My Follower: Friend or Foe?

My Follower: Friend or Foe?

Former U.N. Secretary General, Kofi Annan once said, “Knowledge is power. Information is liberating. Education is the premise of progress, in every society, in every family.”[1] So why do so many leaders withhold information from their followers? Is it to keep power? Is it to prevent liberation? Is it to stifle progress? Do they believe they are ‘protecting’ their followers? This article discusses the topic of information asymmetry as it relates to the leader/follower relationship. It also discusses the byproducts and impact that information asymmetry has on organizational development and success. By reading this article and understanding the impact of information asymmetry, leaders will be able to assess their approach to information sharing in their leader/follower relationships and guard against some of the most destructive organizational pathogens. In order to move towards this understanding, we must first understand the basics and roots of information asymmetry.

Information Asymmetry Defined

As a concept, information asymmetry is most often described as an economic term, investing phenomenon, or contractual negotiation situation. The term is used to describe the different quantities and quality of information that parties engaged in a similar pursuit, possesses. There has been some work to describe information asymmetry as it relates to organizations and leader/follower relationships. However, in these cases, the follower is described as having the greatest information over individual work products[2]. These concepts can more broadly be classified as Organizational Economics. Organizational Economics is the intersection between agency theory and transaction cost economics[3]. In general, these concepts postulate that individuals are self-serving and aim to maximize their personal agenda while minimizing output[4]. The ‘agent’ (follower), as derived from agency theory, is characterized in a light that assumes these characteristics. The overall situation mirrors the classical Theory X view of human behavior advocated by Douglas McGregor, which states that man is inherently lazy and self-serving[5].

Dealing with Theory X

The Theory X approach to human behavior is limited and inaccurate at best. Several individuals in history clearly and wholly transcend Theory X’s belief in the selfish and self-serving nature of man. Consider figures like Mother Theresa, Martin Luther King, Jr., and all of Jesus’ disciples who died horrific deaths for a higher cause. These men and women lived for causes that did not necessarily meet their earthly ‘best interest’. In economic terms, their activities represent the highest and most irrational forms of behavior. Rationality, interestingly enough, is the cornerstone of most economic theories, to include Organizational Economics.

It is clear that Theory X is at best, a situational representation of human behavior. Theory X may describe the carnality of man’s basic needs for survival. However, it does not account for the spiritual or intellectual capabilities of man, which is what truly sets us apart from the other species. These are the transcendent characteristics that make man unpredictable. With Theory X being removed from the equation, we are left with the fact that information asymmetry can exist at two levels – the leader with information beyond the follower at the strategic level and the follower beyond the leader at the tactical level. In short, the Organizational Economic standoff between competing desires.

Balancing the Economic Factors

Concluding these concepts returns us to the concept that information and knowledge is power. So, in the information standoff between leaders and followers, who yields first? Which party should cede the ‘economic advantages’ of information asymmetry and become vulnerable? This type of scenario is often approached as a ‘zero-sum game’ in game theory terms. A zero-sum game means that one person must lose and another must win[6]. This is how many leaders and followers approach information. It isn’t so much to leverage the advantage, as posited in Theory X, but to protect the status quo within the game. Neither party wants to be taken advantage of.

The type of scenario actually at play is, in game theory terms, a ‘Prisoner’s Dilemma’. In a Prisoner’s Dilemma, acting in a manner of strict personal interest yields an inferior result to acting in cooperation with an adversary[7]. The information hoarding and ensuing standoff creates a situation of mutually diminished results and capabilities. Even if each player is only attempting to protect the status quo, the mutual results are less than a cooperative effort. Because each party is fearful of relinquishing control, stagnation and fear creep in and stifle progress and optimization.

Consider the fact that the world superpowers found themselves in just such a situation during the late 1950’s. The world was on the brink of nuclear holocaust with the major super powers prepared to execute a strategic plan of M.A.D. (Mutually Assured Destruction). Neither power was necessarily seeking strict advantage, but instead some level of preservation. However, President Dwight D. Eisenhower in his 1953 “Atoms for Peace” speech set the stage for the Nuclear Non-Proliferation Treaty (NPT) – the treaty to seek mutual gain by mutual reduction of nuclear weapons[8]. Through Eisenhower’s act, the world leader, the United States, ceded the ‘advantage’ and signaled cooperation. The ‘follower’, the USSR, responded and cooperated with the treaty and the world backed away from Mutually Assured Destruction.

What happens if we chose not to cooperate? What are the byproducts of prolonged information asymmetry and competitive behavior? Are we, in fact, initiating our own ‘Mutually Assured Destruction’? These are all critical aspects to the larger ‘game’ and must be addressed in order to gain an appreciation for the stakes.

The Byproducts of Information Asymmetry and Uncooperative Behavior

The long-term effect of information asymmetry in a leader/follower relationship is mutually uncooperative behavior and paranoia. The dichotomy and polarity of the situation can breed nothing but mutual distrust, even if it is only small at first. Indeed, this is only one element of a larger pathology. Consider that most organizational pathologies are rooted in the abuse of power[9]. Referring back to our original premise as information being power, we are in fact encouraging a dangerous pathogen to take root within our organization – one that will eventually consume and corrupt the enterprise. It is quite possible that such situations actually create the Theory X representation of man where it may not naturally exist; an image of man paranoid, fearful, distrustful, and ultimately self-serving as a means of preservation. In a leader/follower relationship there is no room for distributive and competitive behavior. The concept erodes the very influence needed for a leader to succeed.

A paramount example of the corrupting factors of this paranoia, fear, and distrust is Richard Nixon. He was consumed by paranoia and mistrust and would seek to gather information against enemies and friends alike[10]. His paranoia and obsession with using information as a weapon eventually became his personal downfall and shook the faith of the American people in its government. As organizational leaders we have to address our fears for relinquishing control and our discomfort with being vulnerable in order to create change and progress.

Why Do Leaders Fear?

The main reason that we fear ceding the ‘upper hand’ or at minimum, an ‘even hand’, is rooted in the unknown. Fear is a cognitive process derived from the ‘…awareness, recognition, (and) anticipation that something undesirable may occur.’[11] Our fear of the unknown is what causes irrational thoughts and behaviors[12]. This is the same reason that individuals have fears of heights, animals, insects, etc. For many of us, the feelings of fear are derived from previous experiences. Perhaps we have been in similar situations where we were hurt while vulnerable. We tend to carry with us all of these lessons, whether at the conscious or subconscious level. As we consider relinquishing our control of the situation and by extension, the future outcomes, we are once again faced with this vulnerability.

As you consider your own reasons for maintaining the status quo, ask yourself, ‘what are my vulnerabilities?’. Be bold in assessing the thoughts and motivations that are holding you and your follower(s) stagnate. Also, address your fears. Seek to understand why you are fearful of letting go of full control in the situation. By addressing these issues in the context of this situation, you will begin to understand what is binding you to the uncooperative track in the ‘Prisoner’s Dilemma’ scenario. A critical tool in this analysis is prayer. Seek guidance and truth beyond your intellect and delve into the deeper truths. Here you will find greater answers to your fears and the strength to overcome them.

What We Can Do Going Forward

It is clear first and foremost; we must relinquish our fear of the unknown. As leaders, we have to be comfortable with the concept of letting go of absolute control in order to create a climate of change and cooperation. By ceding the power in the information that we have, we can be a preventative measure to the Theory X incarnation within our followers. Furthermore, we can move to a more transformative mode of leadership.

To accomplish these things, we need to approach the situation of information asymmetry as an integrative negotiation. Simply stated, we need to focus on the commonalities in our pursuits[13]. By focusing on our mutual goals, we can create inroads to collaboration and transformative leadership. Exchange information with your follower – be the first to reach out in this way[14]. Let your follower know the real information about what is going on within the organization, not just the glossy media pieces – be authentic! Finally, seek ‘win-win’ outcomes to information sharing[15] [16]. By showing that you are interested in your follower’s needs, you can establish a mutually beneficial partnership instead of an information stand-off. This will help ensure that the organizational pathogens of distrust and fear do not take root. In the end, you will be able to le

[1] http://www.un.org/News/Press/docs/1997/19970623.sgsm6268.html. Retrieved on August 9, 2008.

[2] Park, T.H. (1989). The Positive Analysis of Hierarchical Behavior and Decisions in Organizations. Retrieved on August 9, 2008, from ProQuest Database.

[3] Donaldson, L. (1990). The Etherealhand: Organizational Economics and Management Theory. Academy of Management Review (Vol 15, No. 3). Retrieved on August 10, 2008, from JSTOR database.

[4] Donaldson, L. (1990). The Etherealhand: Organizational Economics and Management Theory. Academy of Management Review (Vol 15, No. 3). Retrieved on August 10, 2008, from JSTOR database.

[5] Schein, E. (1994). Organizational Psychology, 3rd Ed. Upper Saddle River, NJ: Prentice Hall.

[6] Ward, D. The Program Manager’s Dilemma: Trust, Cooperation, and Competition in the Acquisition Community. Defense AT&L, May-June 2004. Retrieved on August 11, 2008, from http://www.dau.mil/pubs/dam/05_06_2004/war-mj04.pdf.

[7] Ward, D. The Program Manager’s Dilemma: Trust, Cooperation, and Competition in the Acquisition Community. Defense AT&L, May-June 2004. Retrieved on August 11, 2008, from http://www.dau.mil/pubs/dam/05_06_2004/war-mj04.pdf.

[8] Schultz, G.P., Perry, W.J., Kissinger, H.A., Nunn, S. (2007). A World Free of Nuclear Weapons. Wall Street Journal, January 4, 2007, p. A15. Retrieved on August 11, 2008, from http://media.hoover.org/documents/0817948429_3.pdf.

[9] Scott, W.R. (2003). Organizations: Rational, Natural, and Open Systems, 5th Ed. Upper Saddle River, NJ: Pearson Education.

[10] McIntosh, G.L., and Rima, S.D. (1997). Overcoming the Dark Side of Leadership: The Paradox of Personal Dysfunction. Grand Rapids, MI: Baker Books.

[11] Beck, A.T. (1979). Cognitive Therapy: And The Emotional Disorders. New York: Penguin Books.

[12] Beck, A.T. (1979). Cognitive Therapy: And The Emotional Disorders. New York: Penguin Books.

[13] Lewicki, R.J., Saunders, D.M., Barry, B., and Minton, J.W. (2004). Essentials of Negotiation, 3rd Ed. New York: McGraw-Hill.

[14] Lewicki, R.J., Saunders, D.M., Barry, B., and Minton, J.W. (2004). Essentials of Negotiation, 3rd Ed. New York: McGraw-Hill.

[15] Silberman, M., and Hansburg, F. (2000). People Smart: Developing Your Interpersonal Intelligence. San Francisco: Berrett-Koehler Publishers.

[16] Lewicki, R.J., Saunders, D.M., Barry, B., and Minton, J.W. (2004). Essentials of Negotiation, 3rd Ed. New York: McGraw-Hill.