On cargo cult management

Alastair Cook and those calling for Ed Miliband to be bold and transformational have something in common. Both are practicing what I've called cargo cult management.

What I mean by this is a focus upon ritualistic aspects of "leadership" whilst neglecting the question of how exactly the rituals are related to outcomes.

For example, Cook says it took a lot of guts to sack Kevin Pietersen. But who cares? What matters is whether the decision was right. And given England's shambolic showing the World Twenty20, this is questionable.

Demands for Miliband to show "boldness" display a similar fetish of courageous leadership to the neglect of outcomes. What matters isn't whether policies are bold or not, but whether they are right. By all means argue for (say) a looser fiscal policy or higher minimum wage, but demanding boldness as a good in itself is just silly: in this sense, I'm with Hopi. Boldness, bravery and guts can easily become recklessness, and cowardice can be prudence. I'd rather decisions were cowardly but right than bold but wrong.

But it's not just Cook and the Labour left that seem to be guilty of cargo cult management. John Kay today reminds us of how New Labour was too, in believing that ritualistically declaiming worthy objectives was somehow sufficient:

The 2008 Climate Change Act supposedly sets a “legally binding” obligation to reduce greenhouse gas emissions by 80 per cent by 2050. The 2010 Child Poverty Act requires that child poverty be eliminated by 2020. Neither piece of legislation makes provision for how these outcomes will be achieved.

The Tories have been guilty of the same thing. For all Osborne's talk about tough policies to reduce government borrowing, this is much higher than either he or Alistair Darling envisaged back in 2010. Any schoolboy Keynesian could tell you why; policies that depress GDP also depress tax revenues.

And whilst the bedroom tax was supposed to be "tough", it has not had the desired effect of forcing people into smaller accommodation but has instead merely forced them into rent arrears. The bedroom tax should be renamed the Wonga subsidy.

In this fetishization of toughness and boldness, politicians are borrowing their ideas from the worst of corporate management. Back in the 1990s, "Chainsaw" Al Dunlap earned a reputation for a tough-minded focus on shareholder value by sacking thousands of workers. But when he joined Sunbeam, this strategy failed, and it transpired that he was merely cooking the books. Sunbeam went bust, and Dunlap has been disqualified from being a company director.

This sort of silly thinking has also infected ordinary people (very ordinary ones). On Sunday, S***s fans got the hump at Tim Sherwood sitting the stands rather than standing on the touchline - without asking how being a few yards nearer the pitch would enable him to achieve the impossible feat of polishing a turd.

In all these cases, there's a common theme. It's a version of the representativeness heuristic - an unthinking belief that causes will resemble outcomes. The Labour left think bold talk will lead easily to better conditions for workers, just as Osborne thought "tough decisions" would reduce the deficit and Dunlap thought cutting costs would raise profits. In a complex world with massive uncertainty and multiple feedback mechanisms, however, the link between macho leadership and actual outcomes is not so simple. As John Kay has so wisely said, sometimes our aims are better achieved obliquely.  

Comments

[Martyn]

If all the climate change act did was set a distant target it would be rather pointless - we had those before and they were usually missed as they were NIMTO targets - Not In My Term of Office.

In fact the bulk of the Act (i.e. everything after Clause 1 - which sets that target) ets out a process by which a "safe" levels of carbon emissions for the UK in every five year period up to 2050 are assessed. It also shows sets out how Governments must monitor emissions, in order that all Governments are held to account for their success or otherwise in cutting emissions.

[Clive]

To be fair to Al Dunlap, he has been suggested that he is a psychopath.

I wonder how Osbourne and Miliband score on the Hare Psychopathy Checklist

[Luke]

Alistair Cook is too young to remember Yes, Minister. From memory "that's a brave decision, Minister " means "that's a lunatic idea, and when it fails, which it undoubtedly will, I will distance myself from it and make it quite clear that we told you it was stupid."

I admit I was one of those who thought Sir Humphrey was a truly heroic figure, and not the comic anti-hero some considered him.

[Keith]

" And whilst the bedroom tax was supposed to be "tough", it has not had the desired effect of forcing people into smaller accommodation but has instead merely forced them into rent arrears. The bedroom tax should be renamed the Wonga subsidy."

I agree. But this should have been obvious to any sensible person. The merits of policy decide if they work not how many times they are described as conforming to some list of irrelevant emotive list of words.

The cabinets policies clearly never had the goal of reducing the fiscal deficit as they are full of holes designed to boost profits of private firms. The voters and journalists are mugs for this game.

[breviosity]

Yes, it is irrational to want so much 'bold leadership'. Why, though, do so many people desire it?

Partly it is boredom. We live at the End of History in which there are no more world wars and few grand ideological contests. So, pundits especially want to see a bit of lively action.

Partly also it is that humans on average naturally desire leadership. Probably this sentiment was adaptive in prehistory.

So, it is not a new ideology that has recently 'infected' ordinary football fans. It's an inbuilt preference that has always been there.

[gastro george]

"Tough leadership" is rather compromised by the cliche that is a politician saying "we have to take tough decisions". Meaning making a really easy decision that the politician really likes, but everybody involved is going to hate, usually quite justifiably.

[aragon]

People want bold changes because they are dissatisfied with the status quo.

Let's argue about Michael Gove been on the naughty step in the Budget response, after all this non-event budget did contain changes beyond the penny off beer.

We want more than the crude popular and sectional but nonsensical policies of George Osborne, like 'Right to Buy' and the me too neoliberalism of the two Ed's, whose ambition is to match George Osborne plans.

It is not fetishness, we want change, something no politicians deliver!

If policies are trivial it doesn't matter if they asre right or wrong, as the consequences are inconsequential.

Michael Gove is on the naughty step ... who cares? apart from Ed.

A difference without a distinction is a pointless choice, Tory or Labour the results is the same.

Ideas and ideology have gone the way of the Dodo!

[Blissex]

«cargo cult management.

What I mean by this is a focus upon ritualistic aspects of "leadership" whilst neglecting the question of how exactly the rituals are related to outcomes.»

Probably our blogger is well aware of what in the tech industry is called the "pants gnome business plan":

http://en.wikipedia.org/wiki/Gnomes_%28South_Park%29#Plot

[Blissex]

«And whilst the bedroom tax was supposed to be "tough", it has not had the desired effect of forcing people into smaller accommodation»

I object strongly to the belief that the policy was proposed because of that desire. What desire the tories had is purely in their mind.

The most obvious guess for the purpose of the policy is that it was designed to suggest that people on benefits are often enough living in luxury wasting huge amounts of rent benefit on large half-unoccupied mansions, while the middle-income class work hard to pay for living cramped in tiny modern houses.

Just like the policy to cap all benefits at average family income was designed to suggest that people on benefits are often enough pulling in huge money for doing nothing, while the middle-income class work hard to get less money.

The general logic is to boost the attitude described in one of my usual quotes, from The Times, 2011-09-17, by Janice Turner:

«The C2 women who voted Conservative last time did so because they, in low to middling-paid roles such as nurses, secretaries and carers, believed welfare had grown too generous, that benefits rewarded the do-nothings while they toiled. They hoped the Tories would crack down.»

While both policies involve relatively few people or little money or cases where there are good reasons.

In particular the impact of the bedroom tax falls mostly on areas where population density is low and/or housing is cheap, see map is slide 23 in:

http://www.cpes.org.uk/dev/wp-content/uploads/2013/08/5-fothergill-Welfare-reform-Cambridge-talk.pdf

The other maps show the impact of other bits of government's tight fiscal policy.

The maps showing the impact of government's loose credit policy would be the complement...

[rogerh]

Strange that govt policies are so obviously unworkable, perhaps we see a triumph of rhetoric over logic. Take last night's Farage debate, Farage 'won', but won what? Surely few think he makes any sense or has workable policies. Yet rhetoric is the preferred tool in parliament.

Then there are the holy cows - today more education is the nostrum, infants to start at 2. What is this all about - I really doubt a few more GCSEs are going to push up GDP very much. Is it really a ruse to get more mummies into work or to get infants away from dis-functional homes or is it just 'more is better'.

Parliament seems painted into a tight corner unable to do much useful. A corporate in this position would seek to break out or to cut back layers of management fat. But parliament can do neither, nowhere to go and each layer props up the edifice. Cut one layer and the support structure collapses, so keep on with the same useless rituals.

[Blissex]

«Is it really a ruse to get more mummies into work or to get infants away from dis-functional homes or is it just 'more is better'.»

All these talking points get designed and tested by cunning consultants...

One of the advantages of the "education" talking point is that i suggests that if someone is poor or unemployed it is their fault because they must be uneducated. The "education" talking point then matches nicely the "skills shortage" talking point that employer always, always shout, even when there are 10 unemployed people with qualification for each vacancy.

The talking points work in large part because of one of the cognitive biases our blogger often mentions, that frequency of hearing a statement is taken as a proxy for its truth.

But "education" as a talking point has another two huge advantages:

* Since the recession began in the 1980s, governments have had the problem of hiding the lack of employment opportunities. One way has been to narrow down the definition of unemployment, another has been to boost the number of people underemployed. People in "education" don't count as unemployed. So for example the colossal expansion of postgraduate places in the 1980s, stopping counting as unemployed students looking for work during the summer, luring or pushing ever larger percentages of young people into thinly funded degree mills.

* The other advantage of "education" is that it boosts demand and employment. Not only someone who would otherwise be unemployed disappears from the statistics by becoming a student, they also pay to employ lecturers and staff. Since the reforms that make the cost of higher education nominally fall directly on students, by loading them with debt, this has become a double win for the government.

In the above "the government" have been of both parties, because the problems caused by the never ending recession started in the 1980s are independent of which party is in power, and the numerous cognitive biases (a euphemism perhaps for pigheaded meanness) of voters mean that plain talking with them would be disastrous.

[Ralph Musgrave]

Two more meaningless PC words used by the political left: "progressive" and "radical".

[julian]

@Clive

It has become apparent that many leading businesspeople are sociopaths (far exceeding the around 4% in the general population)

http://www.psychologytoday.com/blog/digital-leaders/201309/are-you-working-sociopath

I have long wondered whether the population in the political world and parliament in particular is high. Nobody's tried to investigate this afaik but in my view being a politician is the ideal career for a sociopath. And sociopaths have very strange ideas about objectives as their goals are soley selfish, however cloaked in nice language.