Summer Rerun: Is Thinking Going Out of Fashion?

This post first appeared on May 11, 2007

I am beginning to suspect that many are reacting to the overstimulation of the modern world – the accelerating pace of change, data overload, time pressure, work and relationship instability – by turning off their brains. The rise of fundamentalism and the “family values” push, both efforts to turn back the clock, is one set of responses.

Another is the rise of sound-biting, of using pithy communications to cut through the clutter of the daily information assault. But sound biting is inherently reductionist. It doesn’t permit nuanced argument, or pointing out fuzziness in data, or shades of grey. Sound bites are great for simple, emotional appeals, lousy for policy development (which is one reason why this country seems incapable of having an intelligent discussion on important topics like health care. The public has been trained out of having a long enough attention span to listen to alternatives).

Sound biting polarizes people, and makes it hard to find common ground (where can Bush go with Iran now that he has called them a member of the “axis of evil,” for instance?).

So I get worried when I see smart people embracing the logic of sound biting and seeing it as a more general prescription, particularly when they want to use it to run organizations, as opposed to sell shampoo or wars. Let’s look at this post by Brayden King at orgtheory.net:

Made to Stick is a book by Chip and Dan Heath that explores why some ideas grab our attention and others quickly fade from memory. The book has received a lot of attention in the consultant-y side of the blogosphere….

One of their main premises is that sticky ideas tend to be simple. By simple they don’t mean simplistic; rather they mean that each idea can be reduced to its essential, most important core. To communicate an idea clearly, you need to strip “an idea down to its most critical essence” (28). You need to “find the core.”

My immediate thought was that I need to do a better job in finding the core of some of my papers.* But “finding the core” also applies to organizations. Most organizations are based on some sort of core idea. They have an irreducible essence upon which the logic of the organizing, decision-making, and strategizing rests. Some organizations, of course, are better at communicating that core to their stakeholders. They’ve figured out how to make that idea central to decisions and to the daily life of the organization.

One example that the Heaths provide in the book is how Southwest Airlines used the idea that “We are THE low-fare airline” to guide important decisions. When Southwest has to decide whether they’re going to offer a new food item to be served on their flights, like chicken salad, they can go back to their core guiding principle to assess whether it would be a beneficial change. The answer is no. Providing chicken salad, as good as it might sound, does not fit with Southwest’s principle of being THE low-fare airline….

I think we need to develop better theories of decision-making in businesses and I think that the identity concept is a good place to start. Some theories of decision-making seem very weak in their ability to actually predict what kinds of decisions would be good for the organization (from the manager’s perspective). For example, the rather simplistic (not simple) idea that managers make decisions based on what they think will maximize shareholder value falls apart once you consider the hundreds of ways that a manager might try to maximize value at any given moment. Using the decision-making criterion of “our company maximizes value” is vacuous. Every business works under this principle, and so it gives the manager no guidance when attempting to make a decision that is unique to its organization. It begs more questions than it provides answers. Managers need more than a motive to maximize value….

The point of bringing up Heath and Heath and Whetten’s work on identity is that both readings seem to be saying the same thing. People or organizations need a core idea to motivate decision-making. We need a simple guiding principle. Whetten says that the core idea is the identity of the organization. If you can identify the central and distinctive character of the organization, you have found that which makes the organization unique from its peers. You know what works (the identity has at least gotten you this far), and you know what stakeholders expect (enough customers and employees like your identity to make the organization a worthwhile venture).

Thus, using the identity as a core principle to guide decision-making makes sense. When faced with a decision, managers put themselves in the place of the organization as if it were a real actor – what should an organization like this do? Sure, if you’re a business you assume that the end goal of any decision should be to maximize returns. But how you do it is contingent on the unique, core idea of the organization. As Whetten and Mackey (2002: 396) argue, identity is the “court of last resort.” When you reach that fork in the road, your identity pulls you down the eventual path.

Ooof. This all sounds great (particularly the bit debunking maximizing shareholder value) until you think about it a bit. Make It Stick argues that “simple ideas (when well expressed) are memorable.” Granted. It then goes on to see simple ideas as being virtuous. That is, if you can’t reduce your idea to simple idea, by implication, there is something wrong with it or with you.

No doubt writers should strive to be as clear as possible. But some of the most thought-provoking, and useful thing I have read (and they are very well written to boot) can’t be boiled down to a simple sentence or two because they are bigger than that.

For example, the best management book I have read in quite a while is Phil Rosenzweig’s The Halo Effect. It is a brilliant, important, yet accessible piece of work, it tells you that just about everything written about management is wrong, but it cannot be summarized in a sentence, or even two. Here is one reviewer’s stab at it:

Rosenzweig tells us that our beliefs about business success are largely, perhaps entirely, wrong, distorted by the halo effect — in this case, the idea that once we consider a company successful, we tend to see it as doing everything right.

That’s about as much as you can convey in one sentence, yet you are left wondering what the book is about, and it actually does take some explaining to grasp Rosenzweig’s thesis:

In World War I, psychologist Edward Thorndike asked commanding officers to rank their subordinates on a series of qualities. He found the answers to be highly correlated; in other words, the officers saw the soldiers in broad-brush positive or negative terms, as either all good or all bad….

To illustrate his point, Rosenzweig goes through case studies of Lego, Cisco, and ABB. For example, when its fortunes were rising, Cisco was praised for “extreme customer focus,” skill in acquisition and integration, and highly motivated employees. Yet when performance fell, critics saw many of these previously admirable attributes as causes of failure. Cisco’s problem wasn’t that it had ridden a bubble that collapsed — no, it had “a cavalier attitude toward customers.” Its deals had been haphazard, employees had been “too busy taking orders and cashing stock options to bother with efficiency, cost-cutting, or teamwork.” Academics joined the media in this reputational pump-and-dump. As the author explains: “No one was saying that Cisco had changed between 2000 and 2001. It was just that now, in retrospect, Cisco was described through a different lens — one of failing performance. . . . Placing these accounts together, the impression is nothing short of Orwellian — a rewriting of history that thrusts facts into the past, rearranging the record . . . reinterpreting the past to suit present needs.”

The implication is that books like In Search of Excellence and Good to Great are mere exercises in storytelling, because their main data sources, press reports and retrospective interviews, ar hopelessly tainted by the halo effect. And he goes on to prove analytically that their findings were incorrect.

Now Rosenzweig’s book has a very important message, but I challenge you to boil it down to even three sentences. As a consequence, (and Make It Stick is borne out here) it won’t have the impact it ought to. But by the Heaths’ logic, popularity is tantamount to merit. That just ain’t so. In fact, one could argue that one way to get ahead in a competitive world is to have an information advantage, and seek out more complicated constructs that are ignored in a dumbed-down world.

Let’s go on to their organizational argument, that companies should find a simple idea to guide all their decisions, which is even more dodgy. That premise holds if you have a strategy, like Southwest’s, that is distinctive and can be boiled down to a simple tag line.

I can too readily think of companies that have powerful cultures that are key to their success where no such tag line would or could exist. Let’s start with two: Goldman Sachs and Toyota. Each is unquestionably the dominant player in its arena. Each has a very strong culture. But if you were ask employees of either firm for a single principle, you wouldn’t get the simple actionable phrase that the Heaths idealize. At Goldman, they’d look at you like you were nuts. The firm has 14 guiding principles. Each is more than a sentence long. And the firm (at least historically) believes deeply in them and amazingly enough, operates from them.

A recent New York Times feature on Toyota describes a similar, multifaceted, yet cohesive culture. Toyota, unlike Goldman, does have an overarching ambition: “To enrich society through the building of cars and trucks.” That doesn’t provide the kind of decision guidance that the Heaths like, and the American writer has to explain what it means:

I lost count of how many times Toyota executives, during the course of my reporting, repeated it and how often I had to keep from recoiling at its hollow peculiarity. And yet, the catch phrase — to enrich and serve society — was not intended, at least originally, to function as a P.R. motto. Historically the idea has meant offering car customers reliability and mobility while investing profits in new plants, technologies and employees. It has also captured an obsessive obligation to build better cars, which reflects the Toyota belief in kaizen, or continuous improvement. Finally, the phrase carries with it the responsibility to plan for the long term — financially, technically, imaginatively. ”The company thinks in years and decades,” Michael Robinet, a vice president at CSM Worldwide, a consulting firm that focu

ses on the global auto industry, told me. ”They don’t think in months or quarters.”
The core mission is elucidated through other Toyota maxims, some of which make more sense to Westerners than others. And it also leads to behaviors that are alien to most companies. Toyota employees are obsessed with finding problems, be they with the cars, with marketing, with processes, because they see them as an opportunity for improvement. And to them, it is all part of “enriching and serving society by making cars and trucks.” But that message has all of the other ramifications because management has imbued that simple phrase with a great deal of meaning and many corollaries. The phrase is not what guides the culture. The phrase is much smaller than what it has come to mean at Toyota. The NYT author spent a long paragraph explicating it and still hadn’t distilled it.

The failing of the Heaths’ idea is due to another important construct, obliquity that isn’t summarized in a tag line. A Financial Times article explains:

If you want to go in one direction, the best route may involve going in the other. Paradoxical as it sounds, goals are more likely to be achieved when pursued indirectly. So the most profitable companies are not the most profit-oriented, and the happiest people are not those who make happiness their main aim. The name of this idea? Obliquity….

George W. Bush speaks mangled English rather than mangled French because James Wolfe captured Quebec in 1759 and made the British crown the dominant influence in Northern America. Eschewing obvious lines of attack, Wolfe’s men scaled the precipitous Heights of Abraham and took the city from the unprepared defenders. There are many such episodes in military history. The Germans defeated the Maginot Line by going round it, while Japanese invaders bicycled through the Malayan jungle to capture Singapore, whose guns faced out to sea. Oblique approaches are most effective in difficult terrain, or where outcomes depend on interactions with other people. Obliquity is the idea that goals are often best achieved when pursued indirectly.

Obliquity is characteristic of systems that are complex, imperfectly understood, and change their nature as we engage with them…..Obliquity is equally relevant to our businesses and our bodies, to the management of our lives and our national economies. We do not maximise shareholder value or the length of our lives, our happiness or the gross national product, for the simple but fundamental reason that we do not know how to and never will. No one will ever be buried with the epitaph “He maximised shareholder value”. Not just because it is a less than inspiring objective, but because even with hindsight there is no way of recognising whether the objective has been achieved…..

Most businesses operated in competitive environments far too complex for a terse phrase to be a useful guide to action. Yet a magic incantation, a talisman, a battle cry is terribly appealing. But those who can resist the temptation of relying on a simple playbook and face the complexity and uncertainty of their environment are likely to steer a better path. But understanding risk and adapting also demands far more courage that trusting simple ideas.