Rather than the top-down hierarchical strategy of directed control, successful companies are developing organizational cultures manifested through smaller networks in which local knowledge matters; they emphasize getting the best out of a team rather than micromanaging and bossing it around. This “localist” trend is beginning to reshape American politics as well. This report was Narrator's contribution to The New Atlantis's "Place and Placelessness in America" symposium.

Until very recently, the centralization of administrative power under expert control — what we might call, for shorthand, rational planning — was considered essential to public policy solutions. In the industrial and post-industrial eras, advances in science and technology seemed to promise a future of unprecedented efficiency. Centralized programs could coordinate masses of people toward desired goals, in areas from government to business to philanthropy to city planning. Modern policy problems were considered to be, fundamentally, systemic issues too complex for local citizens and requiring expert professional attention. Technology and globalization would only increase the value of this approach.

Now, however, trends have begun to shift in a very different direction. Some of the preeminent projects of rational planning are foundering or altogether failing. The entitlement crisis, the housing bubble, and other prominent stories and scandals have made Americans more skeptical of distant experts. Advances in technology and business have created new possibilities for individual and local empowerment. The pressure is on for products, services, and organizational practices that will enable consumers and participants to solve problems themselves.

By contrast, rational planning viewed human beings mainly in the aggregate, essentially as a collection of data points that could be predicted and manipulated based on such categorical differences as race and gender. The messy web of mediating institutions — families, churches, nonprofits — could be sidestepped. Mass programs, which could operate on a scale impossible in the pre-industrial age, would be able to deal directly with the masses, matching problems with solutions and products with demand. Freed from the complex and sometimes onerous network of relationships formerly required for political life, Americans would interact directly with the powerhouses of finance and planning: the government, major corporations, big foundations, and so on.

This model, it was believed, could be applied across the board. Its most obvious value was in the mass production of goods and services. Top-down, command-and-control business models, replicated identically across the world, would bring ruthless efficiency to the private sector. Corporations would get bigger and bigger, driving material prosperity. And these concepts were applied not just to government and commerce but also to aspects of social life, including city design, which became specialized so that people would live in one place, work in another, shop in another, and play in still another (the invention of the suburb took this model to its logical end). Cities and houses, said French architect Le Corbusier, were “machines for living in.”

But while rational planning allowed for success and efficiency on a greater scale than ever before, it also extended failure and inefficiency to the same scale — and nowhere has this been more obvious than in the political and social sphere. The impending fiscal collapse of the major entitlement programs of the twentieth century signals just what an enormous failure rational planning often proved to be. And “big philanthropy” ran into similar problems as “big government.” Large private foundations like those of Rockefeller and Gates dedicated themselves to wiping out social problems with millions of dollars and professional plans. These foundations have pursued technocratic solutions to such problems as school reform and AIDS in Africa — and they are baffled when, as so often happens, their multibillion-dollar efforts fail miserably. What these failures in government and philanthropy have in common is the idea that whole societies are just “machines for living in.” Experts, the rational planners believed, could descend on a big problem, substitute their theoretical (“scientific”) knowledge for the practical knowledge of the locals, and fix it.

Entire generations in the United States have now grown up in the society the rational planners envisioned, complete with established suburbs, schools, big businesses and foundations, and federal entitlement programs. They live in suburban socioeconomic segregation, and rarely participate in local politics (which has largely become professionalized). Some newer cities, like Houston, were designed by their planners around the car and the TV — not the citizen and the self-governing community. A parent today has good reason to take his family to the suburbs for cheaper housing and better schools, a low-income citizen has every incentive to collect a government welfare check, and neither has any clear reason to participate in politics except to lobby the bureaucracy to maintain his status quo. The experts will take care of the rest.

Yet over the course of a century, human experience has not validated the rational planning assumption — and a response is coming, if the rising generation is any indication. The people who grew up under the realized model of the rationally planned society are increasingly inclined to shrug it off. Rational planning seems to have created a demand for precisely the things it required people to give up. People who have grown up this way — particularly young people now in their teens, twenties, and early thirties — feel isolated and long for a sense of place. They want to make a difference, not in mass organizations or abstract causes, but in connections and relationships close to home. Where their parents protested, these young people volunteer. They often find their first taste of community life in college, where they live, work, and play in the same environment, and can participate in the community by choosing from among the hundreds of student groups and activities on offer. A 2010 study at the University of Northern Colorado found that students who were involved in at least one campus organization considered the university to be a community; those who weren’t involved did not. In short, it seems that to feel connected to the big, they need to be active in the small.

Forward-thinking CEOs, looking to hire these young people, are structuring their companies accordingly. The cutting-edge companies of today still use metrics and scientific techniques of the sort that characterized the rational planning era, but they are also seeking to develop a more place-centered, organic approach. The simple reason: command-and-control can solve some problems, but often creates others — chief among them the corporate ignorance fostered by a lack of on-the-ground expertise. The Prelude Corporation, at one time the largest lobster producer in North America, tried rational planning — and discovered (too late to save itself) that lobster fishing relies heavily on local knowledge. GM and Chrysler, bloated beyond the control of their centralized management, needed federal bailouts in 2009.

By contrast, Ford is on the upswing after making aggressive changes to allow its teams the freedom to innovate. In 2008, the management of Starbucks realized it had started to obsess over mass production and growth, and gotten away from what made its company work — small teams dedicated to making good coffee. Rather than the top-down hierarchical strategy of directed control, companies like these are developing organizational cultures manifested through smaller networks in which local knowledge matters; they emphasize getting the best out of a team rather than micromanaging and bossing it around. The organizations that have made these adjustments — or were founded based upon them, such as Apple, Amazon, and Google — are reporting higher job satisfaction, faster innovation, and greater profits than organizations still laboring under the old methods.

Read the full article at The New Atlantis

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