Is “transgenerational response” a hidden cause of failed corporate turnarounds and chronic underperformance?

Abstract

When organizations that have survived traumatic reversals – for example, product failures, ethical scandals or market disruption – attempt turnarounds, they usually seek a fresh start, adopting a new strategy and installing new leadership. But if this new initiative doesn’t work and the firms continue to suffer from chronic under performance, the cause could be “transgenerational response,” a potentially crippling long-term condition stemming from the trauma that occurred in the past (see the cases of AIG and Yahoo). Transgenerational response syndrome is well known in medical and biological research. The term describes a severe environmental condition that creates a negative adaptive response in an organism. The response is transmitted to future generations and adversely influences their development and health. Healthcare research has identified, for example, adverse transgenerational effects of inadequate maternal nutrition, which harms the development and health of future generations. Even traumatic experiences can cause both physical and psychological consequences for several generations of descendants of survivors. One of the most illuminating studies into transgenerational response was an examination of the effects of post-traumatic stress disorder (PTSD) in babies of mothers exposed during pregnancy to the World Trade Center attack in 2001.[1] The study concluded that the effects of maternal PTSD, as a result of this catastrophic event, were passed on to their babies. The evidence: their significantly smaller than average birth weight and a permanent vulnerability to depression, stress related illnesses and an increased distress response to disturbing events.