Letter to the Queen

 

   One of my favourite UK bloggers, Rick at Flip Chart Fairly Tales recently accused me of writing bollocks when discussing the Walker Report into financial services corporate governance:  Here are some exerts of the exchange:

 

Jon: Financial services HR departments are partly if not largely to blame for the banks’ failures and therefore our current economic miseries.  And here’s a great opportunity for them to put the situation right.

 

Rick: The idea that City HR functions could have curbed the massive bankers’ bonuses, thereby reining in the risk taking culture and avoiding the financial crisis, is completely fanciful. People within the investment banks who warned that the industry’s practices were unstable and unsustainable were ignored for the same reasons as those politicians who advocated bank regulation at the height of the boom. Lots of people were making lots of money and anyone who suggested caution was looked upon with the same contempt as the swotty teetotaller at a student party.

 

Jon:I still don’t agree with you though – it was down to HR to ensure these organisations’ cultures DID enable this sort of challenge and debate.

 

 

I think my perspective is supported by the recent  letter sent by a group of economists to the Queen explaining why no one foresaw the timing, extent and severity of the recession.  The letter tells of the "psychology of denial" leading to "a failure of the collective imagination of many bright people".

One of the most critical things that HR can do is to develop an environment in which people are able to challenge each other and to take effective decisions, as individuals, and as groups, within our organisations.

And I find it immensely interesting that within ‘behavioural economics’, there is a clear move within this field towards incorporating the way people take often illogical decisions into account, often being informed by on findings from neuroscience.   But there’s very little sign of a similar developments within HR (which you might have thought would be much more easily influenced by things which have a direct influence on people management).

Where is ‘behavioural HR’?

 

 

Technorati Tags: Tim Besley,Peter Hennessy,economists,Queen,behavioural economics,HR

 

 

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