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The Times They Are A-Chainin’:Comparing Independents and Multinational

Chains

By Zach Hayworth, Laura Logozzo, and Chrisinda Lynch

Seminar 4 PresentationsMay 12th, 2013

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Research Topic on New York Organizations

How are New York-based independently-owned and multinational chain retail organizations different and similar in their uses of control over employees?

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Thesis

Both New York-based independently-owned and multinational retail organizations use bureaucratic and cooperative system as forms of control over employees. Independents favor cooperative communication, common purpose and incentives, while multinationals favor bureaucratic regulation, division of labor, and hierarchy. Some independents strategically incorporate aspects of both control systems due to increased competition in the marketplace.

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Why is this research topic important?

• To survive when faced with direct competition from multinational chains, independents may be forced to shift natural methods of control to the rational methods more characteristic of their corporate competitors.

• Some of New York’s independents may start to look more like multinational chains

• Lack of diverse options for customers and employees

• Potential loss of organizations that are essential to New York’s identity

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Research Sites: Independent and Multinational Retail Organizations

Organization Type Description Location

Thrifting Factory Independent Thrift store run by local charity

Soho

Fishnets Independent Small activist bookstore

Lower East Side

American Clothing

Multinational Midrange clothing store, American-run

Lower East Side

Unique Clothing Multinational Inexpensive clothing store, Japanese-run

Herald Square

Miles of Books Independent Used and specialty bookstore

Union Square

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Organizational Output (x) and Mission (y)

Thrifting Factory

Fishnets

Unique ClothingAmerican Clothing

Miles of Books

For-profit mission

Non-profit mission

Specialized goods/services

Mass produced goods/ser

vices

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Methods: ObservationsOrganization Type of

ObservationTime Period/Duration Participant?

Thrifting Factory

Covert Saturday, March 9th, 201312:30-2:00 PM (1.5 hr.)

Friday, April 6th, 20135:00-6:15 PM(1 hr., 15 min.)

No

Fishnets Covert Saturday, Feb. 16th, 201311:50-1:20 PM (1.5 hr.)

Friday, April 6th, 20132:30-3:40 PM(1 hr, 10 min.)

No

American Clothing

Overt Friday, Feb. 22nd, 20133:30-5:30 PM(2 hr.)

Friday, March 1st, 20133:30-5:30 PM(2 hr.)

No

Unique Clothing

Covert Wednesday, April 10th, 20135 – 7 PM(2 hr.)

Monday, April 22nd, 2013 4:15-6:15 PM(2 hr.)

No

Miles of Books

Covert Wednesday, Feb. 20th, 2013 10 AM – 12 PM(2 hr.)

Wednesday, March 6th, 20133 PM – 5 PM(2 hr.)

No

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Benefits and Limitations of Methods

• Small number of observations• Short periods of time• Covert observations are more candid• Overt observations give more insider

information• Field note accuracy

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Two Research Theories That Emphasize Top-Down Control

Weber’s Bureaucracy Barnard’s Cooperative Systems

• Rational systems perspective

• Fixed division of labor• Hierarchy of offices• Set of general rules• Separation of personal

from official property• Technical-based personnel

selection• Career-oriented

employment.

• Natural systems perspective

• Organizations = cooperative systems

• Three elements of informal organization:

• (1) Willingness of participants - incentives

• (2) Communication• (3) Common Purpose• Leadership establishes

moral code and common purpose

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How do independents use cooperative control?

Barnard’s Cooperative Systems

• Common purpose“Audrey and Hannah [volunteers] began to have a conversation about different political systems…Hannah did most of the talking, as she was explaining her views on anarchism and socialism to Audrey.” (Fishnets, Observation 2)

“It is not a typical nonprofit organization; it is a healing community of people impacted by [a certain disease]…it is one of only a few organizations that make use of direct action as a job requirement.” (Thrifting Factory Duty to Act Policy)

• Communication “After Ross [volunteer] finished dressing the mannequins, he asked Joey [volunteer] if he could “bring the mannequins out.” Joey agreed, and Ross led him to the back so he could look at his work. Joey seemed to approve, and they carried the mannequins out one at a time…” (Thrifting Factory, Observation 2) “After we began browsing the store, Jessa and Hannah [volunteers] resumed a discussion that they had been having before we arrived. First, they discussed odds and ends related to the store.” (Fishnets, Observation 2)

• Incentives “She [Hannah, a volunteer] said to Audrey [volunteer], “Like you, I came for the feminism, but I’m learning about anarchism.”” (Fishnets, Observation 2).

“I guessed that they might be volunteering at the store for a school requirement, or for their college applications, as neither girl seemed to want to be there. Monica [volunteer] complained to Rachel [volunteer] that she wanted to either go on her break or leave.” (Thrifting Factory, Observation 1)

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How do independents use bureaucratic control?

Weber’s Bureaucracy

• Rules and regulations“Phoebe [volunteer] gave her [customer] a clipboard with a donation form and asked her to fill out where she had bought the old bag and how much she’d paid for it.” (Thrifting Factory, Observation 1) “Hannah [volunteer] gave her [customer] a paper application, which potential volunteers must fill out and drop off at the store, and briefly explained the store’s volunteer hours.” (Fishnets, Observation 2)

• Fixed division of labor“Sid [volunteer] was responsible for checking inventory and filling drink orders, while Nancy [volunteer] was working behind the counter on a computer.” (Fishnets, Observation 1)

“Monica and Rachel [volunteers] were at the same station during the entire time I was there, but the other three employees seemed to rotate tasks.” (Thrifting Factory, Observation 1)

• Technical qualifications Fishnets application asks if the applicant has “worked or volunteered in a café or coffee-house” or “worked or volunteered in a bookstore, infoshop or publishing house.”

Thrifting Factory application asks about “special skills.”

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Weber’s Bureaucracy

• Rules and regulations“All of the employees wore all black clothing, with some kind of red and white ‘Unique Clothing’ card hanging from their necks,” (Unique Clothing, Observation Notes 4).

“When I spoke to the assistant manager about employee dress codes, I was told that they must only wear clothing from the store,” (American Clothing, Observation Notes 2).

• Hierarchy of offices“There was one assistant manager of the store, “Michael,” who was in charge of managing on-floor employees as well as inventory coordinators and assistant coordinators,” (American Clothing, Observation Notes 1).

“As I observed the group more, I realized that they seemed to be trying to rearrange the store. The employee who was directing the group, an Asian man in his early 30s, would state his opinion on the movement of a certain article of clothing, and then the three other employees would voice their opinions on the matter,” (Unique Clothing, Observation Notes 4).

• Fixed division of labor“Inventory coordinators and assistant coordinators ensured that all products on the floor each had one of each size…On-floor employees assisted customers with any questions that they had about the clothing, as well as directed customers to certain parts of the store if they were looking for a specific product,” (American Clothing, Observation Notes 1).

Unique Clothing employees are also assigned specific tasks.

How do chains use bureaucratic control?

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Barnard’s Cooperative Systems

• Communication and informal cooperation“The longest line for the cashiers had only four people, though there was very often no line at all. When the line got to four people, another cashier joined the other two who were already at the cash registers. This third addition made the line move much faster,” (Unique Clothing, Observation 2).

“When observing the cashiers, I noticed that they often asked customers if they received any help from the on-floor employees with finding or picking out their items…Those that said yes were asked who assisted them, and many of the customers did not know the name of the person, so they described them instead. The cashier would then recognize the employee they were talking about, and enter their name into the system,” (American Clothing, Observation 1).

“I also noticed that the leading employee acknowledged and even sometimes agreed to use the ideas and opinions of the employees that were part of the group he was leading, even though he was obviously in charge of the layout,” (Unique Clothing, Observation 2).

• Material IncentivesEmployees receive free clothing from the store every month (American Clothing, Assistant Manager).

Unique Clothing employees receive 30% store discount (Company Website).

How do chains use cooperative control?

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How does Miles of Books use cooperative control?

Barnard’s Cooperative Systems

• Willingness of participants/informal relationships“[during my observation I witnessed an informal staff meeting. One of the employees, who seemed to be a manager]… “said concernedly at one point ‘…yeah, so we need to do at least 25 today to make up for yesterday…’ I assumed they were discussing sales goals, perhaps in terms of thousands of dollars… one of the others, a male in his forties or fifties, said “… and if it slows down, Jennifer said she wouldn’t mind going home early…” (Observation 1)

• Non-material incentives – authority, powerHe referred to himself in the first person when making comment regarding whether he could buy my books or not, as if it was literally he who would be handing me cash out of his own pocket… It seems that he felt a sense of ownership and pride regarding his role as book buyer. (Observation 2)

• Common purpose1. “A quirky bastion of the New York intellectual community” 2012 Newspaper Article2. Commitment to Neighborhood involvement- mural painting “Kids Learning Camp” - Anecdote

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How has Miles of Books shifted?

Thrifting Factory

Fishnets

Unique ClothingAmerican Clothing

Miles of Books

For-profit mission

Non-profit mission

Specialized goods/services

Mass produced goods/ser

vices

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How has Miles of Books shifted?

Thrifting Factory

Fishnets

Unique ClothingAmerican Clothing

Miles of Books

For-profit mission

Non-profit mission

Specialized goods/services

Mass produced goods/ser

vices

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How does Miles of Books use bureaucratic control?

Weber’s Bureaucracy

• Fixed division of labor“At one point, the phone rang at the counter, and the girl picked it up on the third ring. Her tone led me to believe it was someone calling from within the store. She said, “…oh, well I’m scheduled in buying for this hour and then I have my break, but maybe Susan can cover?” Then a pause, and then, “ok, well if no one else can, then let me know, and I will run up. It’s dead down here.”” (Observation 1)

• Hierarchy "The third employee – the one who was standing in front of the counter – was a middle-aged man… He told me he would take my bag and unload my books onto the counter… laying the books on the counter and organizing them by paperback and hardcover. He then took the two Loeb books and placed them in a separate stack. The man on the other side of the counter made no comment to me this entire time. (Observation 2)

• Specific goals and set of regulationsThere was one group of three employees chatting behind the book-buying counter when I first entered the store… One of them, female, probably late twenties, was holding a clip-board and said concernedly at one point “…yeah, so we need to do at least 25 today to make up for yesterday…” I assumed they were discussing sales goals, perhaps in terms of thousands of dollars.” (Observation 1)

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The Future of NYC Organizations• Local independents tend to use more natural

systems of controlling employees, whereas multinational chains tend to use more rational systems.

• When faced with direct competition, local independents may shift to more rational methods of control.

• If chains continue to move in to NYC, local independents might lose their identities.