Magical Thinking as Organizational Dysfunction

Many organizations attempt to work and manage by using strategies and tactics that cannot achieve the goals for which they were designed. We call this phenomenon magical thinking, which means believing that unrealistic organizational strategies and tactics can be successful. In this paper, we explore the nature of this phenomenon, provide some examples of magical thinking, and posit a theory about why magical thinking is common in organizations. Finally, we propose that the management tools, used in Socio-Economic Approach to Management (SEAM), serve to reduce the proliferation of magical thinking in organizations.

Key words: magical thinking, socio-economic theory, organizational neurosis, TFW virus, SEAM management tools