"Organizational languages, coordination, and firm structure"
Matthew J. Sargent · Academy of Management Proceedings · 2013
This paper proposes and tests a new model for intergroup communication that offers a solution to the problem of coordinating the activities of specialist workers within and between firms. Previous research has described the emergence of technical jargons and codes which makes communications between specialists more efficient. However, as these languages become more tuned to the demands of a specific environment through the creation of specific vocabularies and shorthands, it becomes increasingly difficult for agents outside the group to communicate with those within it. Within an organization, the emergence of languages demands a tradeoff between specialization and coordination. This paper identifies a novel solution to these coordination problems. In many cases, I argue, coordination relies on the exchange of information on a very small set of topics rather than the full integration of two or more groups’ knowledge. Drawing on natural experiments derived from historical case studies, I demonstrate that under these circumstances, coordination can be achieved through the spontaneous and unmanaged development of a new mode of communication: a trade language or pidgin – an ad hoc, functionally limited language that enables the exchange of only information on a very small set of topics. While limited in scope, these functionally simplified languages are relatively easy for all parties to learn and serve the important function of allowing facile coordination between different groups. Building on historical examples, I demonstrate the existence of such languages through case studies, empirical data, and experimental games.