Abstract

"Decentralizing for Democracy in the Postwar Corporation"

Casey Eilbert, Princeton University (ceilber1@jh.edu)

This paper considers how management thinkers and business leaders pursued corporate decentralization and reorganization in effort to become more “democratic” in the decades following World War II. In the Cold War era, with the Soviet Union a looming example of the perils of bureaucracy, Americans came to see large organizations at home – in business, labor, and government – as unfree and democratic. Concerns with “industrial society” – characterized by big, soulless, and impersonal bureaucracies – were widespread, and in the 1950s, diatribes against “the lonely crowd,” “the man in the grey flannel suit,” and “the organization man” abounded. Americans searched for a way to restore individual autonomy and democracy in a society of large organizations. Their pursuit only intensified in the 1960s as calls for “participatory democracy” became a central part of the American political landscape.

Management thinkers and business leaders claimed that they had the solution. Popular management experts, most notably Peter Drucker, argued that ‘decentralization” – which dismantled hierarchies and moved discretion down the corporate ladder – was not only efficient, but also democratic, offering workers more opportunities for participation and “workplace democracy.” Business leaders eagerly adopted this form and the rhetoric of democracy that accompanied it. In doing so, they established business – not labor or government – as the most democratic sphere in the American political economic landscape. Going forward, this claim would prove an effective way to ward of intervention by government and labor – spheres they portrayed as bureaucratic and thus undemocratic. In the coming decades, when many reorganizations done in the name of “worker participation” proved to their detriment, they would be hard to contest.