“Our theories and ideas have done much to strengthen the management practices that we are now so loudly condeming” Sumatra Ghoshal, 2005 in Academy of Management Learning, vol 4, no 1.
This short post is a reflection on Ghoshal’s observations on “the pretence of knowledge” and the scientific approach to management thinking and education.
Challenging dominant voices
It seems to me that a lot more humility and critical thinking is needed in the ongoing exploration of business thinking and management education. That includes willingness to reflect on past failure, the contribution of academic theories to that failure – as Ghoshal has already done – and the role of business schools and management gurus.
Ghoshal called out Agency Theory for particular criticism. This says that managers have to be incentivised to work in the interest of the shareholders. But bonuses have not stopped RBS and the Coop bank in the UK from making massive losses. The fact that both banks can continue to see bonuses as the way to entice the ‘talent’ they need to dig them out of the financial losses they’re currently experiencing is perplexing – to me at least.
I also think there needs to be much more challenge to the influence of dominant voices and institutions. So Big Business School X says something, Huge Consultancy Y says something else, and Gigantic Guru Z repeats it all. Oh really? And that makes it valid because?
If there is one thing business schools ought to be about, over all else, it is the development of skills and capabilities – the critique of content and not its absorption. Critical thinking and reflective practice: who is telling you what, why and what are they not telling you? Where are the vested interests? What’s their experience of what they are proposing – or are they full of opportunistic hot air?
Another academic paper I cannot recommend highly enough is Whittington et al’s Taking Strategy Seriously. Both Ghoshal’s paper and this one were written after Enron. Whittington et al say:
“The success of Enron’s bubble was in the extent to which it managed to engage the unwitting cooperation of so many other members of the (strategy) field in its own strategic manipulation. The point now is to promote the kinds of understanding and change that might make these kinds of mistakes less likely in the future.”
The ‘strategy field’ has in the past includes business schools, publishers and the management gurus, who all promote innovative ideas. It now includes informed bloggers like you and me. Whittington et al point out that although management teams consume the ideas from management gurus and business schools, they are not uncritical consumers. In my view, they need to be highly critical consumers.