Interdependence and Informal Control in Organizations

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Interdependence and Informal Control in
Organizations

• Rafael Wittek
• January 2006

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• Effective social control requires unambiguous
  relational signals.

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Program

• Case Study A German Paper Factory
• Analytical Framework Relational Signaling Theory
• Empirical Evidence
• Conclusion

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Case StudyA German Paper Factory
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The Setting
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Research Site
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Organizational Context

• Paper Factory in Southern Germany
• Medium size firm, 180 employees
• Bought by multinational after bankrupcy in 1993

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Organizational Context

• Extended Management Team
• 20 experienced paper engineers
• most team members work together for 10-20 years
• Strong ingroup identity
• Changes in hierarchical structure

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Organizational Context

• Project
• Construction of a new production hall, deadline
  1.9.1995
• Move of third paper machine from closed plant in
  Munich
• Integrate new colleagues into the team
• Highly visible within industry, high stakes

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Research Design

• Participant observation
• Trouble case method
• Organizational context
• Sociometric panel study
• Trust relations
• Triad census
• Vignette Study

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Social Control in a Paper Factory
n 67 trouble cases
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Escalation of Social Control

• Social Escalation increasing number of actors
  involved in social control process
• Passive (unilateral) Avoidance
• Direct (bilateral) Peer pressure
• Indirect (trilateral, horizontal) Gossip
• Formal (trilateral, vertical) Snitching
• Public (multilateral) Trial

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The Puzzle

• Why is there so much variation in control
  behavior through time?
• What caused informal control to break down in
  1996?

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Analytical FrameworkRelational Signaling Theory
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Relational Signaling

• Individuals strive for social well-being
• E.g. Paper engineers professional prestige
• Social relations essential for production of
  well-being
• E.g. respect paid by colleagues
• Relational signals key for creation and
  maintenance of social relationships
• Positive signals indicate willingness to
  maintain mutually rewarding social relation
• Strong solidarity signals primacy of group over
  bilateral relation and gain seeking
• Weak solidarity signals primacy of gain seeking
  tempered by concern for maintenance of bilateral
  relation
• Negative signals indicate disinterest in
  maintaining relation, or attemt to harm social
  well-being of ego
• Ambiguous signalsdegree of alters interest in
  maintaining mutually rewarding relation unclear
• Source a.o.
• Lindenberg, S. 1998. Solidarity Its
  Microfoundations and Macrodependence. In
  Doreian, P. and Fararo, T. The Problem of
  Solidarity. Gordon and Breach.

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Types of Interdependence

• Unambiguous relational signals require alignment
  between three types of interdependence
• Functional Interdependence
• Common goal, tasks, division of labor
• Structural Interdependence
• Social relation in dyad is affected by or affects
  relation to third parties
• Cognitive Interdependence
• Shared beliefs, vaues
• Source
• Lindenberg, S. 1997. Grounding Groups in
  Theory. Advances in Group Processes 14

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Descriptive pirical Evidence
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Functional Interdependence
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Changes in Formal Structure
Task Interdependence
1997
-
Outcome Interde-pendence
1996
1995
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Structural Interdependence
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Changes in Informal Structure
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Cognitive Interdependence
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Changes in Formal and Informal Interdependence
Summary
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Changes in Formal Interdependence
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Changes in Informal Interdependence
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Empirical Evidence Effects of (Changes in)
Formal and Informal Interdependence on Social
Escalation
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Summary of Hypotheses

• Functional Interdependence
• Grievance severity increases escalation
• Structural Interdependence
• Personal ties decrease escalation
• Network embeddedness increases escalation
• Cognitive Interdependence
• Decay of solidarity frame increases escalation

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Effects of Functional Interdependence

• Strong, repeated grievances elicit highest level
  of social escalation
• Based on vignette study (n1824 stacked
  observations 19 respondents, 8 vignettes, 12
  control strategies)

Effects of Grievance Severity and Frequency on
Escalation
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Effects of Structural Interdependenceon Social
Escalation
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Measurement of Structural Interdependence

• Triad census
• number of trust relationships
• Number of coalition triads
• Informal power advantage in trust network

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Structural Embeddedness
Hole
Closure
Positive tie
Negative tie
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Power Advantage Alter
Power Advantage Ego
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Structural Interdependence and Social Escalation
Results

• The more strong ties an individual has, the
  higher the level of social escalation
• The higher the number of informal coalitions an
  individual is embedded in, the higher the level
  of escalation
• Based on Trouble Case Analysis, n67 trouble
  cases

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Effects of Cognitive Interdependenceon Social
Escalation
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Measurement of Cognitive Interdependence

• Number of Frame Stabilizing Activities
  Frequency and inclusiveness of Meetings (MT,
  Department, Project)
• High in 1995
• Intermediate in 1996
• Low in 1997

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Effects of Changing Interdependencies Results

• Effect of coalitions and strong ties on social
  escalation disappears through time
• Decay of solidarity frame through time increases
  escalation

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Summary of Hypotheses
Solidarity Hypothesis
Destabilization Hypotheses
Decreasing frame stabilizing activities
Frame Decay Hypothesis
Informal power advantage
Informal power hypothesis
negative effect
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Summary

• Social control as social escalation
• Group processes driven by three types of
  interdependence
• Cognitive interdependence crucial moderator of
  the effect of functional and structural
  interdependence
• frame decay results in sanctions becoming
  ambiguous relational signals
• (de)escalating effect of ties and networks
  decreases over time

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Conclusion

• Effective de-escalating informal control rests on
  unambiguous relational signals
• Relational signaling requires
• Solidarity frame stabilizing activities
• Balance of informal power
• Network of personal ties