Executive lounge fallacies
Samuel Brittan
GREAT MYTHS OF BUSINESS by William Davis Kogan Page, £18.99, pp. 219 What is a business myth? Looking down William Davis's table of contents, it is one of an ill-assorted ragbag of slogans which business executives pick up to make conversation in the belief that they represent practical wisdom. Examples are `The world is running out of oil and materi- als'; 'Small is beautiful'; 'The onset of the information society' or of 'the global marketplace'.
Because he proceeds by example, Davis does not try to analyse the origins and functions of this mythology, but he leaves the impression that businessmen and women are more attracted by generalisa- Lions and bodies of doctrine than they actu- ally are. In my own limited experience busi- ness leaders are more specific in their interests.
But perhaps the book is really directed at myths about business and not just at mis- taken views that businessmen happen to have. This would explain the inclusion of a few Old Labour beliefs such as 'state indus- tries belong to the people' — although I have not heard this particular myth since I was in short trousers and even then only from anti-socialists intent on ridiculing it.
My own interest was particularly claimed by the first chapter which deals with myths about how the economic system functions. I wish Davis had added a few more, such as the supposed special importance of manu- facturing, exports, the balance of payments and investment. Readers anxious for more extensive theory-debunking can find a run- ning series on economic fallacies by Geof- frey Wood, which appears regularly in Economic Affairs, the quarterly journal of the institute of that name.
The real targets of Davis are manage- ment experts and advisers of all kinds. For instance the American business pundit, Tom Peters, was a co-author of a best- seller, In Search of Excellence. Unfortu- nately two thirds of the companies he identified 'subsequently fell from grace'. Nevertheless there is a place for business consultants who advise on specific matters and who employ for the purpose many of the economists with whom government and non-City businesses have dispensed. These have come out of the front door and in by the back, with a considerable addition of overheard expenses.
The myth format sometimes leads to linguistic strain. For instead of just saying that substantial wage increases tend to reduce employment, Davis has to attack the belief that they do not. Occasionally too, he hits at straw men, for example the beliefs that numbers don't lie, ethics don't matter or that 'gurus' have all the answers.
I have to admit that I sometimes wished for a deeper analysis. For instance the demolition of the myth of the global marketplace is too much confined to exam- ples of obstinate differences in national habits and continued barriers to trade and investment. The point is that even in a globalised economy governments still have considerable liberty to determine policy on taxes, public spending and regulation. But they must be prepared to take the conse- quences for the exchange rate and for real take-home pay — which in any case they would have had to do before anyone had heard of globalisation.
On balance the book benefits from its departures from its self-imposed task of exposing errors. For instance in the chapter on 'Small is beautiful' the author does not say the opposite, but mainly recounts examples from his own experiences, which range from editing Punch, through publish- ing and editing British Airways' High Life and chairing the British Tourist Associa- tion, to escaping from the clutches of Robert Maxwell.
It would be a good thing if businessmen and -women and others interested in their affairs read this book. Ideally it ought to be purchased en bloc by airlines and similar organisations and distributed in aircraft, executive lounges and other places where people will pick it up and learn something even if they only look at a few pages at a time. It should also be of benefit to those in the literary and high-culture worlds who are prepared to re-examine some of their favourite stereotypes.
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