Unit 1 Module 1 - Virtues and Drawbacks of Organized Activity.docx

Unit 1: Module 1 - Virtues and Drawbacks of Organized
Activity
Virtues and Drawbacks of Organized Activity
The establishment of large, complex organizations is
historically recent. Today, much of society's important work is
done in or by organizations. Many organizations really play
their roles well, providing good jobs, producing safe and
reliable products, developing their workforce, and fulfilling
their social responsibility. However, without the right
leadership and good decision-making, they may produce poor
service, and defective and dangerous products.
We have recently seen corporations tarnishing their reputations
by exploiting people and communities, and by damaging the
environment. In some cases, people chosen to lead organizations
seem to be clueless of what is really going on and how to keep
an organization in good shape, or how to turn it into a
successful one.
One way to avoid the negative effects of organized activity and,
therefore, improve performance, is through reframing or
viewing situations from multiple perspectives. Reframing offers
cognitive lenses on the world that affects what you see and what
it means.
This course introduces a framework consisting of the following
four basic lenses or frames for strengthening managerial
diagnosis and action:
· Structural Frame: It focuses on the architecture of
organization—the design of units and subunits, rules and roles,
goals and policies—that shape, and channel decisions and
activities.
· Human Resource Frame: It emphasizes that management

requires an understanding of people with their strengths and
foibles, reasons and emotions, and desires and fears.
· Political Frame: It depicts that organizations are considered
competitive arenas characterized by scarce resources, competing
interests, and struggles for power and advantage.
· Symbolic Frame: It focuses on issues of meaning and faith.
Key Words for the Four Frames
Frame
Key Words
Structural Frame
Goals, task, technology, rationality, environment, rules, roles,
linkages, differentiation, integration
Human Resource Frame
Needs, skills, feelings, motivation, satisfaction, norms,
interpersonal interactions, fit (between person and organization)
Political Frame
Power, conflict, coalitions, scarcity, enduring differences,
politics, bargaining, negotiation
Symbolic Frame
Symbols, meaning, belief, faith, culture, ceremonies, rituals,
myths, stories, play
Unit 1: Module 1 - Managerial Thinking
Managerial Thinking
Before becoming managers and leaders, professionals develop
their qualifications by learning from others and developing their
own managerial style and interpersonal skills. This formation
can be biased by those who play an important role on each
individual’s development process.
When each one of those individuals takes charge, they carry all
that into their performance and leadership style. Some are
overwhelmed by the new responsibilities and “freeze” before
the many challenges they face. It is also usual that managers

and leaders try to replicate solutions that worked for old
problems, and use them to overcome new ones, but the rate of
success is not likely to be the same.
In short, managerial thinking is highly influenced by formation
and prior experiences of what can be good or not. When facing
low productivity or complex problems, it is important for the
manager to look at them using different “lenses” through
reframing.
As stated by many authors, a manager’s perception that his or
her approach is the only way to handle a particular problem can
hinder managerial effectiveness and the capacity to understand
and respond to the complexities of life in today's turbulent
world.
Looking at events through the structural, human resource,
political, and symbolic lenses lessens the likelihood of
managers oversimplifying problems. The reframing process
increases the probability of seeing and solving real problems,
while encouraging leaders and managers to expand the scope
and flexibility of their own thinking.
Unit 1: Module 1 - Organizational Diagnosis
Organizational Diagnosis
An organizational diagnosis can help leaders and managers
identify and predict productivity issues. To be effective, the
diagnosis report needs to address the interaction of human
nature properties and of modern organizations, and their impact
on problems and pressures faced in everyday managerial life, to
effectively overcome these issues.
Organizations are typically complex entities, with a high level
of ambiguity present in many situations faced by their
leadership. This ambiguity can be the trigger for low
productivity, and it can occur when people are not sure how to
proceed. Questions that can arise in those circumstances are:

· What the problem is
· What's going on
· What they want or what to agree about
· What resources they need or are lacking
· Who's supposed to do what
· How to get what they want
· How to know if they have succeeded or failed
The use of reframing and multiple lenses to perform an
organizational diagnosis can help managers and leaders identify
issues, and find possible solutions from different perspectives.
For example, under the structural frame, every possible
structural configuration that can be considered to lead an
organization to a successful path has strengths and limitations.
Therefore, good diagnostic skills are essential for managers and
leaders who need strategies that fit the requirements of their
respective situations.
. Unit 1: Module 1 - Organizational Learning
Organizational Learning
Organizational learning can be connected to the development
necessary for a company to perform better. It is also related to
the dynamics of the marketplace: even companies that are
market leaders need to keep on evolving and developing to
sustain their competitive advantage, and consequently to keep
or increase their market share, reputation, and profits. The
current globalized market resembles a strategy game in which
the right pieces need to be moved the right way to guarantee
survival.
Organizational learning is achieved through a constant analysis
of the organization’s target market, and the alignment of
products and services offered with the current demands. The
development of employees is also crucial, as well as the
knowledge management in the organization. New developments

in technology coupled with new requirements for accountability
are leading organizations to generate increasingly massive
amounts of data. Organizations are only beginning to
understand how to use this data effectively to promote
educational improvement.
A learning organization is one that can successfully achieve the
goal of learning enough to maintain or gain its position in the
marketplace. This learning has to be shared with all internal
stakeholders and it should influence processes and procedures
being used to run the organization.
Module Wrap Up
Management situations nowadays present unexpected challenges
for the managers. You have learned how analyzing each
situation from multiple perspectives is very important. The
reframing process uses the four cognitive frames and plays an
important role in improving the thought process of managers. In
this module, you have also explored the concepts of
organizational diagnosis and organizational learning, and have
understood how they help an organization achieve or retain a
superior position in the competitive marketplace.
In the assignments for this module, you will first introduce
yourself to your instructor and peers. You will also read
scholarly articles on organizational learning and discuss from a
manager’s standpoint the applicability of organizational
learning. Along with these, you will start work on the literature
review that is due inModule 5 and the LASA that is due
in Module 7.

Reframing Organizations
Author:
Lee G. Bolman; Terrence E. Deal
Edition / Copyright:
4
Publisher:
John Wiley & Sons, Incorporated
· From the textbook, Reframing organizations: Artistry, choice,
and leadership, read the following chapters:
· Introduction: The Power of Reframing
· Simple Ideas, Complex Organizations
· From the online library resources, read:
Charan, R., & Useem, J. (2002). Why companies
fail. Fortune, 145(11), 50–62.
https://login.libproxy.edmc.edu/login?url=http://search.proquest
.com.libproxy.edmc.edu
/docview/213277482?accountid=34899Section:
FORTUNE
CEOs offer every excuse but the right one: their own errors.
Here are ten mistakes to avoid.
HOW MANY MORE MUST FALL? EACH MONTH SEEMS TO
BRING THE SOUND of another giant crashing to earth. Enron.
WorldCom. Global Crossing. Kmart. Polaroid. Arthur Andersen.
Xerox. Qwest. They fall singly. They fall in groups. They fall
with the heavy thud of employees laid off, families hurt,
shareholders furious. How many? Too many; 257 public
companies with $258 billion in assets declared bankruptcy last
year, shattering the previous year's record of 176 companies and
$95 billion. This year is on pace, with 67 companies going bust
during the first quarter. And not just any companies. Big,

important, Fortune 500 companies that aren't supposed to
collapse. If things keep going like this, we may have trouble
filling next year's list.
Why do companies fail? Their CEOs offer every excuse in the
book: a bad economy, market turbulence, a weak yen, hundred-
year floods, perfect storms, competitive subterfuge--forces, that
is, very much outside their control. In a few cases, such as the
airlines' post-Sept. 11 problems, the excuses even ring true. But
a close study of corporate failure suggests that, acts of God
aside, most companies founder for one simple reason:
managerial error.
We'll get to the errors in a moment. But first let's acknowledge
that, yes, failures usually involve factors unique to a company's
own industry or culture. As Tolstoy said of families, all happy
companies are alike; every unhappy company is unhappy in its
own way. Companies even collapse in their own way. Some go
out in blinding supernovas (Enron). Others linger like white
dwarfs (AT&AMP;T). Still others fizzle out over decades
(Polaroid). Failure is part of the natural cycle of business.
Companies are born, companies die, capitalism moves forward.
Creative destruction, they call it.
It was roughly this sentiment that Treasury Secretary Paul
O'Neill was trying to convey when he said that Enron's failure
was "part of the genius of capitalism." But aside from sounding
insensitive, O'Neill got one thing wrong. Capitalism's true
genius is to weed out companies that no longer serve a useful
purpose. The dot-coms, for instance, were experiments in
whether certain businesses were even viable. We found out:
They weren't. Yet many recent debacles were of companies that
could have lived long, productive lives with more enlightened
management--in other words, good companies struck down for
bad reasons. By these lights, Arthur Andersen's fall is no more
part of the "genius of capitalism" than the terrorism on Sept. 11
was part of the "genius of evolution."
By "failure," we don't necessarily mean bankruptcy. A dramatic
fall from grace qualifies too. In the most recent bear market, for

instance, 26 of America's 100 largest companies lost at least
two-thirds of their market value, including such blue chips as
Hewlett-Packard, Charles Schwab, Cisco, AT&AMP;T, AOL
Time Warner, and Gap. In the 1990 bear market, by contrast,
none did, according to money management firm Aronson
&AMP; Partners.
The sheer speed of these falls has been unnerving. Companies
that were healthy just moments ago, it seems, are suddenly at
death's door. But this impression may be misleading. Consider,
for instance, a certain Houston institution we've heard so much
about. There was no one moment when its managers sat down
and conspired to commit wrongdoing. Rather, the disaster
occurred because of what one analyst calls "an incremental
descent into poor judgment." A "success-oriented" culture,
mind-numbing complexity, and unrealistic performance goals
all mixed until the violation of standards became the standard.
Nothing looked amiss from the outside until, boom, it was all
over.
It sounds a lot like Enron, but the description actually refers to
NASA in 1986, the year of the space shuttle Challenger
explosion. We pull this switch not to conflate the two episodes--
one, after all, involved the death of seven astronauts--but to
make a point about failures: Even the most dramatic tend to be
years in the making. At NASA, engineers noticed damage to the
crucial O-rings on previous shuttle flights yet repeatedly
convinced themselves the damage was acceptable. Companies
fail the way Ernest Hemingway wrote about going broke in The
Sun Also Rises: gradually, and then suddenly. (For some
solutions, see "Three Quick Fixes.")
What undoes them is the familiar stuff of human folly: denial,
hubris, ego, wishful thinking, poor communication, lax
oversight, greed, deceit, and other Behind the Music plot
conventions. It all adds up to a failure to execute. This is not an
exhaustive list of corporate sins. But chances are your company
is committing one of them right now.
Softened by success

"Those whom the gods would destroy," Euripides wrote nearly
2,500 years ago, "they first make mad." In the modern update,
the gods send their victims 40 years of success. Actually, it's a
proven fact: A number of studies show that people are less
likely to make optimal decisions after prolonged periods of
success. NASA, Enron, Lucent, WorldCom--all had reached the
mountaintop before they ran into trouble. Someone should have
told them that most mountaineering accidents happen on the
way down.
Consider the case of Cisco Systems. While by no means a
failure, Cisco suffered a remarkable comedown in the spring of
2001--remarkable not only for its swiftness (its shares lost 88%
of their value in one year) but also because Cisco, more than
any other company, was supposed to be able to see into the
future. The basis of this belief was a much vaunted IT system
that enabled Cisco managers to track supply and demand in
"real time," allowing them to make pinpoint forecasts. The
technology, by all accounts, worked great. The forecasts,
however, did not. Cisco's managers, it turned out, never
bothered to model what would happen if a key assumption--
growth--disappeared from the equation. After all, the company
had recorded more than 40 straight quarters of growth; why
wouldn't the future bring more of the same?
The rosy assumptions, moreover, persisted even when evidence
to the contrary started piling up. Customers began going
bankrupt. Suppliers warned of a coming dropoff in demand.
Competitors stumbled. Even Wall Street wondered if the
Internet equipment market was falling apart. "I have never been
more optimistic about the future of our industry as a whole or of
Cisco," CEO John Chambers declared in December 2000, still
projecting 50% annual growth.
What was Chambers thinking? In The Challenger Launch
Decision, her definitive book on the disaster, Boston College
sociologist Diane Vaughan notes that people don't surrender
their mental models easily. "They may puzzle over
contradictory evidence," she writes, "but usually succeed in

pushing it aside--until they come across a piece of evidence too
fascinating to ignore, too clear to misperceive, too painful to
deny, which makes vivid still other signals they do not want to
see, forcing them to alter and surrender the world-view they
have so meticulously constructed."
For the perpetually sunny Chambers, that "piece of evidence"
did not come until April 2001, when cratering sales forced
Cisco to write down $2.5 billion in excess inventory and lay off
8,500 employees. Chambers may have been operating in real
time, but he wasn't operating in the real world.
See no evil
With $6.5 billion in cash and a strong competitive position,
Cisco will live to fight another day. Polaroid may not be so
lucky. Like its fellow old-economy stalwart Xerox, Polaroid
was a once-highflying member of the Nifty Fifty group of
growth stocks that lost their luster over the years. Eventually
the question "What does Polaroid make?" became a latter-day
version of "Who's buried in Grant's tomb?" Polaroid, that is,
made Polaroid cameras--period.
Time had passed the company by, you might say. Not exactly.
Think about another company that once seemed doomed to fail:
Intel. Back in 1985, competition from Japan was turning Intel's
memory chips into cheap commodities, and observers were all
but writing the company's obituary. Instead of going the way of
Polaroid, though, Intel decided to exit the memory business
entirely and become a maker of microprocessors. The key
insight occurred when Intel founders Andy Grove and Gordon
Moore sat down and asked themselves some tough questions. "If
we got kicked out and the board brought in a new CEO," Grove
asked Moore, "what do you think he would do?" Get out of
memory chips was the answer. From there, they said later, it
was just a matter of doing what needed to be done.
Polaroid and Xerox, by contrast, were slow to confront the
changing world around them. Executives at both companies
repeatedly blamed poor results on short-term factors--currency
fluctuations, trouble in Latin America--rather than the real

cause: a bad business model. By the time Xerox President (and
now CEO) Anne Mulcahy came out and spoke the truth--the
company had "an unsustainable business model," she told
analysts in 2000--Xerox was flirting with bankruptcy.
Jim Collins, author of the influential management books Built
to Last and Good to Great, has spent years studying what
separates great companies from mediocre ones. "The key sign--
the litmus test--is whether you begin to explain away the brutal
facts rather than to confront the brutal facts head-on," he says.
"That's sort of the pivot point." By forcing themselves to think
like outsiders, Grove and Moore recognized the brutal facts
before it was too late. Polaroid and Xerox didn't.
Fearing the boss more than the competition
Sometimes CEOs don't get the information they need to make
informed decisions. The main reason, says Daniel Goleman, a
psychologist and author of the book Primal Leadership, is that
subordinates are afraid to tell them the truth. Even when a boss
doesn't intend to quash dissent, subtle signals--a sour
expression, a curt response--can broadcast the message that bad
news isn't welcome. That's why, according to a study by
Goleman and two associates, higher-ranking executives are less
likely to have an accurate assessment of their own performance.
Fear can have its uses, of course; Andy Grove has long
espoused the value of competitive paranoia. But in unhealthy
situations, employees come to worry more about internal
factors--what the boss might say, what management might do--
than about threats from the outside world. Certainly this was the
case at Enron, where even alarm-ringer Sherron Watkins chose
to express her concerns anonymously rather than hazard one of
CEO Jeff Skilling's famous tongue-lashings. And she was one of
the brave ones.
The same problem hampered Samsung Chairman Lee Kun Hee
in 1997 when he decided to take Samsung into the auto
business. Knowing the car industry was a crowded field plagued
by overcapacity, many of Samsung's top managers silently
opposed the $13 billion investment. But Lee was a forceful

chairman and a car buff to boot. So when Samsung Motors
folded just a year into production, forcing Lee to spend $2
billion of his own money to placate creditors, he expressed
surprise: How come nobody had spoken up about their
reservations?
During World War II, Winston Churchill worried that his own
larger-than-life personality would deter subordinates from
bringing him bad news. So he set up a unit outside his generals'
chain of command, the Statistical Office, whose primary job
was to feed him the starkest, most unvarnished facts. In a
similar vein, Richard Schroth and Larry Elliott, authors of the
forthcoming book How Companies Lie, suggest designated
"counterpointers," whose function is to ask the rudest questions
possible. Such mechanisms take information and turn it into
information that can't be ignored.
Overdosing on risk
Some companies simply live too close to the edge. Global
Crossing, Qwest, 360networks--these telecom flameouts chose
paths that were not just risky but wildly imprudent. Their key
mistake: loading up on two kinds of risk at once.
The first might be called "execution risk." In their race to band
the earth in optical fiber, the telco upstarts ignored some key
questions: Namely, would anyone need all of this fiber?
Weren't there too many companies doing the same thing?
Wouldn't, uh, most of them fail? "People seemed to say,
'Maybe--but it's not going to be us,'" says Darrell Rigby, a Bain
&AMP; Co. consultant who studies managing during times of
turbulence. "Everyone thought they were immune."
On top of execution risk was another kind, which we'll call
liquidity risk. Global Crossing--run by Gary Winnick, formerly
of the junk-bond house Drexel Burnham Lambert--loaded up on
$12 billion of high-yield debt. This essentially limited Winnick
to a cannonball strategy: one shot, and if you miss, it's
bankruptcy.
Bankruptcy it was. Given the utter violence of the telecom
shakeout, you might say it was inevitable. But other telcos did

manage to escape the carnage. BellSouth, dismissed as
hopelessly conservative during the Wild West years, emerged
with a pristine balance sheet and a strong competitive position.
Its gentlemanly CEO, Duane Ackerman, was guided by a radical
idea: "being good stewards of our shareholders' money." What a
concept.
Acquisition lust
WorldCom founder Bernard Ebbers liked to eat. He ate MCI. He
ate MFS and its UUNet subsidiary. He tried to eat Sprint. Wall
Street helped him wash it all down with cheap capital and a
buoyant stock price. Pretty soon WorldCom was tipping the
scales at $39 billion in revenues. But there was a problem:
Ebbers didn't know how to digest the things he ate. A born
dealmaker, he seemed to care more about snaring new
acquisitions than about making the existing ones--all 75 of
them--work together. At least Ebbers was up front about it:
"Our goal is not to capture market share or be global," he told a
reporter in 1997. "Our goal is to be the No. 1 stock on Wall
Street."
The results were frequently chaotic. For a time, sales reps from
UUNet competed head-to-head with WorldCom sales teams for
corporate telecom contracts. Smaller customers complained they
had to call three different customer-service reps for their
Internet, long-distance, and local-phone inquiries. If there is
such a thing as negative synergy, WorldCom may have
discovered it.
Not that acquisitions are always so bad. General Electric
combines its acquisitive nature with an impressive ability to
break down acquisitions and integrate them into existing
operations. But too often CEOs succumb to an undisciplined
lust for growth, accumulating assets for the sake of
accumulating assets. Why? It's fun. There are lots of press
conferences. It's what powerful CEOs do. And like Ebbers,
whose WorldCom stock has lost 98% of its value, few wonder if
their eyes might be bigger than their stomachs.
Listening to Wall Street more than to employees

No one likes a good growth story better than Wall Street. And
in the late 1990s, no one was telling a better one than Lucent
CEO Rich McGinn. He knew how to give Wall Street what it
wanted--explosive top-line growth--and in return, Wall Street
turned McGinn and his team into rock stars. For a bunch of
former Bellheads, it was intoxicating stuff.
But while McGinn was busy performing for the Street, there
were at least two groups he wasn't listening to. The first was
Lucent's scientists, who feared the company was missing out on
a new optical technology, OC-192, that could transmit voice and
data faster. They pleaded in vain for its development, then
watched as rival Nortel rolled out OC-192 gear to thunderous
success. At the same time McGinn was neglecting Lucent's
salespeople, who might have told him that his growth targets
were becoming increasingly unrealistic. To meet them,
employees were pulling forward sales from future quarters by
offering steep discounts and wildly generous financing
arrangements, largely to dot-coms. "As we got further and
further behind," Chairman Henry Schacht later explained, "we
did more and more discounting."
It could only last so long. After Lucent stock had lost more than
80% of its value and he had replaced McGinn as CEO, Schacht
sat down with FORTUNE to ponder some hard-earned lessons.
"Stock price is a byproduct; stock price isn't a driver," he said.
"And every time I've seen any of us lose sight of that, it has
always been a painful experience." Top management needs to
understand what the folks on Wall Street want--but not
necessarily give it to them.
Strategy du jour
When companies run into trouble, the desire for a quick fix can
become overwhelming. The frequent result is a dynamic that
Collins describes in Good to Great: "A&AMP;P vacillated,
shifting from one strategy to another, always looking for a
single stroke to quickly solve its problems. [It] held pep rallies,
launched programs, grabbed fads, fired CEOs, hired CEOs and
fired them yet again." Lurching from one silver bullet solution

to another, the company never gained any traction.
Collins calls it the "doom loop," and it's a killer. Kmart is
another victim. In the 1980s and early '90s, Kmart was all about
diversification, shifting away from discounting to acquire stakes
in chains like Sports Authority, OfficeMax, and Borders
bookstores. But in the 1990s a new management team divested
those stores and decided to revamp Kmart's supply chain by
investing heavily in IT. That lasted for a while, until a new
CEO, Chuck Conaway, decided that, actually, Kmart would try
to beat Wal-Mart at its own game. This unleashed a disastrous
price war that in the end proved to be one mistake too many.
"When you look at companies that get themselves into trouble,"
says Collins, "they're often taking steps of great, lurching
bravado rather than quiet, deliberate understanding." Did
somebody say AT&AMP;T?
A dangerous corporate culture
Arthur Andersen, Enron, and Salomon Brothers were all brought
down, or nearly so, by the rogue actions of a tiny few. But the
bad apples in these companies grew and flourished in the same
kind of environment: a rotten corporate culture. It's impossible
to monitor the actions of every employee, no matter how many
accounting and compliance controls you put in place. But either
implicitly or explicitly, a company's cultural code is supposed
to equip front-line employees to make the right decisions
without supervision. At Salomon Brothers the culture did just
the opposite. The transgressor there was Paul Mozer, a trader
who in February of 1991 improperly overbid in auctions of U.S.
Treasury bonds. While it was another improper bid on May 22
that finally did him in, the critical event occurred in April,
when Salomon Chairman John Gutfreund learned of the
February overbid by Mozer and failed to discipline him. Mozer
evidently took Gutfreund's lack of action as a green light.
Salomon's culture of swashbuckling bravado encouraged risk
taking without accountability. Enron's culture encouraged profit
taking without disclosure. Andersen's culture engendered
conflicts of interest without safeguards. Rotten cultures produce

rotten deeds.
The new-economy death spiral
Alan Greenspan has his own theory on failure. Testifying about
Enron in February, he noted, "A firm is inherently fragile if its
value-added emanates more from conceptual as distinct from
physical assets.... Trust and reputation can vanish overnight. A
factory cannot." The speed of some recent crackups would seem
to confirm his thesis. The first domino falls when questions are
raised, sometimes anonymously. Wrongdoing is suspected.
Customers delay new orders. Rating agencies lower their debt
ratings. Employees head for the exits. More customers defect.
And voilà, you have what former Enron CEO Jeff Skilling has
called "a classic run on the bank."
Is it possible to halt one? Yes, but only if you stop the spiral
from building up speed. Salomon broke the cycle by hiring
Warren Buffett as interim CEO--essentially a giant credibility
infusion. By waiting several months to step down, on the other
hand, Arthur Andersen CEO Joseph Berardino lost whatever
chance he had to avoid disaster. Once started, the spiral can
bring a company whose main assets are people and ideas to its
knees with breathtaking finality.
A dysfunctional board
What was Enron's board thinking? Of all the infamous moments
in the company's demise, perhaps the least explicable was the
board's decision to waive Enron's code of ethics to
accommodate CFO Andrew Fastow's partnerships. "A red flag
the size of Alaska," says Nell Minow, founder of the board
watchdog group Corporate Library. Even Enron directors
belatedly agreed with this assessment. "After having authorized
a conflict of interest creating as much risk as this one," the
board's special investigation committee wrote in a February
report, "the board had an obligation to give careful attention to
the transactions that followed. It failed to do this.... In short, no
one was minding the store."
Despite a decade's worth of shareholder activism, Enron's board
was not an anomaly. The sorry fact is that most corporate

boards remain hopelessly beholden to management. "I was never
allowed to present to the board unless things were perfect," says
a former senior executive at Xerox, whose board includes
Vernon Jordan and former Senator George Mitchell. "You could
only go in with good news. Everything was prettied up." At
many boards, the CEO oversees meetings, hand-picks directors,
and spoon-feeds them information. "Directors know relatively
little apart from what management tells them," says John Smale,
a former CEO of Procter &AMP; Gamble and onetime chairman
of General Motors.
Unless, that is, the board demands more. "The CEO is always
going to want to turn the board meeting into a pep rally," says
Minow. "You've got to say to him, 'Look, I'm a busy person. I
don't have time for the good news. What I need for you to tell
me is the bad news.' It's like what Robert Duvall says in The
Godfather: 'I have to go to the airport. The Godfather is a man
who likes to hear bad news immediately.' That should be
emblazoned on every corporate governance policy sheet."
Paul O'Neill may have been wrong about his assessment of
Enron, but he was right about something else. "The great
companies don't make excuses," he said recently, "including
excuses about how they didn't do well because the economy was
against them or prices were not good. They do well anyway."
It's true. And it's something to think about the next time you
hear a CEO railing at the gods.
·
Chaturvedi, N. (2008). Management case: An interaction in
original. Vision,12(4), 71–77.
http://www.thecampuscommon.com/library/ezproxy/ticketdemoc
s.asp?sch=auo&turl=
http://search.ebscohost.com/login.aspx?direct=true&db=bth&A
N=36659227&site=
ehost-live MANAGEMENT CASE
AN INTERACTION IN ORIGINAL

Niraj Kr. Chaturvedi
The joint venture concern of a collaboration of two companies
hires a new HR Manager. The former company is an Indian
concern dealing in the transportation sector and the later on
deals on international logistics. This joint venture provides
logistics services to an automobile concern from Japan. An
email from Officer EXIM to the HR Manager of the company
leads to the initiative of an interaction that involves all staffs
from top to bottom hence a general meeting is called. The issues
are of haphazard work conditions in the venture and the souring
relationship of a senior staff with his junior counterpart. More
importantly, besides looking into the arenas to initiate cordial
work atmosphere, behaviour traits too are discussed. It is
focused that seniors should maintain the decorum and the
juniors should accept their responsibilities and work
accordingly. The emphasis is 'seniors must not talk loosely'
whatever the circumstances are in the organisation. An
organisation sustains upon respecting the sentiments and
potentials of every worker from top to the bottom. The
interaction ends, and the yearly appraisals, a year later, yields
the results - an outcome of cordial behaviour and self-respect.
Key Words : Industrial Relations in Logistical Services Firms,
Discipline and Employee Behaviour, Cultural Diversity and
Industrial Relations, Stake of Human Resources Department in
Resolving IR Conflicts
I
N the start of summer in 2007, Mr. Gaurav joined a joint
venture concern as HR Manager. The venture was formed in
collaboration of two companies from different boundaries. The
former one was an Indian concern having presence in the
transportation sector of the country and the later one was an
international logistics concern. This joint venture was primarily
responsible for providing logistics services to an automobile
concern hailing from Japan. The supervisory and middle level
managerial staffs of the venture including its HR Manager and

G.M Administration were on deputation from the Indian partner,
whereas the senior management team mostly consisted of its
foreign counterpart. The worker level with one officer and a
manager were on the payroll of this joint venture.
The new HR Manager was appointed after a gap of nearly six
months as the former HR Officer of this venture had left it at a
very short notice. The new HR Manager was earlier associated
with a leading Indian business school. He also had two years
hands on experience in the corporate sector. He was given an
opportunity to serve the venture because of his expertise and
educational qualification that was specialized in both logistics
and human resource management. The most challenging area
that he needed to deal in was to formulate the HR policies and
regulations of this joint venture in his current role.
The new HR Manager received a forwarded email from the
Manager of the Export and Import (EXIM) Department, Mr.
Singh on July 25, 2007. This email was sent in original by an
Officer of EXIM Department, Mr. Sanjeev Kumar that read like
this:
From: EXIM Department
To: Mr. Singh
Cc: GM-EXIM; Mr. Das, Assistant Manager- EXIM; Mr.
Panchaal, Trainee-EXIM; Miss Chatterjee, Trainee-EXIM; Miss
Rai, Trainee-EXIM
Sent: Wednesday, July 25, 2007 10:53 AM
Subject: Please suggest and imply a permanent solution of water
logging in the R&D warehouse.
72 Chaturvedi
Mr. Singh, Manager-EXIM. We have found water logged in the
R&D warehouse this morning. This has happened due to
overflow of water from the mess tank. We are facing lots of
problems in packing due to this. Please arrange some permanent
solution and sort out the issue.

Regards,
Sanjeev Kumar
Officer Import & Export
The HR Manager responds-
From: HR Department
To: Mr. Singh-EXIM Department
Cc: - Mr. Das, Assistant Manager-EXIM; Mr. Panchaal,
Trainee-EXIM; Miss Chatterjee, Trainee-EXIM; Miss Rai,
Trainee-EXIM
Sent: Wednesday, July 25, 2007 12:00 PM
Subject: Re: Please suggest and imply a permanent solution of
water logging in the R&D warehouse.
Dear Friend,
This is to inform you that we had already closed the leaking
wolves as early as possible by the times you had informed us
about this issue. It was, in fact, done in front of you that too
before you communicated this mail to us.
Thanks and Regards,
Team HR
'For You - For Us'
The reply of the mail was-
TEAM HR,
Thank you very much for your prompt response and co-
operation. But it was too late when you have parted with. The
problem still exists. Is it a permanent solution or what? We do
not know?
We are strongly concerned about the consequences that arise
due to this petty issue. We would not like to face any further
damage to R&D packing materials. Two material packed
cartoons have wetted due to this overflow today itself. The
grieving issue is water wetted items take rust sooner hence get
damaged.
You are requested to take some concrete action before further
overflow happens.
Regards,

Sanjeev Kumar
The HR Manager recieves another email next day-
From: EXIM
To: HR Department
Cc: GM-EXIM; GM-Administration; Manager-EXIM
Sent: Thursday, July 26, 2007 9:50 AM
Subject: Bad response of my boss, Mr. Singh
To,
The Manager-HR.
Sir,
Since I have joined the company on March 1, 2006,I am
performing my duties as per the guidelines and instructions of
the management. But I do not have the idea what goof up is
going on. Why it has happened for many a times that my boss,
Mr. Singh always responded my queries in a rude manner.
For example:-
On the 1st day of my joining when I met the Manager-EXIM,
Mr. Singh and requested him to brief me about my job profile
he responded me rudely. Mr. Singh responded that 'why I had
not asked about my job profile in the interview itself? I was told
that I should have come to him after knowing my
responsibilities from the interview board.'
As this reply had embarrassed me too much, I informed the
matter to the HR department and approached them to assign me
work. The HR department assigned me work in the warehouse. I
started working in the R&D section later on after having
received a call from the G.M-EXIM, who instructed me to do
so.
I have been involved in the following assignments since I joined
the organisation:
1. Meetings with the clients in the R&D section to make their
flowchart for export job,
2. Warehousing the client's material and keeping their records,
3. Packing of client's R&D materials and dispatching them as

per their instructions,
4. Acknowledging each and every mail associated with the
clients in R&D section to our seniors, as well as juniors,
5. Shared knowledge and information at each and every stage in
this period for the smooth functioning of this job,
6. Communicated with the vendors every time for sorting out
the related problems coming in our way particularly in billing
and quotations,
7. Checking of invoices of the company that were prepared by
Mr. Singh besides correcting and checking the bills of vendors
for payments,
VISION—The Journal of Business Perspective Vol. 12 No. 4
October–December 2008
Packing of client’s R&D materials and
An Interaction in Original 73
8. Making quotations as per the vendor's query and requirement
and finalising them with the help of G.M-EXIM.
9. Preparing quotations as per the queries and requirements
regarding the freight jobs. I did them in consultation with the
G.M,
10. Preparing Jobs File (under G.M's guidance) and the ledger
entries,
11. Looking EXIM accounts, except TALLY punching, and
12. Giving the Profit and Loss statement information to the
accounts department of the company.
I can firmly say that I have performed all kinds of jobs in the
EXIM department as and when I am to top do. I am confident
enough that our venture will now perform better in the freight
business now than we have done in the earlier occasions and
trials. But I was literally shocked yesterday evening when my
boss Mr. Singh rebuked me and advised to leave my job.
The bone of contention is based upon the wrong information and

associated misconceptions. He (Mr. Singh) informed me that
one of our clients had objected that the delivery place had been
mentioned wrongly. The bill was filed by me and signed by the
G.M Sir. I am unable to understand this. Even a three class
child can understand the name of the place being mentioned by
me.
We had requested Mr. Singh previously as well to provide us
with the details in written in case I could not grasp the inform.
Ironically he did not bother and replied our queries rudely. He
used to say that he would not write. Instead he intimidated me
by saying that 'either you understand by your own or leave this
job instantly.'
My point here is that our subordinates and I, i.e., all EXIM staff
except the G.M of this company depend upon the information
sought by Mr. Singh other than the emails that we receive. We
always respect him and seek his suggestions. But if the guardian
of the EXIM department would treat us with this way by such
wordings 'Leave the job' then how could we learn to be a good
manager and work efficiently? How would we improve our job
Proficiency in this catch22situation?
Please help me and guide for further plan of action.
Sanjeev Kumar
The HR Manager forwarded this email of Mr. Singh after
putting an additional note with a C.C to- G.M-EXIM, G.M-
Administration and M.D on Thursday, July 26, 2007 at 10:06
AM -
Dear Singh San,
We are in receipt of the following under mentioned grievance
from your subordinate Mr. Sanjeev Kumar. You are required to
state your facts in response to the same, by the earliest; to make
us understand the issue and arrive at a rational decision.
On Thursday, July 26, 2007 10:37 AM, there was a reply to the
HR Manager, General Manager-EXIM and GM-Administration-

Dear Sirs,
In regard to this issue raised by Mr. Sanjeev Kumar, I can only
reply in everybody's presence to which this issue has been
mentioned.
Singh
Co-Ordination Manager
Later the HR Manager wrote an email to the General Manager-
EXIM and GM-Administration, with C.C to Managing Director
at 10:45 AM--
Dear Sir,
You might have received the grievance mail of Mr. Sanjeev
Kumar from Export-Import Department (EXIM). I suggest that
we must call a meeting at the earliest to deal with the matter
and sort out the issue for smooth functioning of the activities of
our organisation.
Please guide with your response.
Thanks and regards,
Kumar Gaurav
Manager -Team HR
'For You - For Us'
The G.M-Administration sent an email to all at 10:50 AM the
same day-
Mr. Singh,
We have decided to call a meeting at 11.00 A. M.
Thanks and Regards,
G.M-Administration
The G.M Administration was in his office along with the G.M-
EXIM and HR Manager at 11:00 AM. They had the discussion-
G.M Administration: How was your trip to home?
G.M EXIM:OK! Japan is a lovely place
especially when it is your home.
G.M Administration: Let us begin the proceedings.
G.M EXIM:Do you know Sanjeev, Miss
Chatterjee and Miss Rai are at low

74 Chaturvedi
levels in the company. Mr. Singh scolded him for some valid
reasons; however, he should stop abusive talks.
G.M Administration: Seniors must not talk loosely. Every
person has some specific quality and self respect. They have
their own grudges. But respect must always be given to
everybody. I have called meetings twice or thrice to improve the
condition so that an understandable result comes up to certain.
Mr. Singh has been told many a times to give in writing about
the non-performers but he hardly took any action in this regard.
G.M EXIM:Let us call them to discuss the
matter.
G.M Administration: I think we must confront with
the third party first then the aggrieved and the culprit.
G.M EXIM:Ok! Call Mr. Das.
Interaction with Mr. Das- Assistant Manager-EXIM
G.M EXIM:How is Sanjeev's job?
Mr. Das:He has improved and is currently
responsible for the invoicing.
G.M EXIM:What was the condition before
theimplementationof
computerised system?
Mr. Das:The job was haphazard then. At
that time, one invoice used to take too much of time to
complete.
G.M EXIM:Now!
Mr. Das:Things have improved a lot.
G.M Administration: Which are the key areas that he
needs to improve?
Mr. Das:Calculations.
G.M Administration: He knows calculations or not?
Mr. Das:He asks whenever he is in

trouble. He has an urge for learning.
G.M EXIM:Even though Mr. Das and Mr.
Singh have taught him, still he makes mistakes.
G.M Administration: One person knows better and the other is
an amateur. The person who knows about the mistakes,
improves them better. We must review the performance of
Sanjeev on weekly basis and or fortnightly.
The matter here is not related to efficiency in the work. Rather
it is concerned with the behaviour. Seniors are responsible for
making the junior's level better.
G.M EXIM:We have waited for so long. I
don't want to continue with him.
HR Manager:Ok! Mr. Das, Thanks for your valuable inputs.
Please send Mr. Sanjeev to us by the time you reach your place
of working.
In Confrontation with Mr. Sanjeev Kumar G.M Administration:
What is the actual problem?
Sanjeev:I followed the exact instructions of Mr. Singh and now
he is complaining about the same in a rude manner.
G.M Administration: So you are annoyed with the
response of your seniors in case you do mistakes.
Sanjeev:I expect clear information at the first hand. He replies
rudely, and in that case how would we perform better. We must
be confirmed about the correct information.
G.M Administration: Why did not you come to us
earlier in writing?
Sanjeev:He doesn't write. Instead he always says me to quit the
job. He tells something else, thinks something else and does
something else.
G.M Administration: Suppose you have done a mistake
then what Mr. Singh might have done to you?

Sanjeev:He should warn appropriately.
And if it is his mistake then onus is on whom to prove?
HR Manager:What are the counter measures
you want?
Sanjeev:He must behave politely. My
efficiency is going down day by day due to this type of
treatment.
G.M Administration: Please get confirmed by Mr.
Singh in writing whenever you complete a task.
Sanjeev:I want written instructions all the time.
G.M EXIM:Written instructions will be given
in important cases only.
Sanjeev:Mr. Das and Mr. Singh are not putting their signatures
on all the documents. Sometimes only Mr. Das signs on them.
HR Manager:Mr. Sanjeev! We are working with your complaint
and will come out with a satisfying solution. In the meanwhile,
please wait for some moments outside the chamber and send Mr.
Singh to meet us.
In the Chamber of G.M-Administration with Mr. Singh-
Singh:Konnichiwa (Hello in Japanese)
G.M EXIM:Douitashmimashte (You are
welcome)
G.M Administration: Mr. Singh, we are here to discuss some
grievances raised against you by one of your colleagues. We
hope to get a clear picture from you.
Singh:Sanjeev prepared two bills. Our clients told that the bills
are not ok! I asked him for explanation, and he had the reply
that I told him to do so. He should not have done this and I told
him to quit the job if he is unable to perform. You can ask
others too.
I have some points to put-
- I cannot give everything in writing,
- The person committing a mistake must accept the same.

G.M Administration: This is not the first instance in the EXIM
department that such issues are being raised. I was trying to
bring the level at an equal front. It is your family problem.
Singh:Our Indian parental company appointed him without my
concern. The person should be competent and come to me at an
appropriate level.
G.M Administration: It is to be reminded that he is appointed by
the Japanese associates. He is the employee of the joint venture
and not a deputed employee like the Manager-HR and me.
Singh:If he doesn't accept his mistakes,
then how I would tolerate him?
G.M Administration: Earlier you have been warned Panchaal of
slapping him. He had informed it to our parental company's
head office. Next day I received a call from the Chairman of the
group. The whole issue is associated with behaviour.
You have always appraised Panchaal; now G.M EXIM is saying
that he is a low performer. I have urged several times to ask
explanation from the non-performers. Your department looks
highly intact as you people sit together in a round table format.
Singh:All are freshers. I can't tolerate. I
never said they are good performers. I said they will pickup.
G.M Administration: You could have demanded the
written explanation. It is our responsibility to motivate them.
76 Chaturvedi
Every person...
Singh:I tried to speak with you last
evening.
G.M Administration: We must respect each-other. It
is a give-n-take relationship.
Singh:Sanjeev is not reading all the
emails.

G.M EXIM:Ok! Ok! You should not use loose words while
talking with the juniors. I will advise Sanjeev to accept his
mistakes. I will further instruct him that he must read each and
every email.
G.M Administration: Mr. Singh, you should mail me
about the non-conduct of any of the jobs by Sanjeev.
Singh:I will not be responsible for other's mistakes. I am ready
to leave the post of manager. I will work as per your
instructions.
G.M Administration: I am not convinced with your statement.
We are managers here. It is our primary responsibility to check
and correct the mistakes of our juniors. I have been signing over
your documents and never complained. You must not skip from
your responsibilities.
Singh:Sanjeev often says to me that this company has selected
him hence only it can kick him out if need arises and I must not
interfere.
G.M Administration: He must not say like this and if
he persists then I will kick him out.
HR Manager:Sorry for interrupting! I think we have enough
discussion individually. Let us call everybody in the room and
resolve this issue amicably.
Sanjeev:He scolded with the words like-
'Go back to farming you villager.'
Singh:Whether I talked in such a way
with you?
Sanjeev:On the very first day we met.
G.M Administration: Please don't' fight like the road
warriors. We have come up with the conclusion that-
1. Mr. Sanjeev will have to be more serious about the
documentation and other related jobs.
2. Mr. Sanjeev should accept his mistakes as and when it
occurs, and should consult his seniors to resolve the same.
3. Mr. Singh will avoid using unofficial languages at the
workplace.

G.M EXIM:Mr. Gaurav! You should report to M.D-Mr. Takashi
San with the minutes of the meeting and the points we have
come up with.
On Friday, 27 July, 2007, the staff members of EXIM
department found their sitting arrangements changed at the start
of their office. The sitting arrangement of Mr. Singh and Mr.
Das were kept in their original positions, i.e., the tables were
intact that faced them each-other.
Mr. Sanjeev and the trainees were arranged to sit at a separate
place from their seniors.
Thereafter the HR Manager received a thanksgiving mail from
all staffs at 10:00 AM on July 28, 2007.
One month later, on the request of M.D, the HR Manager was
transferred to the Indian company's office but he left the
company and the G.M Export-Import was given an additional
responsibility to look both the departments after export-import
and administration until alternate arrangements are not done.
The yearly appraisals had the results. Mr. Singh was awarded
with 30% hike in the pay, the trainees got an extension of their
training period and Mr. Sanjeev was not considered for the next
appraisal. The post of HR manager does not exist in the venture
at present.
Managing Director
G.M Administration
Manager HR
Supervisor
G.M EXIM
A.G.M Trainee
Manager
Assistant Manager
Officer

Trainees
Figure 1: The Inter-Branch Chart
Niraj Kumar Chaturvedi ([email protected]) is a human resource
professional, associated with the Bank of India as Scale II
Officer in its HR Department. He has worked in various sectors
including steel, logistics and in academic sector as well at the
Indian Institute of Management, Ahmedabad. He has a
commerce background with an M.B.A and pursues Doctorate in
the area of employee motivation. He has bagged Gold Medal
with A.I.R 1st in Diploma Course conducted by the Ministry of
Railways in Logistics. He has contributed in the field of human
resource in a useful manner by associating with number of
educational and consultancy projects and publications in the
Indian journals .
Copyright of Vision (09722629) is the property of Management
bevelopment Institute and its content may not be copied or
emailed to multiple sites or posted to a listserv without the
copyright holder's express written permission. However, users
may print, download, or email articles for individual use.
· From the textbook, Reframing organizations: Artistry, choice,
and leadership, read the following chapters:
· Introduction: The Power of Reframing
Simple Ideas, Complex Organizations
chapter ONE Introduction: The Power of Reframing

Bob Nardelli expected to win the three-way competition to
succeed management legend Jack Welch as CEO of General
Electric. He was stunned when Welch told him late in 2000 that
he'd never run GE. The next day, though, he found out that he'd
won the consolation prize. A director of Home Depot called to
tell him, “You probably could not feel worse right now, but
you've just been hit in the ass with a golden horseshoe” (Sellers,
2002, p. 1).
Within a week, Nardelli hired on as Home Depot's new CEO. He
was a big change from the free-spirited founders, who had built
the wildly successful retailer on the foundation of an
uninhibited, entrepreneurial “orange” culture. Managers ran
their stores using “tribal knowledge,” and customers counted on
friendly, knowledgeable staff for helpful advice. Nardelli
revamped Home Depot with a heavy dose of command-and-
control management, discipline, and metrics. Almost all the top
executives and many of the frontline managers were replaced,
often by ex-military hires. At first, it seemed to work—profits
improved, and management experts hailed the “remarkable set
of tools” Nardelli used to produce “deep, lasting culture
change” (Charan, 2006, p. 1). But the lasting change included a
steady decline in employee morale and customer service. Where
the founders had successfully promoted “make love to the
customers,” Nardelli's toe-the-line stance pummeled Home
Depot to last place in its industry for customer satisfaction.
A growing chorus of critics harped about everything from the
declining stock price to Nardelli's extraordinary $245 million in
compensation. At Home Depot's 2006 shareholders’ meeting,
Nardelli hoped to keep naysayers at bay by giving them little
time to say anything and refusing to respond to anything they
did say: “It was, as even Home Depot executives will concede, a
37-minute fiasco. In a basement hotel ballroom in Delaware,
with the board nowhere in sight and huge time displays on stage
to cut off angry investors, Home Depot held a hasty annual
meeting last year that attendees alternately described as
‘appalling’ and ‘arrogant’” (Barbaro, 2007, p. C1). The outcry

from shareholders and the business press was scathing. Nardelli
countered with metrics to show that all was well. He seemed
unaware or unconcerned that he had embarrassed his board,
enraged his shareholders, turned off his customers, and
reinforced his reputation for arrogance and a tin ear. Nardelli
abruptly left Home Depot at the beginning of 2007 (Grow,
2007).
Nardelli's old boss, Jack Welch, called him the best operations
manager he'd ever seen. Yet, as talented and successful as he
was, Nardelli flamed out at Home Depot because he was only
seeing part of the picture. He was a victim of one of the most
common afflictions of leaders: seeing an incomplete or distorted
picture as a result of overlooking or misinterpreting important
signals. An extensive literature on business blunders attests to
the pervasiveness of this lost-at-sea state (see, for example,
Adler and Houghton, 1997; Feinberg and Tarrant, 1995; Ricks,
1999; Sobel, 1999).
Enron's demise provides another example of floundering in a
fog. In its heyday, Enron proclaimed itself the “World's Leading
Company”—with some justification. Enron had been a perennial
honoree on Fortune's list of “America's Most Admired
Companies” and was ranked as the “most innovative” six years
in a row (McLean, 2001, p. 60). Small wonder that CEO
Kenneth W. Lay was among the nation's most admired and
powerful business leaders. Lay and Enron were on a roll. What
could be wrong with such a big, profitable, innovative, fast-
growing company?
The trouble was that the books had been cooked, and the outside
auditors were asleep at the switch. In December 2001, Enron
collapsed in history's then-largest corporate bankruptcy. In the
space of a year, its stock plunged from eighty dollars to eighty
cents a share. Tens of billions of dollars in shareholder wealth
evaporated. More than four thousand people lost their jobs and,
in many cases, their savings and retirement funds.1 The auditors
also paid a steep price. Andersen Worldwide, a hundred-year-
old firm with a once-sterling reputation, folded along with

Enron.
What went wrong? After the cave-in, critics offered a profusion
of plausible explanations. Yet Enron's leaders seemed shocked
and baffled by the abrupt free fall. Former CEO Jeffrey K.
Skilling, regarded as the primary architect of Enron's high-
flying culture, was described by associates as “the ultimate
control freak. The sort of hands-on corporate leader who kept
his fingers on all the pieces of the puzzle” (Schwartz, 2002, p.
C1). Skilling resigned for unexplained “personal reasons” only
three months before Enron imploded. Many wondered if he had
jumped ship because he foresaw the iceberg looming dead
ahead. But after Enron's crash, he claimed, “I had no idea the
company was in anything but excellent shape” (p. C1).
Ultimately, in October 2006, both he and Lay were convicted of
multiple counts of fraud for their role in Enron's disintegration.
During their trials both steadfastly contended that they had done
nothing wrong. Enron, they insisted, had been a sound and
successful company brought down by forces they either weren't
aware of or couldn't control. Despite public opinion to the
contrary, both seemed to genuinely believe that they were
victims rather than villains.
Skilling and Lay were both viewed as brilliant men, yet both
sought refuge in cluelessness. It is easy to argue they claimed
ignorance only because they had no better defense. Even so,
they were out of touch at a deeper level. Lay and Skilling were
passionate about building Enron into the “World's Leading
Company.” They staunchly believed that they had created a
mold-breaking company with a revolutionary business model.
They knew risks were involved, but you have to bend or break
old rules when you're exploring uncharted territory. Investors
bought the stock, and business professors wrote articles about
the management lessons behind Enron's success. The snare was
that Lay and Skilling had misread their world and had no clue
that they were destroying the company they loved.
The curse of cluelessness is not limited to corporations—
government provides its share of examples. In August 2005,

Hurricane Katrina devastated New Orleans. Levees failed, and
much of the city was underwater. Tens of thousands of people,
many poor and black, found themselves stranded for days in
desperate circumstances. Government agencies bumbled
aimlessly, and help was slow to arrive. As Americans watched
television footage of the chaos, they were stunned to hear the
nation's top disaster official, the secretary of Homeland
Security, tell reporters that he “had no reports” of things
viewers had seen with their own eyes. It seemed he might have
been better informed if he had relied on CNN rather than his
own agency.
Homeland Security, Enron, and Home Depot represent only a
few examples of an endemic challenge: how to know if you're
getting the right picture or tuning in to the wrong channel.
Managers often fail this test. Cluelessness is a fact of life, even
for very smart people. Sometimes, the information they need is
fuzzy or hard to get. Other times, they ignore or misinterpret
information at hand. Decision makers too often lock themselves
into flawed ways of making sense of their circumstances. For
Lay and Skilling, it was a mistaken view that “we're different
from everyone else—we're smarter.” For Nardelli, it was his
conviction that his metrics gave him the full picture.
In the discussion that follows, we explore the origins and
symptoms of cluelessness. We introduce reframing—the
conceptual core of the book and our basic prescription for
sizing things up. Reframing requires an ability to think about
situations in more than one way. We then introduce four distinct
frames—structural, human resource, political, and symbolic—
each logical and powerful in its own right. Together, they help
us decipher the full array of significant clues, capturing a more
comprehensive picture of what's going on and what to do.
VIRTUES AND DRAWBACKS OF ORGANIZED ACTIVITY
Before the emergence of the railroad and the telegraph in the
mid-nineteenth century, individuals managed their own
affairs—America had no multiunit businesses and no need for
professional managers (Chandler, 1977). Explosive

technological and social changes have produced a world that is
far more interconnected, frantic, and complicated than it was in
those days. Humans struggle to catch up, at continual risk of
drowning in complexity that puts us “in over our heads”
(Kegan, 1998). Forms of management and organization effective
a few years ago are now obsolete. Sérieyx (1993) calls it the
organizational big bang: “The information revolution, the
globalization of economies, the proliferation of events that
undermine all our certainties, the collapse of the grand
ideologies, the arrival of the CNN society which transforms us
into an immense, planetary village—all these shocks have
overturned the rules of the game and suddenly turned
yesterday's organizations into antiques” (pp. 14–15).
The proliferation of complex organizations has made most
human activities collective endeavors. We grow up in families
and then start our own families. We work for business or
government. We learn in schools and universities. We worship
in synagogues, churches, and mosques. We play sports in teams,
franchises, and leagues. We join clubs and associations. Many
of us will grow old and die in hospitals or nursing homes. We
build these human enterprises because of what they can do for
us. They offer goods, entertainment, social services, health care,
and almost everything else that we use, consume, or enjoy.
All too often, however, we experience a darker side.
Organizations can frustrate and exploit people. Too often,
products are flawed, families are dysfunctional, students fail to
learn, patients get worse, and policies backfire. Work often has
so little meaning that jobs offer nothing beyond a paycheck. If
we can believe mission statements and public pronouncements,
every company these days aims to nurture its employees and
delight its customers. But many miss the mark. Schools are
blamed for social ills, universities are said to close more minds
than they open, and government is criticized for red tape and
rigidity. The private sector has its own problems. Automakers
drag their feet about recalling faulty cars. Producers of food and
pharmaceuticals make people sick with tainted products.

Software companies deliver bugs and “vaporware.” Industrial
accidents dump chemicals, oil, toxic gas, and radioactive
materials into the air and water. Too often, corporate greed and
insensitivity create havoc for individual lives and communities.
The bottom line: we seem hard-pressed to manage organizations
so that their virtues exceed their vices. The big question: Why?
The Curse of Cluelessness
Year after year, the best and brightest managers maneuver or
meander their way to the apex of enterprises great and small.
Then they do really dumb things. How do bright people turn out
so dim? One theory is that they're too smart for their own good.
Feinberg and Tarrant (1995) label it the “self-destructive
intelligence syndrome.” They argue that smart people act stupid
because of personality flaws—things like pride, arrogance, and
unconscious desires to fail. It's true that psychological flaws
have been apparent in such brilliant, self-destructive individuals
as Adolph Hitler, Richard Nixon, and Bill Clinton. But on the
whole, intellectually challenged people have as many
psychological problems as the best and brightest. The primary
source of cluelessness is not personality or IQ. We're at sea
whenever our sense-making efforts fail us. If our image of a
situation is wrong, our actions will be wide of the mark as well.
But if we don't realize our image is incorrect, we won't
understand why we don't get what we hoped for. So, like Bob
Nardelli, we insist we're right even when we're off track.
Vaughan (1995), in trying to unravel the causes of the 1986
disaster that destroyed the Challenger space shuttle and killed
its crew, underscored how hard it is for people to surrender
their entrenched mental models: “They puzzle over
contradictory evidence, but usually succeed in pushing it
aside—until they come across a piece of evidence too
fascinating to ignore, too clear to misperceive, too painful to
deny, which makes vivid still other signals they do not want to
see, forcing them to alter and surrender the world-view they
have so meticulously constructed” (p. 235).
All of us sometimes construct our own psychic prisons, and then

lock ourselves in. When we don't know what to do, we do more
of what we know. This helps explain a number of unsettling
reports from the managerial front lines:
•Hogan, Curphy, and Hogan (1994) estimate that the skills of
one-half to three-quarters of American managers are inadequate
for the demands of their jobs. But most probably don't realize it:
Kruger and Dunning (1999) found that the more incompetent
people are, the more they overestimate their performance, partly
because they don't know what good performance looks like.
•About half of the high-profile senior executives companies hire
fail within two years, according to a 2006 study (Burns and
Kiley, 2007).
•In 2003, the United States was again the world's strongest
economy, yet corporate America set a new record for failure
with two of history's top three bankruptcies—WorldCom at
$104 billion and Conseco at $61 billion. Charan and Useem
(2002) trace such failures to a single source: “managerial error”
(p. 52).
Small wonder that so many organizational veterans nod assent
to Scott Adams's admittedly unscientific “Dilbert principle”:
“the most ineffective workers are systematically moved to the
place where they can do the least damage—management” (1996,
p. 14).
Strategies for Improving Organizations: The Track Record
We have certainly made an effort to improve organizations.
Legions of managers report to work each day with that hope in
mind. Authors and consultants spin out a flood of new answers
and promising solutions. Policymakers develop laws and
regulations to guide organizations on the right path.
The most common improvement strategy is upgrading
management. Modern mythology promises that organizations
will work splendidly if well managed. Managers are supposed to
have the big picture and look out for their organization's overall
health and productivity. Unfortunately, they have not always
been equal to the task, even when armed with computers,
information systems, flowcharts, quality programs, and a

panoply of other tools and techniques. They go forth with this
rational arsenal to try to tame our wild and primitive
workplaces. Yet in the end, irrational forces too often prevail.
When managers cannot solve problems, they hire consultants.
Today, the number and variety of advice givers is
overwhelming. Most have a specialty: strategy, technology,
quality, finance, marketing, mergers, human resource
management, executive search, outplacement, coaching,
organization development, and many more. For every
managerial challenge, there is a consultant willing to offer
assistance—at a price.
For all their sage advice and remarkable fees, consultants have
yet to make a significant dent in problems plaguing
organizations—businesses, public agencies, military services,
hospitals, and schools. Sometimes the consultants are more
hindrance than help, though they often lament clients’ failure to
implement their profound insights. McKinsey & Co., “the high
priest of high-level consulting” (Byrne, 2002a, p. 66), worked
so closely with Enron that managing partner Rajat Gupta sent
his chief lawyer to Houston after Enron's collapse to see if his
firm might be in legal trouble. The lawyer reported that
McKinsey was safe, and a relieved Gupta insisted bravely, “We
stand by all the work we did. Beyond that, we can only
empathize with the trouble they are going through. It's a sad
thing to see” (p. 68).
When managers and consultants fail, government frequently
responds with legislation, policies, and regulations.
Constituents badger elected officials to “do something” about a
variety of ills: pollution, dangerous products, hazardous
working conditions, and chaotic schools, to name a few.
Governing bodies respond by making “policy.” A sizable body
of research records a continuing saga of perverse ways in which
the implementation process distorts policymakers’ intentions
(Bardach, 1977; Elmore, 1978; Freudenberg and Gramling,
1994; Peters, 1999; Pressman and Wildavsky, 1973).
Policymakers, for example, have been trying for decades to

reform U.S. public schools. Billions of taxpayer dollars have
been spent. The result? About the same as America's switch to
the metric system. In the 1950s Congress passed legislation
mandating adoption of the metric standards and measures. To
date, progress has been minimal (see Chapter Eighteen). If you
know what a hectare is, or can visualize the size of a three-
hundred-gram package of crackers, you're ahead of most
Americans. Legislators did not factor into their solution what it
would take to get their decision implemented.
In short, difficulties surrounding improvement strategies are
well documented. Exemplary intentions produce more costs than
benefits. Problems outlast solutions. It is as if tens of thousands
of hard-working, highly motivated pioneers keep hacking at a
swamp that persistently produces new growth faster than the old
can be cleared. To be sure, there are reasons for optimism.
Organizations have changed about as much in the past few
decades as in the preceding century. To survive, they had to.
Revolutionary changes in technology, the rise of the global
economy, and shortened product life cycles have spawned a
flurry of activity to design faster, more flexible organizational
forms. New organizational models flourish in companies such as
Pret à Manger (the socially conscious U.K. sandwich shops),
Google (a hot American company), and Novo-Nordisk (a Danish
pharmaceutical company that includes environmental and social
metrics in its bottom line). The dispersed collection of
enthusiasts and volunteers who provide content for Wikipedia
and the far-flung network of software engineers who have
developed the Linux operating system provide dramatic
examples of possibilities in the digital world. But despite such
successes, failures are still too common. The nagging key
question: How can leaders and managers improve the odds for
themselves as well for their organizations?
FRAMING
Goran Carstedt, the talented executive who led the turnaround
of Volvo's French division in the 1980s, got to the heart of a
challenge managers face every day: “The world simply can't be

made sense of, facts can't be organized, unless you have a
mental model to begin with. That theory does not have to be the
right one, because you can alter it along the way as information
comes in. But you can't begin to learn without some concept
that gives you expectations or hypotheses” (Hampden-Turner,
1992, p. 167). Such mental models have many labels—maps,
mind-sets, schema, and cognitive lenses, to name a few.2
Following the work of Goffman, Dewey, and others, we have
chosen the label frames. In describing frames, we deliberately
mix metaphors, referring to them as windows, maps, tools,
lenses, orientations, filters, prisms, and perspectives, because
all these images capture part of the idea we want to convey.
A frame is a mental model—a set of ideas and assumptions—
that you carry in your head to help you understand and negotiate
a particular “territory.” A good frame makes it easier to know
what you are up against and, ultimately, what you can do about
it. Frames are vital because organizations don't come with
computerized navigation systems to guide you turn-by-turn to
your destination. Instead, managers need to develop and carry
accurate maps in their heads.
Such maps make it possible to register and assemble key bits of
perceptual data into a coherent pattern—a picture of what's
happening. When it works fluidly, the process takes the form of
“rapid cognition,” the process that Gladwell (2005) examines in
his best-seller Blink. He describes it as a gift that makes it
possible to read “deeply into the narrowest slivers of
experience. In basketball, the player who can take in and
comprehend all that is happening around him or her is said to
have ‘court sense’” (p. 44).
Dane and Pratt (2007) describe four key characteristics of this
intuitive “blink” process:
•It is nonconscious—you can do it without thinking about it and
without knowing how you did it.
•It is very fast—the process often occurs almost instantly.
•It is holistic—you see a coherent, meaningful pattern.
•It results in “affective judgments”—thought and feeling work

together so you feel confident that you know what is going on
and what needs to be done.
The essence of this process is matching situational clues with a
well-learned mental framework—a “deeply-held, nonconscious
category or pattern” (Dane and Pratt, 2007, p. 37). This is the
key skill that Simon and Chase (1973) found in chess masters—
they could instantly recognize more than fifty thousand
configurations of a chessboard. This ability enables grand
masters to play twenty-five lesser opponents simultaneously,
beating all of them while spending only seconds on each move.
The same process of rapid cognition is at work in the diagnostic
categories physicians rely on to evaluate patients’ symptoms.
The Hippocratic Oath—“Above all else, do no harm”—requires
physicians to be confident that they know what they're up
against before prescribing a remedy. Their skilled judgment
draws on a repertoire of categories and clues, honed by training
and experience. But sometimes they get it wrong. One source of
error is anchoring: doctors, like leaders, sometimes lock on to
the first answer that seems right, even if a few messy facts don't
quite fit. “Your mind plays tricks on you because you see only
the landmarks you expect to see and neglect those that should
tell you that in fact you're still at sea” (Groopman, 2007, p. 65).
Treating individual patients is hard, but managers have an even
tougher challenge because organizations are more complex and
the diagnostic categories less well defined. That means that the
quality of your judgments depends on the information you have
at hand, your mental maps, and how well you have learned to
use them. Good maps align with the terrain and provide enough
detail to keep you on course. If you're trying to find your way
around downtown San Francisco, a map of Chicago won't help,
nor one of California's freeways. In the same way, different
circumstances require different approaches.
Even with the right map, getting around will be slow and
awkward if you have to stop and study at every intersection.
The ultimate goal is fluid expertise, the sort of know-how that
lets you think on the fly and navigate organizations as easily as

you drive home on a familiar route. You can make decisions
quickly and automatically because you know at a glance where
you are and what you need to do next.
There is no shortcut to developing this kind of expertise. It
takes effort, time, practice, and feedback. Some of the effort has
to go into learning frames and the ideas behind them. Equally
important is putting the ideas to use. Experience, one often
hears, is the best teacher, but that is only true if you reflect on
it and extract its lessons. McCall, Lombardo, and Morrison
(1988, p. 122) found that a key quality among successful
executives was an “extraordinary tenacity in extracting
something worthwhile from their experience and in seeking
experiences rich in opportunities for growth.”
Frame Breaking
Framing involves matching mental maps to circumstances.
Reframing requires another skill—the ability to break frames.
Why do that? A news story from the summer of 2007 illustrates.
Imagine yourself among a group of friends enjoying dinner on
the patio of a Washington, D.C., home. An armed, hooded
intruder suddenly appears and points a gun at the head of a
fourteen-year-old guest. “Give me your money,” he says, “or I'll
start shooting.” If you're at that table, what do you do? You
could try to break frame. That's exactly what Cristina “Cha
Cha” Rowan did.
“We were just finishing dinner,” [she] told the man. “Why don't
you have a glass of wine with us?”
The intruder had a sip of their Chateau Malescot St-Exupéry and
said, “Damn, that's good wine.”
The girl's father… told the intruder to take the whole glass, and
Rowan offered him the bottle.
The robber, with his hood down, took another sip and a bite of
Camembert cheese. He put the gun in his sweatpants….
“I think I may have come to the wrong house,” the intruder said
before apologizing. “Can I get a hug?”
Rowan… stood up and wrapped her arms around the would-be
robber. The other guests followed.

“Can we have a group hug?” the man asked. The five adults
complied.
The man walked away a few moments later with a filled crystal
wine glass, but nothing was stolen, and no one was hurt. Police
were called to the scene and found the empty wine glass
unbroken on the ground in an alley behind the house
[Associated Press, 2007].
In one stroke, Cha Cha Rowan redefined the situation from “we
might all be killed” to “let's offer our guest some wine.” Like
her, artistic managers frame and reframe experience fluidly,
sometimes with extraordinary results. A critic once commented
to Cézanne, “That doesn't look anything like a sunset.”
Pondering his painting, Cézanne responded, “Then you don't see
sunsets the way I do.” Like Cézanne and Rowan, leaders have to
find new ways to shift points of view when needed.
Like maps, frames are both windows on a territory and tools for
navigation. Every tool has distinctive strengths and limitations.
The right tool makes a job easier, but the wrong one gets in the
way. Tools thus become useful only when a situation is sized up
accurately. Furthermore, one or two tools may suffice for
simple jobs, but not for more complex undertakings. Managers
who master the hammer and expect all problems to behave like
nails find life at work confusing and frustrating. The wise
manager, like a skilled carpenter, wants at hand a diverse
collection of high-quality implements. Experienced managers
also understand the difference between possessing a tool and
knowing when and how to use it. Only experience and practice
bring the skill and wisdom to take stock of a situation and use
suitable tools with confidence and skill.
The Four Frames
Only in the last half century have social scientists devoted much
time or attention to developing ideas about how organizations
work, how they should work, or why they often fail. In the
social sciences, several major schools of thought have evolved.
Each has its own concepts and assumptions, espousing a
particular view of how to bring social collectives under control.

Each tradition claims a scientific foundation. But a theory can
easily become a theology that preaches a single, parochial
scripture. Modern managers must sort through a cacophony of
voices and visions for help.
Sifting through competing voices is one of our goals in writing
this book. We are not searching for the one best way. Rather,
we consolidate major schools of organizational thought into a
comprehensive framework encompassing four perspectives. Our
goal is usable knowledge. We have sought ideas powerful
enough to capture the subtlety and complexity of life in
organizations yet simple enough to be useful. Our distillation
has drawn much from the social sciences—particularly
sociology, psychology, political science, and anthropology.
Thousands of managers and scores of organizations have helped
us sift through social science research to identify ideas that
work in practice. We have sorted insights from both research
and practice into four major frames—structural, human
resource, political, and symbolic (Bolman and Deal, 1984).
Each is used by academics and practitioners alike and found on
the shelves of libraries and bookstores.
Four Frames: As Near as Your Local Bookstore
Imagine a harried executive browsing in the management
section of her local bookseller on a brisk winter day in 2008.
She worries about her company's flagging performance and
fears that her job might soon disappear. She spots the black-on-
white spine of The Last Link: Closing the Gap That Is
Sabotaging Your Business (Crawford, 2007). Flipping through
the pages, she notices chapter titles like “Data,” “Discipline,”
and “Linking It Together.” She is drawn to phrases such as “It
all comes down to one thing, doesn't it. Are you making your
numbers?” and “a new formula for 21st-century business
success.” “This stuff may be good,” the executive tells herself,
“but it seems a little stiff.”
Next, she finds The SPEED of Trust: The One Thing That
Changes Everything (Covey and Merrill, 2006). Glancing
inside, she reads, “Take communication. In a high-trust

relationship, you can say the wrong thing and people will still
get your meaning. In a low-trust relationship, you can be very
measured, even precise, and they'll still misinterpret you.”
“Sounds nice,” she mumbles, “but a little touchy-feely. Let's
look for something more down to earth.”
Continuing her search, she picks up Secrets to Winning at
Office Politics: How to Achieve Your Goals and Increase Your
Influence at Work (McIntyre, 2005). She scans chapter titles:
“Forget Fairness, Look for Leverage,” “Political Games: Moves
and Countermoves,” “Power, Power, Who Has the Power?” She
chews over the book's key message—that we all engage in
politics every day at work, even though we don't like to admit
it. “Does it really all come down to politics?” she wonders. “It
seems too cynical. Isn't there something more uplifting?”
She spots The Starbucks Experience: 5 Principles for Turning
Ordinary into Extraordinary (Michelli, 2006). She ponders the
five basic principles the book credits for the success of
Starbucks: Make it your own. Everything matters. Surprise and
delight. Embrace resistance. Leave your mark. She reads that
these principles “remind all of us—you, me, the janitor, and the
CEO—that we are responsible for unleashing a passion that
ripples outward from behind the scenes, through the customer
experience, and ultimately out into our communities” (p. 1). She
wonders if such fervor can be sustained for long.
In her local bookstore, our worried executive has rediscovered
the four perspectives at the heart of this book. Four distinct
metaphors capture the essence of each of the books she
examined: organizations as factories, families, jungles, and
temples or carnivals.
Factories
The first book she stumbled on, The Last Link, provides counsel
on how to think clearly and get organized, extending a long
tradition that treats an organization as a factory. Drawing from
sociology, economics, and management science, the structural
frame depicts a rational world and emphasizes organizational
architecture, including goals, structure, technology, specialized

roles, coordination, and formal relationships. Structures—
commonly depicted by organization charts—are designed to fit
an organization's environment and technology. Organizations
allocate responsibilities (“division of labor”). They then create
rules, policies, procedures, systems, and hierarchies to
coordinate diverse activities into a unified effort. Problems
arise when structure doesn't line up well with current
circumstances. At that point, some form of reorganization or
redesign is needed to remedy the mismatch.
Families
Our executive next encountered The SPEED of Trust, with its
focus on interpersonal relationships. The human resource
perspective, rooted in psychology, sees an organization as an
extended family, made up of individuals with needs, feelings,
prejudices, skills, and limitations. From a human resource view,
the key challenge is to tailor organizations to individuals—
finding ways for people to get the job done while feeling good
about themselves and their work.
Jungles
Secrets to Winning at Office Politics is a contemporary
application of the political frame, rooted in the work of political
scientists. It sees organizations as arenas, contests, or jungles.
Parochial interests compete for power and scarce resources.
Conflict is rampant because of enduring differences in needs,
perspectives, and lifestyles among contending individuals and
groups. Bargaining, negotiation, coercion, and compromise are
a normal part of everyday life. Coalitions form around specific
interests and change as issues come and go. Problems arise
when power is concentrated in the wrong places or is so broadly
dispersed that nothing gets done.
Solution

s arise from political skill and acumen—as Machiavelli
suggested centuries ago in The Prince ([1514] 1961).
Temples and Carnivals
Finally, our executive encountered The Starbucks Experience,
with its emphasis on culture, symbols, and spirit as keys to
organizational success. The symbolic lens, drawing on social
and cultural anthropology, treats organizations as temples,
tribes, theaters, or carnivals. It abandons assumptions of
rationality prominent in other frames and depicts organizations
as cultures, propelled by rituals, ceremonies, stories, heroes,
and myths rather than rules, policies, and managerial authority.
Organization is also theater: actors play their roles in the drama
while audiences form impressions from what they see on stage.
Problems arise when actors don't play their parts appropriately,
symbols lose their meaning, or ceremonies and rituals lose their
potency. We rekindle the expressive or spiritual side of
organizations through the use of symbol, myth, and magic.
The FBI and the CIA: A Four-Frame Story
A saga of two squabbling agencies illustrates how the four
frames provide different views of the same situation. Riebling
(2002) documents the long history of head-butting between
America's two intelligence agencies, the Federal Bureau of
Investigation and the Central Intelligence Agency. Both are
charged with combating espionage and terrorism, but the FBI's
authority is valid within the United States, while the CIA's

mandate covers everywhere else. Structurally, the FBI is housed
in the Department of Justice and reports to the attorney general.
The CIA reported through the director of central intelligence to
the president until 2004, when a reorganization put it under a
new director of national intelligence.
At a number of major junctures in American history (including
the assassination of President John F. Kennedy, the Iran-Contra
scandal, and the 9/11 terrorist attacks), each agency held pieces
of a larger puzzle, but coordination snafus made it hard for
anyone to see all the pieces, much less put them together. After
9/11, both agencies came under heavy criticism, and each
blamed the other for lapses. The FBI complained that the CIA
had known, but had failed to inform the FBI, that two of the
terrorists had entered the United States and had been living in
California since 2000 (Seper, 2005). But an internal Justice
Department investigation also concluded that the FBI didn't do
very well with the information it did get. Key signals were
never “documented by the bureau or placed in any system from
which they could be retrieved by agents investigating terrorist
threats” (Seper, 2005, p. 1).
Structural barriers between the FBI and the CIA were
exacerbated by the enmity between the two agencies’ patron
saints, J. Edgar Hoover and “Wild Bill” Donovan. When he first
became FBI director in the 1920s, Hoover reported to Donovan,
who didn't trust him and tried to get him fired. When World

War II broke out, Hoover lobbied to get the FBI identified as
the nation's worldwide intelligence agency. He fumed when
President Franklin D. Roosevelt instead created a new agency
and made Donovan its director. As often happens, cooperation
between two units was chronically hampered by a rocky
personal relationship between two top dogs who never liked one
another.
Politically, the relationship between the FBI and CIA was born
in turf conflict because of Roosevelt's decision to give
responsibility for foreign intelligence to Donovan instead of
Hoover. The friction persisted over the decades as both agencies
vied for turf and funding from Congress and the White House.
Symbolically, different histories and missions led to very
distinct cultures. The FBI, which built its image with the
dramatic capture or killing of notorious gang leaders, bank
robbers, and foreign agents, liked to pounce on suspects quickly
and publicly. The CIA preferred to work in the shadows,
believing that patience and secrecy were vital to its task of
collecting intelligence and rooting out foreign spies.
Senior U.S. officials have recognized for many years that the
conflict between the FBI and CIA damages U.S. security. But
most initiatives to improve the relationship have been partial
and ephemeral, falling well short of addressing the full range of
issues.
Multiframe Thinking

Exhibit 1.1. Overview of the Four-Frame Model.
The overview of the four-frame model in Exhibit 1.1 shows that
each of the frames has its own image of reality. You may be
drawn to some and repelled by others. Some perspectives may
seem clear and straightforward, while others seem puzzling. But
learning to apply all four deepens your appreciation and
understanding of organizations. Galileo discovered this when he
devised the first telescope. Each lens he added contributed to a
more accurate image of the heavens. Successful managers take
advantage of the same truth. Like physicians, they reframe,
consciously or intuitively, until they understand the situation at
hand. They use more than one lens to develop a diagnosis of
what they are up against and how to move forward.
This claim about the advantages of multiple perspectives has
stimulated a growing body of research. Dunford and Palmer
(1995) found that management courses teaching multiple frames
had significant positive effects over both the short and long
term—in fact, 98 percent of their respondents rated reframing as
helpful or very helpful, and about 90 percent felt it gave them a
competitive advantage. Other studies have shown that the
ability to use multiple frames is associated with greater
effectiveness for managers and leaders (Bensimon, 1989, 1990;
Birnbaum, 1992; Bolman and Deal, 1991, 1992a, 1992b;
Heimovics, Herman, and Jurkiewicz Coughlin, 1993, 1995;

Wimpelberg, 1987).
Multiframe thinking requires moving beyond narrow,
mechanical approaches for understanding organizations. We
cannot count the number of times managers have told us that
they handled some problem the “only way” it could be done.
Such statements betray a failure of both imagination and
courage and reveal a paralyzing fear of uncertainty. It may be
comforting to think that failure was unavoidable and we did all
we could. But it can be liberating to realize there is always
more than one way to respond to any problem or dilemma.
Those who master reframing report a sense of choice and power.
Managers are imprisoned only to the extent that their palette of
ideas is impoverished.
Akira Kurosawa's classic film Rashomon recounts the same
event through the eyes of several witnesses. Each tells a
different story. Similarly, organizations are filled with people
who have their own interpretations of what is and should be
happening. Each version contains a glimmer of truth, but each is
a product of the prejudices and blind spots of its maker. No
single story is comprehensive enough to make an organization
truly understandable or manageable. Effective managers need
multiple tools, the skill to use each, and the wisdom to match
frames to situations.3
Lack of imagination—Langer (1989) calls it “mindlessness”—is
a major cause of the shortfall between the reach and the grasp

of so many organizations—the empty chasm between noble
aspirations and disappointing results. The gap is painfully acute
in a world where organizations dominate so much of our lives.
The commission appointed by President George W. Bush to
investigate the terrorist attacks of September 11, 2001,
concluded that the strikes “should not have come as a surprise”
but did because the “most important failure was one of
imagination.” Taleb (2007) depicts events like the 9/11 attacks
as “black swans”—novel events that are unexpected because we
have never seen them before. If every swan we've observed is
white, we expect the same in the future. But fateful, make-or-
break events are more likely to be situations we've never
experienced before. Imagination is our best chance for being
ready when a black swan sails into view, and multiframe
thinking is a powerful stimulus to the broad, creative mind-set
imagination requires.
Engineering and Art
Exhibit 1.2. Expanding Managerial Thinking.
Exhibit 1.2 presents two contrasting approaches to management
and leadership. One is a rational-technical mind-set
emphasizing certainty and control. The other is an expressive,
artistic conception encouraging flexibility, creativity, and
interpretation. The first portrays managers as technicians; the
second sees them as artists.

Artists interpret experience and express it in forms that can be
felt, understood, and appreciated by others. Art embraces
emotion, subtlety, ambiguity. An artist reframes the world so
others can see new possibilities. Modern organizations often
rely too much on engineering and too little on art in searching
for quality, commitment, and creativity. Art is not a
replacement for engineering but an enhancement. Artistic
leaders and managers help us look beyond today's reality to new
forms that release untapped individual energies and improve
collective performance. The leader as artist relies on images as
well as memos, poetry as well as policy, reflection as well as
command, and reframing as well as refitting.
SUMMARY
As organizations have become pervasive and dominant, they
have also become harder to understand and manage. The result
is that managers are often nearly as clueless as the Dilberts of
the world think they are. The consequences of myopic
management and leadership show up every day, sometimes in
small and subtle ways, sometimes in organizational
catastrophes. Our basic premise is that a primary cause of
managerial failure is faulty thinking rooted in inadequate ideas.
Managers and those who try to help them too often rely on
constricted models that capture only part of organizational life.
Learning multiple perspectives, or frames, is a defense against
thrashing around without a clue about what you are doing or

why. Frames serve multiple functions. They are filters for
sorting essence from trivia, maps that aid navigation, and tools
for solving problems and getting things done. This book is
organized around four frames rooted in both managerial wisdom
and social science knowledge. The structural approach focuses
on the architecture of organization—the design of units and
subunits, rules and roles, goals and policies. The human
resource lens emphasizes understanding people, their strengths
and foibles, reason and emotion, desires and fears. The political
view sees organizations as competitive arenas of scarce
resources, competing interests, and struggles for power and
advantage. Finally, the symbolic frame focuses on issues of
meaning and faith. It puts ritual, ceremony, story, play, and
culture at the heart of organizational life.
Each of the frames is both powerful and coherent. Collectively,
they make it possible to reframe, looking at the same thing from
multiple lenses or points of view. When the world seems
hopelessly confusing and nothing is working, reframing is a
powerful tool for gaining clarity, regaining balance, generating
new options, and finding strategies that make a difference.
NOTES
1.Enron's reign as history's greatest corporate catastrophe was
brief. An even bigger behemoth, WorldCom, with assets of more
than $100 billion, thundered into Chapter 11 seven months later,
in July 2002. Stock worth more than $45 a share two years

earlier fell to nine cents.
2.Among the possible ways of talking about frames are
schemata or schema theory (Fiedler, 1982; Fiske and Dyer,
1985; Lord and Foti, 1986), representations (Frensch and
Sternberg, 1991; Lesgold and Lajoie, 1991; Voss, Wolfe,
Lawrence, and Engle, 1991), cognitive maps (Weick and
Bougon, 1986), paradigms (Gregory, 1983; Kuhn, 1970), social
categorizations (Cronshaw, 1987), implicit theories (Brief and
Downey, 1983), mental models (Senge, 1990), definitions of the
situation, and root metaphors.
3.A number of scholars (including Allison, 1971; Bergquist,
1992; Birnbaum, 1988; Elmore, 1978; Morgan, 1986; Perrow,
1986; Quinn, 1988; Quinn, Faerman, Thompson, and McGrath,
1996; and Scott, 1981) have made similar arguments for
multiframe approaches to groups and social collectives.
(Bolman 3)
Bolman, Lee G., Terrence E. Deal. Reframing Organizations:
Artistry, Choice, and Leadership, 4th Edition, 4th Edition. John
Wiley & Sons P&T, 11/2007.
<vbk:9781118178102#outline(1)>.
chapter TWO Simple Ideas, Complex Organizations
America's East Coast welcomed a crisp, sunny fall morning on
September 11, 2001. For airline passengers in the Boston–
Washington corridor, the perfect fall weather offered prospects

of on-time departures and smooth flights. The promise would be
broken for four flights, all bound for California. Like Pearl
Harbor, 9/11 was a day that will live in infamy, a tragedy that
changed America's sense of itself and the world. If we probe the
how and why of 9/11, we find determined and resourceful
terrorists, but we also find vulnerability and errors in
organizations charged with detecting and preventing such
catastrophes.
American Airlines flight 11 was first in the air, departing from
Boston on time at 8:00 am. United 175 followed at 8:15, ten
minutes behind schedule. American 77, after a twenty-minute
delay, left Washington-Dulles at 8:20 am. Delayed forty
minutes by congestion at Newark, United flight 93 departed at
8:42 am.
The first sign that something was amiss for American 11 came
less than fifteen minutes into the flight, when pilots stopped
responding to input from air traffic controllers. For United 175,
signs surfaced when the aircraft changed beacon codes, deviated
from its assigned altitude, and failed to respond to New York
air traffic controllers. American 77 departed from its assigned
course at 8:54 am, and attempts to communicate with the plane
were futile. The last flight, United 93, followed a routine
trajectory until the aircraft dropped precipitously. The captain
radioed “Mayday,” and controllers heard sounds of a violent
struggle in the cockpit.

All four planes had been hijacked by teams of Al Quaeda
terrorists who had managed to board the planes in spite of a
security checkpoint system aimed at preventing such
occurrences. In a meticulously planned scheme, the terrorists
turned commercial aircraft into deadly missiles. Each aircraft
was aimed at a high-profile target—New York's World Trade
Center, the Pentagon, and the nation's Capitol. One by one, the
planes slammed into their targets with devastating force. Only
United 93 failed to reach its objective. A heroic passenger effort
to regain control of the plane failed but thwarted the terrorists’
intentions to ram the White House or Capitol building.
Why did no one foresee such a catastrophe? In fact, some had.
As far back as 1993, security experts had envisioned an attempt
to destroy the World Trade Center using airplanes as weapons.
Such fears were reinforced when a suicidal pilot crashed a small
private plane onto the White House lawn in 1994. But the mind-
set of principals in the national security network was riveted on
prior hijacks, which had almost always ended in negotiations.
The idea of a suicide mission, using commercial aircraft as
missiles, was never incorporated into homeland defense
procedures.
America's homeland air defense system fell primarily under the
jurisdiction of two government agencies: the Federal Aviation
Administration (FAA) and the North American Aerospace
Defense Command (NORAD). As the events of 9/11 unfolded, it

became clear that these agencies’ procedures to handle
hijackings were inadequate. The controller tracking American
11, for example, began to suspect a hijacking early on and
relayed the information to regional FAA headquarters, which
began to follow its hijack protocol. As part of that protocol, a
designated hijack coordinator could have requested a military
fighter escort for the hijacked aircraft—but none was requested
until too late.
At the same time, communication channels fell behind fast-
moving events. Confusion at FAA headquarters resulted in a
delay in informing NORAD about United 93. An interagency
teleconference to provide coordination between the military and
the FAA was hastily put together, but technical delays kept the
FAA from participating. When NORAD asked for FAA updates,
they got either no answer or incorrect information. Long after
American 11 crashed into the World Trade Center, NORAD
thought the flight was still headed toward Washington, D.C.
In the end, nineteen young men were able to outwit America's
homeland defense systems. We can explain their success in part
by pointing to their fanatical determination, meticulous
planning, and painstaking preparation. Looking deeper, we can
see a dramatic version of an old story: human error leading to
tragedy. But if we look deeper still, we find that even the
human-error explanation is too simple. In organizational life,
there are almost always systemic causes upstream of human

failures, and the events of 9/11 are no exception.
The nation had a web of procedures and agencies aimed at
detecting and monitoring potential terrorists. Those systems
failed, as did procedures designed to respond to aviation crises.
Similar failures have marked other well-publicized disasters:
nuclear accidents at Chernobyl and Three Mile Island, for
example, and the botched response to Hurricane Katrina on the
Gulf Coast in 2005. Each event illustrates a chain of error,
miscommunication, and misguided actions.
Events like 9/11 and Katrina make headlines, but similar errors
and failures happen every day. They rarely make front-page
news, but they are all too familiar to people who work in
organizations. The problem is that organizations are
complicated, and communication among them adds another
tangled layer. Reading messy situations accurately is not easy.
In the remainder of this chapter, we explain why. We discuss
how the fallacies of human thinking can obscure what's really
going on and lead us astray. Then we describe some
peculiarities of organizations that make them so difficult to
figure out and manage.
COMMON FALLACIES IN EXPLAINING ORGANIZATIONAL
PROBLEMS
Albert Einstein once said that a thing should be made as simple
as possible, but no simpler. When we ask students and managers
to analyze cases like 9/11 they often make things simpler than

they really are. They do this by relying on one of three
misleading, oversimplified one-size-fits-all concepts.
The first and most common is blaming people. This approach
casts everything in terms of individual blunders. Problems
result from bad attitudes, abrasive personalities, neurotic
tendencies, stupidity, or incompetence. It's an easy way to
explain anything that goes wrong. Once Enron went bankrupt,
the hunt was on for someone to blame, and the top executives
became the target of reporters, prosecutors, and talk-show
comedians. One CEO said, “We want the bad guys exposed and
the bad guys punished” (Toffler and Reingold, 2004, p. 229).
As children, we learned it was important to assign blame for
every broken toy, stained carpet, or wounded sibling.
Pinpointing the culprit is comforting. Assigning blame resolves
ambiguity, explains mystery, and makes clear what must be
done next: punish the guilty. Enron had its share of culpable
individuals, some of whom eventually went to jail. But there is
a larger story about the organizational and social context that
set the stage for individual malfeasance. Targeting individuals
while ignoring larger system failures oversimplifies the problem
and does little to prevent its recurrence.
GREATEST HITS FROM ORGANIZATION STUDIES
Hit Number 10: James G. March and Herbert A. Simon,
Organizations (New York: Wiley, 1958)
March and Simon's pioneering 1958 book Organizations sought

to define a new field by offering a structure and language for
studying organizations. It was part of the body of work that
helped to earn Simon the 1978 Nobel Prize for economics.1
No brief summary can cover the range of topics March and
Simon considered. They offered a cognitive, social-
psychological view of organizational behavior with an emphasis
on thinking, information processing, and decision making. The
book begins with a model of behavior that presents humans as
continually seeking to satisfy motives based on their
aspirations. Aspirations at any given time are a function of both
individuals’ history and their environment. When aspirations
are unsatisfied, people search until they find better, more
satisfying options. Organizations influence individuals
primarily by managing the information and options, or “decision
premises,” that they consider.
March and Simon followed Simon's earlier work (1947) in
critiquing the economic view of “rational man,” who maximizes
utility by considering all available options and choosing the
best. Instead, they argue that both individuals and organizations
have limited information and restricted ability to process what
is available. They never will know all the options. Instead, they
gradually alter their aspirations as they search for alternatives.
Instead of looking for the best option, “maximizing,”
individuals and organizations “satisfice,” choosing the first
option that is good enough.

Organizational decision making is additionally complicated
because the environment is complex. Resources (time, attention,
money, and so on) are scarce, and conflict among individuals
and groups is constant. Organizational design happens through
piecemeal bargaining that holds no guarantee of optimal
rationality. Organizations simplify the environment to reduce
the pressure on limited information-processing and decision-
making capacities. They simplify by developing “programs”—
standardized routines for performing repetitive tasks. Once a
program is in place, the incentive is to stay with it as long as
the results are marginally satisfactory. Otherwise, the
organization is forced to expend time and energy to innovate.
Routine tends to drive out innovation, because individuals find
it easier and less taxing to devote limited time and energy to
programmed tasks (which are automatic, well practiced, and
more certain of success). Thus, a student facing a term-paper
deadline may find it easier to “fritter”—make tea, rearrange the
desk, check e-mail, and browse the Web—than to figure out
how to write a good opening paragraph. A manager may
sacrifice quality to avoid changing a well-established routine.
March and Simon's book falls primarily within the structural
and human resource views. But their discussions of scarce
resources, power, conflict, and bargaining recognize the reality
of organizational politics. Although they do not use the term
framing, March and Simon reaffirm its logic as an essential

component of choice. Decision making, they argue, is always
based on a simplified model of the world. Organizations
develop unique vocabulary and classification schemes, which
determine what people are likely to see and respond to. Things
that don't fit an organization's mind-set are likely to be ignored
or reframed into terms the organization can understand.
When it is hard to identify a guilty individual, a second popular
option is blaming the bureaucracy. Things go haywire because
organizations are stifled by rules and red tape—or because a
lack of clear goals and roles creates chaos. One or the other
explanation almost always applies. If things are out of control,
then the system needs clearer rules and procedures, as well as
tighter job descriptions. The 9/11 terrorist attacks could have
been thwarted if agencies had had better protocols for such a
terrorist attack. Tighter financial controls could have prevented
Enron's free fall. The problem is that piling on rules and
regulations typically leads to bureaucratic rigidity. Rules inhibit
freedom and flexibility, stifle initiative, and generate reams of
red tape. Could Enron have achieved its status as America's
most innovative company if it had played by the old rules?
When things become too tight, the solution is to “free up” the
system so red tape and rigid rules don't stifle creativity and bog
things down. But many organizations vacillate endlessly
between being too loose and too tight.
A third fallacy attributes problems to thirsting for power. In the

case of Enron, key executives were more interested in getting
rich and expanding their turf than in advancing the company's
best interests. The various agencies dealing with 9/11 all
struggled prior to the disaster for their share of scarce federal
resources. This view sees organizations as jungles teeming with
predators and prey. Victory goes to the more adroit, or the more
treacherous. Political games and turf wars cause most
organizational problems. You need to play the game better than
your opponents—and watch your backside.
Each of these three perspectives contains a kernel of truth but
oversimplifies a knottier reality. Blaming people points to the
perennial importance of individual responsibility. Some
problems are caused by personal characteristics: rigid bosses,
slothful subordinates, bumbling bureaucrats, greedy union
members, or insensitive elites. Much of the time, though,
condemning individuals blocks us from seeing system
weaknesses and offers few workable options. If, for example,
the problem really is someone's abrasive or pathological
personality, what do we do? Even psychiatrists find it hard to
alter character disorders, and firing everyone with a less-than-
ideal personality is rarely a viable option. Training can go only
so far in preparing people to carry out their responsibilities
perfectly every time.
The blame-the-bureaucracy perspective starts from a reasonable
premise: organizations are created to achieve specific goals.

They are most effective when goals and policies are clear (but
not excessive), jobs are well defined (but not constricting),
control systems are in place (but not oppressive), and
employees behave prudently (but not callously). If
organizations always behaved that way, they would presumably
work a lot better than most do. In practice, this perspective is
better at explaining how organizations should work than why
they often don't. Managers who cling to facts and logic become
discouraged and frustrated when confronted by intractable
irrational forces. Year after year, we witness the introduction of
new control systems, hear of new ways to reorganize, and are
dazzled by emerging management methods and gurus. Yet old
problems persist, seemingly immune to every rational cure we
devise. As March and Simon point out, rationality has limits.
The thirst-for-power view highlights enduring, below-the-
surface features of organizations. Its dog-eat-dog logic offers a
plausible analysis of almost anything that goes wrong. People
both seek and despise power but find it a convenient way to
explain problems. Within hours of the 9/11 terror attacks, a
senior FBI official called Richard Clarke, America's
counterterrorism czar, to tell him that many of the terrorists
were known members of Al Quaeda. “How the f__k did they get
on board then?” Clarke exploded. “Hey, don't shoot the
messenger. CIA forgot to tell us about them.” In the context of
the long-running battle between the FBI and CIA, the

underlying message of blame was clear: the CIA's self-
interested concern with its own power caused this catastrophe.
The tendency to blame what goes wrong on people, the
bureaucracy, or the thirst for power is part of our mental wiring.
But there's much more to understanding a complex situation
than assigning blame. Certain universal peculiarities of
organizations make them especially difficult to sort out.
PECULIARITIES OF ORGANIZATIONS
Human organizations can be exciting and challenging places. At
least, that's how they are often depicted in management texts,
corporate annual reports, and fanciful managerial thinking. But
in reality they can be deceptive, confusing, and demoralizing. It
is a mistake to assume that organizations are either snake pits or
rose gardens (Schwartz, 1986). Managers need to recognize
characteristics of life at work that create opportunities for the
wise as well as traps for the unwary. A case from the public
sector provides a typical example:
DECEPTION AT WORK
Helen Demarco arrived in her office to discover a clipping from
the local paper. The headline read, “Osborne Announces Plan.”
Paul Osborne had arrived two months earlier as Amtran's new
chief executive. His mandate was to “revitalize, cut costs, and
improve efficiency.” After twenty years, Demarco had achieved
a senior management position at the agency. She had little
contact with Osborne, but her boss reported to him. Along with

long-term colleagues, Demarco had been waiting apprehensively
to learn what the new chief had in mind. She was startled as she
read the newspaper account. Osborne's plan made technical
assumptions directly related to her area of expertise. He might
be a change agent, she thought, but he doesn't know much about
our technology. She saw immediately the new plan's fatal flaws.
If he tries to implement this, it'll be the worst management
mistake since the Edsel, she thought to herself.
Two days later, Demarco and her colleagues received a memo
instructing them to form a committee to work on the
revitalization plan. When the group convened, everyone agreed
the plan was crazy.
“What do we do?” someone asked.
“Why don't we just tell him it won't work?” said one hopeful
soul.
“He's already gone public! You want to tell him his baby is
ugly?”
“Not me. Besides, he already thinks a lot of us are deadwood. If
we tell him it's no good, he'll just think we're defensive.”
“Well, we can't just go ahead with it. We'd be throwing away
money and it'll never work!”
“That's true,” said Demarco thoughtfully. “But what if we tell
him we're conducting a study of how to implement the plan?”
Her suggestion was approved overwhelmingly. The group
informed Osborne that a study was under way. They even got a

substantial budget to support their “research.” No one
mentioned the study's real purpose: buy time and find a way to
minimize the damage without alienating the boss.
Over time, the group developed a strategy. Members assembled
a lengthy technical report, filled with graphs, tables, and
impenetrable jargon. The report offered Osborne two options.
Option A, his original plan, was presented as technically
feasible but expensive—well beyond anything Amtran could
afford. Option B, billed as a “modest downscaling” of the
original plan, was projected as a more cost-effective alternative.
When Osborne pressed the group on the huge cost disparity
between the two proposals, he received a barrage of technical
language and complicated cost-benefit projections. No one
mentioned that even Option B offered few benefits at a very
high cost. Osborne argued and pressed for more information.
But given the apparent facts, he agreed to proceed with Option
B. The plan required several years to implement, and Osborne
moved on before it became operational. Even so, the “Osborne
plan” was widely heralded as another instance of Paul Osborne's
talent for revitalizing ailing organizations.
Helen Demarco came away with deep feelings of frustration and
failure. The Osborne plan, in her view, was a wasteful mistake,
and she had knowingly participated in a charade. “But,” she
rationalized to herself, “I really didn't have much choice.
Osborne was determined to go ahead. It would have been career

suicide to try to stop him.”
Demarco had other options, but she couldn't see them. She and
Paul Osborne both thought they were on track. They were
tripped up in part by human fallibility, but even more important,
by how hard it can be to understand organizations. The first step
in managerial wisdom and artistry is to recognize key
characteristics of organizations. Otherwise, managers are
persistently surprised and caught off guard.
First, organizations are complex. They are populated by people,
whose behavior is notoriously hard to predict. Large
organizations in particular include a bewildering array of
people, departments, technologies, and goals. Moreover,
organizations are open systems dealing with a changing,
challenging, and erratic environment. Things can get even more
knotty across multiple organizations. The 9/11 disaster resulted
from a chain of events that involved several separate systems.
Almost anything can affect everything else in collective
activity, generating causal knots that are hard to untangle. After
an exhaustive investigation, our picture of 9/11 is woven from
sundry evidence, conflicting testimony, and conjecture.
Second, organizations are surprising. What you expect is often
not what you get. Paul Osborne saw his plan as a bold leap
forward; Helen and her group considered it an expensive
albatross. In their view, Osborne made matters worse by trying
to improve them. He might have achieved better results by

spending more time with his family and leaving things at work
alone. And imagine the shock of Enron's executives when things
fell apart. Until shortly before the bottom fell out, the
company's leadership team appeared confident they were
building a pioneering model of corporate success. Many
analysts and management professors shared their optimism.
The solution to yesterday's problems often creates future
obstacles. A friend of ours was president of a retail chain. In the
firm's early years, he had a problem with two sisters who
worked in the same store. To prevent this from recurring, he
established a nepotism policy prohibiting members of the same
family from working for the company. Years later, two key
employees met at work, fell in love, and began to live together.
The president was stunned when they asked if they could get
married without being fired. As in this case, today's sensible
choice may turn into tomorrow's regret. Taking action in a
cooperative venture is like shooting a wobbly cue ball into a
scattered array of self-directed billiard balls. Balls career in so
many directions that it is impossible to know how things will
eventually sort out.
Third, organizations are deceptive. They camouflage mistakes
and surprises. After 9/11, America's homeland defense
organizations tried to conceal their lack of preparedness and
confusion for fear of revealing strategic weaknesses. Enron
raised financial camouflage to an art form with a series of

sophisticated partnerships (carrying Star Wars names like
Chewco, Jedi, and Kenobe). Helen Demarco and her colleagues
disguised obfuscation as technical analysis in hopes of fooling
the boss.
It is tempting to blame deceit on individual character flaws. Yet
Helen Demarco disliked fraud and regretted cheating—she
simply believed she had no other alternative. Sophisticated
managers know that what happened to Paul Osborne happens all
the time. When a quality initiative fails or a promising product
tanks, subordinates often either clam up or cover up. They fear
that the boss will not listen or will punish them for being
insubordinate. Thus early warnings that terrorists might
commandeer commercial airliners went unvoiced or unheeded.
Internal naysayers at Enron were silenced until dissenters “blew
the whistle” publicly. A friend in a senior position in a large
government agency put it simply: “Communications in
organizations are rarely candid, open, or timely.”
Fourth, organizations are ambiguous. Complexity,
unpredictability, and deception generate rampant ambiguity, a
dense fog that shrouds what happens from day to day. Figuring
out what is really going on in businesses, hospitals, schools, or
public agencies is not easy. It is hard to get the facts and, if you
pin them down, even harder to know what they mean or what to
do about them. Helen Demarco never knew how Paul Osborne
really felt, how receptive he was to other points of view, or how

open he was to compromise. She and her peers piled on more
mystery by conspiring to keep him in the dark. As the 9/11 case
illustrates, when you incorporate additional organizations into
the human equation, uncertainty mushrooms.
Ambiguity has many sources. Sometimes available information
is incomplete or vague. Different people may interpret the same
information in a variety of ways, depending on mind-sets and
organizational doctrines. At other times, ambiguity is
intentionally manufactured as a smoke screen to conceal
problems or steer clear of conflict. Much of the time, events and
processes are so intricate, scattered, and uncoordinated that no
one can fully understand—let alone control—the real truth.
Exhibit 2.1 lists some of the most important sources of
organizational uncertainty.
Exhibit 2.1. Sources of Ambiguity.
Source: Adapted from McCaskey (1982).
ORGANIZATIONAL LEARNING
How can lessons be extracted from surroundings that are
complex, surprising, deceptive, and ambiguous? It isn't easy.
Yet turbulent, rapidly shifting situations require organizations
to learn better and faster. Michael Dell, founder and CEO of
Dell Computer Corporation, explained it this way: “In our
business, the product cycle is six months, and if you miss the
product cycle, you've missed the opportunity. In this business,

there are two kinds of people, really: the quick and the dead”
(Farkas and De Backer, 1996).
With stakes so high, how organizations learn from experience
has become a timely topic. Decades ago, scholars debated
whether the idea of organizational learning made sense: Could
organizations actually learn, or was learning inherently
individual? That debate lapsed as experience verified instances
where individuals learned and organizations didn't, or vice
versa. Complex firms such as Microsoft, Toyota, and British
Airways have “learned” capabilities far beyond individual
knowledge. Lessons are enshrined in acknowledged protocols
and shared cultural codes and traditions. At the same time,
individuals often learn when systems cannot.
From the late 1980s onward, senior officials in China
recognized that the nation was heading in two contradictory
directions, promoting capitalism economically while defending
communism politically. Behind the scenes, party members
began an urgent search for a way to bridge the gap between
rival ideologies. Publicly, though, the party tamped down
dissent and argued that capitalism was one more sign of
socialist progress (Kahn, 2002). Most knew the party was on the
road to perdition, but the system obscured that reality.
Several perspectives on organizational learning are exemplified
in the work of Peter Senge (1990), Barry Oshry (1995), and
Chris Argyris and Donald Schön (1978, 1996). Senge sees a

core learning dilemma: “We learn best from our experience, but
we never directly experience the consequences of many of our
decisions” (p. 23). Learning is relatively easy when the link
between cause and effect is clear. But complex systems often
sever that connection: causes remote from effects, solutions
detached from problems, and feedback delayed or misleading
(Cyert and March, 1963; Senge, 1990). At home, you flip a
switch and the light goes on. In an organization, you flip the
switch and nothing happens—or a toilet may flush in a distant
building. You are still in the dark, and the user of the toilet is
unpleasantly surprised. To understand what is going on, you
need to master the system's circular causality.
Senge emphasizes the value of “system maps” that clarify how a
system works. Consider the system created by “Chainsaw Al”
Dunlap, CEO of Scott Paper in the early 1990s. Dunlap was
proud of his nickname and his turnaround at Scott. He raised
profits and market value substantially by slashing head count
and cutting frills such as research and development. But he
rarely acknowledged Scott's steady loss of market share (Byrne,
1996). It is one of many examples of actions that look good
until long-term costs become apparent. A corresponding systems
model might look like Exhibit 2.2. The strategy might be
cutting training to improve short-term profitability, drinking
martinis to relieve stress, offering rebates to entice customers,
or borrowing from a loan shark to cover gambling debts. In each

case, what seems to work in the moment creates long-term costs
down the line.
Exhibit 2.2. Systems Model with Delay.
Oshry (1995) agrees that system blindness is widespread but
highlights causes rooted in troubled relationships between
groups that have little grasp of what's above or below their
level. Top managers feel overwhelmed by complexity,
responsibility, and overwork. They are chronically dissatisfied
with subordinates’ lack of initiative and creativity. Middle
managers, meanwhile, feel trapped between contradictory
signals and pressures. The top tells them to take risks but then
punishes mistakes. Their subordinates expect them to shape up
the boss and improve working conditions. Top and bottom tug
in opposite directions, causing those in between to feel pulled
apart, confused, and weak. At the bottom, workers feel helpless,
unacknowledged, and demoralized. “They give us lousy jobs
and pay, and order us around—never telling us what's really
going on. Then they wonder why we don't love our work.” If
you cannot step back and see how system dynamics create these
patterns, you muddle along blindly, unaware of better options.
Both Oshry and Senge argue that our failure to read system
dynamics traps us in a cycle of blaming and self-defense.
Problems are always caused by someone else. Unlike Senge,
who sees gaps between cause and effect as primary barriers to

learning, Argyris and Schön (1978, 1996) emphasize
individuals’ fears and defenses. As a result, “the actions we
take to promote productive organizational learning actually
inhibit deeper learning” (1996, p. 281).
According to Argyris and Schön, our behavior obstructs
learning because we avoid undiscussable issues and tiptoe
around organizational taboos. Our actions often seem to work in
the short run because we avoid conflict and discomfort, but we
create a double bind. We can't solve problems without dealing
with problems we have tried to hide, but tackling them would
expose our cover-up. Facing that double bind, Helen Demarco
and her colleagues chose to disguise their scheme. The end
result is escalating games of sham and deception. This is what
happened at Enron, where desperate maneuvers to obscure the
truth made the day of reckoning more catastrophic.
COPING WITH AMBIGUITY AND COMPLEXITY
Organizations deal with a complicated and uncertain
environment by trying to make it simpler. One approach to
simplification is to develop better systems and technology to
collect and process information. Another is to break complex
issues into smaller chunks and assign slices to specialized
individuals or units. Still another approach is to hire or develop
professionals with sophisticated expertise in handling thorny
problems. These and other methods are helpful but not always
sufficient. Despite the best efforts, unanticipated—and

sometimes appalling—events still happen. The key in dealing
with these events is developing better mental maps to anticipate
complicated and unforeseeable problems.
You See What You Expect
On April 14, 1994, three years after the first Gulf War ended,
two U.S. F-15C fighter jets took off from a base in Turkey to
patrol the no-fly zone in northern Iraq. Their mission was to
“clear the area of any hostile aircraft” (Snook, 2000, p. 4). The
zone had not been violated in more than two years, but Iraqi
antiaircraft fire was a continuing risk, and the media speculated
that Saddam Hussein might be moving a large force north. At
10:22 am, the fighter pilots reported to AWACS (Airborne
Warning and Control System) controllers that they had made
radar contact with two slow, low-flying aircraft. Unable to
identify the aircraft electronically, the pilots descended for
visual identification. The lead pilot, Tiger 01, spotted two
“Hinds”—Soviet-made helicopters used by the Iraqis. He
reported his sighting, and an AWACS controller responded,
“Copy, 2 Hinds” (p. 6). The fighters circled back to begin a
firing run. They informed AWACS they were “engaged,” and, at
10:30 am, shot down the two helicopters.
Destroying enemy aircraft is the fighter pilots’ grail. Only later
did the two learn that they had destroyed two American UH-60
Black Hawk helicopters, killing all twenty-six U.N. relief
workers aboard. How could experienced, highly trained pilots

make such an error? Snook (2000) offers a compelling
explanation. The two types of aircraft had different paint
colors—Hinds tan, Black Hawks forest green—and the Black
Hawks had American flags painted on the fuselage. But the
Black Hawks’ camouflage made them difficult to see against the
terrain, particularly for fighters flying very fast at high
altitudes. Visual identification required flying at a dangerously
low altitude in a mountain-walled valley. The fighter pilots
were eager to get above the mountains as quickly as possible.
An extensive postmortem confirmed that the Black Hawks
would have been difficult to identify. The pilots did the normal
human thing in the face of ambiguous perceptual data: they
filled in gaps based on what they knew, what they expected, and
what they wanted to see. “By the time Tiger 01 saw the
helicopters, he already believed that they were enemy. All that
remained was for him to selectively match up incoming scraps
of visual data with a reasonable cognitive scheme of an enemy
silhouette” (p. 80).
Recall that in Chapter One, we described the “blink” process of
rapid cognition. The essence of this process is matching
situational cues with a well-learned mental model—a “deeply-
held, nonconscious category or pattern” (Dane and Pratt, 2007,
p. 37). While necessary and useful, quick judgments are not
foolproof. Their accuracy depends on available clues,
expectations, and patterns in the decision maker's repertory. All

of these presented problems for the fighter pilots. The
perceptual data were hard to read, and expectations were
prejudiced by a key missing clue—no mention of friendly
helicopters. Even though situation analysis plays a pivotal role
in their training, pilots lacked adequate diagnostic schemata for
distinguishing Hinds from Black Hawks. All this made it easy
for them to conclude that they were seeing enemy aircraft.
Making Sense of What's Going On
Some events are so clear and unambiguous that it is easy for
people to agree on what is going on. Determining if a train is on
schedule, if a plane landed safely, or if a clock is keeping
accurate time is straightforward. But most of the important
issues confronting managers are not so clear-cut. Solid facts and
simple problems in everyday life at work are scarce. Will a
reorganization work? Was a meeting successful? Why did a
consensual decision backfire? In trying to make sense of
complicated and ambiguous situations, we—like the F-15C
fighter pilots—depend very much on our frames, or mind-sets,
to give us a full reading of what we are up against. But snap
judgments work only if we have adequately sized up the
situation.
Since our interpretations depend so much on our cognitive
repertoires, expectations, beliefs, and values, our internal world
is as important as what is outside—sometimes more so. The
fuzziness of everyday life makes it easy for people to shape the

world to conform to their favored internal schemata. As noted
by DeBecker, “Many experts lose the creativity and imagination
of the less informed. They are so intimately familiar with
known patterns that they may fail to recognize or respect the
importance of a new wrinkle” (1997, p. 30). In such cases, snap
judgments work against, rather than for, the person who is
trying to figure things out.
Managers regularly face an unending barrage of puzzles or
“messes.” To act without creating more trouble, they must first
grasp an accurate picture of what is happening. Then they must
move quickly to a deeper level, asking, “What is really going on
here?” That's the main objective of teaching pilots the art of
situational analysis. But this important step in reading a
situation is often overlooked. As a result, managers too often
form superficial analyses and leap on the solutions nearest at
hand or most in vogue. Market share declining? Try strategic
planning. Customer complaints? Put in a quality program.
Profits down? Time to reengineer or downsize.
A better alternative is to think, to probe more deeply into what
is really going on, and to develop an accurate diagnosis. The
process is more intuitive than analytic: “[It] is in fact a
cognitive process, faster than we recognize and far different
from the step-by-step thinking we rely on so willingly. We think
conscious thought is somehow better, when in fact, intuition is
soaring flight compared to the plodding of logic” (DeBecker,

1997, p. 28). The ability to size up a situation quickly is at the
heart of leadership. Admiral Carlisle Trost, former chief of
naval operations, once remarked, “The first responsibility of a
leader is to figure out what is going on.… That is never easy to
do because situations are rarely black or white, they are a pale
shade of gray… they are seldom neatly packaged.”
It all adds up to a simple truth that is easy to overlook. The
world we perceive is, for the most part, constructed internally.
The ideas, or theories, we hold determine whether a given
situation is foggy or clear, mildly interesting or momentous, a
paralyzing disaster or a genuine learning experience. Personal
theories are essential because of a basic fact about human
perception: in any situation, there is simply too much happening
for us to attend to everything. To help us understand what is
going on and what to do next, well-grounded, deeply ingrained
personal theories offer two advantages: they tell us what is
important and what can be safely ignored, and they group
scattered bits of information into manageable patterns.
The Dilemma of Changing or Conserving
To a nonpilot, a commercial airliner's cockpit is a confusing
array of controls, switches, and gauges. Yet an experienced
pilot can discern the aircraft's status at a glance. Like other
professionals, a pilot learns patterns that cluster seemingly
fragmented bits of information into a clear picture. The patterns
take many hours to learn, but once learned, they help the pilot

size things up with ease, speed, and accuracy. In the same way,
an experienced manager can read a situation very rapidly,
decide what needs to be done, and make it happen.
The good and bad news is that, right or wrong, our theories
shield us from confusion, uncertainty, and anxiety. Tiger 01, for
example, knew exactly what to do because he believed what he
saw. We rely on the theories we have, and, in the heat of the
moment, it's not easy to recognize when we are making a big
mistake if we feel confident in our judgment. But, as Gladwell
writes: “Our snap judgments and first impressions can be
educated and controlled” to shift the odds in our favor (2005, p.
15).
This learning needs to happen before we find ourselves in make-
or-break situations. When the stakes are high, we have tried
every lens we know, and nothing works, we get anxious and
stuck. We are caught in a dilemma: holding on to old patterns is
ineffective, but developing new mental models is difficult. It is
also risky; it might lead to analysis paralysis and further erosion
of our confidence and effectiveness.
This dilemma exists even if we see no flaws in our current
mind-set, because our theories are self-sealing filters—they
block us from recognizing our errors. Extensive research
documents the many ways in which individuals spin reality to
protect existing beliefs (see, for example, Garland, 1990;
Kühberger, 1995; Staw and Hoang, 1995). This helps to explain

why Enron's Ken Lay insisted he had done the right thing, even
though his company collapsed. Heath and Gonzalez (1995)
found that decision makers rely on others more to strengthen
preconceived thinking than to gain new information. Tetlock
(2000) showed that managers’ judgments of performance were
influenced by cognitive preferences and political ideologies.
Extensive research on the “framing effect” (Kahneman and
Tversky, 1979) shows how powerful subtle cues can be.
Relatively modest changes in how a problem or decision is
framed can have a dramatic impact on how people respond (Shu
and Adams, 1995; Gegerenzer, Hoffrage, and Kleinbölting,
1991). Decision makers, for example, tend to respond more
favorably to an option that has a “70 percent chance of success”
than one that has a “30 percent chance of failure,” even though
they are statistically identical.
Many of us recognize that our mental maps influence how we
interpret the world. Less widely understood is that what we
expect often determines what we get. Rosenthal and Jacobson
(1968) studied schoolteachers who were told that certain
students in their classes were “spurters”—students who were
“about to bloom.” The so-called spurters had been randomly
selected but still achieved above-average gains on achievement
tests. They really did spurt. Somehow the teachers’ expectations
were communicated to and assimilated by the students. Modern
medical science is still trying to understand the power of the

placebo effect—the power of sugar pills to make people better.
Results are attributed to an unexplained change in the patient's
belief system. Patients believe they will get better; therefore
they do. Similar effects have been replicated in countless
reorganizations, new product launches, and new approaches to
performance appraisal. All these examples show how hard it is
to disentangle the reality out there from the models in our
minds.2
In Western cultures, particularly, there is a tendency to embrace
one theory or ideology and to try to make the world conform. If
it works, we persist in our view. If discrepancies arise, we try to
rationalize them away. If people challenge our view, we ignore
them or put them in their place. Only poor results over a long
period of time call our theories into question. Even then, we
often simply entrench ourselves in a new worldview, triggering
the cycle again.
Japan has four major religions, each with unique beliefs and
assumptions: Buddhism, Confucianism, Shintoism, and Taoism.
Though the religions differ greatly in history, traditions, and
basic tenets, many Japanese feel no need to choose only one.
They use all four, taking advantage of the strengths of each for
suitable purposes or occasions. The four frames can play a
similar role for managers in modern organizations. Rather than
portraying the field of organizational theory as fragmented, we
present it as pluralistic. Seen this way, the field offers a rich

assortment of lenses for viewing organizations. Each theoretical
tradition is helpful. Each has blind spots. Each tells its own
story about organizations. The ability to shift nimbly from one
to another helps redefine situations so they become
understandable and manageable. The ability to reframe is one of
the most powerful capacities of great artists. It can be equally
powerful for managers. Undergraduates at Vanderbilt University
captured this in a class-initiated rap (for best results, rap fans
might imagine the rapper Common doing these lines in a neo-
soul, hip-hop style):
Reframe, reframe, put a new spin on the mess you're in.
Reframe, reframe, try to play a different game.
Reframe, reframe, when you're in a tangle, shoot another angle;
look at things a different way.
SUMMARY
Because organizations are complex, surprising, deceptive, and
ambiguous, they are formidably difficult to comprehend and
manage. Our preconceived theories and images determine what
we see, what we do, and how we judge what we accomplish.
Narrow, oversimplified perspectives become fallacies that cloud
rather than illuminate managerial action. The world of most
managers and administrators is a world of messes: complexity,
ambiguity, value dilemmas, political pressures, and multiple
constituencies. For managers whose images blind them to
important parts of this chaotic reality, it is a world of

frustration and failure. For those with better theories and the
intuitive capacity to use them with skill and grace, it is a world
of excitement and possibility. A mess can be defined as both a
troublesome situation and a group of people who eat together.
The core challenge of leadership is to move an organization
from the former to something more like the latter.
In succeeding chapters, we look at four perspectives, or frames,
that have helped managers and leaders find clarity and meaning
amid the confusion of organizational life. The frames are
grounded in cool-headed management science and tempered by
the heat of actual practice. We cannot guarantee your success as
a manager or a change agent. We believe, though, that you can
improve your odds with an artful appreciation of how to use the
four lenses to understand and influence what's really going on.
NOTES
1.We used citation analysis (how often a work is referenced in
the scholarly literature) to develop a list of “scholars’ greatest
hits”—the works that organizational scholars rely on most. The
Appendix shows our results and discusses how we developed
our analysis. At appropriate points in the book (where the ideas
are most relevant, as here), we present a brief summary of key
ideas from works at the top of our list.
2.These examples all show thinking influencing reality. A social
constructivist perspective goes a step further to say that our
thinking constructs social reality. In this view, an organization

exists not “out there” but in the minds and actions of its
constituents. This idea is illustrated in an old story about a
dispute among three baseball umpires. The first says, “Some's
balls, and some's strikes, and I calls 'em like they are.” The
second counters, “No, you got it wrong. Some's balls, and
some's strikes, and I calls 'em the way I sees them.” The third
says, “You guys don't really get it. Some's balls, and some's
strikes, but they ain't nothing until I call them.” The first
umpire is a realist who believes that what he sees is exactly
what is. The second recognizes that reality is influenced by his
own perception. The third is the social constructivist—his call
makes them what they are. This distinction is particularly
important in the symbolic frame, which we return to in Chapter
Twelve.
(Bolman 23)
Bolman, Lee G., Terrence E. Deal. Reframing Organizations:
Artistry, Choice, and Leadership, 4th Edition, 4th Edition. John
Wiley & Sons P&T, 11/2007.
<vbk:9781118178102#outline(2)>.

Unit 1 Module 1 - Virtues and Drawbacks of Organized Activity.docx

More Related Content

Similar to Unit 1 Module 1 - Virtues and Drawbacks of Organized Activity.docx (20)

More from willcoxjanay (20)

Recently uploaded (20)

Unit 1 Module 1 - Virtues and Drawbacks of Organized Activity.docx