Gaining compliance

Organizations always involve numerous staff members whose behavior has the potential for creating significant risk for individuals and the organization but who are only loosely supervised. This situation unavoidably raises principal-agent problems. Let’s assume that the great majority of staff members are motivated by good intentions and ethical standards. That means that there are a small number of individuals whose behavior is not ethical and well intentioned. What arrangements can an organization put in place to prevent bad behavior and protect individuals and the integrity of the organization?

For certain kinds of bad behavior there are well understood institutional arrangements that work well to detect and deter the wrong actions. This is especially true for business transactions, purchasing, control of cash, expense reporting and reimbursement, and other financial processes within the organization. The audit and accounting functions within almost every sophisticated organization permit a reasonably high level of confidence in the likelihood of detection of fraud, theft, and misreporting. This doesn’t mean that corrupt financial behavior does not occur; but audits make it much more difficult to succeed in persistent dishonest behavior. So an organization with an effective audit function is likely to have a reasonably high level of compliance in the areas where standard audits can be effectively conducted.

A second kind of compliance effort has to do with the culture and practice of observer reporting of misbehavior. Compliance hotlines allow individuals who have observed (or suspected) bad behavior to report that behavior to responsible agents who are obligated to investigate these allegations. Policies that require reporting of certain kinds of bad behavior to responsible officers of the organization — sexual harassment, racial discrimination, or fraudulent actions, for example — should have the effect of revealing some kinds of misbehavior, and deterring others from engaging in bad behavior. So a culture and expectation of reporting is helpful in controlling bad behavior.

A third approach that some organizations take to compliance is to place a great deal of emphasis the moral culture of the organization — shared values, professional duty, and role responsibilities. Leaders can support and facilitate a culture of voluntary adherence to the values and policies of the organization, so that virtually all members of the organization fall in the “well-intentioned” category. The thrust off this approach is to make large efforts at eliciting voluntary good behavior. Business professor David Hess has done a substantial amount of research on these final two topics (link, link).

Each of these organizational mechanisms has some efficacy. But unfortunately they do not suffice to create an environment where we can be highly confident that serious forms of misconduct do not occur. In particular, reporting and culture are only partially efficacious when it comes to private and covert behavior like sexual assault, bullying, and discriminatory speech and behavior in the workplace. This leads to an important question: are there more intrusive mechanisms of supervision and observation that would permit organizations to discover patterns of misconduct even if they remain unreported by observers and victims? Are there better ways for an organization to ensure that no one is subject to the harmful actions of a predator or harasser?

A more active strategy for an organization committed to eliminating sexual assault is to attempt to predict the environments where inappropriate interpersonal behavior is possible and to redesign the setting so the behavior is substantially less likely. For example, a hospital may require that any physical examinations of minors must be conducted in the presence of a chaperone or other health professional. A school of music or art may require that after-hours private lessons are conducted in semi-public locations. These rules would deprive a potential predator of the seclusion needed for the bad behavior. And the practitioner who is observed violating the rule would then be suspect and subject to further investigation and disciplinary action.

Here is perhaps a farfetched idea: a “behavior audit” that is periodically performed in settings where inappropriate covert behavior is possible. Here we might imagine a process in which a random set of people are periodically selected for interview who might have been in a position to have been subject to inappropriate behavior. These individuals would then be interviewed with an eye to helping to surface possible negative or harmful experiences that they have had. This process might be carried out for groups of patients, students, athletes, performers, or auditioners in the entertainment industry. And the goal would be to uncover traces of the kinds of behavior involving sexual harassment and assault that are at the heart of recent revelations in a myriad of industries and organizations. The results of such an audit would occasionally reveal a pattern of previously unknown behavior requiring additional investigation, while the more frequent results would be negative. This process would lead to a higher level of confidence that the organization has reasonably good knowledge of the frequency and scope of bad behavior and a better system for putting in place a plan of remediation.

All of these organizational strategies serve fundamentally as attempts to solve principal-agent problems within the organization. The principals of the organization have expectations about the norms that ought to govern behavior within the organization. These mechanisms are intended to increase the likelihood that there is conformance between the principal’s expectations and the agent’s behavior. And, when they fail, several of these mechanisms are intended to make it more likely that bad behavior is identified and corrected.

(Here is an earlier post treating scientific misconduct as a principal-agent problem; link.)

Actors in historical epochs

I’ve argued often for the idea that social science and historical explanations need to be “actor-centered” — we need to ground our hypotheses about social and historical causation in theories of the pathways through which actors embody those causal processes. Actors in relation to each other constitute the “substrate” of social causation. Actors make up the microfoundations of social causes and processes. Actors constitute the causal necessity of social mechanisms.

In its abstract formulation this is little more than an expression of ontological individualism (link). But in application it represents a highly substantive research challenge. In order to provide concrete accounts of social processes in various cultural and historical settings, we need to have fairly specific theories of the actor in those settings (link): what motivates actors, what knowledge do they have of their environment, what cognitive and practical frameworks do they bring to their experiences of the world, what do they want, how do they reason, how do they relate to other actors, what norms and values are embedded in their action principles?

Rational choice theory and its cousins (desire-belief-opportunity theory, for example) provide what is intended to be a universal framework for understanding action. But as has been argued frequently here, these schemes are reductive and inadequate as a general basis for understanding action (link). It has also been argued here that the recent efforts to formulate a “new pragmatist” theory of the actor represent useful steps forward (link).

A very specific concern arises when we think carefully about the variety of actors found in diverse historical and cultural settings. It is obvious that actors in specific cultures have different belief systems and different cognitive frameworks; it is equally apparent that there are important and culture-specific differences across actors when it comes to normative and value commitments. So what is needed in order to investigate social causation in significantly different cultural and historical settings? Suppose we want to conduct research on social contention along the lines of work by Charles Tilly, with respect to communities with widely different cultural assumptions and frameworks. How should we attempt to understand basic elements of contention such as resistance, mobilization, and passivity if we accept the premise that French artisans in Paris in 1760, Vietnamese villagers in 1950, and Iranian professionals in 2018 have very substantial differences in their action principles and cognitive-practical frameworks?

There seem to be several different approaches we might take. One is to minimize the impact of cultural differences when it comes to material deprivation and oppression. Whatever else human actors want, they want material wellbeing and security. And when political or social conditions place great pressure on those goods, human actors will experience “grievance” and will have motives leading them to mobilize together in support of collective efforts to ameliorate the causes of those grievances.

Another possibility is to conclude that collective action and group behavior are substantially underdetermined by material factors, and that we should expect as much diversity in collective behavior as we observe in individual motivation and mental frameworks. So the study of contention is still about conflicts among individuals and groups; but the conflicts that motivate individuals to collective action may be ideological, religious, culinary, symbolic, moral — or material. Moreover, differences in the ways that actors frame their understandings of their situation may lead to very different patterns of the dynamics of contention — the outbreak and pace of mobilization, the resolution of conflict, the possibility of compromise.

Putting the point in terms of models and simulations, we might think of the actors as a set of cognitive and practical processing algorithms and who decide what to do based on their beliefs and these decision algorithms. It seems unavoidable that tweaking the parameters of the algorithms and beliefs will lead to very different patterns of behavior within the simulation. Putting the point the other way around, the successful mobilization of Vietnamese peasants in resistance to the French and the US depended on a particular setting of the cognitive-practical variables in these individual actors. Change those settings and, perhaps, you change the dynamics of the process and you change history.

*         *         *

Clifford Geertz is one of the people who has taken a fairly radical view on the topic of the constituents of the actor. In “Person, Time, and Conduct in Bali” in The Interpretation Of Cultures he argues that Balinese culture conceives of the individual person in radically unfamiliar ways:

One of these pervasive orientational necessities is surely the charac terization of individual human beings. Peoples everywhere have devel oped symbolic structures in terms of which persons are perceived not baldly as such, as mere unadorned members of the human race, but as representatives of certain distinct categories of persons, specific sorts of individuals. In any given case, there are inevitably a plurality of such structures. Some, for example kinship terminologies, are ego entered: that is, they denote the status of an individual in terms of his relation ship to a specific social actor. Others are centered on one or another subsystem or aspect of society and are invariant with respect to the perspectives of individual actors: noble ranks, age-group statuses, occu pational categories. Some-personal names and sobriquets-are infor mal and particularizing; others-bureaucratic titles and caste desig nations-are formal and standardizing. The everyday world in which the members of any community move, their taken-for-granted field of social action, is populated not by anonymous, faceless men with out qualities, but by somebodies, concrete classes of determinate per sons positively characterized and appropriately labeled. And the symbol systems which denote these classes are not given in the nature of things –they are historically constructed, socially maintained, and individu ally applied. (363-364)

In Bali, there are six sorts of labels which one person can apply to an other in order to identify him as a unique individual and which I want to consider against this general conceptual background: ( I ) personal names; (2) birth order names; (3) kinship terms; (4) teknonyms; (5) sta tus titles (usually called “caste names” in the literature on Bali); and (6) public titles, by which I mean quasi-occupational titles borne by chiefs, rulers, priests, and gods. These various labels are not, in most cases, employed simultaneously, but alternatively, depending upon the situa tion and sometimes the individual. They are not, also, all the sorts of such labels ever used; but they are the only ones which are generally recognized and regularly applied. And as each sort consists not of a mere collection of useful tags but of a distinct and bounded terminologi cal system, I shall refer to them as “symbolic orders of person-defini tion” and consider them first serially, only later as a more or less coher ent cluster. (368)

Also outstanding in this field is Robert Darnton’s effort to reconstruct the forms of agency underlying the “great cat massacre” in The Great Cat Massacre: And Other Episodes in French Cultural History; link.

The second American revolution

The first American Revolution broke the bonds of control exercised by a colonial power over the actions and aspirations of a relatively small number of people in North America in 1776 — about 2.5 million people. The second American Revolution promises to affect vastly larger numbers of Americans and their freedom, and it is not yet complete. (There were about 19 million African-Americans in the United States in 1960.)

This is the Civil Rights revolution, which has been underway since 1865 (the end of the Civil War); which took increased urgency in the 1930s through the 1950s (the period of Jim Crow laws and a coercive, violent form of white supremacy); and which came to fruition in the 1960s with collective action by thousands of ordinary people and the courageous, wise leadership of men and women like Dr. Martin Luther King, Jr. When we celebrate the life and legacy of MLK, it is this second American revolution that is the most important piece of his legacy.

And this is indeed a revolution. It requires a sustained and vigilant struggle against a powerful status quo; it requires gaining political power and exercising political power; and it promises to enhance the lives, dignity, and freedoms of millions of Americans.

This revolution is not complete. The assault on voting rights that we have seen in the past decade, the persistent gaps that exist in income, health, and education between white Americans and black Americans, the ever-more-blatant expressions of racist ideas at the highest level — all these unmistakeable social facts establish that the struggle for racial equality is not finished.

Dr. King’s genius was his understanding from early in his vocation that change would require courage and sacrifice, and that it would also require great political wisdom. It was Dr. King’s genius to realize that enduring social change requires changing the way that people think; it requires moral change as well as structural change. This is why Dr. King’s profoundly persuasive rhetoric was so important; he was able to express through his speeches and his teaching a set of moral values that almost all Americans could embrace. And by embracing these values they themselves changed.

The struggle in South Africa against apartheid combined both aspects of this story — anti-colonialism and anti-racism. The American civil rights movement focused on uprooting the system of racial oppression and discrimination this country had created since Reconstruction. It focused on creating the space necessary for African-American men and women, boys and girls, to engage in their own struggles for freedom and for personal growth. It insisted upon the same opportunities for black children that were enjoyed by the children of the majority population.

Will the values of racial equality and opportunity prevail? Will American democracy finally embrace and make real the values of equality, dignity, and opportunity that Dr. King expressed so eloquently? Will the second American revolution finally erase the institutions and behaviors of several centuries of oppression?

Dr. King had a fundamental optimism that was grounded in his faith: “the arc of the moral universe is long, but it bends toward justice.” But of course we understand that only long, sustained commitment to justice can bring about this arc of change. And the forces of reaction are particularly strong in the current epoch of political struggle. So it will require the courage and persistence of millions of Americans to these ideals if racial justice is finally to prevail.

Here is an impromptu example of King’s passionate commitment to social change through non-violence. This was recorded in Yazoo City, Mississippi in 1966, during James Meredith’s March against Fear.

Populism’s base

Steve Bannon may have lost his perch in the White House and Breitbart; but the themes of white supremacy, intolerance, bigotry, and anti-government extremism that drive radical nationalist populism survive his fall. In The New Minority: White Working Class Politics in an Age of Immigration and Inequality Justin Gest attempts to explain how this movement has been able to draw support from white working class men and women — often in support of policies that are objectively harmful to them. Here is how he describes his central concern:

In this book, I suggest that these trends [towards polarization] intensify an underlying demographic phenomenon: the communities of white working class people who once occupied the political middle have decreased in size and moved to the fringes, and American and European societies are scrambling to recalibrate how they might rebuild the centrist coalitions that engender progress.

The book makes use of both ethnographic and survey research to attempt to understand the political psychology of these populations of men and women in Western Europe and the United States — low-skilled workers with limited education beyond secondary school, and with shrinking opportunities in the economies of the 2000s.

A particularly interesting feature of the book is the ethnographic attempt Gest makes to understand the mechanisms and content of this migration of political identity. Gest conducted open-ended interviews with working class men and women in East London and Youngstown, Ohio in the United States — both cities that were devastated by the loss of industrial jobs and the weakening of the social safety net in the 1970s and 1980s. He calls these “post-traumatic cities” (7). He addresses the fact that white working class people in those cities and elsewhere now portray themselves as a disadvantaged minority.

There and elsewhere, the white working class populations I consider are consumed by a nostalgia that expresses bitter resentment toward the big companies that abandoned their city, a government that did little to stop them from leaving, and a growing share of visible minorities who are altering their neighborhoods’ complexion. (10)

The political psychology of resentment plays a large role in the populations he studies — resentment of government that fails to deliver, resentment of immigrants, resentment of affirmative action for racial minorities. The other large idea that Gest turns to is marginality — the idea that these groups have that their voices will not be heard and that the powerful agents in society do not care about their fates.

Rather, this is to say that—across the postindustrial regions of Western Europe and North America—white working class people sense that they have been demoted from the center of their country’s consciousness to its fringe. And many feel powerless in their attempts to do something about it. (15)

And resentment and marginality lead for some individuals to a political stance of resistance:

Unimpressed with Labour’s priorities, profoundly distrustful of government, and unwilling to join forces with working class immigrants, Barking and Dagenham’s working class whites are now engaged in a largely unstructured, alternative form of minority politics. They tend to be focused on local affairs, fighting for scarce public resources and wary of institutionalized discrimination against them. The difficulty has been having their claims heard, and taken seriously. (71)

The resentments and expressions of marginality in Youngstown are similar, with an added measure of mistrust of large corporations like the steel companies that abandoned the city and a recognition of the pervasive corruption that permeates the city. Here is Evelyn on the everyday realities of political corruption in Youngstown:

The more I saw, the more I realized that money can buy your way out of anything. Then you see your sheriff get indicted, your congressman dishonored, our prosecutor in prison, and a mayoral nominee with a cloud over his head. The Valley has been embroiled in political corruption for a long time, and people just look out for themselves. It makes you sick. You don’t see it firsthand, the corruption, but you know it’s there. (128)

The overriding impression gained from these interviews and Gest’s narrative is one of hopelessness. These men and women of Youngstown don’t seem to see any way out for themselves or their children. The pathway of upward mobility through post-secondary education does not come up at all in these conversations. And, as Case and Deaton argue from US mortality statistics (link), social despair is associated with life-ending behaviors such as opioids, alcohol abuse, and suicide.

Gest’s book lays the ground for thinking about a post-traumatic democratic politics — a politics that is capable of drawing together the segments of American or British society who genuinely need progressive change and more egalitarian policies if they are to benefit from economic progress in the future. But given the cultural and political realities that Gest identifies among this “new minority”, it is hard to avoid the conclusion that crafting such a political platform will be challenging.

Trust and organizational effectiveness

It is fairly well agreed that organizations require a degree of trust among the participants in order for the organization to function at all. But what does this mean? How much trust is needed? How is trust cultivated among participants? And what are the mechanisms through which trust enhances organizational effectiveness?

The minimal requirements of cooperation presuppose a certain level of trust. As A plans and undertakes a sequence of actions designed to bring about Y, his or her efforts must rely upon the coordination promised by other actors. If A does not have a sufficiently high level of confidence in B’s assurances and compliance, then he will be rationally compelled to choose another series of actions. If Larry Bird didn’t have trust in his teammate Dennis Johnson, the famous steal would not have happened.

 

First, what do we mean by trust in the current context? Each actor in an organization or group has intentions, engages in behavior, and communicates with other actors. Part of communication is often in the form of sharing information and agreeing upon a plan of coordinated action. Agreeing upon a plan in turn often requires statements and commitments from various actors about the future actions they will take. Trust is the circumstance that permits others to rely upon those statements and commitments. We might say, then, that A trusts B just in case —

  • A believes that when B asserts P, this is an honest expression of B’s beliefs.
  • A believes that when B says he/she will do X, this is an honest commitment on B’s part and B will carry it out (absent extraordinary reasons to the contrary).
  • A believes that when B asserts that his/her actions will be guided by his best understanding of the purposes and goals of the organization, this is a truthful expression.
  • A believes that B’s future actions, observed and unobserved, will be consistent with his/her avowals of intentions, values, and commitments.

So what are some reasons why mistrust might rear its ugly head between actors in an organization? Why might A fail to trust B?

  • A may believe that B’s private interests are driving B’s actions (rather than adherence to prior commitments and values).
  • A may believe that B suffers from weakness of the will, an inability to carry out his honest intentions.
  • A may believe that B manipulates his statements of fact to suit his private interests.
  • Or less dramatically: A may not have high confidence in these features of B’s behavior.
  • B may have no real interest or intention in behaving in a truthful way.

And what features of organizational life and practice might be expected to either enhance inter-personal trust or to undermine it?

Trust is enhanced by individuals having the opportunity to get acquainted with their collaborators in a more personal way — to see from non-organizational contexts that they are generally well intentioned; that they make serious efforts to live up to their stated intentions and commitments; and that they are generally honest. So perhaps there is a rationale for the bonding exercises that many companies undertake for their workers.

Likewise, trust is enhanced by the presence of a shared and practiced commitment to the value of trustworthiness. An organization itself can enhance trust in its participants by performing the actions that its participants expect the organization to perform. For example, an organization that abruptly and without consultation ends an important employee benefit undermines trust in the employees that the organization has their best interests at heart. This abrogation of prior obligations may in turn lead individuals to behave in a less trustworthy way, and lead others to have lower levels of trust in each other.

How does enhancing trust have the promise of bringing about higher levels of organizational effectiveness? Fundamentally this comes down to the question of the value of teamwork and the burden of unnecessary transaction costs. If every expense report requires investigation, the amount of resources spent on accountants will be much greater than a situation where only the outlying reports are questioned. If each vice president needs to defend him or herself against the possibility that another vice president is conspiring against him, then less time and energy are available to do the work of the organization. If the CEO doesn’t have high confidence that her executive team will work wholeheartedly to bring about a successful implementation of a risky investment, then the CEO will choose less risky investments.

In other words, trust is crucial for collaboration and teamwork. And organizations that manage to help to cultivate a high level of trust among its participants is likely to perform better than one that depends primarily on supervision and enforcement.

Is history probabilistic?

Many of our intuitions about causality are driven by a background assumption of determinism: one cause, one effect, always. But it is evident in many realms — including especially the social world — that causation is probabilistic. A cause makes its effects more likely than they would be in the absence of the cause. Exposure to a Zika-infected mosquito makes it more likely that the individual will acquire the illness; but many people exposed to Zika mosquitoes do not develop the illness. Wesley Salmon formulated this idea in terms of the concept of causal relevance: C is causally relevant to O just in case the conditional probability of O given C is different from the probability of O. (Some causes reduce the probability of their outcomes.)

There is much more to say about this model — chiefly the point that causes rarely exercise their powers in isolation from other factors. So, as J.L. Mackie worked out in The Cement of the Universe: A Study of Causation, we need to be looking for conjunctions of factors that jointly affect the probability of the occurrence of O. Causation is generally conjunctural. But the essential fact remains: no matter how many additional factors we add to the analysis, we are still unlikely to arrive at deterministic causal statements: “whenever ABCDE occurs, O always occurs.”

But here is another kind of certainty that also arises in a probabilistic world. When sequences are governed by objective probabilities, we are uncertain about any single outcome. But we can be highly confident that a long series of trials will converge around the underlying probability. In an extended series of throws of a fair pair of dice the frequency of throwing a 7 will converge around 6/36, whereas the frequency of throwing a 12 will converge around 1/36. So we can be confident that the eventual set of outcomes will look like the histogram above.

Can we look at history as a vast series of stochastic events linked by relations of probabilistic causation? And does this permit us to make historical predictions after all?

Let’s explore that idea. Imagine that history is entirely the product of a set of stochastic events connected with each other by fixed objective probabilities. And suppose we are interested in a particular kind of historical outcome — say the emergence of central states involving dictatorship and democracy. We might represent this situation as a multi-level process of social-political complexification — a kind of primordial soup of political development by opportunistic agents within a connected population in a spatial region. Suppose we postulate a simple political theory of competition and cooperation driving patterns of alliance formation, institution formation, and the aggregation of power by emerging institutions. (This sounds somewhat similar to Tilly’s theory of state formation in Coercion, Capital and European States, A.D. 990 – 1992 and to Michael Mann’s treatment of civilizations in The Sources of Social Power: Volume 1, A History of Power from the Beginning to AD 1760.)

Finally we need to introduce some kind of mechanism of invention — of technologies, institutions, and values systems. This is roughly analogous to the mechanism of genetic mutation in the evolution of life.

Now we are ready to ask some large historical questions about state formation in numerous settings. What is the likelihood of the emergence of a stable system of self-governing communities? What is the likelihood that a given population will arrive at a group of inventions involving technology, institutions, and values systems that permit the emergence of central state capable of imposing its will over distance, collecting revenues to support its activities, and conducting warfare? And what is the likelihood of local failure, resulting in the extinction of the local population? We might look at the historical emergence of various political-economic forms such as plunder societies (Genghis Khan), varieties of feudalism, and medieval city states as different outcomes resulting from the throw of the dice in these different settings.

Self-governance seems like a fairly unlikely outcome within this set of assumptions. Empire and dictatorship seem like the more probable outcomes of the interplay of self-interest, power, and institutions. In order to get self-governance out of processes like these we need to identify a mechanism through which collective action by subordinate agents is possible. Such mechanisms are indeed familiar — the pressures by subordinate but powerful actors in England leading to the reform of absolutist monarchy, the overthrow of the French monarchy by revolutionary uprisings, the challenges to the Chinese emperor represented by a series of major rebellions in the nineteenth century. But such counter-hegemonic processes are often failures, and even when successful they are often coopted by powerful insiders. These possibilities lead us to estimate a low likelihood of stable self-governance.

So this line of thought suggests that a stochastic model of the emergence of central states is possible but discouraging. Assign probabilities to the various kinds of events that need to occur at each of the several stages of civilizational development; run the model a large number of times; and you have a Monte Carlo model of the emergence of dictatorship and democracy. And the discouraging likelihood is that democratic self-governance is a rare outcome.

However, there are several crucial flaws in this analysis. First, the picture is flawed by the fact that history is made by purposive agents, not algorithms or mechanical devices. These actors are not characterized by fixed objective probabilities. Historical actors have preferences and take actions to influence outcomes at crucial points. Second, agents are not fixed over time, but rather develop through learning. They are complex adaptive agents. They achieve innovations in their practices just as the engineers and bureaucrats do. They develop and refine repertoires of resistance (Tilly). So each play of the game of political history is novel in important respects. History is itself influenced by previous history.

Finally, there is the familiar shortcoming of simulations everywhere: a model along these lines unavoidably requires making simplifying assumptions about the causal factors in play. And these simplifications can be shown to have important consequences for the sensitivity of the model.

So it is important to understand that social causation is generally probabilistic; but this fact does not permit us to assign objective probabilities to the emergence of central states, dictatorships, or democracies.

(See earlier posts on more successful efforts to use Bayesian methods to assess the likelihood of the emergence of specific outcomes in constrained historical settings;
link, link.)

The culture of an organization

It is often held that the behavior of a particular organization is affected by its culture. Two banks may have very similar organizational structures but show rather different patterns of behavior, and those differences are ascribed to differences in culture. What does this mean? Clifford Geertz is one of the most articulate theorists of culture — especially in his earlier works. Here is a statement couched in terms of religion as a cultural system from The Interpretation Of Cultures. A religion is …

(1) a system of symbols which act to (2) establish powerful, pervasive, and long-lasting moods and motivations in men by (3) formulating conceptions of a general order of existence and (4) clothing these conceptions with such an aura of factuality that (5) the moods and motivations seem uniquely realistic. (90)

And again:

The concept of culture I espouse, and whose utility the essays below attempt to demonstrate, is essentially a semiotic one. Believing, with Max Weber, that man is an animal suspended in webs of significance he himself has spun, I take culture to be those webs, and the analysis of it to be therefore not an experimental science in search of law but an interpretive one in search of meaning. (5)

On its face this idea seems fairly simple. We might stipulate that “culture” refers to a set of beliefs, values, and practices that are shared by a number of individuals within the group, including leaders, managers, and staff members. But, as we have seen repeatedly in other posts, we need to think of these statements in terms of a distribution across a population rather than as a uniform set of values.

Consider this hypothetical comparison of two organizations with respect to employees’ attitudes towards working with colleagues of a different religion. (This example is fictitious.) Suppose that the employees of two organizations have been surveyed on the topic of their comfort level at working with other people of different religious beliefs, on a scale of 0-21. Low values indicate a lower level of comfort.

The blue organization shows a distribution of individuals who are on average more accepting of religious diversity than the gold organization. The weighted score for the blue population is about 10.4, in comparison to a weighted score of 9.9 for the gold population. This is a relatively small difference between the two populations; but it may be enough to generate meaningful differences in behavior and performance. If, for example, the attitude measured here leads to an increased likelihood for individuals to make disparaging comments about the co-worker’s religion, then we might predict that the gold group will have a somewhat higher level of incidents of religious intolerance. And if we further hypothesize that a disparaging work environment has some effect on work productivity, then we might predict that the blue group will have somewhat higher productivity.

Current discussions of sexual harassment in the workplace are often couched in terms of organizational culture. It appears that sexual harassment is more frequent and flagrant in some organizations than others. Women are particularly likely to be harassed in a work culture in which men believe and act as though they are at liberty to impose sexual language and action on female co-workers and in which the formal processes of reporting of harassment are weak or disregarded. The first is a cultural fact and the second is a structural or institutional fact.

We can ask several causal questions about this interpretation of organizational culture. What are the factors that lead to the establishment and currency of a given profile of beliefs, values, and practices within an organization? And what factors exist that either reproduce those beliefs or undermine them? Finally we can ask what the consequences of a given culture profile are in the internal and external performance of the organization.

There seem to be two large causal mechanisms responsible for establishment and maintenance of a particular cultural constellation within an organization. First is recruitment. One organization may make a specific effort to screen candidates so as to select in favor of a particular set of values and attitudes — acceptance, collaboration, trustworthiness, openness to others. And another may favor attitudes and values that are thought to be more directly related to profitability or employee malleability. These selection mechanisms can lead to significant differences in the overall culture of the organization. And the decision to orient recruitment in one way rather than another is itself an expression of values.

The second large mechanism is the internal socialization and leadership processes of the organization. We can hypothesize that an organization whose leaders and supervisors both articulate the values of equality and respect in the workplace and who demonstrate that commitment in their own actions will be one in which more people in the organization will adopt those values. And we can likewise hypothesize that the training and evaluation processes of an organization can be effective in cultivating the values of the organization. In other words, it seems evident that leadership and training are particularly relevant to the establishment of a particular organizational culture.

The other large causal question is how and to what extent cultural differences across organizations have effects on the performance and behavior of those organizations. We can hypothesize that differences in organizational values and culture lead to differences in behavior within the organization — more or less collaboration, more or less harassment, more or less bad behavior of various kinds. These differences are themselves highly important. But we can also hypothesize that differences like these can lead to differences in organizational effectiveness. This is the central idea of the field of positive organizational studies. Scholars like Kim Cameron and others argue, on the basis of empirical studies across organizational settings, that organizations that embody the values of mutual acceptance, equality, and a positive orientation towards each others’ contributions are in fact more productive organizations as well (Competing Values Leadership: Second Edition; link).

Is public opinion part of a complex system?

The worrisome likelihood that Russians and other malevolent actors are tinkering with public opinion in Western Europe and the United States through social media creates various kinds of anxiety. Are our democratic values so fragile that a few thousand Facebook or Twitter memes could put us on a different plane about important questions like anti-Muslim bigotry, racism, intolerance, or fanaticism about guns? Can a butterfly in Minsk create a thunderstorm of racism in Cincinnati? Have white supremacy and British ultra-nationalism gone viral?

There is an interesting analogy here with the weather. The weather next Wednesday is the net consequence of a number of processes and variables, none of which are enormously difficult to analyze. But in their complex interactions they create outcomes that are all but impossible to forecast over a period of more than three days. And this suggests the interesting idea that perhaps public opinion is itself the result of complex and chaotic processes that give rise to striking forms of non-linear change over time.

Can we do a better job of understanding the dynamics of public opinion by making use of the tools of complexity theory? Here is a summary description of complex systems provided by John Holland in Complexity: A Very Short Introduction:

Complexity, once an ordinary noun describing objects with many interconnected parts, now designates a scientific field with many branches. A tropical rainforest provides a prime example of a complex system. The rainforest contains an almost endless variety of species—one can walk a hundred paces without seeing the same species of tree twice, and a single tree may host over a thousand distinct species of insects. The interactions between these species range from extreme generalists (‘ army’ ants will consume most anything living in their path) to extreme specialists (Darwin’s ‘comet orchid’, with a foot-long nectar tube, can only be pollinated by a particular moth with a foot-long proboscis—neither would survive without the other). Adaptation in rainforests is an ongoing, relatively rapid process, continually yielding new interactions and new species (orchids, closely studied by Darwin, are the world’s most rapidly evolving plant form). This lush, persistent variety is almost paradoxical because tropical rainforests develop on the poorest of soils—the rains quickly leach all nutrients into the nearest creek. What makes such variety possible? (1)

Let’s consider briefly how public opinion might fit into the framework of complexity theory. On the positive side, public opinion has some of the dynamic characteristics of systems that are often treated as being complex: non-linearity, inflection points, critical mass. Like a disease, a feature of public opinion can suddenly “go viral” — reproduce many times more rapidly than in previous periods. And the collective phenomenon of public opinion has a feature of “self-causation” that finds parallels in other kinds of systems — a sudden increase in the currency of a certain attitude or belief can itself accelerate the proliferation of the belief more broadly.

On the negative side, the causal inputs to public opinion dynamics do not appear to be particularly “complex” — word-of-mouth, traditional media, local influencers, and the new factor of social media networks like Twitter, Weibo, or Facebook. We might conceptualize a given individual’s opinion formation as the net result of information and influence received through these different kinds of inputs, along with some kind of internal cognitive processing. And the population’s “opinions” are no more than the sum of the opinions of the various individuals.

Most fundamentally — what are the “system” characteristics that are relevant to the dynamics of public opinion in a modern society? How does public opinion derive from a system of individuals and communication pathways?

This isn’t a particularly esoteric question. We can define public opinion at the statistical aggregate of the distribution of beliefs and attitudes throughout a population — recognizing that there is a distribution of opinion around every topic. For example, at present public opinion in the United States on the topic of President Trump is fairly negative, with a record low 35% approval rating. And the Pew Research Center finds that US public opinion sees racism as an increasingly important problem (link):

Complexity theorists like Scott Page and John Holland focus much attention on a particular subset of complex systems, complex adaptive systems (CAS). These are systems in which the agents are themselves subject to change. And significantly, public opinion in a population of human agents is precisely such a system. The agents change their opinions and attitudes as a result of interaction with other agents through the kinds of mechanisms mentioned here. If we were to model public opinion as a “pandemonium” process, then the possibility of abrupt non-linearities in a population becomes apparent. Assume a belief-transmission process in which individuals transmit beliefs to others with a volume proportional to their own adherence to the belief and the volume and number of other agents from whom they have heard the belief, and individuals adopt a belief in proportion to the number and volume of voices they hear that are espousing the belief. Contagion is no longer a linear relationship (exposure to an infected individual results in X probability of infection), but rather a non-linear process in which the previous cycle’s increase leads to amplified infection rate in the next round.

Here is a good review article of the idea of a complex system and complexity science by Ladyman, Lambert and Wiesner (linklink). Here is a careful study of the diffusion of “fake news” by bots on Twitter (link, link). (The graphic at the top is taken from this article.) And here is a Ph.D. dissertation on modeling public opinion by Emily Cody (link).

Varieties of organizational dysfunction

Several earlier posts have made the point that important technology failures often include organizational faults in their causal background.

It is certainly true that most important accidents have multiple causes, and it is crucial to have as good an understanding as possible of the range of causal pathways that have led to air crashes, chemical plant explosions, or drug contamination incidents. But in the background we almost always find organizations and practices through which complex technical activities are designed, implemented, and regulated. Human actors, organized into patterns of cooperation, collaboration, competition, and command, are as crucial to technical processes as are power lines, cooling towers, and control systems in computers. So it is imperative that we follow the lead of researchers like Charles Perrow (The Next Catastrophe: Reducing Our Vulnerabilities to Natural, Industrial, and Terrorist Disasters), Kathleen Tierney (The Social Roots of Risk: Producing Disasters, Promoting Resilience), or Diane Vaughan (The Challenger Launch Decision: Risky Technology, Culture, and Deviance at NASA) and give close attention to the social- and organization-level failures that sometimes lead to massive technological failures.

It is useful to have a few examples in mind as we undertake to probe this question more deeply. Here are a number of important accidents and failures that have been carefully studied.

  • Three Mile Island, Chernobyl nuclear disasters
  • Challenger and Columbia space shuttle disasters
  • Failure of United States anti-submarine warfare in 1942-43
  • Flawed policy and decision-making in US leading to escalation of Vietnam War
  • Flawed policy and decision-making in France leading to Dien Bien Phu defeat
  • Failure of Nuclear Regulatory Commission to ensure reactor safety
  • DC-10 design process
  • Osprey design process
  • failure of Federal flood insurance to appropriately guide rational land use
  • FEMA failure in Katrina aftermath
  • Design and manufacture of the Edsel sedan
  • High rates of hospital-born infections in some hospitals

Examples like these allow us to begin to create an inventory of organizational flaws that sometimes lead to failures and accidents:

  • siloed decision-making (design division, marketing division, manufacturing division all have different priorities and interests)
  • lax implementation of formal processes
  • strategic bureaucratic manipulation of outcomes 
    • information withholding, lying
    • corrupt practices, conflicts of interest and commitment
  • short-term calculation of costs and benefits
  • indifference to public goods
  • poor evaluation of data; misinterpretation of data
  • lack of high-level officials responsible for compliance and safety

These deficiencies may be analyzed in terms of a more abstract list of organizational failures:

  • Poor decisions given existing priorities and facts
    • poor priority-setting processes
    • poor information-gathering and analysis
  • failure to learn and adapt from changing circumstances
  • internal capture of decision-making; corruption, conflict of interest
  • vulnerability of decision-making to external pressures (external capture)
  • faulty or ineffective implementation of policies, procedures, and regulations
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Nancy Leveson is a leading authority on the systems-level causes of accidents and failures. A recent white paper can be found here. Here is the abstract for that paper:

New technology is making fundamental changes in the etiology of accidents and is creating a need for changes in the explanatory mechanisms used. We need better and less subjective understanding of why accidents occur and how to prevent future ones. The most effective models will go beyond assigning blame and instead help engineers to learn as much as possible about all the factors involved, including those related to social and organizational structures. This paper presents a new accident model founded on basic systems theory concepts. The use of such a model provides a theoretical foundation for the introduction of unique new types of accident analysis, hazard analysis, accident prevention strategies including new approaches to designing for safety, risk assessment techniques, and approaches to designing performance monitoring and safety metrics. (1; italics added)

Here is what Leveson has to say about the social and organizational causes of accidents:

2.1 Social and Organizational Factors

Event-based models are poor at representing systemic accident factors such as structural deficiencies in the organization, management deficiencies, and flaws in the safety culture of the company or industry. An accident model should encourage a broad view of accident mechanisms that expands the investigation from beyond the proximate events.

Ralph Miles Jr., in describing the basic concepts of systems theory, noted that:

Underlying every technology is at least one basic science, although the technology may be well developed long before the science emerges. Overlying every technical or civil system is a social system that provides purpose, goals, and decision criteria (Miles, 1973, p. 1).

Effectively preventing accidents in complex systems requires using accident models that include that social system as well as the technology and its underlying science. Without understanding the purpose, goals, and decision criteria used to construct and operate systems, it is not possible to completely understand and most effectively prevent accidents. (6)

Organizational dysfunction

What is a dysfunction when it comes to the normal workings of an organization? In order to identify dysfunctions we need to have a prior conception of the “purpose” or “agreed upon goals” of an organization. Fiscal agencies collect taxes; child protection services work to ensure that foster children are placed in safe and nurturing environments; air travel safety regulators ensure that aircraft and air fields meet high standards of maintenance and operations; drug manufacturers produce safe, high-quality medications at a reasonable cost. A dysfunction might be defined as an outcome for an organization or institution that runs significantly contrary to the purpose of the organization. We can think of major failures in each of these examples.

But we need to make a distinction between failure and dysfunction. The latter concept is systemic, having to do with the design and culture of the organization. Failure can happen as a result of dysfunctional arrangements; but it can happen as a result of other kinds of factors as well. For example, the Tylenol crisis of 1982 resulted from malicious tampering by an external third party, not organizational dysfunction.

Here is an example from a Harvard Business Review article by Gill Corkindale indicating some of the kinds of dysfunction that can be identified in contemporary business organizations:

Poor organizational design and structure results in a bewildering morass of contradictions: confusion within roles, a lack of co-ordination among functions, failure to share ideas, and slow decision-making bring managers unnecessary complexity, stress, and conflict. Often those at the top of an organization are oblivious to these problems or, worse, pass them off as or challenges to overcome or opportunities to develop. (link)

And the result of failures like these is often poor performance and sometimes serious crisis for the organization or its stakeholders.

But — as in software development — it is sometimes difficult to distinguish between a feature and a bug. What is dysfunctional for the public may indeed be beneficial for other actors who are in a position to influence the design and workings of the organization. This is the key finding of researchers like Jack Knight, who argues in Institutions and Social Conflict for the prevalence of conflicting interests in the design and operations of many institutions and organizations; link. And it follows immediately from the approach to organizations encapsulated in the Fligstein and McAdam theory of strategic action fields (link).

There is an important related question to consider: why do recognized dysfunctional characteristics persist? When a piano is out of tune, the pianist and the audience insist on a professional tuning. When the Nuclear Regulatory Commission persistently fails to enforce its regulations through rigorous inspection protocols, nothing happens (Union of Concerned Scientists, link; Perrow, link). Is it that the individuals responsible for the day-to-day functioning of the organization are complacent or unmotivated? Is it that there are contrary pressures that arise to oppose corrective action? Or, sometimes, is it that the adjustments needed to correct one set of dysfunctions can be expected to create another, even more harmful, set of bad outcomes?

One intriguing hypothesis is that correction of dysfunctions requires observation, diagnosis, and incentive alignment. It is necessary that some influential actor or group should be able to observe the failure; it should be possible to trace the connection between the failure and the organizational features that lead to it; and there should be some way of aligning the incentives of the powerful actors within and around the organization so that their best interests are served by their taking the steps necessary to correct the dysfunction. If any of these steps is blocked, then a dysfunctional organization can persist indefinitely.

The failures of Soviet agriculture were observable and the links between organization and farm inefficiency were palpable; but the Soviet public had not real leverage with respect to the ministries and officials who ran the agricultural system. Therefore Soviet officials had no urgent incentive to reform agriculture. So the dysfunctions of collective farming were not corrected until the collapse of the USSR. A dysfunction in a corporation within a market economy that significantly impacts its revenues and profits will be noticed by shareholders, and pressure will be exerted to correct the dysfunction. The public has a strong interest in nuclear reactor safety; but its interests are weak and diffused when compared to the interests of the industry and its lobbyists; so Congressional opposition to reform of the agency remains strong. The same could be said with respect to the current crisis at the Consumer Financial Protection Bureau; the influence of the financial industry and its lobbyists can be concentrated in a way that the interests of the public cannot.

Charles Perrow has written extensively on the failures of the US regulatory sector (link). Here is his description of regulatory capture in the nuclear power industry:

Nuclear safety is problematic when nuclear plants are in private hands because private firms have the incentive and, often, the political and economic power to resist effective regulation. That resistance often results in regulators being captured in some way by the industry. In Japan and India, for example, the regulatory function concerned with safety is subservient to the ministry concerned with promoting nuclear power and, therefore, is not independent. The United States had a similar problem that was partially corrected in 1975 by putting nuclear safety into the hands of an independent agency, the Nuclear Regulatory Commission (NRC), and leaving the promotion of nuclear power in the hands of the Energy Department. Japan is now considering such a separation. It should make one. Since the accident at Fukushima, many observers have charged that there is a revolving door between industry and the nuclear regulatory agency in Japan — what the New York Times called a “nuclear power village” — compromising the regulatory function. (link)

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