I was reading through an old but still spot-on book by my friend and co-author Jeff Pfeffer, The Human Equation, which provides an evidence-based case about why companies that put people first enjoy superior financial performance over the long-run. Jeff makes an argument that is a variation of something one of my college friends used to say, "eat shit, 10 billion flies can't be wrong." But he adds prestige and status as an added twist in a section he labels "Perverse Norms about What Constitutes Good Management," and how such norms often emerge even though they conflict with the evidence. He uses the example of layoffs — which are no doubt sometimes necessary. But executives often seem to act in ways that clash with evidence showing that companies that do layoffs last and least tend to perform best over time:
" If the world believes that laying-off employees by the carload is good management and confers status on those that do it with the most vigor, it will be difficult for executives to resist the temptation to conform to the normative definition of "good management" and thereby achieve approval."
As usual, Jeff is smart and blunt.
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