Can Elliott Jaques’s theory of Requisite Organization and trust-building hierarchies mesh with Francis Fukuyama’s social capital arguments regarding trust and trust-building within a culture?
According to Jaques in the introduction to Requisite Organization: A Total System for Effective Managerial Organization and Managerial Leadership for the 21st Century (1996) the aim of requisite organization theory of management structure is:
to develop organizational structures and organizational processes which can provide the top flight working and business effectiveness, in which:
- People can rest secure in the knowledge that they can trust each other to work together in an honest and straight forward manner.
- They can use their personal capability to the full, both to their own personal satisfaction, and to the contribute fully to the successful functioning of the organization.
The problem is trust.
Distrust destroys organizations. The Roman Catholic Church is facing dire times because they had been surviving off the largess of previous generations’ accumulation of trust. This trust has been largely destroyed by the pedophile priests scandal. The church leadership’s handling of individual cases, moving a priest rather than disciplining him, led to the current mistrust among the laity.
Had the Catholic leadership dealt severely with this egregious sin against its own young, the laity — and their contributions — would still be firmly behind the leadership. Instead, the church covered up the scandals and failed to discipline most priests who were accused.
Because they avoided the problems then, they paid a much larger price now. The Catholic church could have taken action which would have chilled some of the behaviour in the priesthood but did not choose this difficult and hard path.
This distrust of the leadership to handle sin within its own ranks led to a incredibly quick destruction of the laity’s trust.
I’m not sure what Jaques would have said about this scandal, or indeed what he did say before he died in 2003. He generally states that if you get the organizational structures right, trustful relationships will develop. The Roman Catholic Church has two parts: one is the membership which would be an association in Jaques’s terms; the other is the management accountability hierarchy of the clergy, which would fit his idea of a MAH. The way that one deals with an Association is quite different from how one deals with those in the hierarchy.
I think that Jaques’s ideas about the Association — which are only briefly touched on in the works that I have read thus far but are perhaps more fully developed in Health Services (1978), Hospital Organization (1973) and A General Theory of Bureaucracy (1976) — could more fully inform the ideas of social capital and social trust. And I think that he didn’t quite get that MAHs have Associations within them. For example, a manufacturing firm will have hierarchical organization but will also have engineers in their own professional society which meet the definition of Association. I’m also interested where the idea of clique or social group ends and “association” (whether Jaques’s or Fukuyama’s definition, although they may not differ that greatly) begins.
In Trust: The Social Virtues and the Creation of Prosperity, Francis Fukuyama argues about trust, obviously, but in a different way.
… when the information age’s most enthusiastic apostles celebrate the breakdown of hierarchy and authority, they neglect one critical factor: trust, and the share ethical norms that underlie it. Communities depend on mutual trust and will not arise spontaneously without it. Hierarchies are necessary because not all people within a community can be relied upon to live by tacit ethical rules alone. A small number may be actively asocial, seeking to undermine or exploit the group through fraud or simple mischievousness. A much larger number will tend to be free riders, willing to benefit from membership in the group while contributing as little as possible to the common cause. Hierarchies are necessary because all people cannot be trusted at all times to live by internalized ethical rules and and do their fair share. They must ultimately be coerced by explicit rules and sanctions in the event that they do not live up to them. [p.25]
At first, it seems like he would disagree fundamentally with Jaques. But let’s see first where they meet. Fukuyama’s ideas about the hierarchy imply that these organizational structures are necessary to maintain trustful relationships because they have the ability to coerce and sanction those who do not want to play well with others. In this way, he would be arguing that hierarchies create trust by reducing the amount of actions that will not follow the rules. Jaques, of course, makes a much stronger argument that requisite hierarchies create trust between subordinates and boss, and between subordinates and subordinates. They both believe that hierarchies can be useful in creating trustful relationships but differ on whether hierarchies create good trust.
Requisitely organizing strengthens the social network so necessary to social capital and trust in Fukuyama’s discussions. When a company becomes requisitely organized (structured naturally), the new structure creates trustful relations between peers (at the same level) which provide the necessary antecedents for social networks. This provides a platform for knowledge sharing or trading and other forms of social networking. If I can trust my peers to peer with me, then I can enter into a variety of creative work arrangements with them. When structure is clear already, we can get down to work.
A Requisite Organization does not remove the need for these social networks in the work environment. Instead it may create an atmosphere of trust that fosters their development.
I wonder about the areas that Fukuyama identifies as distrusting societies: southern Italy, China (PRC and Taiwan) and France. Would an requisitely organized business perform better there, or would the idea simply not work? I think that Requisite Organization would require an associative society with looser familial relationships (e.g., U.S.A., Germany, Japan) in order to work. Perhaps these nations cannot have requisite organization structure for their businesses since to do so would be to go against the strong nepotism that underlies their success.
Maybe the only organizations that can be requisitely organized are those of organized crime or crime gangs. This seems to be the case in Russia, another low-trust society that lacks the other elements that stabilize France and China.
On the idea of the Modern Therapeutic Cult, which I have discussed in greater detail elsewhere, I propose that if we organized American businesses requisitely, and applied these principles to identifying high-potential young people, we could reduce the amount of depression and psychological problems. Jaques makes a similar argument, saying that we spend so much time in organizations that their dysfunction can be a cause of psychological problems. Remove the organizational dysfunction and, voilà, the person gets immediately better. Of course, the person may still have personal psychological issues that he or she may wish to deal with. But the point is to solve the structural problem rather than try to get the person to behave in a better way within the dysfunctional structure.
There must be some reason why Americans are so much more depressed than they were even during the Great Depression. Some have theorized that the excess of choices has created a paralysis of choosing. Others have theorized that it comes from “learned helplessness”; that is, we have been taught in late twentieth century America that we are helpless to change our situation. After being taught this for some time, we no longer try to avoid painful situations.
Our massively dysfunctional organizations have created learned helplessness. You learn that you are helpless whenever you work for a boss who is at your own level of complexity-processing (or below) because anything that you do will result in his or her ire, especially trying to work hard. The dysfunction of the organization creates a string of situations that teach you that you cannot affect your work life for the better. No matter what you do, your boss doesn’t think any higher of you.
Related articles on this site
- Social Capital and Requisite Organization
- Vishal Mangalwadi on the Culture of Trust Necessary for Economic Growth
- Trust Is Necessary To Society. The Glacier Model Builds Trust
- Social Capital and Human Capital, Trust & Keiretsu
Image credit: Dome of the Belgian royal greenhouses in Laeken (external). © E. Forrest Christian