No theory forbids me to say "Ah!" or "Ugh!", but it forbids me the bogus theorization of my "Ah!" and "Ugh!" - the value judgments. - Theodor Julius Geiger (1960)

Organizational Prestige

The Significance of Public Image

An organization's public image has a significant impact on its internal dynamics. Shaping the public image is important. Organizations rely on their environment for various resources, including charters to operate, personnel, revenue, and funds. This dependence on the environment can limit an organization's autonomy. To increase autonomy, organizations can either reduce their dependency, which is often not feasible, or control it by creating a positive public image. Creating and maintaining a favorable public image can lead to several benefits, such as attracting personnel, influencing legislation, gaining informal power in the community, and ensuring a steady flow of clients, customers, donors, or investors.

Prestige Based on Intrinsic and Extrinsic Characteristics

Organizations with predominantly favorable public images have a certain prestige in contrast to their competitors with a less favorable public image. Prestige can be based on either intrinsic or extrinsic characteristics of an organization's goods or services. Intrinsic characteristics are essential to the organization's official goals and production standards, while extrinsic characteristics are not directly related to production standards but can influence public perception.

In cases where the target audience cannot directly assess intrinsic qualities, organizations may use endorsements or certifications from qualified groups to validate their prestige claims. Strategies for promoting prestige based on intrinsic qualities require more effort and are primarily used to maximize prestige based on intrinsic characteristics.

Intrinsic Referents for Prestige

The marketing of intrinsic referents is the preferred basis for prestige when an organization's goods or services can be evaluated by a specific group capable of judging their essential quality independently. In cases where the official goals of an organization cannot be readily evaluated by clients or donors, promoting prestige based on intrinsic quality becomes more complex.

Organizations or groups with the appropriate expertise and resources to validate claims of intrinsic quality can test or use the product and provide their approval, which needs to be publicized to validate the claims. Overusing or indiscreetly using such validations can endanger the prestige of the validating groups themselves, potentially leading them to limit or forbid marketing of their evaluations. Conflicts can arise when organizations attempt to use validating groups or medical journals to validate their prestige claims.

In cases where goods or services are highly technical or experimental and cannot be easily evaluated, organizations rely on indirect indexes of intrinsic quality. These indexes include factors like the reputation of personnel, specialized equipment, and the number of research projects. For example, in a hospital setting, statistics on the amount of free care provided to patients and the teaching program's quality can serve as indirect indexes. Reliance on these indirect indexes can sometimes lead to a subversion of quality, as organizations may prioritize these indexes over actual quality, potentially compromising the services they provide.

Using Extrinsic Referents

Organizations need to use extrinsic referents to enhance their prestige when faced with competition from other organizations for the support of clients, consumers, or donors. Extrinsic referents become crucial, especially when dealing with mass-produced products of equal quality, as they allow organizations to differentiate themselves. This differentiation can occur in various aspects of the organization, such as product design, packaging, interactions with target groups, and advertising.

Exploring Extrinsic Characteristics

Organizations, both competitive industries and monopolies, explore extrinsic characteristics to influence public perception and enhance their images. Successful organizations may align their themes more closely with societal values, implying a stronger claim for support.

In the context of a hospital, which relies on support from donors, physicians, and patients, competition can lead to a reliance on extrinsic referents. For example, hospitals may use human-interest stories in the media, emphasize amenities to attract doctors, and focus on superficial aspects of patient care, which patients can judge, to enhance their prestige.

Patients are often unable to judge the quality of medical care they receive but can evaluate aspects like the comfort and "hotel-like" services provided by the hospital. Hospitals invest in creating extrinsic items that patients can evaluate, such as extended visiting hours, amenities like beauty salons, and improvements in comfort and convenience.

Public Relations Departments

Many hospitals establish public relations departments to shape their external image and stimulate innovations. These departments aim to increase occupancy, donations, and overall prestige. While they have achieved success, they have also faced criticism both internally and externally. Shaping external perceptions is often the explicit responsibility of public relations departments, but other individuals or groups within organizations may also contribute to this effort. Individuals or groups assigned to public relations functions within organizations may also engage in bargaining and political functions that may not be directly related to organizational prestige but are part of the overall effort to manage external perceptions.

Internal Problems with Extrinsic Promotion

Internal problems can arise within an organization when there is an emphasis on promoting extrinsic details for prestige. These problems often stem from the allocation of resources and the conflict between various groups within the organization. When an organization focuses on extrinsic details like amenities, publicity, or other peripheral activities to enhance its prestige, internal personnel may object. They may argue that resources are being diverted from essential activities related to the organization's core goals. For example, at a hospital, staff members complained about the emphasis on amenities and publicity, which they saw as detracting from the core mission of patient care.

Handling Multiple Dependencies

Organizations often rely on various groups for support, each of which responds to a specific type of prestige. This can lead to conflicts and challenges. In the case of the hospital, it depended on local donors and national agencies, each with different expectations and views on what constituted prestige. Such conflicts can create internal tension within the organization.

Subversion of Official Goals

Efforts to control dependencies through the promotion of organizational prestige can sometimes subvert the organization's official goals. The production of indirect indexes of prestige may take precedence over maintaining the quality of goods and services. Or, resources may be redirected from activities supporting official goals to those that produce and market extrinsic characteristics. Also, multiple dependencies may interfere with the organization's ability to market either intrinsic or extrinsic referents, creating conflicts within the organization.

Decisions Shaping Organizational Character

Decisions related to prestige, resource allocation, and marketing methods can shape the organization's character and priorities over time. Organizations may prioritize activities that enhance prestige, even if they are not directly aligned with their official goals. This can result in a misalignment of resources and efforts.

Conclusion: Complex Challenges in Controlling Dependencies

So, organizations face complex challenges when striving to control dependencies through the promotion of prestige. Balancing the need for resources, managing conflicts, and maintaining alignment with official goals is a delicate task for organizations seeking to enhance their image and support.

Ref.

Perrow, C. (1961), Organizational Prestige: Some Functions and Dysfunctions, in: American Journal of Sociology, Vol. 66, No. 4 (Jan., 1961), pp. 335-341.

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