In this statement, Ouchi talks about the various types of control that are found in human communities. He mentions clans, markets and bureaucracy.
Clans are commonly found in smaller societies, or in societies where people are connected by very clear and strong links. Family connections usually play an important role here, and this type of control relies heavily on group identification.
A second type of control is that of markets. Markets operate through a system of benefits. People are connected through convenience and by the possibility of mutual benefits.
The last type is that of bureaucracy, in which control is exercised by a group of people who operate as the civil service. Ouchi argues that this is the form of control that is less romanticized, but that is ultimately the most resistant and common, and thus, the dominant type of control.