Companies Are Run By People

I’ve been reading a few books simultaneously lately, and there’s a common theme that I’ve long believed in, but it’s gratifying that it’s a) been noticed by other people, and b) was noticed a long time ago: companies are run by people.

It’s a central theme in Porter’s Competitive Strategy. I’m struck by how much of the book is about dealing with other companies as inherently run by human beings; human beings who are fallible, and at times irrational. Not enough management time is spent thinking in these terms.

It’s very easy to fall into the trap of viewing other groups of people (companies, countries, the economy) as being a single entity that acts with one mind. Certainly, that’s a goal in many companies, but it is rarely achieved. Indeed, as more and more people get involved, the less cohesive things appear to be on the inside, regardless of the external perception. The more communication paths that are required, the more individuals with personalities there are, the harder it is to keep everyone from splintering off into their own factions.

Anyone who has worked for a large company will recognise the effect: lots of little fiefdoms, all with their own agendas, often in conflict with one another. People often disagree with one another, and most people have difficulty with inter-personal relationships (I am no exception). Just look at the Self Help section of your local bookshelf for evidence of how much of a problem this is. So, as things scale up, the more likely it is that factions and fiefdoms will develop.

So why do we persist in treating companies as if they were a single, monolithic entity that acts with one mind?

Because it’s harder not to. If you have to treat a company as being not simply the sum of its parts, but as the parts themselves, you have a lot more things, and people, to deal with. That takes more effort. It’s much easier to summarise, to generalise, to speak of The Company as an entity in its own right. A body corporate may be a non-natural person in terms of the law, it is still full of people. If you focus too hard on the group, it’s easy to forget that the group consists of individuals. People.

Selfish, arrogant, ignorant, driven, creative, passionate, kind, wonderful people.

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