Facing reality, whether it's about Apple or the EU, is a core requirement for good management

Facing reality, whether it's about Apple or the EU, is a core requirement for good management

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Facing reality, whether it's about Apple or the EU, is a core requirement for good management

4 March 2024 – Baldur<br>Bjarnason

You can’t be a good manager or executive, in any industry, if you operate in constant denial of the facts on the ground. Arguing from ideology or beliefs that aren’t grounded in observation, measurement, or study, is the hallmark of a politician or media personality, not a manager responsible for other people’s jobs.

This should be obvious, but it isn’t.

Basing your opinion on factional loyalty and vibes is fine for a blogger or a pundit, but it does not make for a sound management strategy.

Unfortunately, it’s the default for modern executives, best seen in the popularity of mass lay-offs – a strategy that has been resoundly proven to be counter-productive, costly, even disastrous, along multiple dimensions, over multiple decades of study.

There are a few examples of this trend towards denying reality. The starkest one being Elon Musk behaving as if European labour unions don’t exist and that labour is entirely powerless, leading his companies to lose money on strikes and other collective actions.

But Elon Musk isn’t alone. It’s very common for US punditry to completely misunderstand the EU and analyse it as if it were a US political entity – imagining that its actions are driven by the same political and social dynamics as a protectionist industry within the US. They treat the EU’s actions as analogous to a coalition of traditional media companies, such as The New York Times and Washington Post, trying to bolster their industry against tech. They cover EU statements as if they were the comments of the taxi industry trying to stave off Uber and Lyft.

But that’s just not the reality of the situation and to understand what’s going on – to be able to make sound management decisions and form executive strategy – you need to understand what the EU is. More specifically, you need to understand the European Single Market.

It is trivially obvious that the management at Apple, Google, and Microsoft have not done this work. Apple especially seems to be in denial about the nature of the EU.

This should worry you, because understanding it isn’t hard – the equivalent of a single high school civics lesson – but they seem to be basing billion-dollar executive decisions on wishful thinking, and that’s a cause for concern.

The European Single Market #

The single market: bringing Europe together

One of the cornerstones of EU integration, the single market makes it possible for goods, services, capital and people to move across the bloc as freely as within a single country.

It includes both EU and non-EU countries: Iceland, Liechtenstein and Norway take part through the European Economic Area they have established with the EU, while Switzerland has concluded a series of bilateral agreements with the EU that give the country partial access to the single market.

30 years of EU single market: benefits and challenges

The single market is, from the perspective of the EU itself, its single most important project. Greater trade unity and competitiveness with other markets is the very reason why its predecessors were formed. The EU is for lowering internal barriers to trade and services while protecting that internal market with whatever tools it deems necessary.

Most of the time that has involved some sort of external barrier.

This is the reason why I get a bit frustrated whenever I see somebody in tech dismisses the EU as just trying to protect European companies from competition with their glorious and wonderful US companies.

It is, to put it bluntly, an ignorant thing to say.

The EU absolutely is for protecting and strengthening the European single market.

This is not a gotcha!

There’s a lot to dislike about the EU. They operate internally on some of the worst ideas to come out of post-war economics theory. They are all too willing to let individual member countries slide into fascism. And, as an institution, they are largely all too convinced that an all-seeing universal surveillance state would be a good thing, actually.

These are all good reasons to criticise the EU.

But the single market is what it’s for. Without it, the EU would cease to exist. To understand what motivates EU, as an organisation, you need to understand the single market.

Whenever I point out on social media that the single market is the purpose of the EU, I get bombarded by replies saying: “No you’re wrong. The EU was founded to preserve peace in Europe. Gotcha!”

What mechanism do you think they used to preserve that peace? Cozy feelings about elections for the EU parliament? Happy thoughts about student exchange programs?

The single market is the EU peace project, which makes protecting it an...