The Principle of Principles.

In almost all the companies and organizations (including the army) I have worked with in my life, I have been met with rules and way of doing things, that have been guiding leaders and employees in how to best do things around here.

I am sure we all have recognized expressions like, “this is just the way we do things” or maybe more familiar “this is NOT how we do things around here”.

These rules, behaviors, beliefs or engrained way of doing things, are what I call “principles” under one in this article. There might be academic differences, but for the point I wish to make here I will keep it simple.

The word principle is derived from old French and has it’s origin from the Latin words principium – source and principia – foundations. ?

This resonates well with the interpretation of principles in todays business setting. We have some fundamental principles that is the source of how we operate.

In a behavioral perspective, principles make sense. When we have principles it saves us from repeating the optimal rules for doing things. This is fully in line with the biological argument put forward by Daniel Kahneman in his brilliant book “Thinking Fast and Slow” about our two modes of thinking; system 1 and system 2.

Shortly put, system 1 is where we process more repetitive and known situations and more importantly at low energy levels. System 2 is for more complex, unique or new situations.

As an example: First time you drive to work at a new place you use system 2, but after half a year of driving the same route your brain is running in system 1 mode and you almost drive in pure automatic mode.

There is a strong evolutionary argument for this. Which is energy optimization. In prehistoric times where energy sources (food) was scarce, the humas ancestors with better energy optimization system design had an advantage.

Ok that was a little sidetrack, but important to understand.

So what is the Principle of Principles ?

“Principles should be followed as long as they serve their purpose”

Duh, that sounds pretty obvious.

Yes you’re right. It sounds obvious. But as we all know who have worked in any organization for some time, obvious and common sense can sometimes be filtered out by engrained cultural beliefs and behavioral norms.

In general I am a great believer in principles being used in organizations as a way of guiding decisions, behaviors through the organization as it empowers people to take fast decisions locally without having to involve to many other people, typically managers or leaders.

However only when principles are explicit and clear. In many places there are principles which guides peoples behavior, which are not explicit nor understood as to the reasoning behind these principles. So first step is to create transparency about principles guiding the organization.

We also need to distinguish between principles based on their application in the organization.

In most organizations, there are typically principles at highest level, these can also be called values and sets out some very fundamental guidelines to what’s considered good behavior and one should focus on long term. These are often derived from long-term insights into what have made this organization successful over the years in very fundamental ways.

If we go further into the operational machine of a company, as an example, there could be principles of financial risk, customer engagement or product development. All of which would be experienced as hardcoded “ways of doing things around here”. Now in many cases it makes sense, as they have developed or evolved over years because they proved to deliver results.

But if there is one thing, we all agree on is this day and age, is the fact that we live in a world that is changing faster and faster.

Principles defined in a particular market setting or in a different technological era or in a time when employees were children of a different educational model, are not always the best principles anymore.

The tough leadership task is to acknowledge, when is the time to abandon, previous successful principles and jump into unfamiliar territory, and energy intensive system 2 mindset, to redefine the new principles that will lead the company to success in the future.

It takes leadership and an empowered organization to ask if our principles are still the best to serve their purpose.

What would be your indicators of when to perform a specific principle purpose review ?

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