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Doing it Right Instead of Twice: A Popperian Approach to Management Decisions

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Abstract

Fundamental to Sir Karl Popper’s oeuvre was the insight that humans err — and that we can learn from our mistakes. Critique is therefore valuable in all human endeavours. Although this stance is most famously seen in Popper’s claim that to be scientific a theory or hypothesis has to be falsifiable, Popper adopted a critical approach extensively in his work towards whatever crossed his path. Yet he never developed or suggested a general method of criticism. In this paper we present and explain a method of criticism consistent with Popper’s approach and applicable to every rationally accessible part of human life including management theory and practice.

Managers of course already know the importance of learning from mistakes. But what we propose here in our Model of Rational Criticism places the emphasis on learning before we actually make the mistakes by seeking to eradicate errors of reasoning, thus reducing the chance of costly errors in implementation. We conclude by exploring some of the implications of our model for managers.

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References

  1. Karl R Popper The Logic of Scientific Discovery London, Hutchinson 1968. Originally published in German as Logik der Forschung, Vienna 1935, Popper himself translated it into English. When it appeared in 1959 with Hutchinson, London,25 years after the German edition only a few complementary remarks were added to the original version.

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  2. Karl R Popper The Open Society and Its Enemies. Part I: The Spell of Plato London, Routledge & Kegan 1962a; Karl R Popper The Open Society and Its Enemies. Part II: The High Tide of Prophecy: Hegel, Marx and the Aftermath London, Routledge & Kegan 1962b. The two volumes of this work were originally published in English in 1945 with Routledge & Sons, London, and later translated into many languages.

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  3. Popper op cit 1962b p 228

  4. Ibid p 375. The insight that humans err is, of course, not new. Socrates stated it unambiguously. Later writers like Francis Bacon pointed out this peculiar feature of human nature and used it as a starting point for his famous Doctrine of Idols. Popper, however, generalised this view and made it applicable to all areas of human life including management and economics.

  5. Hans Albert Treatise on Critical Rationalism Princeton NJ, Princeton University Press 1985 p 48

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  6. Popper op cit (1968) pp 93–94

  7. Popper op cit (1962b) p 379

  8. Ibid p 238

  9. Ibid

  10. This unity of human reason is another of Popper's assumptions, the status of which could be debated at length. However, it seems by no means an unwarranted one, as the worldwide usage and functioning of scientific, technical and medical achievements as well as computer applications prove in diverse cultural settings.

  11. Popper op cit 1962b p 217

  12. Ibid p 239

  13. Popper op cit 1962a p 158

  14. Popper op cit 1962b p 237

  15. In his Addendum to The Open Society, Popper poses the question ‘Is a Critical Method Possible?’ 1962b pp 378–380. He makes some brief remarks about certain assumptions that are required in each and every case of criticism, but he does not outline or discuss a critical method as such.

  16. As we think of them theories can include management policies, strategies, value statements, decisions and the like. We explain below how they can be construed as theories.

  17. Although Popper op cit 1962b p 380 writes: ‘Quite generally, we may say that valid criticism of a theory consists in pointing out that a theory does not succeed in solving the problems which it was supposed to solve’, this ‘pointing out’ is neither substantial nor justified unless the reasons are explained why that theory fails to meet its supposed goal.

  18. We are assuming that the classical two-valued logic will suffice in most cases of critical arguments.

  19. Although the OC will often refer to a written text, the original utterance to be criticised need not be a written one; it could be spoken or even, as explained below, an action. We are thus using the term ‘author’ in the wider sense indicated by its Latin root of auctor, from the verb augere, to increase, promote or originate.

  20. A good deal of moral responsibility is involved in the art of criticism. Although we cannot go into further details here, we want to emphasise the well-established principles of mutual respect and fairness, of honesty and self-criticism that make up the moral basis of rational reasoning Popper 1962b, p 238; cf also Karl R Popper ‘The Moral Responsibility of the Scientist’ in: P Weingartner and G Zecha (eds) Induction, Physics and Ethics. Proceedings and Discussions of the 1968 Salzburg Colloquium in the Philosophy of Science Dordrecht, Reidel 1970, pp 329–336.

  21. In science as well as in everyday life we want to criticise not only statements (thus theories, hypotheses etc.), but also actions. We will come back to the critical evaluation of actions in step (6).

  22. By ‘sophisticated capital investment appraisal techniques’ we mean discounted cash flow (DCF) methods such as net present value (NPV) and internal rate of return (IRR), as opposed to more traditional techniques such as payback or accounting rate of return (ARR).

  23. In this context it is interesting that Peter Drucker defined the first step in effective decision making as the search for a rule relevant to the issue being decided: ‘The first question the effective decision maker asks is: ‘Is this a generic situation or an exception? Is this something that underlies a great many occurrences? Or is the occurrence a unique event that needs to be dealt with as such?’ The generic always has to be answered through a rule, a principle. The exceptional can only be handled as such, and as it comes….Truly unique events are rare, however.’ The Effective Executive Pan Books, London 1970 pp 125–6 (original publication 1966)

  24. Justifying IC is the most important element of the model and might normally take up more space and effort. For the purposes of this simple example we have used a claim from authority, which we acknowledge could itself be subject to the critical thinking test if not expanded.

  25. Compare the experience reported in some organisations that ‘There is never time to do it right but always time to do it twice’.

  26. We make no comment at this point on the general wisdom of the ‘best practice’ movement, only that it provides a suitable starting point for the application of the method of rational criticism.

  27. Times Higher Education Supplement 19 April 2002

  28. This is an initial supposition in order to make progress in illustrating our point. A full and proper analysis would involve further work.

  29. Ian Kessler ‘Living with the Enemy: Performance-Related Pay’ Oxford Magazine (Fourth Week, Hilary Term 2000) pp 6–7, at p 6

  30. We will not explore it here, but the nature of the process underlying ‘evidence-based policy’ is an interesting and important issue, especially in the light of the arguments of this paper regarding rational criticism.

  31. Kessler op cit p 6

  32. Ibid p 7

  33. Popper op cit (1962a) p 158 ff; also Gerhard Zecha ‘Negativer Utilitarismus’ Ethica (2001) pp 267–291

  34. Lee A Tavis Power and Responsibility. Multinational Managers and Developing Country Concerns Notre Dame, Indiana, University of Notre Dame Press 1999 p 102

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Cowton, C., Zecha, G. Doing it Right Instead of Twice: A Popperian Approach to Management Decisions. Philos. of Manag. 3, 23–33 (2003). https://doi.org/10.5840/pom20033220

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