Question

Question 3.

According to Robert Michels, “Who says organization, says oligarchy”. With reference to theory and examples, explain the concept of oligarchy and how this might be seen in action in organisations.

Answer 1

Oligarchies are organizations that are controlled just be a few individuals or few businessmen. These few individuals have substantial powers in their hands so as to run the organization as per their ideas, their management practices and their benefit. This may lead to exclusion of other members who do not enjoy substantial powers.

We can see that large companies are practically run be executive elite while start-ups are being run by their founders. Take the example of large companies like Facebook or Amazon. In the case of Facebook, it is Mark Zuckerberg and his team of elite executives who practically run the organization. The shareholders of Facebook were not able to intervene and prevent the privacy issues and controversy that Facebook is currently drawn into. Zuckerberg, in the recent congressional and senate hearings, had to admit that the privacy issues were his mistake. Had Facebook not been an oligarchy other executives, as well as shareholders, would have implemented policies to prevent data privacy issue.