COMFORTING LIE #7

7.    Hierarchy is an ethically acceptable organizational structure.

To understand what this means and why it is fallacious we must examine the definitions of “hierarchy” and “bureaucracy”.

The vast majority of organizations in the world today utilize the well-known pyramid-shaped communication structure that we call a hierarchy.  Typically the top of the structure is a board of directors headed by a chairperson who is the ultimate authority in all matters that concern the organization.  The chairperson of the board is usually a major shareholder if the organization is a corporation, and the board members as a group often collectively own a controlling interest in the corporation.

The board of directors recruits, selects, and hires a Chief Executive Officer (CEO) who is often given the title, “President”, and who may or may not be a member of the board.  The board of directors determine the overall policies that are implemented by the CEO, but do not get visibly involved in the day-to-day decisions that are delegated to the CEO.  This chore is delegated to the CEO.  One reason for this arrangement is the fact that it insulates the board members, for the most part, from liability if the company does something later judged to be illegal.  Although there have been exceptions, the buck usually stops with the CEO if the company is found guilty of a serious crime.  For less serious crimes the buck will stop at some lower level of the organization.  Whoever is blamed publicly for the problem becomes the “patsy”, who is fired for cause and leaves the company in disgrace.  This fate almost never befalls anyone above the level of CEO.

So from the outset we see that the company is structured in such a way that the ultimate decision makers, who in fact give the CEO his orders, are not held accountable for the organization’s misdeeds.  This internal culture is perpetuated within the organization through sequential recruitment and the trickle-down delegation of authority.

We have no problem with sequential recruitment; in fact it is a very useful and generally ethical tool, employed in the formation of an organization.  It is a rare organization in which a new person is hired without the approval of the individual who will supervise the new employee or member.  Why critics of multilevel marketing and other network organizations take umbrage with sequential recruitment is a mystery we have yet to solve.

The potentially problematic aspect of hierarchies is the vesting of authority and its sequential delegation from the top down.  While this is a very effective means of power-brokerage, it leaves much to be desired when it comes to ethics.  Let’s go back to our example of the typical corporate structure.  The CEO hires some Vice Presidents who hire some managers who hire some supervisors who in turn hire the creative talent whose efforts will ultimately determine the financial success or failure of the enterprise as a whole.  Make no mistake; the prosperity and well-being of any organization is always derived from the creativity of its participants; and in hierarchic organizations the most creative people are often among the lowest paid persons with the least authority.  Only the secretaries, clerks, janitors, and support staff fall lower in the organization.  Even the sales people are better paid and more highly regarded than the creative thinkers who make the enterprise viable.

Now let’s look within such an organization, where we find someone called C working for someone called B who reports to someone called A.  Within the constraints set by higher levels of management, A tells B what work to do, where and when to do it, what to wear on the job, what hours to work, how much vacation is permitted, and how much time B may spend each day for lunch, potty breaks and so forth.  By determining B’s pay-rate A also determines B’s off-the job lifestyle, including what kind of car B can drive, what kind of house B can afford, what kind of vacations B can take, what kind of schools B’s children can attend, etc.  In return for these blessings, B does all the same things for C.

Clearly, A’s relationship with B is very similar to B’s relationship with C.  It is this standardized relationship, repeated with minor variations throughout the organization that is referred to as the “culture” of the organization in the field of organizational development.

An important feature of this culture is the fact that C’s opportunities for advancement within the organization are generally somewhat limited.  In most cases, for C to advance to B’s level, B must vacate his position by dying, retiring, quitting, being fired, or being promoted into A’s position.  As in other things, this chain of opportunity usually ends with the CEO, who is generally hired from outside the organization rather than selected by promotion from within.  The opportunities for C are further limited by the fact that at each level there are fewer positions than there are at each of the levels below.

Now superimpose on this culture the fact that the board of directors has structured the organization in such a way as to minimize its members’ personal accountability and liability.  This part of the culture is also reproduced at each level.  Lacking substantial opportunities for personal advancement, it becomes the primary objective of participants at each level to avoid the disfavor of those at higher levels, along with the penalties and punishments that those at higher levels can inflict.

Most of the time the result of these circumstances is that B tries to curry favor with A by taking credit for C’s achievements and by blaming C for any failures on B’s part.  In this way the “patsy” dynamic is promulgated and perpetuated from the board on down.  The upshot is that B is, in a very real way, in competition with both A and C.  This creates highly destructive interpersonal dynamics throughout the organization.

The most harmful aspect of the typical hierarchic culture is its effect on communication between levels.  In many organizations it is forbidden, under the most severe penalties, for C to even talk to A unless B has carefully scripted the conversation in advance.  These strictures, and others of similar effect, essentially destroy the corrective feedback on which the success of the organization depends. It is this systematic elimination, destruction, or avoidance of corrective feedback that we label and refer to as bureaucracy.   In the absence of bureaucracy C could go to B, or even to A, and say, “Look!  We seem to be doing something wrong, something unethical, maybe even illegal”, and be rewarded for delivering this valuable feedback to those with the authority to correct the situation.

But in a bureaucracy such a message will label C as a “trouble-maker” or a “whistle-blower” and C will be promptly fired for “insubordination” or “acting outside the chain of command”.  Others within the organization will be careful not to repeat C’s error; and the veil of bureaucratic secrecy will become ever more opaque.

In similar fashion C could, in a non-bureaucratic organization, turn to B for help in becoming more competent on the job.  But in a bureaucracy such an admission of weakness on C’s part is tantamount to failure; so C cannot get needed corrective feedback from B, the person who stands to gain the most from C’s success.  It is for this reason, largely, that participants in a bureaucracy eventually rise to their “level of incompetence”.  What a situation!  What a mess!  It is easy to see how participation in a bureaucracy can convince one that life is a zero sum game (the Zero Sum Fallacy) or that unethical means can achieve ethical ends (the Unethical Means Fallacy).  After all, these fallacies appear congruent with the perceived success of higher level personnel in a bureaucratic environment.  From these facts we draw the conclusion, by the application of simple logic, that bureaucracy is unethical and that hierarchies that do not scrupulously guard against it are inevitably likely to succumb to its evil effects.