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Groupthink, obedience, dishonesty: the psychology of the Post Office scandal

(by Adam McCulloch, Personnel Today 12 Jan 2024)

The Post Office scandal, the subject of a public inquiry since 2021, saw more than 900 sub-postmasters  prosecuted for theft and false accounting. But it is now established that the Horizon computer system that provided prosecutors and auditors with their evidence, was seriously flawed. Senior management at the Post Office and the system’s creator, Fujitsu, failed to acknowledge these flaws. Here, Personnel Today takes soundings from two leading professionals in the HR sphere on what messages must be taken onboard by leaders and organisations as the questions grow ever louder. In particular we look at the psychological issues that may have come into play over the 25-year-old saga.

Compliance, obedience, groupthink and dishonesty are all key aspects of the scandal for business psychologist Sarah-Jane Last, founder of The Work Psychologists. She says the scandal offers “a fascinating case study when viewed through the prism of key psychological theories” showing how “psychological phenomena can manifest in real-world organisational crises, leading to devastating consequences.”

Post Office scandal

HR leaders would do well to heed the lessons from the scandal, adds Last, which offers a vivid illustration of “psychological dynamics such as obedience to authority, conformity to group norms, groupthink, can lead to catastrophic outcomes”.

She cites studies by Stanley Milgram on obedience and Solomon Asch on conformity as being useful in understanding some of the Post Office’s actions.

Hierarchical pressure

With reference to Milgram, “individuals may have perpetuated the wrongful prosecutions, despite potential personal misgivings, due to the hierarchical pressure and the authoritative weight behind the decisions.”

And despite evidence of discrepancies and faults in the system, “the collective adherence to the narrative that the system was infallible mirrors Asch’s experiment, where individuals agreed with obviously incorrect group opinions”. In the Post Office, this could manifest as employees and managers not voicing concerns or challenging the system; instead conforming to the established organisational belief in the system’s reliability.

This is witnessed by Post Office employees’ defensive stance on Horizon. For example, after the wrongful conviction of sub-postmaster Seema Misra, Post Office head of criminal law Jarnail Singh wrote a celebratory email to colleagues, claiming this result would stop others from “jumping on the Horizon-bashing bandwagon”.

HR can play a crucial role in fostering a culture of ethical leadership and decision-making, thus safeguarding the organisation against the pitfalls seen in the Post Office scandal” – Sarah-Jane Last, The Work Psychologists.

In terms of the sub-postmasters themselves, Last says, their sense of shame could well have prevented many from taking effective action against the Post Office. This would explain why so many are only bringing forward their cases now.

She tells Personnel Today: “This experience of shame can be profoundly isolating, eroding an individual’s self-esteem and sense of agency, making it challenging to fight back against the accusations. The fear of being socially ostracised, along with the daunting prospect of challenging a powerful organisation, likely contributed to a sense of helplessness and resignation among the sub-postmasters. This “created an environment where resistance to the flawed system was significantly hindered”. Fortunately, in the case of Alan Bates and others who chose to fight for years, this feeling of shame did not affect everyone.

Negative psychology

Last says she fears that the inquiry into the scandal may reveal examples of “dark leadership traits”. These can include narcissism, Machiavellianism and psychopathy. “Such traits in leadership,” she writes “could lead to a disregard for the wellbeing of sub-postmasters, manipulative strategies to maintain a certain narrative, and a lack of remorse or responsibility, echoing the downfall of other organisations led by individuals with similar traits.”

Machiavellianism can be seen in the withholding of information, legal threats and attempts to mislead judges. Psychopathy is revealed in the lack of remorse and empathy over the terrible outcomes suffered by accused sub-postmasters. Narcissism can be seen in attempts to preserve an individual’s self-image or the image of the institution, which takes precedence over the truth or welfare of others.

Without enhanced screening of leaders at the candidate stage, says Last, many organisations could be at risk of inviting such traits into top positions. The cultivation of a “speak-up culture” also mitigates against such negative psychological factors becoming prevalent, as does the use of metrics that elevate ethics, culture and engagement to be at least as important as finance.

If the employee’s version of events offers a reasonable alternative explanation for what happened, this should be fully explored” – Kate Palmer, Peninsula.

Last adds: “HR can play a crucial role in fostering a culture of ethical leadership and decision-making, thus safeguarding the organisation against the pitfalls seen in the Post Office scandal. The goal is to create an environment where ethical behaviour is the norm, and leaders are equipped and motivated to uphold these standards.”

An HR approach to investigations

Had the Post Office employed its sub-postmasters, rather than engaged them in a franchising contract, then perhaps the approach from an HR department with employees would have been very different. For Kate Palmer, employment services director at HR consultancy Peninsula the scandal is “an essential step-by-step guide to employers on what not to do when carrying out an internal investigation”.

She adds: “An HR investigation doesn’t automatically mean that an employee has done what is being alleged,” a point that may seem obvious, but was not understood by the Post Office. “If the employee’s version of events offers a reasonable alternative explanation for what happened, this should be fully explored, even if it would appear to contradict any long-established understanding that you have of your processes.”

Workplace investigations

This did not happen in many of the Post Office cases where the underlying assumption of Post Office auditors and executives was that the Horizon system was working correctly, a “truth” that had to be defended at all costs whatever the long-term consequences – even if it was known that flaws existed.

Palmers says there was a “huge lack of transparency” from the Post Office throughout the investigation with sub-postmasters left in the dark or lied to about why the money was missing from their accounts.

A failure to maintain an open, ethical culture and to conduct investigations properly, is shortsighted not only for an organisation but ultimately for an executive’s career.

Inquiry summons

Both Paula Vennells, chief executive of the Post Office 2012-19, and Angela van den Bogerd, who had been people and change director among many other roles, have had to leave subsequent jobs because of their roles in the scandal. Vennells had briefly been chair of Imperial College Healthcare NHS Trust and van den Bogerd, people director at the Football Association of Wales. But these two executives are far from being the only senior executives whose careers will forever be tarnished.

Over the next few days, the public inquiry will summon witnesses from among Post Office lawyers and Fujitsu employees. Meanwhile, MPs from the business and trade committee will quiz Nick Read, current chief executive of the Post Office, and Paul Patterson, chief executive for Europe at Fujitsu.

Kevin Hollinrake, the government minister responsible for the Post Office, will also appear, as will Alan Bates the former sub-postmaster and the prime focus of the ITV drama.

With so many more details still to emerge from the 25-year-old scandal – one of the UK’s greatest-ever miscarriages of justice – detailed conclusions cannot as yet be sculpted. However, any organisation that does not heed the central messages around ethics, transparency, open culture and proper assessments of leaders, should be concerned about the outcome.




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