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 / Second Quarter 2002 / Issue 27(originally published by Booz & Company)


Once Upon a Time

In business, stories are useful in many kinds of communication — to explain, inspire, educate, train, convince, schmooze, mentor, and, obviously, entertain. Stories used in a business context are perhaps most widely thought of as a means to sustain company cultures. Hero stories abound in corporations, for example, stressing integrity in the face of an ethical dilemma; extraordinary service that delights and surprises the customer; and empathy and kindness extended to employees by their leaders.

Peg C. Neuhauser, author of Corporate Legends & Lore: The Power of Storytelling as a Management Tool, tells the story of the hospital CEO who visited shivering steelworkers who were erecting an addition to the hospital in the middle of winter. He took pity on their discomfort and installed free coffee and hot-chocolate vending machines at the outdoor work site. In so doing, the CEO reinforced the caring culture he nurtured inside the hospital. Ms. Neuhauser says such stories become part of the “sacred bundle” of tales that guide employees in how to act toward customers, vendors, and each other.

Yiannis Gabriel, author of Storytelling in Organizations: Facts, Fictions, and Fantasies, suggests the power of culture-reinforcing tales. One of his stories goes like this: A new CEO has just joined a struggling corporation. Right before meeting with his vice presidents, he uproots a sign in the parking lot that reads “reserved for the CEO.” He throws it on the table at the meeting and asks who put up the sign — and all the other signs reserving spots for the VPs. “This is not the kind of leadership I will have around here,” he says. By week’s end, he fires the offending executive.

Perhaps the most powerful role of stories today is to ignite and drive changes in management policy and practices. Mr. Denning describes his use of stories — imaginative anecdotes, really — to change his organization from being solely a lender of money to also offering its expertise in project implementation. The World Bank’s clients, the poor nations of the world, need more than loans these days; they need knowledge about how to use those loans wisely. To help staff visualize what it means to provide implementation knowledge to clients, Mr. Denning relied on what he calls “springboard stories” — “sketchy vignettes that suggested a new vision and set of values for future client service.”

Mr. Denning’s goal was ambitious. He wanted the anecdotes he told to stir fresh ideas among the staff about how, placed in analogous situations, they would triumph over problems similar to those described in the stories. Yet Mr. Denning says the story he used in 1996 to launch his change effort was based on the slimmest material. It didn’t even come from the World Bank. A colleague told Mr. Denning how a health worker in Kamana, Zambia, was struggling to find a solution for treating malaria. In this tiny and remote rural town, the health worker logged on to the Web site of the U.S.’s Centers for Disease Control and Prevention and got an answer.

“This true story happened, not, as if in a fantasy, in 2015, but in June 1995,” Mr. Denning recounted. “This is not a rich country: It is Zambia, one of the least developed countries in the world. But the most striking aspect of the picture is this: [The World Bank] doesn’t have its know-how and expertise organized so that someone like the health worker in Zambia can have access to it. But just imagine if it did!”

Mr. Denning knew he didn’t have to spell out his entire message. World Bank employees, who work in the most impoverished locales on earth, could picture themselves elbow to elbow with poor professionals like that health worker. They knew what it was like to be asked a question by a local worker and not be able to give the kind of answers expected from a World Bank employee. By helping employees paint this scene in their minds, Mr. Denning made them realize that the status quo was untenable, which encouraged them to take action.

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