Don't Let "Labels" Influence Management Decisions

Last Updated Aug 26, 2009 8:44 PM EDT

Perhaps the greatest tool of humanity in its quest to understand the world around it is language. But I'm not talking about language for communications; I'm talking about language for identification, for understanding. I'm talking about labels.

Labels are how we reduce complex concepts, objects and even living things to quantifiable constructs we can identify and understand. One of the first ways we recognize progress in a child is when he points to you and says "mama," although he might surprise you by saying "doggie" first.

One of the first things we do when we discover something is to name it. We name it, classify it, and categorize it. That way, we know what it is. It ceases to be mysterious. Instead, it becomes something "understood" by mankind. But is that really the way it is? Does that mean we understand it? Nope.

On the contrary, when we label, we attempt to make complex concepts simple. In so doing, we lose information that contributes to understanding. When you label a person, you reduce his thoughts, feelings, capabilities, even intentions, to a one-dimensional construct.
Of course, as in "growing up" and science, there are a number of uses for labels in business. We label people and companies we sell products and services to as "customers" so we know not to treat them like crap.

But labels can also have a negative impact on operational execution and organizational productivity, as in the following examples:

  • Polarizing organizations that should be aligning and working together (silo behavior, like sales vs. marketing, or targeting groups like HR or IT)
  • Initiating and exacerbating conflict or hindering conflict resolution
  • Prolonging and potentially undermining successful negotiations
In general, labels can have a way of stifling discussion and understanding, exactly the opposite of what's needed to resolve management issues and conflict. A perfect example is the Whole Foods healthcare debate.

Whole Foods CEO John Mackey wrote a Wall Street Journal op-ed offering suggestions for healthcare based on his company's own program. But, since his suggestions differed from President Obama's healthcare initiative, there's a movement to boycott Whole Foods stores and oust Mackey as CEO.

But why? Let's be honest. Some folks like the company's food products, even like the company's green and humane initiatives, but since the CEO has a different take on one issue, he no longer fits into their "label" and their response is to terminate their business with his company and lobby others to do the same.

But for those people, where's the healthcare discussion? Isn't that what this was supposed to be about? Nope. For them, it's all about labels. You're either with us or against us, no understanding, end of discussion.

Perhaps an extreme example, but it makes the point: When labels get in the way of effective business or management decision-making, that's bad business and bad management.