Part 1: Corporate Toxicity, Incentives of Toxicity for Managers and Management

Fortunately, or perhaps unfortunately, I have had the privilege to work with Toxic Managers. Hence, this blog is a take on Corporate Toxicity from experience as well as déjà vu instances encountered while reading the book. And I wish that I had read The Devil Wears Prada rather than reading other books on dynamic and demanding workplaces.

Why resort to Toxicity? The Incentives

You must be wondering why some people are be toxic? And how do they reach the top despite the soc called checks and balances of HR and Corporate Governance? The straightforward answer is that Toxicity is effective and gets things done – after corporations are all about Shareholder value! These managers ensure that you – a resource – yield at least 100% of your potential, optimizing the Human Resources cost. In an attempt to find the silver lining, I would say that this certainly helps pushing and exploring your limits, but prolonged stress induced from such toxic pressures is way more than unhealthy – mentally and physically.

It is the fundamental principle of Game Theory, with right incentives – an individual will defect from collective behavior to pursue individual incentives, even at the cost of the collective. This also sets the per-requisite for toxicity, being highly self- centered. As the adage goes – every man for himself – acting in self-interest is human nature. The extent such self-interest gets pursued is subject to of individual values and ethics along with legality and culture.

Although none permit such pursuit at the cost of collective, asymmetry of consequences in the real-world results in undesired scenario. This is also known as the tragedy of the commons, where the collective pays the cost when an individual decides to prioritize own interests over collective. For instance, before the days of land ownership cattle crazing occurred in common pastures, and an individual cattle owner could always choose to act in self interest and overgraze the cattle at the expense of the depletion of the collective asset – lush green pastures. Fast forward today, individual incentives, achievements, and well-being are the individual interests over team goals.

So, we can now understand and agree that Managers have at least a fair bit of incentive to resort to toxic measures, while the Management has incentives to turn a blind eye. But why resort to toxicity, when there are dozens of books on driving organization through leadership. The answer is that because it is easier to succeed with toxicity as compared to becoming a leader.

Leadership requires efforts and competence, whereas toxicity requires only an aura of competence. If you are wondering that how could they attain such high ranks without being competent, you are too naïve! Corporate and bureaucracy positions are often attained through political expertise and diplomacy. And as we will learn in following parts, the only expertise in toxicity is diplomacy.

However, you must be wondering, they need to show results and how could someone show results without competence? This is where single minded approach and manipulation – bending the truth or framing the information favorably – come into play. The single minded approach leads to short term thinking and approach such as code without comments, makeshift software architecture, and patches that literally patchwork. It also leads to pursuing unsustainable business practices such as Channel Stuffing, where goods are pushed to distributors despite absence of demand and refusal from distributors.

However, if such practices are is built on delusion and hollow achievements – which is beyond single minded approach and unsustainable practices, it leads to governance nightmares. And when the scandal brews too hot, it ultimately leads to fiascos such as Theranos, Enron, etc. Though there are many other names, with obvious symptoms of toxicity and cult, I limit the examples to avoid controversies. Despite short term advantages for management – in terms of shareholder confidence and stock price appreciation – long term risks are way too substantial. However, most believe it to be a tomorrow problem for someone else and ride the wave till the music plays.

Photo by Bernd 📷 Dittrich on Unsplash