Atmosphere, private ordering, and industrial pluralism: Williamson's evolving science of organization

The major contribution of Oliver Williamson, who was a 2009 Nobel Prize co-Laureate in economics, consists of proposing a heuristic analysis of governance structures, namely, the firm, the market, and what he will later call the ‘hybrid forms’. This cardinal issue in organizational economics has made it possible to propose rigorous arbitration tools for the famous ‘make or buy’ decisions in modern market economies based on asset specificity and quasi-rents. However, Williamson's work goes far beyond these contributions alone. His contribution is based on a multidisciplinary theoretical background in building the science of organization. This is the important but sometimes neglected aspect of Williamson's work that I wish to highlight in this paper in memory of Williamson in regard to three major pieces on atmosphere (and informal organization), private ordering, and industrial pluralism. In doing so, I also propose reconsidering the different stages of Williamson's evolving science of organization from recent neo-institutional works.

Análise de redes sociais informais de amizade, confiança e aprendizagem em um restaurante

Purpose – The objective of the research was to analyze informal social networks that are part of the informal organization of a restaurant, specifying relational and structural aspects of the networks of friendship, trust and learning established amongst its workers.Design/methodology/approach – The approach of Social Networks Analysis was used, which adopts as a principle the perspective that the actors and their actions are interdependent and they establish connections amongst themselves. The study counted on the participation of 24 workers from a restaurant in the city of Fortaleza-CE, Brazil, whose social networks were mapped and analyzed with the help of Ucinet and NetDraw software.Findings – As a result, it was found that informal networks are quite active in the restaurant. Their formation and functioning are part of the work culture of the informal organization, and do not necessarily have a direct association with formal positions and sectors. Informal organization assumes a certain independence from the formal structure, but not entirely, since the configuration of the friendship, trust and learning networks are associated with the dynamics of the restaurant's operation and the relevance of the activities performed by the workers.Originality/value – The research shows that the analysis of social networks allows a better understanding of the relationships established between workers, as well as the intermediated content, formation of informal groups, identification of actors who are leaders and mapping of information flows, contributing to the understanding of the informal organization of work.

The Logic of Interactive Structure

This chapter builds on the discussions in Chapter 4 about the bridging between organization design (design as a noun) and organization designing (design as a verb). Based on the key precepts of Giddens’ (1984) social theory, it is argued that the traditional notion of organizational structure can be split into the concepts of structure and structuration and that while ‘structure’ is relatively stable, ‘structuration’ is ever changing. This allows us to talk of ‘interactive structure’ as a type of structure that changes with interaction and where the emphasis is on the monitoring of interactions between human and non-human actors, by means of multiple types of traces. Thus, rather than controlling people, with interactive structure, organizations are better able to deal with the disconnect between the formal and the informal sides of organization and take full advantage of the organizational capital to be found in one of the key characteristics of informal organization, i.e. improvisation.

How to manage the development of complex organizations… and beyond

The article starts with a synthesis of traditional Theory of organization.This vision of the organization is inspired by the classical view of world, and we use to summarized this theory the “metaphor of the machine”. As gears of a machine, people are treated as systems of skills, which can be analyzed and used to achieve organizational goals. This vision is too primitive due to the fact that it is impossible to design procedures that prescribe all behaviors and measure in an absolute manner the ability of each person. People have an undeniable autonomy that make them create a so called informal organization which autonomously evolves.“To Manage” does not mean to make an organization function. Instead it means to manage the evolution process it-self. We have developed a methodology to govern the self-evolution processes of informal organizations. We present a specific case history in one of the major Italian metallurgical companies, to increase the level of safety and improve management of the human factors.

Clashing over Competition

This chapter explores a more recent example of informal cooperation: the International Competition Network (ICN). This is an informal organization that arose in the early 2000s to address global antitrust issues. It is widely viewed as successful, and functionalist theorists believe that they can explain its emergence quite well. Not so. In fact, there was considerable disagreement over whether antitrust issues are best addressed in an informal forum, like the ICN, or should be delegated to a formal organization: the World Trade Organization (WTO). This difference is somewhat puzzling for the two-step theory, because independent agencies on both sides of the Atlantic were the primary actors involved. But the chapter shows that this puzzle dissolves once one considers patterns of politicization: where politicization was greater, actors embraced formality; where it was lower, a preference for informality was maintained. Ultimately, power was essential for determining whose preference held sway.

The Move to Informality

Informal organizations are the most visible dimension of a vast informal order that has been taking shape since the 1970s and 1980s. They are, however, its least understood component. The book explores why states create these puzzling institutions and why they have grown so significantly over time and assesses what this means for states’ ability to govern cross-border issues effectively. This chapter introduces the central themes of the book and reviews the answers it offers. Specifically, this chapter explains how the book conceptualizes the idea of an informal organization, how the book accounts for the design choices of states in particular scenarios, and how the “two-step” account the book develops can be extended to offer a “dynamic” explanation of the rise of informality. The main alternative explanations are also elaborated, and the central axes of the policy debate about informality are discussed.