School of Business and Law

Inspiring journeys to work

If the Brexit-addicted government were a small business it wouldn’t last a year

Paul Levy, University of Brighton

The march towards Brexit seems relentless. Theresa May urged people to vote to stay in the EU but she knows the political cost of rowing back back from the referendum result at this stage. When a High Court judgement appeared to put a spanner in the works, the prime minister was quick to assure European leaders that the plan to trigger the exit process in Spring 2017 had not been derailed. This is an interesting metaphor. Rails are fixed, and once you run along them you are committed to where they go. But can being too wedded to a decision do more harm than good?

In looking at how businesses of all sizes and in many sectors survive and thrive over the last 25 years, we’ve found there are common behaviours and attitudes. Flexibility in decision making is a key factor, based on an openness to changes in the environment in and around the business.

The ability to sense change; to adapt quickly and cleverly are crucial to being a successful innovator. Innovators don’t just adapt in terms of how they manage and what products and services they offer, they are also able to quickly and humbly reverse decisions that no longer make so much sense as the world changes around them. Fixed, dogmatic decisions create death in businesses.

fernando butcher/Flickr, CC BY

Flexible friends

The regularly invoked phrase, “the British people have spoken”, is a troubling one from the point of view of flexibility. Referendums are clunky and risky when complexity exists and when environments are volatile. The majority in that vote was relatively small and the conversation is clearly not over. New information is coming to light, new impacts and consequences are emerging that weren’t clearly known at the time. In a small business, the owner or the board would ignore such volatility at their peril.

The government says it is determined to respect the referendum results. And even if the legal arguments end up handing a vote to parliament before Article 50 can be triggered, MPs currently seem likely to respect the original vote. Political pressures have a habit of changing, however, and there will be likely be fierce lobbying from constituents who have rethought – that “things have changed since that vote years ago”. When customer preferences change, suppliers would be crazy to ignore those changes.

Just around the corner?
RachelH_/Flickr, CC BY

The longer parliamentary scrutiny runs, the closer we will be to general election. The government’s temporary monopoly on democracy will have unravelled into fears of losing power. Under similar conditions of uncertainty a small business would simply adapt and change, opening itself up to new ideas and possibilities. Committing to a decision, seeing things through, can be the right thing to do in some circumstances. In the light of opposition, tenacity can be a mark of good leadership. But that tenacity can become a fatal bloody mindedness when uncertainty or new information demands a genuine and honest revisiting of an earlier choice.

Dogma tired

If the UK government were a small business then we would be forced to ask if its leader and board were being more dogmatic than tenacious? Why do I ask that? Because those calling for the Brexit decision to be revisited are not all partisan opposers. New, credible, information has come to light which would inform a rethink by British people in both camps – we now know that sterling does indeed go into freefall, and that recession doesn’t appear to bite immediately. Even one of those who originally penned Article 50 is pointing to the reversability of the Brexit decision.

There is also evidence that many who voted in the referendum feel they didn’t have access to honest information at the time on which to base their free decision. Many are reported to feel duped or manipulated. One academic even claims the Leave campaign behaved with criminal irresponsibility. Leave campaigners are also able to point to holes in what they had labelled as the Remain camp’s “project fear”.

A pounding.

There are now new forecasts about the impact on our economy and our currency and even on the implications for UK citizens needing visas to travel into Europe. Clearly the picture could be radically changing. The notion of acting on an ever more outdated snapshot decision is akin to a business acting as if interest rates have not been cut, or relying on last year’s forecast for oil prices. Such behaviour is the road to ruin.

Many in government have confused strong leadership with sticking to decisions regardless of external or internal change. Such behaviour has killed many a business. It results in a failure to innovate, a hesitancy in questioning decisions that no longer make the same sense they did at the time they were made.

This doesn’t mean that the referendum result should be ignored or reversed. However, if we are to learn from the analogy of a fleet-footed small business which is innovative, flexible, and ultimately successful, it makes sense to review major decisions on an ongoing basis. This is what learning organisations do. Dogmatism can be corporate death. Small businesses change in order to survive. Successful ones are humble enough to let go of decisions that no longer hold true. The UK government operates in an equally changing environment, and “Brexit means Brexit” might just be one fixed decision too many.

Paul Levy, Senior Researcher in Innovation Management, University of Brighton

This article was originally published on The Conversation. Read the original article.

The Conversation

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Clare Prust • November 8, 2016

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