ASQ Research Discussion - Volume 1, Number 5
ASQ Research Discussion Listserver
Volume 1, Number 5, September 15, 1995
Current subscribers: 300
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In this issue
- Moderators comment re archives
- New item: Social context of entrepreneurship (Walter W Powell)
- New item: Fuzzy constructs (Bill McKinley)
- Comments on organizational society item
- (a) Mitch Abolafia
- (b) Richard Chackerian
- Comments on age and size item
- (a) Peter Lane
- (b) Del Campbell
1. Moderators comment re archives
A few people have asked us about archives of past issues. We plan to have the issues available on a web page soon. In real terms, soon will be reasonably soon. We will post information when it is available. Brad Killaly, Will Mitchell
2. New item: Social context of entrepreneurship
"Walter W. Powell" <woodyp@u.arizona.edu
Hi! I found the discussion of size productive, so I want to see if I can generate some feedback on a problem I've run into. I need to give a lecture on entrepreneurship in my class and I'm struck by how thin the lecture on the topic is, mostly a bunch of stories about great men or arbitrage opportunities. Even the network literature, such as Ron Burt"s excellent work on structural holes, sees entrepreneurship as shaped largely by external structural opportunities.
Isn't there work out there on the social context of entrepreneurship, the social web, so to speak, that sustains risk-taking? Even work on the social origins of entrepreneurs would be useful. Maybe I'm missing something but the literature I've looked at is quite narrow. A few leads, tips would be much appreciated.
Woody Powell
Dept. of Sociology Univ. of Arizona Tucson, AZ 85721
phone: 520-621-3297
fax: 520-621-9875
3. New item: fuzzy constructs
Bill McKinley GA3964@SIUCVMB.SIU.EDU
To build on Andrew Newman's remarks in the Sept. 7 digest, it is not only age, size, and survival that are ambiguously defined constructs. In contemporary organization theory, many constructs are fuzzy, incompletely specified, and used with little consistency from one study to another. This tends to increase the scope of the constructs, allowing them to incorporate many empirical phenomena, thus making our theories richer. The downside of construct ambiguity, however, is that it makes cumulation of empirical research results very difficult (as Newman points out). In addition, construct ambiguity renders it almost impossible to disconfirm theoretical statements involving the constructs. This suggests the possibility that our discipline contains incentives against sharpening constructs and defining them rigorously. If theorists have reputations that are dependent on the credibility of their theories, there is a disincentive for the theorists to engage in actions that might expose their theories to falsification.
None of these issues are new; they have been touched on, in various ways, by Freeman (1986), Bacharach (1989), Astley and Zammuto (1992), and others. However, I believe the construct ambiguity issue is taking on increasing urgency in view of the proliferation of competing theoretical schools on the OT scene today. Many of these schools contain inconsistent assumptions and predictions, and progress toward critical tests of the competing theories seems slow. If we are to have any hope of sorting among competing theories empirically, we may need to pin down the theorists more completely than has been done thus far.
This "pinning down" process could be implemented in various ways: a) an insistence that theorists define and use specific constructs in ways that are consistent with past usage; b) the development of norms among reviewers that construct precision will be rewarded and (extreme) ambiguity will be discouraged; c) the creation of an administrative process for developing standardized, consensually based construct definitions. Of course, these suggestions fly in the face of research values that are arguably dominant in OT today: the values of uniqueness, diversity, novelty, and so on. But one wonders how long we can survive as an empirical discipline unless some attention is paid to the match between constructs and data, which inevitably involves wrestling with the construct ambiguity problem.
I would be very interested in hearing whatever thoughts others might have on these issues.
Bill McKinley
Department of Management Southern Illinois
University at Carbondale
Carbondale, IL 62901
4. Comments on organizational society item
a. Mitch Abolafia <ma038@cnsibm.albany.edu
In response to Steve Barley's thoughts on organizational society, I was surprised that Steve didn't mention Perrow's recent paper "A Society of Organizations" Theory and Society 20:725 - 762 (1991). In this paper Perrow develops the idea that organizations have absorbed the rest of society. To quote Perrow, "... the appearance of large orgnaizations in the United States makes organizations the key phenomenon of our time, and thus politics, social class, economics, technology, religion, the family, and even social psychology take on the character of dependent variables." As you might expect, the paper is extremely provocative. In additions to Perrow's work, there is a growing literature in economic sociology that looks at how organizations of one kind affect organizations of another kind and how interacting organizations shape people's lives.A compendium of some of the most interesting empirical efforts in this area is provided in Explorations in Economic Sociology, Richard Swedberg (ed.) Russell Sage Foundation, 1993. In general, I think that the most promising technique for understanding organizational society is neither network analysis nor population ecology, but rather social constructionism. We need historically informed models which show how our institutions have been constructed and how we have come to take for granted that bureacracy (rules, roles, procedures) and the market dominate our lives. Organization theorists must become better at questioning what we all assume, i.e. the exisitence of organizational arrangements.
4. Comments on organizational society item
b. Richard Chackerian, rchacker@garnet.acns.fsu.edu
I agree that there is a "hole" in the literature or perhaps more accurately an abandonment of a concern that was very real in the late 1950's and early 1960's. Robert Presthus, Peter Blau and others had "best sellers" which described the various ways in which large organizations were affecting non-work institutions. When I came to this issue in the early 1980's (Bureaucratic Power in Society) interest had moved on to more micro questions that were more subject to quantitative analysis. Katz did some very interesting work on the relationship between industrial organization and the organization of schools; family sociologists were concerned with the relationship between the structuring of the family and the evolving needs of work organizations for labor. In my own work I have conceptualized these relationships in terms of exchange and power, although if I were to go at it again the "new institutionalism" would some how have to be worked into the conceptual stew. This is perhaps a somewhat different perspective than the one you have in mind, but I think it is very much needed to deal with some of the social problems we face. The relationship between organizations and society (viz., schools, families, religions, etc.) are implicit in debates over child care, welfare reform, "family values," and health care reform. Whether these macro concerns can be made compatible with the prevailing methodological paradigms is another serious question.
Richard Chackerian
Askew School of Public Administration and Policy Florida State University
rchacker@garnet.acns.fsu.edu
5. Comment on age and size item
a. Peter Lane: LANE@uconnvm.uconn.edu
Why study firm age?
Rhonda raises an interesting question: given that managers cannot influence a firm's age, what is the value in studying its effect on firm survival or performance? One answer can be found in the managerial discretion literature. This stream of research views firm age as a proxy for the inertial weight of organizational precedents accumulated over time. Simply put, its harder to to teach an old organization new tricks. Thus while firm age may not itself be actionable, it represents an inertial constraint on other organizational factors which are actionable.
PETER J. LANE
DEPT. OF MANAGEMENT, BOX U-41M
UNIVERSITY OF CONNECTICUT
STORRS, CT 06269-2041
PHONE: (203) 429-0286
FAX: (203) 429- 7467
INTERNET: LANE@UCONNVM.UCONN.EDU
5. Comment on age and size item
b. Del Campbell <campbede@usq.edu.au
The question re age of an organisation may be a red herring in considering organisational life cycles, especially in periods of rapid and fundamental change.
As Machiavelli speculated nigh on five centuries ago in times similar to our own (he was, remember, a senior public servant of the Republic who lost his job in a change of government - to the Medicis), to cope with troubled times, one has to go back to study similar periods and look for their lessons; and the closest parallels to our own times are in the establishment and early years of English Industrial Revolution firms in the ceramics (the original industry), textile manufacture and iron and steel, and in the ways in which financial practices (esp insurance and venture capital) changed to cater for a different type of capitalism, and mass production systems.
The following remarks reflect three of my passions - strategic capability, history and 18th century English china ... the last a truly fascinating study, since it is the 18C industry which most closely parallels computing in the late 20C. The factory system (borrowed from the Chinese division of labour in the Imperial Porcelain Factory) began in the ceramics industry, especially in the production of porcelain. While other Continental states beat England both into production and in quality, it was in England that the only "Free enterprise" china production took place (The royal houses were the patrons of Continental factories), and in England that the financial and industrial infrastructure to support industrialism developed.
Besides being the first "factory system" industry, English ceramics production demanded new types of multi-disciplinary partnerships between scientists (mainly chemists) designers, potters, business managers, and new forms of power - especially steam power and endless belts to drive the press moulds. The environment was highly volatile and "Fast track", many of the factories having very short lifespans and many of the original entrepreneurs going bankrupt or being taken over - many by a single entrepreneur, Duesbury of the Derby works. Improvements and experimentation in pastes, glazes, shapes, decorations, kiln structure accounted for the high "death rate" of companies, until the import restrictions of foreign china in 1792, by which time the experimental phase was over - Spode had patented bone china, problems with pastes and glazes had been solved, enormous kiln wastages were in the past, and roads had been improved and canal transport developed, removing much of the wastage in transport.
[Within months of the ban on imported china, England was at was with France, import of fabrics, iron and steel products and other goods gave factory production in textiles and steel the impetus to dominate production ... and the rest, as they say, is history!]
One can read the histories of the English 18C china works and swear one was reading some of Kathleen Eisenhardt's investigations of Silicon Valley!
The oldest Industrial Revolution co-operation still in the hands (at least, in part) of the descendants of the original family is the Wedgewood works - the Great Innovator in all things ceramic except that for which they are now best known - porcelain (bone china). Interestingly, two other works with slightly more checkered histories - Worcester and Derby - have lost their "stand alone" status only in the last few decades.
The (incredibly well recorded) history of the early industrial revolution companies suggests that much of what we speculate about organisational lifecycles does not "wear well", especially in fast track environments. Wedgwood survived by combining innovation with early adoption with some late adoption. It successfully combined/s "classics" (jasper ware, cream/"Queens" ware, "pineapple" ware ... plates etc which looked like pineapples, cabbages ... the green cabbage plates and white cabbage services, selling as "Coalport") the paste and glazes of most which were Wedgwood's patents, with short term fads (agate ware). The costly production of china it resisted until the "bugs" were all ironed out, then dropped for fifty years until the 1880s ... producing tea and dinner services, but only very rarely figures. Nor did Wedgwood succumb to elaborate painting and gilding (except on commissioned wares), using coloured clays and well designed shapes as decoration, thereby cutting the outsourcing of wares for decoration, or the employment of expensive specialist painters, glazers and modellers (for figures).
Wedgwood's characteristics were its level of innovation in pastes and glazes, for which it held patents; its failure to be sucked into the porcelain craze; the essential simplicity of its painted decoration, confining decoration mainly to clays ad a couple of glazes; its use of new power (steam driven press moulds); clever marketing and ability to read markets; combination of expensive "up market" decorative wears with more "down market" cream wear; good management; the employment of "top of the tree" experts.
The two other long term "survivors" of the English ceramics revolution - Worcester and Derby (although both "survived" with series of different owners, and Derby was closed for a few years in the mid 19th C) - catered to the top end of the market, Worcester with magnificently decorated tableware and Derby with ditto and fine figures. Other firms were long term survivors at the bottom end. Most of these have been "swallowed" by Wedgwood and Daulton in the last few decades.
The fast track environments of the English ceramic industry between the late 1740s and the late 1790s (by which time only lead-free glazes still had to become industry norms) suggests that good management (Joshia Wedgwood, Dr Wall of Worcester, Duesbury of Derby), an ability to attune the firm closely to the market and adapt quickly to change, consistency of quality a combination of entrepreneurship and conservatism, an ability to exploit emerging technologies; the ability to work with multi-disciplinary teams of artists, scientists, financiers and managers.
Ones who failed were often under capitalised (and unable to sustain the spoilage rates), poor managers, failed to keep pace with changing fashions in the market, let quality slip, failed to survive the death or departure of one of the owners, failed to have adequate insurance (works were prone to fires or let one of the entrepreneurs like Duesbury run them off the market.
There were some "life cycle" problems, but they were often the result of the age (or illness - lead glazes took a massive toll on the mental and physical health of those in the industry) of an owner/ manager.
There are two morals to the story of English ceramics firms in the 18C: GOOD STRATEGIC MANAGEMENT PAYS!!!! APPLE/MAC WILL LOSE THE WAR TO IBM STYLE MACHINES!
Why, you ask?
Market share!!
English ceramic firms spent most of the 1745-1795 period trying to find the secret of true porcelain (which Asia and the Continent produced/s). The "next best" solution was a bone ash paste originally used at Bow (bought out by Derby). One chemist, Cooksworthy of Plymouth, eventually discovered the secret. Kiln spoilage was huge. He sold the works to Champion (Bristol) who sold it to New Hall (a fairly "down market producer) - sales which led to huge battles in the English Parliament over threats to markets because of patents. Spode's "Bone China" (almost identical to the old Bow recipe which had become an industry standard) became the market leader. Even New Hall adopted the new paste.
Bone china is creamy, not pure white, it is thicker, does not mould as well, does not take decoration as well. England dominated the world china markets in the 19 and most of the 20C.
