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Once we join an organization, life can become complicated. We face pressures to conform to group norms and expectations. We may face competition from associates for advancement. Outside forces may threaten the organization’s survival, putting pressure on you to fight for the firm’s existence.

These pressures can lead us to take actions that we would never agree to outside the organization. For example, most people would not choose to dump chemical waste in a river, yet organizations do this regularly. People like you and me run those organizations, and those people agreed to do that.

We will discuss the forces that lead good people to make questionable choices at length in this book’s final chapter. For now, the following sections introduce the tools of wisdom that can help us navigate this turbulent sea of organizational life.

It starts by introducing the challenges of organizational life that make wise action difficult and then shifts to discuss how individual wisdom can help you find your way.

Challenges of life in organizations

Organizations are often competitive environments where self-interest can undermine good intentions. Often, achieving personal success in organizations forces individuals to face moral dilemmas.[1] This desire to win (or simply to not lose) can lead us to make choices that negatively affect ourselves and our society.[2][3]

The absence of wisdom leads to five cognitive fallacies:[4]

  1. The fallacy of egocentrism (the belief one should be the center of attention),
  2. The fallacy of omnipotence (the belief that one can make others follow your every wish),
  3. The fallacy of omniscience (the assumption that one knows everything they need to know),
  4. The fallacy of invulnerability (the belief that no harm will come to you), and
  5. The fallacy of unrealistic optimism (the idea that everything will work out all right).

When individuals face morally complex situations with these cognitive fallacies, their actions at best are ineffective, but at worst are harmful.

How wisdom helps individuals overcome these challenges

The previous section painted a bleak picture of organizational life. It is not all bad, however. For example, self-interest is not the only value that dominates in organizations. Human nature is complex. There are many instances where desires other than self-interest influence behaviour, such as punishing those who act unfairly, helping those in need, and living by a code of conduct.[5] So, there are elements in any organization that individuals can leverage to face their problems constructively and consistent with their moral code.

Wisdom helps individuals navigate these challenging organizational environments through three dimensions:

  • Providing insights into human affairs, which improves individuals’ ability to lead others
  • Developing tools to manage relationships, which improves individuals’ ability to deal with others’ emotions
  • Strengthening personal self-control, which improves individuals’ ability to react thoughtfully to situations of high emotion[6]

To help us consider how individuals can develop these above attributes, this text is going to introduce a new term: phronesis.[7]

 

Phronesis (Ancient Greek: φρόνησῐς, romanized: phrónēsis) is an Ancient Greek word for a type of wisdom or intelligence. It is more specifically a type of wisdom relevant to practical action, implying both good judgement (sic) and excellence of character and habits, or practical virtue …

The word was used in Greek philosophy, and such discussions are still influential today … Because of its practical character, when it is not simply translated by words meaning wisdom or intelligence, it is often translated as “practical wisdom“, and sometimes (more traditionally) as “prudence“, from Latin prudentia. Thomas McEvilley has proposed that the best translation is “mindfulness.”

 

“Phronesis” by Wikipedia is licensed under CC BY-SA 4.0

By developing their phronesis, individuals can strengthen the attributes needed to manage organizational life’s challenging aspects. And good news, developing phronesis is something we can all choose to do.

Individuals who wish to develop their phronesis:

  • Learn from experience and help others understand their situation in a way that leads to practical action.[8]
  • Exhibit a mix of humility and open-mindedness that allows them to make sound judgments in complex and ambiguous situations over the short- and long-term. They recognize the limitations of their knowledge and are willing to learn and experiment.[9]
  • Focus on the needs of specific situations rather than general laws. They assess a situation and judge whether they should apply general rules or make an exception.[10]
  • Can operate in complex environments where there are different issues and no apparent ‘right answer’ to the problems they face.[11]
  • Bring their whole person to bear when dealing with complex situations–their emotions, character, intelligence, and creativity.[12]
  • Recognize how the unique strengths of other individuals involved in the situation can help address the problems faced.[13]

As you work your way through this textbook, you will acquire tools and insights that will help you develop your own phronesis.

Exercises

The above description of the qualities of people exhibiting phronesis often refers to situations of complexity. These situations may involve many different people with different perspectives and desires.

There may be contradictory issues (e.g., some information may suggest one course of action is best; other information may argue against it). There may be no single ‘right answer’ to the problem people face–that is, every option has good and bad trade-offs.

  1. Can you think of an example of this type of situation? Think about your own experiences. Perhaps you and your group of friends or family experienced a problem like this. Are there social issues in the world today that fit this description? Once you have this example in mind, describe it. What makes it complex? What are the conflicting issues? Why is there no clear ‘right answer’ to the problem?
  2. Describe how a person exhibiting phronesis might approach the situation you have described.
  3. Consider the Five Cognitive Fallacies listed above. How would each of those fallacies make it harder to resolve the situation you have described?

Key Takeaways

  1. Bartunek, J. M., & Trullen, J. (2007). Individual Ethics--The Virtue of Prudence. In E. H. Kessler & J. R. Bailey (Eds.), Handbook of Organizational and Managerial Wisdom (pp. 91–108). Thousand Oaks, CA: Sage Publications Inc. ↵
  2. Badaracco, J. L. (1997). Defining Moments: When Managers Must Choose Between Right and Right. Boston: Harvard University Press. ↵
  3. Cropanzano, R., Stein, J., & Goldman, B. M. (2007). Individual Aesthetics--Self-interest. In E. H. Kessler & J. R. Bailey (Eds.), Handbook of Organizational and Managerial Wisdom (pp. 181–221). Thousand Oaks: Sage Publications Inc. ↵
  4. Jordan, J., & Sternberg, R. J. (2007). Individual Logic--Wisdom in Organizations: A Balance Theory Analysis. In E. H. Kessler & J. R. Bailey (Eds.), Handbook of Organizational and Managerial Wisdom (pp. 3–19). Thousand Oaks, CA: Sage Publications Inc. ↵
  5. Cropanzano, R., Stein, J., & Goldman, B. M. (2007). Individual Aesthetics--Self-interest. In E. H. Kessler & J. R. Bailey (Eds.), Handbook of Organizational and Managerial Wisdom (pp. 181–221). Thousand Oaks: Sage Publications Inc. ↵
  6. Nicholson, N. (2007). Individual Metaphysics--The Getting of Wisdom: Self-conduct, Personal Identity, and Wisdom Across the Life Span. In E. H. Kessler & J. R. Bailey (Eds.), Handbook of Organizational and Managerial Wisdom (pp. 377–397). Thousand Oaks, CA: Sage Publications Inc. ↵
  7. Flyvbjerg, B. (2001). Making Social Science Matter: Why Social Inquiry Fails and How It Can Succeed Again. New York, NY: Cambridge University Press. ↵
  8. Gioia, D. A. (2007). Individual Epistemology--Interpretive Wisdom. In E. H. Kessler & J. R. Bailey (Eds.), Handbook of Organizational and Managerial Wisdom (pp. 276–294). Thousand Oaks, CA: Sage Publications Inc. ↵
  9. Nicholson, N. (2007). Individual Metaphysics--The Getting of Wisdom: Self-conduct, Personal Identity, and Wisdom Across the Life Span. In E. H. Kessler & J. R. Bailey (Eds.), Handbook of Organizational and Managerial Wisdom (pp. 377–397). Thousand Oaks, CA: Sage Publications Inc. ↵
  10. Flyvbjerg, B. (2001). Making Social Science Matter: Why Social Inquiry Fails and How It Can Succeed Again. New York, NY: Cambridge University Press. ↵
  11. Sternberg, R. J. (1998). A Balance Theory of Wisdom. Review of General Psychology, 2(4), 347–365. ↵
  12. Durand, R., & Calori, R. (2006). Sameness, Otherness? Enriching Organizational Change Theories with Philosophical Considerations on the Same and the Other. Academy of Management Review, 31(1), 93–114. ↵
  13. Durand, R., & Calori, R. (2006). Sameness, Otherness? Enriching Organizational Change Theories with Philosophical Considerations on the Same and the Other. Academy of Management Review, 31(1), 93–114. ↵
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Developing Organizational and Managerial Wisdom - 2nd Edition (Audio plus text version) Copyright © 2024 by Brad C. Anderson is licensed under a Creative Commons Attribution 4.0 International License, except where otherwise noted.

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