The business and management organizational literature is a sprawling literature, so much work is being done; and also, of course, business is a highly competitive process, so between-group competition in the business world is intense. Businesses don’t always work well, and there’s something very new about both of these perspectives: the evolutionary perspective and the Contextual Behavioral Science perspective. In this conversation with Frank W. Bond, J.W. Stoelhorst, and Mark van Vugt, they offer their perspectives about how these frameworks can be utilized against the background of both the sprawling academic study of organizations and the organizations themselves.
We began the conversation by focusing on the monitoring that takes place for groups working well because that’s one of the core design principles according to Elinor Ostrom. If you can’t monitor agreed-upon behavior, then those behaviors are unlikely to thrive. But there are also bad forms of monitoring as well as overmonitoring.
We ended with two big questions. The first question has to do with Homo economicus, or the idea that humans have evolved to be rational and will attempt to maximize their utility for both monetary and non-monetary gains. Often a company is organized for the benefit of the elites within that company. It may be working great for the CEO, or the CEO and the shareholders, to focus on extracting value from the company. However, while it may be good for them, it is not necessarily good for the company. And, of course, they’re not going to want to give up control. Homo economicus is an ideology that serves those purposes, and these folks are not going to go lightly into the night. There is a kind of multilevel view of business evolution, which notes this disruptive within-group component. There is something almost revolutionary—I mean, literally so— about members of organizations that do not have much power wresting back that power. What may make that work is if organizations that do that in fact out-compete the companies that are handicapped by disruptive within-group processes.
The second question was how we do scientific research with groups like this. Often, companies and nonprofit organizations really don’t have a scientific mindset, and the idea that they can be treated like living laboratories is not as simple as it might seem.
Elinor Ostrom won the Nobel Prize by creating a database of common-pool resource groups from a very diffuse literature. Almost all of the accounts were descriptive, and nevertheless, that did not prevent her from coding them, analyzing them, and then coming up with these core design principles, which could then be validated with other kinds of studies. There’s a whole lot that can be done with data to mine, which can then be supplemented by more careful controlled studies.