At the beginning of 2001, the director general of the auto company Renault Group’s parts and accessories division (which designs, markets, and distributes Renault spares and accessories worldwide) began an experiment in storytelling when the division moved out of its premises. The project, code-named “e-DPA,” was designed to take advantage of the removal in order to introduce new bureaucratic technologies and to infuse the whole division with a dynamic of change.
“The study’s objectives are clear,” write the consultants who carried it out. “Our goal is not to audit the project, but to record the history of the project as it is experienced by a group of individuals [by concentrating on] the difficult moments in this adventure, not in order to challenge individuals, but to adopt the perspective of managerial capitalization and the logic of communications. The team scrupulously respects the anonymity of the interviewees.”1 The method used was inspired by one developed by MIT’s Center for Organizational Learning, which has established seven successive stages for collecting and processing stories inside a company.
The first phase helps to identify learning processes, to define the target audience, the “perimeter of the capitalization of experiences,” the questions that have to be asked, and the preconditions for management’s involvement. The second phase involves collecting data from between ten and twenty people who are interviewed using ethnographic-style interviews; these are used to turn the lived experiences the company wants to describe into a narrative. The recorded interviews are transcribed in their entirety.
Stage 3, “Condensation and Distillation,” gives an initial synthesis of the themes and plots that came up in the conversations, and produces a “coding plan” that allows all the stories to be merged into a coherent whole. The most interesting stories are organized thematically and put into a single time sequence. “The notion of distillation is carefully chosen,” write the authors,
to get across the essence of this activity, which consists in taking the huge volume of data that came out of the interviews, and then in correcting, filtering the raw data and refining it into a form that the organization can understand. The goal of the distillation process is to balance out three sets of data: the factual data that guarantees the story’s credibility; the narrative data that makes the story human and interesting, in the form of vignettes, for example; and finally the messages, which must have a transformative effect on those they are addressed to.
Weekly meetings (stage 4) allowed almost 600 pages of transcript to be analyzed and reduced to 100 or so pages. The team chose 21 of the 100 little stories that had been selected, and used them to construct a final story of 22 pages. The story was written using the concept of the “jointly told tale,” which is borrowed from ethnography: it is told both by the ethnographer, represented here by the storytelling team (which could just as well be made up of professional historians), and by his informants (actors from the company who had been directly involved in the story being told). The way it is written borrows the “two column format,” which respects the polyphony of participants and observers. The story is then validated (stage 5) to check the chronology, quotations from the participants, and the initial interpretation. Finally, the story is distributed, first inside the company (stage 6) and then to a broader outside audience (stage 7), to ensure that the company projects a good image of managerial innovation. The authors conclude:
This experiment confirms the importance of using this technique to analyse planned changes that have a rich human content. The project’s actors can be described as “precursor heroes”: they have left a place where they have worked for many years, have moved from private offices to open spaces, have reduced by a factor of ten the documents they keep, have been introduced to technologies (NICTs), and have learned to book a meeting room on the Intranet, all within a very short space of time.
Computer-Assisted Storytelling
As this example demonstrates, the introduction of storytelling into a company follows very strict rules. It is not simply a matter of humanizing the management of “human resources,” but of capturing workplace relations in a narrative net that takes the form of an oral story by submitting it to computerized writing and tracking, both at the level of collecting the stories, and that of processing, coding, and distributing them.
Storytelling makes it possible to collect expert stories, to identify the important stages in the decision-making process, and to identify the actors who played a role in the implementation of a project. It is, however, a cumbersome and expensive process. Hence the need to computerize the collection of narrative fragments, to encode stories so as to facilitate their use, and to systematize the way they are circulated. Storytelling is not a single flow that is fed by a supply of microstories collected from the teams, but rather a multiplicity of discursive centers that is structured by the way the stories are recorded and by the procedures used to retranscribe and redistribute them. The term also refers to the set of techniques that transform spontaneous stories into useful stories; as they are collected, the mechanisms used to record the stories combine spontaneous stories with “constrained” stories, and narration with prescription.
Postindustrial companies increasingly think of themselves as machines for processing stories. There are times and places for collecting stories: the water cooler, the elevator, the workshops at which stories are shared, the Internet, and the Intranet. Companies have their story banks, and an interest in archiving and codifying. Carefully managing their narrative capital, they collect the stories that tell their history, index them, project them outwards and store them in their employees’ memories. They draw up trees of causes and events, encode behaviors, and investigate “tracked experiences.”2 They spread “good practice” and make “tacit knowledge” explicit.
Storytelling is therefore not a spontaneous or somewhat naïve exercise in non-directive listening. The stories that are collected are regarded as raw materials to be refined, pruned, and codified. Before they can be transformed into true experience vectors that can be easily circulated, they must be modelled and distributed in accordance with computerized procedures:
Having optimized the data, information, and knowledge, companies are now trying to use information technologies to process their narrative information. Storytelling refers both to the sharing of narratives and to the methods and tools that are used to process the narrative information and facilitate its circulation inside the company so as to improve knowledge-sharing, bring together virtual communities, develop skills, decide, communicate or innovate.3
Research into narrative thus overlaps with research into information and communications science and technologies in order to develop new methods for modelling, simulation, and tests—and the appropriate software. How can computerized processing techniques be used to identify narrative elements that are formulated in spoken language? Is it possible to formalize, in machine-readable form, the information elements contained in narrative documents on, for example, relations between people and events?
These are the questions storytelling engineers tell themselves, and they are resolved to take seriously the possibility of computerizing stories. Narrative Knowledge Representation Language, for example, is a computer environment designed to process narrative documents. Some software packages, such as Hyperstoria, make it possible to break a narrative text down into segments, to label its main elements and arrange its propositions into a temporal-causal sequence, to identify scenes and to draw up trees of causes and decisions. Ontostoria, which was developed by Eddie Soulier in 2004, is designed to computerize the indexing of narratives and produce a narrative ontology based upon the principles of cognitive semantics using classes of terms (almost 150) predetermined by four main criteria (genre, plot, theme, and character). The expert selects those he or she finds pertinent to the indexing of the story.4 “There is no doubt about it: the processing and communication of narrative data will cover … most of the domains to which the ICTS are applied: multidimensional data, digitized documents, groupware, software, representations of knowledge, dialogue and interactivity, human learning and training environments, and so on.”5 Neo-management’s eclectic enthusiasm for storytelling leads companies to think of themselves as narrative-performative spaces in which stories and tales replace or replicate internal regulations and time-clocks.
Given that the technostructure that once managed the technical synchronization of production can no longer handle these flows of information, computer-assisted storytelling appears to be the solution to many problems. It supposedly improves staff loyalty and commitment, orients and channels flows of information and the transmission of knowledge, allows experiences to be shared and incorporates qualitative, informal, and even subjective data. The in-house applications of storytelling go hand in hand with the trend to require everyone to talk about their lives and work, to transmit their skills, to mobilize their energies, and to accept change.
Many studies carried out since the early 1980s have analyzed the crisis in big bureaucratic and hierarchical organizations and have demonstrated that the collapse of the Fordist model of post-war industrial capitalism has led to the emergence of a new model for a decentralized, flexible company that is structured into networks and focused on its core activity. This is an organization made up of autonomous agents who can take decisions and adapt to an uncertain environment. The new company is often likened to a project agency similar to a Hollywood production. It involves a mode of cooperation that is limited in both time and space, characterized by the performative logic of “one-offs” (or what marketing calls “experiences”) and which excludes series, status, and careers.
This new generation of companies will be the figurehead of the new finance capitalism (euphemistically, but unscientifically, dubbed the “new economy”). These “mutant” companies represent capitalism’s new age, which the American economist Jeremy Rifkin describes as “cultural” in The Age of Access.6 They are usually characterized by their ultra-rapid growth (start-ups), their mastery of new technologies, their sector of activity (the tertiary sector, assuming that it includes pension funds and banks), and their reliance on “knowledge” character (to use what is already a dated conception of the knowledge economy), or “learning” to use a more recent concept of knowledge management.
Yet none of these categories allows us to understand the similarities between Apple and Starbucks, Enron and Nokia, Motorola and Google, Danone and Renault. And according to James B. Twitchell’s Branded Nation, the list has to be extended to include some religious communities (such as the Willow Creek “megachurch”), great American universities such as Harvard, and even the Metropolitan Museum of Art and the Guggenheim Foundation.7 Some management theorists, like David M. Boje describe them as “storytelling” organizations. “Every workplace, school, government office or local religious group is a Storytelling Organization. Every organization, from a simple office supply company or your local choral company, to the more glamorous entertainment organizations such as Disney or Nike, and the more scandalous such as Enron or Arthur Anderson, and even McDonald’s are Storytelling Organizations.”8 In such organizations, stories are regarded both as a factor in innovation and change, a vector for learning, and a tool for communications. Storytelling is both a response to the crisis of meaning within organizations, and a method that can be used to construct a company identity. It structures and formats communications for both consumers and shareholders.
Storytelling is a more complex operation than it might seem at first sight. It is not simply a matter of telling employees’ stories, or concealing reality behind a veil of deceptive fictions. It is also a matter of using a set of shared beliefs to encourage loyalty and to manage flows of emotion, or in other words of creating a constraining collective myth:
Stories can be prisons … In the family, we have certain roles to play, certain scripts that get acted out over and over again. Some stories are absolutely addictive and we get hooked on playing our characters and waiting for that climactic moment when we get to play our favorite scene. Stories and storytelling can become part of the panoptic gaze and the hegemony of power. What, then, is a story? And what does it mean “to follow” a story?9
We can now understand why narrative has become one of management’s main concerns: no matter whether it is applied to the coordination of tasks, the interaction between technologies, the sharing of practices, or the encouragement of change, storytelling is assumed to be a way of policing behaviors and teaching people to accept the need for change. It is at once a marketing tool, a tool for personnel management that helps to mobilize (and not just motivate) managerial strata, a way of regulating social relations, of transmitting knowledge, of crystallizing a brand’s image and of selling products. It is also a keeper of memory and a support for strategic projects, communications, and action, a vector for experience and innovation, a tool for training leaders and a school of obedience, a crucible for forging an identity and a catalyst for change.
The power of neocapitalism (and its symbolic violence), which is often misunderstood, no longer has to do solely with the synchronization of capital and labor, as has been the case ever since the Industrial Revolution; it consists in creating fictions that have the power to mobilize and involve “partners”—employees and clients, managers and shareholders—in premeditated scenarios. Assembly lines are replaced by narrative spirals. Control and discipline give way to what is supposed to be a shared collective story. Storytelling can therefore be defined as the set of technologies that organize this new productive “verbosity,” which is replacing the silence of the old workshops and factories. Neocapitalism’s ambition is no longer to accumulate material wealth but to saturate fields of symbolic production and exchange, both inside and outside the company. Once it has been adopted by one division in a company, storytelling invades the others: marketing, in-house communications, “human resources” management, leadership training, strategy, project management and, more surprisingly still, financial management.
Enron: A Fabulous Story From Wall Street
“It’s a fabulous, fabulous story…” That is how Enron’s CEO ended a TV advertisement for the company in the spring of 2001, just a few months before it went bankrupt in such spectacular fashion. Enron was at the time the seventh biggest company in the USA, with an estimated value of almost $70 billion. One of the finest flowers of the “new economy,” its shares were a favorite with investors and financial analysts, and for six years running it was Fortune magazine’s “most innovative company.” The price of its shares had soared by 90 percent in 2000, when the Internet bubble burst. Shortly afterwards, its share price collapsed.10
According to Bethany McLean, the Fortune journalist who was the first to express doubts about the giant Enron’s financial solidity, the company was in fact a house of cards. The fabulous story of Enron is probably the most illuminating example of how the capitalist company has been transformed into a phenomenon of shared belief. It reveals the paradoxes and dangers of corporate storytelling, which had one of its most phenomenal successes with Enron. It was followed by an unprecedented financial disaster. Enron saw its assets go from $10 million to $65 billion within a space of 16 years. It took it 24 days to go bankrupt. Twenty thousand employees lost their jobs; $2 billion in pension and retirement funds disappeared.
Although the management gurus were quick to use Enron as a counterexample when it went bankrupt, what led the company to be so out of touch with financial and accounting realities and to confuse reality and fiction to such an extent that its own executives were brainwashed has to be explained without resorting to legal (lies, fraud) or ethical (cynicism, greed) criteria. When the Enron executives went on trial in 2006, the experts could not understand their failure and explained the biggest American bankruptcy since the 1930s with banal talk of a financial panic.
This model company, which was, according to the experts, run by the best brains in the United States and which had planned the future of energy and electricity, is the most striking example one could hope to find of the “fictional companies” that made storytelling their raison d’être and Wall Street their theater of operations. Enron had become a veritable financial mirage that fostered illusions not only amongst its employees, who had a vested interest in its growth, but also amongst the biggest banks in the world and Wall Street’s financial analysts, accountants, and shareholders.
“In the public eye, Enron’s mission was nothing more than the cover story for a massive fraud. But what brought Enron down is something more complex—and more tragic … The story of Enron is a story of human weakness, of hubris and greed and rampant self-delusion.”11 It is the story of Ken Lay, a man from a poor family and the son of a preacher who, as a boy, dreamed of making a fortune. According to legend, that dream began when he was four or five. In the film adapted from McLean and Elkind’s book, we see a photo of the young Ken Lay perched on a tractor and dreaming for the first time, we are told, of the world of commerce. As ambitious as he was brilliant, he studied economics and, as soon as he had graduated, went to Washington to “change all that.”
We are in the 1980s, and Ronald Reagan is president. In the film, we see Reagan giving a speech that appears to have been written by or for Ken Lay: “Government is not the solution to our problem. Government is the problem. The societies that have achieved the most spectacular broad-based economic progress in the shortest period of time are not the most tightly controlled, not necessarily the biggest in size or the wealthiest in natural resources. No, what unites them is their readiness to believe in the magic of the marketplace.”12 The man George W. Bush nicknamed “Kenny Boy” began one of the most fervent advocacies of deregulation in the energy markets and launched a crusade to “liberate businessmen.” In 1985, he took advantage of the government’s decision to float gas shares to found Enron. In 2000, Kenny Boy was one of the most generous contributors to George W. Bush’s presidential campaign.
Ken Lay recruited Jeff Skilling as CEO. Skilling’s idea was to distribute energy in a new way and to transform it into financial instruments that could be traded like shares. “He was the prophet,” recalls a woman who worked with him. “He said forget about this pipeline stuff, you know, the state pipelines in the ground.” Enron became a “stock market” for natural gas. Jeff Skilling had a very specific idea of what Reagan called the “magic of the marketplace.” He was the magician. Before he took over as CEO, he laid down one condition: the accounts had to be based upon mark-to-market accounting and not historical values. Arthur Anderson’s accountancy consultancy accepted his conditions. Mark-to-market accounting means that the balance sheet shows, not real profits, but the entire estimated value on the day the contract was signed, or in other words likely values and hypothetical returns. To the outside world—explains the only financial analyst to have expressed his scepticism (he was sacked as a result of the pressure brought to bear by Enron)—this meant that Enron’s profits were what Enron said they were: “They were saying we are going to sell power from this power plant in ten years for so many dollars per kilowatt, and there was no way to prove that they could do it.”13
Jeff Skilling’s idea of accountancy was fictional. By freeing himself from historical values, he transformed accountancy into an enchanted world.
In a company film that was presumably meant for in-house communications, Jeff Skilling can be seen playing himself and parodying the method of valuing market prices: “We’ve really pulled out all the stops. Origination: we did $20 million last year; I think we can do $120 million. Trading: $10 million. We can do $64 million this year. This is the way we’re going to move from mark to market to what I call HFV (hypothetical future value) accounting. If we do that, we can add a gazillion dollars to the bottom line.” He then bursts out laughing.
David M. Boje, the American storytelling specialist who has already been cited so often here, notably with reference to Nike, obviously took an interest in this archetypal story. He and his colleagues studied the Enron saga at length in order to “examine how statistics in financial reports and executive metatheatric presentations were used to recommend Enron stock … how professionals tell stories with numbers [and] show the important role the rhetorical construction of financial measures played in the Enron failure.”14
Stories: The Financial Manager’s Best Currency
The Enron affair is symptomatic of the close relationship between a capitalism that is obsessed with the quest for short-term profits and the recourse to the sirens of storytelling as a way of justifying its actions. The financialization of economies since the 1980s, which was triggered by the growth of pension funds and institutional investors, has produced what the radical American economist Bennett Harrison calls “impatient capital”: investors adjust their investments in the very short term and evaluate the returns in terms of share prices rather than dividends.
“Whereas in 1965,” notes Richard Sennett, “American pension funds held stock for an average of 46 months, by 2000 much in the portfolios of these institutional investors turned over on an average of 3.8 months.”15 At the same time, as Nigel Thrift explains: “Public relations became a crucial determinant of many aspects of economic life … and increasingly, therefore, economic life came to resemble media industry with fashions, stars and favorite stocks.”16 The same point is made by Alicia Korten and Karen Dietz, who argue that “story is the new currency in financial management”:
In the world of finance, storytelling plays a vital role. “You won’t get someone investing time and capital with just facts. It takes more than numbers if there’s a decision on the table. Attracting investors is about being a good storyteller,” says Dan Hendrix, president and CEO of Interface, Inc., the world’s largest manufacturer of modular carpet and a leader in the sustainable business movement. Dorothea Brennan, board member for Gaylord Hospital, a long-term acute care hospital, agrees: “Stories are vital for giving meaning to numbers. They provide context and capture people’s imagination.”17
During the 1990s, share prices broke free of companies’ results, and the share price of companies that were not making a profit rose. “Enormous pressure was put on companies to look beautiful in the eyes of the passing voyeur; institutional beauty consisted in the demonstrating signs of internal change and flexibility, appearing to be a dynamic company.”18 It is not often that a prosperous company fires 10 percent of its employees every year. Enron’s staff were ranked on a scale of one to five. Every year, 10 percent achieved the lowest score and were fired. Conversely, a twenty-five-year-old who was well-rated could come out of the CEO’s office with a bonus of $5 million.19
The more the world of finance distanced itself from rational forecasts and economic success, the more the business cosmetics that makes companies look beautiful and desirable to investors became an important part of the management of these new organizations. Their “beauty” was in fact based upon the stories that told of restructuring, downsizing, and outsourcing.
The theme of Enron’s last advertising campaign in 2001 was… market transparency. It was released a few weeks before the company went bankrupt; it showed traders in front of computer screens screaming “Buy” orders into their cell phones. A voiceover explains: “Enron Online… is creating an open transparent market that replaces the dark, blind system that existed beforehand.” The film then cuts to a group of blind people wearing Disney masks, feeling their way with white sticks and assisted by guide-dogs.
In a rational world, this exemplary fiasco would have signalled the death of storytelling and its hypnotic values. And yet, almost ten years later, storytelling is—more so than ever—the management guru’s bible. But it is also the bible of the spin doctors and “political gurus” who, with increasing success, have long been importing the methods of storytelling management into the United States (and many other countries).