"A Teacher Of Evil"

Empiricism And Management

Delusions are inexhaustible; I vow to end them - Second Bodhisattva Vow

I was recently talking to Richard Claydon and he brought up the following quote:

“It must be remembered that there is nothing more difficult to plan, more doubtful of success, nor more dangerous to manage than a new system. For the initiator has the enmity of all who would profit by the preservation of the old institution and merely lukewarm defenders in those who gain by the new ones.”

The quote is sharply observed and unsparing in its commitment to reality above idealism - exactly what you would expect from Niccolò Machiavelli. Nowadays Machiavelli is associated with the cynical conniving of Succession, Game of Thrones, House Of Card, and Songs of Praise. But this view underappreciates him. He was, above all, a pragmatist and a realist. He wrote about both princes and republics (in the less well-known Discourses) and he wanted them to successful, not to fail by adhering to some feel-good lie. Like others from the Italian city states of the 16th century, he was an empiricist - some have called him the “Galileo of politics”. Facts don’t care about your feelings.

Perhaps the closest analogue to Mach is Jeffrey Pfeffer. Much as Machiavelli was based in the economic and intellectual centre of his world, so Pfeffer is based at Stanford University. His students go on to work in companies who are the rulers of the modern world. His books Power and Leadership BS are the spiritual heirs to The Prince. They are unsentimental analyses of the human dynamics of organizations. They chuckle ruefully at the childish nostrums and wish-fulfilment of the leadership literature. While Dying For A Paycheck reminds us that Pfeffer (as Machiavelli was) is fundamentally a humanist. Lies cost lives.

The book most relevant for this post was one that he wrote in 2006 with fellow Stanford Faculty member Bob “ No Assholes” Sutton Hard Facts, Dangerous Half-Truths, and Total Nonsense: Profiting from Evidence-Based Management. As the title might subtly intimate, this is a book concerned with cutting through the management fads and fashions to the empirical core that might be locatable somewhere. Their model was that of evidence-based medicine (EBM) - which advocated that medical practice should be based on real-world research through randomized controlled trials (RCTs) - not what the doctor had remembered from med school 30 years previous nor what the last drug rep who took them out to lunch had told them.

If you want to take a medical drug to market then there is a rigorous testing process that you need to go through. This is not perfect, drug manufacturers will often cherry pick the studies that they choose to release although this can sometimes be identified using funnel plots. Manufacturers often only have to show absolute efficacy rather than efficacy relative to patent-free (and therefore much cheaper) drugs that are already on the market. Imagine if there was an FDA for LinkedIn posts.

There is a Center for Evidence-Based Management that operates out of the Netherlands which has a mix of academics and practitioners. An issue is that most academics are sublimely disinterested in practice (as it does not lead to published papers in top tier journals) and most practitioners are not interested in research (esp. the reading and the overall buzzkill nature of critical thinking and the admitting that you might be wrong). So you often find empiricists living on the academic-practitioner faultline. And they are not always the most popular people in the world. Empiricism doesn’t always make you feel good or earn you easy friends - Machiavelli could have told you that.

I do not see the business world becoming empiricist over night. We like our comforts too much for that. But lets take a moment to celebrate empiricists in the worlds of management:

• The aforementioned Claydon, Pfeffer & Sutton.

• Henry Mintzberg, Roger Martin & Richard Rummelt in Strategy

• Paul Gibbons & Patricia Kennedy in Change Management

• Rob Briner in HR

• Mark Ritson, Byron Sharp & Jenni Romaniuk in Marketing

• Howard Dover & Leff Bonney in Sales

• Aswath Damodaran in Corporate Finance

• Honorable mentions to Kailash Awati, Paul Culmsee, Gary Klein & Philip Tetlock

This is not an exhaustive list - there are many others. Feel free to add your favorites in the comments.