Why being stupid is sometimes best for business

21 Mar 2013
Mats Alvesson

Critical reflection can help companies to avoid crises - but sometimes good old-fashioned stupidity can improve efficiency, according to Mats Alvesson, an Honorary professor at UQ Business School and author of a new theory of ‘functional stupidity’.

He claims that discouraging employees from expressing doubts and challenging management decisions can lead to a company’s downfall, as a number of high-profile financial collapses in recent years have shown. However it can also promote greater harmony and productivity.

Mats, who is also Professor of Organisation Studies at Lund University’s School of Economics and Management in Sweden, has published his theory in an article in the Journal of Management Studies, co-authored by his colleague André Spicer. It has also featured in leading European newspapers including the Financial Times and Le Monde.

“We see functional stupidity as the absence of critical reflection. It is a state of unity and consensus that makes employees in an organisation avoid questioning decisions, structures and visions. Paradoxically, this sometimes helps to raise the smooth and efficient functioning in an organisation,” says Mats.

“It is a double-edged sword. It is functional because it has some advantages and makes people concentrate enthusiastically on the task in hand. It is stupid because risks and problems may arise when people do not pose critical questions about what they and the organisation are doing.”

According to the researchers, some industries may be more stupid than others. Organisations which sell intellectual services or branded products, such as parts of the media, the fashion industry and consultancy firms, are particularly disposed to functional stupidity.

Mats adds: “Functional stupidity is prominent in economies that are dominated by persuasion using images and symbolic manipulation. It is preferable that people have an enthusiastic belief in an activity which may not necessarily fulfil a need. New management may be required to manage the fine balance and possible pitfalls of functional stupidity.” The overall theme of the contemporary economy of persuasion is also addressed in Alvesson’s recent book The Triumph of Emptiness (Oxford University Press).