In Business Doing It Wrong

It is always exciting to meet a real subversive, especially when he (or she) is old and wise. This In Business is a special tribute to a veteran management expert who died in October 2009.

I met Russell Ackoff some three years ago when he was in London to launch a new book at the age of 88. And he simply bubbled with ideas about what's wrong with the way business works. The book was all about the so-called "F-Laws", of flaws ... uncomfortable truths about the (mistaken) way most organisations are run.

He told me: "Companies and organisations get things wrong most of the time." The average life of a US corporation is only 11-and-a-half years, the rate of bankruptcy is increasing very year. There's a great deal of evidence that we don't know how to manage organisations very effectively.

Russell Ackoff started academic life as a specialist in operational research. The important switch in his own life occurred with the rise of systems thinking in the 1970s.

As he puts it, corporate problems were arising that could not be solved by simply taking care of the parts, the obsession of operational research. "We found that we could improve part of a corporation and destroy the whole by improving the part."

Complexity

Russell Ackoff thought that, imprisoned in centuries of Western education which values only analytic thought, most people cannot do the "synthetic" thinking that sees an organisation as an intermoving whole.

This important insight may have sprung from his upbringing. Russell Ackoff trained as an architect, not at a business school. Architects have to start with the concept of the buildings as a whole - they don't start with the details, he told me. Complexity is not a problem to the architect, but it is to the analyst.

As organisations have evolved since the supremacy of Henry Ford's moving production line, the critical things in corporations has become the interaction of interdependent parts. And few, says Professor Ackoff, have much idea how to do it.

There was also something else he told me in that memorable tutorial three years ago. Russ Ackoff taught for many years at the very highly regarded Wharton Business School in Philadelphia, but he was deeply suspicious about what people learnt at such places.

Interact

Business schools are behind even corporate practice, said the Professor. They are a major obstruction. Business schools continue to teach everything in separate parts rather than learning how marketing or production interact, he argued.

When he retired from the Wharton School in 1986, Professor Ackoff wickedly identified three contributions of a business school education:

– It gives students a vocabulary that enables them to speak with authority on things they do not understand.

– It gives them a set of operating principles that enable them to withstand any amount of disconfirming evidence.

– It gives them a ticket to a job where they the can learn something about management.

In a world of high sounding qualifications, Professor Russell Ackoff was a genuine subversive.

He was not one of the great headline making gurus. Like his admirer the great Peter Drucker he rejected that term for himself. But businesses - and many other organisations - still have lots to learn from Russell Ackoff.

Professor Ackoff's book "Management F-Laws: how organisations really work", with Herbert Addison and Sally Bibb, is published by Triarchy Press.

Listen to Doing It Wrong (14/01/2010)

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For more programmes visit the In Business programme archive.

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