Fundamental

Looking beyond the obvious

I Wouldn’t Normally Do This Sort Of Thing

PWC UK announced this week that they will use tracking data on their employees to make sure they are spending three days a week either with clients or in a PWC office.

Most weeks I would rant about how idiotic this policy is and how it infantilises their employees and will be counterproductive (which is all true!) but if you’re a regular reader you can probably do your own rant (mine would be more cutting and funnier, obviously!).

But I’m a bit bored at commenting on the lemmings as they run towards the cliff and joyfully embrace their oblivion. The more interesting question is why they are doing it, despite the fact that they have been told where the cliff is, what will happen when they go over it, and the irrefutable outcome of their inevitable contact with what’s at the bottom of the cliff.

(Before any pedants point it out, I am aware that lemmings don’t actually chuck themselves off of cliffs but it’s a widely-known and powerful analogy, so I’m going to use it anyway.)

These are intelligent, experienced, well-educated people who run PWC. They must think that what they are doing is the smart thing to do. What logic leads them to this conclusion that is is evidently wrong? (I use the word ‘evidently’ advisedly, as there is actual evidence that enforced RTO policies like this are bad for morale and productivity).

Whilst some of the reporting on this has been negative, it’s mostly been reported neutrally, as a normal business practice that’s perfectly acceptable. So there’s some sort of orthodoxy of thought here, a set of beliefs about business that allow for a decision like this.

(It should be noted that a few months PWC tried to implement a ‘secret’ layoff programme, where they told sacked employees how to leave without anyone noticing! This is one wierd set of beliefs.)

This management orthodoxy is deeply ingrained in business and is incredibly narrow. For all the fluff that PWC spout about the importance of face-to-face working ‘in a people business like ours’ and ‘our focus on client service, coaching and learning and development’, the underlying logic is incredibly reductive. And we know what it is, it’s the logic of the factory.

More hours = more productivity

More productivity = more profit

Employees must be supervised closely

Work is linear and predictable

Manage what can be measured

Workers must fit the needs (and wants) of the company

I suppose for an organisation that started out as a bunch of accountants, this reductive view that obsesses with the numbers is understandable. But for a consultancy that is supposedly helping organisations grow and develop, it’s not.

They’ve also added a bit more false logic

Proximity = relationships

Whilst it was true in the past that you had to meet with people physically to develop relationships, this is clearly no longer the case. Putting people together does not mean they connect with each other, collaborate, learn and all that other good stuff. Especially when half of them are pissed off at being dragged into the office to sit on video calls with colleagues and clients who are in other parts of the country and the world.

The problem here is not that PWC, and all the other idiots I’ve ranted about over the past several months (well, years, really) are making stupid decisions. The problem is that their logic, their ‘wisdom’, is singular, limited and faulty. The management orthodoxy they follow is deeply flawed and maladapted for today’s environment.

The decisions people make are never stupid in their own mind. They always have a reason, there’s a logical path that leads them to the wrong conclusion.

The solution for PWC and their ilk is not to stop making stupid decisions because, to them, they make sense. The solution is for them to change the way they think about the world, to look at other perspectives, other knowledge traditions, and come up with a different way of thinking.

Then they have a chance of making better decisions.

Dreamland

I’ve been fascinated with seeing other perspectives and other belief systems since I studied Social Anthropology at university. My main subject was Economics but it was Social Anthropology that really opened my eyes. (Ironically, Economics has succumbed a narrow orthodoxy, neo-classicism, that is causing many of the problems of today and also underpins the reductive business logic I refer to above.)

The early anthropologists were often white Europeans and Americans who went to study what they considered ‘primitive’ societies. Whilst they explored and explained the different ways in which these societies viewed the world and the things they believed about it, those findings were seen as interesting but not relevant to our ‘advanced’ societies. Clearly, we had a logical and reasoned view of the world and had nothing to learn from these backward peoples.

One of the things I studied was the role of witchcraft in Ashanti society. It’s just hocus-pocus, right? Looking at the entrails of a chicken doesn’t do anything, obviously!

Hmm, have you heard of the placebo effect? Giving people a sugar pill that they believe is a therapeutic will make some of them better. Not just mentally (i.e. perception of pain) but in a noticeable, physical way. The effect is at least 15% but can be as high as 72%! There are treatments coming on to the market today that have been through the drug approval process and are sold at a premium that are barely more effective than a placebo.

Who’s believing in witchcraft here?

There’s a growing interest in what are now called ‘indigenous knowledge systems’ or ‘traditional knowledge systems’,s as we come to realise that maybe we don’t have all the answers (or, as it feels sometimes, any of the answers). These knowledge systems contain wisdom that has developed over millennia and supported societies in some very hostile environments, where your average punter would not survive more than few days.

In this week’s Drinking Dialogues, Nicola Robins shared how she believes we can draw on traditional African knowledge systems to better address issues of today, like sustainability. She told us about Ngoma, a broad range of these systems found in Southern Africa, and the role that ‘Diviners’ play in resolving problems.

You’re probably familiar with a part of these knowledge systems, ‘Unbuntu’, which translates a ‘I am because we are’. We contrast this with Descartes’ maxim ‘I think therefore I am’, but Ubuntu is really about acting, not thinking. We really have to abandon our habitual lens on the world when looking at these systems.

The rituals and behaviours of the Diviners seem mysterious to us, whilst the ‘laws’ of these systems are often ambiguous. There are unfamiliar ideas about reverence to ancestors and returning things to ‘place’. However, what actually happens is that a space is created for solutions to emerge. The ambiguity is an important part of that, as is recognising the dynamic between chaos and order.

Contrast that with the false certainty that we seek today, the polarisation of opinions, the rigidity of logic such as ‘the numbers don’t lie’ and ‘what can’t be measured can’t be managed’. What’s more ridiculous, people looking for answers through the ‘tossing of the bones’ (one of the rituals) or looking for answers in a spreadsheet? Which contains the greater wisdom?

Nicola pointed out that these knowledge systems have evolved and survived many pressures, of colonialism, war, technology and so on. However, the biggest threat lies in the co-opting of these ideas into western thinking, the absorption and assimilation and, likely, corrupting of them. So I’m not suggesting we adopt these knowledge systems but I do recommend studying them and reflecting on what knowledge system we are currently operating under, and how we might change that to get different outcomes.

And before we ridicule what others are up to, perhaps reflect on the absurdity of our own world view and the madness that we have normalised.

(Tyson Yunkaporta talking about our gym habit from the Aboriginal perspective is a hilarious example of this. To paraphrase his comments: we go to a room to lift weights for no reason, and to run nowhere, when we could just go into nature and do that for a purpose. And we reckon we’re the smart ones.)

Shopping

So, in the spirit of adopting a different set of beliefs, what if companies focused on making their employees happy instead of focusing on maximising profits by optimising efficiencies?

I don’t mean pretending to want to make them happy and trotting out the usual platitudes about ‘our people are our most important asset’ and running wellbeing programmes, but actually making their happiness the number one priority, overriding all others (including financial).

Obviously, this would be too wild for the likes of PWC and probably for many of their clients. After all, they are serious businesses! It’s OK for little businesses like Henry Stewart’s Happy Ltd, or ‘social enterprises’ like Cook, but that’s not what ‘real’ business is about.

How about Timpson’s then? The national retail chain of shoe repairers, photo shops and dry cleaners, who have holiday cottages that their employees can use, who give them days off for birthdays and significant life events and empower them to do whatever they think will serve the customer better?

Still not big enough? Well how about the John Lewis Partnership, founded over 100 years ago on that very premise, that the first priority is to make the employees happy?

All of these are an example of a different set of beliefs based on a different sort of wisdom. In the case of John Lewis, these have been expressed in a new book by the former MD of the Waitrose division, Mark Price, which he calls ‘The Happiness Economy’.

He explains the simple logic of this approach (and much more about his book) in this episode of the Eat Sleep Work Repeat podcast as follows:

‘… the guy who founded the company over 100 years ago had this really simple idea. If my people are happy, they’ll stay longer, so training will stick. They’ll take less sick absence. I’ll have lower turnover, staff turnover, so that will save me on costs, but I’ll get increased productivity.’

That’s a fundamentally different way of thinking about business to the orthodoxy of obsessing on the metrics and the numbers.

And it works. In his post-JLP career, Price has founded WorkL, a company that measures, tracks and improves workplace happiness to drive employees happiness and productivity, for businesses and for individuals. Their technology underpins The Sunday Times Best Places To Work report and similar reports in other countries, and is used by hundreds of companies and thousands of individuals. Consequently, they have a huge amount of data on employee happiness and its impact.

And here’s what Price has to say about that impact:

‘What I can tell you with absolute confidence is those organisations that have the highest level of employee happiness as we measure it, they have higher profits, they have higher productivity, they have lower stuff turnover, and they have low levels of sick absence. And that gives them a competitive advantage.’

Price has identified 6 factors that affect happiness and, consequently, will produce better business outcomes. They are:

• Reward and recognition

• Information sharing

• Empowerment

• Wellbeing

• A sense of pride

• & Job satisfaction

Not exactly earth-shattering. There is plenty of nuance in each one, though, and there's comprehensive data to underpin this. It’s not like we don’t have solutions for each of these either, although each organisation will have to craft the package of actions that are appropriate to them.

So, faced with ineluctable logic and unarguable data, will business adopt this approach? After all, they believe in logic and data don’t they?

Well, no.

They believe in the factory system. They believe in the busted flush of neo-classical economics. They believe in the orthodoxy that says you must focus on the profits and optimising efficiency, to the exclusion of everything else.

They don’t believe that making their employees happy will work.

They might say they do but their actions belie that. They may well believe it is desirable, a nice-to-have, but they don’t believe it is critical.

The problem isn’t the decisions these companies make, or the things that they do, it’s what they believe in.

I hope Price’s book has an impact. However, the orthodoxy is so deeply entrenched I’m not sure the people at the top are going to be persuaded, I think change will happen when they are replaced. So perhaps the message needs to be directed to the next generation, the ones about to take over.

I would prefer the argument to be couched in more moral terms, too. The purpose of business should be to make their employees happy, to add to the sum of human happiness. We should put people first because it’s the right thing to do, it’s the right way to treat fellow humans. That it happens to be the best way to achieve other goals, like financial ones, is a beneficial side-effect.

By couching it in the terms of the economic benefits, it re-enforces the orthodox view that the only valid lens to look at business is through the numbers. That’s exactly the view that needs to be challenged.

John Spedan Lewis, the founder of the John Lewis Partnership, seems to have started from a position of a sense of fairness, being affronted by the inequality of reward between the owners and the workers, and an unwavering belief in his ideas. (I’ve had to surmise this because I couldn’t find any account by him of his motivations.)The ‘economic logic’ was not immediately obvious and his methods took a while to yield returns. It was only because he had the resources of the business his father had built that he was able to see it through and show the wisdom of his thinking.

I conclude that he was a decent man who and was driven by his values. Shouldn’t all leaders start from there?

What Have I Done To Deserve This?

What do we deserve from work?

Some would say that employees expect too much these days. They want their work to give them meaning, to be aligned with their values, to support their politics. They want their managers to support their mental health, take an interest in their lives and to accommodate their individual needs. They want work to provide them with a social life and a friendship group.

It’s too much!

Bloody snowflakes!

The ones who say this are the people think that employees should just be grateful for having a job and getting their pay check and should do what they are told.

But who would want work that is meaningless, conflicts with their values and tramples over the issues they feel strongly about? Who wants a manager who damages their mental health, doesn’t care about them as a person and takes no account of their personal needs? Who wants to work somewhere where connection and belonging are absent and they don’t relate to anyone?

That sort of environment is bad for both employees and their employer. And yet there’s a plenty of people who are in ‘toxic’ environments where that is pretty much what’s on offer.

Milton Friedman wrote that the social responsibility of business is to increase its profits. This has become known as ‘shareholder primacy’ and has led to the promotion of shareholder interests, specifically shareholder returns, to the exclusion of all other interests. Implicit in this is that employees deserve nothing more than their wage. In actuality, this position has increasingly become explicit over the decades since Friedman’s doctrine was embraced by the corporate world.

Friedman was wrong.

Employees deserve much more. They deserve to be treated as human beings, they deserve dignity and respect, they deserve a fair reward for their work, they deserve honesty and justice, they deserve the opportunity to live a good life.

They deserve to be happy.

I propose a new doctrine. The social responsibility of business to make employees happy, and so contribute to society and humankind.

Co-incidentally, it will make business more profitable. But it will make us all much richer.

John Spedan Lewis saw this over a hundred years ago. Mark Price and his company, WorkL, have the data to prove it.

It’s about time we made it happen, isn't it?