Passport to the 21st Century
John Seely Brown, Steve Denning, 
Katalina Groh, Larry Prusak: 
Some of the world's leading thinkers
explore the role of storytelling in the world

 I Introduction to storytelling I John Seely Brown on science I Steve Denning on change I Katalina Groh on video
Larry Prusak on organization I Discussion I | Contact us | Bibliography on storytelling

Storytelling in Organizations: Larry Prusak
II.C. Stories about the organization 

   Then there are stories about the organization. 

The story of RumorMill at Chemical Bank

   If you want a great example of this, and this is a true-life story, there was once a company called Chemical Bank. It merged into another bank. And then yet again, became a third bank. But there used to be a big bank called Chemical Bank, a big powerful New York bank. And they had a new CIO, Bruce Hassenjager, Chief Information Officer, powerful guy, an IT guy, smart guy too. And he 

looked at all these systems that the bank was always building, and he said, “Let’s try something different.” He had found that a lot of people were worried, as this was the era when one bank was merging with another bank, and a lot of stories were going about, and rumors. So he said, “Why don’t we put up a system called RumorMill?” An IT system called RumorMill. Harvard Business School wrote a case about this. It’s true. In this system, he said, “If you type in a rumor, I’ll get you an answer in 24 hours.” You’d send it to him, via the system. It wasn’t quite email. It was a little before email, but you’d use it like email.

     Well, the first time he let people know that this system was up, he got about five inquiries. And he got answers back to them. He was an executive. He was on the management team. So he sent them back answers. 

    Once people thought the system was reliable and reasonably honest, the next week he got about a hundred inquiries. Now some of these, he could batch together. They weren’t all separate questions. You could put a whole bunch of them together. “Are we merging with Chase?” Or “I heard we’re going to go bankrupt. Is it true?” “Are we getting a new CIO?” The sort of stuff you could imagine. He answered most of them. And then he had to put on one of his people to help him. But he managed to get answers to most of them. But sometimes he couldn’t. Sometimes he had to say, “Look, I’m sorry, I’m afraid this is still secret information. I really can’t answer it.” That was fine. People could live with that. 

   The next week, he got 4,000 inquiries. (Laughter) And he had to shut the system down and he left after a few months. (Laughter

The bottled-up need for information

    What’s interesting about that is the evidence of the bottled-up need for information. I mean, here is a bank run by traditional models, having all the traditional systems, with a pent-up demand for information about their own organization that was so huge that it swamped the system and swamped Bruce. I think that’s true for every organization. Maybe less true than it used to be. But if you did something like that in IBM or GE or GM or the Navy or any organization, the same things would occur. People don’t know what’s going on. So they tell stories. In this case, it was the Delphic Oracle. You could tell the story and get an answer. (Laughter) An authoritative answer. And it’s on a screen. And it’s from an executive. So people said: “Wow! This is great stuff!” 

Participant: How much of that do you think was due to the illusion, or maybe even the fact of anonymity: that the people who were posting these questions could hide behind anonymity? 

Larry Prusak: I don’t think it was that so much. They were really curious. You know, there’s a very well-known academic researcher called Carl Weick who wrote a wonderful book called Sensemaking in Organizations (Thousand Oaks: Sage Publications, 1995). He said that the strongest impulse in many organizations is to make sense of the organization and the environment. I don’t think that’s the total truth, but it’s a big piece of it. People can’t make sense of their own firms. 

   So there are stories about the organization. Not about work, but about the organization that you work in. Which is often like: “How did that jerk get promoted?” (Laughter)  “What happened to the stock?” Or:  “Why has our pension gone?” Or: “What’s going on in this firm?” 

    I find this myself. I’m an executive in IBM at a senior level, and yet I have to read the newspapers to find out what goes on in IBM. No one tells me. I’m not making this up. I read in the newspaper, and I see: “Oh, we bought this firm! We did that? That’s interesting!”  You know, I’m a stockholder and a stakeholder, but there’s no way that they can get the news to me. I once met the Senior Vice President for Communications, and I asked him, “What the hell do you do for a living?” (Laughter) I’m serious. He was deeply offended. He outranked me by two degrees. So he wouldn’t answer. (Laughter) I’m not singling out IBM. It’s a good firm. 

    So people love telling stories about their organization, and not from maliciousness. One of the impulses is to retain your buddies. People want to keep their networks and communities intact. I think that’s one of the great impulses of why people tell stories. It’s to retain those in the organization you want to keep there. The researchers are coming to a more community-based or network-based theory of the firm. John has written about this. Steve and a number of us have. Firms are really social communities, and it’s very important to keep these communities intact to get coherence and cohesion.  So when you tell stories about the organization, it’s often a bonding mechanism.


Participant: One of the things that strikes me is that stories need a context. They need to be told in a time and at a place. 

Larry Prusak: Absolutely.

Participant: How does that fit into the motive to tell a story. Because I may have a story and not want to tell it and then find the time when I do want to tell it.

Larry Prusak: Well, “ripeness is all”* as Shakespeare said . Timing is very important. There are certain timeless stories. Again, if you were to do discourse analysis and collected all the stories told in every organization in the world for five years, you’d find there are timeless stories. Stories like, “Us against them” or “I do all the work around here” or “The rewards are disproportionate to the efforts.” So there are certain tales or myths or legends that are perennial in organizations. You find them in Hammurabi’s code** . You find them in the Bible. You find them in the Iliad and the Odyssey. The asymmetry of rewards and effort. They’re timeless. 

    Then there are contextual stories, stories that are true for the moment. Like the RumorMill at Chemical Bank. Stories that constantly go on in organizations. So there is a sort of constant tension between eternal tales, which are stories like “Woe is me!”. There are probably six or eight eternal themes. And then there are more temporal stories. 

Participant: Aren’t there stories told specifically to certain kinds of people rather than to just anyone. Some stories are very situational. 

Larry Prusak: Oh yes, that’s true. I’ll get to that in a minute.\

*William Shakespeare: King Lear, Act V, Scene 2

Edgar. Away, old man! give me thy hand! away!
     King Lear hath lost, he and his daughter ta'en.
     Give me thy hand! come on!
Gloucester. No further, sir. A man may rot even here.
  Edgar. What, in ill thoughts again? Men must endure
     Their going hence, even as their coming hither;
     Ripeness is all. Come on.
  Gloucester. And that's true too

**Hammurabi's Code 

Hammurabi was the sixth and best-known king of the Amorite Dynasty of Babylon around 1792-1750 BC or earlier. Examples of his decisions were collected towards the end of his reign and inscribed on a diorite stela in the temple of Marduk. 

Books and videos on storytelling 
*** In Good Company : How Social Capital Makes Organizations Work
by Don Cohen, Laurence Prusak (February 2001) Harvard Business School Press
*** The Social Life of Information, by John Seely Brown, Paul Duguid
(February 2000) Harvard Business School Press
*** The Springboard : How Storytelling Ignites Action in Knowledge-Era Organizations
by Stephen Denning (October 2000) Butterworth-Heinemann 
*** The Art of Possibility, a video with Ben and Ros Zander : Groh Publications (February 2001)
Copyright © 2001 Larry Prusak 
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