a disease with symptoms similar to those spreading through the gay community, and that transfusions seemed to be the mechanism of transmission.
In November 1982, Dr. Selma Dritz, assistant director of the Bureau of Communicable Disease Control at the San Francisco Department of Public Health, was concerned about protecting the integrity of the blood supply; she had documented, at least to her satisfaction, the first case of AIDS transmitted by blood transfusion.1
The reaction by the blood-bank industry was denial. “The first public announcement that AIDS might be in the blood supply brought an angry reaction from blood bankers in the East. . . . Dr. Joseph Bove, who . . . served as an officer of the American Association of Blood Banks, went on network television to say flatly that there still was no evidence that transfusions spread AIDS. Privately, some blood bankers thought the CDC was overstating the possibility . . . to get publicity and, therefore, more funding.”2
On January 4, 1983 (more than a year after it was first suspected that AIDS could be spread by blood transfusions), at a meeting of an ad hoc advisory committee for the U.S. Public Health Service, Don Francis of the CDC was angry. “How many people have to die?” shouted Francis, his fist hitting the table again. “How many deaths do you need? Give us the threshold of death that you need in order to believe that this is happening, and we’ll meet at that time and we can start doing something.”3
In March 1983, the hepatitis antibody screening sought by the CDC was rejected because of opposition from the blood banks, although donor screening was introduced to try to eliminate high-risk donors.
In May 1983, Stanford University Hospital became the only major medical center in the United States to decide to begin testing blood for evidence of AIDS infection. “The rest of the blood industry was stunned. . . . Some said it was a gimmick to draw AIDS-hysteric patients to Stanford from San Francisco hospitals.”4
In January 1984, the blood industry was continuing to stonewall. The cost of AIDS screening would be high; moreover, the industry was afraid of what it would do to both the supply of donors and the demand for blood from nonprofit blood banks. “In early January, Assistant Secretary for Health Ed Brandt set up a conference call of blood bankers and CDC officials to discuss the AIDS problem. The upshot of all the talk was no new FDA policy; instead the blood bankers
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agreed to form a task force to study the issue.”5 The careful reader will have noted that two years have passed since transfusion-transmitted AIDS was diagnosed and one year since Don Francis asked, “How many must die?”
By late 1984, even though there was no longer any real debate about whether AIDS could be spread by blood transfusions, widespread screening for hepatitis or other blood abnormalities still had not begun.
“An estimated 12,000 Americans were infected from transfusions largely administered after the CDC had futilely begged the blood industry for action to prevent spread of the disease. ‘How many people have to die?’ Francis had asked the blood bankers in early 1983. The answer was now clear: thousands would.”6
The battle between the scientists and the blood bankers was far from an even match. The blood bankers were sophisticated users of language, symbols, and all the techniques of interpersonal influence. The very existence of that industry depended on motivating volunteers to support the work of organizations such as the American Red Cross. The blood banks and associated organizations had years of experience in working with the media. They had experience, too, in working the corridors of power in Washington, particularly the government health establishment. The scientists and the epidemiologists felt that truth would triumph, if the data were presented forcefully. But they were not at first influential enough to gain the upper hand in the struggle to change policies on AIDS. By contrast, the blood-bank industry cultivated allies, was shrewd in its use of language to make the risks appear negligible, and mustered all its resources to stall and delay policies that might harm the industry. Of course, those involved in these early struggles, and particularly the gay community, learned their political lessons. Today there is substantial research and public policy attention, and those fighting AIDS have mastered political skills and tactics. Indeed, the recent success—some claim disproportionate success—of efforts to obtain funding for AIDS research suggests that the early failure of the authorities to act occurred not so much because AIDS was a gay disease (although this was clearly a part of the story), but rather as a consequence of the lack of political will and expertise on the part of those fighting the traditional medical establishment. As they developed both the determination to make changes and the knowledge of how to do so, the outcome of the political struggle changed accordingly.
A distressing story, some will say, but what does this have to do with organizations in the private sector, which, after all, have the profit incentive to ensure that they make smart, rational, and timely decisions? Just this: Do you know which corporation invented the first personal computer as we know it today, the first word processing program applied in publishing, the mouse, the idea of windows on a computer screen, the use of icons rather than commands to make computers work, and which corporation was the first to run a television advertisement for a personal computer? If you answered, Apple Computer, you are
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partly right, in that the Macintosh, built and marketed by Apple, was the first computer to have these features and be commercially successful on a large scale. But it was, in fact, the Xerox Corporation, at its Palo Alto Research Center (PARC), that accomplished all these things in the mid-1970s, years before the introduction of the Lisa in 1983 and the introduction of the Macintosh in January 1984.7 We all know that the first company to invent or develop a technology does not necessarily reap the economic benefits from that technology—Ampex Corporation’s development of the technology for the VCR is another commonly cited example. What we don’t often recognize is that failures to capitalize on innovations are, in actuality, failures in implementation, the same sort of failures in the ability to get things done that we saw in the case of rebuilding San Francisco roads and in protecting the nation’s blood supply. Accomplishing innovation and change in organizations requires more than the ability to solve technical or analytic problems. Innovation almost invariably threatens the status quo, and consequently, innovation is an inherently political activity.
The inability to get things done, to have ideas and decisions implemented, is widespread in organizations today. It is, moreover, a problem that seems to be getting worse in both public and private sector organizations. It has led to calls for better leadership, and laments about the absence of leadership in many spheres. It is my thesis that problems of implementation are, in many instances, problems in developing political will and expertise—the desire to accomplish something, even against opposition, and the knowledge and skills that make it possible to do so. Today more than ever, it is necessary to study power and to learn to use it skillfully, since we cannot otherwise hope to gain individual success in organizations or the success of the organizations themselves. As Richard Nixon wrote:
It is not enough for a leader to know the right thing. He must be able to do the right thing. The . . . leader without the judgment or perception to make the right decisions fails for lack of vision. The one who knows the right thing but cannot achieve it fails because he is ineffectual. The great leader needs . . . the capacity to achieve.8
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POWER IN ORGANIZATIONS
Norton Long, a political scientist, wrote, “People will readily admit that governments are organizations. The converse—that organizations are governments —is equally true but rarely considered.”9 But organizations, particularly large ones, are like governments in that they are fundamentally political entities. To understand them, one needs to understand organizational politics, just as to understand governments, one needs to understand governmental politics.
Ours is an era in which people tend to shy away from this task. As I browse through bookstores, I am struck by the incursion of “New Age” thinking, even in the business sections. New Age can be defined, I suppose, in many ways, but what strikes me about it are two elements: 1) a self-absorption and self-focus, which looks toward the individual in isolation; and 2) a belief that conflict is largely the result of misunderstanding, and if people only had more communication, more tolerance, and more patience, many (or all) social problems would disappear. These themes appear in books on topics ranging from making marriages work to making organizations work. A focus on individual self-actualization is useful, but a focus on sheer self-reliance is not likely to encourage one to try to get things done with and through other people—to be a manager or a leader. “Excellence can be achieved in a solitary field without the need to exercise leadership.” 10 In this sense, John Gardner’s (former secretary of HEW and the founder of Common Cause) concerns about community are part and parcel of a set of concerns about organizations and getting things accomplished in them.11 One can be quite content, quite happy, quite fulfilled as an organizational hermit, but one’s influence is limited and the potential to accomplish great things, which requires interdependent action, is almost extinguished.
If we are suspicious of the politics of large organizations, we may conclude that smaller organizations are a better alternative. There is, in fact, evidence that the average size of establishments in the United States is decreasing. This is not just because we have become more of a service economy and less of a manufacturing economy; even within manufacturing, the average size of establishments and firms is shrinking. The largest corporations have shed thousands, indeed hundreds of thousands of employees—not only middle managers, but also production workers, staff of all kinds, and employees who performed tasks that are now contracted out. Managers and employees who were stymied by the struggles over power and influence that emerge from interdependence and differences in points of view have moved to a world of smaller, simpler organizations, with less internal
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interdependence and less internal diversity, which are, as a consequence, less political. Of course, such structural changes only increase interdependence among organizations, even as they decrease interdependence and conflict within these organizations.
I see in this movement a parallel to what I have seen in the management of our human resources. Many corporations today solve their personnel problems by getting rid of the personnel. The rationale seems to be that if we can’t effectively manage and motivate employees, then let’s turn the task over to another organization. We can use leased employees or contract workers, or workers from temporary help agencies, and let those organizations solve our problems of turnover, compensation, selection, and training.
It is an appealing solution, consistent with the emphasis on the individual, which has always been strong in U.S. culture, and which has grown in recent years. How can we trust large organizations when they have broken compacts of long-term employment? Better to seek security and certainty within oneself, in one’s own competencies and abilities, and in the control of one’s own activities.
There is, however, one problem with this approach to dealing with organizational power and influence. It is not clear that by ignoring the social realities of power and influence we can make them go away, or that by trying to build simpler, less interdependent social structures we succeed in building organizations that are more effective or that have greater survival value. Although it is certainly true that large organizations sometimes disappear,12 it is also true that smaller organizations disappear at a much higher rate and have much worse survival properties. By trying to ignore issues of power and influence in organizations, we lose our chance to understand these critical social processes and to train managers to cope with them.
By pretending that power and influence don’t exist, or at least shouldn’t exist, we contribute to what I and some others (such as John Gardner) see as the major problem facing many corporations today, particularly in the United States—the almost trained or produced incapacity of anyone except the highest-level managers to take action and get things accomplished. As I teach in corporate executive programs, and as I compare experiences with colleagues who do likewise, I hear the same story over and over again. In these programs ideas are presented to fairly senior executives, who then work in groups on the implications of these ideas for their firms. There is real strength in the experience and knowledge of these executives, and they often come up with insightful recommendations and ideas for improving their organizations. Perhaps they discover the wide differences in effectiveness that exist in different units and share suggestions about how to improve performance. Perhaps they come to understand more comprehensively the markets and technologies of their organizations, and develop strategies for both internally oriented and externally oriented changes to enhance effectiveness. It
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really doesn’t matter, because the most frequently heard comment at such sessions is, “My boss should be here.” And when they go back to their offices, after the stimulation of the week, few managers have either the ability or the determination to engineer the changes they discussed with such insight.
I recall talking to a store manager for a large supermarket chain with a significant share of the northern California grocery market. He managed a store that did in excess of $20 million in sales annually, which by the standards of the average organization makes him a manager with quite a bit of responsibility—or so one would think. In this organization, however, as in many others, the responsibilities of middle-level managers are strictly limited. A question arose as to whether the store should participate in putting its name on a monument sign for the shopping center in which the store was located. The cost was about $8,000 (slightly less than four hours’ sales in that store). An analysis was done, showing how many additional shoppers would need to be attracted to pay back this small investment, and what percentage this was of the traffic count passing by the center. The store manager wanted the sign. But, of course, he could not spend even this much money without the approval of his superiors. It was the president of the northern California division who decided, after a long meeting, that the expenditure was not necessary.
There are many lessons that one might learn from this example. It could be seen as the result of a plague of excessive centralization, or as an instance of a human resource management policy that certainly was more “top down” than “bottom up.” But what was particularly interesting was the response of the manager—who, by the way, is held accountable for this store’s profits even as he is given almost no discretion to do anything about them. When I asked him about the decision, he said, “Well, I guess that’s why the folks at headquarters get the big money; they must know something we don’t.” Was he going to push for his idea, his very modest proposal? Of course not, he said. One gets along by just biding one’s time, going along with whatever directives come down from the upper management.
I have seen this situation repeated in various forms over and over again. I talk to senior executives who claim their organizations take no initiative, and to high-level managers who say they can’t or won’t engage in efforts to change the corporations they work for, even when they know such changes are important, if not essential, to the success and survival of these organizations. There are politics involved in innovation and change. And unless and until we are willing to come to terms with organizational power and influence, and admit that the skills of getting things done are as important as the skills of figuring out what to do, our organizations will fall further and further behind. The problem is, in most cases, not an absence of insight or organizational intelligence. Instead the problem is one of passivity, a phenomenon that John Gardner analyzed in the following way:
In this country—and in most other democracies—power has such a bad name that
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many good people persuade themselves they want nothing to do with it. The ethical and spiritual apprehensions are understandable. But one cannot abjure power. Power, as we are now speaking of it . . . is simply the capacity to bring about certain intended consequences in the behavior of others. . . . In our democratic society we make grants of power to people for specified purposes. If for ideological or temperamental reasons they refuse to exercise the power granted, we must turn to others. . . . To say, a leader is preoccupied with power, is like saying that a tennis player is preoccupied with making shots his opponent cannot return. Of course leaders are preoccupied with power! The significant questions are: What means do they use to gain it? How do they exercise it? To what ends do they exercise it?13
If leadership involves skill at developing and exercising power and influence as well as the will to do so, then perhaps one of the causes of the so-called leadership crisis in organizations in the United States is just this attempt to sidestep issues of power. This diagnosis is consistent with the arguments made by Warren Bennis and his colleagues, who have studied leaders and written on leadership. For instance, Bennis and Nanus noted that one of the major problems facing organizations today is not that too many people exercise too much power, but rather the opposite:
These days power is conspicuous by its absence. Powerlessness in the face of crisis. Powerlessness in the face of complexity. . . . power has been sabotaged. . . . institutions have been rigid, slothful, or mercurial.14 They go on to comment on the importance of power as a concept for understanding leadership and as a tool that allows organizations to function productively and effectively:
However, there is something missing . . . POWER, the basic energy to initiate and sustain action translating intention into reality, the quality without which leaders cannot lead. . . . power is at once the most necessary and the most distrusted element exigent to human progress. . . . power is the basic energy needed to initiate and sustain action or, to put it another way, the capacity to translate intention into reality and sustain it.15
Such observations about power are not merely the province of theorists. Political leaders, too, confirm that the willingness to build and wield power is a prerequisite for success in public life. In this consideration of power and leadership, Richard Nixon offered some observations that are consistent with the theme of this book:
Power is the opportunity to build, to create, to nudge history in a different direction. There are few satisfactions to match it for those who care about such things. But it
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is not happiness. Those who seek happiness will not acquire power and would not use it well if they did acquire it. A whimsical observer once commented that those who love laws and sausages should not watch either being made. By the same token, we honor leaders for what they achieve, but we often prefer to close our eyes to the way they achieve it. . . . In the real world, politics is compromise and democracy is politics. Anyone who would be a statesman has to be a successful politician first. Also, a leader has to deal with people and nations as they are, not as they should be. As a result, the qualities required for leadership are not necessarily those that we would want our children to emulate—unless we wanted them to be leaders. In evaluating a leader, the key question about his behavioral traits is not whether they are attractive or unattractive, but whether they are useful.16
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OUR AMBIVALENCE ABOUT POWER
That we are ambivalent about power is undeniable. Rosabeth Kanter, noting that power was critical for effective managerial behavior, nevertheless wrote, “Power is America’s last dirty word. It is easier to talk about money—and much easier to talk about sex—than it is to talk about power.”17 Gandz and Murray did a survey of 428 managers whose responses nicely illustrate the ambivalence about power in organizations. 18 Some items from their survey, along with the percentage of respondents reporting strong or moderate agreement, are reproduced in Table 1-1.
Table 1-1 Managers’ Feelings about Workplace Politics
Statement Percentage Expressing Strongor Moderate Agreement The existence of workplace politics is common to most organizations 93.2
Successful executives must be good politicians 89.0 The higher you go in organizations, the more political the climate becomes 76.2
Powerful executives don’t act politically 15.7 You have to be political to get ahead in organizations 69.8
Top management should try to get rid of politics within the organization 48.6
Politics help organizations function effectively 42.1 Organizations free of politics are happier than those where there are a lot of politics 59.1
Politics in organizations are detrimental to efficiency 55.1
Source: Gandz and Murray (1980), p. 244.
The concepts of power and organizational politics are related; most authors, myself included, define organizational politics as the exercise or use of power, with power
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being defined as a potential force. Note that more than 90% of the respondents said that the experience of workplace politics is common in most organizations, 89% said that successful executives must be good politicians, and 76% said that the higher one progresses in an organization, the more political things become. Yet 55% of these same respondents said that politics were detrimental to efficiency, and almost half said that top management should try to get rid of politics within organizations. It is as if we know that power and politics exist, and we even grudgingly admit that they are necessary to individual success, but we nevertheless don’t like them.
This ambivalence toward, if not outright disdain for, the development and use of power in organizations stems from more than one source. First, there is the issue of ends and means—we often don’t like to consider the methods that are necessary to get things accomplished, as one of the earlier quotes from Richard Nixon suggests. We are also ambivalent about ends and means because the same strategies and processes that may produce outcomes we desire can also be used to produce results that we consider undesirable. Second, some fundamental lessons we learn in school really hinder our appreciation of power and influence. Finally, in a related point, the perspective from which we judge organizational decisions often does not do justice to the realities of the social world.
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Ends and Means
On Saturday, September 25, 1976, an elaborate testimonial dinner was held in San Francisco for a man whose only public office was as a commissioner on the San Francisco Housing Authority board. The guest list was impressive—the mayor, George Moscone; Lieutenant Governor Mervyn Dymally, at that time the highest- ranking Afro-American in elected politics; District Attorney Joe Freitas; Democratic Assemblyman Willie Brown, probably the most powerful and feared individual in California politics; Republican State Senator Milton Marks; San Francisco Supervisor Robert Mendelsohn; the city editor of the morning newspaper; prominent attorneys—in short, both Democrats and Republicans, a veritable who’s who of the northern California political establishment. The man they were there to honor had recently met personally with the president’s wife, Rosalynn Carter. Yet when the world heard more of this guest of honor, some two years later, it was to be with shock and horror at what happened in a jungle in Guyana. The person being honored that night in September 1976—who had worked his way into the circles of power in San Francisco using some of the very same strategies and tactics described in this book—was none other than Jim Jones.19
There is no doubt that power and influence can be acquired and exercised for evil purposes. Of course, most medicines can kill if taken in the wrong amount, thousands die each year in automobile accidents, and nuclear power can either provide energy or mass destruction. We do not abandon chemicals, cars, or even atomic power because of the dangers associated with them; instead we consider danger an incentive to get training and information that will help us to use these forces productively. Yet few people are willing to approach the potential risks and advantages of power with the same pragmatism. People prefer to avoid discussions of power, apparently on the assumption that “If we don’t think about it, it won’t exist.” I take a different view. John Jacobs, now a political editor for the San Francisco Examiner, co-authored a book on Jim Jones and gave me a copy of it in 1985. His view, and mine, was that tragedies such as Jonestown could be prevented, not by ignoring the processes of power and influence, but rather by being so well schooled in them that one could recognize their use and take countermeasures, if necessary—and by developing a well-honed set of moral values.
The means to any end are merely mechanisms for accomplishing something. The something can be grand, grotesque, or, for most of us, I suspect, somewhere in between. The end may not always justify the means, but neither should it
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automatically be used to discredit the means. Power and political processes in organizations can be used to accomplish great things. They are not always used in this fashion, but that does not mean we should reject them out of hand. It is interesting that when we use power ourselves, we see it as a good force and wish we had more. When others use it against us, particularly when it is used to thwart our goals or ambitions, we see it as an evil. A more sophisticated and realistic view would see it for what it is—an important social process that is often required to get things accomplished in interdependent systems.
Most of us consider Abraham Lincoln to have been a great president. We tend to idealize his accomplishments: he preserved the Union, ended slavery, and delivered the memorable Gettysburg Address. It is easy to forget that he was also a politician and a pragmatist—for instance, the Emancipation Proclamation freed the slaves in the Confederacy, but not in border states that remained within the Union, whose support he needed. Lincoln also took a number of actions that far overstepped his constitutional powers. Indeed, Andrew Johnson was impeached for continuing many of the actions that Lincoln had begun. Lincoln once explained how he justified breaking the laws he had sworn to uphold:
My oath to preserve the Constitution imposed on me the duty of preserving by every indispensable means that government, that nation, of which the Constitution was the organic law. Was it possible to lose the nation and yet preserve the Constitution? . . . I felt that measures, otherwise unconstitutional, might become lawful by becoming indispensable to the preservation . . . of the nation.20
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Lessons to Be Unlearned
Our ambivalence about power also comes from lessons we learn in school. The first lesson is that life is a matter of individual effort, ability, and achievement. After all, in school, if you have mastered the intricacies of cost accounting, or calculus, or electrical engineering, and the people sitting on either side of you haven’t, their failure will not affect your performance—unless, that is, you had intended to copy from their papers. In the classroom setting, interdependence is minimized. It is you versus the material, and as long as you have mastered the material, you have achieved what is expected. Cooperation may even be considered cheating.
Such is not the case in organizations. If you know your organization’s strategy but your colleagues do not, you will have difficulty accomplishing anything. The private knowledge and private skill that are so useful in the classroom are insufficient in organizations. Individual success in organizations is quite frequently a matter of working with and through other people, and organizational success is often a function of how successfully individuals can coordinate their activities. Most situations in organizations resemble football more than golf, which is why companies often scan resumes to find not only evidence of individual achievement, but also signs that the person is skilled at working as part of a team. In achieving success in organizations, “power transforms individual interests into coordinated activities that accomplish valuable ends.”21
The second lesson we learn in school, which may be even more difficult to unlearn, is that there are right and wrong answers. We are taught how to solve problems, and for each problem, that there is a right answer, or at least one approach that is more correct than another. The right answer is, of course, what the instructor says it is, or what is in the back of the book, or what is hidden away in the instructor’s manual. Life appears as a series of “eureka” problems, so-called because once you are shown the correct approach or answer, it is immediately self- evident that the answer is, in fact, correct.
This emphasis on the potential of intellectual analysis to provide the right answer —the truth—is often, although not invariably, misplaced. Commenting on his education in politics, Henry Kissinger wrote, “Before I served as a consultant to Kennedy, I had believed, like most academics, that the process of decision-making was largely intellectual and all one had to do was to walk into the President’s office and convince him of the correctness of one’s view. This perspective I soon realized is as dangerously immature as it is widely held.”22 Kissinger noted that the
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easy decisions, the ones with right and wrong answers that can be readily discerned by analysis, never reached the president, but rather were resolved at lower levels.
In the world in which we all live, things are seldom clear-cut or obvious. Not only do we lack a book or an instructor to provide quick feedback on the quality of our approach, but the problems we face often have multiple dimensions—which yield multiple methods of evaluation. The consequences of our decisions are often known only long after the fact, and even then with some ambiguity.
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AN ALTERNATIVE PERSPECTIVE ON DECISION MAKING
Let me offer an alternative way of thinking about the decision-making process. There are three important things to remember about decisions. First, a decision by itself changes nothing. You can decide to launch a new product, hire a job candidate, build a new plant, change your performance evaluation system, and so forth, but the decision will not put itself into effect. As a prosaic personal example, recall how many times you or your friends “decided” to quit smoking, to get more exercise, to relax more, to eat healthier foods, or to lose weight. Such resolutions often fizzle before producing any results. Thus, in addition to knowledge of decision science, we need to know something about “implementation science.”
Second, at the moment a decision is made, we cannot possibly know whether it is good or bad. Decision quality, when measured by results, can only be known as the consequences of the decision become known. We must wait for the decision to be implemented and for its consequences to become clear.
The third, and perhaps most important, observation is that we almost invariably spend more time living with the consequences of our decisions than we do in making them. It may be an organizational decision such as whether to acquire a company, change the compensation system, fight a union-organizing campaign; or a personal decision such as where to go to school, which job to choose, what subject to major in, or whom to marry. In either case, it is likely that the effects of the decision will be with us longer than it took us to make the decision, regardless of how much time and effort we invested. Indeed, this simple point has led several social psychologists to describe people as rationalizing (as contrasted with rational) animals.23 The match between our attitudes and our behavior, for instance, often derives from our adjusting our attitudes after the fact to conform to our past actions and their consequences.24
If decisions by themselves change nothing; if, at the time a decision is made, we cannot know its consequences; and if we spend, in any event, more time living with our decisions than we do in making them, then it seems evident that the emphasis in much management training and practice has been misplaced. Rather than spending inordinate amounts of time and effort in the decision-making process, it would seem at least as useful to spend time implementing decisions and dealing with their ramifications. In this sense, good managers are not only good analytic decision makers; more important, they are skilled in managing the consequences of their decisions. “Few successful leaders spend much time fretting about decisions once they are past. . . . The only way he can give adequate attention to the decisions he
35
has to make tomorrow is to put those of yesterday firmly behind him.”25 There are numerous examples that illustrate this point. Consider, for instance, the
acquisition of Fairchild Semiconductor by Schlumberger, an oil service company.26 The theory behind the merger was potentially sound—to apply Fairchild’s skills in electronics to the oil service business. Schlumberger wanted, for example, to develop more sophisticated exploration devices and to add electronics to oil servicing and drilling equipment. Unfortunately, the merger produced none of the expected synergies:
When Schlumberger tried to manage Fairchild the same way it had managed its other business units, it created many difficulties. . . . resources were not made available to R&D with the consequence of losing technical edge which Fairchild once had. Creative . . . technical people left the organization and the company was unable to put technical teams together to pursue new technological advancement .27
A study of 31 acquisitions found that “problems will eventually emerge after acquisitions that could not have been anticipated. . . . both synergy and problems must be actively managed.”28 Moreover, firms that see acquisitions as a quick way of capturing some financial benefits are often insensitive to the amount of time and effort that is required to implement the merger and to produce superior performance after it occurs. Emphasis on the choice of a merger partner and the terms of the deal can divert focus away from the importance of the activities that occur once the merger is completed.
Or, consider the decision to launch a new product. Whether that decision produces profits or losses is often not simply a matter of the choices made at the time of the launch. It also depends on the implementation of those choices, as well as on subsequent decisions such as redesigning the product, changing the channels of distribution, adjusting prices, and so forth. Yet what we often observe in organizations is that once a decision is made, more effort is expended in assigning credit or blame than in working to improve the results of the decision.
I can think of no example that illustrates my argument as clearly as the story of how Honda entered the American market, first with motorcycles, and later, of course, with automobiles and lawn mowers. Honda established an American subsidiary in 1959, and between 1960 and 1965, Honda’s sales in the United States went from $500,000 to $77 million. By 1966, Honda’s share of the U.S. motorcycle market was 63%,29 starting from zero just seven years before. Honda’s share was almost six times that of its closest competitors, Yamaha and Suzuki, and Harley- Davidson’s share had fallen to 4%. Pascale showed that this extraordinary success was largely the result of “miscalculation, serendipity, and organizational learning,” not of the rational process of planning and foresight often emphasized in our efforts to be successful.30
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Sochiro Honda himself was more interested in racing and engine design than in building a business, but his partner, Takeo Fujisawa, managed to convince him to turn his talent to designing a safe, inexpensive motorcycle to be driven with one hand and used for package delivery in Japan. The motorcycle was an immediate success in Japan. How and why did Honda decide to enter the export market and sell to the United States? Kihachiro Kawashima, eventually president of American Honda, reported to Pascale:
In truth, we had no strategy other than the idea of seeing if we could sell something in the United States. It was a new frontier . . . and it fit the “success against all odds” culture that Mr. Honda had cultivated. I reported my impressions . . . including the seat-of-the-pants target of trying, over several years, to attain a 10 percent share of U.S. imports. . . . We did not discuss profits or deadlines for breakeven.31
Money was authorized for the venture, but the Ministry of Finance approved a currency allocation of only $250,000, of which less than half was in cash and the rest in parts and motorcycle inventory. The initial attempt to sell motorcycles in Los Angeles was disastrous. Distances in the United States are much greater than in Japan, and the motorcycles were driven farther and faster than their design permitted. Engine failures were common, particularly on the larger bikes.
The company had initially focused its sales efforts on the larger, 250cc and 350cc bikes, and had not even tried to sell the 50cc Supercub, believing it was too small to have any market acceptance:
We used the Honda 5os . . . to ride around Los Angeles on errands. They attracted a lot of attention. One day we had a call from a Sears buyer. . . . we took note of Sears’ interest. But we still hesitated to push the 50cc bikes out of fear they might harm our image in a heavily macho market. But when the larger bikes started breaking, we had no choice. We let the 5occ bikes move. And surprisingly, the retailers who wanted to sell them weren’t motorcycle dealers, they were sporting goods stores.32
Honda’s “you meet the nicest people on a Honda” advertising campaign was designed as a class project by a student at UCLA, and was at first resisted by Honda. Honda’s distribution strategy—sporting goods and bicycle shops rather than motorcycle dealers—was made for them, not by them. And its success with the smaller motorbike was almost totally unanticipated. It occurred through a combination of circumstances: the use of the motorbike by Honda employees, who couldn’t afford anything fancier; the positive response from people who saw the bike; and the failure of Honda’s larger bikes in the American market.
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Honda did not use decision analysis and strategic planning. In fact, it is difficult to see that Honda made any decisions at all, at least in terms of developing alternatives and weighing options against an assessment of goals and the state of the market. Honda succeeded by being flexible, by learning and adapting, and by working to have decisions turn out right, once those decisions had been made. Having arrived with the wrong product for a market they did not understand, Honda spent little time trying to find a scapegoat for the company’s predicament; rather, Honda personnel worked vigorously to change the situation to their benefit, being creative as well as opportunistic in the process.
The point is that decisions in the world of organizations are not like decisions made in school. There, once you have written down an answer and turned in the test, the game is over. This is not the case in organizational life. The important actions may not be the original choices, but rather what happens subsequently, and what actions are taken to make things work out. This is a significant point, because it means that we need to be somewhat less concerned about the quality of the decision at the time we make it (which, after all, we can’t really know anyway) and more concerned with adapting our new decisions and actions to the information we learn as events unfold. Just as Honda emerged as a leader in many American markets more by accident and trial-and-error learning than by design, it is critical that organizational members develop the fortitude to continue when confronted by adversity and the insight about how to turn situations around. The most important skill may be managing the consequences of decisions. And, in organizations in which it is often difficult to take any action, the critical ability may be the capacity to have things implemented.
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WAYS OF GETTING THINGS DONE
Why is implementation difficult in so many organizations, and why does it appear that the ability to get decisions implemented is becoming increasingly rare? One way of thinking about this issue, and of examining the role of power and influence in the implementation process, is to consider some possible ways of getting things done.
One way of getting things to happen is through hierarchical authority. Many people think power is merely the exercise of formal authority, but it is considerably more than that, as we will see. Everyone who works in an organization has seen the exercise of hierarchical authority. Those at higher levels have the power to hire and fire, to measure and reward behavior, and to provide direction to those who are under their aegis. Hierarchical direction is usually seen as legitimate, because the variation in formal authority comes to be taken for granted as a part of organizational life. Thus the phrase, “the boss wants . . .” or “the president wants . . .” is seldom questioned or challenged. Who can forget Marine Lieutenant Colonel Oliver North testifying, during the Iran-contra hearings, about his willingness to stand on his head in a corner if that was what his commander-in-chief wanted, or maintaining that he never once disobeyed the orders of his superiors?
There are three problems with hierarchy as a way of getting things done. First, and perhaps not so important, is that it is badly out of fashion. In an era of rising education and the democratization of all decision processes, in an era in which participative management is advocated in numerous places,33 and particularly in a country in which incidents such as the Vietnam War and Watergate have led many people to mistrust the institutions of authority, implementation by order or command is problematic. Readers who are parents need only reflect on the difference in parental authority between the current period and the 1950s to see what I mean. How many times have you been able to get your children to do something simply on the basis of your authority as a parent?
A second, more serious problem with authority derives from the fact that virtually all of us work in positions in which, in order to accomplish our job and objectives, we need the cooperation of others who do not fall within our direct chain of command. We depend, in other words, on people outside our purview of authority, whom we could not command, reward, or punish even if we wanted to. Perhaps, as a line manager in a product division, we need the cooperation of people in human resources for hiring, people in finance for evaluating new product opportunities, people in distribution and sales for getting the product sold and
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delivered, and people in market research for determining product features and marketing and pricing strategy. Even the authority of a chief executive is not absolute, since there are groups outside the focal organization that control the ability to get things done. To sell overseas airline routes to other domestic airlines requires the cooperation of the Transportation and Justice Departments, as well as the acquiescence of foreign governments. To market a drug or medical device requires the approval of the Food and Drug Administration; to export products overseas, one may need both financing and export licenses. The hierarchical authority of all executives and administrators is limited, and for most of us, it is quite limited compared to the scope of what we need in order to do our jobs effectively.
There is a third problem with implementation accomplished solely or primarily through hierarchical authority: What happens if the person at the apex of the pyramid, the one whose orders are being followed, is incorrect? When authority is vested in a single individual, the organization can face grave difficulties if that person’s insight or leadership begins to fail. This was precisely what happened at E.F. Hutton, where Robert Fomon, the chief executive officer, ruled the firm through a rigid hierarchy of centralized power:
Fomon’s strength as a leader was also his weakness. As he put his stamp on the firm, he did so more as monarch than as a chief executive. . . . Fomon surrounded himself with . . . cronies and yes men who would become the managers and directors of E.F. Hutton and who would insulate him from the real world.34
Because Fomon was such a successful builder of his own hierarchical authority, no one in the firm challenged him to see the new realities that Hutton, and every other securities firm, faced in the 1980s.35 Consequently, when the brokerage industry changed, Hutton did not, and it eventually ceased to exist as an independent entity.
Another way of getting things done is by developing a strongly shared vision or organizational culture. If people share a common set of goals, a common perspective on what to do and how to accomplish it, and a common vocabulary that allows them to coordinate their behavior, then command and hierarchical authority are of much less importance. People will be able to work cooperatively without waiting for orders from the upper levels of the company. Managing through a shared vision and with a strong organizational culture has been a very popular prescription for organizations.36 A number of articles and books tell how to build commitment and shared vision and how to socialize individuals, particularly at the time of entry, so that they share a language, values, and premises about what needs to be done and how to do it.37
Without denying the efficacy and importance of vision and culture, it is important
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to recognize that implementation accomplished through them can have problems. First, building a shared conception of the world takes time and effort. There are instances when the organization is in crisis or confronts situations in which there is simply not sufficient time to develop shared premises about how to respond. For this very reason, the military services rely not only on techniques that build loyalty and esprit de corps,38 but also on a hierarchical chain of command and a tradition of obeying orders.
Second, there is the problem of how, in a strong culture, new ideas that are inconsistent with that culture can penetrate. A strong culture really constitutes an organizational paradigm, which prescribes how to look at things, what are appropriate methods and techniques for solving problems, and what are the important issues and problems.39 In fields of science, a well-developed paradigm provides guidance as to what needs to be taught and in what order, how to do research, what are appropriate methodologies, what are the most pressing research questions, and how to train new students. 40 A well-developed paradigm, or a strong culture, is overturned only with great difficulty, even if it fails to account for data or to lead to new discoveries.41 In a similar fashion, an organizational paradigm provides a way of thinking about and investigating the world, which reduces uncertainty and provides for effective collective action, but which also overlooks or ignores some lines of inquiry. It is easy for a strong culture to produce groupthink, a pressure to conform to the dominant view.42 A vision focuses attention, but in that focus, things are often left out.
An organization that had difficulties, as well as great success, because of its strong, almost evangelical culture is Apple Computer. Apple was founded and initially largely populated by counterculture computer hackers, whose vision was a computer-based form of power to the people—one computer for each person. IBM had maintained its market share through its close relations with centralized data processing departments. IBM was the safe choice—the saying was, no one ever got fired for buying IBM. The Apple II was successful by making an end run around the corporate data processing manager and selling directly to the end-user, but “by the end of ’82 it was beginning to seem like a good idea to have a single corporate strategy for personal computers, and the obvious person to coordinate that strategy was the data processing manager.”43 Moreover, computers were increasingly being tied into networks; issues of data sharing and compatibility were critical in organizations that planned to buy personal computers by the thousands. Companies wanted a set of computers that could run common software, to save on software purchasing as well as training and programming expenses. Its initial vision of “one person—one machine” made it difficult for Apple to see the need for compatibility, and as a consequence:
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The Apple II wouldn’t run software for the IBM PC; the PC wouldn’t run software for Lisa, Lisa wouldn’t run software for the Apple II; and none of them would run software for the Macintosh. . . . Thanks largely to Steve [Jobs], Apple had an entire family of computers none of which talked to one another.44
Apple’s strong culture and common vision also helped cause the failure of the Apple III as a new product. The vision was not only of “one person—one machine,” but also of a machine that anyone could design, modify, and improve. Operating systems stood between the user and the machine, and so the Apple culture denigrated operating systems:
The problem with an operating system, from the hobbyist point of view, was that it made it more difficult to reach down inside the computer and show off your skills; it formed a barrier between the user and the machine. Personal computers meant power to the people, and operating systems took some of that power away. . . . It wasn’t a design issue; it was a threat to the inalienable rights of a free people.45
Apple III had an operating system known as SOS for Sophisticated Operating System, which was actually quite similar to the system Microsoft had developed for IBM’s personal computer—MS. DOS (Microsoft Disk Operating System), except it was even better in some respects. Yet Apple was too wary of operating systems to try to make its system the standard, or even a standard, in personal computing. As a result the company lost out on a number of important commercial opportunities. The very zeal and fervor that made working for Apple like a religious crusade and produced extraordinary levels of commitment from the work force made it difficult for the company to be either cognizant of or responsive to shifts in the marketplace for personal computers.
There is a third process of implementation in organizations—namely, the use of power and influence. With power and influence the emphasis is on method rather than structure. It is possible to wield power and influence without necessarily having or using formal authority. Nor is it necessary to rely on a strong organizational culture and the homogeneity that this often implies. Of course, the process of implementation through power and influence is not without problems of its own; the last section of the book treats some of them and offers some potential palliatives. For now, what is important is to see power and influence as one of a set of ways of getting things done—not the only way, but an important way.
From the preceding discussion we can see that implementation is becoming more difficult because: 1) changing social norms and greater interdependence within organizations have made traditional, formal authority less effective than it once was, and 2) developing a common vision is increasingly difficult in organizations comprised of heterogeneous members—heterogeneous in terms of race and
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ethnicity, gender, and even language and culture. At the same time, our ambivalence about power, and the fact that training in its use is far from widespread, mean that members of organizations are often unable to supplement their formal authority with the “unofficial” processes of power and influence. As a result their organizations suffer, and promising projects fail to get off the ground. This is why learning how to manage with power is so important.
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THE MANAGEMENT PROCESS: A POWER PERSPECTIVE
From the perspective of power and influence, the process of implementation involves a set of steps, which are outlined below. This book is about the details of these steps. At this point, however, it is useful to provide an overview of the process:
1. Decide what your goals are, what you are trying to accomplish. 2. Diagnose patterns of dependence and interdependence; what individuals are
influential and important in your achieving your goal? 3. What are their points of view likely to be? How will they feel about what you
are trying to do? 4. What are their power bases? Which of them is more influential in the
decision? 5. What are your bases of power and influence? What bases of influence can you
develop to gain more control over the situation? 6. Which of the various strategies and tactics for exercising power seem most
appropriate and are likely to be effective, given the situation you confront? 7. Based on the above, choose a course of action to get something done.
The first step is to decide on your goals. It is, for instance, easier to drive from
Albany, New York to Austin, Texas if you know your destination than if you just get in your car in Albany and drive randomly. Although this point is apparently obvious, it is something that is often overlooked in a business context. How many times have you attended meetings or conferences or talked to someone on the telephone without a clear idea of what you were trying to accomplish? Our calendars are filled with appointments, and other interactions occur unexpectedly in the course of our day. If we don’t have some clear goals, and if we don’t know what our primary objectives are, it is not very likely that we are going to achieve them. One of the themes Tom Peters developed early in his writing was the importance of consistency in purpose: having the calendars, the language, what gets measured, and what gets talked about—all focus on what the organization is trying to achieve.46 It is the same with individuals; to the extent that each interaction, in each meeting, in each conference, is oriented toward the same objective, the achievement of that objective is more likely.
Once you have a goal in mind, it is necessary to diagnose who is important in
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getting your goal accomplished. You must determine the patterns of dependence and interdependence among these people and find out how they are likely to feel about what you are trying to do. As part of this diagnosis, you also need to know how events are likely to unfold, and to estimate the role of power and influence in the process. In getting things accomplished, it is critical to have a sense of the game being played, the players, and what their positions are. One can get badly injured playing football in a basketball uniform, or not knowing the offense from the defense. I have seen, all too often, otherwise intelligent and successful managers have problems because they did not recognize the political nature of the situation, or because they were blindsided by someone whose position and strength they had not anticipated.
Once you have a clear vision of the game, it is important to ascertain the power bases of the other players, as well as your own potential and actual sources of power. In this way you can determine your relative strength, along with the strength of other players. Understanding the sources of power is critical in diagnosing what is going to happen in an organization, as well as in preparing yourself to take action.
Finally, you will want to consider carefully the various strategies, or, to use a less grand term, the tactics that are available to you, as well as those that may be used by others involved in the process. These tactics help in using power and influence effectively, and can also help in countering the use of power by others.
Power is defined here as the potential ability to influence behavior, to change the course of events, to overcome resistance, and to get people to do things that they would not otherwise do.47 Politics and influence are the processes, the actions, the behaviors through which this potential power is utilized and realized.
The next two chapters in the first section of this book provide some help both in diagnosing the extent to which situations are going to involve the use of power and in figuring out who the major political actors are and what their points of view are likely to be. The second section of the book has a series of chapters directed at answering the question, where does power come from, and why are some units and people more powerful than others? Implicitly, this section will also help the reader figure out how to get more power, if that is desired. The third section considers the strategies and tactics through which power and influence are used. We need to know not only where power comes from, but how it is employed. The final section of the book addresses issues of power dynamics—and particularly how power, once gained, is lost. It also examines the consequences of power, both positive and negative, for organizations and the vital and necessary role of power in the process of implementation and change. The final summary draws much of this material together by giving some examples of people who used power successfully, and others who did not.
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When Is Power Used?
Although power plays an important part in organizational activity, not all decisions and actions within an organization involve power to the same extent, nor are conflicts of power equally common in every organization. It is important to be able to recognize and diagnose the context if you are to implement your plans effectively. Not understanding the degree to which the situation is politicized may cause a person either to use power and influence when it is unnecessary, and thereby violate behavioral norms as well as waste resources, or to underestimate the extent to which power needs to be employed, and fail in the task of implementation.
An example of the failure to manage politics and use power skillfully is provided by Xerox. The corporation realized that it had missed exploiting the personal computer technology it had invented, that the Palo Alto Research Center was really a treasure trove of ideas, and that there was a gap between great research and the development of a marketable product. In an attempt to commercialize PARC technology more effectively, Xerox established the Express project, a co-development effort with Syntex, a pharmaceutical company. A team of researchers, working with marketing and product development personnel, as well as with the customer, Syntex, set out to develop a system designed to meet the needs of the pharmaceutical industry, and to do it rapidly.
The task was viewed, for the most part, as one of technical coordination, in which the major challenges were to find the right organizational structure and to create a common perspective on the development effort. But the effort was highly politicized, in part because of its high visibility. Departments maneuvered for position, and this political maneuvering was neither well recognized nor well managed.
Marketing did not get involved early on, in part because it was understaffed, and in part because it did not view the co-production effort as critical—this was just an experiment, after all. When the project attained high visibility and it became clear that upper management was very interested in its outcome, marketing decided to get involved. Having come in late, it had to do something to justify its importance— otherwise, it might lose out in future efforts of this type. So with the project already well under way, marketing conducted a study of the product’s ability to be sold more broadly to the rest of the pharmaceutical industry, and also put together a business plan to evaluate the product’s financial attractiveness. The co-production group had already done both of these tasks. However, the marketing group used different assumptions about market penetration and margins (even though the co- production group had used some estimates originally supplied by marketing) and, naturally, came to different conclusions. The marketing group, although late into the fray, had the power of its legitimacy and presumed expertise—after all, who knows more about markets than marketing? The marketing people convinced a group of
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higher corporate executives, already nervous because of the unusual nature of the project (an interdisciplinary team co-developing a project with a customer), that the effort should be stopped before more money was spent. The incident shows that the political nature of the new product development and innovation process was not fully apprehended or successfully managed at Xerox. Not being aware of the importance of power and its use in the context, the project champions lost the project.
This chapter explores the conditions under which power is more or less important in organizational life, and the implications of power for our own career management activities. Finding a position in which the requirements for exercising power are compatible with our interests and abilities is crucial for our individual success and for the success of the projects we sponsor.1
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OCCURRENCE OF POWER AND INFLUENCE ACTIVITIES
There is some limited empirical evidence that can help set the framework for a discussion of the conditions under which power is used. The evidence comes primarily from two types of studies: examinations of actual decision making, and surveys of managers and executives about their perceptions of power and influence activities in their organizations.
A study of some 33 purchase decisions in 11 firms provides useful background information on the importance of influence in decisions of this type.2 The study revealed that, first of all, in 27 of the 33 decisions, there was some disagreement during the decision-making process that required resolution. It also turned out that the more important the decision, the more people involved in it. For decisions of moderate or major importance, almost 20 people on average were involved, while for decisions of less significance, an average of only eight people were involved. With the relatively large number of people involved in a major decision, it is scarcely surprising that differences of opinion emerge. But the real significance of the number is this: think about the task of trying to affect a decision in which 20 or so people are involved. It will clearly be important to carefully map the political terrain, understand the points of view, and spend time and effort on the process. With a smaller number of people involved, one’s attempts at influence can be more ad hoc and still have some chance of success.
From a survey of 428 graduates of a Canadian business school, we learn what types of decisions are perceived to most involve power and influence.3 In Table 2- 1, we see that interdepartmental coordination, promotion and transfer decisions, and decisions about facilities and equipment allocation were thought by many respondents to be highly involved with power. By contrast, work appraisals, hiring decisions, personnel policies, and grievances and complaints were less involved with power.
Table 2-1 Survey Responses about What Organizational Level and What Decisions Most
Involve the Use of Power
Situations % of Respondents Saying That Situation Always orFrequently Involves the Use of Power
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Interdepartmental Coordination
68.4
Promotions and Transfers 59.5
Facilities and Equipment Allocation 49.2
Grievances and Complaints 31.6
Personnel Policies 28.0 Hiring 22.5 Work Appraisals 21.5
Amount of Political Behavior at Various Levels
Level Mean Amount of Use of Power (3 = always; 2 = frequently; 1 = rarely; o = never)
Top Management 1.22 Middle Management 1.07 Lower Management .73
Source: Gandz and Murray (1980), pp. 242, 243.
The same survey provides some interesting information about the amount of power and influence required at various hierarchical levels. This is also displayed in Table 2-1. Not surprisingly, the data show that there is a more political climate, involving the more frequent use of power, at the higher organizational levels.
Another study interviewed three managers in each of 30 organizations, including the chief personnel or human resource officer, the chief executive officer, and one lower-level manager.4 The data from that study permit us to rank both functional areas and situations in terms of the frequency with which power and influence are used. These rankings are displayed in Table 2-2.
Table 2-2 shows that marketing, sales, and the board of directors are the three areas in which power is most used; by contrast, production and accounting and finance are functional areas in which power is less important. In terms of the importance of power in various situations, reorganizations, personnel changes, and resource allocations entail greater use of power, while establishing individual performance standards and changing rules and procedures involve power and
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political activity less frequently.
Table 2-2 What Functions and What Decisions Most Involve the Use of Power
Functional Area Amount of OrganizationalPolitics Marketing Staff 4.27 Board of Directors 3.88 Sales 3.74 Manufacturing Staff 3.05 Personnel 3.01 Purchasing 2.67 Research and Development 2.62 Accounting and Finance 2.40 Production 2.01 Type of Decision Amount of Organizational Politics Reorganizations 4.44 Personnel Changes 3.74 Budget Allocations 3.56 Purchase of Major Items 2.63 Establishing Individual Performance Standards 2.39
Rules and Procedures 2.31 Note: Responses are to the question, “How frequent is the occurrence of organizational politics?” Answers range from 1 = “very low” to 5 = “very high.”
Source: Madison et al., pp. 88, go.
All of these data together suggest that power is more important in major decisions, such as those made at higher organizational levels and those that involve crucial issues like reorganizations and budget allocations; for domains in which performance is more difficult to assess such as staff rather than line production operations; and in instances in which there is likely to be uncertainty and disagreement. We need to understand why these conditions seem to be associated with the use of power and influence. In exploring this subject, we will also discover some of the nuances of power and influence processes in organizations.
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INTERDEPENDENCE
Power is used more frequently under conditions of moderate interdependence. With little or no interdependence, there is little or no need to develop power or exercise influence. By the same token, when interdependence is great, people have incentives to work together, forge common goals, and coordinate their activities. If they ignore these incentives, then their organization or group is likely to fail.
My colleague Jerry Salancik and I have defined interdependence as follows:
Interdependence is the reason why nothing comes out quite the way one wants it to. Any event that depends on more than a single causal agent is an outcome based on interdependent agents. . . . interdependence exists whenever one actor does not entirely control all of the conditions necessary for the achievement of an action or for obtaining the outcome desired from the action.5
The essence of organizations is interdependence, and it is not news that all of us need to obtain the assistance of others in order to accomplish our jobs. What is news is that when interdependence exists, our ability to get things done requires us to develop power and the capacity to influence those on whom we depend. If we fail in this effort—either because we don’t recognize we need to do it or because we don’t know how—we will fail to accomplish our goals.
In the first chapter, we saw that Xerox’s Palo Alto Research Center invented the first personal computer, the Alto, and also made “the first graphics-oriented monitor, the first hand-held ‘mouse’ inputting device simple enough for a child, the first word processing program for nonexpert users, and the first local area communications network, the first object-oriented programming language, and the first laser printer.”6 There are, of course, a number of reasons why Xerox failed to capitalize commercially on its inventive technology, but one source of difficulty was the relationship of PARC personnel to the rest of Xerox. Bringing a new product to market requires the interdependent activity of many parts of the organization; this interdependence was not recognized at PARC, and even when it was recognized, the people involved did not see the need to develop power and influence. It was presumed that the magnificence of the technology would speak for itself and compel the development and introduction of successful products.
PARC was physically removed from the rest of Xerox—the Xerox of Rochester, New York and Stamford, Connecticut. PARC researchers had a healthy dose of arrogance, which led them to cultivate a we/they attitude toward the rest of Xerox,
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including SDS, the computer company that Xerox had purchased to help it enter the computer business:
“PARC suffered from a whole lot of arrogance,” remarks Bert Sutherland, one of a series of managers of PARC’s Systems Science Laboratory. “If you didn’t understand automatically, you were ‘stupid.’ It’s hard to get a good hearing that way.”7 By not appreciating the interdependence involved in a new product launch and the skills required to manage that interdependence, PARC researchers lost out on their ambition to change the world of computing, and Xerox missed some important economic opportunities.
It is especially important to develop power and influence when the people with whom you are interdependent have a different point of view than you, and thus cannot be relied upon to do what you would want. Thus, for example, a study of the process of selecting a dean in 40 colleges located in large state universities found that the greater the interdependence, the greater the amount of political activity on the part of the faculty.8 However, when interdependent faculty were in agreement, there was less political activity. The study indicates that interdependence increases the need for exercising influence, but, of course, the exercise of influence is important primarily when those with whom you are interdependent are not going to do what you want anyway.
Interdependence helps us understand the evidence presented in Tables 2-1 and 2- 2, which show where power is most used in organizations. There is more interdependence at higher levels in the organization, where tasks are less likely to be either simple or self-contained.9 There is more likely to be interdependence in staff positions, in which getting things done almost inevitably requires obtaining the cooperation of others in line management. Interdepartmental coordination is obviously a situation of extreme interdependence, and decisions about reorganizations typically involve a large number of units. Functional units also vary in their interdependence with other units, but it is often the case that sales and marketing stand between engineering or product development, on the one hand, and manufacturing or production on the other.
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Resource Scarcity
Interdependence results from many things, including the way in which tasks are organized. One factor that is critical in affecting the nature and the amount of interdependence is the scarcity of resources. Slack resources reduce interdependence, while scarcity increases it. As an example, consider the case of promotions. If an organization is growing rapidly and there are many promotional opportunities, the competition for promotions will be less intense. Individuals will feel that their chance for promotion depends mainly on their own performance, rather than on the performance of their co-workers. If, however, the organization stops growing and promotion opportunities decline, candidates find themselves in a so-called “zero sum game,” in which each person’s gain is another’s loss. What happens to me in the contest for promotion is now much more contingent on what happens to my competitors, and thus, the degree of interdependence is greater.
This example illustrates why most people prefer to be in situations of plentiful resources. Not only is each person’s chance for obtaining what he or she desires increased, but interdependence is reduced and there is, therefore, less need to develop power and influence in the situation. Since many, although not all, people find the task of developing power and exercising influence difficult or uncomfortable, they prefer situations with as little interdependence as possible.
A study at the University of Illinois explored the effect of power on the allocation of four resources that varied both in terms of their scarcity and their importance to the various academic departments.10 The study indicated that, according to every measure of departmental power employed, departmental power was most strongly related to the distribution of the most scarce resources, and least strongly related to the least scarce resources. Indeed, departmental power negatively predicted the allocation of the least scarce resources, once objective criteria were statistically controlled. The most straightforward interpretation of this result is that the powerful departments, having obtained a disproportionate share of those resources that were scarcest, gave the losers in the struggle, as a partial payoff, a disproportionate share of the resources that were not really contested anyway.
There is other evidence consistent with the argument that scarcity increases the use of power in organizational decision situations. A study at the University of Minnesota examined the allocation of budgets to academic departments over time.11 The study found that there appeared to be a greater effect of departmental power on resource allocations at times when resources were scarcer. Another study examined
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resource allocations to academic departments on two University of California campuses.12 Between 1967 and 1975, on one campus the total budget increased 52% and 11.9% of the faculty positions were lost, while on the second campus, the budget increased by almost 80% and faculty positions actually grew slightly (by .4%). The study observed that departmental power was more strongly associated with budget allocations on the campus facing scarcer resources.13
We can also see that in the interviews reported in Table 2-2, budget allocations were considered among the most political of decisions. To the extent that most organizations customarily face scarce rather than plentiful resources, it is not surprising that the allocation of these resources involves the use of power and influence.
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DIFFERENCES IN POINT OF VIEW
The fact that people are interdependent is not sufficient by itself to create the use of power and influence in organizations. After all, the players on sports teams are interdependent, but we seldom see them stopping to negotiate with each other while the clock is running. If everyone has the same goals and shares the same assumptions about how to achieve those goals, there will be a minimum of conflict. With consensus about what to do and how to do it, there is no need to exercise influence or develop the power to affect others, since they will do what you want in any event.14
But agreement about how to do it is the key. Goals alone are not a reliable index of political activity in a given situation. At first glance, one might think that goals are fundamental to all action, and that disagreement about goals inevitably leads to the use of power and influence. Although there is no comprehensive evidence on this point, observation suggests that it is not invariably true. There is often intense political activity in business firms, in which there is presumably shared agreement about the goal of making a profit. And, there are frequently cordial compromises in the world of governmental politics, where goals are inconsistent but deals can be struck in which the same means are employed to reach several ends.
The greater the task specialization in the organization, the more likely there will be disagreements. This is simply because, when work is divided into different specialties and units, it is more likely that the organization will have people whose differences in background and training will cause them to take different views of the situation. Lawyers are trained to see the world in one way, engineers another, and accountants yet another. Moreover, holding a particular position in an organization causes one to see the world through the information that comes with that position. Marketers get data on sales and market share, production folks on manufacturing costs and inventory levels. Moreover, different positions often have different incentives—sales maximization, cost minimization, innovation, meeting budgets—and these various incentives provide reasons to see the world differently. The aphorism I often use to describe this situation is: where you stand depends on where you sit.
David Halberstam’s history of Ford Motor Company vividly illustrates how education and functional background can condition the ways in which people view their environment. 15 The conflict at Ford (and at other automobile companies as well) between finance and engineering was, at its heart, a conflict about how to view the world. Engineers fundamentally see cars and engines as technological
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challenges, as things to be built. They are interested in developing a technological advantage over their competitors and in being the first to introduce new features. They want to design and build cars that have elements of engineering excellence. Finance analyzes cars less in terms of their aesthetics or their engineering wizardry than in financial terms such as payback period, return on investment, and the amount of capital required to launch new car models or to introduce new technologies of engines or transmissions. The two groups look at the same project from different perspectives, and therefore come, in many instances, to very different conclusions. Ford developed front-wheel drive and numerous other engineering innovations, but it was often one of the last automobile companies to actually put these innovations into its cars. Introducing a totally new transmission and redesigning the car accordingly cost a lot of money, and, unable to prove that such expenditures would produce enough additional revenues to make them profitable, engineering often lost out, at least in the 1960s and 1970s, to finance.
Serious disagreements among people with differing points of view are more likely to emerge in the absence of clear objectives or in the absence of an external threat or competition sufficient to cause subunits to work together. In the 1960s and 1970s, General Motors dominated the automobile industry. It is hard to believe now, but in the late 1950s GM’s biggest concern was antitrust—whether it would be broken up, not whether it could withstand competition. The lack of external competitive pressure, along with its large size and differentiated structure, produced an environment that was prone to organizational politics. John De Lorean noted, for instance, that “objective criteria were not always used to evaluate an executive’s performance.”16 What seemed to be valued more were being a good team player, not standing out too much, and being loyal to one’s boss. De Lorean provided many details of the extremes to which people went to prove loyalty to their boss: hiring a crane and removing a hotel window so that a refrigerator, too large to get in the door, could be placed in the hotel room of a GM executive who liked late-night snacks; picking up their boss at the airport; organizing retinues of people to meet and accompany the boss on tours; finding out the culinary likes and dislikes of their boss, and making sure that every need or desire was accommodated.
The politicking that occurs in the absence of real competitive pressure rarely promotes the success of the organization. It is, consequently, not surprising that political leaders, whether of nations or organizations, like to find a common enemy or an external threat that they can use to make organizational citizens put aside their differences and work together more effectively. For Apple Computer, for a long while, this was IBM, for the Japanese copier companies at the beginning, it was Xerox, and for U.S. automobile companies today, it is the Japanese. It is not coincidental that crossfunctional communication and coordination in U.S. automobile firms increased as the Japanese competition intensified.
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