Managing local practices in global contexts
Managing local practices in global contexts

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Managing local practices in global contexts

5 Postmodern rationalities

5.1 Decision making

Decision making is understood as management's main task. Usually, the model of decision making is described as a perfectly well-organised, rational and logical process. First, the problem is defined. Second, all the relevant information that leads to an optimal solution is collected. Third, reviewing the data, management (perhaps with the help of technocratic ‘experts’) develops several possible solutions. Fourth, evaluating the possible solutions carefully, management makes a decision regarding the optimal solution. Fifth, this solution is implemented in a top-down approach that is evaluated constantly by management. Such constant processes of rational decision making, supported by the latest ICT equipment and an army of analysts and consultants, are meant constantly and incrementally to refine and improve an organisation's processes and products. The problem of recalcitrant hands is solved by turning them into disciplined and reflexive extensions of the corporate body, able to exercise discretion, but in corporately prescribed ways.

Although still in powerful circulation in today's organisations, the model of managerial decision making outlined above has been challenged by various contributions to management and organisation theory. James March and Herbert Simon (1958) doubted whether decision makers really look for optimal solutions. They suggested that they look for ‘satisficing’ solutions. Because of the limited capacity of human information processing, no one could really consider all solutions and then decide which one was the best one – not even a top manager. But top managers, because of their wide experiences, have a raft of comparable cases to draw on for most decision situations, and on the basis of that limited search are able to be rational within the bounds of their own experiences. However, having more experience, these bounds are less constraining than would be the case were lower-order members to do the deciding. In organisational life, a careful analysis of all available information would be impossibly time-consuming given that time (and motivation for such use of time) is a scare resource: it is for this reason that satisfactory rather than optimal decisions will be made. Simon and March saw people as having ‘bounded rationality’. By this they meant to establish a distinction from the conception of economic rationalism that was inherent in the orthodox views of economics. The economic view of rationality assumed that a person would make rational decisions on the basis of perfect knowledge about the nature of the phenomenon in question. This perfect knowledge would be contained in what economists call ‘price signals’, because all that one would need to know about broadly similar goods in perfectly competitive markets is how much they cost. A rational person would always buy the cheapest product, all other things being constant. This would be the optimal decision. But, in complex organisations, Simon and March argued, decision makers work under constraints that make optimal decisions impossible. They have imperfect knowledge: there is insufficient time to collect all the data they need. Their information-processing capacities are subject to cognitive limitations: they are not sure what they need to know, and so on. The result is that rationality is ‘bounded’ and decision makers cannot optimise but must ‘satisfice’ – make the best decisions that they can: those that are most satisfactory as it seems at the time, based on the available information.

A group of French philosophers and writers, who have been labelled as postmodernists, have shown that our taken-for-granted concept of rationality is in fact just one approach to the rational, and that there are many other forms of rationality beneath the smooth surface of textbook knowledge and scientific jargon. One of the most influential of these, Michel Foucault (1979), thought that what we took to be rational was always an effect of the historically constituted ways of making truth claims that had become accepted as normal in a given society or locale, such as a profession or organisation. For instance, it was a truth of nineteenth-century medicine that the womb was the seat of female neurosis, hence the operation for its removal became known as a hysterectomy. Organisationally, whole apparatuses of nurses and medical staff were dedicated to the removal of wombs based on the certainty of medical knowledge whose truth no one accedes to today. In management more generally it was once a widely held truth claim that employees were paid to do exactly as they were told and for them not to deviate from prescribed practice; indeed, this was a cornerstone of Taylor's philosophy of scientific management.

How do organisations, professions and practitioners perpetuate these truth claims and sustain the practices associated with them? One way is through the circulation of stories. For instance, Jean-Francois Lyotard (1984) emphasised that we make sense of the world through the use of narratives. However, as Lyotard argues, relying on one dominant story can lead us to forget or actively repress other potential narratives. The account of a visit to the Jenolan Caves in Box 5 illustrates this point.

Box 5: Making sense of the Jenolan Caves

Being interested in the history of the caves, a European visitor to Australia's Jenolan Caves in the Blue Mountains near Sydney joined a guided tour. What he heard in the scientific treatise that followed in the next two hours was hardly exciting: the guide started a monologue on stalagmites and how they are formed over many million years – how earth movements over the last couple of million years, and micro-organisms kept hidden deep inside the waterholes in the cave, and so forth, made them possible. With Lyotard, this becomes understandable: what the guide did (and what probably most visitors expect from a guide) was to use the scientific template to make sense of what one can see in the caves. Viewed through a scientific lens, the caves started to resemble a laboratory, a showcase of how much the guide knew; but as a result a whole other reality was buried. The guide could also have told stories about indigenous people and the meaning of the cave for them, about the changes of use of the cave over the years, about the tragedies witnessed and comedies hosted over the centuries; about the local people and how they used the caves; about myths, secrets and stories that evolved around the cave. In short, the guide could have told many different stories about the cave, and the scientific story would have been just one. All these stories enact different rationalities, none per se is superior to the other, but through the domination of one story – the story of science – all the other stories become subordinated.

Rationality is shaped by the local interpretation of prevailing institutional rules of practice. Insider judgements about the extent to which something is ‘right’ or ‘wrong’ are reflexively automatic: they rely on tacit integrations of subsidiary information ‘clues’ that reflect taken-for-granted expectations about what should, or should not, happen. In the same way that we can recognise our friend's face without being able to explain how we do this, insiders can recognise appropriate practice without being able to say what it is that they are recognising. Moreover, we can ‘see’, in an instant, when somebody does something questionable or an outsider fails to comply with our insider expectations.

Practices that survive in an organisation are not necessarily efficient, nor are they, in any objective sense, ‘right’ or ‘wrong': they survive because they are embedded in the institutional fabric; they reflect ‘the way that things are done around here’. As we saw in Section 1.1, practices such as slavery and cannibalism were embedded in the prevailing social norms of Robinson Crusoe and Friday's respective societies: they were seen as legitimate by the standards of the time. Although there are obvious examples of accepted norms evolving over time (as the examples of slavery and cannibalism illustrate), many aspects of practice are embedded in ways that might not be clear to outside observers. Japanese and Chinese business etiquette, for example, each embody expectations that can surprise outsiders who are schooled in very different traditions. Even apparently similar contexts can embody forms of rationality that might not be immediately apparent to outsiders.

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