The mephistofactor in management

When ambition overshadows ethics

In Goethe's Faust the protagonist makes a pact with the devil Mephistopheles: the promise of unlimited knowledge and power — in return for his soul. The tale has stood as a powerful image on a deep human dilemma: sacrificing something fundamental to achieve quick and big gains. In a modern management context, we can call this The mephistofactor in management - where the pressure on efficiency and goal achievement challenges the leader's ethical compass, and in extreme consequence can lead to what Einarsen and Skogstad (2017) describe as tyrannical leadership - where the manager puts the results of the organization above the consideration of the dignity and welfare of employees.

This dynamic plays out daily in organizations all over the world - including in Norway. A serious and deeply disturbing example is the NAV scandal, in which improper practice of EEA regulations led to a number of innocent citizens being convicted, imposed repayment claims and, in several cases, imprisoned. Alerts and professional objections were overlooked in a system characterized by control liver and efficiency pressures. The goal of cleaning up social security benefits became more important than the legal certainty for individuals (Riksrevisjonen, 2020).

The NAV case is a clear example of the Mephisto factor in practice: the desire to appear effective and deliver results led to the downgrading of values such as justice, prudence and human dignity. What could have been detected and corrected early on was allowed to develop into a system failure with serious consequences.

Internationally, we find similar mechanisms in the Meta/Cambridge Analytica scandal, in which user data was exploited without consent, and in Amazon's handling of employees during the pandemic, where delivery precision became more important than working conditions. In all cases, we see how efficiency and power take precedence - and how human considerations and ethical reflex weaken in the process (Le Texier, 2019).

The Stanford Experiment

The Stanford Prison experiment (Zimbardo et al., 1973) has long been used as an illustration of how situations and roles can transform behavior. Students in authority roles quickly developed an exercise of power that compromised the dignity of others. However, the experiment was later criticized for methodological weaknesses and directed elements (Le Texier, 2019), but it still shows how structures and culture can allow—and in some cases reinforce unethical management.

The mephistofactor in practice

The mephistofactor often plays out as a series of small compromises:

• When budgetary objectives take precedence over considerations of the working environment or the rule of law

• When internal alerts are ignored to maintain “flow”

• When results are rewarded regardless of the methods that led to

The NAV case is a strong Norwegian example. Internationally, we have seen similar dynamics in Volkswagen's emissions cheating, Boeing's downprioritization of safety in the 737 MAX program, and the financial crisis - in which short-term gains were prioritized over accountability (Judge & Piccolo, 2004; De Hoogh et al., 2005).

Transformational leadership as a counterbalance

Transformational leadership provides an alternative to this destructive dynamic. The model is based on ideals of trust, development, and shared direction—and is associated with higher levels of ethical behavior and employee engagement (De Hoogh et al., 2005; Judge & Piccolo,2004).

Its core consists of four principles:

1. Idealized influence - The leader is an ethical role model
2. Inspirational motivation - Value-Based Vision and Hope
3. Intellectual stimulation - Reflection and critical questions are encouraged
4. Individualized consideration - Every employee is treated as a whole human

These principles counteract dehumanization, abuse of power and value shifting - and build resilience against the temptation to sacrifice ethics for efficiency.

Transformational leadership also has limits

At the same time, it must be recognized that transformational leadership also has its challenges. When charisma and visions are not balanced with critical dialogue and real complicity, blind loyalty and uncritical follow-through can develop (Tourish &Pinnington, 2002). Ethical leadership therefore requires more than inspiration - it requires structures that promote transparency, diversity and real accountability.

The way forward

Faust was warned, but made the pact nonetheless. In management, there is no devil - only systems, structures, and decisions that either strengthen or weaken our ethical compass. The NAV case reminds us of what happens when control and efficiency take precedence over humanity and reflection. The mephisto factor is real — and it can affect anyone, in both the public and private sectors.

Transformational leadership offers no immunity, but a direction: a way to reconcile goals and values, power and care, achievement and human dignity. In a time of high tempo and complex dilemmas, we need leaders who dare to stand in the tension between efficiency and ethics — and who choose the long-term and value-driven path, even when it costs more in the short term.

References

• De Hoogh, A. H. B., Den Hartog, D. N., Koopman, P. L., Thierry, H., Van den Berg, P. T., Van der Weide, J. G., & Wilderom, C. P. M. (2005). Motivi di lavoro, una chiasistica, e attitudi di lavoro in la sectà di profitto e voluntati. The Leadership Quarterly, 16(1), 17—38.
• Einarsen, S., & Skogstad, A. (2017). Destructive Leadership: When Leaders Break Down -- and What We Can Do About It. Oslo: Fagbokforlaget.
• Judge, T. A., & Piccolo, R. F. (2004). Transformational and transactional leadership: A meta-analytic test of their relative validity. Journal of Applied Psychology, 89(5), 755—768.
• Le Texier, T. (2019). Debunking the Stanford Prison Experiment. American Psychologist, 74(7), 823—839.
• The National Audit Office. (2020). Examination of social security exports and consequences of incorrect practice of EEA regulations. Document 3:4 (2019—2020).
• Tourish, D., & Pinnington, A. (2002). Transformational leadership, corporate cultism and the spirituality paradigm: An unholy trinity in the workplace? Human Relations, 55(2), 147—172.
• Zimbardo, P. G., Haney, C., Banks, W. C., & Jaffe, D. (1973). The Stanford Prison Experiment: A simulation study of the psychology of imprisonment. Naval Research Reviews, 9, 1—17.