It can often be difficult to tell whether your regular contacts within large organisations are truly speaking on behalf of their Board or other senior staff. Senior executives, senior partners, senior aircraft and ship captains, hospital consultants etc. are so powerful that they easily become isolated from ordinary people, and even more so from their front line staff and their concerns.
Some of them overcome the problem better than others. Crew Resource Management, mandatory protocols and generational change are making a big difference in hospitals and transport. But many other top executives have too much confidence in their own judgement and opinions, whilst the scale of their operations or responsibilities mean that they have to think in abstract terms where risks, and even death rates, become mere numbers that have to be managed. This can easily cause whole management teams to characterise as naive or unworldly anyone - and in particular a whistle blower or journalist - who expresses any concern about organisational culture. Lord Browne, BP's Chief Exec at the time of the Texas City disaster, was said by his executive assistant to show 'no passion, no curiosity [and] no interest' in safety.
It can be worse if an organisation is highly focused on the power and influence of a single individual, often someone with a heroic leadership style. Their direct reports then spend all their time trying to second guess their hero's wishes, rather than think for themselves or commission analysis which might challenge their leader's views. This was certainly a problem at Toshiba where investigators into a huge accounting scandal found "a corporate culture where it was impossible to go against one's bosses' wishes".
The wider the power gap, the more difficult it can be to communicate even urgent concerns. Junior doctor Rachel Clarke* describes her distress when she failed to challenge the appalling behaviour of one senior consultant doctor.
Mr Skipton ... stared up in trepidation as my boss, impatient to get to theatre as quickly as possible, alighted at the bedside. ... Without so much as an introduction, he broke the news to the patient of his terminal illness by turning away to the bedside entourage and muttering, perfectly audibly, "Get a palliative care nurse to come and see him". No one had even told 'him' he had cancer.
As panic began to rise in Mr Skipton's face, I remember catching the ward sister's eye to see her cringing alongside me. But trying to undo the damage would take so long and the ward round was already sweeping on. I had a moment to act decisively. I could have chosen to earn my consultant's wrath by remaining at my patient's bedside. Instead, to my shame, I scuttled dutifully after my boss, leaving someone else to pick up the pieces.
(*The above extracts are from Rachel's book Your Life in My Hands.)
Even if middle managers (the agents) are trying hard to achieve the aims set for them by their seniors (their principals), it is absolutely certain that their communications to their seniors will be less than totally honest or frank. Tim Harford puts in nicely in his book Adapt:
'There is a limit to how much honest feedback most leaders really want to hear; and, because we know this, most of us sugar-coat our opinions whenever we speak to a powerful person. In a deep hierarchy, that process is repeated many times, until the truth is utterly concealed inside a thick layer of sweet-talk. There is some evidence that the more ambitious a person is, the more he will choose to be a yes-man - and with good reason because yes-men tend to be rewarded.
Even when leaders and managers genuinely want honest feedback, they may not receive it. At every stage in a plan, junior managers or petty bureaucrats must tell their superiors what resources they need and what they propose to do with them. There are a number of plausible lies they might choose to tell, including over-promising in the hope of winning influence as go-getters, or stressing the impossibility of a task and the vast resources needed to deliver success, in the hope of providing a pleasant surprise. Actually telling the unvarnished truth is unlikely to be the best strategy in a bureaucratic hierarchy. Even if someone does tell the truth, how is the senior decision-maker the honest opinion from some cynical protestation?
At another level, the behaviour of large companies' senior executives has become quite fascinating. One begins to wonder whether big business has succeeded warfare as the most exciting form of competition between human organisations. Some modern boardrooms appear to attract those who would, in previous generations, have sought to command large armies. Instead of invasions, we nowadays have corporate takeovers; instead of gold braid and military honours, we have executive salaries. The leading actors therefore remain the odd combination of hugely ambitious, sometimes inspirational, but too often also highly self-absorbed and disastrously inept. For Haig, Montgomery, Patton and MacArthur substitute Dick Fuld, Fred Goodwin, John Gutfreund, Tony Hayward, Jeffrey Skilling, Bob Diamond, Rajat Gupta? Indeed, I understand that Turkish Islamists rather bitterly note that the mujahids or aspiring warriors of old have become the muteahhits or construction tycoons of today.
It certainly seems to be the case that power changes the behaviour of previously decent men and women. 'Power corrupts ... etc.'. It is perhaps inevitable that powerful CEOs' sense of right and wrong becomes aligned with the norms and expectations of others who are similarly rich and powerful. Neuroscientist and psychologist Ian Robertson goes further and draws attention to research which shows that power increases testosterone levels which in turn increases the uptake of dopamine in the brain, leading to increased egocentricity and reduced empathy (New Scientist 7 July 2012). Power also reduces anxiety and increases appetite for risk.
And yet, as the FT's Lucy Kellaway points out: "Modern CEOs seem to have no [public] opinions, especially not negative ones. If they feel one coming on, they have been trained by their lawyers and PR advisers to suppress it." It is certainly difficult these days for CEOs to correct the mistakes or improve the behaviour of their organisation without laying themselves open to the charge that previous behaviour was in some sense faulty and so worthy of criticism and/or claims for compensation.
Senior managers are certainly, all too often, very concerned to appear infallible (and un-sue-able). Organisations therefore get locked into defensive modes, from which they find it increasingly difficult to extricate themselves - and so the problems get worse. The reputation of BP's Tony Hayward was for instance badly damaged (yet further) when he failed to answer many of the questions put to him by US Congressmen in June 2010. Barclays' Bob Diamond also did himself no favours when responding so blandly to UK politicians' questions in July 2012.