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Business schools teach optimization. They teach market analysis, financial modeling, supply chain efficiency, and strategic planning. They train students to break problems into manageable pieces, to quantify everything that can be quantified, and to make decisions based on measurable outcomes. This approach has built empires and created enormous wealth. It has also, increasingly, created enormous problems.
Enter Alfred North Whitehead, a mathematician and philosopher who in 1925 published Science and the Modern World, a book that seems to have nothing to do with business. No balance sheets. No case studies. No frameworks with memorable acronyms. Yet this book addresses the foundational mistake that haunts modern business thinking, a mistake so deep that most MBA programs don’t even recognize it as a mistake.
The mistake is this: we have confused useful abstractions with actual reality. And in that confusion, we have built business practices that optimize parts while destroying wholes.
The Fallacy of Misplaced Concreteness
Whitehead gives this mistake a name: the fallacy of misplaced concreteness. It happens when we treat our mental simplifications as if they were the full truth of what exists. In business, we do this constantly. We treat “the market” as a real thing that has preferences and makes decisions. We treat “the consumer” as a rational actor with clear preferences. We treat “shareholder value” as the singular reality that a company exists to serve.
Every MBA student learns to analyze businesses by breaking them into functions: marketing, operations, finance, human resources. This is practical. This is necessary. But Whitehead reminds us that when we break something into pieces, we lose something essential in the breaking. A company is not actually the sum of its departments. A market is not actually the sum of individual transactions. A person is not actually the sum of their role as consumer, employee, and shareholder.
The world is not made of separate things that occasionally interact. It is made of relationships, processes, and events that we artificially separate in order to think about them. Business education teaches the separation. It rarely teaches students to put things back together.
Why This Matters Now More Than Ever
When Whitehead wrote, industrial capitalism was already facing critiques, but the stakes were different. Today, climate change, mass extinction, rising inequality, mental health crises, democratic backsliding, these are not separate problems. They are interconnected failures of systems that were optimized for narrow goals.
Business schools are training the people who will lead the institutions most responsible for addressing these challenges. Yet the fundamental mode of thinking taught in MBA programs is precisely the mode of thinking that created them. We teach students to maximize efficiency without asking efficient at what cost? We teach them to capture value without asking what value means beyond price.
Whitehead offers an alternative. Not a rejection of analysis, measurement, or rationality, but a more sophisticated understanding of what those tools can and cannot do. He shows that the mechanical worldview is a useful approximation but a terrible philosophy. It works for building bridges. It fails for understanding life, consciousness, value, and meaning.
Business is not bridge-building. It involves all those messy, non-mechanical things: human motivation, social trust, cultural meaning, ecological limits, ethical obligations. An MBA program that trains students only in mechanical thinking is training them for a world that does not exist.
The Process View: Everything Is Becoming
Whitehead’s central insight is that reality is not made of things; it is made of processes. Nothing simply exists in a static state. Everything is in the process of becoming. A river is not a thing that happens to flow; the flowing is what makes it a river. A company is not a thing that happens to do business; the doing is what makes it a company.
This sounds abstract, but the implications are immediate. The companies that thrive over decades are not the ones that define themselves most narrowly, they are the ones that understand themselves as patterns of activity that must continuously evolve.
IBM was a hardware company until it wasn’t. Netflix was a DVD company until it wasn’t. These transformations are not betrayals of identity; they are expressions of understanding business as process. The companies that die are often the ones that cling most tightly to “what we are” rather than adapting to what they are becoming.
Business schools teach strategy as if it were primarily about positioning—finding your place in a stable structure. Whitehead suggests strategy should be understood as participation in ongoing processes of change. You are not standing outside the system trying to find the optimal position. You are part of the system, and your actions change the system even as the system changes you.
This applies to markets, which are not static structures but evolving patterns of relationship. It applies to innovation, which is not the insertion of new things into an unchanging context but the reorganization of relationships that creates new possibilities.
The Danger of Abstractions
Here is where business education most needs Whitehead: in understanding the proper use and limitation of abstractions. An MBA program is largely a training in abstractions. Financial statements abstract from the messy reality of business activity to create clean numbers. Market research abstracts from the full complexity of human beings to create consumer profiles. Strategy frameworks abstract from the chaos of competition to create clear choices.
All of this is necessary. You cannot think about complex realities without abstraction. But Whitehead insists that we must always remember that our abstractions leave something out.
Financial statements leave out ecological damage, worker burnout, and cultural erosion. If your decision is about quarterly resource allocation, perhaps those omissions are acceptable. If your decision is about long-term strategy, those omissions may be disastrous. Business schools train students to be fluent in abstractions but rarely train them to be wise about what their abstractions are hiding.
Consider “human resources,” a phrase that perfectly captures misplaced concreteness. People are not actually resources in the same sense that coal or capital are resources. Treating them as such in your analysis may be useful for certain calculations, but if you forget that this is an abstraction—you start to believe that people simply are resources. You will be surprised when morale collapses, when your best people leave, when culture deteriorates.
The actual human being is a center of experience, meaning-making, relationship, and value that cannot be captured in your HR analytics.
Interconnection
One of Whitehead’s key insights is that the properties of a whole are not simply the sum of the properties of its parts. New qualities emerge from organization and relationship. Water is not just hydrogen and oxygen; it has properties that emerge from how those elements are organized. Consciousness is not just neurons; it emerges from their organization.
Business schools understand this intellectually—they use terms like “organizational culture” and “ecosystem dynamics”—but the analytical tools they provide work almost entirely at the level of parts. They teach students to understand strategy by analyzing competitive forces, to understand organizations by examining incentive structures, to understand markets by modeling individual behavior.
These approaches are not wrong, but they are incomplete. They struggle to explain why some organizations have extraordinary cultures that cannot be reduced to their policies. They struggle to address problems that exist at the level of whole systems.
Whitehead trains readers to think at multiple levels simultaneously—to analyze parts while remaining aware of wholes, to optimize locally while monitoring for effects globally. This is difficult thinking. It cannot be reduced to a framework. It requires judgment, imagination, and a tolerance for ambiguity. These are precisely the capacities that business education often fails to develop, and that the business leaders of the future will most desperately need.
Value Beyond Price
Perhaps Whitehead’s most radical challenge to business thinking is his insistence that value is irreducible to any single measure. In business school, almost everything gets translated into money. This is practical and often necessary. But it is also a catastrophic oversimplification.
Whitehead argues that the universe is fundamentally about the creation and enjoyment of value—beauty, meaning, complexity, intensity of experience. These are not subjective projections onto a valueless mechanical universe. They are fundamental features of reality. A sunset is actually beautiful, not merely perceived as beautiful by nervous systems that evolved to find certain stimuli rewarding.
Companies create value in multiple dimensions: economic value yes, but also meaningful work, useful products, beautiful designs, strong communities, scientific knowledge, cultural meaning. When business education trains students to optimize only for the dimension of value that shows up in financial statements, it trains them to destroy the other dimensions in pursuit of the one.
The companies we most admire rarely became admirable by optimizing solely for financial metrics. They optimized for excellence for solving meaningful problems, for building organizations where people could do their best work. The financial success followed from that richer understanding of value, not the other way around.
The world that today’s MBA students will lead is not the world of the 20th century. The assumption of unlimited resources is dead. The assumption of stable systems is dying. The assumption that optimizing parts will optimize wholes can be dangerous. The assumption that financial value captures all value worth considering is creating civilizational crises.
Reading Whitehead will not teach anyone how to build a financial model or analyze a supply chain. But it will teach them to recognize when their models are hiding essential features of reality. It will teach them to think in terms of processes and relationships. It will teach them that abstractions are tools, not truths. It will teach them that value is multiple and irreducible. It will teach them intellectual humility about the limits of mechanical thinking when applied to living systems.
Science and the Modern World should be required reading for MBAs not because it teaches business skills but because it teaches the habits of thought that make business skills even more useful. It will not make students immediately better at next quarter’s earnings. It will make them capable of asking whether next quarter’s earnings is really the question that matters.
And increasingly, asking that question well is the difference between leadership and management, between building the future and mortgaging it.
