Goals, Processes and Rationality:

A Parable and a Framework

Marc Le Menestrel
marc.lemenestrel@upf.edu

Sessions Menu

The parable of the Sadhu (discussion)

A Methodological Framework (lecture)

The Parable of the Sadhu

Attainment of goal is threatened by

unexpected event
Adverse decision-making conditions
Ethical dilemma between attainment of a
major goal and respect of a moral obligation
Human conflict in intensity of moral values
Difficulty in the (re)assessment of the goal
Breach of leadership responsibility

Goals and Success

Sometimes, goals are attained but reward

is not there
Sometimes, goals are not attained but
experience is gained and happiness is
felt
What is in success but beyond goals?

What is the rational path towards

genuine success?

What is Behavior?

It comes from an actor: an individual or a

group of individuals (e.g. a company);
It is a transformation of the world: an action
or a process;
It has an outcome: a consequence.

A Behavior is an Action with its

Consequences

What is Rational Behavior?

It is a behavior that is chosen intentionally

and purposefully by the actor;

Among the available behaviors, the rational

behavior is the preferred one.

How does an actor choose the

rational behavior?

The Consequence of choice

For each available action, the actor evaluates the

consequences for him/her;

The best consequence is identified, from the

point of view of the self-interest of the actor.

Is the action with the best

consequence for the actor the one to
be rationally chosen?

A Word from Common Sense

The end does not justify the means

The Process of choice

The actor may also prefer an action relatively to another,

because:

of some intrinsic pleasure in the action itself (virtue)

of some ethical principle that the action respects (deontology)

of the consequences of the action for others or for the

environment (altruistic consequences)

Ethical values help to identify and make explicit intrinsic

preferences over actions, as ends in themselves, beyond the
self-interest of their consequences.

Dual Analysis

?
Ethical
analysis of
actions

Self-interest
analysis of
consequences

The distinction between self-interest (of consequences) and ethics (of actions) is
somehow conventional
But it acknowledges the importance of self-interest as a motivation
And connects with the model of economic rationality

A Framework of Open Rationality

1.

Economic Analysis

2.

Ethical Analysis

3.

Ethical Dilemma

4.

Dynamic Analysis

1. Economic Analysis
Step 1: What is the action that leads to the best consequence for you?

Interest of the consequence

The rational actor (you, the team, the firm)

1. Anticipates the consequences of the available actions
2. Evaluates these consequences according to their interest for the actor
3. Identify the action that leads to the best consequence

2. Ethical Analysis
Step 2: What is the ethics of the action that leads to the best consequence for you?
?

To which extent is it unethical?

Emotions/Virtue:

To which extent is it ethical?

Do I feel bad?
Is this an unnatural way to act?

Deontology/Idealism:

Do I feel good?
Is this a natural way to act?

What sort of principle, rule or norm do I violate?

What happens if everybody does the same?
What happens if I always act like this?

Here you raise an ethical dilemma!

Deontology/Idealism:
What sort of principle, rule or norm do I
respect?
What happens if everybody does the same?
What happens if I always act like this?

Utilitarianism/Consequentialism:
What are the bad consequences for others?
Would I suffer these consequences for myself?
What are the bad consequences for the
environment?
Would the children of my children dislike these
consequences?

Emotions/Virtue:

Utilitarianism/Consequentialism:
What are the good consequences for others?
Would I like these consequences for myself?
What are the good consequences for the
environment?
Would the children of my children like these
consequences?

Here you justify your interest!

3. Ethical Dilemma
Step 3: Facing the extent to which there is a dilemma

Unethical
aspects of
behavior

?
More ethical
alternative

Prudence:
Vision:
Imagination:

Could the unethical aspects lead to unexpected negative

consequences?
Can you find a more ethical alternative?
If the consequences of the alternative affect your interest,
cannot they be improved?

The Dilemma of Buzz Mc Coy

Feel guilt
Leave the
Sadhu

all his life

Attain his goal

Bring the
Sadhu to his
monastery

Prudence:

Discover
Buddhism

Fail his goal

Vision:

Could Buzz have anticipated the reaction of Steven and the

guilt he will feel?
Could Buzz have envisioned bringing the Sadhu back?

Imagination:

Could Buzz have realized that this was an opportunity?

Open Rationality

Worse

Interest

Better

Ethical Values
Less ethical

More Ethical

Priority
to
interest

Ideal

Irrational

Priority
to
ethics

Rational choices between interest and ethics are often kept hidden, but
they are the most difficult:
We can rationally give priority to interest, and sacrifice ethics
We can rationally give priority to ethics, and sacrifice interest

4. Dynamics Analysis
Increasing demands (legal, social)
Credibility ambiguous
Contentment, lack of vigilance
Unawareness, rationalization

Lack of transparency
Legal pressure
Liabilities
Bad Reputation
PR costs
Negative motivation
Managerial inertia

If you give priority to

interest, you will
need reactive
strategies to survive

Priority
to
interest

Ideal

Irrational

Priority
to
ethics

If you are in the

ideal position,
you may not be
lucky for very
long

Transparency
Social involvement & support
New scope of activities
New business processes
Long term thinking
Strategic investment
Positive motivation
Learning process

If you give priority to

ethics, you may find
help for your
proactive strategies

A Difficult Strategy
Priority
to
interest

Ideal

Irrational

Priority
to
ethics

Few ones are going to believe it,

Outside or inside the company

A Reactive Strategy
Priority
to
interest

Ideal

Irrational

Priority
to
ethics

We wait for change to become necessary

But it can be very dangerous

A Proactive Strategy

Priority
to
interest

Ideal

Irrational

Priority
to
ethics

We are likely to be more credible,

And more motivated for change
Visionary Leaders Welcome!

Conclusions

It is easy not to see ethical dilemmas: you just have to

find a good justification for the action leading to the best
consequence!

It is not easy to see ethical dilemmas: it questions

ourselves and it does not look fun

It can be rational to be ethical sacrificing your interest, or

to sacrifice ethics for your interest: the choice remains
yours

It is difficult, but helpful, to search for ethical dilemmas

beforehand if you want to have a chance not to be
trapped by them and anticipate their dynamics

Next session
Accounting Practices: the Enron Collapse
Preparation:
What do you think of S. Watkins attitude and
behaviour? How would you blow the whistle?
Reading:
Watkins, S.S. Ethical Conflicts at Enron: Moral
Responsibility in Corporate Capitalism
Currall, S.C. & Epstein, M.J. , Lessons from the
Rise and Fall of Enron