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Fast and Frugal
| Joseph Stiglitz | Won'tWork | Beyond Tattoos and Hoodies | Cultural Misfits
Quote of the Moment
Fast-and-frugal robust heuristics may not be a second-best option but rather ‘rational’ responses in complex and changing macroeconomic environments.
When being rational is too slow.
I’ve written in the past that WeWork’s business strategy is a house of cards: buying on long-term office leases and selling short-term office subleases is precarious, and when there is a dramatic decrease in demand for office space, the bottom will fall out.
No surprise, then, that WeWork is in free fall, as reported by Reuters:
WeWork said on Thursday it will exit about 40 locations across the United States and forecast current-quarter revenue below estimates as the flexible workspace provider faces high expenses and a strong U.S. dollar.
The company has been working to curb its real estate footprint and reduce headcount as it grapples with long-term lease obligations that stood at $15.57 billion as of September-end. Some of WeWork's tenants, in contrast, are only on short-term leases.
WeWork went public in 2021 after a two-year struggle and currently has a market cap of around $1.77 billion. Its pre-IPO valuation was once pegged at nearly $50 billion.
Its shares were down 1.6% at $2.39 in premarket trade on Thursday.
Beyond Tattoos and Hoodies
Gina Cheralus tracks a new business clothing trend: crop tops in the office.
The traditional office dress code has long been over. Visible tattoos are acceptable and bluejeans and sneakers have become the norm in many workplace settings. Even rigid banking firms like Goldman Sachs and JPMorgan Chase have eased up in recent years to embrace casual fashion. And look, Jason Sudeikis isn’t the only person wearing a hoodie to work events.
With employers offering incentives to get workers back in the office and the skyrocketing costs of, well, everything, the next evolution in our workplace wardrobes might just be the freeing of the midriff
On recent weekdays in Midtown Manhattan, many women were spotted wearing crop tops as part of their work attire during the evening rush hour.
Preventing workplace harassment is typically one of the chief reasons for a dress code, a tool with which employers try to protect employees from unwanted distractions and comments from others — an even greater priority since the #MeToo movement began. But when it comes to wardrobe, many believe that a respectful workplace is the responsibility not of the employee selecting an outfit in the morning, but of their colleagues not to be inappropriate.
“The choice should be left to the individual,” Ms. [Santina] Rizzi said, adding, “In my experience, men will be gross no matter what you’re wearing.”
Of course, a lot of people will squawk, because businesses are inherently conservative, and clothing is about more than covering skin. Clothing is also more than just self-expression: it’s intended to show adherence to cultural norms, and not break them.
I found myself nodding along with the sane commentary by crop topper Santina Rizzi, about both choice and men.
I plan to create a Substack Chat on this topic this afternoon. Stay tuned.
I uncovered an older post, Models, Models, Models, when I was searching for Adam Grant’s ‘Givers versus Takers’ model:
A wellspring of insights can be tapped in The New Analytics of Culture, by Matthew Corritore, Amir Goldberg, and Sameer B. Srivastava.
I reread the article recently — it was published in 2020 — when I happened to search for the term “cultural misfits”, not remembering who had introduced me to that term. The authors were interested in new ways to assess organizational culture and employees’ place in their work milieu.
The authors touch on a number of subjects, and then light on the question: When might it be better to hire a cultural misfit?
People who see the world differently and have diverse ideas and perspectives often bring creativity and innovation to an organization. But because of their outsider status, they may struggle to have their ideas recognized by colleagues as legitimate. In a recent study two of us conducted with V. Govind Manian, Christopher Potts, and William Monroe, we compared employees’ levels of cultural fit with the extent to which they served as a bridge between otherwise disconnected groups in the firm’s internal communication network. For instance, an employee might have connections with colleagues that bridge both the engineering and sales departments, allowing her to access and pass on a greater variety of information and ideas.
It was Ronald Burt whose work on social capital was in fact based on that insight, that people acting as bridges play a very important role:
Social capital exists where people have an advantage because of their location in a social structure. | Ronald Burt, Structural Holes
Back to Corritore, et al [emphasis mine]:
Consistent with prior work, we found that cultural fit was, on average, positively associated with career success. The benefits of fitting in culturally were especially great for individuals who served as network bridges. When traversing the boundary between engineering and sales, for example, they could hold their own in technical banter with the former and in customer-oriented discourse with the latter. People who attempted to span boundaries but could not display cultural ambidexterity were especially penalized: They were seen as both cultural outsiders and social outsiders without clear membership in any particular social clique. However, we also identified a set of individuals who benefited from being cultural misfits: those who did not have networks spanning disparate groups but instead had strong connections within a defined social clique. By building trusting social bonds with colleagues, they were able to overcome their outsider status and leverage their distinctiveness. These results suggest that an effective hiring strategy should strive for a portfolio of both conformists—or at least those who can rapidly adapt to a company’s changing culture—and cultural misfits.
So it seems that social status can come even to cultural misfits when they craft a tight network of support, and their outsider status to the larger company is offset by that close network who consider the misfit a ‘quirky innovator’ rather than ‘outlandish outsider’.
There needs to be a balance of all sorts of people — conformists and misfits — to make a culture work:
Organizations may be able to resolve the assumed trade-off between efficiency and innovation by encouraging diverse cultural ideas while fostering agreement among employees about the importance of a common set of organizational norms and beliefs.