Organizational Dynamics and Evolutionary Theory

A small number of psychologists, economists, and management theorists have been enthusiastically trying to determine how modern evolutionary theory can be used to understand the dynamics of organizations. Traditional evolutionary theory—the survival of the fittest model—supports selfishness, predatory capitalism, and the importance of individual self-interest. However, some economists have begun to test people using variants of competitive games (of which the Prisoner’s Dilemma is the best known). This research has led to two important findings.

First, the strategies that people use in these competitive bargaining games fall into three robust and replicable categories. About 15% of every population consists of altruists—people whose first instinct is to cooperate, to extend benefits to others, to work for the common good. About 20% of every population consists of free riders—people whose first instinct is to take advantage of other people, act selfishly, and contribute nothing to the common good. And finally, about 65% of every population consists of people who tailor their actions to those of the other person—they will cooperate when others cooperate, and compete when others compete. Second, these data show quite clearly that the selfishness model proposed by traditional evolutionary theory is wrong, it does not characterize the behavior of most people.

The new thinking argues that traditional evolutionary theory needs to be augmented with insights from: (1) multi-level selection; and (2) gene-culture co-evolution theory. Putting the three lines of analysis together tells us that people evolved as group living animals, and that the groups competed with one another for scarce resources. This, in turn, leads to several interesting insights regarding organizational dynamics. The first insight is that the percentages of altruists, free riders/cheaters, and switch hitters described above are about what we should expect to find in any normal population.

The second insight is that people are best understood in terms of their relations to the other members of their groups. Thus, although traditional psychoanalysis and psychology has focused on isolated individuals and how they deal with their private demons, this has been a big mistake because what is inside, in people’s psyches, started outside in their relations with others.

Third, human evolutionary history has designed people so that they are preprogrammed in two main ways. On the one hand, they are from birth ready to compete with the other members of their group for status and resources. On the other hand, they will cooperate with the other members of their group when faced with external competition. Thus people live in a state of internal tension and must learn to balance their desires to compete with others against their needs for the support of others.

Fourth, every human group is faced with two unavoidable problems. On the one hand, there is a strong tendency for “leaders” to exploit their groups for their own selfish purposes, and subordinate group members must maintain a watchful eye to avoid being exploited. On the other hand, there is a strong tendency for the members of any one group to begin fighting with their neighboring groups. Thus, organizations that are composed of several groups will compete with one another based on the degree to which they can persuade their constituent groups to stop the internal fighting. Think, for example, of the two major U.S. political parties.

Finally, then, good leadership is a resource for the group rather than a source of privilege for the leader(s). Good leadership is able to: (1) persuade the subordinate group members that the leadership won’t exploit them; and (2) persuade the subordinate group members to stop fighting with one another and concentrate on the competition.

The Art of Kaizen

Kaizen refers to continuous, steady improvement. It means never being satisfied. It means continuous improvement in processes as well as products. If a company pursues kaizen, it will be able to produce higher quality products for less money.

How does assessment fit with all of this? Hiring better people is part of continuous improvement. Assessment is the key to hiring better people. Using valid assessments will yield better results than using the DISC or OPQ. Hiring better people means hiring better workers, better managers, and better leaders.

Good workers regularly come to work, follow sensible procedures, treat customers well, work well as part of a team, and accept (or don’t resist) change. Good managers provide their staff with structure and direction but treat them with respect. Good leaders are more concerned with the performance of the organization than with the advancement of their own careers. Good leaders are not charismatic, self-centered, self-promoters. Good leaders treat their staff with respect but hold them accountable for their performance, promote an appropriate philosophy and vision, and have the capacity for change. Valid assessment is the key to continuous improvement of personnel.