Critical theory sets out to critically examine organisations in contemporary society. This approach has emerged from the radical humanist paradigm (Morgan, 1995, Burrell, 2000). This approach argues that a positivist (functionalist/modernist) approach to the management of organizations if not utilised cautiously it may result in the dehumanisation of the employee and the workplace. Individuals are generally seen as machines and work as a technical process (Robbins and Barnwell, 2006, pp. 21-22). It is the humanist approach that focuses on placing people first rather than those of the organisation. It also argues that organisations need to be ethical and humane. Unfortunately, these ideals are not always pursued by organisations.
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A critical approach sets out to improve the practices and traditions of the positivist/functionalist approach to management. For example, a critical perspective sees work as the problem rather than the positivist view of the worker as the problem. However, critical theorists are not focused on removing the system but rather prefer to improve it through raising awareness, critical reflection and self analysis (Robbins and Barnwell, 2006, p. 22).
After completing this module/topic, you should be able to
- Outline and analyse the basic assumptions of the radical humanist paradigm.
- Outline the various critical theories and analyse the implications they have for managing organisations.
- Analyse the basis of and the need for an ethical approach to managing organisations
- Analyse the link between critical theory and the radical humanist paradigm
- Define and explain the concept of ‘alienation’ and its implications for organisations
- Develop an understanding of the radical humanist concept of power
- Critically evaluate the concept of ‘ideological trap’
- Explain and analyse issues such as diversity, equity and fairness in organisations
Critical theory has its origins in the Radical Humanist Paradigm (see Crowther and Green, Chapter 9 on E.Reserve). This approach questions the current accepted views of organisations and their impact on society. Previous examples of now outdated views that would not be accepted today would include ideas such as, women should not be encouraged to work and that organisations can freely pollute the environment.
The basic assumptions of this paradigm are according to Morgan (1995),
- Ideological traps: – Tunnel vision is based on our previous experience becoming the blueprint for interpreting our current experience (we often let myths and our past experience becomes our reality). We are unable to interpret reality without prejudice.
- Power dimension: – The right to define reality or the right of some to have power over others – overt use of power. Power is also used in a subtle or covert way (soft domination) and its use and abuse is often unquestioned. Eg. How is power distributed in organisations? We discuss empowerment and participation but we rarely see this happening in organisations.
- Ethical dimension: – Organisations need to act in an ethical manner. How do the actions of managers and organisations impact on employees and society?
- People first – Work is the problem
Critical theory proposes that the functionalist approach to management is based on a technical and mechanistic view of organizations rather than understanding organizations as social and human activity. This technical view of organizations reinforces the view that managing organizations can be achieved by developing more efficient and effective technical control (Alvesson and Willmott, 1996). However, the focus on efficiency and effectiveness may overlook the needs of people in organisations. The use of control in organisation may become authoritarian if not carefully monitored.
A critical approach is often viewed as being negative; however, a critical approach is important skill to develop. A critical approach means that we do not take things at face value and question the current way things are done. Contemporary social movements such as environmentalism, feminism and consumer issues often take a critical approach because they question the current belief systems and practices in society and organisations (Crowther and Green, 2004, p. 115).
Conflict: Questioning may give rise to conflict but this does not necessarily mean that the conflict needs to be dysfunctional. Critical theory is clear that any conflict should be dealt within the system and in democracies this is done through political debate, academic debate, education, legislation, Television (Australian Story – ABC; 7.30 Report, ABC), Documentaries (Who Killed the Electric Car: An Inconvenient Truth), Films (see Erin Brockevich; The Devil Wore Prada) and good journalism (eg. Financial Review; Washington Post; The Economist; The Observer; New Scientist; Business Week). Functionalist theories focus on unifying different ideas and blending peoples ideas into one view of the world. While this idea has merit, taken to its extreme it can result in the demise of the company eg. One Tel and Enron and others. So some conflict, questioning and critique is important in order to ensure that organisations do not descend into group think (see module 6).
An example of a critical approach that has been viewed as negative until recently has been the environmental movement. This movement has been seen by business and governments to be overly negative toward business and in particular energy organisations. However, the scientific support (Stern Review and the Report by the United Nations) is so strong that people now take this movement seriously. Therefore organisations need to examine the implications that climate change may have for their business otherwise they may not survive in the long term. In addition a critical approach recognises that there are different and shifting realities and that the interpretation of the issue should be considered within the framework of the context in which it occurs (Crowther and Green, 2004, p. 118).
A critical approach (Radical Humanism) consists of many theories that were developed to critique the excesses of the capitalist/business world. Theorists include the Frankfurt school who argued that the over use of technology may prove to dehumanise the workplace. Other critical theorists include;
Marcuse argued that consumerism was becoming a problem for society and people were becoming ‘one dimensional’. In other words individuals did not question whether they needed to consume but rather they consumed unquestioningly, for example buying bigger cars when oil supplies are diminishing and the problems associated with global warming (The West Australian, 2007). He argued that the creation of ‘false needs’ that serves to keep people happy and working long hours and in difficult conditions (cited in Burrell and Morgan, 1988, p. 293-294). An important aspect of this theory is the unquestioning acceptance of technology.
Habermas argues that work is the dominant form of social action in society. Habermas also suggests that work is a form of communicative distortion because the power relationships in organisations are not equal. Organisational structures do not enable the empowerment of individuals so that they can be free to communicate so that genuine consensus can occur. An ‘ideal speech’ situation is one where dialogue is open and not influenced by those who are more powerful (Burrell and Morgan, 1988, pp. 294-295; Crowther and Green, 2004, p. 121). An example of this would be the ‘One Tel’ situation where employees could not discuss the organisations problems with Jodee Rich because he did not want to hear bad news (Robbins and Barnwell, 2006).
Habermas proposes that there a three main issues that need to be addressed to ensure empowerment. They are:
- Technical Reason: the value given to science and technology has taken precedence over human and ethical issues. Control is the main aim with the ends being more important that the way things are done.
- Practical Reason: this concept refers to the importance of achieving mutual understanding instead of focusing on prediction and control. The means are as important as the goal. The needs of employees and society should be taken into account.
- Emancipatory reason: communication needs to focus on consensus and be conducted in a climate free from domination. Critical self reflection is important. That is individuals must question their own ideas and values. This self questioning enables the development of critical thinking and frees individuals from past practices (ideological traps) which may not be relevant for the present or the future (Crowther and Green, 2004, pp. 121-122).
Critical theorists agree with the interpretivists that assumptions and beliefs are taken for granted by people. However, although they share the idea that organisational life should be explored from a subjective, they prefer to question these beliefs rather than just understand them. Therefore a critical approach is more concerned with developing a questioning and critical approach to organisational life. Journalists, lawyers and researchers are trained in this approach. Academic training focuses on questioning and extending knowledge rather than accepting the status quo. A good example of this focus on questioning are Barry Marshall and Robin Warren who are from Western Australia and received the ‘Nobel Prize” for their work on ulcers in 2005 and made Companions of the Order of Australia in 2007. Their findings challenged the prevailing beliefs and assumptions that ulcers were caused by stress. They found that ulcers were caused by bacteria could be cured by antibiotics. However, the consultant specialists in the field were unimpressed and it took Ten years before they were listened to and almost 20 years before their findings were accepted by the medical establishment and business (Knowles, 2007).
Another group that have challenged conventional wisdom have been the environmentalists. Our headlines now are raising the issue of climate and its impact on society (Hartcher, 2007; Stern Report) scientists now are in agreement that climate change has the capacity to severely impact life on earth as we know it is still seen by business as not a major issue. Although the Stern Report (commissioned by the British Government) concluded that climate change is the consequence of the greatest market failure and called for business to take action to control greenhouse emissions, American CEOs were far less concerned about climate change than the Europeans (Kitney, 2007, p. 40).
Critical thinking is concerned with the development of foresight and learning (Fulop, 1992). Organisations and society cannot always wait until the problem has been experienced objectively because by the time we experience the event it may too late to rectify the situation. The lack of a Tsunami warning system in the Indian ocean was an example of this problem. Scientists had been warning for many years that a warning system was needed. Many lives and businesses were lost as a result of the Tsunami.
Without critical thinking we cannot have innovation and change. Change requires questioning what we are doing currently and if it can be done better. The radical humanist concept ‘ideological trap’ illustrates how people can become trapped in a non-reflective and unquestioning way of thinking.
Stop and Consider: Why should people and society question current thinking? Can you outline any examples of ‘ideological traps’ Business leaders have that need to be challenged to ensure a focus on the human side of organisations?
A critical approach to organisations: Placing people first
Critical theory proposes that organisations should be concerned with the emancipation and empowerment of employees in organizations. Critical theory also recognises that the placing of people first is not always the primary concern of organisations. For example, although organisations argue they foster empowerment, there is evidence that employees are working longer hours and extreme jobs are becoming the norm (Hewlett and Buck Luce, 2007).
If employees are over controlled then organizations face the prospects of employees experiencing alienation. Alienation results in employees experiencing low motivation, low morale, poor mental health, job dissatisfaction, job stress, anxiety and depression (Kanungo, 1992). Work alienation is defined as ‘an experienced psychological state of the individual that represents a cognitive separation from one’s job and other work contexts; a sense of frustration and accompanying negative affect, that is the result of the worker’s perception that they have failed to achieve their objectives through their job, and results in the experience of apathy (Kanungo, 1992, p. 414).
Empowerment is considered by critical theorists to be a way of overcoming alienation. Empowerment involves giving the worker more control over their work by participating in decision-making. In addition it involves giving the worker encouragement, and to provide workers with meaningful goals. According to Kanungo (1992) empowerment has an ethical foundation and goes beyond the focus on the bottom line. Thus Kanungo (1992) argues that organisational ethics begins with the humane treatment of workers.
The central tension in organisations is often between resistance and obedience. Management control excessive use of coercion invites overt resistance because is used in an obvious manner. However, power as a form of control can also be used in a more subtle way.
According to Courpasson soft domination is characterised by the administration of rule that give managerial discretion to managers while reinforcing the strength of centralised authority. It is based on the appearance of equality and fairness but ultimately in organisations the power lies with only a few (Cited in Clegg, Kornberger and Pitsis, 2005, p. 169). Processes such as performance appraisals, promotion systems, discipline procedures and being made redundant all contribute to feelings of powerlessness and that others have the right to define the worker’s reality.
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Teamwork is often seen associated with the rhetoric of empowerment but it can be a form of soft domination. Single solutions such as TQM, Lean production, Learning organisations, and BPR appear to reverse the individualistic approach of Scientific Management. Teamwork and in particular self managing teams does not isolate workers and set them competitively against each other. In contrast to scientific management teamwork encourages communication and sociability among workers. However, Barker notes that it is a form of ‘concertive control’ because the team members watch over each other because the responsibility for rule making is shifted to the team who then set their own limits.
It is more difficult to argue with team members than it is to argue with a supervisor. The subtlety of ‘concertive control’ is powerful and very difficult to escape (Cited in Clegg, Kornberger and Pitsis (2005, p. 172-174). Concertive control has the capacity to promote the notion of overwork and extreme jobs because people feel they cannot take time off such as a sick day because they will let others down.
A study by Deery, Iverson and Walsh (2002) studied five call centres (480 telephone service operators) in the communications industry has show that the use of teams alone cannot overcome problems in the workplace. The study also showed that elements of scientific management contributed to worker exhaustion. These researchers carried out a well designed study and used good quality scales of measurement and analysis. Workers in this industry are often subject to customer hostility and verbal abuse. Workers were measured on employee withdrawal, emotional exhaustion, customer interactions and scripted conversational rules. Workload items included were the pace of work, role overload, and routinisation of work, team leader support and physical health. They found that customer abuse along with scripted and rigid rules of response also contributed to emotional exhaustion. Workers experience exhaustion because although the scripted approach facilitates a more efficient approach to the customer, less time is spent with them so that workers can deal with more calls. Consequently customers feel that they are not important and often become abusive. This streamlined approach is based on Taylor’s scientific management principles. However, it only serves to dehumanise the worker and irritate the customer. The researchers initially thought that the longer a person stayed with the organisation they would become more competent and therefore less likely to experience exhaustion. However, this was not the case. The longer workers stayed the more they were likely to experience emotional exhaustion. Emotional exhaustion was also associated with withdrawal (levels of absence). Withdrawal was related to a high workload and customer abuse. The symptoms of withdrawal and emotional exhaustion are linked to the concept of ‘alienation’.
A critical approach: Are organisations ethical?
A critical approach argues that organisations should have an ethical approach when conducting their business. This means dealing with their employees, clients, society and other business associates in an ethical manner. This contrasts with the functionalist theories that are concerned with efficiency and effectiveness. Functionalist theories focus on survival and profits. Now these are important for without organisations the majority of people would not be able work and survive. However, if organisations only focus on their own interests then the ramifications may ultimately be detrimental for their survival and lose the good will of the community. The pursuit of efficiency and effectiveness may become an ideological trap (tunnel vision) that prevents organisations from seeing the bigger picture.
Activity: Read James Hardie – from fibro in suburbia to mesothelioma and the US siding market in Robbins and Barnwell (2006, p.254).
The focus on organisational success in terms of profits etc can lead an organisation and its management to develop tunnel vision (ideological trap) which stops them from considering ethical issues and how society views its actions.
The idea of unquestioned obedience needs to be explored. The question ‘why do people do morally bad things whey they are asked to do so by those in authority? What aspects of organisational life make unquestioning obedience occur? The technique of power, i.e. the right to define reality enables leaders to ask people to do things they would not normally do. Therefore if employees are authorised to do something then it takes away the responsibility for questioning their leader. Milgram (cited in Clegg et al., 2005, p. 181-182) showed how easily this could be done. He found that individuals are inclined to follow the commands of people who are in authority. He created an experiment where ordinary people were directed by scientists to do cruel things to other people (participants) as part of a laboratory experiment. When the individuals were instructed to deliver electric shocks to the participants they did so (however, they did not know that the shocks were not real and the participants were actors). The individuals believed that each shock they gave was higher than the previous one. If the individuals could see the participants only 30% administered the shock if they, however, if they could not see the participant then 62% were willing to administer the shock. Milgram showed that the obligations of the situation were stronger than the individual’s ethical and moral values.
Milgram also found that when the expert was questioned then individuals were less likely to follow instructions unquestioningly
If organisations do not empower employees to speak up and contradict ideas and thinking, then CEOs will not be exposed to different perspectives and/or limit the probability of unethical behaviour in organisations. Therefore it is easy to regard the person speaking against the issue to be incompetent, a trouble maker and/or a whistleblower. In module five it was noted that the functionalist to culture focused on developing a single corporate culture. However, a critical approach would argue that this may lead to an organisations downfall if taken to the extreme (One Tel, Enron) or experience major problems such as James Hardie (Robson, 2007; Robbins and Barnwell, 2006, p. 254).
The power of the organisation to facilitate organisational commitment and loyalty has advantages and disadvantages. A study by Ahern and McDonald (2002) found that nurses who were more traditional in their behaviour and deferred to the surgeon and others in authority in a hospital were less likely to report misconduct. However, nurses who were committed to their profession and the nursing code of ethics tended to report misconduct because they were advocates for their patients. Traditional nurses felt powerless to alter the status quo were restricted in their moral and ethical development. Nurses who believed they were advocates for the patient were more likely to blow the whistle in hospitals. These results are not good for either the patients or the organisation because patients like to think their life and health is placed first. In contrast organisations such as hospitals would prefer to have undivided loyalty and that the problem be dealt within the organisation rather than reading about it in the newspaper.
Ethical issues such as insider trading have created difficulties for organisations and their shareholders. It is difficult to prove; however, in 2002 the burden of proof was lowered with the introduction of civil penalties. One of the recent cases involved Steve Vizard who was fined $390, 000 and banned from managing a corporation for more than 10 years. (Johnston, 2007, p. 32). Johnston (2007) also draws attention to other Australians and overseas people who have been prosecuted for insider trading. The Australian Securities Investment Commission (ASIC) is a corporate watchdog that oversees companies to ensure they abide by Australian company laws. The legal system attempts to ensure that corrupt and unethical behaviour does not occur in organisations, however, the legal framework, cannot ensure businesses are ethical and moral. For example, large mining companies now accept that closing a mine is not just walking away from a ravaged landscape. Closing a mine is now an environmental and sustainable process (Mellish, 2007).
Legislation and public sector organisations in Australia attempt to ensure that employee and community safety is ensured, that minorities are treated fairly and that the environment is not compromised. Until recently Australia had one of the best legal systems in the world for ensuring the workplace treated workers fairly. The new ‘Work Choices’ legislation, according the Professor of Law at Sydney University is now comparable with the US and Australians will find that their jobs in the future will be less secure and less well paid (Mccallum, 2007).
An ethical approach: Diversity in organisations
A critical approach to organizations also examines the decisions and practices of organizations for their ethical approach. It challenges the notion that management is a scientific and impartial process. The pursuit of gender equity in organizations is a humanist and ethical approach to organizations. For many years women in organizations were not given equal pay for equal work. The view that women should receive less pay than men was an outcome of the historic industrial wage decision by Justice Higgins in the Harvester Judgement in 1907. Justice Higgins determined what was needed by a man to support his wife and children at a reasonable standard of comfort. It was also argued that women should receive 54% of the male wage because she only had to support herself and/or supplement her husband’s salary. Society’s values supported this approach and the unequal pay and unfair treatment of women at work continued until 1972.
Married women usually had to resign their positions on marriage and married women were not allowed to join the Public Service until 1966. Following the introduction of the Equal Employment Opportunity Act in the states of Australia the workforce was generally gender segregated.
However, there are still very few women in senior management positions in large organizations and fewer women directors of Australian Companies. Barriers to women’s progression in organizations occur through social and organizational practices and the final barrier to senior position is called the ‘glass ceiling’ (Robbins and Barnwell, 2006).
Learning Activity: Read pages 501 to 512 in Robbins and Barnwell (2006) and outline the different barriers that inhibit women’s progression in the workplace. What does the ‘glass ceiling’ mean? Do question three on page 528 of your text.
A critical approach by women and men has questioned the early ideas of women and work and enshrined a fair go for both women and minority groups into legislation. The main feminist theories that emerge from critical theory are Radical Feminist Theory, Psychoanalytic Theory and Anti-capitalist feminist theories (see table 16.1 in Robbins and Barnwell, 2006, p. 516). These theories explore the reasons for the unfair and discriminatory treatment of women. In 1986 Federal legislation was introduced to ensure that women were treated fairly at work was the introduction of the Affirmative Action (Equal Opportunity for Women) Act 1986. The Act specified a number of provisions that organizations must meet to fulfil the requirements of the Act (Robbins and Barnwell, 2006, p. 522).
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