By MARY WILLIAMS WALSH
Published on Wednesday, October 18, 2000
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Handing off a family business to the younger generation is always fraught with risk, but the Manhattan psychiatrist and business consultant Kerry J. Sulkowicz did not appreciate how much so until the day a client — an executive who wanted to pass on his stake to his son — said he was thinking of building a cinder-block wall in the executive suite to seal off his younger brother.

''I thought at first he was joking, but he said no, this was something he had considered,'' said Dr. Sulkowicz, one of a small but growing number of psychoanalysts who apply the theories of Freud, Jung and their brethren to dysfunctional workplaces.

Human psychiatric patients may consider this the age of psychopharmacology, thanks to the spread of Prozac and the realpolitik of managed care. But for sick companies, there are not any selective serotonin reuptake inhibitors yet, and the long-running economic expansion means there is more money than usual for consultants. So, unexpectedly, proponents of the old-fashioned ''talking cure'' are finding new beachheads in the frenetic worlds of commerce and industry.

''It's very popular,'' said Kenneth M. Settel, a clinical instructor in psychiatry at Harvard Medical School, who founded the American Psychoanalytic Association's ad hoc committee on corporate and organizational consultation four years ago.

''The more enlightened companies are concerned about morale,'' Dr. Settel said. ''If it's an abusive workplace, money will keep people for a while, but eventually they'll be drawn away.''

Psychoanalysts say the everyday ordeals of the business world are capable of setting into motion what they call collective insanity or the psychosis of association: mergers gone awry, incompetents named to top positions, sibling rivalries in the boardroom, mass layoffs, executive indictments.

Dr. Sulkowicz suspects the technological advances driving the new economy are also spawning workplace neuroses. The newfound ability to buy seemingly anything at the click of a mouse, the promise of sudden riches through day trading and the hype about dot-com millionaires have probably fanned unhealthy delusions of omnipotence in American society, he said.

Chief executives may not be happy to hear it, but some psychoanalytic consultants detect more than a whiff of pathology in the compulsion and single-mindedness it takes them to reach the top. And, if one of them crosses the line from eccentricity to outright mental illness, they say, he or she can infect the whole business.

''Take, for example, the behavior and actions of the first Henry Ford,'' wrote the managerial psychoanalyst Manfred F. R. Kets de Vries in a pioneering Harvard Business Review article in 1979, ''Managers Can Drive Their Subordinates Mad.''

Henry Ford may have been a genius, wrote Dr. Kets de Vries, today a professor of human resource management at Insead, a French business school, and the author of ''Life and Death in the Executive Fast Lane'' (Jossey-Bass, 1995). But Ford was also despotic, grandiose and perpetually on the prowl for imagined enemies, the professor said. Distracted and debilitated, Ford's leadership team spent years battling phantom enemies while the real foe, General Motors, gobbled up market share.

Psychoanalytic consultants say their approach to sick workplaces differs from that of traditional industrial psychologists, who observe human behavior and try to improve morale and productivity without delving into the human psyche. Nor do they advocate the once-popular use of psychological tests in recruiting, a technique that has fallen into some disfavor recently because of lawsuits asserting bias.

Instead, the consultants say their role is to plumb the unconscious of managers and executives, trying to identify motivating forces, never forgetting the premise that an individual's forgotten past can shape his or her behavior in the present.

No one lies on a couch; the consultants typically sit in on business meetings; study the way individuals interact; hold regular one-on-one sessions with executives; interview employees at lower levels; and analyze what they see and hear.

They don't march around telling managers they have Oedipus complexes and the like. ''That isn't helpful in an organizational setting,'' Dr. Settel said. But they are expected to make practical business recommendations to the board.

Dr. Sulkowicz said that when he first entered a workplace, he usually found himself ''the object of a benign, positive transference'' — in other words, the employees use him to recreate certain aspects of their relationships with their parents.

This soon changes, though. While working with the executive who was flirting with the idea of walling off his brother, Dr. Sulkowicz said, he began to have the uneasy feeling that ''transferences to me cast me in the role of the brother to be killed.''

Dr. Sulkowicz declined to reveal the identity of the family or the business in that case. In a presentation that preserved his subjects' anonymity, the doctor described to the American Psychoanalytic Association a veritable witch's brew under the company's buttoned-down exterior of repressed fratricidal fantasies, incestuous homosexual longings, parental abuse, efforts to attract love through outrageous acts and substance abuse aimed at dulling existential pain.

Can airing such things really help a business? Three months into working with the warring brothers, Dr. Sulkowicz reported, they were able to agree on a series of steps toward bringing their sons on board. And the one who wanted to put up the cinder blocks asked the psychoanalyst for his business card, saying he had a friend who might benefit from treatment.