Challenge your SOTP
Jan. 10, 2002
By Timothy Palmer
In today's faltering economy, many business leaders are scrambling to keep their organizations afloat. After years of growth, efficiency, productivity and fiscal restraint are again top priorities requiring managers to fortify their core competencies.
But there's one important success factor most executives never examine: their own thought processes.
Our memories and thought processes are structured for efficiency. Executives, and everyone else for that matter, rely on certain knowledge bases and assumptions when making decisions, often taking mental "shortcuts." For the most part, this serves us well. But when we're striving to keep or create success, these staid thought patterns can be hazardous.
For years, business leaders and motivational speakers have been urging us to "think out of the box." It's become a cliché that makes many of us groan, but how many people really do manage to climb out of that proverbial box? A scant few, because most of us are locked into unconscious thought patterns that can block innovation.
For example, consider how companies measure success. Human instinct leads us to frame our performance in a positive light. Perhaps a company's performance pales in comparison to its competitors, but it looks pretty good when contrasted against last year's numbers. So we gravitate toward the positive-year-end reports boast about improvements from the previous year, with scant mention of the company's overall industry standing.
So what's the problem? Improvement, after all, is a positive thing, and is good for morale. But this tactic is actually quite dangerous. There's a wealth of research that shows people who frame their performance positively tend to be very risk averse. In essence, they don't want to jeopardize their recent successes. And companies that avoid taking risks seldom succeed over the long haul.
Human nature also comes into play when executives examine failure. The classic reaction is to blame failure on outside influences. I often observe this behavior in my classroom. When I hand back an exam with a failing grade, a student's reaction is often, "Oh, that professor is so unfair," or "The questions were tricky," and so on. Seldom does the student think, "Gee, I really should have studied harder," or "What can I change so I get a better grade next time?" Executives do this, too. When we lose a bid or a product fails, our instinct is to blame someone or something we have no control over such as a weak economy, a reckless competitor, or even the weather! To ensure success in the future, we must attribute the failure internally, so we can learn, move on and do better next time. This may sound pretty basic, but our ingrained thought patterns are unconscious and incredibly powerful. Few people actually manage to break free from these self-serving biases.
A company's standard operating procedures, or SOPs, can also be hazardous. Take a wedding, for instance. You know the basic script before you go: groom stands at the altar, bride walks down the aisle to join him, vows are made, they kiss, people throw rice. You don't consciously think through those expectations, it's just the way things are done. That's fine for weddings, but within an organization it's often useful, even necessary, to examine SOPs from time to time.
Occasionally, an outsider must be brought in to shake things up, as happened a few years back at Sears, Roebuck and Co. For years, company leadership had been tied to a particular idea of what it meant to be Sears-a certain kind of retailer, anchored by its famous catalog. When a new CEO began questioning the wisdom of the money-losing catalog, employees were aghast. "We can't get rid of the catalog, we're SEARS!" The CEO's retort? In essence, he said, "Of course we can get rid of the catalog! It's expensive and it loses money year after year after year, despite our best efforts to revive it. Why on earth would we keep it?"
Standard operating procedures are also a factor in hiring. Our instinct is to hire people like us-those who look, sound and act like we do. Again, all us this is all quite subliminal. We don't consciously set out to hire a clone, but we naturally shy away from those who are too different. IBM, with its famously stuffy, starched-shirt corporate atmosphere, is not likely to hire the prospect who comes to the interview wearing leather with nose and eyebrow rings. "He won't fit in," the manager might say, or perhaps something as nondescript as, "I just don't think she's right for the job."
But to stay on top, the prospect may be exactly what IBM needs. Companies benefit from so-called troublemakers who question the status quo and feel free to speak up against "the way we've always done things." Surrounded by people who all think similarly, we can become blind to the real challenges and threats facing a business.
Just being aware of our unconscious biases is the first step toward conquering them. So next time you catch yourself making an important decision without careful thought, step back and question yourself. And maybe give the guy with the eyebrow ring a chance.
Dr. Timothy Palmer is an assistant professor of management in the Haworth College of Business at Western Michigan University. This column was originally published in the Dec. 19, 2001, issue of MiBizSouthwest and is reprinted in WMU News with their permission. The article is part of a monthly MiBiz series featuring professors from the WMU Haworth College of Business.
Media contact: Jessica English, 269 387-8400, jessica.english@wmich.edu