7 Signs of Ethical Failure: Good and Bad organizational Politics

No politics! Politics is perceived to be a shady, back-room dealing, mischievous activity which should have no place in an organization. Everyone should speak honest and truthfully and promote the best interests of an organization: “We do not need politics here!”

This is silly. At least, its way to simple. Politics is “The process of making uniform decisions applying to all members of a group” – this could be a definition for management, too. But it is the official definition of the term “politics”. All organizations are political – by definition.

Politics are unavoidable

Every decision made for a group is a political one. There is no way around this. Politics – according to wikipedia is:

  • to achieve and exercise positions of governance
  • to organize control over a human community
  • the study or practice of the distribution of power and resources within a given community (a usually hierarchically organized population)
  • the study of the interrelationship(s) between communities

Most of the time, we tend to think of politics as being primarily a part of the democratic system. After all, thats the sphere where the term politics is most used. But politics are an integral part of any hierarchical system too, e.g. for all companies.

Organization and Politics are vastly redundant terms, there is a huge overlap:

An organization is an entity with a collective purpose that is interacting internally and externally on political terms.

Politics are necessary

The way decisions are made and executed within a group determines the performance of an organization.

Take a minute and reflect on that sentence. If this is true, any manager of any organization needs to shape up his political acumen to succeed. And managers all over the world are doing just that. Some by undergoing trainings in management, coaching, reading. Most by practicing daily business, thereby observing what works and what not.

Whatever the method of learning, managers are practitioners of politics. Those who are mastering politics as a skill will perform better for the sake of the organization, the people around them and themselves.

Organization, Management and Politics are all terms with a huge overlap. It is very hard to find any term in the tag cloud (at the beginning of this post) that does not have a meaning in one of those three areas.

Good politics – Bad politics

Pretending ignorance to politics is not going to help an organization. So it all comes down to the point of mastering politics well. But what is the transmission mechanism between politics and business performance? Let us take a clue from Daran Acemoglu and James Robinsons Book “Why nations fail: The origins of power, Prosperity and Poverty“.


Or lets look at the causation in the reverse order:

  • Good economic performance comes from a good organization – in the long term
  • A good organization can only be shaped and sustained in a functional political process

A business model or an organizational chart is a result of a political process between a diverse group of interests such as shareholders, managers, employees and banks. There is no single dynamic, all knowing individual shaping an organization to its will. But there is a political process that is balancing all the powers of the various interests and people. Even Bill Gates or Steve Jobs were not the almighty entrepreneurs, they needed others to succeed:  They were excellent managers of a political process.

What is a good political process?

Art Kleiner argues in his 2003 book “Who really matters: the Core group theory of privilege, power and success” that bad politics is about:

  • Individual self interest
  • Control over resources
  • Empire building: Gaining and retaining power

In contrast to this good politics is about honest and open debate about ideas, values and the organizations future direction.

How to identify good and bad politics?

Chris Ertel and Lisa Kay Solomon,  in their 2014 book  “Moments of truth: How to design strategic conversations that accelerate change“, hint how to identify good and bad politics by analyzing the comments made by managers during interviews.

Bad politics are likely if managers…

  • Comments feature elaborate rationales why their unit, department or team is doing well
  • All problems lie elsewhere
  • Posturing and positioning

Good politics are likely if managers…

  • Focus on big picture issues
  • Focus on customer and trends, that are driving change in the market
  • Internal issues are addressed more more in the spirit of trying to understand complex personalities and group dynamics rather then gaming them

A more detailed model is offered by Marianne Jennings in her 2006 book “The seven signs of ethical collapse: How to spot moral melt-downs in companies before it is too late“.


Most readers will find some of those seven signs in its organization. This is only natural, as hierarchal organizations tend to produce those behaviors listed above. In a hierarchy, it pays to be a staunch advocate of the boss, as stating a divergent opinion tends to be bad career move.

In a democracy, in contrast, it pays to be a demagogue, i.e. over-simplifying matters to gain attention and arise emotions. Each organizational principle of a company has its set of compliant, winning behaviors for individuals.

If these behaviors are allowed to spread uncontrolled by lack of a good political system, a lack of good”corporate governance“, consisting of checks and balances, chances are that the bad political system will influence the organization and ultimately ruin business results.

Conclusion: It’s politics, stupid!

Organizations are shaped by political processes. That is a fact and needs to be managed. Without political acumen a manager will fail.

It is the back room dealing, lying, dark and sinister Machiavellian elements of politics that people reject – leading to the statement “No Politics”.

But good politics are essential for economic performance of any company, so knowing how to set-up and act within a political process is all important.

Digital transformations, the core theme of this blog, will not happen if politics are not brilliantly managed. After all technology is far ahead of human’s ability to make productive use of it. So the real constraint to progress is not technology, it is decision making in human groups.

With professional, good use of the political process, organizations can decrease this gap between the possible and the current  state of business – and outsmart the competition.

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