What is it about?

Outsider executives, i.e. executives who have come to the office from managerial jobs in other domains/industries, lack much of insiders' local knowledge. To maintain authority they conceal this lack but then retain it, causing mistakes and failures.

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Why is it important?

Importing outsider CEOs and executives is common but the literature missed the questions concerning their unique knowledge gaps, that is gaps in subordinates' know-how and phronesis which they would not convey to distrusted superiors who avoid exposing/admitting ignorance. Only a minority of the outsider executives studied high-morally behaved otherwise, by active involvement in subordinates' deliberations exposed knowledge gaps, created full mutual trust, enjoyed conveyance of subordinates' unique knowledge and phronesis (Greek for practical wisdom) and successfully managed.

Perspectives

Today much specialized knowledge is essential for organizational success, but a large part of it is uncodified nor learned in business schools; only specialized on-the-job experience teaches this phronesis. Outsider executives lacking organization-specific experience cannot get it from subordinates without admitting it, becoming vulnerable by active involvement in the deliberations, and gaining their full trust. This tends to happen where executives are high-moral, explaining why most low-moral ones often mismanage even if successfully managed in a previous job in which they were insiders.

Doctor Reuven Shapira
Western Galilee College

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This page is a summary of: Contextualizing Gin Plants’ Mismanagement in the Kibbutz and Israeli Fields, February 2017, Taylor & Francis,
DOI: 10.4324/9781315206028-6.
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