For Prof. Kim: Organizational Theory

Topic Two Organisation Theory: Multiple Perspectives RMIT University 2 How is Knowledge Created?

• Theory construction? • Collection and analysis of data? • Hypothesis, hypothesis testing? • Social enquiry? • Negotiated? How is knowledge (or truth) derived, and how is knowledge (truth) defended? RMIT University 3 Multiple Perspectives • Theoretical approaches have underpinning “intellectual traditions” • These intellectual “intellectual traditions” are classified as:

• Modernist • Critical Theorist • Symbolic interpretive • Postmodernist Each perspective or tradition, above, has its own ontological and epistemological foundation. RMIT University 4 The Process of Generating Knowledge Knowledge generation consists of a number of interrelated steps with a certain direction of determinism:

Three levels:

Metatheoretical (the foundation of all theories ): A: Ontology: our assumptions about reality. What is ‘real’? B: Epistemology: How do we gain knowledge of the world? What counts as knowledge? How do we know this is the ‘real’ nature of reality? Methodological: Devices used to uncover data or ‘reality’. Theoretical: set of ideas intended to explain facts, events, and the nature of reality. RMIT University 5 The Process of Generating Knowledge • The meta -theoretical, theoretical and methodological levels are organically interrelated. • Different meta -theoretical assumptions ‘determine’ the criteria of scientific explanation (theory), choice of methodology, procedure for theory construction and what one considers to be data. Meta -theoretical Assumptions Methodology Theory/Knowedge Determines Produces RMIT University 6 Example of Meta -Theoretical Assumption Is knowledge objective or subjective? RMIT University 7 Multiple Perspectives When you are aware of the different meta -theoretical assumptions:  You have an awareness that there are different ways of seeing the world.  You possess the ability to learn broad frameworks to guide your thinking and research.  You have a convenient means of categorising similar ideas, traditions and ways of thinking.  You possess a toolbox of inter -related concepts for making systematic sense of organisations. *You also know there is no one ‘correct’ perspective to use. RMIT University 8 Multiple perspectives Modernism  Ontology : objectivism -there is an objective reality independent of our knowledge of it.  Epistemology : positivism — truth is ‘discovered’ through conceptualisation/theorisation and ‘testing’ our logic against the reality found in the objective world. – Organisations are ‘real’ entities that lend themselves to our senses. RMIT University 9 Modernism Theory : Goal is to discover the ‘truths’ that govern organisations.  ‘Truths’ are seen as objective and accurate accounts of organisational properties (e.g. causal powers and laws) and the events with which ‘we’ (i.e. management) must deal when ‘we act.  Through ‘truth’ ‘we’ avoid being distracted by speculation, hunches and lies of ‘others’.  ‘Truths’ possess instrumental value (practical utility). Modernism  By knowing the ‘truth’ ‘we’ can intelligently formulate and accomplish our goals.  The instrumental and objective value of ‘truths’ for management is in assisting them to establish control over an organisation, predict outcomes and learn about one’s powers and vulnerabilities. RMIT University 10 RMIT University 11 • Truth is objective and independent of our knowing • Even if we are not there, the truth exists • Through positivist epistemology, we discover the same version of truth • All of us have equal access to the truth Depiction of Modernist Ontology Modernism Method : B ased upon statistical methods (hypothesis testing) to discover the correspondence between the hypothesis (i.e. our conceptualisation of reality) and the empirical world.

 Deductive approach: ‘test’ theory against ‘empirical reality’ RMIT University 12 RMIT University 13 Modernism General Systems Theory  Influenced by Emile Durkheim’s Structural Functionalism. • Concerned with social integration (i.e., what binds individuals and groups together?)  A system is constructed of mutually and organically interrelated specialised parts called subsystems.  The goal is to understand the ‘laws’ governing these systems and how each subsystem performs a particular activity and ‘functions’ to help reproduce the larger system.  An organisation is seen as a system comprised of four sub -systems (technology, social structure, culture and physical structure) located within a supersystem (i.e. global environment) of which it is a part. Modernism: Systems Theory Application :  To create an innovative organisation a systemic organisational environment for discovery and innovation is required:

– A particular social organisation of innovation – Interaction between departments, teams and ‘cultures’ – Expenditure on research and development – Rewards and incentives for taking risks RMIT University 14 Modernism RMIT University 15 Limitations :  Reductionist  Is your organisation nothing more than a process flow ? Does your organisational “life” look like this? RMIT University 16 Critical Theory Challenging Modernist Thought • 1940s and 1950s Modernism dominated Organisational Studies • By the 1960s Modernism was being challenged on several fronts – Empirically — as peace and stability gave way to increasing social unrest (e.g. Strikes). – Intellectually — the rise of a more ‘critical’ approach to understanding organisational life. The emergence of a ‘critical’ organisational studies:

In the US: – C.Wright Mills (1956) The Power Elite – Alvin Gouldner (1954) Patterns of Industrial Bureaucracy – (1955) Wildcat Strike In the UK: – Ralf Dahrendorf (1959) Class and Class Conflict In An Industrial Society RMIT University 17 Critical Theory Critical Theory Major influence Karl Marx (1818 -1882)  Concerned with social divisions, power, inequality and conflict within organisations and broader society.  Studied organisations through an analysis of capitalist class relations (i.e.

owner and labourer).  Capitalist mode of production characterised by exploitation and alienation of the proletariat (workers) by the bourgeoisie (owners of the means of production). RMIT University 18 Critical Theory Focus of Critical Theory • A concern with modernist claims about the possibilities of reason and knowledge. • Concern with Ideology — how distorted accounts of reality attempt to conceal and legitimate unequal power/material relations (Marx’s ‘False consciousness’). • Unmasking the ‘roots’ of domination RMIT University 19 Critical Theory Metatheoretical : • Ontology: there is an objective reality independent of our knowledge of it. It is driven by natural laws. • Epistemology: subjectivist – ‘Knowing’ the ‘truth’ is ‘tainted’ by dominant ideology and values of the those seeking ‘truth’. – ‘Nature cannot be seen as it ‘really is’ or ‘really works’ except through a value window’ Guba (1990: 24). RMIT University 20 Depiction of Critical Theory Ontology RMIT University 21 • Truth is objective and independent of our knowing • However, the truth is distorted because of our individual ideology • So even if the truth exists and is independent, we can only see different versions because of our individual ideology • Truth is discovered through subjective epistemology Indicates ideology, which distorts and influences our view of the truth • Truth is objective and independent of our knowing • However, the truth is distorted because of our individual ideology • So even if the truth exists and is independent, we can only see different versions because of our individual ideology • Truth is discovered through subjective epistemology Focus: developing the intellectual ‘tools’ to ‘unmask’ the truth. Goal: develop an appropriate political practice to address the problems. *linking knowledge and human emancipation RMIT University 22 Critical Theory Method: Qualitative  Ind uctive: a process of developing theory from observation and interpretation.  Reflexive  Historical  Discourse Analysis RMIT University 23 Critical Theory ‘Truth ’:  Capitalist organisations alienate and exploit workers.  Human emancipation requires the establishment of a more democratic and egalitarian organisation. Observation & Questions:  Why is it that organisational members submit to their own ‘exploitation’?  ‘Why do they work as hard as they do?’ Burawoy (1979) RMIT University 24 Critical Theory Position:  Organisational members have been co -opted  Organisational members have been misled Focus = Dominant Ideology ‘Unless you are willing to drench yourself in your work beyond the capacity of the average man, you are just not cut out for positions at the top’ (J.C. Penney, US retailer) ‘I do not know anyone who has gotten to the top without hard work. That is the recipe. It will not always get you to the top, but it will get you pretty near’ (Margaret Thatcher, former British PM).

‘I've always worked very, very hard, and the harder I worked, the luckier I got’ (Alan Bond, Australian businessman, convicted of fraud). RMIT University 25 Critical Theory RMIT University 26 Critical Theory:

People Don’t Know Their Own Power The Practical Implications :  A more ‘critical’ analysis of dominant organisational ideas and management practices.

‘critical theorists have shifted the image of management and the theoretical agenda ‘from saviour to problem’’ Crowther and Green (2004: 119).  Raising the consciousness of organisational members:

‘If hard work were such a wonderful thing, surely the rich would have kept it all to themselves’ Lane Kirkland, former US trade union leader  Work towards a more equal and democratic organisation. RMIT University 27 Critical Theory References • Dahrendorf, R. (1959). Class and class conflict in industrial society.

Stanford University Press. • Durkheim, E. (2014). The division of labor in society. Simon and Schuster. • Gouldner, A. W. (1954). Patterns of industrial bureaucracy. • Guba, E. G. (Ed.). (1990). The paradigm dialog. Sage Publications. • Hatch, M. J., & Cunliffe, A. L. (2012). Organization theory: modern, symbolic and postmodern perspectives . Oxford university press. • Mills, C. W. (1999). The power elite. Oxford University Press. RMIT University 28