Strategy. Innovation. Brand.

Critical Thinking

Decision Theater

And what does the devil’s advocate have to say?

In major corporate decisions, a devil’s advocate can serve an invaluable function. The advocate can help stress test an idea and point out cognitive biases that others might miss. The big idea is put on trial. Executives who proposed the idea serve as defense attorneys. The devil’s advocate is essentially the prosecutor. She looks for weaknesses in the other side’s case and serves up an alternative narrative. She also helps the team protect against the down side. The advocate helps us make the decision right — using a balanced process that tends to dampen major biases.

All too often, however, the process devolves into “decision theater”. We’re just playing roles that don’t improve the decision process but do make us feel better about it. Here’s how I’ve seen it play out in various software companies:

  • Only a small number of people play the devil’s advocate (DA) role. They do it voluntarily and they get little or no support in terms of resources or even encouragement. Each time we had a meeting about a big decision, the same people  spoke up to say, “Well … let me be a devil’s advocate here …” I admired these people but I also wondered, Why do so few people step forward in this role? How could the company promote this role as a regular part of the decision process?
  • In these meetings, the devil’s advocate’s objections were always “handled”. In other words, the leader of the meeting (often the CEO) would thank the devil’s advocate for the input and then give a breezy statement that effectively dismissed the input.  We all felt better because we had “considered” the other side. But had we really?
  • Prior to the meeting, the devil’s advocate had very few resources to develop a coherent position. The DA didn’t have any staff to gather information or budget to hire consultants, etc. The DA’s position might be very thoughtful .. but it wasn’t well developed with evidence to back it up. It could easily be dismissed.
  • This is what I call “decision theater.” We believe we’re contributing to a good decision process, but we’re really just acting out roles.

I certainly respect people who play the devil’s advocate role. To make this more than theater however, organizations need to change the process. How? Well, let’s look at the history of the devil’s advocate.

The Catholic church originated the role of the devil’s advocate in 1587. The advocate plays a key role in the process of canonization — determining whether a person should be declared a saint. The process includes a trial, with one side arguing that the person does indeed deserve sainthood. The other side — led by the devil’s advocate — argues the opposite. The devil’s advocate aims to poke holes in the other side’s argument, For instance, the advocate might claim that the miracles attributed to the person were actually frauds.

From my perspective, the most important element was that the church gave the advocate resources and respect to fulfill the role effectively. The devil’s advocate had resources — time, money, staff — to call on. This differs greatly from devil’s advocates in today’s corporate world, who may speak up but are not institutionally supported. A corporation that wants to debias its decision processes should do what the Catholic church did — institutionalize the role and provide enough support to make it serious.

Scanning The Future From Singapore

Seriously cool dude.

Can you use a slide rule? The ability to use one effectively could become an important status symbol in the future.

That’s just one idea that I plucked (with a little extrapolation) from Foresight, the biennial scan-the-horizon publication from Singapore’ s Center for Strategic Futures (CSF). Singapore, of course., is a very small country buffeted by giants. CSF describes the country as a “price-taker” – it must accept prices set by other market players.

So how will Singapore survive? That’s the basic question that CSF aims to answer in a series of symposia, structured thought processes, debates, stories, suggestions, conferences, nudges, and “sandboxes”. The idea is to keep ideas about the future top of mind among Singaporean leaders. As CSF says, “Nobody can predict the future, but we can be less surprised by it.”

Since 2012, CSF has published a Foresight document every other year. (Click here for the complete collection). The 2019 edition was published on July 1 and makes for fascinating reading.

CSF uses a structured process based on scenario planning to scan the horizon and create ideas about the future. (For some background on scenario planning, click here, here, and here).  CSF calls its approach Scenario Planning Plus, which “retains Scenario Planning as its core, but taps on a broader suite of tools more suitable for the analysis of weak signals, and thinking about black swans and wild cards.” Scenario Planning Plus has six key purposes:

  • Defining focus – is the problem simple, complicated, complex, chaotic, or disorderly? (See the Cynefin Problem Framework Definition).
  • Environmental Scanning – identify critical emerging issues.
  • Sense making – “… piece together a comprehensive and comprehensible picture of an issue.” CSF develops Driving Force Cards to stimulate creative discussions about these issues. (Click here for the current set).
  • Develop possible futures – tell stories about what we do, think, and worry about in the future.
  • Design strategies – given the various possibilities, how can we best respond to the future?
  • Monitor – keep track of indicators, forward signals, and strategies to understand what’s happening and why. (Reading all of CSF’s Foresight documents gives a sense of how our perceptions have changed in just ten short years).

I encourage you to read through the Foresight document and to print out the Driving Force Cards to use in your planning sessions. They’ll stimulate your thinking in both practical and unexpected ways. To give you a sense of what the Foresight document contains, here are some ideas that I found especially interesting:

  • Time banking – a marketplace where we exchange time instead of money. Such a marketplace might help us use our time more wisely.
  • Heatstroke vaccinations – what if we can’t stop global warming? Maybe we could enhance humans to live in a warmer world. A vaccine against heatstroke would be a good start.
  • Cobots – will robots replace humans in most production processes? Or will a combination of humans and robots – cobots – be a better solution?

And why might using a slide rule become a status symbol? When everything goes digital, being able to use analog devices could become a mark of distinction. We already see audiophiles abandoning digital recordings and returning to analog wax discs. Why not slide rules, too?

Finally! A Way To Measure Corporate Culture.

What do they really think?

I tell my management students that executives should focus on one task above all others: developing a positive, supportive corporate culture. When a company has a positive culture, all things are possible. When a company has a negative culture, very few positive outcomes occur.

The problem, of course, is how to assess a culture. How does one know if a culture is positive or negative? It’s perhaps the most important question an executive (or job applicant) can ask. But the answer is murky at best. Further, how can one tell if a culture is getting better or worse? Is the company living up to its professed values? How does one know?

A new company called CultureX may help us solve the problem. Formed in conjunction with MIT’s Sloan School of Management, CultureX uses the millions of employee reviews on Glassdoor to analyze corporate cultures. Along the way, CultureX identifies the most frequent values companies profess, the norms used to promote those values, and how employees view company performance in fulfilling the values.

CultureX uses a range of textual analysis tools to analyze free-form employee comments in Glassdoor reviews. The result is a composite view of what it’s like to work in an organization – from employees’ perspective. As you might expect, employee reviews often highlight what the company actually values as opposed to what it professes to value.

CultureX initially applied its methodology to analyze 1.2 million Glassdoor reviews for some 500 companies. The average Culture 500 company has over 2,000 employee reviews. The analysis identified some 60 “… distinct values that companies listed in their corporate values statements.” From the 60, CultureX researchers winnowed the list down to the Big Nine that were cited most frequently. These are: agility, collaboration, customer, diversity, execution, innovation, integrity, performance, and respect.

CultureX researchers then built an interactive tool which “… provides users a snapshot of how frequently and positively employees … speak about each of the Big Nine values.” Users can see how employees discuss each of the Big Nine – even those that a company doesn’t include in its own values statements.

CultureX uses Amazon as an example of how the tool might be used. Amazon’s employee reviews, for instance, spoke frequently and positively about two specific values: innovation and customer centricity. (Innovation was about two standard deviations above the mean; customer centricity was about one standard deviation above). On the other hand, employees were “much less enthusiastic” about the company’s respect for employees – about 1.5 standard deviations below the mean.

How might one use these data? An Amazon executive might be concerned that employees don’t feel respected. The executive might develop programs to improve the company’s performance. (I’m sure that consultants from CultureX would have some suggestions). The executive could then use changes over time in the “respect” value to monitor progress (or lack of it). Similarly, an executive might compare her own company to any number of other companies – in the same industry or in others – to identify competitive gaps and/or advantages.

But the data are not reserved solely for executives. Want to work for a company that is truly innovative? The CultureX data can help you identify which companies are walking the walk and not just talking the talk. Potential employees can identify companies that match their value set. Companies can identify potential employees whose values match the company’s. With better information, both sides stand to benefit.

CultureX’s work should help us focus more attention on the role of corporate culture in business success. The data set could become a useful platform for investors, executives, employees, and job applicants. So … how’s your company doing?

Whom Do You Trust? America or Facebook?

Do we need it anymore?

The promise of cryptocurrencies is that we can create a widely-acceptable medium of exchange without having to trust anyone.  Cryptocurrencies have no central authority, no government agency to vouch for them. We don’t need to trust a government or a bank or a stock exchange. Elites can’t cheapen our currency because no elites are involved. Indeed, no one is involved. The currency is distributed across multiple computers and multiple networks. To manipulate the currency, one would need to control all the computers in the world – a seemingly impossible task.

In the original conception, the value of a cryptocurrency is based on nothing more than supply-and demand. Value is not linked to any physical asset like gold or oil or even paper currencies like dollars. Since there is no asset behind the currency, no one can manipulate the value of the currency by manipulating the underlying asset. Rather than trusting a government or an agency or a bank, we place our trust in an algorithm distributed around the world.

(The distributed nature of cryptocurrencies also makes them quite slow. Speeding up transactions is a major challenge for blockchain researchers. The most promising solution seems to be “sharding” – a technology worth keeping an eye on.)

Traditionally, we’ve trusted governments to create and maintain the value of national currencies. That’s been a pretty good bet in the United States, less so in Venezuela. But, really, do we need a nation to create a widely acceptable currency? Cryptocurrencies suggest that the answer is “no”.

But there’s a not-so-subtle problem with cryptocurrencies. The elephant in the room is that many people (myself included) view cryptocurrencies as a new version of the Wild West – a territory populated by libertarians, wild-eyed visionaries, snake oil salesmen, drug dealers, scam artists, and terrorists. And, by the way, some person created the algorithm and could potentially manipulate it for illicit purposes. Simply put, the current cryptocurrency scene does not inspire trust.

To fill the trust gap, several “trusted” agencies have stepped forward to offer cryptocurrencies based on a trusted brand and/or on physical assets. Case in point: J.P. Morgan Chase’s “JPM Coin”. Announced earlier this year, (click here, here, and here) JPM Coin is backed by a major bank and based on a physical asset: the U.S. dollar. The company touts JPM Coin as a simpler, faster way to make and clear payments.

This past week, of course, another “trusted” organization – Facebook – announced that it will introduce a new digital currency called Libra next year. (Click here and here). Facebook wraps its announcement in humanitarian gauze – it’s simply providing an effective payment service to the world’s unbanked citizens. As Evgeny Morozov points out, however, Facebook is actually doing two things:

  • Preparing to take on China’s social media giants, Tencent and Alibaba, which already combine payments and communications.
  • Positioning itself as a “as a rebel force against mediocre bureaucrats and sluggish corporate incumbents”. It’s doing battle against a coalition of lazy, inept, corrupt – untrustworthy – bankers, bureaucrats, and politicians. Morozov suggests that Facebook is activating its populist supporters to keep regulators at bay. More broadly, it’s a “plan to break the global financial system.”

Could Facebook’s Libra actually become a global currency at the expense of the dollar, yen, Euro, and renminbi? Facebook currently has 2.38 billion active users. That number makes even China’s population look small. If a significant portion choose the Libra over existing currencies, then the money we know today could become irrelevant. If a nation’s currency is irrelevant, how relevant is the government?

Given all this, here’s a basic question — whom do you trust more: 1) the American government; or 2) Facebook?

(Note that JPM Coin and Libra are not truly cryptocurrencies, at least not in the original sense of the word. A cryptocurrency has three elements: 1) No central authority, agency, governing body or processor. Clearly J.P. Morgan and Facebook are centralized governing bodies. 2) No physical assets backing the currency. JPM Coin, uses the U.S dollar as its backing asset – it’s a digital currency based on a fiat currency. Facebook says that Libra will be based on physical assets, though it hasn’t quite defined them. 3) Permissionless – you don’t have to ask anyone’s permission to use a cryptocurrency. To use JPM Coin, you need to have an account at J.P. Morgan. To use Libra, you’ll need a Facebook account. Given this, it’s probably best to call JPM Coin and Libra “digital currencies” as opposed to “cryptocurrencies”.)

What’s Walking Good For?

No, I don’t think you should marry Tom.

I often ask my students a simple question: What were you doing the last time you had a good idea? Whatever they answer, I say: “Do more of that and you’ll have more good ideas.”

So what are they doing when they have good ideas? A fair number – often a majority – are walking. Taking a break and going for a walk stimulates our thinking in ways that produce interesting and novel ideas. Walking takes a minimum amount of conscious effort; we have plenty of mental bandwidth left for other interesting thoughts. Walking also provides a certain amount of stimulation. The sights and sounds and smells trigger memories and images that we can combine in novel ways. By moving our bodies slowly, we create thoughts that move much more quickly.

Going for a walk with a friend, colleague, or loved one can also help us create richer, deeper conversations. Walking stimulates novel thoughts; if a companion is beside us, we can share those thoughts immediately. The back-and-forth can lead us into new territory. A good conversation is not just an exchange of existing ideas. Rather, it produces new ideas – and walking can help.

Walking can also help us have difficult conversations. The key here may be our posture and proximity rather than walking per se. When we walk with another person, we are typically side-by-side, not face-to-face. We’re not confronting each other physically. We’re talking to the air, rather than at each other. We’re slightly insulated from each other, which makes it easier to both make and receive blunt statements. 

According to Walk-And-Talk therapists like Kate Hays, walking can also enhance traditional psychotherapy sessions. Walking with a therapist “…spurs creative, deeper ways of thinking often released by mood improving physical activity.” Walking seems especially helpful when the conversation is between a parent and, say, a teenager. We feel close, but not intimidated. (Side note: we often describe deep conversations as “heart-to-heart” but rarely describe them as “face-to-face.”)

What else can walking do? It’s an “active fingerprint.” As the MIT Technology Review puts it, “… your gait [is} a very individual and hard-to-imitate trait.” In other words, the way you walk uniquely identifies you.

Clearly, we can use gait-based identification for positive or negative ends. With so many security cameras in place today, we’re rightly concerned about facial recognition as an invasion of privacy. But we can hide our faces with something as simple as a surgical mask. Disguising the way we walk is much more difficult.

On the other hand, think of a device – perhaps a smart phone – that can uniquely identify you based solely on your gait. You put your phone in your pocket and walk along; it “knows” who you are. Rather than depending on fingerprints or passwords, the device simply monitors your gait. One benefit is convenience – you don’t have to enter a password every time you want to use the device. The second benefit is perhaps more important: security. A thief could steal your password or even an image of your fingerprint. But could they imitate your gait? Probably not.

What else is walking good for? Oh, simple things like health, flexibility, weight loss, mental acuity, sociability, and so on. I’d like to hear your stories about the benefits of walking. Just send me an e-mail. I’ll read them after I get back from my walk.

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