UK: Management Lessons From Hollywood - Psychology is the key to business.

UK: Management Lessons From Hollywood - Psychology is the key to business. - Psycho, Alfred Hitchcock's 1960s masterpiece, is a parable of modern business practice. Don't let your competitors cut you up, says Rhymer Rigby.

Last Updated: 31 Aug 2010

Psycho, Alfred Hitchcock's 1960s masterpiece, is a parable of modern business practice. Don't let your competitors cut you up, says Rhymer Rigby.

The shower scene in Psycho, Hitchcock's classic '60s thriller, has a legitimate claim to being the best-known moment in cinema. Considering that many companies fear they'll 'take a bath' in the next financial year, and that some believe Hitchcock to be the master not only of the flesh-creeping flick but also of the disguised fiscal parable, perhaps there are business lessons to be learnt from his cinematic masterpiece.

The film revolves around the Bates Motel, a business in managed long-term decline. Norman Bates, the chief executive, appears to be trying desperately to modernise a moribund organisation. Although he has adopted many forward-thinking processes, an antiquated board structure and overly powerful chairwoman seriously limit his ability to manage change effectively. In the course of the film, customer-relations problems bring this situation to a head, though ultimately, the outcome is ambiguous. Some would argue that Bates loses everything; others would insist his careful, covert manipulation of governance issues leaves him in a win-win situation.


It is may be the oldest cliche in business but you'd be amazed at the number of people who still think that there is such a thing as a free lunch - or, in Leigh's case, a free supper. Ignoring the first rule of commerce, Leigh accepts Bates' dinner invitation and, over a frugal (non-expense account) sandwiches and milk, he begins to entertain thoughts of a merger. The chairwoman of Bates' Inc is suspicious of this hastily scheduled meeting and decides that Leigh must pay a high price for attempting to do business with her son. Leigh's surprise when confronted in the shower by a knife-wielding nutter can be explained by her ignorance of the true cut-throat nature of the business world.


Although demonstrably modern in many of his attitudes to business, Bates is very much a '60s man when it comes to waste disposal. He simply dumps anything he wants to get rid of (cars with bodies in the boot, for instance) in the local swamp; perhaps calculating that the fine for illegal dumping is less than the costs of recycling. However, it is interesting to note that in later films such as Goldfinger and Pulp Fiction villains manage to dispose of corpse-filled cars in more eco-friendly ways - by crushing them, for example. Had Bates shown a little 'good corporate citizenship', instead of polluting a local wetland, he might have stood less chance of being convicted for his crimes.


Throughout the film's first half-hour, Janet Leigh shows a lamentable inability to manage her stress levels. Having taken out a unilateral non-returnable loan of $40,000, she is abrupt to a concerned policeman, arousing his suspicions and compounding her problems. Next, she refuses to haggle with a second-hand car salesman. Again, her unnatural behaviour causes him to question her probity and causes further stress. Both these situations were foreseeable. Even minimal preparation would have completely prevented any such difficulties. Her failure to plan ahead means she is nervous, tired and at a considerable disadvantage for what turns out to be a surprisingly important business meeting with Bates.


In today's increasingly competitive world, it is no longer enough to have only one sharply defined role. Business demands flexibility and the early days of demarcation are gone for good. Not only is Bates the managing director of the Bates Motel, with responsibility for the company's day-to-day running but he is soon forced to take over the chairperson or 'mother' role, which involves strategic planning and inculcating corporate values. Indeed, so completely has Bates embraced the flexible workplace, that he is quite capable of holding a boardroom meeting alone, lucidly discussing the issues with himself (and perhaps a representative of his mother) and rationally arriving at the right decision for the business.


After Bates' arrest, the police psychiatrist explains that, having grown up unhealthily close to his mother and worked alongside her, Bates went on to commit matricide and - traumatised - 'became' his mother. It is easy to be wise after the event, but these are all problems a good company doctor could have prevented. If a trouble-shooter had been called when tensions first became apparent, he would probably have put a couple of experienced non-execs on the board and repositioned the motel upmarket. Had this been done (and had a policy of mixed organic growth and acquisitions followed), Bates would doubtless now be a NASDAQ chief executive and his mother emeritus professor of leisure economics at Harvard.

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