UGBA105: Organizational Behavior

1. Walter A. Haas School of Business University of California, Berkeley UGBA105: Organizational Behavior Professor Jim Lincoln Week 7: Power, politics, & networks in Organizations

2. Power and Politics:Class Agenda • Review forms of power in organizations • Consider how power and politics can be good and bad for organizations • Discuss managing politics “up” and “down” • Analyze power as the management of resource dependencies • Examine political and networking strategies for advancing your goals and thwarting the opposition • View and discuss video on “Managing your boss”

3. Power and politics in organizations • Power: a “dirty word?” “Power corrupts and absolute power corrupts absolutely” • What is it? • The capacity to get people to do what they would not otherwise do • And politics? • The social relations of interest formation, power-seeking and wielding, and decision-making

4. “Power corrupts” “Power tends to corrupt and absolute power corrupts absolutely. Great men are almost always bad men, even when they exercise influence and not authority: still more when you superadd the tendency or the certainty of corruption by authority.” John Emerich Edward Dalberg, Lord Acton (1834–1902): Letter to Mandell Creighton, April 5, 1887. Reprinted in Acton, Essays on Freedom and Power, ed. Gertrude Himmelfarb, pp. 335–36 (1972).

5. Leadership is power; but not all power is leadership Leadership: • Influencing others with charisma and vision • Developing committed “followership” Other ways of getting & exercising power: • Leveraging the formal organization • Exercising authority • Designing and implementing systems • Trading on scarce skills or resources • Maneuvering, manipulation

6. John F. Kennedy 35th President Term of office: 1/20/1961 - 11/22/1963 Lyndon B. Johnson 36th President Term of office: 11/22/1963 - 1/20/1969 Contrasts in presidential power

7. More powerful politicians “Boss” Tweed Sen. Everett Dirksen Representative Tom DeLay

8. Niccolo Machiavelli (1469-1527) “…(A) wise prince ought to adopt such a course that his citizens will always in every sort and kind of circumstance have need of him.., then he will always find them faithful." “No enterprise is more likely to succeed than one concealed from the enemy until it is ripe for execution." “He who is the cause of another becoming powerful is ruined” "Hence it is necessary for a prince wishing to hold his own to know how to do wrong, and to make use of it or not according to necessity. "

9. The purpose of power: decision-making 1. The classical rational model • Managers devise programs (“standard operating procedures”) so that decisions are made “by the book” • Such routine or programmed decisions are delegated down the hierarchy; exceptions are managed by higher-ups • Higher level decisions are uncertain and require problem-solving search • Modern decision tools can help 2. The political model Decision-making is unplanned and disorderly. It can occur without clear rules and behind the scenes. It is the outcome of conflicts in which one side prevails over others

10. HP’s messy (and very public) politics Boardroom DuelBehind H-P Chairman's Fall,Clash With a Powerful Director The Cautious Patricia DunnAnd Flashy Tom Perkins Were a Combustible Pair WSJ, G. Anders and A. MurrayOctober 9, 2006 Fiorina: Board intrigue familiar. Fired chief executive at HP describes 'veil of dysfunction' B. Pimentel, SF Chronicle, Tuesday, October 10, 2006 C. Fiorina: Tough Choices: A Memoir, 2006

11. Managing power and politics • Politics isn’t pretty, but it is real, pervasive, & manageable • Myth of the apolitical business organization • How to analyze and navigate the political terrain • Map out the actors, interests, goals, resource/power bases, strategies, networks, coalitions, decision events • How to manage power and politics • “Managing down” (From the organization’s perspective) • Contain & channel politics in productive ways • “Managing up” (From the employee’s perspective) • The myth of the “good employee” • How to get power and use it • How to be savvy; a player; on the winning side

12. H. Ross Perot Founder and CEO, Electronic Data Services and Presidential Candidate, 1992 and 1996 “If someone as blessed as I am is not willing to clean out the barn, who will?” “Business is not just doing deals; business is having great products, doing great engineering, and providing tremendous service to customers.” Perot ran for president of the United States in 1992 as an independent candidate, winning 19 percent of the vote—one of the largest percentages ever for an independent candidate. He ran again in 1996 on the Reform Party ticket.

13. Managers’ attitudes toward workplace politics Ganz and Murray “The Experience of Workplace Politics” Academy of Management Journal 23 (1980)

14. The myth of the “good employee” • Keep your nose clean and to the grindstone • Concentrate on doing your own job well • Don’t venture outside your silo/cubicle • Obey the rules • Defer to your betters • Assume your superiors know what they’re doing • And do what they say • Assume that the smartest, best, and hardest-working people inevitably win in the end

15. Individual qualities that can serve you well as an organizational politician • Self-efficacy • Extroversion/gregariousness/aggressiveness • Communication skills • Energy/drive • Creativity • Skepticism • Tolerance for uncertainty and risk • Introspection/emotional control • Commitment/dedication • To organization or faction • Competence at your job • Relish competition and winning

16. Causes of organizational politics • Resource scarcity • Leadership: too weak or too strong • Informal organization • Culture: • Weak overall • Strong subcultures • Shared and strong but values politics • Networks • Extensive but fragmented • Formal organization • Too weak • Lack of authority and rules; ill-defined roles • Too strong • Segmentation & interdependence  conflict • Rigidities are politically exploited • Crisis, turbulence (e.g., takeover)

17. The bad side of organizational politics • From the organization’s perspective • Processes • Plotting, back-stabbing, rumour-mongering, vengeance-seeking, sabotage, corruption, secrecy, hoarding, zero-sum games • Outcomes • Goal subversion/suboptimization; factionalism; stalemate & inertia, high cost in time & resources, loss of transparency and accountability • For the participant’s perspective • Uncertainty, anxiety, frustration, stress, isolation, inability to focus on tasks, failure

18. Bob Ebeling: Manager of the Rocket Ignition System at Morton-Thiokol “We did our level best, but it wasn’t good enough...The decision to recommend a launch was pre-ordained by others, by NASA leaning on our upper management. The deck was stacked.” “I was so sure that Challenger was doomed that I asked my daughter, Leslie, then 33, to my office to watch a super colossal disaster unfold on live TV...and then I prayed” That he foresaw disaster and could not stop it has tortured him since.

19. The good side of organizational politics • Positive processes • Conflict is open and “positive-sum” • Rules of the game are established and abided by • Consensus is maintained on core values • Factions and coalitions have shifting memberships • Positive outcomes • People are motivated and empowered • Better teamwork and collective action • The organization is more flexible & adaptive • Fewer “silos,” entrenched interests & unproductive routines

20. Politics as empowerment: Getting things done with and through others The modern flat, lean, horizontal organization power & politics • Power is no longer packaged as authority roles • People have a mandate to get power and use it • Fewer bureaucratic impediments to political maneuvering • Influence, brokering, networking, alliance formation

21. Apple’s lack of formal structure  networks and politics “Apple is highly relationship and network oriented. If you know the right people you can get things done—there are lots of inner circles. Management by coercion doesn’t work here.. There is a lot of politics—like everywhere-but lack of rules and policies may make it more important here. Most organizations have their smoke-filled rooms; Apple does too. The difference is that here if you want into the argument, you can find your way in.” --Apple HR manager

22. How to manage power and politics “down” (from the organization’s perspective) • Stay above the fray and be an observant & fair referee • Have good information on the issues, players, arenas, etc. • Stay in contact with all the players • Provide leadership and build a culture that encourages fair play and open competition • Monitor how resources are being used as power bases • Enforce the “rules of the game” • Keep decision outcomes in line with organizational goals

23. Power and politics as the management of resource dependencies(Or how to trade on scarce resources) • Assumption: power comes from leveraging resources in relationships to manage dependence • A’s dependence on B for resource C is: • Directly proportionate to B’s need of C (criticality) • Inversely proportionate to the number of alternative suppliers of C (scarcity) • A has power over B if: • B is dependent on A • A is not dependent on B

24. Types of resources • Authority • Alvin Gouldner: Patterns of Industrial Bureaucracy, • Charisma, reputation, status • Expertise & information • Ability to manage (“absorb”) uncertainty • M. Crozier: The Bureaucratic Phenomenon, • Time & effort • R. Michels: Political Parties: A Sociological Study of the Oligarchical Tendencies of Modern Democracy • Position in networks

25. Network position as a resource: Power flows to centrally-placed actors 4 3 15 11 U 5 6 12

26. Political strategies Having a power base is not enough! • The next step is devising political strategies to advance goals and overcome opposition • Anticipate the opposition’s moves (strategies & tactics) and plan your response

27. Political strategies • Monopolistic strategies • Claim your resources are critical • Restrict supply • Bureaucratic strategies • Pursue or resist restructurings and formalization • Selective use of objective criteria • Manage the “numbers” • Manage decision-making events • Control what’s on the agenda • Control the order of consideration • Control the decision alternatives

28. Reorgs & politics

29. Networking strategies • Network widely • Work the halls • Get good at small talk (learn the culture) • Cultivate friendships • Position yourself: • Be central; be a bridge or broker • Build coalitions • Get others obligated to you • Logroll: “You scratch my back and I’ll scratch yours” • Prevent or break up their coalitions • Exploit structural holes: “My enemy’s enemy is my friend” • Divide and conquer

30. Networking strategy: Be central; be a broker! 4 3 15 11 U 5 6 12

31. Networking strategy: Forge “weak” ties! 1 5 4 8 U 6 3 7 9 12 10 11

32. Networking strategy: Exploit structural holes(My enemy’s enemy is my friend) - B B - + A A - C - C

33. Conclusions:Power, politics, & networking • For the employee: • You can be competent, work hard, do your job, accomplish goals…. • AND STILL LOSE • To people better at organizational politics than you • For the organization: • Power, politics, and networks are not all bad and can be good • But they have to be understood and managed

34. Donna Dubinsky case Who were the allies and adversaries in this conflict? What were the reasons for the conflict? What resources did the parties bring to bear? What strategies were used? Who prevailed and why? Does the gender of the protagonists have any relevance here? Why or why not? How might the debate over the distribution system have been better managed? How did Apple’s culture, structure, and the leadership styles of the executive team shape the evolution of the conflict? Was “incongruence” or poor alignment among the various parts of Apple’s organization a cause of the conflict? Was it leveraged or exploited in any way by the players?

35. xxx

36. Donna Dubinsky’s 10 lessons • Get your “go-to-hell” money together • Pick your boss well • Negotiate with two or more options • Treat people with respect • Don’t dwell on sunk costs • Challenge convention • Don’t fight every battle • Know your competitors • Think global • Don’t overestimate others