For businesses to compete effectively well into the future, innovation is vital. The leaders in these organizations must not just execute on their promises but also make time for learning and idea generation at a speed that vastly outperforms others.
But one of the common misperceptions about innovation is that it only takes place when you have created something new. The truth is many ideas can help you modernize and innovate, which come from past and historical studies. What seems old for another company can still be new and cutting edge for yours.
Another generally overlooked concept is that what we learn in business schools and leadership books is only a portion of what is truly applicable for future success.
When business leaders learn from mentors, role models, and titans in their industry, they are often swayed by the most famous and “talked-about” heroes because their stories are accessible and popular.
But there exists a wealth of wisdom in the business cases that have been suppressed because they came from marginalized leaders and organizations.
Two notable thought leaders are changing the game on business and leadership education by helping managers and students expand their learning beyond the stories and cases we all typically hear.
Simone Phipps, Ph.D., and Leon Prieto, Ph.D., have dedicated their careers to researching and applying lessons drawn from management history toward innovation, leadership, and business success.
Furthermore, their prolific contributions show how much is missing from the existing management canon. In particular, their research uncovers many examples of successful Black entrepreneurs and business practices from minority communities which can provide immense guidance for mainstream companies and leaders participating in today’s economy.
They reveal the management stories that need to be told but have been ignored, ultimately depriving leaders, companies, and students of valuable business models that can solve many problems of today.
I sat down recently with Simone and Leon to learn more about their important work. Simone is Associate Professor of Management in the School of Business at Middle Georgia State University. Leon is the Director of the Center for Social Innovation & Sustainable Entrepreneurship and Associate Professor of Management at Clayton State University.
In addition to many publications, they co-authored the book African American Management History: Insights on Gaining a Cooperative Advantage.
And just a couple of weeks ago, Simone and Leon were honored for their work by Thinkers50, winning the 2021 Distinguished Achievement Award for Breakthrough Idea, putting them in the company of the most elite thought leaders in the world.
We discussed the unique way their work combines many disciplines across business, history, social, and racial justice.
And they shared with me their extensive work on “cooperative advantage” based on traditions across the African diaspora that you won’t find in the conventional business textbook but have proven to be significantly innovative in their value to society and financial wellbeing.
Thought leadership at the intersection of management, history, and justice
As researchers and educators, Simone and Leon have some separate focus areas.
Simone is an expert in organizational behavior and delves into many issues around leadership, culture, and the reciprocal impact organizations and society have on each other.
Leon likes to focus at a macro level on themes like “unbridled capitalism,” providing a critique of where the historical reverence for rugged individualism has ultimately led businesses and society astray.
Simone and Leon’s work overlaps in their attention to management history and the traditions and philosophies of racialized people that have not yet found their way into mainstream business education.
Simone told me, “from a management history perspective, we are looking at minorities, especially the gender minorities, ethnic minorities, racial minorities; seeing their struggles and their contributions from the past, and finding how you can learn from that.”
Leon added, “we’ve been very fortunate to stumble upon a number of these stories. I like to purchase a number of so-called forgotten books by black authors and search through the reference pages to look for little nuggets.
“For example, when we both found out about Charles Clinton Spaulding, we came across an article he wrote called The Administration of Big Business. And he pretty much gave his philosophy of management within that newspaper article.”
For reference, Charles Clinton Spaulding (1874-1952) was an American business leader and head of the North Carolina Mutual Life Insurance Company, America’s largest black-owned business with over $40 million in assets at his death.
But most people have never heard of him.
Leon and Simone’s work helped to shine a light on his example in the circles of management education. And their contributions led Thinkers50 to induct Spaulding into the Thinkers50 Hall of Fame posthumously.
“Charles Clinton Spaulding wrote [that article] for African-Americans who were considering working in a corporation or leading a business enterprise, and that article was nowhere in the mainstream management canon.”
Initially, Simone and Leon thought it was an interesting story but didn’t do much with it.
Then, through an unexpected coincidence, while shopping for furniture, they came across a gentleman by Charles Clinton’s name. He mentioned he was named after Charles Clinton Spaulding.
They saw that as a sign to pursue more research on Spaulding. But even more coincidental: “the guy went to the same undergraduate university as Simone and I.
“I immediately thought that we need to get on this. And after we wrote our paper, the rest was history, all pun intended.
“It pretty much jumpstarted our scholarship as it relates to looking at the histories of management from an Africana perspective.”
Business traditions of racialized people are “nowhere in the textbooks.”
The philosophy Leon and Simone promote the most in their work is called “cooperative advantage.”
They haven’t just seen the value of this concept in the research and historical examples they’ve uncovered; they’ve experienced it firsthand through their upbringing and culture.
“In the continent of Africa, they practiced a more communitarian style of managing enterprises. This approach was based on their belief in philosophies like Ubuntu, which stems from African humanism.
“Ubuntu, which is quite popular now, started in South Africa. Then there’s Ujamaa from Tanzania and Kenya; Umuganda from Rwanda. They’re all very similar in their philosophy. And it found its way into the Americas.
“Simone and I grew up in Trinidad, and we practiced certain African traditions that we didn’t even realize were African. For instance, in Trinidad and other parts of the Caribbean (and also the African diaspora), we practice something known as SouSou. It’s like a rotating savings and credit association, but it’s pretty informal.
“Someone in the community or village will serve as the banker, and we will all place a deposit every week, and then we’ll wait for what we call our payout.
“It depends on how many people are part of this merry-go-round rotating savings that determines how much you get. And the money can be used for a number of different things.
“We use it to save money. But some use it to start businesses. Some use it to purchase a home.”
Leon added, “I even used it for a plane ticket to attend college in the United States.
“It stems from tradition. I have to admit, I was a bit distrustful of the bank. It is strange to see that I had more trust in a community or a community association that stemmed from these African traditions, more so than a formal bank.”
Beyond Trinidad, cooperative advantage is utilized in countless other countries just under different names. Simone told me, “One system we use is Gayap, which means ‘lend a hand.’
“Let’s say someone in my community wants to build a home, and they can’t afford it. They will depend on people within the community to pitch in and lend a hand. And it’s a reciprocal type relationship.
“In Jamaica, this is called “partner;” in Guyana, they call it “box hand.” In Kenya, they call it “Chama.” Anywhere you go, there’s a different name for the same system.”
And it’s worth noting that in the United States, many of these traditions from the African diaspora persisted despite slavery.
“People still practice it in the black church and the mutual aid societies, and it found its way into black businesses because the black church and mutual aid societies pretty much jumpstart or bootstrapped a number of these black businesses.”
But despite their direct experience with these traditions and observing firsthand the business and social benefits they bring, Leon and Simone found they were virtually nonexistent in mainstream business education.
“We are doing ourselves a disservice by not spending time learning about the philosophies from racialized people,” they shared.
“For example, in India, there’s Jugaad innovation, used in several different contexts, but it’s nowhere in the textbooks. I didn’t know about this until I learned about different management histories and philosophies from different parts of the world. So there’s a lot we can learn from racialized people all over this globe.”
Why people resist practicing cooperative advantage
Simone shared, “when you come together as a united body, and you cooperate, things are going to be better for everyone. And when things are better for everyone, they’re going to be better for you.
“You don’t live by yourself on an island. You live with other people. And when other people aren’t doing well, that will affect you. Negative economic outcomes like poverty and unemployment impact you because they impact society. Things like a rise in crime as a result obviously will hurt you too.”
“And on a business level,” Leon added, “cooperation benefits companies because a people-centered approach and a spirit of care leads to better consensus building. The problem is that business people shy away from it.
“A lot of folks who are very proud ‘unbridled capitalists,’ tend to take a very myopic viewpoint. They look at Adam Smith and The Wealth of Nations [as the playbook], promoting the “invisible hand” and the importance of self-interest.
“But they forget [Adam Smith] wrote a little book known as The Theory of Moral Sentiments, which is about the importance of showing sympathy towards others. In today’s English, that means empathy. Yet, many tend to ignore that aspect of the conversation.
“So we want to keep promoting the whole sentiment of caring and empathy within cooperative advantage. We believe it has a place in making capitalism much more inclusive. There is a communitarian economic system that could work for all people, not just the select few.”
Simone and Leon also urge organizations and leaders to do more than talk about how much they care for the people in their employment and environment.
“When the racial justice movement accelerated last year during the murder of George Floyd, many companies showed “performative allyship,” Leon shared.
“It’s something that really upsets me, because a number of these companies say they’re going to make some changes and claim to care for their employees. But when it comes to truly addressing racial and environmental injustices that many racialized communities face, it’s a lot of rhetoric.
“For instance, look at the composition of the boards of many of these corporations. You might find ten unbridled capitalists. And you’ll be hard-pressed to find someone who’s a sustainability advocate or a community development advocate looking to do what’s right.”
Leon and Simone also emphasize that the idea of caring for the wellbeing of others while pursuing business goals is not exclusively a minority issue.
Simone told me, “People in the black or any underserved community can benefit from cooperating to advance. But we also need the white communities to get on board with this idea of thinking about the wellbeing of everyone.
“Because even in the white community, you have people that are poor, for example, or who are going to be left behind. So it’s not only for the black community or for people of color.
Leon added, “and I really want people of African descent to go back to their roots, and reflect on the tenets of cooperative advantage and how it stems from African humanism.”
Research shows the US rates higher on the “individualism” scale than other countries, as Simone pointed out, meaning that there is less focus on cooperation in achieving the American dream.
They shared, “For people of African descent in America who had no access to capital after slavery, cooperation was the only option to build wealth.
“But when they tried, white supremacists didn’t want them to do better than themselves. You had Black Wall Street being destroyed, for example. And many in the white community were accusing black folk of being Communist when they saw cooperatives as a threat to their businesses.
“So in the quest to be seen as good American capitalists, some African Americans abandoned this whole communitarian ethic. But it’s time that we go back to the roots, for lack of a better term.”
Preparing leaders for the future by redefining our business heroes
As educators of business school students, Leon and Simone are helping expand the mindset and awareness of the leaders of tomorrow. And by uncovering the stories that have seldom been told, they are shining a valuable light on the past and current practices of racialized people that can guide future leaders and organizations toward better outcomes.
“We’re very big on decolonizing the curriculum,” they shared.
“I try to stress to my students that there are other forms of enterprise building, and you can embody a spirit of cooperation; you don’t have to be a lone wolf entrepreneur,” Leon said.
“There are other business models that can incorporate this whole philosophy of cooperation. So be it cooperatives or ESOPs (employee stock ownership programs), as just one popular example.”
Simone also offered where cooperation can be a valuable solution for the current global supply chain crisis we are seeing today.
“It would be great if we see corporations include some worker co-ops that embody the spirit of solidarity and a spirit of care within their global supply chains to actually help alleviate some of the labor atrocities that we are seeing.”
“And it’s usually people in the Global South who are affected,” Leon added. So we need to challenge our students with a curriculum that thinks deeply about reforming this economic system by integrating this philosophy of cooperation.
Business schools have a major role to play. And frankly, we are failing at that task. We are not doing the job currently, and you can quote me on that.”
As an MBA graduate conversing with these two business school professors, the three of us shared a common observation about conventional education on economics and business:
Many of the same heroes continue to be revered instead of searching for new role models in overlooked or underappreciated stories.
“A lot of business people,” Leon shared, “love to elevate Milton Friedman. That’s their hero.
“He talks about the purpose of a business is to maximize return to shareholders. They love that, but I would love my students to have some very different people as their heroes in business.
“I want them to look at Charles Clinton Spaulding, Annie Turnbo-Malone, and other names that they probably never heard of; those people who pretty much embodied that spirit of cooperation.
“People like Ella Baker – who is not well known but a civil rights leader very much into cooperatives. Father Albert McKnight started a quiet revolution in Louisiana by getting a lot of poor folks there interested in starting cooperatives within the South. He’s someone most African Americans never heard of, but he’s a legend in his form of business.
“We have examples within the culture that are not elevated by the culture. It’s sad because many of us drank the Kool-Aid, believing unbridled capitalism is the only way, but it is not the only way.
And this goes for not just black and brown people, but all people in general. There’s another viable business model that has the potential to make capitalism a more compassionate system.
Nihar Chhaya is an executive coach to CEOs, founders, influencers and C-suite leaders at global companies.
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