Pragmatic Legitimacy in Business Organisations: Why It Matters and How to Achieve It

“Why won’t the bastards do what I tell ’em?”

I’ve overheard this forlorn muttering from managers, executives and project managers on a number of occasions.

If you’re wondering why people in your organisation don’t do what they’re told, you could have a legitimacy problem. In the business world, legitimacy isn’t just a fancy term thrown around in board meetings—it’s the bedrock of how stakeholders perceive your organisation and, by extension, how they interact with it. One such form of legitimacy that’s gaining traction in discussions is “pragmatic legitimacy.”

What is Pragmatic Legitimacy?

Pragmatic legitimacy refers to the perception among stakeholders that an organisation’s actions are in line with its stated goals and, more importantly, that these actions will directly benefit them. In other words, if stakeholders—be they employees, customers, or investors—believe that the organisation is looking out for their interests and that there’s a mutual benefit in the offing, then the organisation is perceived as having a degreee of pragmatic legitimacy.

Benefits of Pragmatic Legitimacy

1. Enhanced Trust and Loyalty: When stakeholders believe that the organisation is working in their favour, they’re more likely to trust it. This trust translates to increased loyalty, be it from customers buying products or employees putting in extra effort.
2. Better Cooperation and Compliance: Stakeholders, particularly employees, are more inclined to follow organisational mandates and cooperate with leadership when they believe that the organisation’s objectives align with their personal or professional benefits.
3. Improved Organisational Resilience: A pragmatically legitimate organisation is better positioned to weather crises. In tough times, stakeholders are more likely to rally behind and support organisations they believe are serving their interests.
4. Increased Attractiveness to Potential Stakeholders: Whether you’re recruiting top talent or seeking investors, being seen as an organisation that offers mutual benefits enhances your attractiveness.

Achieving Pragmatic Legitimacy

1. Transparent Communication: Clearly communicate the organisation’s objectives and how they align with the interests of stakeholders. Let them know how they stand to benefit from the organisation’s success.
2. Consistent Actions: Ensure that organisational actions consistently reflect its objectives. Any deviation can erode the perception of pragmatic legitimacy.
3. Engage with Stakeholders: Regularly engage with different stakeholder groups to understand their concerns and feedback. This not only keeps you informed but also makes stakeholders feel valued and considered.
4. Demonstrate Mutual Benefits: Go beyond just stating the mutual benefits—demonstrate them. For instance, if an initiative is expected to increase profits, show how this could lead to better employee bonuses, reduced working hours, better tools, or enhanced shareholder returns.
5. Review and Adjust: Regularly assess your organisation’s perceived legitimacy. If there’s a gap between perception and reality, take steps to bridge it.
6. The Antimatter Principle: Adopting the Antimatter Principle as a core element of an organisation’s culture improves the pragmatic legitimacy of the organisation.

Summary

In conclusion, pragmatic legitimacy isn’t just another buzzword. It’s a vital component in building a strong, resilient, and successful organisation. By ensuring that all the Folks That Matter™ believe in the mutual benefits of your organisation’s actions, you pave the way for enhanced trust, cooperation, and overall success.