Research

What can the mafia teach your business?

In business, ambiguity is traditionally viewed as a problem. Conventional wisdom suggests that, to be effective, executives must be decisive, communications must be clear, and strategies must be precise.

But according to research from Professor Eero Vaara, ambiguity has another side to it.

Under certain circumstances, a lack of clarity can actually serve as a strategic asset for organisations. In fact, organisations ranging from local governments to multinational corporations to the Sicilian Mafia have all used ambiguity to their strategic advantage.

Here, Vaara shares some of the latest findings from his research, along with a few key takeaways for practitioners.

 

Q: What has academic literature historically said about ambiguity?

Traditionally, ambiguity has been viewed through a largely negative lens in the context of organisations. Academics assumed that ambiguity made it harder to mobilise workers and created cultures that were resistant to change. They also believed ambiguity contributed to lower corporate reputations and weaker positionings in the market.

The narrative around ambiguity needs to evolve from being wholly negative to something that is more nuanced.

Q: How does your research depart from this thinking?

My research has found several instances where this is not the case – and, in fact, ambiguity has actually helped organisations achieve their objectives. 

I recently completed a study with two professors from Bocconi University, Dr Giulia Cappellaro and Dr Amelia Compagni, which addressed the use of strategic ambiguity for organisational protection. We studied over 50 years of history around the Sicilian Mafia and discovered that ambiguity played an essential role in protecting the Mafia from public scrutiny. The fact that the government, the press and the public could never agree on a single interpretation of the Mafia’s activities was, fundamentally, what enabled the organisation to survive.

Now, to be clear: This is not to say the Mafia’s strategy was ethical – far from it. But it was effective. This study suggests that the narrative around ambiguity needs to evolve from being wholly negative to something that is more nuanced.

Q: How can ambiguity help more legitimate organisations? 

The first example that comes to mind is around consensus building. 

Alongside my colleague Virpi Sorsa, I previously studied a Nordic city organisation that wanted to reform local healthcare services in order to balance its budget. Initially, many decision-makers were highly resistant to any change. Over time, the protagonists were able to move on with the reform by using a set of arguments that helped the antagonists play along. A key part of it was ambiguity, which helped to create consensus around the broader reform and allowed the antagonists to see aspects they wanted to promote.

The lesson here is that consensus building often requires a degree of ambiguity so that different stakeholders can accept it. Especially when initiating strategic change, it is often to your advantage to avoid statements that are too narrow or too clear-cut. Leave things a little more open to interpretation and let people relate to an idea on their own terms.

 

Q: Is it possible to be too ambiguous? 

Yes, of course. If you’re too vague in making your argument, your movement can lose focus or momentum. You need to give people a reason to mobilise. They need to understand your vision or feel like they share a common goal. 

I often tell people it’s a push and pull. Ambiguity is something you need to play with in order to discover the right balance.

 

Q: Can you give us an example of an organisation that has done this?

A few years ago, I partnered with Kari Jalonen and Henri Schildt from Aalto University to study how a Finnish city organisation made the case for reducing public services to its citizens.

Rather than discussing individual cuts, the officials started a movement promoting ‘self-responsibility’ in the local community. The idea of a society where people were more responsible for their own wellbeing was salient enough to mobilise its supporters, but also sufficiently ambiguous that others could accept aspects of it. In subsequent discussions, the various stakeholders came up with new interpretations, thus adding to the ambiguity. The people who came up with the original idea, in turn, tried to make sure that it wouldn’t become too ambiguous.

In terms of its effectiveness, this campaign for self-responsibility led to a series of changes, including reorganising city services, increasing service fees, reengineering service processes, increasing outsourcing and establishing public-private partnerships.

I believe leaders could benefit a lot from studying history, and looking outside their immediate industry or discipline, in order to address some of the most important issues facing business and society today.

Q: Based on your research, do you have any other advice for business leaders?

The last thing I’d say is, I know my research is a little different compared to what’s typical in business school settings; not everyone is studying the history of the Sicilian Mafia to inform better strategies. But I think it’s important not to fall into the trap of only studying what is most recent or popular. I believe leaders could benefit a lot from studying history, and looking outside their immediate industry or discipline, in order to address some of the most important issues facing business and society today.

This interview references three specific research papers from Professor Vaara and co-authors, addressing strategic change, sensemaking and ambiguity:

Maintaining Strategic Ambiguity for Protection: Struggles over Opacity, Equivocality, and Absurdity around the Sicilian Mafia is written by Giulia Cappellaro, Amelia Compagni and Eero Vaara and is published in the Academy of Management Journal.

How can Pluralistic Organizations Proceed with Strategic Change? A Processual Account of Rhetorical Contestation, Convergence, and Partial Agreement in a Nordic City Organization is written by Virpi Sorsa and Eero Vaara, and is published in Organization Science.

Strategic concepts as micro-level tools in strategic sensemaking is written by Kari Jalonen, Henri Schildt and Eero Vaara, and is published in the Strategic Management Journal.