Far too many business concepts, frameworks and case studies are the product of flawed research, careless misappropriation, or naivety. Take the famous Hawthorne Effect, named after a landmark set of studies from the 1920s at Western Electric’s Hawthorne plant in Cicero, Illinois. Among the most influential experiments in social science, these studies helped spawn the field of industrial psychology. The Hawthorne Effect states that changes in light intensity, even those that make a room dimmer, increase employee productivity by up to 10%. The profound implication for managers was “that it is attention to employees, not work conditions per se, that has the dominant impact on productivity” – except that in 2009, two University of Chicago economists, Steven Levitt (of Freakonomics fame) and John List, assessed the original research and found that these remarkable data patterns were entirely fictional. In other words, there is no Hawthorne effect.
Similarly, management consultants habitually apply the Swiss-American psychologist Elisabeth Kubler-Ross’s theory of the five stages of grief (denial, anger, bargaining, depression and acceptance) to help clients understand how employees experience major changes in the workplace. This could be extremely valuable for executives in charge of large-scale management initiatives – except that Kubler-Ross’s theory was based on interviews with terminally ill patients, rather than workers facing, say, the loss of their coffee breaks. In fact, an extensive longitudinal study found that denial is not the first stage of grief and that the dominant grief indicator is actually yearning, which isn’t one of Kubler-Ross’s five stages at all. In other words, applying Kubler-Ross’s theory to change management is a spurious effort.
[An interesting follow-on: Kubler-Ross’s reputation declined after she expanded her research to near-death experiences and spirit mediums. She held seances (in the complete dark) with Jay Barham, a perverted “psychic” who, stark naked, would molest female participants while pretending to be an “afterlife entity.” In 1995, her Virginia farmhouse burnt down under suspicious circumstances and she suffered the first of a series of strokes. In a final interview with Oprah Winfrey, she described her feelings about her own impending death as “just angry, angry, angry.”]
The British government commissioned a classic example of a misleading case study to explain why Japanese firms, especially Honda, so dramatically outsold British motorcycles in the United States. The consultants described how Honda, leveraging its low-cost, high-volume production base in Japan, secured entry into the US market by developing a brand-new market sector – the sale of small motorcycles to middle-class consumers. This textbook example of analytical virtuosity and strategic cunning became the basis of case studies in business schools worldwide; that is, until management scholar Richard Pascale flew to Japan and interviewed the responsible managers. There was no brilliant plan, they admitted; instead, they had slowly stumbled, through lots of trial and even more error, onto an “emergent strategy” that eventually proved successful. “In truth,” he was told, “we had no strategy other than the idea of seeing if we could sell something in the United States.” Even the famous US advertising campaign – “You meet the nicest people on a Honda” – wasn’t the product of Honda’s exemplary strategic thinking. It was coined by a UCLA undergraduate for a class project.
Sources
Boston Consulting Group, Strategy Alternatives for the British Motorcycle Industry, Her Majesty’s Stationery Office, 1975.
Burns L, Elisabeth Kubler-Ross: The rise and fall of the five stages of grief, BBC News, 3 July 2020.
Kubler-Ross E, On Death & Dying, Scribner, 1969.
Levitt S and J List, Was There Really a Hawthorne Effect at the Hawthorne Plant? An Analysis of the Original Illumination Experiments, NBER Working Paper 15016, 2009.
Maciejewski P et al, An Empirical Examination of the Stage Theory of Grief, Journal of the American Medical Association, Vol 297 No. 7, 2007.
Mintzberg H, B Ahlstrand and J Lamper, Strategy Safari, Prentice Hall Europe, 1998.
Pascale R, Perspectives on Strategy: The Real Story Behind Honda’s Success, California Management Review, Spring 1984.
Waterman RH and T Peters, In Search of Excellence, Harper & Row, 1982.