Core Group Theory
(Kleiner)

Knowledge Center

   

What comes first in every organization? Keep the Core Group happy. Explanation of Core Group Theory of Art Kleiner.

Contents

Premium

The actual objective of the modern corporation

Kleiner makes the bold statement that what comes first in every organization is: keeping the Core Group satisfied (normally most of the top managers). And yet, according to Kleiner, Core Groups are not inherently bad or dysfunctional. They are rather necessary and even the best hope we have for ennobling humanity, since organizations are natural amplifiers of human capability. An organization's Core Group is also the source of its energy, drive and direction. Or more accurately, any organization goes wherever its people perceive that the Core Group needs and wants to let it go. Non-members depend upon the Core Group for direction. The Core Group and its members depend upon the non-members for their legitimacy.


Core Groups are normally not mentioned in any organization chart. Compare: Organization Chart. They exist only in people's hearts and minds. After some time, organizations will resemble their Core Group and act like it. And automatically pivot and twist to give the members of the Core Group what they think they want and need, without even asking them. Great Core Groups hold an essential form of knowledge. They set the context that establishes this knowledge as significant.


How do Core Groups become so powerful?

Kleiner explains that the mechanism is based on guesswork and amplification. People who are not in the Core Group try to guess what it is the Core Group wants. So even a casual remark in passing by a Core Group member can be amplified to a shift of direction of an entire division. As a consequence, top managers need to be very cautious in what they say. According to Kleiner, concepts like the Balanced Scorecard do not really change this. Although more objective measurements may be used and there is better strategic communication top-down, still a lot of guesswork remains: people assume that they should interpret the numbers according to what they perceive the Core Group really wants, And people also assume they should interpret the Core Group according to the numbers: if the measurements send a clear signal, then people assume that is where the Core Group wants the organization to go. According to Kleiner, Core Group dynamics also prevent organizations from changing easily. Both the Core Group and the non-core employees are interested in maintaining the status quo.


Expanded Core Group Organizations

Kleiner suggests that is it is possible to create "Expanded-Core-Group Organizations". To do this, the following elements are suggested:

  • Employee securities (stock) ownership plans.
  • Financial literacy.
  • Non-hierarchical decision-making.
  • Comprehensive (financial and strategy) training programs.

This is where Core Group theory is not unlike Value Based Management thinking.


As far as the Value Creation part of VBM is concerned, it is important to decide whether an organization should aim primarily at maximizing shareholder value, or to take the position that in reality the Core Group comes first. The last is essentially a form of Stakeholder Value Perspective. Thus Core Group dynamics can provide an explanation for the phenomenon in which companies, despite having adopted the maximizing shareholder value philosophy, are not being very responsive to shareholders needs. Sometimes Core Group members believe mistakenly, that the organization's first task is to keep up the share price. The easiest way of doing that is: the presentation of slowly but steadily growing positive quarterly results. Through guesswork and amplification the entire organization will follow a Core Group that makes this serious mistake. The organization will support the Core Group in providing a manipulated and wrong picture of the reality instead of what really should be done: taking decisions that maximize shareholder (or stakeholders) value. Compare: Seven Signs Of Ethical Collapse


Book: Art Kleiner - Who Really Matters -


Core Group Theory Special Interest Group


Special Interest Group (18 members)


Core Group Theory Forum  

Recent topics

  Key Assumptions of the Core Group Theory
Kleiner says that the Core Group Theory (CGT) holds for both for-profit organizations and non-profit organizations. The theory helps to clarify certai...
     
 

Best Practices - Core Group Theory

Expert Tips - Core Group Theory
 

3 Causes of Disagreement in Team Decision-making Processes

Group Decision-making, Team Decision-making, Reasons for Disagreement, 3 Fs, Group Collaboration
According to Freeman and Haskins (2014), there are three main categories of potential root causes fo...
 
 
 

Why is Changing an Organization Culture So Hard? The ASA Model (Schneider)

Organization Culture, Culture Change, Corporate Culture, Change Management, Recruitment
Why is changing an organization culture so difficult? Because, once it is established, a culture has...
 
 
 

The Relationship between the Power of Leaders and Overconfidence

Leadership, Power, Leadership Development, Executive Education
Fast et al. (2012) researched the relationship between power and overconfidence. In many cases it ca...
 
 
 

Mobilize the Expertise in your Team Early On

Team Formation, Expert Power, Group Decision-making, Extroversion, Introversion
In a short article, Bonner and Bolinger describe a surprisingly simple process to beef up the proble...
 
 
 

Kleiner’s Core Group Theory versus Thompson’s Dominant Coalition on Decentralization

Mechanisms Behind Core Groups and Dominant Coalitions
In the article ”Core Group Theory and the emancipation agenda” the CGT of Kleiner and the Dominant C...
 
 
 

Who really matters? Who is in my Organization's Core Group?

Strategy, Leadership
In order to find out which people are in the core group of your organization, Art Kleiner suggest as...
 
 
 

Pluralistic Ignorance and the Abilene Paradox

Problems in Group Decision Making
Pluralistic Ignorance can be described as a situation in which a certain person has an opinion, but ...
 
 
 

The Role of the CEO in Strategic Change Initiation

Communicating Strategic Change
In management literature the role of the CEO in formulating and implementing strategic change has of...
 
 
 

PROs and CONs of a Strong Corporate Culture

Corporate Culture Change, Change Management, Organizational Change
Implementing a significant change is generally easier when the corporate culture is not strong. By s...
 
 
 

Am I in the Core Group?

Strategy, Leadership
Art Kleiner suggests asking yourself following questions in order to find out if you are in the core...
 
 

Resources - Core Group Theory

Power and Politics in Organizations

Power Relations, Bases of Power, Political Behavior, Politics, Political Tactics, Organizational Politics
This presentation covers the topic of politics in organization, especially focusing on power issues....
 

The Fatal Coaching Mistake by Managers

Coaching, Mentoring, Management, Leadership
Managers and executives often don't realize how much influence they have over their staff, by just ...
 

Group Conflicts, Group Cohesion and Groupthink in Decision Making

Group Decision Making, Conflicts in Groups, Cohesion of Groups, Groupthink
Presentation about conflicts and cohesion in groups, and how it influences decision making. The pres...
 

Avoiding Group Biases: The Pre-Mortem Technique

Group Decision Making, Avoiding Group Biases, Group Think, Tunnel Vision
Nobel laureate Professor Emeritus Daniel Kahneman explains the Pre-mortum approach by Gary Klein to ...
 

Group Influences and Opinion Leadership

Groupthink, Group Dynamics, Word of Mouth Marketing, Sales, Opinion Leadership, Convincing People, Persuation
Presentation about Group Influences, including various related concepts such as the Social Compariso...
 

10 Leadership Theories in a Nutshell

Leadership Theories Overview, Leadership Development, Management Development, Leadership Styles, Coaching, Mentoring
This 5-minute video gives a brief overview of 10 theories of leadership, explaining their main diffe...
 
 

News about Core Kleiner


     
 

News about Core Organization


     
 

Videos about Core Kleiner


     
 

Videos about Core Organization


     
 

Presentations about Core Kleiner


     
 

Presentations about Core Organization


     
 

Books about Core Kleiner


     
 

Books about Core Organization


     
 

More about Core Kleiner


     
 

More about Core Organization


     

Compare with:  Groupthink  |  Spiral of Silence  |  Organization Chart  |  Organic Organization  |  Bases of Social Power  |  Levels of Culture  |  Appreciative Inquiry  |  Positive Deviance  |  Changing Organization Cultures  |  Culture Types  |  Contingency Theory  |  Framing  |  Charismatic Leadership  |  Servant-Leadership


Return to Management Hub: Change & Organization  |  Communication & Skills  |  Ethics & Responsibility  |  Human Resources  |   Leadership  |  Strategy


More Management Methods, Models and Theory

Special Interest Group Leader

You here? Sign up for free


 


About 12manage | Advertising | Link to us / Cite us | Privacy | Suggestions | Terms of Service
© 2019 12manage - The Executive Fast Track. V15.0 - Last updated: 17-2-2019. All names ™ of their owners.