Rationality
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Transcript of Rationality
Session’s 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.
?
Ethical analysis of
actions
Dual Analysis
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
The rational actor (you, the team, the firm)1. Anticipates the consequences of the available actions2. Evaluates these consequences according to their interest for
the actor3. Identify the action that leads to the best consequence
Interest of the consequence
?
Step 1: What is the action that leads to the best consequence for you?
2. Ethical Analysis
To which extent is it ethical?
Emotions/Virtue:Do I feel good?Is this a natural way to act?
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 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?
To which extent is it unethical?
Emotions/Virtue:Do I feel bad?Is this an unnatural way to act?
Deontology/Idealism: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?
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?
Step 2: What is the ethics of the action that leads to the best consequence for you?
?
Here you raise an ethical dilemma!
Here you justify your interest!
3. Ethical DilemmaStep 3: Facing the extent to which there is a dilemma
Prudence: Could the unethical aspects lead to unexpected negative consequences?
?
Unethical aspects of behavior
More ethical alternative
Vision: Can you find a more ethical alternative?
Imagination: If the consequences of the alternative affect your interest, cannot they be improved?
?
?
The Dilemma of Buzz Mc Coy
Prudence: Could Buzz have anticipated the reaction of Steven and the guilt he will feel?
Leave the Sadhu
Bring the Sadhu to his monastery
Vision: Could Buzz have envisioned bringing the Sadhu back?
Imagination: Could Buzz have realized that this was an opportunity?
?
?
Attain his goal
Feel guilt
all his life
Fail his goal
Discover
Buddhism
Open Rationality
Less ethical More Ethical
Bet
ter
Wor
se
Ethical Values
Inte
rest
Ideal
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 ethicsWe can rationally give priority to ethics, and sacrifice interest
Irrational
Priorityto
interest
Priorityto
ethics
4. Dynamics Analysis
Ideal
If you are in the ideal position,
you may not be lucky for very
long
Irrational
Priorityto
interest
Priorityto
ethics
Lack of transparencyLegal pressureLiabilitiesBad ReputationPR costsNegative motivationManagerial inertia
TransparencySocial involvement & supportNew scope of activitiesNew business processesLong term thinkingStrategic investmentPositive motivationLearning process
Increasing demands (legal, social)Credibility ambiguous Contentment, lack of vigilanceUnawareness, rationalization
If you give priority to interest, you will
need reactive strategies to survive
If you give priority to ethics, you may find
help for your proactive strategies
A Difficult Strategy…
Few ones are going to believe it, Outside or inside the company…
Ideal
Irrational
Priorityto
interest
Priorityto
ethics
A Reactive Strategy…
We wait for change to become necessary
But it can be very dangerous…
Ideal
Irrational
Priorityto
interest
Priorityto
ethics
A Proactive Strategy…
We are likely to be more credible,And more motivated for change…
Visionary Leaders Welcome!
Ideal
Irrational
Priorityto
interest
Priorityto
ethics
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 “