Manipulative Businesses: Secular Business Cults

• Author: Brian W. Kulik,Michelle Alarcon
• Date: 01 June 2016
• Published date: 01 June 2016
• DOI: http://doi.org/10.1111/basr.12087

Manipulative Businesses:

Secular Business Cults

BRIAN W. KULIK AND MICHELLE ALARCON

ABSTRACT

Many destructive business leaders drive their companies

into bankruptcy and dissolution, never to be heard from

again in the business press. However, it is useful to study

these organizations to prevent the same, or similar

destructive business from taking on, and destroying,

additional businesses. In this article, we describe one

type of organization that follows the model of religious

cults, which we call secular business cults. Building on

Padilla et al., we describe an SBC toxic triangle of (1)

Padilla et al.’s societal factors, (2) additional business fac-

tors, and (3) antisocial actors that set the stage for the

SBC’s emergence. We then describe the characteristics of

the SBC’s operations, such as an ultrastrong culture, for-

malized manipulation, manipulative hierarchical relation-

ships, competition, and operations efficiency tools, and

the frequent overcommunication of deceptive messages. It

is our hope that this unique perspective on organizations

will inspire research into an overlooked area of unethical

behavior in businesses today. In our Part II paper on the

Brian W. Kulik is an Associate Professor of Management at Angelo State University, San

Angelo, TX. Previously, he was an Associate Professor of Management at Hawaii Pacific Univer-

isty, Honolulu, HI. E-mail: bkulik33gmail.com. Michelle Alarcon is an Associate Professor of

Management at Hawaii Pacific University, Honolulu, HI. E-mail: malarcon@hpu.edu.

V

C2016 Center for Business Ethics at Bentley University. Published by Wiley Periodicals, Inc.,

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Business and Society Review 121:2 247–270

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topic, we intend to extend the idea of SBCs to manipula-

tive businesses, which are essentially reorganized, well-

established and legally-complying revisions of SBCs, and

then to manipulative industries and societies.

INTRODUCTION

Tyco’s Dennis Kozlowski, Enron’s Ken Lay, Jeffrey Skilling,

and Andy Fastow, Sunbeam’s Al Dunlap, Madoff Investment

Securities’ Bernie Madoff, Worldcom’s Bernie Ebbers, Qwest’s

Joe Nacchio, Gelleon’s Raj Rajaratnam: The popular business press

is brimming with destructive business leaders who, once revered,

have since failed their companies catastrophically. One might argue

that these are examples of capitalism at its best, when unscrupu-

lous, “bad” leaders abuse the system, which reacts by rejecting

these bad actors like white blood cells fighting off a virus in the

human body. However, our capitalist system may not successfully

reject all of its destructive leaders. In fact, there may be an emerging

trend that today’s destructive leaders are learning to adapt, to trans-

form themselves into constructive, successful leaders that neverthe-

less lead businesses in unethical directions and manipulate its

members and constituents. As an executive MBA student once com-

mented to the first author, “Some [people] start [well] but later move

on to the ‘dark side’ and don’t want to [add value to their organiza-

tion] because they know they can get away with it.” What we need is

a careful articulation of the characteristics of the successful, but

unethical, business to develop measures to prevent their formation.

To prevent the formation of irresponsible businesses, we need to

understand the causes of their emergence. Growing academic atten-

tion has been paid to the dark side of management practice and

theory, no doubt stimulated by the dizzying array of corporate scan-

dals since Enron’s fall and dissolution, and revived by the attributed

causes of the so-called Great Recession. For example, the dark sides

of leadership (Conger 1990; Gini and Green 2012; Kellerman 2004;

Padilla et al. 2007), management development (Kamoche 2000),

organizational politics (Williams and Dutton 2000), agency theory

(Kulik 2005), positive organizational scholarship (Fineman 2006),

intrafirm competition (Kulik et al. 2008), capital markets (Clarke

and Newell 2013), manic behavior (Stein 2011), workplace spirituality

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