a) Organisation theory
b) Counterterrorism, intelligence, effectiveness
IV. Centralising / Decentralising the Intelligence Community
1. Structure has nothing to do with Counterterrorism Intelligence effectiveness
2. Does centralisation make efficient intelligence?
3. Control variables
b) Decentralisation, network, effectiveness
“Politically, reorganisation is often regarded as a panacea for curing a variety of administrative and political problems…these reorganisation efforts are almost invariably couched in the rhetoric of orthodox administrative theory: to facilitate the efficiency and effectiveness of bureaucratic hierarchies.”
“Presidents may seek reorganisation to break up subgovernments…to provide the appearance of decisive action, …or to reward a supportive interest group”.
“Thus political organisations become “garbage cans” into which groups and individuals dump their preferred solutions to poorly defined problems”.
Subsequent to the 9/11 terrorist attacks, a sustained effort has been undertaken to reform the American intelligence agencies. The establishment of a terrorism “czar”, with more authority than the Director of the CIA used to have as coordinator of the intelligence enterprise and with a supporting bureaucratic structure to this end should lead to more unified, coordinated and effective intelligence, in particular in the context of counterterrorism. The Intelligence Community has undergone previous organisational “centralisation” reforms, and yet, it failed to provide timely and accurate intelligence about the 9/11 terrorist threat. A series of legitimate questions therefore arise: is centralisation the wrong solution to the problem of intelligence effectiveness? Is rather decentralisation the key? Has structure any influence on the way intelligence agencies perform? Answering these questions would reveal whether the adjustments to the structure of the Intelligence Community are justified or, on the contrary, determined by empirical fallacies, such as the “quick-fix” reorganisation syndrome. In a broader context, it would be also useful to know whether and how the effectiveness of counterterrorism intelligence could be improved by means of organisational structure.
This research question implies the scholarly literature of two disciplines: organisation theory and political science (International Relations and Security Studies – Terrorism). The nature and functioning of organisations, in particular, decentralisation and its effects on effectiveness have been studied at the level of business and bureaucratic organisations, whereas studies on intelligence and its effectiveness are present within a broad range of security studies areas, including the newer – terrorism/ counterterrorism. Answering the above research question would therefore mean applying theories and evidence in the organisation theory and organisational behaviour literatures to the terrorism/ counterterrorism one.
The paper will be therefore divided into three sections: theory, the highlights of the intelligence reform, in particular the status and authorities of the Director of National Intelligence and, finally, the insertion of organisational features determining effectiveness into the context of counterterrorism intelligence. This section will gather arguments for the concept of “network”, as ideal structure ensuring counterterrorism intelligence effectiveness, but not before investigating the null and counterhypotheses: “structure has nothing to do with effectiveness”, and “centralisation ensures effectiveness”, as well as two control variables: human intelligence and technology.
a) Organisation theory
Organisation theory deals with “the structure of coordination imposed upon the division units of an enterprise.” Classical organisation theory defines organisations as “complex social systems with well-defined, established procedures, processes, and patterns of interpersonal relationships.” Organisational features which are vital for the understanding of how organisations function include: specialisation, routinisation and organisational culture.
A centralised organisation is one that “links related tasks at successive levels all the way to the top.” The ways to measure centralisation are, among others: the involvement of top management in making decisions and the control over executing decisions, the discretion invested in first-line supervisors over budgets, hiring, firing, performance evaluation systems and rewards, purchasing and establishing new projects, or the degree of formalisation. Effectiveness is defined as the attainment of prescribed purposes, assuming that the organisation and its decision-makers are rational and that the goals are clear. Decision-making is determined, according to Graham Allison, by the “logic of appropriateness”: “Actions are chosen by recognising a situation as being familiar, frequently encountered, type, and matching the recognised situation to a set of rules.” It follows that changing rules and procedures could only happen incrementally: “As new situations arise, the construction of an entirely new program is rarely contemplated. In most cases, adaptation takes place through a recombination of lower level programs that are already in existence.” The ways to “infuse” flexibility include: collaboration across organisational boundaries, alliances with the private sector, the institution of new processes and the recruitment of people with broad, transferable skills.
Classical theory of organisations argues in general for centralisation as the adequate structure to reach effectiveness, due to several advantages: coherence of action by eliminating loyalties to local constituencies, lower costs by doing away with expertise duplication , maximisation of hierarchical control and increased accountability, since top management is responsible to an elected official and accountable to laws democratically made.
Decentralised structures entail faster and better decisions, because they are made by those with the best and most immediate knowledge of problems, improve the quality of personnel, morale and motivation, ease burdens of communication channels and are more susceptible to change and innovation. “By encouraging diversity, decentralisation may also encourage innovation through experiment…by multiplying centres of decision, and access for sources of suggestion…by reducing the uses and scale of bureaucracy, decentralisation may diminish resistance to change.”
Beyond the advantages and disadvantages of the two types of organisational structure, there are special cases in which centralisation is not recommended: differentiation of units and complexity, leading to management overload and diseconomies of scale. Lawrence and Lorsch show that, when units, because of their particular tasks are highly differentiated, it is more difficult to achieve integration among them than when the individuals have similar ways of thinking and behaving. Centralisation of big and complex organisations might entail management overload: “There are limits to the manager’s knowledge, energy and psychological resources. The more managers defy their limits by increasing their span of control, the more they risk overloading themselves.” and diseconomies of scale. The latter are characterised by a very slow decision-making process “if most of the significant management decisions are made by those at the top of the hierarchy, the decision process slows down significantly – time lag – caused by the distance information has to travel and the volume of decisions to be made”. In addition, information will reach the top level, distorted: “inadequate, and frequently self-serving”. These eventually result in reduced central authority due to the lack of information:
“In a complex and changing environment …executives at the top of the organisational hierarchy find it increasingly difficult to understand “what’s going on” in the specialised units which the organisation has created to survive in a complex task environment. They may have the legal authority to manage these units, but they do not have the information or skills to exercise the situational authority required to do so.”
Organisational change means the redistribution of power within the structure of an organisation, significantly altering the traditional practices that the power structure uses in making decisions. The conditions for change follow a three stage process: unfreezing, moving – introduction and implementation of the change, and refreezing. The reasons for reorganisation are generally growth, major changes in goals and objectives, new technologies and new management techniques, changes in the work force: increased or decreased qualifications of personnel, or unionisation, changes in the organisation’s environment: increased hostility, increased or decreased resources, increased clientele demands, or changed social needs. Organisations generally resist major change, unless determined by major environmental change: “Evolutionary, incremental change that requires only minor adjustments is most easily handled… major, abrupt changes in their environments force organisations to make major internal changes as the price of survival.” The reasons for resisting change are determined by the fix organisational culture, rules, regulations and standard operation procedures, customers’ resistance and the threat to some valued self-interest and the disruption of the network of interpersonal relationships and communication that members have established over time. Tolerance to change can be determined by experience with innovation, decentralisation of the power structures, a climate of trust between working groups and management and in cases of goal changes, rather than structural ones, as this ensures organisational survival. The initial effects of change are rather counterproductive: “Major structural reorganisation takes several years to shake down. In their first year or two, new departments are likely to be less efficient, not more; to display lower morale, not higher; to afford greater opportunities, not smaller, for error, confusion and scandal.”
 James G. March and Johan P. Olson, “Organising Political Life: What Administrative Reorganisation Tells Us About Government”, American Political Science Review, 1983, p. 282
 Seidman, “Politics, Position and Power”, 4th ed. New York, Oxford University Press, 1986, p. 25-27
 March and Olson, „Organising Political Life“, p. 286
 Luther Gulick, „Notes on the Theory of Organisation“ in L Gulick and L. Urwick, “Papers on the Science of Administration”, Institute for Public Administration, New York, 1937, p. 7
 Florence Heffron, „Organisation theory and public organisations“, Prentice Hall, 1982, p. 153
 “organisations create capabilities for achieving humanly-chosen purposes and performing tasks that would otherwise be impossible…by specialising according to function, and training members of the organisation to perform in a routine fashion.” Graham Allison and Philip Zelikow, “Essence of Decision: Explaining the Cuban Missile Crisis”, 2nd ed., Longman 1999, p. 145
 “existing organisations and their existing programs and routines constrain behaviour in the next case: namely, they address it already oriented toward achieving whatever they do.” Allison and Zelikow, “Essence of Decision…”, p. 145
 “organisational culture emerges to shape the behaviour of individuals within the organisation in ways that conform with informal as well as formal norms. The result becomes a distinctive entity with its own identity and momentum.”, Allison and Zelikow, “Essence of Decision…”, p. 145
 Emmette Redford and Marian Blissett, Organising the Executive Branch, Chicago: University of Chicago Press, 1981, p. 4
 Heffron, „Organisation theory and public organisations“, p. 33
 Chester Barnard, “The Functions of the Executive”, Harvard University Press, Cambridge, 1938
 James G. March and Herbert A. Simon, “Organisations”, 2nd ed., Cambridge: Blackwell Publishers, 1993, p. 8, cited in Allison and Zelikow, “Essence of Decision…”, p. 146
 March and Simon, p. 170, cited in Allison and Zelikow, “Essence of Decision…”, p. 152
 Mark G. Popovich, ed., “Creating High-Performance Government Organisations”, Jossey-Bass Publishers, San Francisco, 1998, p. 12
 Mark G. Popovich, ed., “Creating High-Performance Government Organisations”, p. 19
 Heffron, „Organisation theory and public organisations“, p. 34
 Emmette Redford and Marian Blissett, Organising the Executive Branch, Chicago: University of Chicago Press, 1981, p. 4, cited in Heffron, p. 34
 Heffron, „Organisation theory and public organisations“, p. 33
 Robbins, Organisation Theory, p.88, cited in Heffron, p. 33
 Paul R. Lawrence and Jay W. Lorsch, “Developing Organisations: Diagnosis and Action”, Reading, Mass.: Addison Wesley Publishing Co., 1969, pp. 12-13, cited in William Medina, “Changing Bureaucracies: Understanding the Organisation Before Selecting the Approach”, Marcel Dekker, Inc., 1982, pp. 24
 Medina, “Changing Bureaucracies…, p. 24
 Medina, “Changing Bureaucracies…p. 24-25
 Henry D. Kass, Morley Segal and William Haskett, „Organisation Theory and Ideology: The Dispersion of Power in Complex Organisations”, paper delivered as American Society for Public Administration National Conference in Denver, Colorado, April, 1971, cited in Medina, p. 25
 Medina, “Changing Bureaucracies… p. 26
 Larry E. Greiner, „Patterns of Organisation Change“, Harvard Business Review, Vo. 43, No. 3, May-June 1967, 122-124
 “recognition by the key actors of a performance gap that threatens the organisation…some type of crisis, financial or otherwise, will be required to convince the organisation that change is necessary” Jerald Hage, „Theories of Organisation“, New York: John Wiley, 1980, p. 212-7
 Introduction of the change means the development of an idea or plan to improve performance or cope with the crisis. “It requires a clear understanding both of the source of the organisation’s problem and of what type of change is needed to solve the problem.” Implementation of the change determines resistance from the organisation’s members: passive – reluctance and unwillingness to cooperate; active – disagreement about the change. “The greatest conflict is most likely to occur when those who have proposed the change perceive the performance gap and the other members of the organisation do not. Excessive resistance or conflict which is not dealt with successfully may result in the nullification of the change effort.” Heffron, „Organisation theory and public organisations“, p. 157
 integration of the change in the organisation’s culture and behaviour; unwise to evaluate the change prematurely; the more radical the change, the more time it needs to be routinised.
 Heffron, „Organisation theory and public organisations“, p. 167
 Heffron, „Organisation theory and public organisations“, p. 153
 “structural change may disrupt established and values interpersonal relationships or change the status, power, or compensation of individuals in the organisation. Similarly, technological change may be viewed as implied criticism, wounding workers’ self-interest.” Heffron, „Organisation theory and public organisations“, p. 154
 Heffron, „Organisation theory and public organisations“, p. 166
 Heffron, „Organisation theory and public organisations“, p. 155-156
 Peter Szanton, „So You Want To Reorganise the Government?“ in Szanton, ed. Federal Reorganisation: What Have We Learned?”, Chatham, N.J.: Chatham House Publishers, Inc., 1981, p. 19