Topic discussion

The Ethical Superiority and Inevitabihty of Participatory Management as an Organizational System

Denis Collins School of Business, Uniuersity of Wisconsin-Madison, Madison, Wisconsin 53706

This article asks us to consider, on ethical grounds, the superiority of participative managementover more autocratic alternatives. The author questions the predominance of the autocratic choice in both management practice and theory. Applying the examples of both political and economic history, the author challenges why management seems to be the last bastion of the autocratic choice. Also based on these examples, the author questions how long the autocratic tradition in management can last.

Bart Victor

Abstract During the heady revolutionary days of the 1960s, Slater and Bennis (1964) declared the inevitability of democracy at the workplace. Twenty-five years later, in a retrospection of that article, the authors claimed that they were right (Slater and Bennis 1990). Unfortunately, the data do not support their claim (Lawler et al. 1992). Nonetheless, workplace democracy is inevitable.

This article argues in favor of the inevitability of participa- tory management, one form of workplace democracy, on the basis of its coherence to the social philosophical assumptions about human nature that underlie the forms of political arrangements (democracy) and economic arrangements (mixed economy) in the United States. These communitarian philosophical assumptions have been thoroughly argued in the political science and economic literature to be ethically superior to other sets of social philosophical assumptions that underlie authoritarianism and libertarianism. Currently, organization theory is approximately 200 years behind this literature. Persons who experience significant benefits as a result of the central position of "liberty" in the social philosophical assumptions of democracy and capitalism tend to design organizational systems that significantly restrict the liberty of their employees.

The current push for more democratic features is coming from organization theorists doing work on corporate culture, total quality management, gainsharing, and other systems of management that encourage decentralization, and from busi- ness ethics scholars doing work on the societal accountability of organizations. The very slow rate of evolution to work- place democracy is primarily attributed to the central role of the power elite. Whereas the American political and eco-

nomic revolutionaries came from within the power elite of their times that is not yet the case for workplace democracy advocates. {Participatory Management; Organization Theory, Busi- ness Ethics; Political Theory)

In reflecting over the past 40 years of management science, the renowned management scientist/philoso- pher C. West Churchman (1994, p. 99) concluded:

As the first editor-in-chief of Management Science, I ex- pressed my ambition for the society (TIMS) and its journal. My notion was that a society and journal in the subject of a science of management would investigate how humans can manage their affairs well. For me, "well" means "ethically," or in the best interest of humanity in a world of filthy oppression and murder (I'm a philosopher and therefore have a philosophical bias, the same bias Plato had when he wrote The Republic). I find that 40 years later management scientists have been inventing all kinds of mathematical models and novelties (management by objectives, game theory, artificial intelligence, expert systems, TQM, chaos theory), and none of these has contributed much to the ethical benefit of human beings. Hence, in 1993, we are still waiting for a science of management to emerge, although there are some lights at the end of the tunnel.

A solution to the management science ethics prob- lem raised by Churchman and the new organizational paradigm shifts advocated by Daft and Lewin (1993) can be found by uniting the social philosophical as-

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Table 1 Ethical Foundations of Poiiticai, Economic, and Organization Theories

Authoritarianism Communitarianism Libertarianism

Poiiticai Theory Example Role of Sovereign

Role of Subjects

Economic Theory Example Role of Sovereign

Role of Subjects

Organization Theory Example Role of Sovereign

Role of Subjects

Dictatorship Government commands in all

matters Citizens obey commands for

peace

Planned economy Government commands in all

matters Managers obey commands for

GNP

Traditional management Managers command in all

matters Employees obey commands

for wages

Representative democracy Government establishes goals and

monitors for harms and deviances Interest groups pursue seif, group, and

national interests

Mixed economy Government establishes goais and

monitors for harms and deviances • Managers pursue self, group, and

national interests

Participatory management Managers establish goals and monitor for

harms and deviances Employees pursue self, group, and

company interests

Direct democracy Government monitors for harms

Citizens pursue self-interests

Market economy Government monitors for harms

Managers pursue self-interests

Self-management Managers monitor for harms

Employees pursue self-interests

sumptions of organization theory with those of political and economic theory. The United States has been an international force in persuading other nations to adopt a democratic political system and a mixed economy. The worldwide trend during the 1980s and 1990s is away from dictatorships and toward democracy and mixed economies. As shown in Table 1, a range of political arrangements parallels a range of economic arrangements. These parallels are based on shared social philosophies about the relationship between sovereign and subjects in the political and economic realms. Historically, the authoritarian model has been dismissed from both political and economic discussions in the United States. Currently, the framework for both political and economic discussions is defined by communitarians and libertarians.

Some of the fundamental social philosophical as- sumptions about human nature and social organization made by political and economic theorists, and embod- ied in some of our most significant political and eco- nomic institutions, are diametrically opposed to some of the assumptions about human nature and social organization made by organization theorists and em- bodied in a large number of organizational structures. A growing stream of political, economic, and organiza- tion theorists have pointed out this contradiction, in- cluding Adam Smith (1976b) in The Wealth of Nations. Smith feared that business owners would be tempted to apply division of labor to an unethical extreme, where the worker "becomes as stupid and ignorant as

it is possible for a human creature to become" (1976b, vol. ii, p. 303). In the 1800s, Alexis de Tocqueville (1945) noted that democracy in America could be un- dermined by the developing aristocracy being estab- lished in industrial organizations. Karl Marx (1964) was enraged by the meaningless lives of alienated workers. These criticisms by conservative and liberal political and economic theorists found a home in organization theory among prominent human relations and human resource management writers who maintained to vari- ous degrees that nonmanagement employees should be active participants in an organization's decision-making process. Thus, significant progress toward the institu- tionalization of participatory management—a system of management whereby nonmanagement employees significantly influence organizational decisions—has been made over the past century.

Unfortunately, the original ethical foundation for the superiority of participatory management over top- down management has been discounted by organiza- tion theorists and managers in favor of other argu- ments, particularly the economic efficiency argument that participatory management is superior to top-down management because it increases employee productiv- ity and firm profitability. However, the empirical re- search on participatory management provides mixed findings (Cotton et al. 1988, Wagner 1994). For in- stance, managers often note that there is significant management pressure to abandon participatory man- agement mechanisms when it becomes apparent that

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employee involvement is not increasing productivity or profitability to the high degree anticipated (Collins 1995, Likert 1967). These managers conclude that the economic justifications were highly exaggerated or sim- ply false and revert back to top-down management styles. Wagner (1994) is an example of an organization theorist reaching such a conclusion. After conducting a meta-analytical reassessment of research on participa- tory management that revealed "average size" im- provements, Wagner noted that "the conclusions of this article give cause to question the practical signifi- cance of participation as a means of influencing perfor- mance or satisfaction at work" (p. 327; italics added). A result of these sentiments is that the number of firms using participatory management systems remains very modest (Lawler et al. 1992).

Managers might be more likely to explore why par- ticipatory management is not working and to make appropriate corrections rather than abandon it if the superiority of participatory management had an ethical foundation in addition to an economic one. This article contributes to the growing volume of writing on partici- patory management by developing a useful framework that links the ethical foundations of political and eco- nomic theory with organization theory. The core argu- ments are:

(1) Communitarian and libertarian forms of social arrangements have been well established in both politi- cal and economic theory to be ethically superior to authoritarian forms of social arrangements.

(2) In political and economic theory, communitarian- ism represents the status quo and libertarianism offers ethically legitimate challenges to the status quo.

(3) Organization theory is still dominated by an authoritarian model with communitarianism offered as a pragmatic (rather than ethical) challenge to the sta- tus quo.

(4) From an ethical perspective, the authoritarian model should have been dismissed long ago and the current debate in organization theory should consist of libertarian challenges to communitarian forms of orga- nizational structures and policies.

Several admirable efforts have been made to link organization theory with political theory, particularly among scholars writing on workplace democracy and employee rights (Bowles and Gintis 1993, Dahl 1985, Ewing 1977, Pateman 1970, Scott and Hart 1971). This article develops a much broader social philosophical framework into which these other works can fit.

An issue of Organization Science (Volume 4, Number 2) was chosen randomly to determine how the frame- work would enhance that issue's articles. First, the

ethical foundation for each article was implicit rather than explicit. The research articles on organizational culture (Marcoulides and Heck 1993) and employee participation (Shetzer 1993) would have been particu- larly strengthened if the authors' social philosophical assumptions had been more explicit and linked to the Table 1 framework developed here. Second, in the other articles, the researchers generally assumed the authoritarian model of organizational relationships. Research articles on takeovers (D'Aveni and Kesner 1993), organizational expansion (Mitchell and Singh 1993), formulation processes and tactics (Nutt 1993), international business negotiations (Weiss 1993), strategic alliances (Parkhe 1993), and risk taking (Hoskisson et al. 1993) were all related to power issues based on theoretical models that assumed managers were authoritarian sovereigns and nonmanagement employees were inconsequential subjects. All these au- thors could have benefitted by developing their theo- ries and discussing their findings in relation to the communitarian model.

Scholars seeking to create more humane and fair organizations should ground their critiques and coun- terproposals within the same social philosophical framework that dominates the nation's political and economic debates. To advance this line of inquiry, three contentious assumptions that underlie this article are elaborated: (1) it is appropriate to apply the social philosophical assumptions of political and economic theory to organization theory; (2) congruence among the social philosophical assumptions of political, eco- nomic, and organization theory is highly desirable; and (3) ethical arguments are superior to economic argu- ments. Then the evolution of current political and economic debates is examined. The congruence be- tween political and economic social philosophies is described and they are linked to organization theory.

Three Key Theoretical Assumptions Appropriateness of Analogy Between Political / Economic Systems and Organizational Systems The first key assumption is that organizational systems are analogous to political and economic systems. Rea- soning by analogy is a very useful process of under- standing one concept by drawing comparisons with other concepts that are similar but not identical to it in several key attributes. The debatable issue is whether the concepts being compared are similar in important ways (leading to a good analogy) or trivial ways (lead- ing to a false analogy), and whether the significant differences are compelling enough to dismiss the anal-

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Ogy. For instance, there are significant differences in purpose between political systems (maintaining peace and justice) and economic systems (increasing GNP). Nonetheless, political concepts are often applied to understanding and developing policy recommendations for economic systems, and economic concepts are often applied to understanding and developing policy recom- mendations for political systems, because the two sys- tems share some significant similarities, as discussed subsequently.

In his classic article, March (1962, p. 663) main- tained that "the organization is properly viewed as a political system and that viewing the firm as such a system both clarifies conventional economic theory of the firm and (in conjunction with recent developments in theoretical languages) suggests some ways of dealing with classical problems in the theory of political sys- tems generally." He highlighted three main organiza- tional concerns that are central to political theory: (1) conflict resolution, (2) preference ordering, and (3) allocation of scarce resources. These three concepts are interrelated, as many conflicts are about prefer- ence ordering and resource allocations. Such conflicts occur with both internal (employees) and external (community leaders, public interest groups) stakehold- ers. March's article is primarily concerned with the former. According to March, it is wrong to assume that "conflict is resolved by the employment contract, or—more generally—by the factor prices and that the result is a joint preference ordering of some sort or other" (p. 669).

Political concepts have entered the organization the- ory literature in the areas of political coalitions at work (Astley and Zajac 1991), power (Pfeffer 1992), Machiavellianism (Buskirk 1974, Collins 1992, Jay 1967), and workplace justice (Sheppard et al. 1992). Zahra (1985) reports that 82% of managers surveyed agreed or strongly agreed with the statement "effective executives must be successful company politicians." Political behaviors can be very dysfunctional (Ashforth and Lee 1990). The business sections of book stores are filled with intriguing stories of political problems that have led to the downfall of business leaders, managers, and organizations.

A key similarity among political, economic, and orga- nizational systems is the way in which control is exer- cised. As shown in Table 1, this is the sovereign/sub- ject relationship. How should people be governed and conflicts resolved? People can either be trusted and extended significant liberties, or not be trusted and made subject to extensive power of a sovereign. If people can be trusted to behave appropriately when

granted political and economic liberty, why should they not be trusted to behave appropriately when granted liberty within organizations? Why should organizations be exempt from the normal rules of morality?

Importantly, each of the social philosophical as- sumptions, when applied to different systems, results in different techniques. For instance. Table 1 does not imply that because political authoritarians may im- prison dissidents organizational authoritarians also im- prison dissidents. Instead, both political and organiza- tional authoritarians command in all matters, though the techniques for carrying out their commands differ with the contextual features of their unique operating systems. All too often, managers, organization theo- rists, and other business scholars readily dismiss orga- nizational communitarianism on the grounds that rep- resentative democracy is very messy (Jensen 1993). However, Table 1 does not suggest that the specific technique of representative democracy be imposed on organizations. Instead, it suggests that participatory management and representative democracy share many social philosophical assumptions.

Desirability of Congruence among Political, Economic, and Organizational Assumptions The second key assumption is that the social philo- sophical assumptions of political systems, economic systems, and organizational systems should be similar. The desire for value congruence and the creation of a "well-ordered society" is the foundation of moral philosophy. The justifications for value congruences, on both the individual and societal levels of analysis, include the unity of self, the essentiality to coopera- tion, and the creation of stability. John Rawls is just one of a great number of philosophers who have ar- gued this point. In his modern classic A Theory of Justice, Rawls—following in the philosophical tradition of Aristotle, Kant, and Mill—argues that the individual goal is "the unity of the self," whereby people free of contradictions and hypocrisis pursue a rational plan that fits within a personal and societal definition of "the good" (1971, p. 561). Value consistency among social systems is the trademark of a well-ordered soci- ety, and value contradictions are the seeds of individ- ual and social unrest. Value congruence is often essen- tial for cooperation as there must be some agreement on basic rules and shared values for cooperation to occur. It thus leads to more stable relationships and a more stable society.

Importantly, not all value congruence is acceptable. Philosophers assume there is a set of values, or a range of acceptable values, that is indeed better than other

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values. More than 2,000 years ago Aristotle argued that life has an ultimate purpose—happiness—which is achieved through a combination of intellectual virtue, moral virtue, health, and wealth. Specifically what should be included in moral virtue has been a subject of significant philosophical debate. Aristotle's list of virtues has been criticized, defended, and amended.

For example, business ethicist Robert Solomon (1993) maintains that the basic virtues of business include justice, honesty, fairness, trust, toughness, friendliness, honor, loyalty, shame, competition, caring, and compassion. Freeman and Gilbert (1988) provide a slightly different list of socially acceptable values under the heading of "common morality," which include promise keeping, nonmalevolence, mutual aid, respect for persons, and respect for property. The values of freedom, fairness, and security are at the heart of Donaldson's (1989, p. 81) list of fundamental interna- tional rights that multinationals must respect.

Just as important, not all values in these value sets are equal. Solomon (1993), following in the steps of Aristotle, is in very crowded company when claiming that justice is the ultimate virtue, both in corporate life and life in general. Hence both competition and com- passion are to be obtained in reference to justice. As Rawls (1971, p. 4-5) argues, "a society is well-ordered when it is not only designed to advance the good of its members but when it is also effectively regulated by a public conception of justice." Justice is not simply an attribute of government; it is central to the operation of all systems of organization. Within both for-profit and nonprofit organizations, justice considerations weigh heavily in making, applying, and interpreting policies and rules (Sheppard et al. 1992). As business ethicists have long argued, business activities should be evaluated according to these widely held values, which leads into the third assumption of this article.

The Superiority of Ethical Arguments over Economic Arguments The third key assumption is that ethical arguments are superior to economic ones. This is such a well-accepted assumption in philosophy that one is hard pressed to find an article in the past 15 years of Joumal of Business Ethics or the past 5 years of Business Ethics Quarterly that comes close to arguing the reverse, that economic arguments are superior to ethical ones. How- ever, one is hard pressed to find scholarly articles in economics and business journals in which economic evidence is discounted on moral grounds. Business ethicists have attributed the latter phenomenon to a phase in the evolution of ideas that is probably ending.

According to Shepard et al. (1995, p. 577), pre- industrial society operated under a moral unity paradigm where "business activity was linked to soci- ety's values of morality." With the rise of industrialism, business activity was "freed from moral constraints by the alleged 'invisible hand' of efficient markets (the amoral theory of business)," but "[now] some variant of the moral unity paradigm may be recurring in post- industrial society." The moral unity paradigm has been the dominant one for most of the history of civilization, is central to the field of business ethics and, as argued with the preceding assumptions, is making some head- way in the field of organization theory.

Economic techniques and data are ultimately justi- fied according to some moral assessment and princi- ples (Hausman and McPherson 1993). In addition, just as not all value sets are equal, not all arguments based on ethics are equal. It has been long established that deontological and utilitarian ethical theories take precedence over egoism, social group relativisim, and cultural relativism (Brady and Dunn 1995). Lower level ethical theories are often justified according to higher level ethical theories. This ranking of ethical theories is made explicit in Kohlberg's (1981) stages of moral development. One need only go back to the original writings of Adam Smith, the Father of Capitalism, to understand the appropriate relationship between eco- nomic and ethical arguments. The economic arguments in The Wealth of Nations are justified by the ethical arguments found in both The Wealth of Nations and The Theory of Moral Sentiments (Collins 1988, Werhane 1991). Smith justifies the individual pursuit of eco- nomic self-interests on the grounds that it will increase a nation's standard of living, and thus afford the great- est good for the greatest number of people (utilitarian reasoning). In addition. Smith explicitly assumes that individuals restrain their self-interested tendencies be- cause of sympathy, respect for others, and avoidance of harm (deontological reasons). Thus, economics is an essential source of information used in making deci- sions, but economic decisions are evaluated according to deontological and utilitarian moral principles.

From a historical perspective, the social philosophi- cal assumptions of much of organization theory and practice remain 200 to 300 years behind the social philosophical assumptions that generated the new gov- ernance process implemented as the United States. Organization theory has much to gain from historical analysis (Kieser 1994). The following two sections pro- vide a brief summary of historical developments in political and economic theory that can be compared with the current status of organization theory.

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Political Debates in the United States The Dismissal of Authoritarianism Opposition to authoritarian political philosophy has a long history in the United States. Many of the initial waves of European immigrants who traveled across the Atlantic Ocean to settle in the New World were fleeing from political and religious oppression. During the late sixteenth century, Oueen Elizabeth sought to unify the subjects of England under the Anglican Church. By act of Parliament, all clergy of England were made to accept particular religious creeds, such as the Book of Common Prayer, Thirty-Nine Articles, and the Oueen's religious sovereignty. Those who did not accept these creeds were persecuted; publications were censored, assemblies disbanded, congregations fined, preachers imprisoned, and property confiscated (Braehlow 1988, Cragg 1957, Durant and Durant 1961). Failure to ad- here to a particular religious doctrine—whether Angli- canism in England, Catholicism in France, or Lutheranism in Germany, Denmark, and Sweden— could result in torture and exile. Religious dissenters could not hold political or military office, or enter most universities.

In addition to those seeking political and religious freedom, immigrants to the New World included peas- ants, fortune hunters, and criminals. Many of the early political debates within and between groups of settlers concerned the degree of allegiance the group should maintain to its European sovereign. Who ought to govern life in the colonies: Spain, the Netherlands, France, England, or the colonists themselves? For bet- ter or worse, military victories by the British against their European rivals centralized British sovereignship until the Revolutionary War.

Many, but not all, colonists preferred self-rule. In the Declaration of Independence, Thomas Jefferson referred to King George of England as a despot and fyrant who refused to allow the colonists to establish their own legislative and judicial bodies. Without the consent of colonial leaders, the king imposed an army and police force, collected taxes, determined trade policies, and, according to the Declaration, "plundered our seas, ravaged our coasts, burnt our towns, and destroyed the lives of our people." In declaring their freedom from generations of rule by monarchs and nobles, the colonial political leaders were faced with with the same problem from which many of them or their ancestors had fled: how to maintain peace among a population of 2,500,000 whose members were of a variefy of religions intolerant of other religions, most notably Anglicanism, Puritanism, and Presbyterianism (Perry 1944).

Both libertarians and communitarians credit John Locke's (1960) Two Treatises of Government for estab- lishing the legitimacy of government based on the consent of the governed and providing the ethical basis for defending the structures, processes, and policies of democratic governments (Lodge 1976, Rothbard 1978). Locke argued that desirable ends can be achieved, and undesirable ends avoided, when there is only one sovereign group and that sovereign's law-making ability is based on the consent of the governed. According to Locke, God created a humanify that is free and ratio- nal. If no system of central control existed, people (other than a few degenerates) would restrain their behavior according to their reason, which dictates that they should not harm others. Therefore, peace could be maintained in civil sociefy if the sovereign allowed its subjects extensive liberties. Subjects could be trusted to pursue their own self-interests in a manner that would improve the general welfare. The sovereign, who should be accountable to the law, could continue to make and maintain laws on the condition that those laws be in the public interest and have the consent of the subjects. A lack of consent by subjects would un- dermine the legitimacy of the sovereign to govern. The overriding principle of government should be the pro- tection of individual liberfy.

Thus, the U.S. Constitution established minimal gov- ernment. Persons fulfilling the role of sovereign were accountable to the consent of the governed and tremendous restrictions were placed on government's use of power over individuals. The Bill of Rights was amended to the Constitution to further limit govern- mental powers. Individuals were granted the right to freedom of religion, speech, press, arms, and due pro- cess.

Since independence, political debates have flour- ished among communitarians (Bellah et al. 1985, 1991; Dahl 1982; Dworkin 1977; Rawls 1971; Sandel 1982; Walzer 1983) and between communitarians and liber- tarians (Maehan 1974, 1990; Nozick 1974; Rothbard 1978). Proponents of political authoritarianism are rel- egated to the fringes of political discourse (Mendel 1979).

Libertarians Issues in the Bill of Rights are useful in defining and distinguishing between libertarians and communitari- ans. Libertarians interpret individual rights as being absolute (Newman 1984, Rothbard 1978). They rebel against monitoring powers assigned to the government with the exception of judicial oversight for physical harms. For liberfy to flourish, they hold that a nonin-

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trusive judicial system is needed to ensure individual rights by protecting citizens against physical harms imposed on them by others. Libertarians emphasize negative rights—the right not to have one's liberfy or properfy infringed upon by government—and oppose positive rights such as a right, or entitlement, to health care or education. They believe laws pertaining to moral or private issues should be repealed, thus en- hancing individual liberfy.

From a libertarian perspective, the taxing and moni- toring powers of government should be greatly cur- tailed. In accordance with the goals of the American Civil Liberties Union, libertarians such as Tibor Maehan (1988, p. 5) maintain that "much that is evil will have to remain protected from suppression—just as the defender of free speech and worship realizes that yellow journalism found in many tabloids and the televangelism practice of some corrupt preachers is due protection." Important libertarian public policy recommendations include government sale of its large land holdings to private citizens and significant reduc- tion in military expenditures based on allowing the citizens of foreign countries to solve their own prob- lems. Libertarians oppose government funding of the arts and laws that limit individual choices about sex or abortion.

Libertarians view interest-group-based politics as corrupting the democratic process and oppressing indi- vidual differences (Newman 1984, Rothbard 1978). The libertarian ideal is Utopian: no government. The con- cept of a "communify will" is the antithesis of libertar- ianism. The preferred model would be a direct democ- racy that has a very limited function, similar to colonial New England town meetings where occasionally citi- zens met to resolve some dispute or communal need. Though not immune from interest group politics, such meetings provide a fairly level playing ground for each individual participant. A more modern image of this libertarian political ideal is a Ross Perot electronic town hall meeting where key issues are presented to all the citizens and each enters his or her preference into a computer, thus eliminating the need for "representa- tives." Government does serve a minimal purpose for libertarians, the key word being "minimal."

Communitarians Proponents of communitarianism, like libertarians, ac- cept the importance of individual liberfy and reject authoritarianism. Communitarians differ from libertar- ians in that they treat liberfy as a relative right, not an absolute right, and hence are much more willing to restrain the right of free speech when it conflicts with

some other principle, such as the good of the commu- nify (Dowrkin 1977). They reject libertarianism on the grounds that it results in social isolation (Bellah et al. 1991, Durkheim 1933, Fromm 1941) or moral rela- tivism (Kirk 1960, 1988). Individuals are believed to find meaning in their lives by identifying with a social or moral collective.

Throughout this article, the term "communitarian" is applied to a political philosophy, not just the specific growing political movement led by Amitai Etzioni (1993) that is called "Communitarian." Etzioni's Com- munitarian movement consists of liberals and conserva- tives. Democrats and Republicans, who want to em- phasize what they have in common—opposition to "radical individualists, such as libertarians and the American Civil Liberties" who overemphasize rights (p. 11)—rather than political policies that divide them. Etzioni wants what both liberals and conservatives desire: "a judicious mix of self-interest, self-expression, and commitment to the commons—of rights and re- sponsibilities" (p. 26). Communitarians accept the pri- macy of liberfy over authoritarianism, and the primacy of specific communify outcomes (moral rectitude and/or social justice) over individual liberfy.

In the broader use of the term, communitarians strongly disagree among themselves about what are legitimate communify welfare intervention arguments. Conservative communitarians justify government inter- vention on the grounds of moral rectitude; a represen- tative democracy should develop legislation that en- courages moral activities and discourages "immoral" or "sinful" activities (Kirk 1960). For example. Kirk (1960) argues that Jeffersonian democracy was too tolerant in allowing sinful individuals to pursue their immoral vices, and thus erred on the side of moral relativism. It overemphasized the equalify of human beings, which can never be achieved, and underempha- sized respect for authorify and moral order. In this sense, direct democracy lacks a moral compass. John Adams, like his English counterpart Edmund Burke, stood for a representative form of democracy that would restrain liberfy on the basis of religious beliefs and pragmatic considerations. In his view, human be- ings are fallible and some will pursue immoral interests because of emotional weaknesses and ignorance, so moral authorities are needed to direct the nation's activities.

According to conservative communitarians, the moral situation of the country worsened during the industrial revolution. Wealth passed from small business owners and farmers who were in constant personal contact with their employees to impersonal, financially driven

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industrialists ignorant of older traditions. Industrializa- tion and the extensive application of the division of labor broke down personal relationships such that "the wealthy man ceased to be magistrate and patron; he ceased to be neighbor to the poor man; he became a mass-man, very often, with no purpose in life but aggrandizement" (Kirk 1988). Liberals humanely, yet mistakenly, demanded that government respond to their needs. Soon people began to expect government to solve social problems that could be solved only through individual efforts and moral education. Taxes increased, government expanded into a welfare state, and social problems worsened. Thus, modern conserva- tive communitarians, though agreeing with some liber- tarian policies that would reduce the size of govern- ment bureaucracy and get the government off the backs of the citizens, demand that government ban abortions, ban homosexual activities, imprison casual drug users, put warning labels on music, and have public school teachers lead students in prayer, all for the sake of the moral communify.

Liberal communitarians justify government interven- tion on the grounds of social justice and believe gov- ernment should develop legislation that aids the disad- vantaged (Rawls 1971). They see democratic societies as lacking a level playing field: human beings with particular characteristics have undeserved social ad- vantages over others (being born male rather than female, wealthy rather than poor, white rather than black), and this is not fair or just. According to liberal communitarians, the problems of industrialization were compounded by the Caivinistic and Social Darwinian moral perspectives of business leaders. Carnegie (1962) and others preached that material wealth was a func- tion of hard work and God's blessing, and poverfy was a function of being lazy and excluded from God's blessings. They maintained that government should remain minimal because natural laws are at work whereby the strongest deservedly rise to the top and the weakest deservedly stay on the bottom of the social ladder, thus preserving appropriate inequalities in po- litical power and wealth for the good of the commu- nify.

The growing social gap between rich and poor fueled the liberal political programs of Theodore and Franklin Roosevelt. They argued that social justice demanded that government play a more active role in determining and fulfilling communify and human needs. Franklin Roosevelt maintained that government should begin social planning and restricting the liberties of the wealthy for the benefit of the economically worst-off. His solution was the development of a welfare state

rather than socialism, communism, or some other au- thoritarian model. Importantly, liberfy was still the first priorify, but not the only priorify of government. This tradition was carried through to Lyndon Johnson's Great Sociefy project. Thus, liberal communitarians, though agreeing with some libertarian policies that would restrain government from interfering with an individual's private moralify, demand that government provide funds for child care services, national health care, prenatal care, infant nutrition, education, and public housing, all for the sake of social justice.

The abstract distinctions among libertarians, conser- vative communitarians and liberal communitarians can be understood more clearly in the context of a specific issue: pornography. Libertarians argue against any reg- ulation of pornography. Pornographers, like other citi- zens, have an absolute right to freedom of speech. According to libertarians, if government officials are permitted to censure pornographers, they will soon go after the free speech rights of other nonmainstream groups, such as heavy metal rock bands, rap singers, or controversial religions. Both conservative and liberal communitarians argue for restricting the free speech rights of pornographers. Special laws created specifi- cally for pornography—regulating where pornography stores can be located, how pornographic materials are displayed in stores, and how old one must be to pur- chase the products—are advocated on the grounds that such restrictions are necessary for the good of the communify. Conservative communitarians justify these regulations by citing the corrupting influence of pornography on the moralify of its potential con- sumers, particularly children. Liberal communitarians justify these regulations by citing the exploitation of women by pornographers and the negative impact of pornography stores on neighborhoods.

In summary, political debates in the United States revolve around and the tension within communitarian- ism (liberal vs. conservative) and between communitar- ianism and libertarianism. Both liberal and conserva- tive communitarians accept the primacy of liberfy over authoritarianism and argue that the sovereign is justi- fied in restraining liberfy to avoid certain undesirable communify outcomes. Liberal communitarians seek to make amends for social injustices attributed to acci- dent of birth. They maintain that the sovereign should trust individuals on moral issues but intervene to cor- rect what they perceive to be well-embedded social problems, such as poverfy or discrimination. Conserva- tive communitarians seek to make amends for moral injustices attributed to a perverse use of free will. They maintain that the sovereign should trust individuals to

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solve social problems voluntarily but intervene to cor- rect for what they perceive to be immoral activities, such as abortion or homosexualify. Libertarians main- tain that even if the activify or communify welfare outcome is immoral or unjust, every person's liberfy should be tolerated unless people are being physically harmed. Proponents of authoritarianism are not wel- comed to debates in the public arena and are ridiculed for supporting an ethically undesirable political philos- ophy.

Economic Debates in the United States The Dismissal of Authoritarianism The evolution of economic debates in the United States shares a common ethical foundation with the evolution of political debates, so only brief summaries are given here. The opposition to authoritarian economic philos- ophy—a planned economy—has a long history in the United States. Many of the initial wave of European immigrants were escaping from economic oppression as well as political oppression. Today, most economic debates are among proponents of communitarianism (Galbraith 1958, 1967, 1973; Kirk 1960; Nader et al. 1976; Reich 1983; Reich and Donahue 1985; Stone 1976) and between communitarians and libertarians (Friedman 1962, Gilder 1981, Hayek 1944, Maehan 1990, Mises 1949, Rand 1967). Proponents of economic authoritarianism are spurned, particularly with the col- lapse of the pre-1989 Russian economy, and remain on the fringes of political debate (Mendel 1979).

Adam Smith's (1976b) theoretical conceptualization of capitalism was a reaction against the authoritarian abuses of mercantilism. Smith maintained that the mercantilist policies of government sanctioned monopolies, import quotas, guilds, and many other economic restrictions generated poverfy, not wealth. He argued that the general welfare could be better advanced by allowing all citizens, not just a handful of merchants with government connections, to pursue their economic self-interests. According to Smith (1976a), the presence of moral sentiments—as well as the development of one's conscience, belief in God, and fear of the law—restrains most individuals from pursuing self-interests in a way that may harm others. Hence, government intervention should be limited to providing a system of justice, a military, and some essential public goods (such as roads), all of which are unlikely to be generated by individual pursuit of eco- nomic self-interests (Collins 1988, Collins and Barkdull 1995). Decisions about what to produce, quantify and qualify of production, means of distribution, price, and

levels of employment should be made on the manage- rial level, not by government officials. Although con- strained by sociological factors—such as class status or geography—laborers should be given the liberfy to choose places of employment.

Libertarians Libertarians place the blame for the United States' economic problems on unnecessary government inter- vention in the economy and the oligopolistic practices of large business organizations (Rothbard 1978). At the time of the industrial revolution, the leaders of indus- try consolidated their economic power and controlled politicians to such an extent that legislation was en- acted to protect them from competitors. Government intervention increased during the Great Depression and, in the libertarians' view, the application of Keyne- sian economic theory only worsened the situation. Fur- ther, New Deal legislation led to the development of a welfare state, resulting in a mixed economy rather than a market economy.

According to proponents of libertarian economic theory, government is currently too intrusive in the economic sector and should abolish the welfare state (Friedman 1962, Murray 1984, Rothbard 1978). They propose that government intervention in the economy be limited to establishing laws that foster economic competition and that all laws restricting economic ac- tivify be eliminated. Also, they hold that the govern- ment has mistakenly categorized a large number of goods and services as public goods that should be privatized, including national defense, police and fire protection, transportation, water and sewer services, garbage collection, the judicial system, prisons, and mail service. Libertarians contend that rather than government imposing services on citizens, services should be provided by private enterprises and pur- chased by citizens.

Communitarians Conservative communitarians agree with libertarians that government should rescind most regulations of economic activify, disband regulatory bureaucracies, foster competition, and privatize many goods and ser- vices now provided by government. However, they note that the Clommerce Clause of the U.S. Constitution delegates to government the power to regulate some economic activities and transactions for the benefit of communify welfare. From their perspective, govern- ment is justified in restraining economic activify that is either based on or fosters immoralify. Hence, conserva- tive legislators have proposed that government ban

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interstate dial-a-porn, prohibit the sale of sexually ex- plicit materials, oppose attempts to legalize or decrimi- nalize any illicit drugs, require parental consent for minors to purchase contraceptives, and support "com- munify standards" on pornography and other forms of entertainment.

Liberal communitarians argue that government in- tervention is justified when public goods are not gener- ated by individual pursuit of self-interests (such as mail service to all households regardless of economic status) or when powerful economic actors do not have a sense of justice to restrain their liberfy (as in some wage disputes between management and labor). They hold that social justice demands some industrial policy plan- ning on the national level (Galbraith 1967, Lodge 1976). According to liberal communitarians, government regu- lation should be enacted when the market system does not appropriately monitor itself for inefficiencies, pro- ducer rents, externalities, inadequacy of information, unequal bargaining power, moral hazards, and re- source scarcify (Breyer 1982). Hence, liberal legislators have proposed that government increase the minimum wage, support comparable worth and family leave poli- cies, restrict corporate takeovers and golden para- chutes, and enforce health and safefy regulations and pollution laws.

Congruence Between Political and Economic Social Philosophies Theoretical linkages have been established among the various political and economic social philosophies. As shown in Table 1, dictatorships and planned economies are linked by an authoritarian social philosophy; direct democracy and a market economy are linked by a libertarian social philosophy; and representative democracy and a mixed economy are linked by a com- munitarian social philosophy.

According to Mises (1949), Friedman (1962), and Novak (1982), there is congruence between the liber- tarian social philosophies of democracy and a market economy. Both systems establish extensive limits on the sovereign's coercive powers and establish individual liberfy as a priorify. More importantly, democracy and a market economy are interpenetrating systems that feed off one another. Friedman's central argument in Capitalism and Freedom is that "there is an intimate connection between economics and politics, that only certain combinations of political and economic ar- rangements are possible, and that in particular, a soci- efy which is socialist cannot also be democratic, in the

sense of guaranteeing individual freedom" (p. 7-8). Neoclassical economists maintain that an erosion of economic liberfy by government is likely to be followed by an erosion of political liberfy. An important central debate pertaining to the current transformation of authoritarian governments to democratic capitalism (the former Soviet Union, China) is whether political freedom should precede economic freedom, or vice versa (Diamond and Plattner 1993).

According to Marx, Lenin, and Mao, there is congru- ence between the authoritarian social philosophies of dictatorship and a planned economy (Mendel 1979). Both systems establish extensive limits on individual liberfy and encourage the sovereign's use of coercive powers. For instance, Lenin (1963, p. 20) compared the role of a political leader with that of an orchestra conductor who knows "who is playing which violin and where, where and what instrument [each person] has learned and is learning to play, who is playing wrongly, where and why... and who should be transferred, who and where, in order to correct the dissonance." After the collapse of the Russian monarchy in April 1917, Lenin called for the nationalization of all land and the formation of one national bank. Upon the overthrow of Kerensky's provisional government six months later, Lenin was forced to articulate an administrative plan for governing the Soviet Union. He proposed a wide range of governmental policies that included strict countrywide accounting and control of production and distribution of goods, guidance by experts to achieve mass advancements in productivify, high pay for the production experts, further centralization of banking, consolidation of monopolies, and compulsory labor ser- vice. Lenin maintained that political and economic success could come about only through an absolute unify of will among all people, implemented through the single will of their political leaders.

The United States is neither a direct democracy nor a pure market economy. Instead, it is a representative democracy with a mixed economy, both of which de- pend on a large federal bureaucracy. In 1990, the federal government collected $1,155 trillion in revenue and spent $1,393 trillion. Federal office space is equiv- alent to all the office space in the nation's 10 largest cities multiplied by a factor of four. Hence, liberfy matters greatly, but not to the exclusion of political and economic goals established by the sovereign on the basis of a communitarian social philosophy. The sovereign is held accountable to the subjects. Accord- ing to Lodge (1984), the United States is evolving toward political and economic communitarianism de- spite the efforts of libertarians to stop that process.

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In summary, communitarian political and economic arrangements are considered to be ethically superior to competing authoritarian arrangements because they fit widely held views of human nature and have generated many socially desirable outcomes. In reference to hu- man nature, communitarian social arrangements allow people to freely (1) pursue their self-interests, (2) care about the welfare of others, and (3) rely on "reason" to restrain their self-interested tendencies so as not to harm others. On the basis of its social philosophical assumptions, the U.S. government protects the liberty of citizens to pursue their political and economic inter- ests and intervenes when individuals misuse their free- dom as a result of individual fallibility/selfishness or when certain public goods are not generated. Although many social problems remain to be addressed, repre- sentative democracy and the mixed economy have greatly improved community welfare in the United States. Importantly, communitarians borrow many ideas from libertarians. Liberal communitarians join forces with libertarians in opposing government policies advo- cated by conservatives concerned with moral rectitude. Conservative communitarians join forces with libertari- ans in opposing government policies advocated by lib- erals concerned with social justice.

Organization Theory and Political / Economic Philosophies Authoritarianism and Organization Theory Authoritarian managerial power at the workplace has a long history that includes the institution of slavery in Greece, Rome, and the United States. As is evident in the writings of Social Darwinians (Carnegie 1962), tyrannical power is a deserving reward for successfully climbing the organizational ladder. Typically, organiza- tion theorists attribute the structures and processes of traditionally managed companies to the theoretical work of Taylor (1947), Fayol (1967), and Weber (1959), all of whom were concerned to various degrees with the bureaucratic nature of organizational activities, as- signment of planning activities solely to management personnel, and concise determination of the nature of work tasks to be performed by nonmanagement em- ployees. In general, these organization theorists main- tain that managers should determine policies and im- pose them on organizational members. Organizations should have a hierarchical chain of command and the communication process should flow from the upper levels of management down to the lowest levels of the organization. Nonmanagement employees should not

contribute to managerial decisions unless they are so commanded by managers.

Organization theorists who chronical "organizational reality," particularly Weber (1959), can aid the under- standing of managerial authoritarianism. Weber pro- vided several managerial justifications for bureaucracy that are also a very strong defense of the authoritarian model for organizations. He contended that managers need to (1) coordinate the services of many workers on a continual basis, (2) rationally exploit similar types of work through unified command, (3) provide continuous common supervision to achieve a technically rational organization of work, (4) establish expert training, (5) discipline workers, (6) derive decisions based on high levels of technical efficiency, (7) maximize technical rationality, (8) maintain technical and commercial se- crets, (9) speculate on business policy, and (10) estab- lish bargaining superiority. Weber concluded that "ex- perience tends universally to show that the purely bureaucratic type of administrative organization—that is, the monocratic variety of bureaucracy—is, from a purely technical point of view, capable of attaining the highest degree of efficiency and is in this sense for- mally the most rational known means of carrying out imperative control over human beings" (p. 337).

By far the most ardent defender of social philosophi- cal assumptional similarities among authoritarian polit- ical, economic, and organization theories was Lenin. He strongly argued that the sovereign should dictate in matters of politics and the economy, and also that Soviet business organizations should implement Tay- lorism, the key component of the authoritarian organi- zation model. Lenin maintained that the educational and cultural level of the masses had to be raised significantly, along with worker discipline, skill, effec- tiveness, and intensity of labor, to increase productivity to a level beyond that in capitalist nations. Therefore, Soviet managers would have to adopt the best achieve- ment of capitalism: authoritarian-based scientific man- agement. Lenin (1975b) argued that organizational suc- cess depended on managers being able to "organize in Russia the study and teaching of the Taylor system and systematically try it out and adopt it to our own ends" (p. 447). He demanded that people unquestioningiy subordinate themselves "to a single will of the leaders of labor" (1975b, p. 455).

How prevalent is organizational authoritarianism during the 1990s? Apparently no studies have mea- sured the degree of authoritarianism in organizations nationwide. Nonetheless, the following five indicators suggest that authoritarianism remains prevalent: (1) research on the prevalence of participatory manage-

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ment processes, (2) the lack of civil liberties at the workplace, (3) the experiences of corporate culture scholars, (4) anecdotes in both the scholarly and gen- eral business literature, and (5) the nature of manage- ment education programs.

First, research documenting the prevalence of partic- ipatory management practices and policies of compa- nies reveals that companies are still very resistant to them. Lawler et al. (1992) surveyed Fortune 1,000 firms and categorized them according to the percentage of employees covered by a variety of participatory man- agement practices. Using 40% of the employees cov- ered as a cutoff (still less than half of all employees), they found that only 3% of the firms had substantially used gainsharing, 11% used quality circles, and 3% of those with unions had union-management Quality of Work Life committees. Even a relatively easy-to- administer communitarian practice such as obtaining survey feedback was being used substantially by only 31% of the respondents. Similarly, an extensive study by the New York Stock Exchange found that only 14% of all companies with more than 100 employees cur- rently had some form of human resource program (Freund and Epstein 1984). One of the most common types of activities was employee appraisal and feedback (23%). Only 13% of the companies had suggestion systems, 8% had labor/management committees, and 5% had production teams. For his case study book on resolving employee grievances, Ewing (1989), a Har- vard Business School professor with many contacts, wrote to "several hundred" companies and could find only 30 to 50 with a due process grievance procedure for nonunion employees; the other companies had, at most, an open-door policy.

Second, the lack of civil liberties within organiza- tions fosters authoritarianism. As argued by Ewing (1977, p. 3), Americans are denied the "freedom of press, speech, and assembly, due process of law, pri- vacy, freedom of conscience, and other important rights" when they are at work. This lack of civil liberties is apparent in nonprofit as well as for-profit organizations. The whistle-blowing literature provides numerous cases documenting employees' unsuccessful attempts to exercise civil liberties at the workplace (Miceii and Near 1992).

Third, the depth of an authoritarian culture within traditionally managed business organizations is particu- larly evident in the writings of corporate culture theo- rists. Whether referred to as a bureaucratic culture (Kilmann 1984), control paradigm (Lawler 1986), tradi- tional paradigm (Veltrop and Harrington 1988), a ra- tional model (Peters and Waterman 1982), or the Old

Guard (O'Toole 1985), the cultures that organizational consultants find in the companies they are attempting to transform are very similar in one respect: they are authoritarian. After decades of modifications in organi- zation theory, work within business organizations re- mains highly organized, compartmentalized, and con- trolled through managerial command.

Fourth, a vast number of anecdotes in both the scholarly and general business literature suggest the prevalence of authoritarianism. The business ethics literature is filled with examples of the "just do it" mentality in organizations. For example, an in-depth survey of 30 recent graduates of the Harvard MBA program found that 11 had faced strong organizational pressures from above to act in an unethical manner (Bardaracco and Webb 1995). Recent books such as The Force (Dorsey 1994) and Liar's Poker (Lewis 1989), among many others, have documented the authoritar- ian tendencies of managers in America's largest and most influential organizations. Even such "socially re- sponsible" firms as Ben & Jerry's (Lager 1994) and The Body Shop (Entine 1994) have struggled with their very public efforts to abide by the communitarian ethos.

A similar deduction is evident in the growing litera- ture on reforming boards of directors. If CEOs expect blind allegiance from the powerful business personali- ties who sit on boards of directors (Park 1995, Pound 1995), what is the likelihood that they sincerely encour- age employee participation farther down the organiza- tional hierarchy? Most agency theory-based solutions to the problem of controlling managers through corpo- rate governance mechanisms favor more narrowly aligning managerial interests with shareholder inter- ests, thus increasing the likelihood of organizational authoritarianism, and reject the communitarian solu- tion of placing stakeholders other than business people on boards (Hart 1995, Jensen 1993).

Fifth, the nature of management education pro- grams also encourages authoritarian tendencies. Al- though the Organization Behavior group at the Har- vard Business School has long had a preference for employee participation (Ewing 1990), MBA graduates from Harvard and other leading business schools em- phasize controlling employees on the basis of financial considerations (reduce overhead, inventory, assets, la- bor costs) rather than communitarian social philosophi- cal considerations (Collins 1996, Robinson 1994).

Importantly, the social philosophical framework de- veloped in this article does not depend on whether readers believe that authoritarianism or communitari- anism is the dominant organizational paradigm in the literature or in practice. Instead, the argument put

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forth here is that the communitarian paradigm is ethi- cally superior, and that central debates in organization theory should be among competing or complementary communitarian forms of management and between communitarian and libertarian forms of management. The field has not yet reached that stage of social philosophical evolution.

Communitarianism, Libertarianism, and Organization Theory If it is true that people are self-interested, concerned about the welfare of others, and rational yet imperfect, what type of organizational structures, processes, and policies should managers create to govern them while they perform work tasks? As suggested in Table 1, the system should be based on the same social philosophi- cal assumptions about sovereigns and subjects that underlie representative democracy and the mixed economy. The sovereign—in this case, management— should establish goals and monitor for harms and de- viances. Subjects, in this case nonmanagement employ- ees, should be able to fulfill their individual and work group interests while accomplishing company goals es- tablished by managers with their input.

A wide variety of participatory management struc- tures, processes, and policies that are based on a communitarian social philosophy appear in the man- agement and business ethics literature, such as em- ployee representatives on boards of directors, labor- management committees, joint task forces, Scanlon- type gainsharing plans, quality circles, socio-technical work teams, suggestion systems, employee attitude sur- veys, goal setting, job enrichment, codes of ethics, ethical analysis, an employee bill of rights, and em- ployee stock ownership plans (Donaldson 1982, Freund and Epstein 1984, Huse and Cummings 1985, Kelso and Hetter 1967, Lawler 1986, Stone 1976). These participatory management features differ according to size, scope, and form of employee involvement. They increase employee involvement in the company's deci- sion-making process while enabling managers to inter- vene when employee decisions fail to achieve organiza- tional goals.

Libertarian models of organizational arrangements are underdeveloped. One of the few systematic efforts in this area was by Freeman and Gilbert (1988). In the tradition of John Locke, they proposed that when granted freedom and liberty, individuals typically guide their behavior by the precepts of common morality. Most individuals tend to keep promises, respect the rights of others, and refrain from harming those nearby.

Individuals are good citizens not only in a democratic political system, but also in a corporate environment.

In a libertarian organization, agreements between management and nonmanagement employees would be grounded in the values of freedom and liberty, with an appropriate fit between the personal projects of indi- viduals and the goals of the organization. Freeman and Gilbert suggest that companies adopt a personal pro- jects enterprise strategy whereby individuals have the liberty to pursue personal projects that coincide with organizational goals. A foundational ethic for such an organization culture is personal autonomy. The end result would not be anarchy because there would be congruence between an individual's personal projects and organizational goals. Thus, Freeman and Gilbert reverse the logic of authoritarianism by arguing that a business organization should serve as a means to indi- vidual ends instead of people serving as means to organizational ends. In this sense, companies exist as a set of contractual arrangements (Keeley 1988, 1995) and managers should act as brokers of other people's personal projects. Policies and procedures within orga- nizations should be guided by the principles of per- sonal autonomy, conventional rights, respect for per- sons, and voluntary agreements. A more radical liber- tarian alternative would be to give each member of an organization an equal voice in management decisions, thus abolishing organizational hierarchy (Lindenfeld and Witt 1982).

Objections to Communitarianism The chorus of organization scholars noting the onset of a new managerial revolution and encouraging the im- plementation of participatory management systems has been steadily growing for more than three decades (Lawler et al. 1992, McGregor 1960, Preston and Post 1974). Despite the proclamations by some academics that workplace democracy has arrived because "the pyramid-shaped organization chart has gone the way of the Edsel" (Slater and Bennis 1990, p. 174) or that the participatory management "revolution itself is clearly underway" (Preston and Post 1974, p. 484), the many indicators listed previously suggest that organizations are adopting participatory management techniques only superficially, if at all. Why do managers continue to choose, and some organization theorists support, orga- nizational patterns that are based on authoritarianism and reject alternative organizational patterns? Three very important objections to organizational communi- tarianism are that (1) managers should be categorized as subjects with extensive liberty rather than as

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sovereigns whose liberties should be restricted, (2) communitarianism is an experimental ethical luxury, and (3) few employees advocate for participation. All three objections demonstrate the depth to which au- thoritarian assumptions still underlie thinking about how companies should be governed. Each requires further elaboration and counterarguments.

The first objection is often assumed and rarely stated. As noted previously, most organization theorists do not explicitly state their social philosophical assumptions (Scott and Hart 1971). One of the rare exceptions can be found in the writings of Locke and his colleagues. Locke and Sehweiger (1979) categorized theorists mak- ing communitarian-based recommendations as left-wing authoritarians and defended their own authoritarian recommendations on libertarian grounds. According to them, managers (as political subjects) are granted the liberty by government to manage however they desire; if managers prefer to be authoritarians, so be it. Unfor- tunately, Locke and Sehweiger fail to distinguish that although managers are subjects on the political level of analysis, they are sovereigns on the organizational level of analysis. Hence, those who have benefitted greatly from political and economic liberty impose authoritari- anism within the organizations they manage. While performing their jobs as organizational sovereigns, managers should follow the same rules that are applied to political sovereigns, not political subjects. It is essen- tial to constrain the liberty of sovereigns because of the power they wield in their respective systems.

Advocates of the second objection maintain commu- nitarianism is an experimental ethical luxury that orga- nizations cannot afford in the competitive global envi- ronment. However, two of America's most significant global competitors, Germany and Japan, have many companies that operate according to communitarian principles. Union representation on the boards of di- rectors is legislated in Germany. Japanese companies are the source of many of the communitarian innova- tions with which American managers are experiment- ing. In addition, political dictators and proponents of planned economies could apply the same logic to sup- port authoritarian political and economic models. Short-term performance pressures are often used as justifications by dictators for maintaining martial law policies on a permanent basis. Similarly, managers are quick in using short-term performance to justify declar- ing authoritarian martial law conditions within their organizations on a permanent basis.

Many of the criticisms leveled against the adoption of participatory management parallel Aristotle's (1984) and Lenin's (1975a) criticisms of democracy (Ross and

Collins 1987). The concern is that involving nonman- agement employees in a company's decision-making process may lead to organizational mediocrity, rule by the uneducated and unskilled, bureaucracy, instability, and lack of accountability. Scholars need to counter this rejection of communitarianism with the many ex- amples of communitarian success and emphasize the often overlooked negative effects of "petty tyrants" (Ashforth 1994). Several literature reviews and surveys have concluded that communitarian companies can operate very efficiently and effectively (Cotton et al. 1988, Glaser 1976, Lawler et al. 1992, Miller and Monge 1986, Wagner and Gooding 1987), and most management textbooks contain examples of successful efforts. In particular, research conducted by Tannen- baum and colleagues on employee participation consis- tently shows that control in organizations is not a zero-sum game; the greater the decentralization of control, the greater the total control within the organi- zation (Bartoike et al. 1982, Tannenbaum 1986, Tan- nenbaum and Cooke 1979). If managed appropriately, communitarianism can work.

Third, organization theorists who defend the tradi- tional authoritarian model often point out that organi- zational members are content with that model (Locke and Sehweiger 1979, Locke et al. 1986). After all, nonmanagement employees are not agitating for radi- cal change in how organizations are governed. Maybe the employees do not want to participate in the organi- zational decision making process. For instance, 65% of Japanese employees participate in their company's sug- gestion program, but only 13% of employees do so in the United States (Kilburn 1988).

This type of counterargument against organizational communitarianism simply demonstrates the acceptance of authoritarianism as an organizational form of gover- nance within U.S. organizations. Analogous arguments are not acceptable in the nation's political and eco- nomic debates. For instance, should democracy be abandoned because less than 50% of the eligible citi- zens vote? Rather than reaching such an extremist conclusion, political scientists and politicians struggle to find ways of encouraging more citizens to vote because they believe democracy is ethically superior to other forms of governance. Hofstede (1994) provides a more constructive response by arguing that the lack of employee support for communitarian mechanisms may be a reflection of their concern about immediate physi- cal needs such as job security, safe working conditions, and adequate wages rather than a rejection of higher level psychological needs such as freedom and liberty at the workplace.

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A key obstacle in the adoption of communitarian policies and procedures is a lack of management lead- ership on the issue. America's political and economic revolutions were advocated by a power elite of wealthy property owners. They took leading roles in breaking away from unjust authoritarian English impositions on their political and economic lives. A significant number of wealthy property owners realized that it was in their interests to take certain risks in demanding their politi- cal and economic freedoms. Currently, the power elite property owners are not, for the most part, on the participatory management bandwagon. The occasional treatises written by CEOs in praise of participatory management (DePree 1989) fall far short of rallying fellow CEOs to support the right of all employees to participate in organization decisions. The rhetoric has been in the media since the 1960s, but the commitment is lacking. Until a substantial number of the power elite who currently govern American companies be- come committed to the ethical superiority of participa- tory management, its inevitability will be postponed.

Some Qualifications There are connections and spillover effects among the metasystems presented in Table 1. An overemphasis of the authoritarian model for organizations has an effect on activities in the economic and political spheres. Because subjects do not receive appropriate recourse from organizational sovereigns, they appeal to the po- litical sovereign for help. Hence, problems between sovereign and subjects within the organization are de- bated on the economic and/or political level of analy- sis where the organizational sovereigns are subject to government. The failure of organizational sovereigns to respond to the needs and interests of organizational subjects has resulted in extensive government regula- tion in such areas as union formation, prenotification of employees about plant closings, minimum wages, occupational health and safety, and discrimination.

It is important to qualify this argument on two counts. First, no dire predictions are being made about the collapse of political and economic liberty due to the prevalence of organizational authoritarianism. Rather, the comparative differences in social philo- sophical patterns give rise to claims of hypocrisy and organizational inefficiency. For example, although most managers claim that honesty, sense of humor, loyalty to fellow workers, and independence are very important features of an efficiently operated organization, those features are not always found in the companies where the managers work (Maccoby 1976). These communi- tarian goals require the reformation of organizations.

Second, the critique of organizational authoritarian- ism can be applied to all organizations, not just busi- ness organizations, although certain types such as the military may claim exemption. Political democracies suspend certain liberties on the basis of community welfare justifications, and the same logic should be true for organizations. The important point is that the standard should be democratic organizations with a few authoritarian exceptions rather than authoritarian organizations with a few participatory management exceptions.

Conclusion Debates in political and economic theory are typically framed by the tension within communitarianism and between communitarianism and libertarianism. Organi- zation theory, however, is well-grounded in authoritari- anism. Authoritarian governance processes for business organizations are typically justified on the grounds that they are essential for achieving very specific organiza- tional tasks and because business organizations operate in hostile internal and external environments. The so- cial philosophical assumptions that are rejected by the political and economic theorists for governing purposes —namely that sovereigns should dictate to subjects— are readily accepted by many organization theorists. Because wages are provided in exchange for services rendered, and employees have the liberty to enter or exit those transactions, defenders argue that authori- tarianism is a transactional advancement in work rela- tions compared with the slavery systems of Egyptian, Greek, and Roman civilizations and the feudal system of the Middle Ages. The preservation of the authoritar- ian model demonstrates that much of today's thinking about how companies should be organized and di- rected is largely attributable to the continuity of au- thoritarianism throughout much of human history. However, the changing conception of human meaning has brought into question the ability of such ancient authoritarian systems to serve human needs ade- quately.

From an organizational perspective, if companies organized on the basis of communitarian or libertarian policies and structures can be demonstrated to be as successful as authoritarian companies, these alternative models of organizational relations, which are compati- ble with widely held assumptions about human nature and governance processes, should be adopted because of ethical considerations. Like current political and economic debates, organization theory debates should consist of communitarians disagreeing on the circum-

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Stances in which managers are permitted to intervene in the life of employees, and between communitarians and libertarians who maintain that all organizational activities should be self-managed.

The communitarian and libertarian models are preferable because they are based on the essential goodness of most human beings and aim at encourag- ing personal liberty as long as the pursuit of liberty is beneficial to the larger community. This concept is at the ethical foundation of the dominant political and economic theories of the United States. It should also be at the ethical foundation of organization theory. Obviously, more theoretical and practical work needs to be done in this area of organization analysis. One path to resolving the conflict is through participatory management, a form of management control that is more consistent with the nation's dominant political and economic paradigms than the prevailing authori- tarian form. Business will not become good democratic team players, respecting the interests of parties outside the organization, until they first respect the interests of those within the organization.

Common recommendations offered by both organi- zation and business ethics theorists for addressing busi- ness ethics problems include sensitizing managers to ethical issues, training managers in ethical reasoning, and adopting codes of ethics. Each of these solutions is necessary but not sufficient. They touch on, but do not dig deeply enough into, the real ethical problem under- lying business activities. The problem is at the level of organizational relationships and it should be resolved at that level. Solutions to the current ethical paralysis between organizations and their stakeholders should include the democratization of organizations. The de- bate about organizational relationships should be among different types of communitarian models or between communitarianism and libertarianism. Only then will the patterns of relationships between organi- zational sovereigns and subjects become more congru- ent with the social philosophical assumptions of the dominant political and economic systems of the United States. Important theoretical and empirical research questions include: What are the most efficient and effective modes of participation? What modes are bet- ter in what situations? What are the obstacles to change and how can they be overcome? These types of ques- tions ought to be the framework for debate. In addi- tion, new forms of organizational systems should be developed from the communitarian and libertarian po- litical philosophies summarized in this article.

With authoritarianism the status quo for many orga- nizations and communitarian alternatives viewed as

radical changes, organization theory remains several centuries behind political theory and economic theory. In the United States, the shift from the authoritarian political and economic model entailed a military upris- ing led by a vanguard of enlightened subjects. What will it take to finally make the shift from authoritarian- ism to communitarianism in organizational gover- nance? Unions and other employee associations should take leadership roles. There is no uprising by subjects demanding participatory management but not all polit- ical paradigm shifts require a military revolt. Most recently, the shift from authoritarian to communitarian political theory in Russia was led by an enlightened sovereign. Currently, society is relying on enlightened managers such as Max DePree (1989), the chairman and CEO of Herman Miller, and organizational con- sultants such as Tom Peters, to lead the way. Business school professors try to shape the attitudes of the future CEOs in their courses, hoping their efforts will lead to particular organizational design preferences (Lewin and Stephens 1994). Managers with authoritar- ian attitudes will emphasize the "dark side" of the new organizational forms being proposed (Victor and Stephens 1994). It is therefore essential that organiza- tion theorists also play a central role in the transforma- tion. They can do so not by producing politically biased research, but by consistently reflecting on how their theories and research are related to the framework developed in Table 1 and defended in this article. Unless organization theorists develop policy recom- mendations based on the strongly held communitarian social philosophical assumptions outlined here, neces- sary changes will continue to be slow, piecemeal, ad hoc, and faddish.

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Accepted by Bart Victor, received September 1995. This paper has been with the author for one reuision.

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