Exploring organizational theory and leadership through the framework of complexity and neural sciences (part 2)

On 9:th of September we launched the first blog post as an introduction and first part of a paper where we are exploring the sciences of certainty and how concepts of linear change, reductionism and determinism relate to today's managerial sciences. As we walk through the history of thought – shaping our perception and patterns of thought still today – we approach the world of nonlinear dynamics and complexity sciences to illuminate the core dynamics of complex systems, suggesting dynamical analogies to better describe the social reality we’re experiencing and finally enabling researchers or practitioners to discover new ways of seeing and asking questions related to organizations, change management and leadership phenomenon in generally. In this post and following chapter we’ll focus on the aspects of psychology and sociology to understand the human picture embedded in today's dominant paradigms of leadership and organizational theory. We’ll review the theories of behaviorism, psychoanalytic psychology, humanistic and cognitive psychology and eventually process sociology and symbolic interactionism and develop understanding why this is crucial in terms of leadership and organizations. We hope you enjoy the journey !

Effective management it’s said to steer and coordinate the generation greater returns for the organization, optimum use of the company’s resources, healthy work environment, motivated and productive workforce. Effective management also enables business expansion and diversification, satisfied customers at the same time securing the organization’s lead amongst its competitors. Today’s business environment is characterized by a growing international competition, need for shorter product and service life cycles, better educated and quality-conscious consumers and stricter government policies. There’s also greater pressure related to environmental and social responsibilities and rapidly advancing capabilities of new technology such as AI and machine learning, all placing immense pressure on management to steer the organization in a profitable direction. There’s a saying that though the workplace is often perceived as a logical, transaction-based environment, it is still occupied by humans—and we humans are emotional beings. Let’s take a deeper review of what this means for our intellectual journey.


Psychology is the scientific study of people’s behaviour and their mental processes and is concerned with how people act, think, reason, and feel as individuals and also as participants in a group situation. It studies also how mental processes and behaviour are influenced by internal (mental) processes and the (external) environment. The goal of psychology is to describe, understand, predict and modify behaviour. Psychology classifies and studies a range of both abnormal and normal behaviours and human interactions or simply how humans perceive and react to the world around them. Furthermore, it helps to give insights and deeper understanding of how and why the mind works in a particular way and explains one’s emotions in a logical manner which is useful in understanding why people think and act in a certain way. In psychology there are different ways of explaining the human mind and behaviours – as individuals and as part of the group (social and group psychology). These different ways are known as schools of thought in psychology. Over the course of history, the different schools of thought have competed for prominence and each presenting a different perspective to describing and understanding the human mind and behaviour.

Behavioural psychology, also known as behaviourism, was one of the first theories and is based upon the idea that all behaviours are acquired through interaction with one’s environment. According to behaviourism, all behaviours are learned and therefore behaviour can be studied in a systematic and observable manner with no consideration of internal mental states. Edward Thorndike (1874-1949) and John Watson (1878-1958) can be considered the "fathers" of American behaviourism. Besides the American school of behaviourism Russian physiologists Ivan Pavlov’s work in classical conditioning was influential behind this school of thought.




Psychoanalysis is a method of studying and understanding the human mind based on investigating the role of the unconscious mind. Sigmund Freud (1856-1939) was the founder of psychoanalysis and the psychodynamic approach to psychology. Later on, his student Carl Jung expanded these ideas towards analytical psychology. Psychoanalysis is based on the concept that individuals are unaware of the many mental factors that cause their behavior and emotions. Freud believed that people repress dangerous desires and painful memories causing potential shame and psychosocial disapproval, but this does not get rid of such desires and memories, they remain in the unconscious mind as determinants of the person’s behavior (Stacey et al, 2007). These unconscious emotional underpinnings and their derivates to individuals and group’s mental life and behavior cement the foundation of psychodynamic thinking. Freud recommended that the analyst or doctor swims to the unconscious emotional world of a patient with transference and countertransference. Analyst or doctor would then assimilate container function and open the hidden symbolism behind neurotic or even psychotic forms of projection, splitting, resistance and other unconscious acts and clarify these unconscious factors in a process known as intervention. Freud believed that once the patient was confronted with these issues that it would somehow help him overcome and eventually enable him to change his behavior (Freud, 1989). Neurobiological perspective to such a container-function (Bion et al.) means psychologist supports the patient in creation of a mental state, in which ultimately physiological stimulus based external and internal mental sketches can be digested and tamed by physical level processing and re-modularization, a kind of psychic digestion (Lehtonen, 2011).



During Freud's research he discovered that in order to understand the function of the human psyche, it's not enough to stipulate the brain chemistry and environmental stimulus-oriented approach of behaviorist personality theory, but one must understand the far more complex nature of the human mind. In Freud's approach the conscious and unconscious mental worlds – the subterranean – intertwine in a dynamical and complex process of interaction. Based on this fundamental notion, Freud developed the psychoanalytic and psychodynamic human picture and personality theory, which replaced the paradigmatic position of brain chemistry with a person's psycho-historical background and its development. Freud suggested that the birth of superego is strongly integrated to the oedipal complex and its abandonment. When at infantile stage the infant feels surrounding objects as fully integrated and subjected to her- or himself, as for example mothers breast as an object just for satisfying infant’s needs, when ego and superego later develops the infant takes the norm and value realities of adults and other significant persons as part of her own view of reality. As ego is dealing with the primitive impulses arising from Id, it's at the same time using defense mechanisms to protect consciousness from too strong morality cumulating from super-ego (Freud, 1989).

Psychoanalytic perspective has also been applied to groups and group dynamics. Wilfred Bion was one of the pioneers of this way of thinking and he developed three basic assumptions about the emotional states of a group (Bion, 1961). Bion argued that in every group, two groups are actually present: the work group, and the basic assumption group. The work group is that aspect of group functioning which has to do with the primary task of the group i.e. what objects the group was formed to accomplish. The basic assumption group describes the emotional atmosphere of the group or the underlying assumptions on which the behavior of the group is based. In most cases these assumptions are unconscious and unspoken and only come to light when a crisis or uncertainty raises the group's levels of uncertainty. This basic assumption group is always present but when the levels of anxiety rise, it may hinder the group from carrying out its primary task which is the work group aspect of the group. This basic assumption group is very similar to the unconscious processes or forces that can be influencing an individual’s behavior (i.e. Freud, Jung). Primitive-irrational forces and fantasies are key concepts when thinking of basic assumption groups (Bion, 1961). According to Bion, while interacting as members of a group, people are forming a kind of supra-individual whole - a system, which is affected by and which affects individuals forming it. As in individual level psychoanalysis, the key concept is the uncertainty, anxiety and shame driven regressive behaviour, operating through defence mechanisms such as projection and splitting. The counterpart for this phenomenon in group psychoanalytic and psychodynamic approach is group level regression, that is to say the basic assumption groups.  In day-to-day organizational activities there are situations when uncertainty gives rise to anxiety, as is the case when definition and boundaries of tasks are not clear, time allocation and resources are inadequate, management structure is unclear and economic situation is dubious. This is the soil which Bion and later academics, consultants and managers applying psychoanalytic and psychodynamic approach to group behaviour and organizational theory consider as a ground for irrational behaviour (Bion, 1961). 


Bion specifically identified three basic assumptions: dependency, fight-flight, and pairing. In dependency, the group behaves as if it has come together to depend on some leader, as an example they seek a leader in whom they can depend on. In this assumption the essential aim of the group is to attain security and have its members protected by one individual. The group members abandon their individuality and behave passively, acting as though the leader, by contrast, is omnipotent and omniscient. For example, the leader may pose a question only to be greeted with docile silence, as though he or she had not spoken at all. The leader may be idealized into a kind of God who can take care of his or her children, and some especially ambitious leaders may be susceptible to this role. Groups working on this assumption are destined to disintegrate because in most cases the expectations the group has for their leader are completely unrealistic and the person is destined to fail or resentment builds among another member of the group who subsequently convinces the rest of the member to “overthrow” or “taken down” the current leader in favour of a new leader to repeat the process. This particular basic assumption is very evident in many Presidential elections where leadership oscillates between the major political parties depending on the favoured candidate in a particular election year (Bion, 1961).

In the basic assumption of fight-flight, the group behaves as though it has met to preserve itself at all costs, and that this can only be done by running away from someone or fighting someone or something. In this group a lot of their energy goes into competition and win/lose dynamics instead of focusing on their primary tasks. In fight, the group may be characterized by aggressiveness and hostility; in flight, the group may chit-chat, tell stories, arrive late or any other activities that serve to avoid addressing the task at hand. Members in this basic assumption group project their desire for fight or flight on to someone to lead them and the leader has to be one who can mobilize the group for attack, or lead it in flight. Neural basis of fight or flight reaction is that the hypothalamus activates two systems: the sympathetic nervous system and the adrenal-cortical system. The sympathetic nervous system uses nerve pathways to initiate reactions in the body, and the adrenal-cortical system uses the bloodstream. Once again members of this group may easily and rapidly become dissatisfied and disappointed with their leader and end up taking him down like in the first group (Stacey et al., 2007).

The final basic assumption group, pairing, exists on the assumption that the group has met for the purpose of reproduction. Two people, regardless the sex of either, carry out the work of the group through their continued interaction. The remaining group members listen eagerly and attentively with a sense of relief and hopeful anticipation. The atmosphere here is one of unrealistic hope that some experts will produce all the answers and solve all the groups problems and issues. A fourth assumption was added in 1974 by Pierre Turquet (Turquet, 1974). This is the basic assumption of ‘oneness’ where the group acts as though it has come together to join in a powerful union with some omnipotent force that will enable members to surrender themselves in some kind of safe passivity. In this case members seem lost in an oceanic feeling of unity. (Stacey et al., 2007). When a group adopts any one of these basic assumptions, it interferes with the task the group is attempting to accomplish. Bion also stated that if people in groups do not have well defined tasks, responsibilities, roles, managers etc. they will get regressive and adapt to certain behavioural concepts which they have learned from their childhood (Bion, 1961).

When combining the theory of psychoanalysis with the ideology of later systems thinkers, what we have is the so-called socio-technical approach to organizational theory, practiced by Tavistock Institute and Society of Organizational Learning (SOL). This theory is considering organizations as dynamical systems and highlights the concept of learning organization. In these traditions the task of management is typically defined as regulating boundary conditions of organizations in individual and supra-individual level. Besides the regulating function, identifying effective ways for systemic intervention. Although these theories have developed well over the linear concepts of scientific management and stimulus-response based human picture of behaviourism, we can clearly identify the problematic Kantian split between intra or supra system following the formative teleology, and the researcher or a leader the causality of rationalist teleology.


Humanistic psychology developed as a response to psychoanalysis and behaviourism as humanist thinkers felt that both were too pessimistic, either focusing on the most tragic of emotions and failing to take the role of personal choice into account. Humanistic psychology focuses on an individual’s free will and potential, personal growth, and self-actualization. This school of thought offers an optimistic view of human nature and the fundamental belief of humanistic psychology is that people are innately good, with mental and social problems resulting from alienation from his or her own true self. Here among the most influential thinkers was American psychologist Abraham Maslow (1908-1970) who was best known for creating Maslow's hierarchy of needs, a theory of psychological health predicated on fulfilling innate human needs in priority, culminating in self-actualization. This much more recent psychological school of thought emphasizes the importance of values, intentions, and meaning in the individual. The underlying idea of fulfilling the embedded potential and aspirations follows closely the idea of formative teleology.

Sociology is the study of human social life, groups and societies. It is the study of how humans interact within the structures of groups, organizations and/or societies with the aim of understanding human behaviour. Process sociology, also known as figurational sociology, is a school of thought that seeks to understand and explain how the thought, feeling and behaviours of individuals are influenced by their interaction with other human beings. These local (micro level) interactions are constructing what emerges as larger-scale social outcomes, or (macro level) patterns. Process sociology has been strongly influenced by the work of German sociologist Norbert Elias (1897-1990) and his theories of civilizing/decivilizing processes. Elias spoke of the person as social through and through and of the social being the plural and the person being the singular of the same process of relating (Shaw, 2002). The central concept of this approach is the dynamic web or relationships of human beings, their interdependence with each other (Elias, 1978). Elias argued that each and every person is linked to others with invisible ties (Elias, 1978, 127) and consequently an individual should not be thought to be separate from society as they are part of each other. This approach also emphasizes that one must start from the structure of the relations between individuals in order to understand the psyche or mind of an individual (Elias, 2001).

George H. Mead (1934), one of the pioneers of symbolic interactionism, described the human mind and social organizations in terms of symbolic interaction. Mead argued that all social animals, including humans, communicate with each other through a conversation of gestures: movement, touch, sound, visual display and odor. According to Mead, a symbolic interaction consists of a gesture and a response. A gesture is a symbol in the sense that it points to a meaning which becomes apparent in the response that it calls forth. Together the gesture and its response constitute a social act and its meaning is “constructed” for both. Social acts are not in isolation of each other, since each gesture is a response to some previous gesture and so on. The gesture–response model describes communication as actions of human bodies, that is, facial expressions, postures, vocal gestures and so on. Each gesture calls forth a response from another and together, gesture and response constitute a social act, that is, an act that is meaningful to those gesturing and responding (Stacey, 2000).

The meaning emerges in the interaction and therefore lies in the whole social act of gesture-response pattern. Meaning is not attached to an object, or stored, but repeatedly created in the interaction. In other words, it is not simply located in the past (gesture) or the future (response) but in the circular interaction between the two in the living present. Important notion here is that it’s this interactive process of social acts, and it’s intersubjectivity, which gives rise to social self and identity. Here the theory doesn’t require any Kantian split of human and human system but follows the Hegelian both/and dialectic. The meaning is both maintained and transformed throughout the social act where the future is under perpetual dynamic construction. The gesture calls for a response, where the response has an influence of the interpretation (meaning) of the gesture. This means shifting to process instead of systems perspective and a very different notion of the arrow of time. It is in this local process of interaction and sense making which gives raise to the potential new ways of acting and thinking to emerge. This is also the source of the inherent novelty and what is called as Transformative Teleology.

This symbolic interaction approach is very far away from the sender-receiver model. In contrast to the gesture-response model, in the sender–receiver model (Shannon–Weaver) an individual (the sender) transmits an idea from his own head to another individual (the receiver) who, in turn, decodes the message in his/her own head to grasp what the sender was trying to send. This model assumes that the receiver will understand the message or idea transmitted in the same way that the sender understands it. The gesture–response model does not require any translating or decoding and it does not make any assumptions about the “inner worlds” of individuals. Instead it gives the receiver an opportunity to retransmit what he/she understood back to the sender in the form of response and the sender can then evaluate if the receiver has actually understood the initial message clearly. If the sender feels that the receiver did not clearly understand he/she then responds again to clarify and the loop continues until they are both satisfied with the outcome and meaning of their conversation (Stacey et al., 2000).

As a summary of the 2:nd chapter:

  • Organizations have evolved to solve problems by accelerating socio-biological interactions. The COVID-19 pandemic has created discontinuation of our social fabric and phase transition to digitalized work.
  • Several schools of psychology have embedded reductionistic ontology and the historical alignment with the scientific management and systems thinking is clear. Our social reality involves uncertainty and is always affected by physiological and emotional  states creating a specific context in which we operate and need to make decisions.
  • Humans are throughout social animals, with social preferences and social matters are primarily intersubjective. Considering the social nature of human beings and seeing human work as contextual interaction between interdependent people generates more accurate understanding of organizational life and dynamics. Besides the social processes, there’s a mental subterranean system of unconscious emotions also steering our behavior in both individual and group level.

Rethinking our understanding by exploring the theories of psychology and sociology enables us to learn more about our own agency. Thank you for reading and the journey continues again after two weeks !

BlackSmith Consulting Oy, Juho Partanen
Chairman of the Board
+358 40 153 5606