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Cavemen to C-Suite - The Impact of Evolutionary Psychology on Business

Throughout their evolutionary past, humans have been an adaptive breed, forming the alliances and allegiances necessary for the survival of the species. Here we link evolutionary theory with psychology to explore the insights as to how we behave in business especially during challenging economic conditions.

I know what you’re thinking. What on earth has our evolutionary history got to do with the way we behave in modern business? But I ask you, do we really understand why we make the decisions we do in our working lives? By doing things that are natural to us and which we are hardwired to do because of our evolutionary history, we are potentially damaging our business today. And if we understand what we are doing and why, we can work to reduce some of the trappings of the past.

The lessons of our evolutionary journey have become part of the way we operate and are translated into the activities of today’s leadership teams

Over the millions of years that humans have been evolving, a tiny proportion of our evolutionary journey has been spent in the environment that we now recognise as ‘business’. We have evolved and adapted in an environment where survival was dependent upon our quick reading of risk and opportunity, the agility of our growing mind and our ability to organise as a cohesive focused group.

In short, the lessons of our evolutionary journey have become part of the way we operate and are translated into the activities of today’s leadership teams. We can observe the evidence of this in our colleagues and in the businesses within which we operate. The innate response and its potential impact on our businesses during the current economic climate gives us an idea of what can be learned if we view such activities through the lens of Evolutionary Psychology (EP).

As an applicable study, EP is still in its infancy. Yet, just as the notion of emotional intelligence became mainstream when assessing leadership skills at the turn of the 21st century, EP is establishing itself more and more strongly in the way we think about how organisations operate. It is shaping and extending our knowledge to the point where we begin to ask, “How can we apply it?”

What is Evolutionary Psychology?

At the very simplest level EP is the application of evolutionary theory to psychology: how and why over time people behave the way they do. And what we are really concerned with is cognitive psychology and the impact upon behaviour. The basis is that our actions are caused by mental processes and that the mind is a set of operations for processing information. If we were to look at this using the metaphor of a computer, we could describe the brain as the hardware and the mind as the software. In the language of EP each element of software is termed a ‘module’.

To get a handle on this we also need a basic understanding of evolution, heredity and mutation. The basis for this is adaptation to enhance survival and success through the process of natural selection. For more on the process of heredity, genetic coding and beyond, see Mendel’s work on garden peas (and simple inheritance) or delve into Richard Dawkins’ thinking in ‘The Selfish Gene’.

If we join these ideas together it is possible to identify the activity of natural selection upon the on-going development of primates over the last 60 million years or so, leading to the appearance of the first true humans (Homo sapiens) some 200,000 years ago. Among the many adaptive mutations that have taken place over this time are those concerned with human behaviour, particularly related to natural co-operation with the associated advantages and benefits provided to the survival of the human species. The gene is seen as a self-interested strategist focused on replication within its carrying vehicle - the species - and in this case, humankind.

While we can acknowledge the action of genetic inheritance on hair colour or height, and we can accept the notion of inheritance in terms of intelligence or specific talents - for example, music or language acquisition - it becomes harder when applied to human conditions and behaviours such as depression, anti-social behaviour or deception. Yet, within this last category, there is clearly a well proven genetic content.

To truly understand EP, we must avoid the belief that a gene exists ‘for everything’. The causal pathway between multiple gene sequences, through variations of protein chemistry and wide ranging environmental experiences and conditions is enormously complex. Having the gene sequence that predisposes a particular behavioural trait may be a necessary requirement, but it is not in itself sufficient for the behaviour to be displayed.

Applications for business

When discussing EP, we’re also talking about awareness. In the process of increasing our understanding of what happens in human behaviour in an organisational context, one of the benefits we get from EP is the recognition of why allegiances, coalitions, alliances and power bases form and exist within small groups of people.

[A benefit of] EP is the recognition of why allegiances, coalitions, alliances and power bases form and exist within small groups of people

Of course, the benefits of operating within a collective are the security that we’ll be cared for and the notion that many hands make light work. But size matters, too. According to studies, we are predisposed to operate most effectively within a unit of 150 people. This is ‘Dunbar’s Number’, it is prone to some slight variance (personality, individual differences, early nutrition, rearing experiences, and - specifically - gender) but is predictable for modern humans.  Above 150, things get a lot more complicated. Below it, we don’t quite have the benefits associated with living in society (although we obviously function to some degree in family and kin groups which are much smaller).

There are four aspects of social alliance through which we can apply the lens of EP:

Social accounting

This is where I do something for you and you give it a cost, a value in your head. I don’t know what value you’ve given it, but my expectation is that you will do something for me of equal value. That’s the rule. And this is one of the modules that exist in the way that we operate. We do something for each other that will be measured in equal value, whatever that value is when it’s translated. And it’s likely to happen - unless one of us is a free rider.

Cheating

Free riders will align themselves to our coalition and will have an expectation of getting results. If we’re not getting benefits from their contribution, but they are, we don’t like it. So, we have a method to deal with them associated with punishment and reward. The reward is the benefit you get from contribution; the punishment is that we will alienate you over a period of time. In evolutionary terms it isn’t worthwhile being a free-rider because you’ll become distanced from your group and you lose all the benefits. In organisational terms, you can get by with it if you play your own political game effectively, but you won’t receive all the benefits that people are getting if they’re engaging in a much more cohesive, collective way.

Reciprocal altruism

This is about what I’m willing to give freely in our group, my contributions. When working with people in organisations, very often people don’t realise the benefits that could be had across boundaries. Organisations tend to encourage us to hang our personality at the entrance and assume the jacket of the organisation, so we start thinking in a structural rather than emotional sense. Subconsciously, this makes it easier for us to stop thinking about what happens when we work across those boundaries, if we engage in activities that help other people. This might manifest itself in developing an understanding with cross-boundary suppliers or supplier-customer relationships in organisations. Sometimes people don’t even bother to ask the way that their customers want information rather they stubbornly hold faith in the way they do it. Reciprocal altruism is the whole business of engaging in the conversation, getting a clear understanding, not just of the rational but also the emotional aspects, of what takes place across these boundaries and how, therefore, my gifts can be gifts that fit the need of the business.

Power

Authority is one thing because that’s given hierarchically, but power is something else. Power is the application of authority and you don’t need to be in an authority position to wield power. Take the CEO’s personal assistant, for example. This is about being aware of where power bases lie and building up the alliances and the relationships that are associated with that. Not from a negative political perspective, where I’ve set myself an agenda to climb the career ladder, rather from the positive approach whereby I’m setting out to enhance the performance and operation of this business - while at the same time not harming my own career prospects.

Survival of the fittest

In organisations, particularly during periods of economic downturn, people are adjusting themselves all the time to survive. But survival is mediocre compared to thriving. We must discover the conditions required to get the best out of people, because these are the conditions that will drive positive change.

We must discover the conditions required to get the best out of people, because these are the conditions that will drive positive change

In the context of EP we know when there’s a lack of food, people need to adapt; in evolutionary terms these adaptations may be good for the survival of the species but they are often damaging to people. This condition is known as ‘scarce resources’. It is directly akin to the stimulus caused to businesses by the credit squeeze and economic stagnation. The consequence is that it causes behaviours in us that may not be beneficial to us, our people, our businesses or, indeed, the economy itself.

As individuals we have a scarce resource module pre-loaded in our minds, operating at different levels. The current economic climate switches on this module, one of the effects of which can be seen in how people operate in the boardroom. From the EP perspective, what we’re focusing on when using this scarce resource module is the here and now: the application of short-term thinking.

Over the last couple of years we have seen the behavioural responses of executive boards as the ‘scarce resource module’ has come into play. The focus shifts from strategy and direction to the immediate tactical operation of the business. Moves that were previously seen as low risk are now high risk - and to be avoided. Activities that drove the business forward - and that may be even more important in this situation, such as increasing visibility, developing skills of senior executives and planning for expansion - are reduced, halted or shelved. The key words are cost-cutting, capital security and reducing headcount.

Among board and executive board members relationships change. Trust reduces, coalitions and alliances form. Likewise personal agendas and territory defence becomes increasingly important. And what happens at the top spreads through the organization.

Let’s consider headcount reduction as one of the typical direct reactions to scarce resources.  In the first instance, this causes understandable division in the organization. The process of reducing head count must a basic human requirement of being seen to be ‘just’ (transparent in operation and fair in selection), yet it is often the case that because of the fear generated by the reaction to the ‘scarce resource module’ cost saving is seen to be more important than justice. So the process does not meet the human requirements and causes division, low morale, poor trust and lowers performance.

Furthermore, one of the first things an organisation often does after reducing headcount is to organise team-building events. The object, of course, is to try and rebuild morale. But this is dangerous because the moment you set out to do a team-building event within an organisation that’s shedding staff, you’re reinforcing security at a local departmental level; in short, you’re building tribalism.

The fears of employees concerning their own job loss, combined with the guilt of survival, distrust of senior management and the damage to what they believed was their organization operating in a fair way, creates the development of local bonds. Security is with the people we know, who make up our team; our trust is in our colleagues and our manager - rather than the organization itself.

In the end, the intention to increase morale and reinforce social cohesion actually has the effect of increasing morale at the local level through the creations of fractures and divisions, but decreasing overall organisational cohesion.

So where does all this take us? The answer lies in knowing and assessing our stereotypic behavioural responses, and in controlling the ‘natural’ response. Instead of behaving the same way as other businesses, and especially competitors, this may be an opportunity to resist the inherited behavioural response and consider alternative adaptive behaviours.

Metaphorically, this may mean enabling, allowing and guiding our businesses to ‘mutate’, which, because it goes against what seems natural, won’t feel comfortable. But as HG Wells once said: “Adapt or perish, now as ever, is nature’s inexorable imperative.”