Kahneman (2011) in discussing decision-making expounds upon heuristics and biases in showing how intuitively reached decisions usually are not intuitive at all. This process of decision-making advances through understanding Miles and Snow (1978) discussion regarding how structure and process constrain strategy. Miles and Snow (1978), quote fellow researchers March and Simon (1958) and Cyert and March (1963), on how organizations limit uncertainty in decision-making through the structure of the organization and the processes in the organization. This is a bedrock principle to understanding how any organization reaches a decision, whether the decision is to produce a certain product or hire a particular employee, Miles and Snow (1978) suggest that decision makers are so influenced by the structure and processes that limits and boundaries become more important than the idea. Miles and Snow (1978) begin their work with a discussion, based upon Chandler’s (1962) work, that strategy and structure link eternally and that the structure of the organization imposes both an adaptive cycle and strategic-choices upon an organization. These principles of strategy, discovered before leaps forward in desktop computing, have not changed with the human interaction to high technology, only enhanced by human technology. Thus, a bias in decision-making is the organizational structure and if the organization desires to improve decision-making by lower level managers and employees’, reducing the bias influence of the organizational processes remains crucial. At this point, many might claim, the dated materials from Miles and Snow (1978) render the argument null and void, except when examples emerge of this philosophy in action. For example, ENRON, the organizational structure purposefully changes to fit the new leadership style of the incoming CEO. Shortly after the new CEO takes the helm, lower-level employees begin making decisions based upon the new organizational structure mimicking the decisions of higher-level managers, directors, vice presidents, and the CEO. When this occurs, ENRON begins to come apart at the seams as an organization and ethical practice replaced for the flaunting of rules and regulations. The organizational rot or organizational cancer spread from the CEO to every employee along the organizational structure, until the problem became so big and engrained that only complete destruction of the organization could save the employees, the community, and the customers (Dandira, 2012; & Miles and Snow, 1978).

References

Dandira, M. (2012). Dysfunctional leadership: Organizational cancer. Business Strategy Series, 13(4), 187-192. doi: http://dx.doi.org/10.1108/17515631211246267

Kahneman, D. (2011). Thinking, fast and slow. New York, NY: Farrar, Straus and Giroux.

Miles, R. & Snow, C. (1978) Organizational Strategy, Structure, and Process. New York: McGraw-Hill

 

© 2014 M. Dave Salisbury

All Rights Reserved

 

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