Strategy. Innovation. Brand.
Seeing With Your Eyes
I’d be happy to check you in.
Some years ago, on a business trip, I checked into a hotel that had just implemented a new computer system. I asked the desk clerk how he liked it. He responded very positively: “It’s great. It’s so much better than the previous system.” He smiled broadly and spoke enthusiastically. I assumed that he was telling the truth.
I also noticed some telling details. He had to bend far forward to reach the keyboard. Then he had to tilt his head back to see the screen. It looked awkward to say the least. He couldn’t make eye contact with me and use the system at the same time.
More problematically, the system was rigid and field-oriented. The screen contained many fields, not all of which were necessary for each client. But you couldn’t skip a field. To get from Field A to Field Z, you had to navigate sequentially through Field B, then Field C, and so on. The poor guy must have hit the Return key a dozen times while checking me in. He couldn’t check me in and have a friendly conversation at the same time.
I noted two things about the situation. First, the man seemed genuinely pleased with the new system. He recommended it without reservation. (No pun intended). Second, the system really wasn’t very good. The man didn’t realize what he might have had.
I also thought about how I might act if I were an executive at the hotel company. If I listened to what the desk clerk said, I would congratulate the IT department, maybe give out a bonus or two, and move on to the next problem.
But if I looked instead of listening, I might have had a very different reaction. The system was awkward, physically uncomfortable, and not conducive to good customer communication. I might not have torn the system out, but I certainly would have requested an upgrade.
This is a pretty good illustration of the difference between seeing with your mind and seeing with your eyes. The desk clerk was seeing with his mind. He had a mental image of the old system (“clunky, user hostile”) and of the new system (“much improved”). He didn’t see what he was actually doing. He didn’t perceive any shortcomings because he was comparing it, not to an ideal system, but to an old system.
A good observer, on the other hand, would not compare the system to preconceived notions. A good observer would have no preconceived notions. She would merely observe and identify problems and opportunities.
My experience reminds me of the women who designed the Volvo concept car some years ago. If I were designing a car, I would assume that it “should” have a hood (bonnet) that opens. After all, all cars have hoods that open. There must be a reason. That’s a notion that I see in my mind’s eye, not in my physical eye.
The Volvo designers, on the other hand, simply observed how people used their cars. They noted that drivers rarely open the hoods. Indeed, they do so only to add windshield washer fluid. The designers asked a simple question: Why bother? They put a fluid filler opening on the outside of the car and simplified the entire front end of the car by eliminating the openable hood.
The designers created a car that is simpler, cleaner, lighter, and stronger. That’s good design. It comes from seeing the world as it is, not as it’s assumed to be.
Designing Minds
Designers.
I learned systems analysis in graduate school. I know how to use analytic tools to break a problem apart and fix the component parts. That is, I know how to use the tools if and only if I know that a problem exists. In most cases, somebody has to describe the problem to me.
Julia and Elliot, our son and daughter-in-law, learned design thinking in graduate school. They know how to observe closely and intuit what users need. They empathize and can see the world from the user’s perspective. They know how to suspend their assumptions and see the world as it is, not as it’s assumed to be. Paraphrasing Picasso, they see with their eyes, not their minds.
They also have the skills, of course, to design solutions to meet the user’s needs. They can even design solutions for problems that weren’t apparent to the user. Because of the way they observe the world, Julia and Elliot can identify problems and needs that I can’t.
Businesses are starting to realize that design thinking holds significant advantages over traditional methods of systems analysis. Design thinking is an observational skill as much as an analytical skill. It uses empathy and imagination to understand the world at a deeper level and design unexpected solutions.
What does it mean to be design-driven? McKinsey gives a simple definition: “…it’s a way of thinking: a creative process that spans entire organizations, driven by the desire to better understand and meet consumer needs.” For me, it’s not only a way of thinking but also a way of seeing. Designers see what the customer really needs, even if the customer doesn’t.
In this regard, design thinking seems similar to the art of negotiation. A successful negotiator sees what the other side needs — even when the other side doesn’t. The negotiator negotiates to that need. The designer designs to it.
In another article, McKinsey expands the definition and states a key benefit: “A design-driven organization is always thinking about its customers, empathizing with end users, and trying to solve problems while keeping its customers in mind. … Companies that have placed design at the center of the organization perform better.” (Italics added).
Design, in other words, provides a competitive edge. When I was fresh out of school, systems thinking was a competitive weapon. Today, it’s design thinking. Design used to be about things, objects, and spaces. Today, it can equally be used to create business processes and services.
The business world seems to be making a fundamental transition from analysis to design. Instead of decomposing a problem, innovative businesses are using imagination and empathy to create solutions. Julia and Elliot, in other words, have positioned themselves at the leading edge of a transformational new wave. What a great time to be young.
Innovation and Bananas
Start from the top.
We’ve all heard the admonition, “If it ain’t broke don’t fix it.” We often take it at face value – if something is working, don’t make changes. On the other hand, we usually roll our eyes when a colleague justifies a process by saying, “Well, we’ve always done it that way.”
So which is it? Should you accept a process simply because it’s traditional? Should you assume that it doesn’t need attention? If your business processes are working reasonably well, should you never review them? Should you never seek to improve a process that’s fulfilling its basic objective? Is it OK to accept that we’ve always done it that way?
When I think about these questions, I think about bananas. I’ve always peeled bananas from the stem. It works reasonably well most of the time. But occasionally the stem breaks off awkwardly and mashes the end of the banana. I’ve also noticed recently that snapping the stem can aggravate the arthritis in my thumbs. But, hey – it’s not a big deal. I’ve always done it that way. Why would I change something that’s not broken?
Then I learned that monkeys peel a banana from the opposite end. This is actually the top since bananas grow “upside down”. You simply pinch the top and the peel separates; then you pull it back. It’s simple, easy to do, essentially foolproof, and it doesn’t hurt arthritic thumbs. (Here’s an illustrated guide).
Now I peel bananas from the top rather than from the bottom. Each time I do, I think about innovation. It’s a simple thought – I should ask more questions about how I do things. Why do we things the way we do? It’s a simple process – we just observe and question. It’s so simple, in fact, that we can learn it from monkeys.
Critical Thinking and VUCA
It’s complicated.
When I teach critical thinking, I don’t focus much attention on the environment that we’re thinking in. We learn how to identify assumptions, assess evidence, understand our biases, and reach rational conclusions. The assumption in all this (and it’s a big one) is that these critical thinking processes will work in any environment.
But will they? What if you’re working in a VUCA environment? VUCA is a trendy acronym that originated in military planning circles. How do we teach our military leaders to make good decisions in environments that are Volatile, Uncertain, Complex, and Ambiguous? In a VUCA world, the environment in which we make decisions comes to the fore and may overshadow our thinking processes.
Indeed, in a VUCA world, one might conclude that planning, strategy, logic, and critical thinking are useless. As Nathan Bennett points out, even experienced business leaders are tempted to conclude that, “Hey! It’s a crazy world out there! What’s the use of planning?” (See also here).
Interpreting VUCA as one thing can indeed be overwhelming. But VUCA isn’t one thing – it’s four things. The first step in dealing with VUCA is to analyze which elements are most salient. Then we can adjust our strategy accordingly.
Let’s look at each of the four elements of VUCA:
Volatile – things are changing quickly. We need to understand the dynamics, speed, and direction of change. Just because the environment is volatile, however, doesn’t mean that it’s unpredictable. Disruptive innovations, for instance, create volatility but not uncertainty. If we understand the dynamics of disruption, we can make remarkably good predictions.
Uncertain – the environment is unpredictable; surprises happen all too often. Note that uncertainty doesn’t necessarily imply volatility. For instance, our society is certainly changing but the pace is rather slow. What’s uncertain is the direction of change.
Complex – there are a lot of moving parts and it’s not quite clear how they’re connected or how they interact with each other. It’s impossible to tell what will happen if I flip this switch or pull that lever. We regularly see this in political and economic debates. Will lowering taxes lead to greater growth and, therefore, higher tax revenues? Well … it’s complicated. Note that complexity is not the same as uncertainty or volatility.
Ambiguous – the signs are not clear and it’s easy to misinterpret what’s actually happening. We may confuse cause and effect. For instance, people who own their own homes are less likely to commit crimes. So, a government might institute a program to help people buy their own homes with a goal of reducing the crime rate. But what if we’ve confused cause with effect? What if people who don’t commit crimes are more likely to own their own homes rather than vice-versa? Cause and effect are often ambiguous. It’s useful to study them closely.
Taking VUCA as a single, integrated phenomenon can lead to a sense of futility and hopelessness. If the world is entirely random and chaotic, what can we mere mortals do? The trick is to decompose VUCA into its component parts. Analyze each component and then start plotting a strategy. (More on this in future posts).
VUCA environments call for a good dose of fluid intelligence to complement the crystallized intelligence in your organization. They also require a strong dose of critical thinking. Indeed, the more VUCA your environment, the more critical becomes critical thinking.
Greek Game Theory
Smooth operator.
Game theory suggests that it’s sometimes rational to behave irrationally. Case in point: Yanis Varoufakis, the Greek finance minister.
Varoufakis’ country is nearly bankrupt and other European community nations – especially Germany – hold the keys to any bailout. So you might expect Varoufakis to behave contritely toward his potential saviors. Far from it. Instead, he seems determined to make his opponents recoil in disgust and horror.
Varoufakis wears a black leather jacket (gasp!) to high-level ministerial meetings and lectures and hectors his fellow finance ministers. He’s rude, he shows up late, and his behavior borders on the bizarre. He alienates the very people who are poised to bail him out. In other words, he’s a very shrewd negotiator.
A Greek exit (Grexit) from the euro would create hardships for Greece and every other country in Europe (and perhaps far beyond). The European finance ministers claim that a Grexit would be much more “contained” than it would have been three years ago. But nobody knows for sure. It could spark a widespread panic.
Nobody wants a Grexit. But nobody can afford to give in either. Greece wants the bailout as long as it doesn’t include onerous conditions related to austerity and labor reform. Germany and the rest of the EC want to bail out Greece as long as they can claim that they’ve forced reforms on their wayward neighbor so that it will never happen again. Nobody wants a Grexit but both sides want a certain amount of theater.
An avid game theorist, Varoufakis knows that behaving irrationally is the best card he has to play. He needs to convince his opponents that he’s crazy. He wants them to think, “This man is just crazy enough to push the exit button. We can’t let that happen. We better not push too hard.”
As we learned the other day, behaving irrationally can cause the opposition to restrict their thinking and forego some options that might otherwise be perfectly acceptable. This is exactly what Varoufakis wants.
On the other side, the German finance minister, Wolfgang Schäuble, seems to be the designated “humiliator”. He’s taking a hard line and lectures Greece publicly and privately. He repeatedly reminds the Greeks that it’s time to clean up their act. Everyone knows that Germany is key to any compromise. By positioning the German finance minister (as opposed to say the Belgian finance minister) as Dr. No, the EC is trying to plant a simple thought in Greece: “These people really hate us. They might just pull the plug and force us out. We can’t let that happen. We better not push too hard.”
Both sides want to push the issue to the brink so they can tell their voters that they got the best deal possible. I expect two more weeks of theater followed by a compromise that no one likes but everyone can live with. In theory, it’s just a game.
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