Critical Theory of Management

This is an old paper of mine, I had written it during my BA thesis in Critical theory of Management. It investigates through the prism of great thinkers like Habermas, Foucault, Marx and Weber the ineffective business actions and procedures in the market of ITES-BPO specifically in Indian calling centres.

ITES-BPO stands for Information Technology Enabled Service — Business Process Outsource, and if this acronyms seem to be complicated flashback to the last time you tried to reach your Internet or telecommunication provider!

I am always happy to share these findings since it have been one of the most influential research I have ever done.

“The less a man knows of the past and the present the more unreliable must his judgment of the future prove” (Freud, 1928:7)[i].

Under its multi-complex and hyper-typological analysis of organizational studies, Critical management theory tries to unmask the “illusions” created by the conflict-oriented and diverse interests of management, organization, society and culture. Rising from the seats of Marxism, based on alienation and exploitation, along with the Freudian exploration of individual’s delusion, it found fertile soil to blossom in Frankfurt school. The bureaucratic systems of the postmodern societies, technocracy, the mass production and consumption of goods along with the stereotyping and symbolising (money) culture created by all sorts of organisation (government, mass media, schools) is what critically is counterattacked by a “linguistic turn” and theories which look for self renaissance through self awareness, self critical thinking and cognitive autonomy. However, according to poststructuralist ideas a truthful communication is seems more like an Utopia under the coercive effects and destructions of subjectivity and power (Foucault, 1988:18)[ii], as well as under the exclusive control of bourgeois’ culture and science as a productive force (Habermas, 1974:281)[iii]. Conversely to other social sciences, CMT does not present management as the talented authority to control and administer its objects, but as mere functionary of contradiction demands and interests under a capitalistic society full of stakeholders. In doing so, critical theory focuses on the social and political aspects of management by dispute its “technical neutrality” (Grey and Mitev, 1995)[iv].

The term “critical theory” coined by Max Horkheimer, emerged in late 1970’s aimed to ”watch” the social world under a different perspective of that of natural world, which would be explored through epistemological questions, in order to result in man’s emancipation from the technocratization of management (Horkheimer, 1976)[v] and its actors which needed urgent critical examination (Horkheimer, 1989)[vi]. During early 1980’s with the introduction of postmodernism, instrumental management with its “prerogatives” of control and its modernist tradition became the centre of attack. Postmodern theorists with their references on the role of mass media and technology, language and reality, functionalism, the implication that organised human activity is either reactive or defensive, power/knowledge relation (influenced by Nietzsche’s theory of perspectivalism and highly expanded from Foucault) and their opposition to the concept of ideology, added multiple issues in the portfolio of critical theory. A great perspective in critical theory has been added through Foucault’s eyes for “the movement of reforming the prisons” and “disciplinary technology” (Foucault 1977b: 234)[vii], which have been highly relevant to the organizational mechanism, functionalism and their “remedial” strategic actions. In general, this co-relation between critical theory and postmodernism mainly circulates around specific developments in Western thinking whereas in organisation study is mostly under the principles of ideology critique and communicative action.

Ideology critique looks deeper in the structure of society’s dominant ideas and especially how these create power, institutional dominance, hegemony and norms. Under ideology critique raises the de-naturalisation, a way of decompose what has been taken for granted due to its nature for example management and hierarchy that “imply” instruction and superiority. Along with this comes the disillusionment of the monocular management theory and practice upon performance and profits which presupposed that any managerial knowledge its valuable only under maximization of output at a given input. This is part of the universalization of managerial interest, which flattens autonomy, creativity and self-satisfaction in the altar of money interest. It could be linked with Marx’s theory of exploitation and materialism as well as Hegel’s discussion of the master-slave relation (Hegel, 1977)[viii]. A reflection of this relation can be easily found in organisations, ITES/BPO are not excluded, through its hierarchy, the concept of hegemony, and the different interest of the dominant groups over dominated ones.

In addition a major subject under the scope of ideology rose firstly through Horkheimer’s publication of Dialectic of Enlightenment, which linked Enlightenment to instrumental rationality and the domination over nature. Enlightenment for Horkheimer (who have been highly influenced by Weber’s theory of rationality) emphasised the practical advantages of subjective reason,which its main concern, is to “instrumentalize the world to the advantage of the subject”[ix].“Instrumental reason has two opposing elements: the abstract ego emptied of all substance… and on the other hand an empty nature… without any other purpose than that of this very domination”.[x] Upon these, Habermas later on in his publication The Theory of Communicative Action, volume 1investigate and distinct technical (strategic & instrumental) and practical reasoning (communicative reason). In accordance to this emerge the second major subject of Critical theory, which is that of communicative action. In the early 1980’s Habermas influenced by Apel’s reformulation of the differentiation between understanding and explanation, gave a sociological concept to Husserl’s “lifeworld” in which he separated it from the system world. The first one is based on an ethical and self-evident communication where the latter contains strategic and scientific context. Critical theory sets a base in these forms of communication and linguistics and examines the forces, which alternate their process.

These sociological theories and their points of attack are not unfamiliar within any sort of organisations. The day-to-day running through strategic and technocratic management has not only become conscious and concede phenomenon but has been baptised as “specialism”, ”professionalism” and numerous other instrumental typologies like total quality management, human relation management and several other legitimize instrumental authorities which “man has…become a kind of prosthetic god” (Freud 1961:92)[xi].

The tremendous development of technology, the expansion of Internet in 1990’s in addition with the wave of global economic recession in the last decade have turned terms like outsourcing, off shoring and transnationalization to sound familiar despite the unknown process which take place in realty. The “strategic necessity” of foreign organizations in IT services created a highly developed industry in countries with low cost proficient labours and high-tech sectors.

According to Nasscom, the Indian IT-BPO industry recorded revenues of $52 billion in FY07–08 and 768000 total employees base involved in BPO export operations for FY2010.

The British colonization left its linguistic stigma behind, which has been turned into comparative advantage for for India, which is currently the leading country of offshore outsourcing. One of these organizations, MNC, will be the examination paradigm for the above theories of CMT and the reflection of key theorist’s thoughts. Pragmatics of communication, systemsworld, exploitation and alienation, surveillance, techno-bureaucracy, instrumental discipline are just few of the several forms of the depersonalized bullying experienced and instrumental management which take place in the study of Indian call centre.

Foucault’s distinction between the “traditional” and “disciplinary” modes of domination brought a new era in critical theory. In instrumental management even in the more paternalistic strategies such as HRM, discipline, instruction and punishment has targeted the mind, the soul and the will of employees. This has been connected to the “carceral” institutions and unfolds the non-traditional view of power such as training, discipline routines, close observation, discourse, and strict-autonomy. For Foucault this is the new way to turn the body in a trainable machine in order to learn “how to live and work with other people” (Foucault 1977c: 28)[xii]. Through the interview it is easy to find facts of attendance recording via log-in log-out systems, coercive early arriving and the require reports before the shift, which are all great paradigms of exercise of disciplinary power and perform routine. These instrumentals aim to the reformation of behaviour, attitude and values of employees who under these repetitive manners are called to follow the organisational culture and code of conduct. Foucault thought discipline in two different forms; one is punishment and the other the body of skills and knowledge; which are both associated with the techniques of ITES organisations. Just like carceral asylums, which have their internal legal systems where years can be added or diminished on their penalty, similarly in the interview there are several signs of such psychological extortions. The fear of dismissal, termination of contract or re-training (which is taken more as a suspended dismissal) is spread all over the interview. The reason for such conduct must not always be “reasonable”, such as unsatisfactory performance, even the leaving of the seat or excess call waiting can be enough for a personnel to yield, humiliate or throw out an employee. In addition these actions are reflected in non-verbal disciplines since by causing a heavy and uncomfortable atmosphere is more like a sort of warning punishment upon all the rest of employees who may dare not to comply with the rules. In addition Foucault’s influence by Bentham’s design of the Panopticon, emerge new perspectives upon discipline and managing which are surveillance and observation. Through stations in central points on the call floor, the feeling of surprise quantitative and qualitative analysis of the call recordings, call barging and side jacking, as well as personnel to walk across the room, creates an everlasting sense of the authoritarian gaze[xiii]. This is also enhanced by all the technology used in the organisation which turn ITES companies in an electronic Panopticon which control everything, time, space, behaviour even the way employees speak. Furthermore, the several technology-based systems related to task performance, which transform each one of them in individual “cases” for examination, compare and evaluation gives the availability of monitor and discipline even in the absence of a personnel. Another extend of Foucault’s thought is the concern upon heterogeneity and homogeneity and in what extent organisations in general share homogeneity. Since ITES organisations, like the one in the case study, share similarities in management strategies, socio-political and organisational culture there is a spread of normalisation, which upon Foucault is a great instrument of power. This normalisation seems to be one of the main reasons, which employees tolerate harassment, oppression and psychological violence and tend to characterise it as “professionalism” or blame SLA for their personnel behaviour. The demystification of “the independence and self-reliance” that the high income offers to employees, seems more like an Utopia in a society which look in favour organisations which give “changes in self-concept”. Last but not least, Foucault’s references on the relation of knowledge and power is highly visible across the content of the case. The essential procedures of English accent, the strategic trainings in emotional labour skills, cultural training and the organisational hierarchy which mirrored on obeying supervisors and their legitimise are what Foucault explore as power in the form of demarcations and systems of discourse (Foucault, 1980)[xiv].

Further on, since labours in such kind of organisations have become instruments of the managerial power and discipline, Marx’s ideas upon alienation and exploitation can give a different prism in oppression, which is that of political economy. Through Economic and Philosophical Manuscript, Marx identified four types of alienation, a systemic result of the capitalism and its mode of productions, which abut in the estrangement of human beings towards their nature, society, satisfaction, acts of production or even on their selves. Thus upon Marx’s fundamental “premise” (Marx, 1978:155)[xv] that employees must work in order to survive and thus become slavers by selling their labour power to employers while on the same time to enjoy no control upon the production, is what is easily identified through the case study. As seen, the services of ITES and BPOs are wholly depend upon the clients[1] and according to their demands managers decide the management tactics and enslavement of resources (employees) in order to give the proper outcome. Employees perform zero control upon their product (service) since all they have to do is just to obey SLAs and fulfil their personnel directions. Consequently, organisation’s existence relies wholly on the integrity of its contractual relations with its clients. Therefore employees’ performance should result in the highest possible outcome, hence must implement diligently any managerial instrumentality, which would result according to SLAs’ expectations. This implies the exploitation of employees who automatically create a surplus value both for their patron (organisation) and the clients who seek to create business value through the cheap labour exploitation of Indian call-centres. Workers themselves become what Marx described as “commodity fetishism”; the social relationships between people become rationalized (Rubin, 1990:5)[xvi] and workforce becomes a commodity (Marx, 1978:320)[xvii]for both consumption and exploitation. Under a different perspective someone can argues that even personnel/managers themselves become part of this alienation, and become puppets of the Capitalistic resource allocation. Many employees seem to declare “they are just getting the work done”, “are just doing their job” and “our bosses also have no choice”. Under this standpoint, there should be no surprise if after a year or two any of those complaining employees show the proper commitment and patience, “seize” a management mask and become member of the exploiters. In addition, another facet of alienation is the one, which turn individuals against each other and reduce their social relation (Grint, 2010)[xviii]. Even their relationship with customers becomes rational and necessarily alienated with greatest example to be the phrase ‘Agents are not allowed to develop personal relationships with customers or display any partiality effective emotional labour’. Tension, mental strain and anxiety between workers and personnel has become a daily phenomenon while phrases like “there is no humanity in the call centre” and “we feel useless” to be reflected upon disruption of work-life balance and social life of employees. Further more, workers become subjects of their labour through high degrees of specialisation, repetitiveness and meaningless motion, which result in alienation from their tasks, depress, dissatisfaction and low morale. Uninterrupted call flows, incessant listening and speaking, which most of the times implies pretention of good mood, alongside with the daily and continuously use of the same technology conclude in several sensory-motor problems and “inanimate” motional responses.

A great influence to Critical theory and accordingly to most of its analysts and theorist is debt to Weber’s theories of rationalisation, bureaucracy and iron cage. The historical differentiation in Protestant and Christian perspectives, and suitably the distinction of salvation through spiritual slavery and material slavery is what mainly drove Weber in expressing his own view of the capitalistic prison and its rationality. As seen through the case study and the background research, India has become highly specialised in ITES/BPO services, and consequently it has an immediate impact on its workforce population, which becomes slaver of the high returns of this sector. Specialization for Weber is a boost of instrumental rationality (Weber, 2002)[xix] of the economic system and thus traps individuals in cages of teleological efficiency and control (Lassman, 1994)[xx].

The limited employment opportunities in other employment sectors, as descript in the text of D’Cruz and Noronha, has turned ITES-BPO in “the most viable mean for achieving a quality of life”. Thus more and more individuals in India find “Geist” in what Weber characterised as “rationalisation of life”. The self-esteem and image given to employees just by referring phrases like “customer care executive” or “customer care officer” drive them to become preys of instrumental HRM, training, oppression and bureaucratic control.

For Weber, the treatment and role of people as well as the rules, norms and terms, which work under, are the most specific characteristics to find evidence of bureaucracy. In an organisation like MNC where people are forbidden to be member of Trade unions and the obligation to follow the organisation’s “legitimate authority” of specific rules and duties reflects in an anomie of employees rights, lack of autonomy and internal democracy. Furthermore, the supervisory approval (if given) to go to the toilet, the reinforcement even for the most humanised performances such as team outings, the highly techno-bureaucratic control and coordination through automated call distribution and computer telephony integration systems, are undoubtedly the fulfilment of the pre-referred characteristics of bureaucracy. Consequently, “there will be an evolution of an iron cage, which will be a technically ordered, rigid, dehumanized society” (Weber, 2003:356)[xxi]. Therefore a naturalized prison of electronically operated doors, of minor brakes, no overtime, transactional psychological contracts of employment and the dehumanizing of individuals as “cogs in the machine” (Calhoun 2002:167)[xxii]become part of the job,just because “clients’ expectation have to be met”. In addition, the various performance control and measurements of the organizations absolutely reflect Weber’s theory of value-based control and constitutive rules (Weber, 1978)[xxiii].

In reference to rationality, Habermas introduces communicative rationality “owing to the mutuality of rationally motivated conviction” (Habermas 1984:10)[xxiv], where his critiques suggest the right criteria of the ideal communication. He coined a “battle” between the principles of instumentalization of reason, which linked to the maximization of output (management rationalisation), while on the other hand stands the practical reason and its emphasis on the removal of repression. Furthermore his “linguistic turn” focuses on the structures of discourses, communication and its’ subjectivity upon the person. Rationalisation for Habermas takes place within the “communicative action” (Habermas 1979:97)[xxv] of social system and/or “life-world” where the former is the complexity of world’s structure and its economic/hierarchical social system forces while the latter one allows individuals to be active and creative. According to Habermas instrumental rationality has dominated life-world and the way individuals view reality. Similarly employees in the call centres consciously, and without alternative choice, stand hard HRM (verbal/technological/scientific), customers bullying and abuse due to their ethnicity as well as linguistic and behaviour monitoring. This standpoint of Habermas has challenged Marx’s perspective of exploitation and alienation as to be the main reasons for oppression and he suggested communication as the key for morally and deliberative discourses across society. Conversely to the tradition meaning of life-world, organisations and society has created a new era, as pre-referred the systems-world, which just like the ITES-BPO, gave birth to highly instrumental and functional actions, which similarly to Habermas sayings, they rapidly develop an autonomous logic of their own (Alvesson M. , Willmot H. ,1999: 122)[xxvi]. These subsystems (organisations) are also guided through symbolic structures like financial benefits and profits. Likewise in the case study, honest and pragmatic bases for a truthful communication have been bury in the fear of dismiss and lose of economic benefits, with employees to be unable to answer back on the several mistreatments of either personnel or customers. This lost of honest can be even reflected upon agents’ actions like entering wrong customer email address in order not to proceed feedback in the case of not satisfactory performance or by altering their position in the call distribution call. Consequently, coerce of performance violates the norms of ideal speech and the ability of individuals to use logic and analysis. Thus it is easy to relate the phenomena of the case study with all the above theories with the internal systems and mechanism of steering threaten of life-world. Employees daily breach the prerequisites and pragmatics of communication action by lying even for their identity. The teleological actions they implement for the instrumental needs of the organisation is what Habermas draw as conflict and cooperation dependence on the self-interest (Habermas 1984: 101). In order to execute organisation’s wants employees not only try to apologise and to empathise to customers under pretention of emotional employee, they also have to adopt Western names and accent while has become natural for employees to sign non-disclosure agreements for their engagement in location masking. Thus Haberma’s two orientations, of success and understanding, become mutual exclusive in such organisations where employees, on the need of their profession, “tries to influence the decisions of rational opponent” (Habermas, 1984:287). In addition, managerial instrumentality, as well as organisation’s promises of promotion and further employment opportunities upon commitment and professional performance, distorts every possible aspect of Habermasian self-reflection. In reality, sensitivity, politeness, warmth and understanding of customer needs would fulfil the needs of an ideal speech, however the force of performance analysis and examination is what induces these features in such organisations.

All in all, analysing and exploring through the eyes of great theorist and critical management can result in an endless attack against management prerogatives and practices. Management has been turned to a profit maximization contest between “experts” and workforce. Critical theory is not nihilist against a scientific study (management), which has become an essential instrument of administration and day-to-day running. Organisational entities need managerial knowledge and exercise to both survive and serve the millions of stakeholders, their needs and wants. However critical management theory examines through the organisational society and its ideology the un-pragmatic differentiation and division, which is created through stereotype bias and asymmetry of power. Consequently with its findings aims to create “noise” in order to break the “socially structured silences” (Alvesson and Deetz, 2000)[xxvii] and its naturalization phenomena.

Internet sources: cited 22/01/2012

[1] Entities seeking services from the ITES

Freud, S (1928), The Future of an illusion, New York, Horace Liveright

Foucault, M. (1988) The ethic of care for the self as an ethic of freedom. In J. Bernauerand D. Rasmussen (eds), The Final Foucault. Boston, MA: MIT Press.

Habermas, J. (1974) Theory and Practice. London: Heinemann

Grey, C. and Mitev, N. (1995) Management education: a polemic, Management Learning , 26 (1): 73–90.

Horkheimer, M. (1976), Traditional and Critical Theory. In P. Connerton (ed.),Critical Sociology. Harmondsworth: Penguin

Horkheimer, M. (1989) The state of contemporary social philosophy and the tasks ofthe Institute for Social Research. In S.E. Bronner and D.M. Kellner (eds),CriticalTheory and Society. London: Routledge

Foucault, M (1977b) discipline and punish: the birth of the prison, London: Allen Lane

Hegel G. F. W. (1977) Phenomenology of spirit, trans. A. V. Miller, New York : Oxford University Press

Berendzen, J. C. (2009) ‘Max Horkheimer’, Stanford Encyclopedia of Philosophy p. 16, available at

Horkheimer M. (1974), Eclipse of Reason, New York: Seabury Press, p.97

Freud, S (1961) “civilization and its discontents”, vol. XXI, London: Hogarth press and institute of psychoanalysis, 57–145

Foucault (1977c) Discipline and punish. Harmondsworth, Penguin

Foucault M. (1995) Discipline and punish: the birth of the prison, vintage, New York, part 3

Foucault, M. (1980) Power/Knowledge. New York: Pantheon.

Marx K. (1948) The German Ideology, in The Marx-Engels Reader. Edited by Robert C. Tucker (1978) 2nd Ed. New York: Norton, pp.155–6

Rubin I.I. (1990), Essays on Marx’s theory of value. Montreal: Black Rose Books, p. 5.

Marx K. (1867) Capital Vol. 1, in The Marx-Engels Reader. Edited by Robert C. Tucker (1978) 2nd ed. New York: Norton, p.320

Grint, K. (2010) The Sociology of Work. Cambridge: Polity Press

Weber M. (2002). The Protestant ethic and the “spirit” of capitalism and other writings. Translated by Baehr P.R. Wells C.G, Penguin

Weber: Political Writings (Cambridge Texts in theHistory of Political Thought). Ed. Peter Lassman. Trans. Ronald Speirs.Cambridge UP, 1994

Weber, M.(2003) General Economic History, Dover Publications,p 356.

Calhoun C.J. (2002). Classical sociological theory, Wiley-Blackwell, p. 167

Weber M. (1978), Economy and society, Guenther Roth and Klaus Wittich Eds. Berkeley: University of California Press.

Habermas, J. (1984) The theory of Communicative action. Vol1: Reason and the rationalization of society, translated by T. McCarthy. Boston: Beacon

Habermas, J. (1979) “what is universal pragmatics?”, in Communication and the evolution of society. London: Beacon

Alvesson M. , Willmot H. (1999), Critical Management Studies, London: Sage Publication

Alvesson, M. and Deetz, S. (2000) Doing Critical Management Research. London: Sage

Show your support

Clapping shows how much you appreciated George Philippou’s story.