The end of Homo Economicus – The beginning of Homo Narrans ?
Posted by Andrew 21 July 2009
In this months edition of the Harvard Business Review there appears an interesting article titled “The End of Rational Economics”.
The idea in brief of this article is (to quote HBR):
“The global economic crisis has shattered two articles of faith in standard economic theory: that human beings usually make rational decisions and that the market’s invisible hand serves as a trustworthy corrective to imbalance.”
With an interest in anything that helps us realise that we are living in a complex, non-linear world, I continued to read on with intrigue. Homo Economicus is the man behind the mirror that has been a living assumption to how we supposedly make decisions. Rationally.
I remember I once read a great quote saying that man is not an “Irrational Animal” but rather is an “Ational Irranimal”. But I digress.
This article appears to be bringing some sunshine into the world of organisations, corporations and business, by suggesting that we humans arent the automatons that we once apparently thought we were, but rather we are alot more complex than previously thought. Maybe even irrational, with unconscious or subconscious processes going on.
After reading for a little while I catch scent of a problem. And the problem is, it turns out, an old problem for management theory called the gloomy vision problem.
Now don’t get me wrong, I’m all for not being falsely positive and having a good bitch, moan or whine or doing any of the grief work that might be part of life. But, the gloomy vision problem as suggested by Goshal in “Bad management theories are destroying good management practices” is something special inherited by a school of thought and management theories propagated over time and it is essentially that “People are bad”.
Some examples from this article are:
“Most individuals, operating on their own and given the opportunity, will cheat – but just a little bit.”
And another:
“Revenge and cheating are only two of the irrational behaviours that underlie employee’s and customers’ decisions.”
I think it’s intriguing how closely the “People are bad” gloomy vision appears to align with the Theory X model which emerged from the MIT sloan school of management professor, Douglas McGregor, in his Theory X and Theory Y in the 1960’s. Essentially, to paraphrase, Theory X says “If you give people a chance… they will… lie, steal, cheat, bludge and not work”. Therefore you need to setup control systems which are focussed on getting these people to work. Theory Y says “If you give people a chance… they will… do their best work”.
Whilst the gloomy vision problem does appear to still be prevalent, I wonder whether this emerging realisation that we aren’t automatons who make “rational” decisions and the subsequent end of Homo Economicus might lead us to finally starting to realise our true identities as Homo Narrans? The story telling apes? Artistic. Creative. And yes – maybe – we are “Ational Irranimals”.
Interested in liberating your “Homo Narrans” within? Be sure to check out our national story conference October 8 and 9th.