Digital Equipment Corporation didn’t survive the death of the minicomputer. K&E didn’t survive the death of the slide rule. GEISCO didn’t survive the death of mainframe timesharing. Why?
One of Marshall McLuhan quotes I love is, “I don’t know who invented water, but I know it wasn’t the fish.” Peter Drucker identified that one of the biggest challenges of large corporations is that as the number of management layers increase, the CEO and Senior Executives become increasingly focused internally.
Motivated reasoning is the process by which this happens. As David P. Redlawsk, a professor of political science at Rutgers University, said: “We are all somewhat impervious to new information, preferring the beliefs in which we are already invested. We often ignore new contradictory information, actively argue against it or discount its source, all in an effort to maintain existing evaluations. Reasoning away contradictions this way is psychologically easier than revising our feelings. In this sense, our emotions color how we perceive ‘facts.’ ”
Over my business career, I’ve not only seen dozens of examples of motivated reasoning, I’ve personally experienced and been damaged by a few. “The CEO’s vision must be ok. No venture capitalist would continue to put money in if it wasn’t.” Nope, the vision turned out to be utter nonsense. “Our sales management software will dominate the market because it isn’t just address management software.” Nope, the market went to ACT, a glorified address management system so simple that even salesmen could learn it. I could go on, but it would be too painful.
So, how do you avoid falling into the trap of motivated reasoning? You need to tap into diverse sources of opinion. First, you need to interact with people who literally “have boots on the ground” — namely, your employees and customers who are deep into the forest and spend their waking hours among the trees. Second, you need to interact with caring but uninvested folks who can recognize the forest for the trees, such as CEO peer groups like Vistage or the CEO Club. Third, you need to build and sustain a senior management team that shares a common visualization of the future but brings real-world perspective on how to get there utilizing their understanding of markets, customers, finance, development, HR, development, and operations.
Additionally, you need to create forums for creating your visualization of the future. Rather than visualizing the future as a continuation of the past, you need to look out and ask where you want to be in five years and why you want to be there. The forum should address answering the “why” question, how you are planning to get there, and what you need to be working on today in order to implement the “how.” Addressing those questions should raise issues that can overcome motivated reasoning.
A proven strategic planning process that translates vision into reality creates such a forum. For more insight on how strategic planning can benefit you, take a look at our website, http://www.myrna.com/Strategic-Planning-Benefits.