Academic Publications

This section highlights some of Isaac Mostovicz’s academic work, including journal articles and work stemming from his PhD, “The Structure of Interpretation and its Role in Knowledge Creation”.

The Diamond Industry, Again

Isaac Mostovicz writes...

It was a pleasant surprise to read a new article about the diamond industry, “Applicability of the high-performance organization framework in the diamond industry value chain” just to find out that the authors extensively used my article, “The diamond industry as a virtual organization: past success and challenging future” when describing the diamond industry. I am really fond of that article which was written by mistake. During my studies at the University of Northampton Business School one of the professors who did not grasp what I am researching insisted that I will write an article about the diamond industry. I had no choice but to do this work, which I considered unnecessary.  Upon reading the work my mentor, Professor Nada Kakabadse told me that I have a good basis for an academic article introducing me to the academic publication industry. Well, my work was only the first part of the article and I was asked to add conclusions. These conclusions became longer than the article itself, appeared in a separate article and actually served as the basis for my PhD. Life are full of surprises, don’t you think?

Eight years passed by since I first authored that article about the diamond industry. The industry suffered from severe problems of cash-flow and inability of the banks to finance it any longer. For example, Russell Shor reports in recent GIA article that

“Last year, ABN Amro, the industry’s leading lender, announced it would limit credit to 70% of rough purchases, a break from past policy when they would finance the full amount. In short, diamond manufacturers and rough dealers must put 30% of their own capital up for each purchase, a move the bank feels will limit the speculative buying that has created an extremely volatile rough market during the past four years. In addition, the manufacturers must invest their own funds into rough that is much less profitable to cut in the current environment.”

This policy is similar to that the industry’s lending bank adopted past the economic meltdown back in 2008 when they limited the credit to 60% only causing the wheels of the industry to completely stop for three months.

However, within the same article Russell Shor paints another picture:

 “After reasonably successful holiday sales of diamond jewelry in the U.S., De Beers allocated a large sight of about $750 million, with prices of medium quality goods rising 3-5%, higher in some cases. The price increases were apparently based on the assumption that demand for certain goods will increase in the spring when U.S. retailers will need to restock.

As soon as the news of the price increase reached the markets, premiums on existing rough supplies also began to rise, causing concern that a new round of speculative buying – and subsequent price increases unrelated to demand – may be in the offing.”

A large sight, a raise in rough prices and increased premium on goods? Doesn’t all this tell you that business is booming? So, what exactly happens here? Isn’t the industry living in La La Land?  Successful holiday sales? Did you see the long lines of customers standing outside the shops trying to snap diamond jewellery off the shelf? Did I miss something?

The past eight years taught me invaluable lessons. Nowadays I know much more about the diamond industry, about its strengths and weaknesses about the mistakes, the wrong assumptions and misconceptions that shaped and continue to shape the industry. After delivering a series of three lectures that only cover the history of diamond marketing in the last eighty –five years I don’t think that another academic article is the right way for expressing my thoughts and broadcasting them. Are you interested in what I have to tell? What would be the most suitable medium to use and why?

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Can Materialism Help Coping with Stress?

Isaac Mostovicz writes...

Recently, a research by Frof. Eli Somer of the University of Haifa and Dr. Ayalla Ruvio of Temple University in Philadelphia PA. argued that the more materialistic people are, the more they will go on a shopping spree when exposed to trauma. I was intrigued by the claiming that materialism can predict how people cope with stress, asking what materialism is and how it is defined just to find out that we all are materialistic. We all acquire and own material goods, or goods that have some monetary worth to achieve life goals and desire states. Put it simply we all spend money unnecessarily not only for satisfying our basic needs but for achieving higher goals. Sounds familiar? Isn’t this an example of luxury behaviour when we overspend needlessly?

money-shopping-431x300Somer and Ruvio conducted their research in Sderot, a southern Israeli town which was exposed to non-stop rocket and missile fire from Gaza terrorists for over eight years. I had an opportunity to host children from Sderot and witness how much those children suffered from this long-term exposure to stress. To alleviate this taxing stress people went on shopping spree time and again. While the less materialistic people coped with the continuous exposure to danger by seeking social support the more materialistic ones were more oriented toward objects than humans.

Did this materialistic consumption help people to cope with their stress? The authors posit that “The results of this study also suggest that the pleasures of shopping cannot attenuate posttraumatic distress, and that maladaptive shopping behaviours increase with the level of traumatic exposure.”

Do you agree with these results? In my opinion, the researchers stopped too early and didn’t ask the “how” and “why” questions. Materialism is part of our life and people need it and use it to satisfy their needs, especially that of enhancing their self-esteem. With continuous exposure to danger it is a never-ending fight and people need to remind themselves of the importance of their self. Some seek professional support and some turn to purchasing objects. However, the purchasing activity, per-se won’t help in extreme situation such as non-stop terroristic aggression over many years. What might subconsciously help in mild situation won’t help in these extreme cases without understanding consciously why we overspend needlessly and how this overspending can help us coping with stress.

I don’t think that materialistic behaviour is counterproductive as the researchers argue. I do agree that the behaviour by itself might even increase the post-traumatic stress symptoms if people do not deeply understand the “why” and “how” of luxury. And from materialistic point of view it is possible that it would be cheaper to let people go on conscious and deeply understood buying spree than sending them to therapy. What do you think?

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Core values for CSR

Isaac Mostovicz writes...

The excerpt below is from a paper of mine which will be published in the Special Issue of the Corporate Governance Journal and presented at the 2011 colloquium of EABIS, the Academy of Business in Society. I have co-authored the paper with Andrew Kakabadse and Nada Kakabadse.

The paper will be published on September 5th and looks at the core values which must underpin CSR programmes if they are to be effective.

On April 20th, 2010 an explosion on the Gulf of Mexico Deepwater Horizon oil rig exposed the United States to an historic ecological disaster.

This episode illustrates the limits of CSR programmes currently undertaken by global businesses. The logical rules and regulations which business and government leaders created did not work to exemplify the broadly shared social values that US society deemed to be important.  Representing our deeply held values and the metaphorical expressions of our beliefs, these accountability structures must change over time to continue to align with prevailing beliefs and core values. This global CSR failure also reflects the dynamic process which CSR programmes must undergo over time.

Emerging markets can also learn a valuable lesson from this case study as they continue on their path of economic development. Their CSR programmes should also reflect their own cultures’ unique social norms and be dynamic enough to respond to unprecedented threats due to increased stakeholder scrutiny and constraints on environmental and other resources.

Exploring this case study provides important theoretical lessons for companies in emerging markets and elsewhere to consider.  For instance, can increased regulation prevent corrupt or unaccountable corporate practices? Are voluntary systems of accountability fundamentally flawed and fuelled only by corporate disdain for regulation? And to what extent should markets be allowed to dictate the course of play vis-à-vis the more arm’s length yet expensive bureaucracy created by government regulation?

Corporate responsibility cannot be practiced if various personal attributes do not exist in the individuals within the company.  These consist of the four pillars of leadership, ethics, personal responsibility and trust, all of which are dynamic in nature. Incorporating these personal qualities can help improve the planning and practice of CSR programmes as well.

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Leadership Theory for Police

Isaac Mostovicz writes that policemen are interested in leadership...

Recently I learned that a leadership article that I wrote with Andrew and Nada Kakabadse, A dynamic theory of leadership development, has been recommended for British police officers by the National Police Library. (It’s on page 20 of their newsletter here or here.) It’s always nice to discover that an audience you didn’t expect appreciates your work.

Trisha says of this article...

Cool! That’s a celevr way of looking at it!

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Take Our Leadership Survey

Isaac Mostovicz writes...

I’ve been working on a questionnaire, along with Andrew and Nada Kakabadse, about leadership. We’ve reached the stage where we would like feedback before proceeding. I’d be grateful if you could take our survey — it should only take 10 – 15 minutes of your time — and hope you find it interesting.

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In Pursuit of Ethical Leadership

Isaac Mostovicz writes that ethical leadership requires a commitment to engaging with others while remaining true to your own beliefs...

Leadership is a developmental process, based on the type of worldview which a leader holds.  But what is truly ethical leadership and can it be applied in practice?

As previous blog entries have discussed, people tend to make choices – and leadership decisions – either as a Theta or a Lambda.  Thetas seek affiliation and order whereas Lambdas seek achievement and challenges.

Many people, from philosophers to business strategists, have attempted to understand the fundamental nature of leadership.  Some, such as the 19th-century Scottish thinker Thomas Carlyle, argued that ‘great men’ or leaders are born, and that they hold naturally the essential skills which end up being mimicked by others.

Others, such as those from the developmental school of thought, believe that leadership skills are accumulated over time based on one’s experience and how one anticipates or sets expectations for the future.  In this sense, the leader is not born but rather ‘developed’ over time.

In my academic writing, I have argued that leaders tend to plan organisational activities and strategies based on their respective worldview (Theta or Lambda).  For instance, a Lambda leader who seeks challenge and creation may not naturally be able to provide the feedback and support that a Theta employee may need.  Conversely, a Theta leader who seeks unity and certainty may stifle the creative contributions and drive for personal achievement that Lambda employees offer.

As a result, ethical leaders must constantly strive to respect the worldviews of others within the organisation while remaining true to their own way of seeing the world.  This dynamic process suggests that truly ethical leadership is impossible to achieve in practice.  Rather, it can only be pursued as an ideal based on constant engagement with colleagues and other stakeholders.

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The diamond industry as a virtual organisation

Isaac Mostovicz writes that De Beers' past market dominance in the diamond industry must be replaced with a new form of management ...

Having previously dominated diamond supply and exercised near total control over diamond distribution, the diamond industry market leader De Beers now accounts for just 40% of global diamond production and 45% of distribution. In the face of competitive and regulatory pressures, De Beers has recently sought to adapt its role from being the custodian of the industry to acting merely as a major player. However, its retreat from a position of industry dominance is creating tensions within De Beers and among industry participants.

This paper seeks to explain De Beers’ behaviour and the reaction of the industry in terms of paradox management and identifies the requirement for a new form of leadership to replace the previous monopoly situation and guide the diamond industry into a better future.

Mostovicz, I., Kakabadse, N. and Kakabadse, A. (2007), ‘The diamond industry as a virtual organisation: Past success and challenging future’ Strategic Changes, December 16(8), 371-384.

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Janusian mapping: A mechanism of interpretation

Isaac Mostovicz writes that paradox is an integral part of how we view the world...

In this paper it is argued that human interpretation is an inherently paradoxical and complex mechanism.

Human interpretation is underpinned by values, preferences and contrasts, and assumptions, and surfaced through an idiosyncratic combination of personal choice and logic (Pinker, The blank slate: the modern denial of human nature, 2003). In order to find ways through interpretive diversity, Janusian thinking is a conscious and purposeful mechanism (Rothenberg, Creat Res J 9(2–3):207–231, 1996) that allows each one to think paradoxically.

Coping with paradoxes is not only a cognitive challenge in trying to resolve the irresolvable but also an emotional one, as emotion might distort the paradox. Janusian attitudinal mapping allows individuals to face the true paradox and to review the assumptions behind it. Such review may modify or even abolish certain assumptions altogether.

However, Janusian attitudinal mapping is an emotional undertaking that should follow the three elements involving social reform for advancing and fostering knowledge: shock, open communication and experimentation, and paradox leadership (Lewis, Acad Manage Rev 25(4):760–786, 2000).

Mostovicz, I., Kakabadse, N. and Kakabadse, A. (2008), ‘Janusian mapping: A mechanism of interpretation’, Systematic Practice and Action Research, published online., March 4th, 2008, DOI 10,1107/s11213-008-9092-x.

Keshavaya says of this article...

A SUPPORTED BY THE DEVELOPER TOOLS? It was interesting. You seem very knowledgeable in ypour field.

Mike says of this article...

WoW amazing post dude, thanks for the info!

Preston Racette says of this article...

Great post! Very useful! Keep up the good work!

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