Ling was talking specifically about his problems as an equity venturer studying organizations from the outside, but his words apply cogently to any man or woman trying to deal with an organization from the inside. You are in this organization for better or worse. Your aim is to make your place in it more secure. Your future depends on thoughts and actions that take place in the hierarchies around and above you--including some thoughts and actions of people you will never meet. To achieve security you must clearly understand how this organization works and how its machinery impinges on you.
The Seat of Power
Nearly every business organization--including those that claim to operate by means of "team management"--has one man or woman at the apex of its power structure. This one person makes the final decisions on virtually all of the organization's large questions. I call this person the seat of power. All authority flows downward from this seat.
The seat of power is not necessarily the person with the grandest-sounding title. In some companies the most powerful person is the chairman of the board. In others, though the chairman may be named first in the annual report and may be portrayed with the biggest picture, the seat of power may be the president. This was the case for many years at NBC, for instance.
In still other companies, though more rarely, the seat of power may be the executive vice-president or somebody with another title. This happens most often in closely held or family-owned companies. The board chairman and president may both be major stockholders or family members who play only a distant role in the company's daily operations. The day-to-day operating decisions are made by a person who appears to rank third in terms of title but actually ranks first in terms of power.
In your attempt to understand the organization in which you work, your first step should be to locate the seat of power. Start by studying the latest annual report, if one is published. (It's surprising to me that many employees have never read their own companies' annual reports. Some reports are more informative than others, but you can usually find a lot of valuable clues to top management thinking among those glossy pages.) Read the report to see who designated "chief executive officer." You can usually (but not always) assume that that person is the seat of power. Comb the report further to see who is mentioned most often as having decided this and decreed that. Meanwhile, listen to what is said around the company about the top management group. Who is talked about most often and with the greatest awe and respect?
Power Brokering
Having located the seat of power, your next task is to map the lines of power as they reach down to your level. Between you and the top may be several levels of rank. Your boss reports, perhaps, to the controller, who reports to the vice-president in charge of finance, who reports to the president. The question you must ask yourself is: am I plugged in to a real hierarchy of power, or is it only a hierarchy of responsibility?
Every function in an organization carries responsibility, but not every function carries power.
There are people who talk with the seat of power and have influence there. There are others, of ostensibly equal rank, who do not. The people who have direct, influential contact with the seat of power, and the chains of people below who have influence on them, I call the power brokers.
To illustrate, let's suppose that in your company the seat of power is the president. The president is a man who holds an accounting degree, made his way up through the money-manipulating functions of management, and believes the way to keep the company afloat in today's stormy economic seas is sound finance. He listens closely to the advice of the financial vice-president, a woman of similar background and beliefs. She, therefore, is a power broker. To a lesser degree, so is the controller, who reports to and often confers closely with her; and to a still lesser degree, so is your boss, who has the ear and respect of the controller.
If this is your situation, you are in a basically promising job environment. You are directly plugged in to a line of power. But let's suppose the situation is different. Let's say the president, the seat of power, is a marketing genius. Marketing has been his game throughout his career; it is the field in which he has made his name, and it is the reason why he has been installed as president. The directors pin their hopes on clever marketing strategy to pull the company through its difficulties, and he, of course, wholeheartedly shares that philosophy. Hence, he has lunch and plays golf often with the vice-president of marketing and the advertising director. They are the power brokers. The vice-president of finance, the controller, and your boss are not.
In this case you are in a vulnerable position. Your job is not as secure as you could wish. You are not in a department from which people are likely to be plucked for meaningful promotions. Thus, your indicated strategy would be either to seek ways of making your department more powerful or to get yourself transferred closer to the power brokers.
Neither of these two courses is exceptionally difficult. One man whose high climb I've studied started his career in an unpromising area: the personnel department of a large manufacturing company. Many companies respect and nurture their personnel departments, but in this particular company the president considered personnel an unimportant and even frivolous function. Indeed, it would not be an exaggeration to say he held it in contempt.
The man I'm talking about--call him Ed--observed this distressing fact soon after being hired into the personnel department. Carefully examining the company's power structure in the ways I've indicated, he saw that the main power brokers were the finance and engineering people. They had the president's ear. Their departments were lavishly rewarded with money; their people were secure in their jobs and were routinely promoted up the ladder. The personnel department, by contrast, was a Siberia. People froze there. The personnel director was rarely invited to the really important deliberations in the upper executive offices. He was not in any sense a power broker; nor was Ed's immediate superior, the supervisor of benefit programs, who reported to the personnel director.
Ed concluded that his only feasible route to security and promotions was to get into either the finance or the engineering operations of the company. He knew virtually nothing of engineering but had had considerable financial schooling and felt capable of learning more on the subject quickly. He prescribed a course of study for himself, bided his time, and kept his eyes and ears open.
His chance soon came. His group was given the task of stream lining the company's poorly organized benefits program. He volunteered to make an analysis of costs. When he was satisfied that the analysis was the best piece of work he could do, he showed it to the controller, who had asked to be consulted about it. The controller was impressed with Ed's clear, concise presentation. The chemistry between the two men was good. Without saying anything unkind about the personnel department, Ed managed to make known his desire to get into financial-analysis work. In time, the controller had him transferred.
Ed today is a member of that company's top management team. He himself is one of the power brokers. He has tried to do things for the friends he left behind in the personnel department, but the company president's feelings about it have not changed. Most of those working in that department still have dim future, at best. It is sad that perfectly good people so often languish in inactive departments with poor leadership. I've watched them: impressively bright people, some of them, doomed to spend years of their lives turning out reams of reports that nobody will ever read. In good times they may get token raises because the corporation feels charitable. In less than good times their salaries are the first to be frozen, and they are first on the list of expendable employees who can be dumped if necessary. That is a fate to be avoided.
Identifying the Power Brokers
In some companies it is fairly easy to identify the power brokers, in others not so easy. Here are the main clues to look for:
Power brokers are talked about. Listen to what is said not only by people at your own level of rank, but also by those above you. Listen to what your boss says on the phone. Listen in elevators, at meetings. The names of power brokers tend to come up often, and there will frequently be a tone of awe or anxiety in the speaker's voice: "I don't know what Mr. Walters is going to say when he hears about this..."
Access to these powerful people is seldom easy. There may be a lot of pious talk around the company about easy access. "My door is always open to anybody with a problem," the president will say in his best avuncular voice, and other executives will parrot the statement. In practice, however, it is usually a sham. Access to the least powerful may be easy enough. But if you have a problem that needs the attention of a power broker, first you talk to his secretary, and if you are lucky she will then pass you through to his assistant.
As a general rule, you can guess who at least some of the power brokers are by reading up on the background of the top person, the seat of power. This background may be alluded to in an annual report or may be sketched in a magazine article--or may simply be common knowledge throughout the company. The top person will usually lean toward those of similar background; they will be the power brokers.
At Polaroid Corp., for instance, the seat of power for years was the founder and president, Edwin Land. A scientist, Land naturally elevated research-oriented people to high positions in his stunningly successful company. Research and engineering groups were good places to be.
However, don't make the mistake of supposing these people sharing the top person's background are the only power brokers. Edwin Land always had enormous respect for the marketing function, though he admitted it was not his own area of expertise. Hence, marketing people at Polaroid were also well plugged in to lines of power.
Conversely, marketing has almost always been the main interest of the seat of power at Procter & Gamble. The company's last three chairmen--John Hanley, Howard Morgens, and Edward Harness--all came up through fields such as marketing, advertising, and promotion, and naturally the strongest lines of power in that company have been the lines that went through those departments. But Harness, for one, has put heavy emphasis on research and testing--particularly since the company's Rely-brand tampons got involved in a staggeringly expensive medical scare in 1980. Thus, if you work in or around a lab at P&G, the chances are you are plugged in to power.
Power brokers have perks, often highly visible. Look for the men and women with big offices, the ones who are privileged to ride in the company plane. "At our company," says a woman who works for a Connecticut-based insurance company, "we can tell who has the power partly by looking at the reserved spaces in the parking lot. The president and chairman get to park closest to the building. Then come others in descending order of power, more or less. But you have to read it carefully. There's at least one man who is near retirement and has hardly any power or even any function anymore, but he has a close-in parking space because he's been around longer than anybody else."
All clues about power brokers must be read with care, in fact. Don't depend on only one clue or two. Investigate thoroughly in all the ways I've outlined, and don't stop investigating until you have a solid package of clues that all seem to agree. When you have all those clues assembled, you will know whether you are close enough to the power.
