Blog 4: Team Structure

The most successful team I have been a part of has been the Leadership division of my service fraternity, Alpha Phi Omega (APO). APO is a service organization dedicated to developing the community service and leadership skills of its members while also fostering camaraderie and fellowship among the members. The Leadership division of my fraternity is dedicated to developing members' leadership, communication, and teamwork skills through events such as business communication workshops, lessons on how to build a professional "brand", and lessons on how to lead diverse teams of people. The entire organization is led by a President, with Vice Presidents just under her that each head a different branch of the organization. Each VP has a head director that reports directly to them, and the head director is, in turn, in charge of the various other directors and chairs that make up the other officer positions of the branch. Those other directors and chairs are usually in charge of regular committee members. Each committee is made up of three to ten people. Guidelines and overall directives for the branch are passed down from the President to the VP, who passes those directives on to the head director of the branch just under them. That head director then decides what events should be put on, and specifies those events to the other directors and chairs. Those directors and chairs are then in charge of actually putting those events together with the help of their committee members. The committee members and directors other than the head director can best be thought of as the "boots on the ground" in this scenario. I was the Professional Development Director last semester, which was a director position in the Leadership branch. While other Directors may have handled their position and interacted with their committee differently, here I will focus on the organization from my perspective and how I interacted with my committee.

From the President down to my position as Professional Development Director, APO's organizational structure could best be described as similar to the simple hierarchy described in the text. The other directors and chairs in the Leadership branch report to the Head Leadership Director, who reports to the Leadership VP, who reports to the President. This structure frees the VP from having to focus on day-to-day operational matters to instead focus on the division's relationship with the President and the rest of the chapter. While this structure is efficient, it is not without its downsides. The directors and chairs other than the Head Leadership Director tend to have little access to their VP and President, with committee members having almost no access. From my Professional Development Director position to my committee members, however, our organization structure could be best described as an all-channel network. During my last semester, I exercised little authority over my committee members, preferring to allow them to volunteer for the duties they were interested in, and allowing them to make decisions and work among themselves as they saw fit. Information flowed freely among us, and my leadership position was mostly a formality. For example, during the planning for the etiquette lunch my committee put on, in which we invited other members to a lunch where there would be a presentation on mealtime etiquette followed by a chance to practice that etiquette over real food, our duties were dynamic and self-decided. One committee member took charge of writing the part of the presentation on handling silverware, while another member took charge of the part on proper mealtime conversation and dress. Another member took charge of procuring cups and plates for the event, while I took charge of procuring food. Information flowed freely among us so we could bounce ideas off each other. While this structure was very pleasant to practice, it sometimes made us inefficient as it took a long time to discuss what to do even for relatively simple tasks. 

The entire leadership branch of APO last semester followed Katzenbach and Smith's characteristics of high-quality teams fairly closely. We shaped our goals according to the guidelines the President gave us. The Head Leadership Director translated those guidelines into measurable goals by telling us what events to hold. At 20 people total, with 15 total committee members, 3 directors, our Head Director and our VP, our team was kept at a manageable size. From the VP to the directors, we had clear agreements on our working relationships. Our weaknesses were not having a good mixture of expertise (which is hard to come by in an environment of college students) and not having a way to hold each other accountable. However, each member of the team was responsible and ready to work with others, so we managed to power through those weaknesses as a team. Everyone wanted to contribute, so there was little need for a formal system of accountability.

At the individual level, I suppose that being a good member of the leadership branch of APO means being willing to work with others, communicating well, and holding yourself accountable (especially since there is little "official" way to hold each other accountable.) For committee members, you also have to be flexible on what you do, due to the dynamic, self-directed nature of committee member duties. These qualities help the team by helping information to flow more freely and team efforts to take place with little conflict. Everyone on the team last semester had these qualities, and if there were any major conflicts, I did not know about them. I suppose our good teamwork was encouraged by the fact that there was a lot of fellowship and camaraderie among APO members, and many of us knew each other outside of meetings. These relationships encouraged information to flow more freely and compromises to be reached more quickly and smoothly. While we were not a perfect team, as, for example, we had a clear divide between directors and the VP and the decision-making process within my committee was democratic but inefficient, by and large we managed to work well together as a team in spite of our issues. On my committee specifically, I believe the morale boost and resulting increase in productivity we gained by working in a flexible, open environment with similarly-interested people made up for the loss in efficiency from the all-channel network structure.

Blog Post 3: Opportunistic Behavior

Ho Chi Minh City, Vietnam was known throughout Southeast Asia for its nightlife, but I was in no such mood. I was starting my trip to Vietnam jetlagged and sleepy -- all I wanted was a good night's rest. As the airport shuttle pulled up to the hotel, I tipped the driver and handed the concierge my luggage. It wasn't until five minutes later when I got to my room that I realized I had forgotten my backpack in the shuttle. My backpack contained the wad of Vietnamese Dong which was meant to get me through the first week of the trip. That wad was in my backpack's front, most easily accessible pocket. I could already feel the cold sweat on my face when there was a knock at my door -- the shuttle driver stood there smiling, holding my backpack. After grabbing my backpack, thanking, and tipping him, I shut my door and checked my backpack. To my relief, my money was still there, untouched.

            The driver could have behaved opportunistically by keeping my backpack and the valuables within. It would have been difficult to trace the theft to the driver, as my backpack could have also been taken by the navigator in the van or any of the multiple other guests, or even one of the concierges that handled the luggage. While the driver could have taken advantage of the situation by taking my backpack with quite possibly little chance of getting caught, maybe by telling his coworkers he would take my backpack to my room but instead sneaking away with it, he chose not to. The reasons for this lack of opportunistic behavior could range from a desire to be a "good citizen" and concerns over personal ethics to a preference for the possible risk-free rewards for trustworthy behavior.

            Personal preference for ethical behavior and good citizenship likely played at least some role in the driver's decision. Taking value and utility from another person (in this case, the material goods of my backpack and the money) for personal gain directly contradicts most ethical philosophies. The driver was likely raised with exposure to the ethical belief that material gain should be obtained ethically and without stealing it from anyone else. He would then have internalized those ethical values to be acted upon throughout his life. The driver may have also realized that, if everyone always acted on such opportunities, trust between members of society would degrade and economies and nations would slowly crumble. Therefore, it would have been good citizenship to return my backpack, as he would be contributing to the basic trust and decency that keeps a society running. The driver likely valued good citizenship and adherence to his ethical beliefs, so therefore returning my backpack was in line with his own internal and personal values.

            Another factor in the driver's decision was likely the material gains that could result from behaving ethically. After all, I tipped him when he brought back my backpack, which is what many other guests would have done in that situation. The tips would come with no risk of any loss, unlike the gains from the most opportunistic decision (since no matter what, there is at least some chance of being caught stealing the backpack and experiencing the appropriate consequences.) Repeated returning of items left behind over time would likely result in a sizeable amount of money in aggregated tips. Also, becoming known to guests as a trustworthy person would likely result in guests becoming friendlier with him and giving him greater tips for services throughout their stay than if lost items simply disappeared. Becoming known as a trustworthy employee to the hotel's management may also bring a greater chance of promotions and pay raises in the future. All of these opportunities afforded by non-opportunistic behavior could add up to an amount greater than the value of lost items and their contents. Eschewing greater short-term gains through non-opportunistic behavior can result in even greater long-term gains at lower risk. In addition to wanting to follow his personal values, the shuttle driver also likely wanted to take advantage of these future material gains, because as the saying goes, "good things come to those who wait."

            In my view, the benefits of not taking advantage of the opportunity to steal my backpack can be placed in one of two categories: personal and material. Both types of benefits result from the same action, but can be considered separately. Following his personal values would not have given the driver any hope of future material gain if other people did not value that behavior. The material gain from the driver's ethical behavior would not have suited the driver's personal values if the driver had not internalized ethical values. Interestingly, benefits to personal values from non-opportunistic behavior depend on one's own values while material gains from non-opportunistic behavior depend on others' values and whether they value that behavior. The two types of benefits of avoiding the most opportunistic course of action are what drive ethical and trustworthy people. 

Blog Post 2: My Experiences with Organizations

I have had experience with a variety of organizations, each in a different stage of the organizational lifecycle. The first organization is the service fraternity of which I am currently a member, Alpha Phi Omega, or APO. During my time as an APO brother, the organization has been in a phase of strong growth that has been reflected in the changes I have experienced in the organization. The second organization, the American Red Cross Club, was in a more stable, mature phase, while the third organization, Boat People, SOS, was in the later phases of decline. Each organization was uniquely characterized by the growth stage in which I encountered it, and with each experience I gained a more complete view of organizational economics.

            Alpha Phi Omega's rapid growth is fueled by the influx of new members that increases with each semester. Growth begets growth as new members tell their friends of the benefits of joining APO, who will in turn join and tell their friends. The structure of the organization is similar to many other fraternities of similar size -- it is headed by a President with a board of Vice Presidents. The Vice Presidents each preside over a different division of the organization, such as the division in charge of social events or the one in charge of leadership-building events. The divisions are run by committee members, chairs, and directors. Many decisions on what events to be held were made at the "edge" by the lower-ranked leadership, as that was believed to be the most efficient mode of decision making. Many officer positions are highly competitive to get, as APO's growth keeps members enthusiastic and engaged. The changes I have seen in APO are largely reactions to the organization's growth, such as the creation of new positions to handle the increased programming needed. There are also concerns of handling APO's growth more efficiently, resulting in the merging of several similar positions where having separate officers that worked as a team was believed to cause inefficiency and underperformance due to the transaction costs involved with working with another person.

            The American Red Cross Club's membership had largely stabilized, and growth was neither sought nor avoided. The leadership structure was headed by a President with several chairs working under them, such as the Education Chair or the Philanthropy Chair. Decisions seemed to be made more at the "center" by the upper leadership, likely owing at least in part to the fact that the ARCC's small size meant that it was feasible for a few people to be in charge of most decisions. The leadership structure had not changed in five years at the time when I joined, and did not change during my time there. The organization's stable membership numbers resulted in no new programming needed, so there was no need for new officer positions. Also, because the ARCC had not experienced any significant changes in a long time, this likely gave the organization the opportunity to find the most efficient way of organizing its leadership in a way that allowed sufficient programming and kept transaction costs to a minimum.

            Boat People, SOS is a not-for-profit organization dedicated to helping underprivileged Vietnamese-Americans. At the time when I was there, the organization's staffing and beneficiary numbers were both in decline due to decreasing funding which was driven by dwindling need for the organization's work, as Vietnamese-Americans have been fairly socioeconomically well off in recent years. The organization's leadership consisted of a President, his assistant, several heads of various departments such as Human Resources, Fund Development, and Education, and the secretaries and interns working under them. Several departments such as Human Resources consisted of only the department head and no one else. During my time at the organization, dwindling workloads caused several staff members to be laid off without any replacement for better efficiency. The President, recognizing the opportunity cost of allowing multiple unused offices to remain unused, began renting out portions of the organization's office suite. The company's Board put forth several suggestions to foster the company's growth, such as expanding their mission to include members of other minority communities, but nothing came of them, as the organization's decisions were made from the "center" and the President did not want to change the organization's mission due to his personal beliefs.. Boat People, SOS's changes in leadership were essentially the opposite of APO's -- while in both cases the organizations wanted to be more efficient, they reached their goals by changing their number of leadership positions in opposite directions.

            All organizations want to operate efficiently, and the organization's growth situation often determines what the most effective path to that efficiency is. Finding the most efficient leadership structure takes time. These case studies of organizations I have been a part of have reminded me of the organizational economics of growth and decline and their effect on an organization's leadership positions. They have also given me hands-on exposure to the concepts of center vs. edge decision making and transaction costs and I hope to study all of these topics more in the future. 

Biographical Sketch of John Hicks

http://www.nobelprize.org/nobel_prizes/economic-sciences/laureates/1972/hicks.jpg

I was assigned the economist John Hicks. John Hicks was born in Warwick, England on April 8th, 1904. He attended Balliol College, Oxford from 1922 to 1926 on a mathematics scholarship. While he studied mathematics at first, over his time at the College his interests shifted to philosophy, politics, and economics, and he shifted his course of study to focus on those subjects in 1923. He graduated from Balliol College in 1926 with second class honors. Throughout his career, Hicks taught at a number of British colleges, including the London School of Economics, Cambridge, and the University of Manchester. He became a Fellow of the British Academy in 1942, a member of the Royal Swedish Academy in 1958, and won the Nobel Prize in Economics in 1972 for his work in equilibrium theory and welfare theory.

John Hicks's illustrious research career is know for four major contributions. The first is the introduction of the concept of elasticity of substitution, which shows that labor-saving technological progress does not necessarily decrease labor's share of national income. His second contribution is the IS-LM model, which showed that an economy can remain in equilibrium even with a significant amount of unemployment. The third contribution is his book Value and Capital, which showed that the workings of the economics of value theory can be derived without assuming that utility is quantifiable. The fourth main contribution is the Hicks Compensation Test, which holds that if the value gained by those helped by a particular economic outcome outweighed the value lost by those hurt by the economic outcome and therefore could, in theory, be used to compensate those hurt by the economic outcome, the economic outcome in question is favorable. Hicks's work resulted in a more thorough understanding of economic fields such as labor, welfare, and general equilibrium economics. His work also advanced the theories of other economists such as John Maynard Keynes, whose argument on general equilibrium economics was shown graphically by Hicks in his IS-LM model. 

I did not know about John Hicks before this class. Now that I know about him, I realize his work is important to our organization economics class. His work in general equilibrium theory is relevant to virtually all fields of economics. His work in welfare economics, especially the Hicks Compensation Test, is especially relevant to our class because some people within an organization will benefit from an economic outcome while others will lose something because of the same outcome, and his compensation test shows that economic outcomes can still be considered positive overall if the benefits outweigh the costs. Hicks's work with the elasticity of substitution is relevant to our class because it shows that the laborers within an organization may not necessarily be harmed by labor-saving technological progress.

References

http://www.thefamouspeople.com/profiles/john-r-hicks-285.php

http://www.econlib.org/library/Enc/bios/Hicks.html

http://www.nobelprize.org/nobel_prizes/economic-sciences/laureates/1972/hicks-bio.html

http://www1.osu.cz/studium/nsu/john%20hicks.htm

http://prizeineconomics.blogspot.com/2008/03/john-hicks.html