The Pyschopathology of Organizations

Some of today’s organizations are psychologically and ethically sick. Maybe that is why the people who work in them begin to act in sick ways too.

Business thinking has fallen into a number of bad habits in the past few decades, but one of the worst is the assumption that bad actions, whether in the general office or the boardroom, are solely due to the personality, character, or ethical problems of individual perpetrators. Firing the people involved, or disciplining them in some other way, is seen as providing a total solution to such issues. The slate is wiped clean. This is not the case, as I will show.

We rightly expect people to be held accountable for their actions—especially those in positions of power and trust. Every action represents some more or less conscious choice, and we all need to acknowledge that our choices have consequences. Yet personal decisions, whether inspired by problems of personality, defective values, or ethical blindness, are far from the only factors at work when things go wrong. Organizations can become damaged, perverted, or just plain sick within themselves, just as much as individuals can. A single, mentally sick individual has pointlessly destroyed more than 30 innocent lives at Virginia Tech. A single ethically and procedurally sick organization can take away thousands of people’s jobs, destroy their pensions, or subject its workers to daily cruelty, humiliation, and exploitation.

Human organizations are hybrid entities: part mechanical systems and constructions; part human communities, with all the emotional and psychological baggage that entails. Probably the best way to see them is as biological entities. We humans, for example, have some largely mechanical parts to our bodies (bones and muscles), which grow and develop over time to provide the necessary framework. What animates and directs that framework is our brain: the thinking, feeling, judging part, with its own complex of automatic systems and conscious choices.

As our bodies may develop handicaps, sicknesses, and diseases, so organizations can become crippled and distorted.

In much the same way, organizations develop frameworks of systems, policies, money flows, and procedures, directed and animated by the human element. As our bodies may develop handicaps, sicknesses, and diseases, so organizations can become crippled and distorted so that their systems work in negative and destructive ways.

When that happens, the organization itself becomes sick and provides an unhealthy, even poisonous, culture and context for work. In time, if the people within it fail to take action to heal the sickness, they too are made sick by the context of negativity and the warped outlook all around them.

Stanford Psychology Professor Emeritus Philip Zimbardo conducted an experiment in 1971, using prison inmates, in which he showed how systems, situations, and roles involving power influence human behavior. His book, The Lucifer Effect: Understanding How Good People Turn Evil, isn’t an easy read. The examples are too often of horrific cruelty and abuse and the style is somewhat ponderous and hectoring. But the point remains that there is good evidence, culled from multiple sources, that sick organizational and social contexts quickly make the people within them act in equally sick and perverted ways. It’s just a question of which comes first: whether the apples in the barrel were bad, or (his view) the barrel was bad and infected the apples.

What we see all too often today are organizations rich in spreadsheets, but with withered or distorted hearts.

Within the business world, I suspect that there are both bad apples and bad barrels. We seem to be very aware of the first and somewhat blind to the second. Yet those in charge of organizations surely have the duty to correct or root out their own sick systems and attitudes, just as much as they have a duty to deal with badly behaved individuals. If we, as a society, ought to refuse to tolerate jerks in positions of power—as we certainly ought—we should also refuse to tolerate organizational systems and approaches that create more jerks, more cruelty, and more barbarism in our workplaces.

What we see all too often today are organizations rich in spreadsheets, but with withered or distorted hearts. Places where people are treated as costly but inanimate objects, to be exploited and casually discarded, not as fellow human beings with hopes, dreams, and feelings. Work in an organization like that for too long and you risk seeing that distorted situation as normal. You become infected with the sickness all around you.

Do businesses exist to create profits? Of course. Is it acceptable to create profits in any way that works? Surely not, just as it is unacceptable in a civilized society to extract information by means of torture, even if that method seems to some to be likely to deliver what is wanted.

Business and organizational leaders must be held accountable for more than the financial health of their enterprises. The emotional, ethical, and psychological health of those systems is also their responsibility. They would do well to give that much more thought than they do.

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