Wednesday, April 13, 2011

A Timeless Management Insight

John Kay, former director of Oxford' Business School, has captured a crucial yet counter-intuitive insight in "Obliquity: Why Our Goals Are Best Achieved Indirectly":
Mr. Kay begins with a provocative, profound and counterintuitive insight: When it comes to major goals, whether in life or in business, one can pursue them best by deliberately not pursuing them.
Happiness is one of those goals. Mr. Kay quotes John Stuart Mill, who framed what has come to be known as the happiness paradox: "Those only are happy . . . who have their minds fixed on some object other than their own happiness." Or, as Hawthorne said: "Happiness is a butterfly, which when pursued, is always just beyond your grasp, but which, if you will sit down quietly, may alight upon you."...
Mr. Kay's innovation is to pair this age-old paradox with a newer one, which he calls the "profit-seeking paradox" and sees in cases like Merck and GE. The idea here is that the best way for a business to maximize profits is not to seek to maximize profits. Mr. Kay's argument, which owes much to the economist Robert Frank, goes as follows. Consumers will purchase from your business, or employees will go the extra mile to contribute to your success, only if they believe that you care about their interests. The best way to establish that you care is to show that you can place their interests ahead of your own. In a recession, for instance, you take the hit and avoid layoffs. Then your workers will go to bat for you, giving you a 110% effort.
But, as Mr. Kay notes, something more is required. Even if you know that keeping workers on the payroll will elicit their over-the-top effort, the hope of gaining their over-the-top effort cannot be your motive for keeping them on the payroll. If your employees think that you care not about them but rather about the 110%, they won't oblige you by working harder. Paradoxically, then, to gain the 110% you must demonstrably not care about it.
In a few short paragraphs, this reviewer (borrowing from John Kay) has summed up something that Noman has been laboring to teach MBA's and executive students for the past two decades.  He would only correct the reviewer by noting that a manger can never "not care" about getting more, say 110%.  Subordinates might trust a non-ambitious maanger's intentions, but they could never trust his competence.  What a manager must demonstrate is that s/he cares about other things besides 110%, including subordinates' well-being, and the satisfaction of customers' real needs.

Noman learned this, and more, from a Spanish business professor named Juan Antonio Perez-Lopez, whose masterful insights were presented in two books that were unfortunately never published in English: "The Theory of Human Action In Organizations" (RIALP, 1991), and "Foundations of Business Management" (RIALP 1993).

Victor Frankl expressed a related point in "Man's Search For Meaning," first published in German in 1946.  Students invariably thank Noman for directing them to Frankl's book, which documents his work in logotherapy with fellow prisoners in Nazi death camps.  In fact, the book's original title in English was "From Death-Camp To Existentialism." (Beacon Press, 1959)
Apparently, man must have an aim toward which he can constantly direct his life.  he must accomplish concrete, personal tasks and fulfill concrete, personal demands; he must realize that unique meaning which each of us has to fulfill.  Therefore, I consider it misleading to speak of "self-fulfillment" and "self-realization."  For what is demanded of man is not primarily fulfillment and realization of himself, but, the actualization of specific tasks in his world - and only to the degree to which he accomplishes this actualization will he also fulfill himself; not per intentionem but per effectum.
 It is a joy for Noman that Kay has delved into profound truths and expressed them so clearly and convincingly.  He looks forward to reading the book, and hopes that many in business will, too.

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