Home » Congrès des 10 ans de l’AFD&M » Teaching and Researching in a Changing Environment. A Law and Management Approach

Teaching and Researching in a Changing Environment. A Law and Management Approach

Keynote Address to the French Academy of Legal Studies in Paris

By David Orozco, Bank of America Professor of Business Administration at Florida State University’s College of Business

December 14, 2023

Bonjour. C’est un vrai plaisir assistir aujourd’hui avec vous dans un conference celebratoire tres importante. Le dizieme anniversaire de la Association Francaise Droit et Management.

Thank you everybody. My high school French is only comme ci comme ca, so I will deliver the keynote address today in English.

Today I will share some insights on what I believe is the relevance and unique power of Law and Management, particularly in refence to research and teaching during these turbulent times. And what I believe are some important opportunities that lay ahead to strengthen our association as we navigate these uncertain waters. But, before speaking about the Law and Management Approach, let’s create a common vocabulary.

First, what is management? Going to the U.S. Academy of Management website did not provide a simple answer since there are 26 divisions or interest groups within this large organization: e.g. spirituality in management, management history, technology and innovation management.

I found a more useful starting point in one of the greatest management thinkers and writers: PETER F. DRUCKER, described as the founder of modern management and an advisor to various heads of America’s largest corporations.  

In his 1974 classic book titled MANAGEMENT – Tasks, Responsibilities, Practices, Drucker writes:

“There are three tasks, equally important but essentially different, which management has to perform to enable the institution in its charge to function and to make its contribution:  • the specific purpose and mission of the institution (profitability)  • making work productive and the worker achieving; • managing social impacts and social responsibilities.”

He continues and says…

“These three tasks always have to be done at the same time and within the same managerial action. It cannot even be said that one task predominates or requires greater skill or competence. True, business performance comes first—it is the aim of the enterprise and the reason for its existence. But if work and worker are mismanaged there will be no business performance, no matter how good the chief executive may be in managing the business. Economic performance achieved by mismanaging work and workers is illusory and actually destructive of capital even in the fairly short run. Such performance will raise costs to the point where the enterprise ceases to be competitive; it will, by creating class hatred and class warfare, make it impossible in the end for the enterprise to operate at all. And, mismanaging social impacts eventually will destroy society’s support for the enterprise and with it the enterprise as well.”

What does the law have to do with Drucker’s three pillars of managerial functions? A lot!

With respect to profitability, I would say this is the primary emphasis of what management scholars and practitioners call strategy. I will return to this topic later since I have spent several years of my academic career thinking, writing, teaching, and practicing with respect to law and strategy.

With respect to managing people and making employees productive let’s look at the changing environment created by several recent phenomena. One is artificial intelligence (AI). How is AI impacting the workplace and what is the law doing in this regard? Hollywood writers, e.g. went on strike to protect their creative output and interests. In another context, healthcare organizations in the U.S. are at an alarming rate being acquired by profit-oriented investors (private equity) and doctors now seek to unionize to protect patient and physician welfare in ways that were never seen before.

With respect to social obligations, the law also has a great deal to say. Although the law is often simply the starting point of social ethical obligations, that is, necessary but not sufficient. Following the letter of the law and stopping there leads to a compliance approach that meets a minimum standard but does not achieve the full ethical perspective. Some prominent university presidents recently realized this when they testified before Congress and robotically recited legally sufficient, but morally insufficient testimony with respect to statements on campus related to genocide. An article I wrote recently that is forthcoming in the American Business Law Journal examines what I call innovation stakeholders and the ethical obligations that firms have toward these groups to promote the interests of society and the firm. Innovation, as I argue in the article, is promoted when stakeholder interests are broadly promoted with respect to innovation and intellectual property.  

Strategy is largely based on the managerial actions taken to achieve competitive advantage under competition. This is often defined in terms of profitability, Drucker’s first fundamental managerial task. Over the years, I have focused a great deal of my own energy and time on the question of law and strategy. I’ll now shift gears to speak a bit about what law and strategy means to me and how my experiences with this dynamic and rich field might contribute to law and management.

The origins of my exposure to law and strategy was noted with a contrast between two models of managerial behavior. The contrast was between those managers who used the law to create opportunities and value versus those who did not. Much academic research at the time reflected this disconnect and took the law for granted, or viewed the law as an exogenous variable, that is, something that can be viewed as a constant and not subject to any variability or management. The law was thus assumed to be the same for everyone. But as I studied cases of law and strategy I realized this was pure fallacy. The law is not exogenous, in fact it is the opposite: it is endogenous. Some legally astute managers to use the terminology of my colleague Constance Bagley, shaped and managed the law to achieve an element of strategy and competitive advantage. After law school at Northwestern University, I spent three years at the Kellogg School of Management completing a post-graduate fellowship to analyze law and strategy within the field of intellectual capital management, examining the strategic use of intellectual property rights. Since then, I have collaborated with other great scholars such as Robert Bird from the University of Connecticut and together we wrote a pioneering article in the MIT Sloan Management Review called “Finding the Right Corporate Legal Strategy.”  Since then, I coauthored a textbook with McGraw-Hill appropriately called “Law and Strategy” that will soon enter its 3rd edition. We may even explore the possibility of developing an international edition if there is sufficient interest.  

I’d like to share some key insights I gained from my expedition into the world of law and strategy that might be relevant to you in your research and teaching journeys:

  1. Nothing is self-contained. As Drucker pointed out, management has three essential tasks that all must be successfully implemented, or else the organization will fail. Today, so much is attempted to be narrowly defined in a way that excludes or limits. We live in an era of micro-specialization. Our job is to break down the conceptual barriers, or as Steve Jobs said “connect the dots” by looking backwards.  
  2. Realize that law and management is largely about behavior. Executives are implementing these approaches and making life more interesting and challenging through their actions. They are the human laboratory that provides so much interesting material for our articles and classroom anecdotes and lectures.
  3. Ethics, fairness, and good faith as guiding principles are always essential although not always easily apparent in our research and teaching. As Drucker pointed out in his book, when managers view management as an end rather than the means to achieving the goals of management (the three pillars mentioned before: profitability, a productive work environment, and social responsibility), the result is bureaucracy. The same can be said when the law and formalism is viewed as an end. Injustice, corruption, stagnation, may then be the results.  

Lastly, as we prepare to listen to and learn from the various excellent presentations today and tomorrow within the conference’s general theme of disruption and how the law will relate to change, let’s propose a course of action for the broader field of inquiry.

To conclude, I propose we develop a call to action to strengthen our wonderful field of Law and Management. You have much to be proud of and celebrate in these first ten years of the French Academy’s existence. But perhaps it is time to looks forward to the next 10 years. My humble proposal is that we should all do what we can to strengthen the Foundations of the Law and Management movement as a growing global movement and in the process support one another, build together, cooperate, and assist each other. Here are some concrete steps that we can all take:

  1. Cite each other. If you know someone is working on a topic related to your work, let the other party know and send your work for possible citation. If you are the party receiving this notice and request, be open to the citation possibility.  
  2. Let’s build on a strong foundation and cite the important works in our field. Every academic field has a foundational body of scholarship and we have started to develop that in Law and Management. For the best list of Law and Management works see this website: https://lawandmanagement.com/key-articles/ I urge you to actively read and cite these works and contact the authors to let them know of your work and how it can potentially advance their own work.
  3. The need to coauthor. Find others in the Law and Management network to generate new ideas. The best ideas are obtained from diverse sources. My most cited articles are the ones I coauthored, and I need to do this more often. 
  4. Recommend each other for advancement. If you know if a job opportunity do not hesitate to reach out to someone in our association you think would be qualified and let them know. This can include academic and professional opportunities.
  5. Provide references and help others advance professionally. Since becoming a full professor, the highest academic rank in the U.S. a few years ago, I have written various external promotion letters. Let’s bring each other up.
  6. Finally, let’s bring others into the group and grow. When doing this we need to be inclusive and open to various approaches: theoretical, pedagogical, practice-oriented, etc. That also means we need to reach out across the globe to colleagues in other countries and continents to make the Law and Management movement a truly global movement with global reach and power.

I thank you all for your kind attention and look forward to spending more time with you during the conference!