OUCH! Character is the New Strategy

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Some time ago I was meeting with someone after a very cool meeting with a small group of people and she asked me, ‘Why do you think character is getting so much attention these days?’ I had never thought through my response before but what emerged was:

‘Because strategy has failed.’

It was one of those times where you think you’ve said something really important or completely stupid and you kind of hope the person you are with doesn’t decide which, too quickly. It’s also one of those times that illustrates transformative causality playing out during interaction, in this case between two people.

Since then I have thought quite a bit about that statement and while I might not state it quite the same now, I do think in essence it is true.  In many ways it simply represents a common, almost inevitable outcome of founding typical organization theory on the assumption that certainty can be produced by those in power.

That outcome is when the theory (or more accurately the models, tools etc. that represent it) fail, blame is assigned to either:

  1. The practitioner of the model or tool
  2. The model or tool being used.

The theory itself is rarely in the mix of being scrutinized.

Strategy however is a pretty big tool to be blamed.

In the last post I mentioned it took one colossal economic crash to begin to question strategy. That was 2008. There of course have been other economic crashes since strategy as we understand it became indisputable in organizations but none this large and none with current organization theory so firmly entrenched.

In 2008 thousands of businesses failed worldwide. None of those businesses had failure as a vision or as part of their strategic plan. In addition the majority of the thousands of senior people in those organizations had been educated or trained at Western business schools and likely had been influenced by a popular business guru. These gurus, for the most part promote typical understanding and theory of organizations (they must, otherwise we would have different theory and understanding)!

As noted in point 1 above the typical pattern of behavior when a business fails is to point to the incompetence of the senior people (the practitioners of the tool of strategy) of that organization either strategically or in the implementation of their strategy. Either way the cause of failure is incompetence.

In 2008 for this to be true, there had to be an epidemic of incompetence to a degree never before seen! It was highly problematic to blame so many people for being incompetent, especially if some of those people did their work in some of the most respected business institutions in the world!

In light of this you might think there would be some questioning of the theories on which organizations are thought to exist (including the theories of strategy). Unfortunately not much of that has happened in the past eight or so years. So what did happen that has allowed us to hold onto these theories founded in the assumption that power creates certainty?

  1. Blame a relatively small number of people as the cause of the whole crash and label those people as ‘bad’.
  2. From there shift the focus of the cause of business failure to something much more subjective than incompetence.

That something has become character.

This is an interesting, convenient and I think scary development for sustaining faith in current organization theory, including strategic theory. Interesting because it is brilliant in its support of current theory, even though it is highly unlikely anyone or any group actually came up with the idea. It is a wonderful example of emergent, socially constructed meaning that could not have been predicted.

Convenient because once you shift to a more subjective means of supporting current theory, you no longer need as much objective evidence to prove that theory; enough power of whatever kind will suffice (i.e. gurus, business schools, public opinion).

Scary for two main reasons. One, no longer is objective analysis of the viability of current theory nearly as important. Two, failure, which is almost guaranteed at some point if we believe that power produces certainty, now has a deeply personal cause.

No longer are you just incompetent if you fail, you have a flaw of character!

OUCH!

While we see this demand for character most clearly established at senior levels in organizations because of the power those people have the dynamic filters down throughout the entire organization.  Remember this dynamic is caused by a belief that certainty can be created by those with power and this effectively eliminates the bottom right arrow of the right loop and the left facing arrowhead of the gesture response in the interaction model.

Interaction Model

The bottom arrow in the right loop represents adaptation, the potential altering of intention through interaction. The left facing arrowhead is part of the dynamic of interaction where meaning (however difficult) emerges.

So let’s put this together. We now have a subjective and very personal cause for the success of the strategy of the organization; character. Now success is even more personal, now publicly personal. If you are the senior people in an organization you have enough power that you should be able to create certainty; certain strategic success.

So when that group sets the strategy for the company they are now being judged to be both competent and of good character; good people.

The pressure is enormous and the last thing that group wants to hear from anyone is that the strategy needs real adaptation. The last thing they want to hear is a response from someone that questions their competence or goodness.

To be very blunt for most people in organizations, eliminating the bottom arrow in the right loop and the left facing arrowhead in the gesture response translates to:

Do what you’re told and keep your mouth shut!

I sometimes think that this may be the cause of things like low engagement scores almost across the board in organizations, the dramatic increase in mental health issues in the workplace, escalating rates of turnover and so many other things that we say overtly or covertly that we so dislike about our organizations.

Perhaps we’re just trying different ways to run from the OUCH!

As character becomes more established as a measure and cause of strategic success I don’t think things will get much better.

I would be the first to say we need character in organizations, throughout the organization. Character as strategy, founded on the assumption power creates certainty is not character at all; it’s simply another tool in the service of current organization theory.

The next posts will look at what we can do with this thing called strategy, at all levels of our organizations. Perhaps how we can reduce the OUCH! rather than run from it.

Comment and discussion points for this point:

  1. Do you agree with the above?
  2. What do you think is the impact of character in organizations?
  3. Do you think character is in the service of creating certainty?
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