Strategy. Innovation. Brand.

debacles

Eighteen Debacles

Debacles happen.

Debacles happen.

We have two old sayings that directly contradict each other. On the one hand, we say, “Look before you leap.” On the other hand, “He who hesitates is lost.” So which is it?

I wasn’t thinking about this conundrum when I assigned the debacles paper in my critical thinking class. Even so, I got a pretty good answer.

The critical thinking class has two fundamental streams. First, we study how we think and make decisions as individuals, including all the ways we trick ourselves. Second, we study how we think and make decisions as organizations, including all the ways we trick each other.

For organizational decision making, students write a paper analyzing a debacle. For our purposes, a debacle is defined by Paul Nutt in his book Why Decisions Fail: “… a decision riddled with poor practices producing big losses that becomes public.” I ask students to choose a debacle, use Nutt’s framework to analyze the mistakes made, and propose how the debacle might have been prevented.

Students can choose “public” debacles as reported in the press or debacles that they have personally observed in their work. In general, students split about half and half. Popular public debacles include Boston’s Big Dig, the University of California’s logo fiasco, Lululemon’s see-through pants, the Netflix rebranding effort, JC Penney’s makeover, and the Gap logo meltdown. (What is it with logos?)

This quarter, students analyzed 18 different debacles. As I read the papers, I kept track of the different problems the students identified and how frequently they occurred. I was looking specifically for the “blunders, traps, and failure-prone practices” that Nutt identifies in his book.

Five of Nutt’s issues were reported in 50% or more of the papers. Here’s how they cropped up along with Nutt’s definition of each.

Premature commitment – identified in 13 papers or 72.2% of the sample. Nutt writes that “Decision makers often jump on the first idea that comes along and then spend years trying to make it work. …When answers are not readily available grabbing onto the first thing that seems to offer relief is a natural impulse.” (I’ve also written about this here).

Ambiguous direction – 11 papers or 61.1%. Nutt writes, “Direction indicates a decision’s expected result. In the debacles [that Nutt studied], directions were either misleading, assumed but never agreed to, or unknown.”

Limited search, no innovation – ten papers or 55.5%. According to Nutt, “The first seemingly workable idea … [gets] adopted. Having an ‘answer’ eliminates ambiguity about what to do but stops others from looking for ideas that could be better.”

Failure to address key stakeholders claims – ten papers or 55.5%. Stakeholders make claims based on opportunities or problems. The claims may be legitimate or they may be politically motivated. They may be accurate or inaccurate. Decision makers need to understand the claims as thoroughly as possible. Failure to do so can alienate the stakeholders and produce greater contention in the process.

Issuing edicts – nine papers or 50%. Nutt: “Using an edict to implement … is high risk and prone to failure. People who have no interest in the decision resist it because they do not like being forced and they worry about the precedent that yielding to force sets.”

As you make your management decisions, keep these Big Five in mind. They occur regularly, they’re inter-related, and they seem to cut deeply. The biggest issue is premature commitment. If you jump on an idea before its time, you’re more likely to fail than succeed. So, perhaps we’ve shown that look before you leap is better wisdom than he who hesitates is lost.

How Does It Feel To Commit Prematurely?

Is it too soon to get married?

Is it too soon to get married?

In February, I wrote about premature commitment. According to Paul Nutt in his book, Why Decisions Fail, premature commitments all too often lead to debacles — decisions gone spectacularly and publicly wrong. The process is fairly simple: 1) we have a problem; 2) a beguiling solution is proposed; 3) we jump on the solution with undue haste and without considering our options or searching for alternatives. After all, we have a solution, don’t we? Why bother looking for another one?

As we read Nutt’s book in my classes, I can tell that students are grasping the general concept intellectually. It’s clear — intellectually and academically — that you shouldn’t commit too soon. Step back, look around, ask questions, survey the possibilities — then make a decision.

That’s all well and good in the classroom but will my students actually be patient when the pressure is on and everyone wants to be a hero? I’m not so sure. So, I’ve been looking for ways to show students what it feels like to make a premature commitment. By experiencing the process — rather than just reading about it — I’m hoping to imprint something on them. When you’re under pressure and a crisis is looming, it’s hard to think clearly. It’s easier to remember an experience than it is to organize your thoughts and respond to a novel situation.

I’ve discovered a video that helps students make the connection. Actually, I’ve known about the video for some time but I used to use it for a different purpose. Then it dawned on me that the video provides a good demonstration of a premature commitment. So, I’m re-purposing the way I teach it. Perhaps that’s an example of mashup thinking.

The video requires you to concentrate your attention for about 90 seconds and count the number of times a specific action happens. Here’s what I’d like you to do: Watch the video twice. The first time, focus intently on the task at hand (the video will explain what to do). Count the number of times the specified action happens and record the number. There is one (and only one) correct answer.  Then watch the video a second time and don’t bother to count. Just observe what goes on. Don’t read on until you’ve watched the video twice. You can find the video here.

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Watch the video (twice) before proceeding

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Did you miss anything the first time you watched the video? Did you notice it the second time? (I’m not going to give it away here but, if you find this confusing, send me an e-mail and I’ll explain it).

About two-thirds of the people who follow the instructions miss an important element of the video the first time they watch it. Perhaps the key phrase here is “people who follow the instructions”. Basically, I conned you into making a premature commitment. I convinced you that — to get the right answer — you needed to pay close attention to the action and count carefully. You decided that it was important to get the right answer, so you played by the rules I imposed. Because you played by the rules, you missed something important in the environment.

What’s the message here? It’s easy to get caught up in the situation. It’s easy to buy into the “rules” that a situation seems to impose on you. It’s easy to let other people rush you to judgment. It’s easy to con yourself. The next time you’re at work and a problem arises and everybody is rushing to find a solution, just ask yourself: “Am I missing the gorilla?”

Librarian, Farmer, Debacle

It's a quality issue.

It’s a quality issue.

In his book, Thinking Fast and Slow, Daniel Kahneman has an interesting example of a heuristic bias. Read the description, then answer the question.

Steve is very shy and withdrawn, invariably helpful but with little interest in people or in the world of reality. A meek and tidy soul, he has a need for order and structure, and a passion for detail.

Is Steve more likely to be a librarian or a farmer?

I used this example in my critical thinking class the other night. About two-thirds of the students guessed that Steve is a librarian; one-third said he’s a farmer. As we debated Steve’s profession, the class focused exclusively on the information in the simple description.

Kahneman’s example illustrates two problems with the rules of thumb (heuristics) that are often associated with our System 1 thinking. The first is simply stereotyping. The description fits our widely held stereotype of male librarians. It’s easy to  conclude that Steve fits the stereotype. Therefore, he must be a librarian.

The second problem is more subtle — what evidence do we use to draw a conclusion? In the class, no one asked for additional information. (This is partially because I encouraged them to reach a decision quickly. They did what their teacher asked them to do. Not always a good idea.) Rather they used the information that was available. This is often known as the availability bias — we make a decision based on the information that’s readily available to us. As it happens, male farmers in the United States outnumber male librarians by a ratio of about 20 to 1. If my students had asked about this, they might have concluded that Steve is probably a farmer — statistically at least.

The availability bias can get you into big trouble in business. To illustrate, I’ll draw on an example (somewhat paraphrased) from Paul Nutt’s book, Why Decisions Fail.

Peca Products is locked in a fierce competitive battle with its archrival, Frangro Enterprises. Peca has lost 4% market share over the past three quarters. Frangro has added 4% in the same period. A board member at Peca — a seasoned and respected business veteran — grows alarmed and concludes that Peca has a quality problem. She sends memos to the executive team saying, “We have to solve our quality problem and we have to do it now!” The executive team starts chasing down the quality issues.

The Peca Products executive team is falling into the availability trap. Because someone who is known to be smart and savvy and experienced says the company has a quality problem, the executives believe that the company has a quality problem. But what if it’s a customer service problem? Or a logistics problem? Peca’s executives may well be solving exactly the wrong problem. No one stopped to ask for additional information. Rather, they relied on the available information. After all, it came from a trusted source.

So, what to do? The first thing to remember in making any significant decision is to ask questions. It’s not enough to ask questions about the information you have. You also need to seek out additional information. Questioning also allows you to challenge a superior in a politically acceptable manner. Rather than saying “you’re wrong!” (and maybe getting fired), you can ask, “Why do you think that? What leads you to believe that we have a quality problem?” Proverbs says that “a gentle answer turneth away wrath”. So does an insightful question.

 

 

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