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Stupidity Management & the Single Entrepreneur*

The headline stopped me cold:

Two academics, Mats Alvesson of Lund University in Lund, Sweden, and Andre’ Spicer of City University London, published the results of their in-depth research into “Functional Stupidity” offering a theory of. . . 

"Ah, ha, the truth is finally out,” I chortle with smug glee.  All those dolts and troglodyte managers I suffered under those 46 miserable years of wage slavery,  finally, their hockey-puckedness is exposed for the world to see."
Then I read the paper published in the November 2012 issue of the Journal of Management Studies.  Oh.  Well, now.  On second thought I have to accept the authors’ conclusion that Functional Stupidity may be a bad thing but may also be a good thing, an important concept that leads to predictable functioning and efficiency.  So what is Functional Stupidity?

It’s quite straight forward, really.  As Alvesson and Spicer point out, the dominant myth in today’s business world is of companies that are “smart, knowledge-based”  organizations in which managers hire smart people and let them talk to one another.   The authors conclude with supporting evidence that this is a myth, a “grandiose assumption” not supported by the data.  To them, the reality is quite the opposite in which the guiding methods and management principles are best described as Functional Stupidity. 

The Concept of Functional Stupidity
Functional stupidity is the tendency of the owners, managers, and employees of an organization to:

1.      Not think about their practices and procedures, rather they just go about their daily tasks without considering if there might be a better way.  (Absence of reflexivity.)

2.      Not ask “why are we doing things this way?” (Avoidance of justification.)

3.      To not seek out or to simply ignore different, perhaps better ways of doing things. (A myopic use of intellectual capacities.)

4.      To not challenge anyone in authority who justifies  current practice by saying, “we’ve always done it this way,” or “we do it this way because I say so,” or “we haven’t time to look into that,” or any of a dozen other deflections.  (Avoidance of justification.)

Functional stupidity in an organization is fostered by the manager’s and employee’s unwillingness to rock the boat so as to be seen as a “professional” and a “company man or woman,” deserving of promotions and raises and increased respect.  It’s the old business saw, “to get ahead, get along.” 
For these and other reasons, many managers and employees and even owners simply avoid and prevent employees from looking at an issue and how it effects the business.  Functional Stupidity gives many members of the organization a false sense of security – even with issues that could become a disaster and are obvious to outside observers and some within.  While “get along to get ahead” thinking does create a false sense of security, it also, as the authors point out, can create an underlying rumble of dissatisfaction and loss of motivation in parts of the organization.
Functional Stupidity is fostered and supported by all those business activities that are so popular today – the creation of a “corporate culture” through the application of a veneer of mission, vision, and values statements plus the application of branding, public relations, advertising that creates an image not necessarily based on substance.  It’s even fostered by owners and managers who feel they must be dynamic leaders, which contributes directly to shutting down any questioning or communication about the organization in deference to the higher morality wisdom of this leader.  It all leads to Functional Stupidity running rampant in an organization.

We’ve all been here, haven’t we?  Working for a company or agency, knowing that there are problems, perhaps critical problems, just waiting to erupt, but feeling frustrated and helpless to do anything about it.  Perhaps management won’t hear, perhaps they actively suppress any recognition of what others clearly see.  The options are to stuff your feelings, to look for a new job, or to make a ruckus that leads to being passed over for promotions, being actively disciplined, being handed a pink slip and shown the door or quitting in disgust to start your own business.

This the down side

The Upside of Functional Stupidity
Turn this rigid, reactionary, unyielding image around.  Imagine working for a company where every time you were assigned a task you had to make a decision on the best way to perform that task based on the best available research.  Every time.  Nothing would get done because every task is considered unique with a unique solution.  Putting a stamp on an envelope: is it better to lick the stamp, to use a moist sponge, or to purchase pre-gummed stamps?  Yes, last week it was licking the stamp, but we should check to see if there’s some new information that challenges that decision. 

It becomes management by Organized Chaos (my term), which you may have also experienced in the workplace.
The absurdity of thinking through each repetitive task anew is obvious.

If functional stupidity is defined in part as accepting things the way they are and doing things the way we always have, you can see its advantages as a management technique.  Every organization has formal and informal procedures that allow employees to function with having to research and make decisions about what they are doing thereby allowing the organization to function efficiently. 

The Down Side of Functional Stupidity
Functional Stupidity is in the author’s view a substantial problem.  And obviously when no one stops to look at what the organization is doing, on any level, ever, whether due to management inertia and indifference or malice aforethought, that is a problem.

It’s important there be a balance between “Functional Stupidity” and it’s opposite, “Functional Smarts” (again, my term).  Too much stupidity, and the organization grinds to a halt.  Too much smarts, and all is chaos and constant change.  You need Stupidity in an organization to achieve functional balance with Smarts. 

Functional Stupidity and the Single Entrepreneur
You can see where this is going.  As someone who is considering starting a business or has started and is running a business there are obvious implications for you.  On one hand, you want your new venture to have discipline and predictability.  The last thing you want is the chaos of every employee each doing a task differently based on that employee’s research and decision-making process.  To this end, you, the entrepreneur, research and design how your business functions and require your employees to adhere to your practices.

On the other hand, you and your business have to keep up with changes in customer tastes and needs, new technology in your industry, and your changing and growing understanding of what you want your business to be.  Like a shark, stop moving forward and your company will die.  You just don’t want every day to be a feeding frenzy.

*  *  *  *  *
The Rule of 95

An ex-employer, Bob Hacker of Seattle’s Hacker Group, had a rule for his employees he called the Rule of 95, something I believe he picked up at the Harvard Business School.  In short, according to Bob, in any organization 95% of all activity should be as close to automatic as possible, whether mailing a letter or writing a proposal or manufacturing a product or providing a service.  Only 5% of the activity of that organization should be placed in front of the owner (Bob) or top managers for research and a decision on how to proceed.  Without the Rule of 95, an organization cannot function.  (This is where people who micro-manage cripple their organization and de-motivate their employees, but that’s another story.)

The Rule of 95 conforms with the concept of “Functional Stupidity,” and offers a way to balance Stupidity and Smarts in an organization. (My conclusion.)

*  *  *  *  *

Alvesson and Spicer don’t offer any solutions other than the observation that you have to find a balance.  Which for a small business owner can be pretty tough, what with working long hours handling all functions of your business.  Who has time to think about this sort of thing?  It would easy to say, you have to think about this sort of thing. 

Great.  One more ball to keep in the air.  It’s just you.

*  *  *  *  *

The “It Is Good To Be King” Fallacy
Any self-employed person or small business owner at one time or the other has said:  “Finally.  I’m going to do things my way.  I’m the boss.  I’m in control.  I’m King.  And it is good to be King.”  With apologies to Mel Brooks (left) in his farce, The History of The World, Part II.

If you’ve ever said:

1.      “How could I have been so stupid?”

2.      “You’ll do it that way because I say so!”

3.      “Look, it’s not a bad idea, we just don’t have time right now.”

4.      “Write me a memo.  I’ll think about it later.”

Then you, too, are using the techniques of Functional Stupidity to get out of looking at your business methods and processes.  You just may be practicing “Functional Stupidity.”

*  *  *  *  *

The Function of Your Business Plan: Balancing Stupidity and Smarts
 The need for both you and your business to adapt and grow is why so much emphasis is placed on your business plan as a living, breathing, working document. 

Periodically working on your business plan, even sharing part or all of it with your employees and other “stakeholders” is when you apply Functional Smarts to your business.  It’s the right time and vehicle for asking “why are we doing what we’re doing, are there better ways, should we change”, and so on, and getting feedback and ideas from your employees. 

Every industry and every business has busy times of the year and slow seasons.  Pick a day or a weekend during the slow season to go through the functions of your business, to examine them and to make change as needed.  Involving your employees gives them ownership in your business and helps them both understand why you do things the way you do and to commit to these practices.

*  *  *  *  *
The Entrepreneur's Bookshelf ~
The more you know about small business management and financing before you start, the more likely you are to succeed.  That's why I urge anyone thinking of starting a business to contact their local Small Business Development Center or Community College.  I have also organized this bookshelf for you at Powell's Books, the world's largest single site new and used bookstore, featuring the latest books on small business start-ups, marketing, and small business money management.   
A Selection Related to this Post:

Click on this link to see all the selections on ~

* * * * *

SOURCE:  Mats Alvesson, André Spicer. A Stupidity-Based Theory of Organizations. Journal of Management Studies, 2012; 49 (7):  For a copy of the full report:  A Stupidity-Based Theory of Organizations

* A pun on the title of the 1962 non-fiction book by Helen Gurley Brown, Sex and the Single Girl.



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