The U.S. has never been satisfied with one corporate body type. It has continuously created new ones, and has never been able to commit itself to one it likes best. Publicists and intellectuals name a favorite body type from time to time, but this never lasts. Their taste for bodies are as unmonogamous as any Casanova's. Of course the corporation blames external changes in "the economy" for the instability of its desires, but an equally important source is the corporation's own ambivalence, its conflicted wishes for affluence and control, human fulfillment and scientific management, endlessly increasing satisfactions and stratifying measurements of everything.
Corporate body types are inclined to multiply. Though each actual corporation is a mixture, body types can be sorted and arranged.
GENUS X: THE SCIENTIFIC CORPORATION. TYPES UHF
U is for unified. This corporate body is run by the head. All instructions issue from above. No hand washes the other unless the head requests it and watches. William G. Ouchi writes that in this body "no subportion of the organization can exist on its own." Execution depends on thought, and thought is the province of the boardroom. Execution is directed by consciousness that exists up above. The chief executive officer holds the prerogatives of the monarch in a centralized version of medieval society. His or her distinct realms -- marketing and sales, research and development, accounting -- are run by princes who owe royal fealty.
The modern corporation resurrected the form of the medieval state through the huge railroad companies that began to absorb loose parts and independent pieces of companies after the Civil War. The war that purged slavery from U.S. democracy also established despotic authority at the heart of its economy. Bureaucratic administration arose on the royal model. Administration thus dodged the menace of self-management, the autocoordination of cooperative units existing on equal footing, even though this might have been expected of a democratic culture. Administration became identical with top-down command running through the cadres placed in rank order and newly wired for control.
Around 1900, Corporation U's top-down coordination was streamlined by scientific management. Its father was Frederick W. Taylor, who conducted elaborate time-and-motion studies of a worker's most minute movements during the production process. These movements could then be scientifically choreographed more precisely than any Ballanchine ballet. The cast of thousands absorbed, in Mauro F. GuillÚn's phrase, "the cheapest adequate worker to perform each of the divided tasks," to which he was married by the science of functional foremanship. The process was planned by management and applied to labor: head had no relation to hands other than dictating their routine.
The circulation of instructions through the body met friction and resistance. At times the hands openly rebelled. When they did, they used Marxist criticisms of capitalism and other trade union criticisms of management. But they also drew on a revolution in management theory sometimes called the "human relations" approach, which by the 1920s had come to wage guerrilla war on Taylorist regulation.
Early human relations writers included Mary Parker Follett and Elton Mayo, and they rejected scientific management's model of efficiency. Their notion of human relations held a few truths to be self-evident: "workers are not only motivated by economic incentives. Workers are not interchangeable or disposable productive elements but part of the community of the firm. There is a need to integrate them fully, to harmonize interests and behavior, to develop a sense of belonging" (GuillÚn). "On-the-job decisions [are] made faster and better when the employees directly involved are making them. People who have a say in their company's affairs will be happier and more productive than people who are always carrying out somebody else's orders" (John Case). Human relations writers continue to believe that financial performance hinges on the very complicated, delicate, powerful human factor -- that economics is as much determined by culture as by money and monarchs. Good management should suppress the monarchical and elevate the democratic.
The rule of the U was wracked with division even as it conquered the economy. It successfully equated its form of royalist enlightenment with progress and efficiency. But it made enemies of most of the millions whose own designs and dreams were absorbed into its own.
CORPORATION H (VERSION 1.0)
H is for holding company. The corporate body is not unified and not all the parts are attached. Some parts are loose enough to be held. The big hand grows fingers and the feet grow toes. The parts can still be surveyed and supervised, but they can also have operational freedom. The parts can even be separate bodies in themselves: NBC is a wholly functional unit held by the larger corpus known as General Electric. Each unit acts partially on its own. With the H-form, the monolithic U evolves into a conglomerate. It takes on the structure of a network, differentiates functions, develops parallel processing, and grows the separate nervous systems and independent extremities that make Corporation H a far better simulacrum of the body of society.
H is also for headquarters, the multiplication of centers of decision, U-form city-states gathered together into a federation. H is the subtilization of the authority of the U into more roundabout modes. In the U, the foreman, the head of sales, or anyone else was monitored by the continuous presence of the executive's agents. Body parts were regulated by the metabolic rules of production. In the H, the executive rules through cost calculations and financial demands. Power covers a greater distance, and becomes codependent with complex information. Power works through computation. Corporation H keeps the parts under the executive eye. And yet it starts a quiet revolution against the monolithical U. H is for also for hiding, for the places where heretics and inventors screened their activities in the H's extremes. Products like Apple's Macintosh emerged from the back offices of company pirates, who supported their unauthorized research with funds bootlegged or confiscated from the boardroom's moneymen.
F is for finance. Finance translates a company's array of products and relationships into numbers. Divisions are labelled by numerical measures of profit and loss. After World War II, but especially after 1980, financial accounting managed to make numerical information into the dominant force behind corporate governance. As sociologist Neil Fligstein shows, the corporation increasingly viewed itself "as collections of assets earning differing rates of return, not as producers of given goods." Corporations had initially been organizations devoted to the profitable production of commodities. Corporation F is itself a commodity, selling its parts if the money is right, buying up pieces of others, trading in organs.
In the F-form, finance becomes an anatomical principle. Corporate parts had always been bound together by financial issues of course, but also by tradition, legal agreements, production processes, marketing benefits and personal relationships. U.S. Steel had long manufactured different products with different corporate units which had nonetheless been linked by common raw materials, machinery, manufacturing techniques, and the CEO's will to power. But these relationships were trumped by financial calculations when, in the late 1970s, upper management at US Steel decided it could make more money outside of steel than in. It closed fourteen steel plants, picked up an $850 million tax write-off, and spent $6 billion buying Marathon Oil. This was not "the global economy," this was autoamputation and reconstructive surgery for calculated gain. U.S. Steel bought chemical companies and shopping malls and in general directed half its revenues into non-steel activities. The company renamed itself USX, the rump of U.S. Steel multiplied by anything, attaching itself to whatever the numbers suggested.
Corporation F still has equipment and employees, but its structure is a language, the language of accounting, as interpreted by the fiscal desires of the board. Financial people are Corporation F's superior race. They dream in numbers. Steve Wynn, who owned the Golden Nugget casino in Las Vegas, raised money through Michael Milken in the late 1970s to build an Atlantic City casino that swelled Wynn's initial $2 million into $75 million in a couple of years. In dreams numbers tell their own stories. The stories are of the infinite accumulation of value, of the financial edifice that you will build with huge borrowings of money that dams up a trickle of capital until it becomes your personal Lake Mead. The accumulation looks magical, like the exponentially multiplied energy released by nuclear fission. But its logic is entirely legible in the language of finance.
Finance is the Latin of the boardroom, unspeakable to the masses who spellcheck and download. Finance claims the power of prophecy, deciding what can be built and what cannot, who will and will not be served and with what, what in the future we may and may not afford. Like all forms of prophecy, the financial kind expresses the relationships that ground its existence. For finance these relationships are not of production or personnel, but of assets whose buying or selling will render production and personnel unnecessary. Time Warner CEO Gerald Levin says, "'I had thought for a long time that [Time] needed what I always referred to as a 'transforming transaction,' because I didn't think we could build ourselves into this new world." Great finance transcends labor and production. When it spends a few weeks to devise conglomerates worth more than were the targeted companies after decades of building, finance conjures value and rules time.
Corporation F suspends the Euclidean laws of labor only for the players in the financial transaction. For everyone else the law still dictates the selling of labor-power for a wage, one that is increasingly squeezed for the greater glory of natural capital growth. The F-form perfects the power of the board by associating it with mathematical laws. Rather than overcoming the relations of production that scientific management sought to control, finance extends scientific management from the governance of production to the constitution of the body itself.
GENUS Y: THE SOCIAL CORPORATION. TYPES VHB
The standard body types have their alter egos, and these have shadowed the UHF forms from the start. The alter egos counter science with society and confront the alleged laws of movement, manufacture, and finance with their social foundations. The standard bodies believe that "clear purposes and objectives for organizations exist" that can be determined through financial objectives, and that firms are "closed systems" in which little outside the organization need be considered. The alter egos assume open systems and social actors. As Tom Peters and Robert Waterman write, "The social view supposes that decisions about objectives are value choices, not mechanical ones. Such choices are made not so much by clear-headed thinking as by social coalition, past habit patterns, and other dynamics that affect people working in groups."
The standard bodies revolve around what Douglas McGregor in 1960 called Theory X. The alter egos like Theory Y. McGregor called Theory X "the assumption of the mediocrity of the masses." The masses "need to be coerced, controlled, directed, and threatened with punishment to get them to put forward adequate effort," he said. Theory Y, by contrast, assumes that "the capacity to exercise a relatively high degree of imagination, ingenuity, and creativity in the solution of organizational problems is widely, not narrowly, distributed in the population."
The VHB forms exist in part as a response to much-discussed changes in the "global economy." But they also exist for a more important reason -- to serve as organizations that reject the tradition of thousands of years of recorded history by putting creativity and freedom in reach of everyone. What if invention came routinely not from a corporation's top one percent but from its top five or fifty or top one hundred percent? This would be like nuclear fission again, multiplying change by many factors of ten. There would be a revolution in human conditions.
V is for Virtual. The virtual corporation holds itself together by information processing. Its relations reside in the ties between the people that process information. It exists to produce a "virtual product" whose concept, design, and manufacture, write William H. Davidow and Michael S. Malone, "are stored in the minds of cooperating teams." Ideally, the V-form has no set form, no formulaic lines of command, no fixed authority. Virtuality reflects "what is going on around us today -- formerly well-defined structures beginning to lose their edges, seemingly permanent things starting to continuously change, and products and services adapting to match our desires." The virtual corporation "will appear less a discrete enterprise and more an ever-varying cluster of common activities in the midst of a vast fabric of relationships." Corporation F subordinated social relations to maximum returns. Corporation V takes direction from social relations. The F-form traced genesis to financial transactions. The V-form traces it to the collaborative pursuit of social desire.
CORPORATION H (VERSION 2.0)
H is for horizontal. Traditional managerial hierarchy withers the virtual corporation. Davidow and Malone write that "The system of the past, which was so effective for a static environment of mass production, will be a disaster" in the sped-up contemporary market-place. Fast responses must be creative, and can't wait for top-down direction and mid-level approval. Employees shouldn't do what they're told. They should do, in Dick Cornuelle's phrase, "what they are not told, or even what they can't be told." Thus Corporation H (Version 2.0) seeks horizontal networks rather than vertical authority. It aspires to its own "demanaging."
In 1970, an obscure journalist named Alvin Toffler was already articulating most of what has seemed stunningly new about the 1990s. One of his claims was that hierarchical bureaucracies were gradually being extinguished less by left-wing social movements than by internal changes in modern economies. Technology in general and information technology in particular were revolutionizing social systems and individual lives; the result was not only revolutionary change, but the revolutionizing of the pace of change beyond anything in previous human experience.
As machines take over routine tasks and the accelerative thrust increases the amount of novelty in the environment, more and more of the energy of society (and its organizations) must turn toward the solution of non-routine problems. This requires a degree of imagination and creativity that bureaucracy, with its man-in-a-slot organization, its permanent structures, and its hierarchies, is not well equipped to provide. Thus it is not surprising to find that wherever organizations today are caught up in the stream of technological or social change, wherever research and development is important, wherever men must cope with first-time problems, the decline of bureaucratic forms is most pronounced. In these frontier organizations a new system of human relations is springing up. In Corporation H version 2, the slot-filler molts into creative maturity, "assumes decision-making responsibility," becomes "empowered" to create.
B is for Bodies© INCorporated. B is a lab for testing the desires that lie within Y body types. The desire for freedom, the desire for equality, the desire for expression, the desire for creativity, the desire to overcome boundaries -- these are not obviously compatible with the actual history of corporations. How do we replace the standard with its double?
Corporation B plays out some Y-theory contradictions. One the one hand, it establishes a virtual corporation as an "active community" of participants who chose their own bodily form. The primary activity is the creation of a body in exchange for which the creator is given a share of stock. Corporation B thus exists to express each members' desire about his or her physical shape. Production serves self-creation. Firm membership formally ratifies expression. These expressions have none of the usual limits: men become women; black becomes white and white becomes brown; flesh turns to clay, plastic, air; clay, plastic, air are attached on one body. Bodies need be neither whole nor have parts that fit.
The value of the corporation consists of the virtual artistic results of this self-expression. Labor is self-directed. Labor in fact, almost entirely disappears. The corporation has no employees. Labor cannot be distinguished from artistic management. Management has metamorphosed as well. Managerial layers of control do not exist. The boundaries of the corporation are virtual and permeable. Anyone who wants to become a member can do so. The consumers of the product are also its producers. Shareholders are all consumers, and all consumers have shares. All this makes Corporation B open to the surrounding society. As an instrument of production, it is subject to its members' non-financial desires.
At the same time, B acknowledges that open design easily coexists with boardroom supervision. Bodies© INCorporated has a governing board that dictates a uniform aesthetic. Its members set policy by consulting each other. Domains and practices are dictated from above. Its rules aspire to "tight control." The shareholders' create bodily representations of themselves that are immediately alienated from them. Self-expression is not self-owned, but becomes the property of the corporation. Corporation B does not ask permission to display a stockholder's body, but merely informs. Consultation is constructed as what it generally is -- read-only memory. Membership does not confer the power to write rules. Agency is terminated with the registration of the bodily product, which confers no managerial rights. The author is not proprietor.
To make matters worse, no labor exists independently of the corporate order. No money changes hands to acknowledge the separation of parties. The open B incorporates society, granting access to virtual spaces in exchange for giving up citizen sovereignty. Representation exists through fantasmatic bodies that can be instantly liquidated by the executive coders. When the B body eliminates the old corporation's structural antagonisms, overcomes labor, and replaces force with preformatted participation, it replicates the psuedoorganic body of fascist society.
Corporation B experiments with the collision between radical democracy and neoauthoritarianism out of which will emerge any genuine Y form that really differs from the old. B knows that the mantras of creativity, flexibility, and local control can as readily serve tyranny as emancipation. Corporation B arises from an art project that rearticulates the business corporation by mimicking it. But it is aware that you cannot mimic the toppling of the pillars without mimicking the pillars themselves. The Virtual and the Horizontal Corporations will mean something only with new human relations accompanied by a new willingness to confront the old command and control. Corporation B experiments with the new but acknowledges the severity of the old.
The body questions persist. What always died when it entered the old corporate body? What in that corporate body could never be born? What will a new body allow to live?
Many were set free by the old corporate body. Millions of others were swallowed by it. They were never able to gain their autonomy in it. You might say they were Borg-ed.
We are born magicians and workers of miracles, artists and makers. The X corporation, like financial capital, was a miracle, a release of colossal energies of creation. And its tyrannical government and human engineering and exploitation of labor banished the spirit that created it. What kind of new body could avoid this expulsion? Which would mean freedom for all of its members? What are we doing to create it? The millions who went missing are asking us.
There's no more important change right now than culture recapturing technology -- recapturing technology not to reject it but to make culture its partner again as we invent our future, our society, our redemptions. An excellent place to begin is the B-form's recolonization of business power for the artist's mode of continuous invention business now says it seeks. You will know the recolonization is working when you say, paraphrasing Louis Massiah, "it makes revolution irresistible."
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