Human Operating System 3 – Executive Function

Executive Function in the Individual and the Organisation

Successful organisations like Google and Facebook allow their employees an opportunity to experiment and pursue their own projects. Many public sector organisations also allow their employees opportunity for personal development. Why does this work and what does it say about how organisations need to be run in a world of increasingly rapid change? What kind of executive control is appropriate for organisations in the 21st Century?

To answer this we could look at all kinds of management, organisational and accounting theory. But there is another perspective. This is to look at what psychology has revealed about the executive function (REFs 1, 2, 3) in the individual and then to map that back onto what it means in terms of the organisation. This perspective can be revealing. It highlights why organisations behave in certain ways, it can help distinguish useful and healthy behaviours from those that are ineffective, aberrant and perhaps eventually self-defeating, and it can give us a way of looking at the executive function that is grounded in an increasingly sophisticated understanding of the human condition. It can point the way to making organisations more resilient.

REF 1
YouTube Video, ‪2012 Burnett Lecture Part 2 ADHD, Self-Regulation and Executive Functioning Theory‬, UNCCHLearningCentre, November 2012, 58:44

REF 2
YouTube Video, InBrief: Executive Function: Skills for Life and Learning, Center on the Developing Child at Harvard University, June 2012, 5:35 minutes

REF 3
Youtube Video, Executive Function and the Developing Brain: Implications for Education, AMSDMN’s channel, November 2013, 58:22 minutes

There are several distinct components to executive function in the individual. These develop from infancy to adulthood more or less in order. This article looks at the overall architecture of control within an organisation then goes through seven executive functions one by one, first looking at what it means in psychological terms, then mapping it onto what it might mean in terms of organisational behaviour and the functions of an executive board.

In both the individual and the organisation, executive function is self-regulation. It is ‘actions on oneself’ or, in the organisational context, the executive actions in relation to the organisation itself. When fully developed the several aspects of executive function go together to provide the capacity for self-control in a complex and changing world.

There are numerous accounts of what makes for success in both the individual (and in the organisation). Many of these emphasise one or other aspect of executive function such as self-awareness, self-direction or emotional intelligence. However, all aspects of the executive function have a part to play, and understanding executive function helps demonstrate how all these parts develop and integrate to provide the many capabilities needed for success.

The Architecture of Control

The overall architecture of control in both the individual and the organisation can be seen as a two-part system with executive function residing in the second part.

Part 1 – An Automatic System

Much of what happens in both individuals and organisations goes on without much thought or reflection.

Individuals follow their routines and habits. When everything is predictable, actions like cooking or driving can be carried out largely on ‘autopilot’, often while thinking about something entirely different. In this manner, we can operate adequately on the basis of responding to cues in the immediate environment with little conscious control or effort. This is what Kahneman in his book ‘Thinking fast and Slow’ (REF 4) calls ‘System 1’ or intuitive thinking. It deals with the here and now when everything is familiar and reasonably certain.

REF 4
YouTube Video, Kahneman: “Thinking, Fast and Slow” | Talks at Google, November 2011, 1:02 hours

Similarly, in the organisation many activities can be carried out according to it’s established procedures and practices and require no executive intervention. They may have needed executive intervention to set them up but once bedded-in they can run without further executive input unless something unexpected or out of the ordinary happens.

Part 2 – A System for Exception Handling and Taking Proactive Control

Exception Handling

This system is engaged when the automatic system needs help. In terms of Khaneman’s theory, it is ‘System 2’ thinking. It is engaged when encountering difficulty, novelty and in matters that are not in the here and now. The executive level allows ‘action at a distance’ from the here and now, and deals with circumstances that are less certain and predictable.

In the individual, when something unpredictable happens, this system seems to pop items into consciousness and then relies on a somewhat slow and labourious form of conscious processing to effect a resolution. This takes effort and resource. It takes willpower and can use up cognitive capacity. What can be done is limited by the available capacity, and focus of attention on one thing will limit the capacity to pay attention to another.

In the organisation the executive may be called in to deal with some problem or may step in when it sees something going off-track (like profits, sales, production, costs, staff-turnover etc). As with the individual, this system, is slow and labourious by contrast to the ‘business as usual’ operation. It also requires the consumption of precious resources and dealing with one situation can detract from dealing with another, perhaps causing the organisation to take it’s eye off the ball.

In practice, in a healthy individual or organisation, the automatic system and the exception handling system work together in a highly interleaved manner. They also develop together. Functions that start out as requiring exception handling, become automated over time as they become embedded.

Pro-active Control

In the individual, the pro-active element of executive function emerges in childhood. The extent of the ability to inhibit certain behaviours correlates highly with many factors in later life including academic and social competence, wealth, health and (negatively with) criminality. It seems that the developing child moves gradually from reactive control to pro-active control. (REF 5).

REF 5
YouTube Video, Integrative Science Symposium: Lifespan Development of Executive Control, July 2015, 2:10:08 hours

This is more than just being able to stop or inhibit certain behaviours. There is an extra step. This is to re-construe the world in a slightly different way and become alert to other things going on in the environment. The extra step leaves open the option to continue the behaviour, stop it or do something more subtle.

Similarly, in the organisation, spotting an undesirable behaviour, trend or process does not generally result in immediately shutting it down. There is a period of reflection, where attention may be re-focused and alternatives considered. In both organisations and individuals, this may take time. An individual may think through the potential consequences of taking particular courses of action. The organisation may do the same by embarking on investigations or sophisticated modelling and simulations to help clarify the consequences of running with different options.

A simplified model of the control and executive function is:

• No problems – continue on autopilot
• Problem – re-focus attention, generate and evaluate options

Also, it is notable that problem solving can go on recursively. So, if a problem is encountered with any of the sub-processes of problem solving, then that’s a new problem that is subject to the same processes in achieving resolution. Meanwhile the whole process is being recursively and externally evaluated such that if it’s not going anywhere useful, it itself can be re-considered.

7 Stages of Development of Executive Function

Seven stages of development of the executive function are described in terms of what’s going on for both the individual and the organisation. There are striking parallels.
Many of these stages have a time dimension. An infant lives in the here and now, a teenager in perhaps weeks. An adult, like an organisation, may have a time horizon of months or years. The development of executive function enables longer time horizons.

In Early Development (0 years to 5 years)

Stage 1 – Self-Awareness

In the individual, self-awareness develops in infancy (from 3 months and continues to develop for a further 10 years). The capacity to turn one’s attention away from the environment and towards ones own actions and thoughts, grows. The self-monitoring function redirects attention back on the self. An executive has developed that watches the self.

An organisation might be self-aware from the start if it has been set up with management information systems. The executives can inspect the reports and consider actions designed to affect trends they see in the data. The executives normally act within a stable framework of parameters albeit that the values on the parameters are changing. Also an organisation may grow in self-awareness by introducing new systems to provide feedback on what are deemed to be key parameters.

When (informal or formal) management information systems come into play, they can become the basis of a prevailing viewpoint on the direction of the organisation, both past and future. This is the backdrop against which executive decision-making takes place. The organisation has become to some degree self-aware and able to turn attention onto itself.

However, both the individual and the organisation operate in what Simon refers to as ‘bounded rationality’ (REF 6). Organisational self-awareness is subjective in the sense that the organisation is only aware of what it is aware of. It may not be aware of all manner of things and what it is aware of may not be representative or accurate. In this sense, the organisation mimics the individual and may be subject to the same misconceptions about the self.

REF 6
YouTube Video, Herbert Simon, rationalLeft, July 2013, 3:42 mins

For example, Baring Bank may have been blind to the extent of the damage a rogue trader could do. Kodak may have deluded itself into thinking that there would always be a market for film (as opposed to digital). In 2008, the banking industry may have been unaware of the damage it might do to itself by not containing risk. Just as likely, these organisations were aware but didn’t care or know how to react.

These are just examples of self-awareness of organisations and begs the question of who holds this awareness. Is it distributed throughout the organisation or is it held by the executive? Just as in the brain, any one neuron is ‘aware’ of the activity of other neurons it is connected to, whether they be near neighbours or in some more remote location, awareness is distributed throughout the individuals and departments in an organisation. Each department and organisational role is tasked with being informed about particular things – production, human resources, suppliers and so on. In collecting and reporting both quantitative and qualitative data about local activity, the executive is fed information from across the organisation and can build a broader awareness. However, just as the brain can be deceived by it’s senses or selective and biased in its interpretation, the uncritical executive can also be led astray.

Stage 2 – Self-Restraint

Self-restraint develops In the individual between the ages of 3 and 5 years. This is the ability for a child to stop him or herself doing something that they would otherwise do automatically (like taking a sweet). It is inhibition of action. Children between 3 and 5 years will put their hands over their mouths to stop themselves saying something. In time this ‘executive inhibition’ can be done internally but it takes effort. It draws down on a limited resource.

In the organisation there are several mechanisms for self-restraint. Budgets act as inhibitors by containing costs in parts of the organisation and overall. Also, organisational policies, procedures, standards and guidelines are often designed to inhibit behaviours other than those already approved. The development of procedures is often motivated by ‘error’ – something has gone wrong and the organisation tries to make sure it doesn’t happen again. Procedures, new or just changing, often meet some resistance and it takes effort or resource to overcome it. Once bedded in, however, they can be executed more cheaply. The operation of restraint has become automatic. It has moved from the proactive and exception handling control system to the routine and automatic control system.

Stage 3 – Imagery and rapid brain development

In the individual imagery is ‘the mind’s eye’ or ‘a theatre in your mind’. It is the ability to resurrect (visual and other) images from the past (together with accompanying emotions) to deal with the present. In the child, imagery develops between 3 and 5 years. This is mainly imagery of situations represented in all the salient senses – visual, auditory, tactile, taste and smell – whatever was relevant at the time. The imagery may be stored along with how you feel about it, good or bad (to some degree). Pattern-matching triggers memories and resurrects relevant imagery from the past to act as a guide or a map that can be used in the here and now.

The developing brain at this stage consumes 60% of the glucose consumed in food and is creating new connections between neurones at a rapid rate. Although the visual systems in the brain can be fully wired up from the age of one, other sensory modalities take longer. At some stage a tipping point is reached when infrequently used connections are purged. This developmental progression is thought to facilitate innovation and hypothesis testing about the environment up to the point where consolidation on viable interpretations set in. The young mind mimics the progression of science in exploration before consolidation into useful knowledge that can drive applications.

Youtube Video, Alison Gopnik Lecture at CFI – When and why children are more intelligent than adults are, Future of Intelligence, September 2017, 1:31:50 hours starting at 15:35 minutes

In the organisation, the memories of staff and the management of files, file sharing, databases and information systems is its ‘working memory’. These systems are largely designed with retrieval in mind. Although, the data captured is not inherently what you would call image-evoking, it does perform the same function of retrieving memories (records, documents, anecdotes) that help guide action in the here and now. Envisioning activities, prototyping, simulation and modelling activities in the organisation, parallel the ‘theatre of the mind’. They are part of the organisations imaginative activity, where ideas can be tried out before they are fully implemented (and incur the full costs and consequences of acting on the world outside the organisation).

Stage 3a – Theory of Mind

There is another important stage that appears to develop between the ages of 3 and 5 years, that tends not to be emphasised in the mainstream literature on executive function. This is the so-called ‘theory of mind’ (REF6a) – the ability of a person to model what another person is thinking and feeling. Experiments with children show that a three year old expects everybody else to know what they themselves know, while by 5 years a child understands that other people can have different beliefs from themselves. If, for example, the content of a chocolate box is replaced with, say crayons, in front of a three year old, they will think that somebody later coming into the room will expect to find crayons in the box rather than chocolates. They are unable to differentiate between their own knowledge and the knowledge of others.

REF 6a
YouTube Video, Robert Seyfarth: Theory of Mind, Richard Dawkins Foundation for Reason & Science, May 2010, 3:36 minutes

Theory of mind may not be addressed in mainstream accounts of executive function because it is thought of as a social skill rather than a fundamental information processing capability, but I think it should be thought of as a key part of executive function because it is a base on which later executive functions develop. The multiple voices that develop in private speech, for example, are akin to the playing out in the mind of multiple belief systems and theory of mind must also impact on management of ones own emotions and motivations. In fact, the implications of theory of mind are so significant that it has generated its own large literature. Autism and Asperger’s Spectrum disorders increasingly reference both deficiencies in executive function and in theory of mind, adding further support to the argument that theory of mind should be seen as an aspect of executive function.

Research at the Max Planck Institute suggests that the maturation of fibres of a brain structure called the arcuate fascicle, between the ages of three and four years, establishes a connection between (1) a region at the back of the temporal lobe that supports adults thinking about others and their thoughts and (2) a region in the frontal lobe that is involved in keeping things at different levels of abstraction.

REF 6b
Article, Brain Structues that help us understand What Others Think Revealed, Neuroscience News, March 2017
http://neurosciencenews.com/fiber-connection-cognition-6293/

In the organisation, ‘theory of mind’ is akin to understanding your competitors and your markets. If an organisation’s theory is accurate then it will be better able to anticipate the consequences of events, both those that it control and those that are external (e.g. government legislation and changes in market conditions). For example, if an organisation changes the price of one of its products, it would be useful to be able to predict what its customers and competitors would think about this and how they are likely to respond. A good businessman, like a good car salesman, may have an instinct about how customers will respond and may be able to construct a more or less complicated strategy that will drive the behaviours of others in particular ways.

From 5 Years

Stage 4 – Private Speech

In the individual, at 3 years old everything is public. Children talk to themselves about the world. Listening to their own speech is a mechanism facilitating reflection and self-control. Between 3 and 5 years vocal actions and accompanying facial expressions become suppressed and the voice becomes internalized as a silent mechanisms of self-control.

Artificial intelligence is now being recruited to re-create the kind of dialogue we have with our inner voices.

REF 6c
BBC Radio 4, The Digital Human – Series 11, Echo, May 2017, 5:27 minutes
http://www.bbc.co.uk/programmes/b08npnh6

However, even as adults, the nuances of facial expression leak information about what is going on in the mind, but most adults learn to distinguish between situations in which this is useful and those in which it presents some danger. Also, they can learn how to dissociate what is going on in the mind from what leaks out in the face and body language, thereby conferring the ability to deceive. (REF 7)

REF 7
BBC Radio 4, Where do voices inside our heads come from?, April 2016, 5:27 minutes
http://www.bbc.co.uk/programmes/p03qq9mt

Youtube Video, What Causes The Voice In Your Head?, Thoughty2, August 2015, 6:57 minutes

In the organisation, executives are only too aware that they cannot air all of their thoughts in public. Executives are ultra-careful about what they communicate, to whom and how, or they soon learn. Board meetings are often closed and communications can be deliberately targeted, sometime with the help of a communications or PR department. Wise executives rarely blurt out the first thing that comes into their heads. They inhibit that tendency and use their own thoughts to first control their own behaviour. They exercise self-control. Some private speech ends up in the boardroom, especially the closed sessions, while the public speech is crafted by the PR department. Just as in the individual this can be crafted to deceive or mislead, but also, just as in the individual, the real danger comes when the executive starts to believe its own deceptions.

Stage 5 – Management of own emotions

The individual, by resurrecting images of the past, can ‘control’ his or her own emotional states in order to be able to socialize more effectively and not drive other people away. An individual can act to put themselves in a better frame of mind, not make important decision while angry, and otherwise act to exert some control over their own emotional state.

Daniel Goleman (REF 8) in his book ‘Emotional Intelligence’ identifies 4 aspects of emotional intelligence – (1) Self Awareness (2) Self-Management (3) Empathy and (4) Relationship Management. The first two of these are regarded as key executive functions whilst empathy and relationship management extend executive function into the social sphere that do not fully develop until adulthood.

REF 8
YouTube Video, Daniel Goleman Introduces Emotional Intelligence, April 2012, 5:31 minutes

Can organisations be said to have emotions? The answer is ‘yes’. Announcing profits, losses, redundancies, being given awards or a bad press can have emotional repercussions throughout the organisation. Sustained ‘moods’ can have implications for the organisation culture. Some organisations have enthusiasm and optimism while others have low morale and become depressed and dysfunctional. Some organisations feel threatened, get anxious and show some of the common human defence mechanisms such as denial, over-compensation, projection and compartmentalisation (REF 9).

REF 9
Article, 15 Common Defense Mechanisms, John M. Grohol, Psy.D.
http://psychcentral.com/lib/15-common-defense-mechanisms/

The organisational memory of emotional events in the past (both traumatic and elating) can help to manage a current situation but often relies on there still being people engaged that remember the past. Most executives are only too aware of the relationship between the mood and culture of an organisation and its performance, and act to manage the mood. Even when times are hard they convey a positive message and vision that helps take the organisation forward. However, an unrealistic representation, or a glossing over of current circumstances, risks losing the trust of the people that are the key to future success.

Stage 6 – Management of own motivations

In the individual, this is self-motivation or self-determination. Management of your own motivations frees the individual from thinking and acting in ways that have been learnt, either through practice in response to circumstances or by copying others. It opens new doors. You no longer have to be driven by habits or others expectations. You can think for yourself, determine your own goals, prioritise them as you think fit and work towards them in any way that you like.

Imagery has already developed to allow external consequences to be substituted by mental representation. Motivations can thereby be created in relation to events that are distant in space and time, and these can be reasoned about and managed without recourse to acting on the outside world.

In the organisation: Organisations specialise in the management of motivation. In particular they manage motivations with respect to profit (or at least self sustainability) but this is achieved with reference to the organisation’s mission. Many companies will have a list of strategic goals or intentions, and although profit often comes high on the list, there are others such as customer and staff satisfaction. Often separate departments take charge of these different motivations but eventually it is the executive that must coordinate them. At worst it must suppress conflicts. At best it provides orchestration, aligning motivations so that parts of the organisation support each other.

Daniel Pink in his book ‘Drive’ (REF 10) describes recent studies on how organisational incentives affect employee motivation. For routine tasks that can be performed on ‘auto-pilot’ (system 1 thinking) monitory incentives seem to work well as a means of keeping people on task and increasing performance. However, and running counter to previous views, it seems that financial incentives either do not work or actually impair performance when the work involves higher level executive functions such as reasoning and problem solving. The more effective incentives for these types of tasks are: autonomy, mastery and purpose. Autonomy means allowing employees to have the freedom to achieve goals in a manner of their own choosing, rather than having the method defined and prescribed. Mastery means giving the employee the freedom and resources to develop their own skills to a high standard, helping engender a greater degree of self-worth. Purpose refers to a socially useful purpose beyond that of the individual. It means joining with others to achieve something great, that the individual could not have achieved alone. Pink argues that the 21st Century worker must be incentivised in this way or they will not be sufficiently agile , resourceful, flexible and resilient to cope with the rapidly changing demands of a modern global economy.

REF 10
YouTube Video, The puzzle of motivation | Dan Pink, TED, August 2009, 18:36 minutes

Stage 7 – Internalised Play

In the individual, the last manifestation of executive function is internalised play (REF 11). Internal play involves self-awareness and analysis, imagery, synthesis, planning, emotional and motivational control, and problem solving. It builds on all the other executive functions to allow us to take apart any object of our thoughts and re-construct them in the mind, in novel ways, to meet the needs of the moment.

REF 11
YouTube Video, Learning Through Play: Developing Children’s Executive Function, Center on the Developing Child at Harvard University, September 2015, 27 seconds

In the organisation: Organisations that are big and profitable enough, make room for a lot of internal play and experimentation, only some of which will lead anywhere. Play itself allows the organisation to exercise its muscles, fine tune its processes and see where ideas might lead without heavy financial commitment.

Several references are provided below to elaborate on this and to show how play is a necessary ingredient in the development of the highest levels of executive function.

Implications for Organisational Development

Self-Awareness: Without self-awareness there is no self-control, but equally damaging is an inaccurate or biased self-awareness. Key Process Indicators (KPIs) and other management information systems can provide self-awareness but in the same way that an individual can become pre-occupied with their own inaccurate perception of themselves, an organisation can become equally distracted by KPIs that are easy to measure but are not closely aligned to its mission and strategy. It is only too easy to be deceived by the apparent objectivity of KPIs, especially when it is in the interests of different parts of the organisation to supply data that it knows the executive wants to see. In the same way that individuals tend to select the information that confirms their prejudices, an organisation can be similarly ‘blind’ to information it feels uncomfortable with.

Self-Restraint: An individual without self-restraint is often impulsive, easily distracted, lacks focus and fails to finish tasks. Too much restraint, by contrast, makes the individual inflexible and fixated. Organisations without self-restraint often pursue short-term goals at the expense of longer-term profitability. They are unable to defer gratification. By contrast, some organisations the have a tendency to over-control and tie themselves up in their own bureaucracy. Over time more and more procedure is put into place, often to correct errors of the past, until it is so rigid that it cannot respond to change. This is one reason that organisations often continuously re-structure and why some organisations seem to pulsate as control alternates between being drawn into the centre and distributed to autonomous operating units. Each process seems to run away with itself then needs to be reigned in again. The best organisations, rather than control, simply provide services to their management making it easy to carry out the functions that are central to its strategy, and more difficult to do anything else.

Imagery: The capacity to create, store and retrieve information is key to the individual in their personal development. Without the capability to learn from the past and retrieve that information when relevant an individual would act like an amnesic. An organisation without a memory of the past is similarly disoriented, and will stumble about without an understanding of what works and what doesn’t. Furthermore, without memory it is impossible to imagine what could be. Images of the past are the building blocks on which futures are built, often combining elements of the past in new ways to create novel solutions.

Theory of Mind: Understanding how customers and markets will react to events, including those events an organisation has control over, is critical in navigating and organisation through a constantly changing world. An organisation, say a government, that fails to anticipate a negative reaction to a new policy, law or budget change may find itself having to backtrack and even apologise. This is perceived as a weakness, precisely because it demonstrates that the organisation has an inadequate theory about other players. In politics in particular, it shows incompetence because politics is all about the anticipation and management of others’ reactions.

Private Speech: Private speech is more than just suppressing what is shown in public. It is the capacity to create internal dialogue and debate, to model and speculate on possible consequences of actions that have not yet been performed. The evaluation of actions before they are performed is essential to good decision making in both the individual and the organisation. Investment decisions benefit greatly from hearing a range of voices, from both within and outside the organisation, before they are acted on.

Management of Emotions: Emotions are at the route of most decision-making because they impact both an individual’s and an organisation’s priorities. The prevailing ethos of an organisation and how it affects the way staff feel, can be critical to the smooth functioning of the organisation. Some organisations have a ‘blame’ culture and, all factors being equal, any spontaneous activity on behalf of employees is suppressed. Others encourage free-thinking and innovation. How many organisations monitor these cultural and emotional factors and manage them as standing agenda items? Even when managed, most organisations are ineffective in the control of the prevailing emotional ethos and their interventions to control can easily backfire, especially if they look manipulative.

Management of Motivations: Like other functions ‘management of motivations’ can be done over-zealously or in too relaxed a manner. Self-determination is an asset so long as it does not fly in the face of circumstances. Motivations and intentions have to compromise with circumstance. The market has to be ready for your brilliant idea. Having said that, switching motivations has a cost. Even introducing a new service is expensive, let alone an entire change of strategy. Balancing the benefits of sticking to your guns with the cost of being flexible is a necessary skill. Organisations that manage to successfully grow organically achieve this balance.

Play: An individual cannot be fully functional without the opportunity to integrate all its mechanisms of executive control around the activity of play. Play allows experimentation and innovation in a safe environment, away from the dangers of the real world. Similarly, the organisation cannot be said to be fully functional without some room to play. The organisational practices of accounting for everything, monitoring every key performance indicator or extorting every last drop of employee or shareholder value, leads to organisations that are essentially reactive and immature. They are unpractised at thinking deeply at all organisational levels, and therefore lack resilience and the ability to adapt smoothly to changing circumstances. Like the individual that has failed to develop a wide range of coping strategies, they may lurch from crisis to crisis. Essentially, any change in circumstances can result in them becoming ‘out of control’.