Albert Dunlap Style Likability: Those Who Seek Flattery Get Enemies

[The following post is re-blogged from Organizational Musings. Click here to view the original article. It is a commentary based on a recently published article in Administrative Science Quarterly entitled “Those Closest Wield the Sharpest Knife: How Ingratiation Leads to Resentment and Social Undermining of the CEO,” co-authored by Gareth D. Keeves, James D. Westphal, and Michael L. McDonald. From Organizational Musings:] 

I will start this post with an old story. CEO of Sunbeam Corp., Albert Dunlap, known as an expert in turning around troubled firms and selling them for a profit, was sued by the SEC in 2001 for accounting fraud. He was eventually barred from serving as an officer or director in any company, plus ordered to pay investors defrauded money in a class-action lawsuit.  Albert Dunlap was clearly someone in need of flattery, not just money, as he had the classical flattery-sickness symptom of a book written to celebrate his successes (see also his picture!). How he managed things internally in each firm he led is disputed, but much was said about his intimidation of other managers, who probably would conclude that a lot of flattery and ingratiation might help their career. Of course, managers still did better than employees, because his signature move in turning firms around was mass layoffs.

An interesting detail of his downfall was that managers around him were quick to release information that helped the investigation, which is distinct from the many firms with management teams that do all they can to deter and obstruct investigators. Is there a systematic reason for this difference? Possibly. A recent article in Administrative Science Quarterly by Gareth Keeves, James Westphal, and Michael McDonald looks at what happens when managers ingratiate their CEO through flattery and other tools. Their findings are interesting. First, managers who flatter lose their liking of the CEO. Somehow when people artificially put others on a pedestal they also start looking down on them.

Second, managers who flatter may go on to undermine the CEO. The light-handed version of this is to undermine the CEO’s messages to journalists, as this research showed. The heavy-handed version is what happened to Albert Dunlap. Among other events, his comptroller reported that he had been pushing for accounting practices that crossed the legal boundary, and sales people were quick to report “channel stuffing.” Channel stuffing is to sell too many goods and selling them too early, which is not illegal in itself (the sales channel can return unsold goods, so it is safe for them), but it is illegal when the sales are accounted as if they were final.  Those were practices that the SEC (and some investors) suspected, and that meant that what looked like a turnaround in sales and profits was actually a fraudulent scheme.

Seeking flattery is never thought of as a good thing. What we now know is that it also triggers undermining, and for those who have real weaknesses – like a CEO engaged in fraud – that undermining can be very consequential.

Organization OR Environment?

organization-enviroment[We’re pleased to welcome Jennifer Tosti-Kharas, Assistant Professor at Babson College in Organizational Behavior. Tosti-Kharas recently published an article in Organization & Environment entitled “Organization OR Environment? Disentangling Employees Rationales Behind Organizational Citizenship Behavior for the Environment.” From Tosti-Kharas:]

The origin of this paper came from bridging two different research projects. My co-authors, Tom Thomas and Eric Lamm of SFSU, published a theoretical paper regarding how individuals develop attitudes toward organizational sustainability. Meanwhile, Eric and I have performed research on what motivates employees to perform sustainable behaviors. We look at what we term organizational citizenship behaviors toward the environment ¬ OCB-Es for short ¬ which are voluntary actions at work that help conserve resources, things like recycling, printing double-sided, etc. This paper joined these two streams of inquiry to examine how the reasons why people think it is important to act sustainably at work relates to their performance of OCB-Es and we tested it empirically.

Most past research on this topic has used a measure of how important people think sustainability is in general, meaning for broad ecological reasons, but never contextualized within a work organization. In the paper we distinguish between believing sustainability is important in and of itself, what we term an ³eco-centric rationale,² and believing it is important as a means to an end, specifically a business end, which we term an ³organization-centric rationale.² We also differentiate employees¹ own rationales about why it is important for their companies to operate sustainably from their perceptions about why their organizations believe it is important. Perhaps the most surprising finding when we surveyed 489 working adults across a wide range of organizations and occupations was that people were more likely to perform OCB-Es when they believed their organizations valued sustainability, regardless of their own personal beliefs about the importance of sustainability. These findings held for both eco-centric and organization-centric rationales. This to us was surprising, as lots of research would lead us to predict that personal values would trump perceived organizational values. Yet, we find the opposite, which suggests that perhaps people perform voluntary sustainability behaviors at work not just because they think it¹s important, but because their company believes it is important. It is worth noting that we included in our OCB-E measure not only simple, everyday tasks, but also ³higher-level² behaviors, like collaborating with other employees or making suggestions to supervisors to increase organizational sustainability.

These findings raise several interesting and timely implications for organizational leaders looking to increase employee sustainability behaviors. Since employee perceptions of organizational rationales for sustainability were so important in motivating OCB-Es, we advise communicating corporate values around sustainability and resource conservation as clearly as possible. By contrast, trying to screen employees for pro-environmental values seemed to be less important in a company that clearly communicated these values, since even employees who didn’t buy in on their own behaved more sustainably when they believed their employers cared about the environment.

 

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Studying Organization Theory “As If Matter Mattered”

[We’re pleased to welcome Bruno Dyck of University of Manitoba. Bruno recently published an article with co-author Nathan S. Greidanus in Journal of Management Inquiry entitled “Quantum Sustainable Organizing Theory: A Study of Organization Theory as if Matter Mattered.” From Bruno:]

From environmental concerns like climate change to social issues like economic inequality, sustainable development presents this century’s greatest challenges and opportunities for businesses.  Yet, businesses remain trapped by old paradigms and approaches to the business-society-environment interface. To break free of these chains, we start with a simple question: what would a theory of business look like if matter mattered?  In answering this question, we turned to the field that is focused on the fundamental building blocks of all matter, quantum physics.

Do you remember the first time you heard about the unbelievable findings coming Current Issue Coverfrom quantum mechanics? Maybe it was research on entanglement, which shows that two quantum particles (e.g., two electrons) are interconnected in such a way that a change in one will have an instantaneous change in another, even if it is light years away. Or do you remember hearing about the results from the double slit experiments—perhaps the most famous experiment in all of physics—which shows that observing a photon changes it from acting like a wave into acting like a particle (If you want to watch a simple video about this, check out https://www.youtube.com/watch?v=DfPeprQ7oGc). Perhaps the most amazing variation of the double slit experiment shows that information is being sent backward in time. It has taken a century, but quantum physics has today become a dominant paradigm in the world of physics, even if we in the social sciences remain “stuck” in a Newtonian space-time box.

As co-authors we were fascinated by quantum research, and were curious about its implications for organization theory, and especially for sustainability. We believe that the ideas of entanglement and indeterminism provide a welcome and necessary framework to develop organizing theory that addresses key socio-ecological issues facing humankind, and which break free from the constraints associated with (Newtonian) notions of separateness, determinism and externalities. Moreover, a quantum perspective, which suggests that matter matters, provides a welcome counterpoint to the problematic fixation on socio-material well-being (e.g., money) that characterizes conventional theorizing.

We were pleasantly surprised by how readily the fundamental principles associated with the quantum world can serve as the basis to develop sustainable organization theory, As the sustainability issues facing humankind grow in urgency, we expect such non-Newtonian thinking to become as dominant in our field as it is in physics, but if this takes a century to happen then it may be too late.

The abstract for the paper:

We draw on quantum physics ideas of “entanglement” and “indeterminism” to introduce and develop “Quantum Sustainable Organizing Theory” (QSOT). Quantum entanglement points to the interconnectedness of matter in ways that defy Newtonian physics and commonsense assumptions that underlay conventional organizing theory. Quantum indeterminism suggests that uncertainty is an inherent feature of reality and not simply a lack of information that impedes rational decision making. Taken together, these quantum ideas challenge the assumptions of conventional organizational theorizing about the boundaries between a firm and its natural and social environment, the importance of self-interested individualism and (sociomaterial) financial measures of performance, the emphasis on competitiveness, and the hallmarks of rational theory and practice. We discuss implications for sustainable organizing in particular and for organization theory more generally.

You can read “Quantum Sustainable Organizing Theory: A Study of Organization Theory as if Matter Mattered” from Journal of Management Inquiry free for the next two weeks by clicking here. Want to stay current on all of the latest research from Journal of Management InquiryClick here to sign up for e-alerts!

Employees and the Environment: Promoting Eco-Friendly Behavior in the Workplace

blue-truck-recycle[We’re pleased to welcome Jennifer Tosti-Kharas of Babson College. Jennifer recently published an article in Organization & Environment with co-authors Eric Lamm and Tom E. Thomas entitled “Organization OR Environment? Disentangling Employees’ Rationales Behind Organizational Citizenship Behavior Toward the Environment.” From Jennifer:]

The origin of this paper came from bridging two different research projects. My co-authors, Tom Thomas and Eric Lamm of SFSU, published a theoretical paper regarding how individuals develop attitudes toward organizational sustainability. Meanwhile, Eric and I have performed research on what motivates employees to perform sustainable behaviors. We look at what we term organizational citizenship behaviors toward the environment ­ OCB-Es for short ­ which are voluntary actions at work that help conserve resources, things like recycling, printing double-sided, etc. This paper joined these two streams of inquiry to examine how the reasons why people think it is important to act sustainably at work relates to their performance of OCB-Es and we tested it empirically.

Most past research on this topic has used a measure of how important people think O&E_Mar_2012_vol26_no1_Cover_Final.inddsustainability is in general, meaning for broad ecological reasons, but never contextualized within a work organization. In the paper we distinguish between believing sustainability is important in and of itself, what we term an ³eco-centric rationale,² and believing it is important as a means to an end, specifically a business end, which we term an ³organization-centric rationale.² We also differentiate employees¹ own rationales about why it is important for their companies to operate sustainably from their perceptions about why their organizations believe it is important. Perhaps the most surprising finding when we surveyed 489 working adults across a wide range of organizations and occupations was that people were more likely to perform OCB-Es when they believed their organizations valued sustainability, regardless of their own personal beliefs about the importance of sustainability. These findings held for both eco-centric and organization-centric rationales. This to us was surprising, as lots of research would lead us to predict that personal values would trump perceived organizational values. Yet, we find the opposite, which suggests that perhaps people perform voluntary sustainability behaviors at work not just because they think it¹s important, but because their company believes it is important. It is worth noting that we included in our OCB-E measure not only simple, everyday tasks, but also ³higher-level² behaviors, like collaborating with other employees or making suggestions to supervisors to increase organizational sustainability.

These findings raise several interesting and timely implications for organizational leaders looking to increase employee sustainability behaviors. Since employee perceptions of organizational rationales for sustainability were so important in motivating OCB-Es, we advise communicating corporate values around sustainability and resource conservation as clearly as possible. By contrast, trying to screen employees for pro-environmental values seemed to be less important in a company that clearly communicated these values, since even employees who didn¹t buy in on their own behaved more sustainably when they believed their employers cared about the environment.

The abstract for the article:

Scholars and managers have raised the question of how to encourage employees to perform discretionary pro-environmental behaviors at work, termed organizational citizenship behaviors toward the environment (OCB-Es). This study examined how rationales for organizational sustainability relate to employees’ OCB-Es. We considered two rationales—eco-centric and organization-centric—and two sources—employees’ rationales and their perceptions of their employers’ rationales. Results from 489 working adults across a variety of organizations and occupations revealed that both eco-centric and organization-centric rationales at both individual and perceived organizational levels related to employees’ OCB-Es. Furthermore, we found interactive effects, such that employees’ perceptions of their organizations’ rationales were more important than their own rationales in determining OCB-Es. These findings contribute to a theoretical understanding of the complex and interrelated factors motivating employees to perform voluntary sustainability behaviors in organizations. In addition, our results are valuable for managers looking to increase employee sustainability behaviors.

You can read the article “Organization OR Environment? Disentangling Employees’ Rationales Behind Organizational Citizenship Behavior Toward the Environment” from Organization & Environment free for the next two weeks by clicking here.

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*Truck image attributed to MIKI Yoshihito (CC)

Call for Papers: World Future Review!

Current Issue CoverWorld Future Review is currently accepting submissions concerned with futures research. The journal publishes foresight literature addressing topics informed by technology assessment, policy analysis, operations research, issues management, competition research, and more. To find out more about the manuscript submission guidelines and how you can submit your manuscript to World Future Review, click here.

In the recent June 2016 issue, World Future Review featured articles that addressed social movements and futures research, the operational process for organizational foresight, and the health of futures studies. In addition, a new article published online by authors David N. Bengston, Jim Dator, Michael J. Dockry, and Aubrey Yee entitled “Alternative Futures for Forest-Based Nanomaterials: An Application of the Manoa School’s Alternative Futures Method” delves into four alternative futures for forestry. The abstract for the article:

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Forestry and forest products research has entered into a robust research agenda focused on creating nano-sized particles and nanoproducts from wood. As wood-based materials can be sustainably produced, the potential of these renewable products could be limitless and include high-end compostable electronics, paint-on solar panels, and lightweight materials for airplanes and cars. Others warn about potential serious negative health and environmental consequences. Either way, wood-based nanomaterials could disrupt forestry as we know it. This article is a summary and analysis of a collaborative research project exploring the futures of wood-based nanomaterials within the context of the futures of forests and forest management within the United States. We start by describing the history of forestry through the lens of the U.S. Forest Service, then describe nanotechnology in general and wood-based nanocellulose specifically. Next, we outline the Manoa School alternative futures method, and how we used it to design and carry out a “complete futures of x” project. Following the Manoa School approach, we describe four alternative futures for forestry and forest management. We conclude with implications for the future of forestry, forests, and forest-based nanomaterials, as well as a discussion on the implementation of a complete “futures of x” project.

You can read both the June 2016 issue and the article “Alternative Futures for Forest-Based Nanomaterials: An Application of the Manoa School’s Alternative Futures Method” from World Future Review free for the next two weeks. Want to stay up to date on all of the latest research from World Future ReviewClick here to sign up for e-alerts!

*Wood image attributed to Dennis Hill (CC)

A Broader Look at Firms’ Corporate Social Performance in 2000-2010

 

10310820984_fb57a27068_z[We’re pleased to welcome Elise Perrault of College of Charleston. Elise recently published an article in Business & Society, entitled “What have firms been doing? Exploring what KLD data report about firms’ corporate social performance (CSP) in the period 2000-2010,” with co-author Michael Quinn of Bentley University.]

With a strong interest for firms’ relationship with stakeholders and, more broadly, society, we constantly read about how firms address – or not – a wide variety of social issues. However, this stream of research generally provides anecdotal evidence or analyzes antecedents and consequences of firms’ involvement in a targeted issue (such as philanthrophy or environmental management, for example). In short, we felt the need for a broad, 30,000 ft, view of how firms generally engage with stakeholders through addressing social issues. At the same time, with the soaring popularity of KLD data in the field, we wanted to gain a more precise appreciation of how this data source pictured firms’ actions in society.

We find our results quite revealing and at times surprising. For instance, the results show that firms are increasingly attending to secondary stakeholders, even while garnering more concerns on primary stakeholder dimensions. This points us to question whether managers are experiencing shifting beliefs regarding the value of BAS CoverCSR; specifically that it represents less a mechanism to attract stakeholder support and more a cornerstone to their risk management approach in terms of how society values the firm’s existence. We also find, as expected, that firms generally nurture strengths in the same dimensions in which they present concerns.

The most surprising finding is the extent to which prior corporate social performance (CSP) in a given dimension is linked to CSP in other dimensions over time. This suggests that as firms engage in CSP, they find rewards that drives them to further invest in yet other dimensions of CSP. As a result, we are led to reconsider the notion of a “virtuous circle” (Waddock & Graves, 1997) and suggest that future research examines in greater depth the real benefits that firms perceive from CSP and the motives that drive their increasing commitment to CSP.

Having provided this broader view of firms’ involvement with stakeholders and social issues, we hope this research will serve as a foundation for future research in several ways. For starters, we note the significance of industry dummies in the analysis. This finding confirms what previous research indicates, that industry matters to CSP strenghts and concerns. However, the extent to which industry affiliation predisposes a population of firms to certain CSP strenghts or concerns remains unaddressed. Pushing further in this direction would be to explore how industry affiliation affects stakeholders’ perceptions, and whether stakeholders are more forgiving or scrutinizing of firms in certain industries, for example.

Another insight from our analyses is the importance of using a long time frame when analyzing firms’ CSP, which has seldom been used in previous research. Doing so would enable researchers to see patterns and connections between various dimensions of CSP, answering questions such as “Do strengths (concerns) on certain dimensions of CSP generally prompt firms to subsequently perform better or worse on these and other dimensions?” While this would shed light on the ways in which firms can be primed to address certin social issues, on a broader scale, these analyses contribute to the conversation debating the fundamental question regarding the purpose of the firm and its obligations to shareholders and stakeholders.

The abstract for the paper:

With the blossoming of research on corporate social performance (CSP), the data produced by Kinder, Lydenberg, Domini (KLD) have become the standard to measure firms’ social and stakeholder actions. However, to date, only a few studies have focused on examining the data directly, and have done so largely in terms of validating the concepts and methods in the data set’s construction. The present study seeks to complement these efforts by contributing knowledge about what the KLD data report on firms’ actions toward primary and secondary stakeholders, and the dimensions of CSP that firms generally engage in, together or sequentially. With data on 3,073 firms over the period 2000-2010, results show that firms expend more resources on garnering strengths in primary stakeholder dimensions, although this trend is sharply deteriorating to the benefit of secondary stakeholders—notably the natural environment. Results also show that firms generally approach CSP with a mixed behavior, with strengths and concerns in the same dimensions, especially as it pertains to secondary stakeholders. These are the same dimensions in which firms show the longer, more intrinsic commitments, suggesting that secondary stakeholder strengths and concerns may be structural in nature. However, there is also evidence of relationships across dimensions, indicating that firms’ involvement in CSP can generate momentum. The rich implications of these findings are discussed.

You can read “What have firms been doing? Exploring what KLD data report about firms’ corporate social performance (CSP) in the period 2000-2010” from Business & Society free for the next two weeks by clicking here. Want to stay current on the latest research published by Business & SocietyClick here to sign up for e-alerts!

Interested in submitting a manuscript to the journal? You can learn more about Business & Society‘s manuscript guidelines by clicking here.

*Conference sponsorship image attributed to Fortune Live Media (CC)

Does Social Activism Disrupt Corporate Political Activity?

The use and efficacy of corporate political activity has been well researched in the past, but a new paper published in Administrative Science Quarterly from authors Mary-Hunter McDonnell and Timothy Werner is taking a new perspective of corporate political activity. The paper, entitled “Blacklisted Businesses: Social Activists’ Challenges and the Disruption of Corporate Political Activity,” focuses on how large scale activist protests disrupt corporations’ ability to influence political stakeholders. Mary-Hunter McDonnell dives into the findings of the paper in the video below:

The abstract for the paper:

This paper explores whether and how social activists’ challenges affect politicians’ willingness to associate with targeted firms. We study the effect of public protest on corporate political activity using a unique database that allows us to analyze empirically the Current Issue Coverimpact of social movement boycotts on three proxies for associations with political stakeholders: the proportion of campaign contributions that are rejected, the number of times a firm is invited to give testimony in congressional hearings, and the number of government procurement contracts awarded to a firm. We show that boycotts lead to significant increases in the proportion of refunded contributions, as well as decreases in invited congressional appearances and awarded government contracts. These results highlight the importance of considering how a firm’s sociopolitical environment shapes the receptivity of critical non-market stakeholders. We supplement this analysis by drawing from social movement theory to extrapolate and test three key mechanisms that moderate the extent to which activists’ challenges effectively disrupt corporate political activity: the media attention a boycott attracts, the political salience of the contested issue, and the status of the targeted firm.

You can read “Blacklisted Businesses: Social Activists’ Challenges and the Disruption of Corporate Political Activity” from Administrative Science Quarterly free for the next two weeks by clicking here. Want to keep current on all of the latest research from Administrative Science QuarterlyClick here to sign up for e-alerts!