- Author
- Sharam Kohan
- Year
- 2019
- Pages
- 251 (~62,000 words)
- ISBN
- 979-8-234-02650-7
- Format
- E-book
The Honest Organization
Behavioral Economics, Self-Concept Maintenance, and the Architecture of Organizational Self-Deception
Core Argument
The book argues that organizational dysfunction does not arise from a lack of information. Organizations that promote the wrong people, silence internal critics, tolerate toxic culture, and accumulate legal liability are not uninformed. They are structurally prevented from acting on what they already know. The mechanism is self-concept maintenance: the set of cognitive and motivational processes by which individuals and organizations filter, reframe, and suppress diagnostic signals that threaten a settled self-image.
The author synthesizes behavioral economics, Kahneman and Tversky's prospect theory, motivated reasoning, escalation of commitment, dual-process cognition, with twenty-five years of direct practitioner experience, including as the HR Director of a multi-entity organization operating across California and Arizona, and as a consultant to organizations across healthcare, technology, energy, hospitality, and the nonprofit sector.
The book delivers both diagnosis and remedy: a structural design blueprint of specific, implementable interventions for hiring, promotion, employee relations, compliance, and governance that constrain self-defeating organizational behavior without relying on individual awareness or good intentions.
What Makes This Book Different
Most organizational behavior books diagnose problems in terms of culture, leadership, or information. The Honest Organization argues that culture is a consequence, not a cause, and that information is available but structurally blocked. It is grounded in peer-reviewed behavioral economics research, Kahneman, Tversky, Lazear, Benson, Ariely, and others, while drawing on a practitioner's firsthand account of how these dynamics operate in real organizations. It provides a named, rigorously derived theoretical framework and concludes with a concrete structural design framework rather than motivational exhortation.
Who This Book Is For
Chapter-by-Chapter Overview
Introduces the gap between available information and organizational response. Examines the failure of the rational actor model and the behavioral revolution in economics. Establishes the six domains where organizational rationality fails most consequentially.
Constructs the complete theoretical framework: self-concept maintenance theory, prospect theory and loss aversion, motivated reasoning, and escalation of commitment, demonstrating how the four mechanisms interact to produce systematic organizational dysfunction.
Reframes the Peter Principle through behavioral economics. Introduces the Incompetence Ratchet. Explains why demotion feels psychologically impossible under prospect theory, and how motivated reasoning distorts performance evaluation of promoted managers.
A detailed case study in which all four mechanisms operate simultaneously in a real organizational crisis, ending in the termination of the person brought in to correct it.
Examines how organizations label complainants to dismiss diagnostic signals. Analyzes the grievance process as a motivated reasoning exercise. Explains why the organizational immune response predictably generates retaliation claims.
Argues that culture is an emergent property of accumulated self-concept maintenance episodes, not an independent cause. Explains why culture change initiatives systematically fail.
Reframes low morale as a symptom of organizational self-deception. Examines the engagement erosion trajectory and the engagement industry as reform theater.
Maps each behavioral mechanism to specific legal liability. Addresses the general counsel problem and the compliance function under conditions of organizational self-deception.
Presents five design principles — Evaluative Independence, Attention to Standards, Transparency of Pattern, Structural Separation of Counsel and Compliance, and Iterative Structural Audit — with a practitioner's implementation roadmap.
Available on Amazon
The Honest Organization is available as an e-book on Amazon.