Organization, power and appropriateness

Johan P. Olsen began his academic career by studying municipal budgeting processes, where he was struck by the elements of ritual and symbolism in decision-making processes. Compared to conventional conceptions of rationality, these are white spots.

The Carnegie Tech school of decision-making theory, headed by Herbert Simon, had for long been engaged with imperfections and limited rationality. In making organizational choices, decision makers do not optimize, they follow standard procedures and rules of thumb. They will often accept the second best or a merely satisfactory outcome.

Olsen was concerned with the limitations of this approach in relation to understanding choices in organizations. This gave rise to an exceptional academic career in quest of a better understanding of how modern organizations function. Which are the parameters for action, and what kinds of concerns and responsibilities are involved? Today, Olsen is associated with the new institutionalism in international political science.

The Norwegian Power Study Project

He attracted widespread attention for his work on the first power study project in Norway (1972-83). Based on an extremely comprehensive mandate, involving quite breathtaking research challenges and with very limited funding, a formidable research centre was established in Bergen to focus on public administration studies. In this centre, Olsen was a driving force.

In 1976, he edited the book ‘Ambiguity and Choice in Organizations’, in collaboration with James G. March. Their life-long collaboration dates back to 1968, when Olsen went to Irvine, California, as a visiting scholar. As early as in 1972, together with Michael D. Cohen, they published the 'garbage-can model' of decisions, describing them as an outcome of temporal confluence of problems, solutions and decision-making opportunities. It became an international success, and one of the world’s most cited articles in the field of social science, including business and administration.

This laid the foundation for the comprehensive research endeavour into which the 'Olsen school' of the power study project in Norway gradually developed. It served to renew political science syllabi way beyond the confines of Norway. It is as inappropriate to speak of a unitary public administration as it is to speak of a unitary and sovereign nation-state. One can rather speak of a negotiation-state, a subdivided or segmented state.

The study called for a constitutional debate, pointing out that the Constitution only partly reflects how power is actually exercised. This debate was never entered into, however. Today, we may add, such a debate is more needed than ever before, since Norway has subjected herself to the EU by way of the EEA Agreement, which is and remains a constitutional disaster.

Books were published one after another, often twice annually. ‘Politisk organisering' (‘Political Organization’) and ‘Byråkrati og beslutninger’ (‘Bureacracy and Decisions’) came in 1978, and ‘Aksjoner og demokrati’ (‘Actions and Democracy’) and ‘Meninger og makt ‘(‘Opinions and Power’) followed in 1980. ‘Organized Democracy’ was published in 1983. Many colleagues were generously included as co-authors, and many careers were boosted by their participation in large and small projects.

In the book ‘Statsstyre og institusjonsutforming’ (‘Public Governance and Institutional Design’) published in 1988, many of these contributions were collected, and a programme for political science as an architectural science, a science of governing in competition with economics and law, was launched. Focus was placed on the use of institutional design as a political instrument. What are the effects of various forms of organization with regard to political outcomes? The book discussed the state as a supermarket, as a moral community, as a temporal order and as an organized anarchy.

To Olsen, democracy is more than just majority rule and hierarchy; it also involves civil society and its arenas for community and debate. His interest in the European university must be seen in this light. The university is part of civil society, and protects certain communal interests that are threatened by expanding markets and bureaucratic administrations. However, it has proven to be one of the most robust institutions in the history of mankind. In recent years, Olsen has studied the sociology of the Bologna process. We need to improve our understanding of stability and dynamics in this field.

A Research Entrepeneur

Olsen is a research entrepreneur who laid the foundations for his reputation through the power study project in the 1970s, but he has never been content to rest on his laurels. He has been a member of countless boards and councils, editorial boards of journals and research institutions all over Europe, and he has been a guest lecturer on all the world’s continents. From 1985 to 1990 he participated in the study of the distribution of power in Sweden, from which he published two books.

He has also been an outstanding entrepreneur in terms of establishing excellent research centers and generating knowledge relevant for public reforms, such as the Official Norwegian Report ‘En bedre organisert stat’ (‘A Better Organized State’) published in 1989. The report had a major impact on the liberalization of public enterprises. ‘Petroleum og politikk’ (‘Petroleum and Politics’) from 1989 is a book that certainly merits re-reading today.

He took the initiative to establish the Research Council of Norway’s LOS program for research on leadership, organization and management that ran from 1987 to 1996. From 1987 to 1994 he headed the LOS Center under this program in Bergen. The center focused on the study of administrative reforms, and quite a number of works that were critical of 'New Public Management' were published, long before this approach had reached Norway. International trends were conceptualized, and cross-sectoral analyses became their hallmark.

He has retained his fascination for bureaucracy as a form of organization. In a recent article, he points out that bureaucracy has had its ups and downs, but currently appears to be undergoing a renaissance. With Max Weber, we may add that it is an unrivalled organizational principle, in light of which all other principles appear amateurish.

In 1989 he published his most famous book, ‘Rediscovering Institutions’, which was co-written with March and later translated into several languages. Its basic idea was formulated in an article on new institutionalism in 1984, which came in sixth place in a ranking of the most important articles of the century made by American Political Science Review. The article formulated the idea of the logic of appropriateness, introducing political and normative elements into the theory of organizational choice more explicitly. Roles, rules, routines, awareness management and establishment of identity are keywords.

In the social sciences, institutionalism can mean a number of different things. There are economic as well as sociological-historical approaches to institutional analysis. The defining feature of new institutionalism as propounded by March and Olsen is their explicit focus on mechanisms that can explain why the actors neither invariably act in a manner that maximizes utility, nor are slavishly ruled by norms. They will not always adhere to cost-benefit logic. In this sense, history is not efficient.

March and Olsen assume that actions are intended, but not exclusively voluntaristic. Social actions imply a regard for the responsibilities inherent in a role and an ability to determine the imperatives defined by a certain position. As the authors state, actions are more often driven by necessity than by preference. A responsible person is one who is in agreement with himself and his identity, and who is able to maintain consistency between his actions and his notion of himself in a social role.

Actors are not only driven by self-interest, but also by a desire for self-respect and decency. In a deliberative perspective, we would say that institutions and collective identities provide the actors with grounds to act in opposition to their self-interest. Thereby, the white spots with regard to rationality in organizational analysis, referred to above, may already have taken on some color.

Through the 1990s the neo-institutional perspective gave rise to several works, with new collaboration partners. In 1995 the sequel to 'Rediscovering Institutions' was published, 'Democratic Governance', co-written with March. The ability of political institutions to create solidarity, identities, power and accountability was in focus. To Olsen, ‘governance’ denotes authoritative political rule, rather than the network-type administration that we currently associate with this concept.

The Experiment Without a Precedent

But then we have the matter of the European Union (EU), this experiment without a precedent. For the first time in human history we are witnessing the formation of a political order which has not been established through war and brutality. This represents an explanation problem not only for conventional political science, but also for sociology. In these sciences, the basic concepts related to the preconditions for social and political order were largely derived from the study of nation-building processes. The European integration process challenges a number of time-honoured theories on the preconditions for political integration.

In 1994, ARENA (now ARENA - Centre for European Studies at the University of Oslo) was established in Oslo. This institution developed into a robust centre with an inter-disciplinary staff and a unified research theme. Olsen actively sought out collaborators from other disciplines, and historians, lawyers and philosophers were all seated at the same table. Political science was to be brought closer to its continental roots. It turned out to be an interesting construction. In the regular Tuesday seminars everybody became involved in a critical examination of research results.

Olsen’s productivity did not abate during the ARENA years, and what could be more natural than asking him to write the opening article for Cambridge University’s new journal European Political Science Review. In 2006, he published the monograph 'Europe in Search of Political Order', in which many of his contributions to European studies were collected.

Olsen would claim that even though the EU has no precedent it perpetuates the tradition of governing found at the national level. The co-existence of old and new orders is the defining characteristic of the EU’s multi-level system. Olsen demonstrates how practices from the nation-state are being widely copied, and points to the strength of the European political institutions within this process of transformation. The problems of democracy are identified in the absence of a common political identification – in the deficient political construction of common goals, conceptions and identities. This is derived from the fact that democracy, as noted above, cannot merely be conceived of as a technical, formal arrangement to summarize preferences and convert them into practical actions: it is also a value system based on relationships of trust and civic spirit.

The problems inherent in creating unity within the wide span of European diversity and in rallying popular support are currently restricting this project. Institutions are not only expressions of successful adaptations, they also reflect deeply felt loyalties and obligations. To Olsen, institutions are ‘living’ and lived. It is therefore difficult to imagine that the European process of integration will be able to continue at the financial and administrative level if it fails to find its way into the hearts and minds of citizens. In his recent book ‘Governing Through Institution Building’ published by Oxford University Press in 2010, Olsen develops this idea further.

The institutional perspective provides some explanations as to why ‘grand design’ fails to work. Institutions cannot be chosen freely, they act in an integrating manner only for as long as they remain embedded in social practices and accord with the citizens’ sense of justice. Institutions establish order and permanence, and under certain conditions they also give rise to change.

The EU is an innovation, and can be regarded as a response to the challenges facing the European nations. A form of European integration is necessary for functional reasons, because of increasing interdependencies and trans-boundary problems. However, the EU also has a normative goal, having being established in order to prevent new disasters. It is constituted on the basis of certain principles, norms and values, and possesses institutions and procedures that constrain the will of governments, thus invoking a ‘logic of appropriateness’.

The EU is an agent of change with a global reach that defines new requirements and opportunities for action for its members. From a historical point of view the European-level institutions have demonstrated a pronounced dynamism. However, it remains unclear how we should conceptualize the European project. Olsen has been working with some of the most pressing scientific and political problems that we face.

We look forward to seeing the works that are yet to come!