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Bad Apples or Bad Barrels? An ecological perspective on ethics in management

In my last two blogs I have suggested that many of our institutions have lost their sense of purpose, as their means to success have steadily become ends-in-themselves. This loss of purpose has been accompanied by a steady increase in ethical lapses in management, which seem to have escalated hugely over the past few years.  During his presidency George W. Bush became well known for always attributing these deviations from ethical standards to “bad apples”. If people were greedy or stole or abused their power, he said, the problem did not lie with the system. It was just bad actors – “evildoers” – who were responsible for the problem – they should be investigated, arrested, tried and punished.

In Western thought this context-free perspective on human behavior can be traced back to Plato and beyond. In the business schools we can track it back to the efforts to professionalize the field of management in the late 1950s and to turn its study into a social science. The assumption was that people ought to be rational in a logical, context-free way. In an earlier blog I have described this rationality as similar to that of Mr. Spock’s of Star Trek. It was also assumed that people ought to be ethical in a context-free kind of way. Wherever they were and whatever they were doing, they ought to behave ethically. Individuals were thought to “apply” ethics to their behavior, in much the same way that managers applied management principles to organizations.  If individuals didn’t behave ethically, then the implication was that they were “bad” people. Hence the “bad apples” that GWB criticized.

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Posted in Change, General | Tagged bad apples, Douglas McGregor, ecological rationality, evildoers, figure and ground, George W. Bush, management ethics, MBA Oath, Mr. Spock, rational model, Theory X | Comments Off on Bad Apples or Bad Barrels? An ecological perspective on ethics in management

When Means Become Ends: Part II – the unintended consequences of outsourcing

My last blog suggested that many North American institutions have steadily lost their sense of purpose, as means have become ends-in-themselves. This weekend’s New York Times offered some more interesting examples of the many different ways in which the process works and the corrupting impact it can have on the institutions concerned.

The headline story in Sunday’s Times was entitled “Mangled Horses, Maimed Jockeys”. It chronicled the sorry state of horse-racing and revealed that 24 horses die each week on American racetracks as a result of an industry mired in a culture of drugs and lax regulation. The situation seems to have been made worse by the casinos and gambling activities that have become part of most racetracks. Higher purses encourage trainers to race unfit horses and to mask their injuries and defects with large doses of drugs of all kinds. With no significant consequences for drug use, the vicious spiral continues. In England, where all and any drug use is banned, the breakdown rate is half that in the United States.

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Posted in Change, General | Tagged institutional purpose, means and ends, outsourcing, privatization, Republican Party | Comments Off on When Means Become Ends: Part II – the unintended consequences of outsourcing

When Means Become Ends: Have our institutions lost their sense of purpose?

Forty years ago going to business school in the Western World, with a view to becoming a manager, was seen as an honorable endeavor. Back then we believed that management was a calling; a practice that had the potential to become a profession. How the world has changed since then! Today, as the Dilbert cartoons constantly remind us, those high aspirations have been lost. In the words of HBS Professor, Rakesh Khurana, we have gone from “higher aims” to “hired hands”, where the objective of getting an MBA is to land a well-paid job and a ticket to personal success and power. What counts now are the exclusivity of the institution one attends (and thus the rigor of its selection process) and the social networks one assembles there; everything else is secondary.

Khurana’s fine book, From Higher Aims to Hired Hands is quite excellent and a must-read for any student of management or management education. I have made use of his research in The New Ecology of Leadership. In today’s blog I want to suggest that the process of decline that Khurana outlines in the American business schools can be detected in many other North American institutions, including its corporations. This organizational decline takes the form of the steady replacement of the essential dialogue within the organization between ends and means, with a focus on means alone. As the institution loses its sense of mission and purpose, its people and processes become steadily fixed on the means to personal success and power at the expense of the original aims that lead to the organization’s founding.

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Posted in Change, General | Tagged business schools, conflict of interest, ecological mental model, Friedrich Hayek, incentives, markets, means and ends, measurement, muppets, purpose, shareholder value model | Comments Off on When Means Become Ends: Have our institutions lost their sense of purpose?

The Ecocycle: A Mental Model for Understanding Complex Systems

I found this evocative image a short time ago. It captures the intention and spirit of the book admirably: three dragons – I have named them Passion, Reason and Power – scramble on a Moebius strip in a never-ending three-cornered struggle of the rock-paper-scissors variety. In the picture Reason is taking a snooze, leaving Power and Passion to duke it out – an apt description of the current American political scene! The “detuned” version of this in The New Ecology of Leadership is called the “ecocycle”. It is the heart of the new ecological mental model for making sense of the behaviour of complex systems. It was developed originally as the “adaptive cycle” by the Canadian ecologist, C.S. “Buzz” Holling, to understand the dynamics of ecosystems like forests and estuaries. I have spent much of the past twenty-five years or so adapting it for use to understand human organizations, especially private and public-sector organizations and, to a lesser extent, other groupings like cities and societies.

It must be emphasized that the ecocycle is a mental model that allows the user to anticipate what might happen in a particular organization not to predict. Anticipation, of course, often allows one to take pre-emptive action thwarting the predictions of others! So managers should always prefer anticipatory frameworks to predictive ones; prediction implies inevitability, anticipation leaves one the capacity to take action. Used in combination with other frameworks from several fields, including management, psychology, sociology and philosophy, the ecocycle yields stunning insights into the dynamics of complex systems.

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Posted in Change, General, Leadership, Strategy | Tagged adaptive cycle, anticipation, Chapter 11, complex systems, creative leadership, destruction, ecocycle, ecosystem, General Motors, infinity symbol, Kodak, logic, mental model, Moebius strip, moment of Now, power, prediction, Rochester, social traps, strategic management, sustainability, sweet zone, trust | 2 Comments

Contextual Intelligence: A String in the Labyrinth

This week’s interim blog marks the posting of the Introduction to The New Ecology of Leadership as an excerpt.  What follows below is an extract from the introduction that identifies seven rewards for reading the book:

Changing a legacy computing system is a scary affair; even rearranging an office filing system can be a challenge. Adopting a new mental model can be still more daunting. However, this is the essence of teaching and learning. It’s easiest when you are young and your models are unformed; then the process seems natural. As we age and our experience becomes fixed in the form of habits, learning becomes more difficult. If our habits are strong and have fueled a sense of competence and power, then learning can feel disruptive, threatening, and downright subversive! Changing habits takes a lot of commitment, persistence, and practice. So why should you invest your time and energy in reading this book? Continue reading →

Posted in Change | Tagged architecture of choice, change, context, contextual intelligence, design of choice, ecological perspective, emotion and power, mental model, stability and change, stories, sweet zone | Comments Off on Contextual Intelligence: A String in the Labyrinth

Practical Wisdom: Homer 1 Spock 0

In his book Thinking, Fast and Slow, Daniel Kahneman, the psychologist who won the Nobel Prize for Economics in 2002, describes two great, fictional systems of human thought (fictional because they don’t actually exist as separate systems). System 1 is a fast-acting, automatic, associative system that continually looks for patterns. System 2 is slow-working, effortful, logical system, that can make complex calculations.  It’s the latter system that we associate with our reasoning, calculating selves. It is synonymous with the neoclassical economists’ (econs) view of what human nature ought to be.

In their seminal book, Nudge, which has become the “bible” of behavioral economics, Richard Thaler and Cass Sunstein liken System 1 to “Homer Simpson” and the econ’s System 2 to the hyper-logical “Mr. Spock” from Star Trek. The central message of all the work in this area is that, while Mr. Spock thinks he is in charge, Homer is the hero and trumps Spock most of the time. In the language of my book, Homer is rational but in an ecological way.  Ecological rationality can be thought of as synonymous with practical wisdom or “contextual intelligence”, as some have called it.

Homer’s victory has wide implications for all the social sciences, but nowhere more so than in the field of management, which fifty years ago set Mr. Spock on a pedestal and did its best to keep Homer shackled and chained in the  “iron cage” of bureaucracy.  Now the cage door is open. The chains have been broken. Homer is loose and about to run riot through the social sciences. Woohoo!

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Posted in Change | Tagged Cass Sunstein, ecological rationality, Homer Simpson, John Dewey, Kahneman, left wing libertarian, Mr. Spock, Nudge, power, practical wisdom, Richard Thaler | Comments Off on Practical Wisdom: Homer 1 Spock 0

Ecological Rationality: Coming Soon to a Website Near You!

In the dance of the seven veils (or is it seven dust covers?) that make up the pre-launch of The New Ecology of Leadership, the next scheduled event is the posting of the Introduction as an excerpt. I don’t have the final version just yet and in this weekly interim blog and next Tuesday’s I want to reflect, firstly on what the book tries to do and, secondly on who is going to love it and who is going to hate it. Because I think that the book is going to be sharply polarizing (assuming someone reads it, which is not always a good assumption!) In the spirit of a book that insists that context matters, a little history is in order:

For the past fifty years, ever since the attempt to professionalize the practice of management in the late 1950s, management theory has been based on a particular view of human nature. It is the view espoused by neoclassical economists that humans are (or ought to be) rational-agents, who maximized their personal utilities (don’t ask). Emotion was the enemy of reason and the objective of the business schools was to produce objective decision-makers, who could allocate resources to their highest use. Back then it was really like that…I can remember receiving a benediction to that effect at my graduation ceremony in 1972…

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Posted in General | Tagged agency theory, ecological rationality, emotion and reason, Ken Robinson, neoclassical economics, shareholder value model, transaction cost economics | 2 Comments

Good Questions Come Before Good Answers

A discussion topic posted early in 2011 on the LinkedIn Harvard Business Review Readers’ Group was “What is Key to Success?” What followed were over 600 comments from members all over the globe. I did a highly unscientific sampling and found about 25% from North America, 40% from India (reflecting, I suppose, the long association with England) and the rest from Europe and other countries. I didn’t see any from China.

While some questioned how to measure success and whether it could be pursued, almost all set out to answer the question and came back with the usual suspects: “focus”, “vision”, “passion”, “confidence”, “dedication”, “persistence” etc. etc. It was depressing. Not because these answers are “wrong”; on the contrary, they are “right”. The problem is that (like so much popular management advice) they are true-but-useless. More technically, they are abstractions made from observing “success” retrospectively, and as soon as one brings them into space and time prospectively, they give one no clue how to proceed. How do I/we  get focused, right here, right now? To what should I/we be dedicated, right here, right now? How? How do we tell persistence from obstinacy? And so on. The problem lies with the question:

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Posted in General | Tagged ecocycle, Fritz Roethlisberger, key to success, learning goals, performance goals, secret of success | 2 Comments

The Battle for Management’s Future Best Books for 2011

My interim blog for this week points to the addition to the site of my Strategy+Business essay, The Battle for Management’s Future.

My scope for these best books essays is “management”, narrowly defined, so it excludes categories like Leadership and Strategy that are covered by other writers. I reviewed Bob Lutz’ Car Guys vs. Bean Counters, Roger Martin’s Fixing the Game and Tim Harford’s Adapt: Why Success Always Starts with Failure.

I selected Roger Martin’s book as the best management book for 2011 because of its compelling analogies, bold recommendations and reasoned arguments. But all three books have much to commend them.

Posted in General | Tagged Adapt, Bob Lutz, Car Guys vs Bean Counters, Fixing the Game, Roger Martin, Tim Harford | Comments Off on The Battle for Management’s Future Best Books for 2011

Growing People: Give head and elbow room

How does one develop senior people? The evidence is rather clear from sources as far apart as the Center for Creative Leadership (CCL) and the consultants, McKinsey. At CCL they have found that the best preparation for a senior role in any organization is experience. Certain kinds of experience work better than others. Challenging assignments, significant bosses and reversals of fortune – hardships – are the best teachers. Only the first two have to be planned…

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Posted in General | Tagged Andreas Kluth, bad bosses, Center for Creative Leadership, Chris Anderson, crisis, ecocycle, elbow room, flawed bosses, fractal, head room, job structure, learning from experience, McKinsey, The Economist, turnaround, Wired magazine | 1 Comment ← Older posts Newer posts →