There is a corollary to this principle that has gotten the financial industry into such difficulties: assuming that past levels of risk and relationships will persist. We can generalize this for the larger business world into the idea that what has worked for some period of time is liable to continue.

Combine these two ideas and you have built the path that leads directly to poor decisions.

The situation gets even worse if you have been correct in the past. Past success leads to even more confidence in your ideas and the strengthening of the belief that your correctness will continue.

There are some people out there where this idea of perpetual correctness does seem to be true.  Unfortunately for most of us, they are a very rare breed.  Most of us live in the zone of fooling ourselves too often into believing that all will continue to flow along nicely.

One of the things to watch out for is vehemence. The more vehement you are about ridiculing those who think you are wrong, the more likely they are right. I’ve noticed how often the less evidence someone has the stronger their belief in their rightness.

Luckily there is a solution. Seek out those who think you are wrong. Seek out those who have differing opinions. Seek out those willing to push back strongly and force you to reexamine your assumptions and ideas.

The difficult part is listening.

To be clear, I am not saying that you will be wrong all the time or even most of the time. It’s that huge blind spot you need to find before it leads you down the path to failure.

Since I expect my readers, including you, are a smart and well educated group you have an additional problem. The smarter you are the more easily you can fool yourself. Think Jamie Dimon, CEO of JP Morgan Chase, ignoring all comments about risk as he allowed Ina Drew, his Chief Investment Officer, to make bets that lost over $2 billion.

Hopefully Dimon learned the Feynman lesson. On the other hand, Drew and several of her top people are gone while he survives. But that’s a different story for another post.

Who? Me?

We all are faced with a complex world, and the complexity is growing as we are inundated with information about everything going on everywhere. If you’re not careful you can get caught up in constantly changing everything without any thought to what is the core of your business. More information constantly attacking you does not make for good decisions…it just leads to chaos as you attempt to take it all in and adjust things minute to minute. Or second to second.

The most important word a good manager needs to learn to say is…no.  The most important task a good manager needs to learn is how to shut the door, put feet on desk, and think without interruption.

You need to have a clear business model, and follow it.  You need to have a distinctive culture, that all are passionate about. And most importantly you need to have the will power to stay away from the shiny stuff that glitters all around you trying to distract you from focusing on who you are and what you do.

This is not the same thing as becoming fixed in place, of becoming stuck on something while the world passes you by. Rather simplicity enables you to have the clarity of purpose and focus on excellence that enables you to continually improve and expand while staying true to your core business.  It gives you direction and allows you to cut through the siren call of complexity which only leads to increased cost and aggravation…and confusion for most.

In their new book Repeatability, Bain consultants Chris Zook and James Allen talk about simplicity.  For them the most successful companies share three traits:

• a highly distinctive core business
• a simple business model
• both followed relentlessly

Think Lego…global revenue US$3.945 billion in 2011. Profit US$776 million. And all they do is make little brightly colored plastic things that hurt your feet when you step on them while wandering around barefoot.

The exhibit is quite interesting and really stretches your thinking as you walk through the recesses of his mind. 

I like the ICA since it has no permanent exhibit but is a small space totally dedicated to a revolving series of shows by contemporary artists.  It is always mindbending to wander through. It often is uncomfortable. Sometimes it is entertaining, sometimes disgusting, sometimes humorous, but always thought provoking.

It is a great place to open your mind to new ideas and get yourself thinking in new ways about old things.

That title up there at the beginning of this missive was written on the wall as were a number of other thought provoking ideas.  I was particularly drawn to this one as it has so much relevance to management and leadership.  And it is so often forgotten or ignored by those aspiring to become leaders…or worse, by those pretending to be leaders.

All you do is noticed. Its impact is noticed. Your actions…and reactions are noticed. What you ignore is noticed and what you focus on is noticed. And what is noticed is remembered and affects those who notice.

And it does come back to you, positively and negatively.

What amazes me is how many in positions of leadership seem to ignore this truth. It all comes back to you. You really do need to think before acting.  Each and every action you take leaves ripples that follow you forever and guide the actions of others…and the way they think of you.

These ripples create the reality around you and this reality leads to your success…or failure.

It’s not about trying to look good. Or, as Sagmeister also says “trying to look good limits my life.” It’s about acting appropriately and never thinking it doesn’t matter what you do. It always matters.

People are watching. And their actions are guided by what they see. And if what they see is what you do…it always does come back to you.

Sagmeister

This is a word in all it’s meanings that you should know.  It is about making something as easy to understand as possible without leaving the opportunity for diverse and possibly contradictory ideas about what it means.  It is about ensuring that all understand something in the same way so they can move forward unified on what they’re doing. 

It’s about making it more difficult for misunderstanding and the resultant mistakes to occur. It’s about total and crystal clear clarity.

It is sadly lacking in normal discourse and even rarer in business and political talk.

Is it any wonder we have so many disastrous misunderstandings? Too many practice ambiguation rather than disambiguation. Too many are unwilling to express their ideas clearly lest others find out how shallow their ideas or ineffectual their thinking.  Others use ambiguation as a way to have it all ways.  After all, if you can’t understand what someone is talking about you can interpret it any way you like.  Unfortunately others will interpret it differently leading to all kinds of misunderstandings, actions at odds with each other, and, in the case of issues between countries, possibly war.

And then there is the war that occurs within an organization…all for the lack of clarity.

If memory can behave so poorly in such an important situation, how does it behave in less consequential settings?  And what is the effect on leadership and management of poor memory, or worse, memory rearranged by time.

Thus I was interested to discover that William Hirst of the New School and Elizabeth Phelps of New York University have been investigating the decay of memory.  To my dismay, they have discovered that a large percentage of remembered facts and details are self created.

The amazing thing is that they have discovered this is the natural process of the mind and memory, and not some intentional changing of history. It’s just the way your mind works.

It seems that the act of remembering itself leads to the memories changing.  As we remember we continually alter the facts without any conscious knowledge of these changes.  Memory is influenced by all kinds of things that subtly or not so subtly change the structure of events.

We all know that you get different responses depending on how you ask the question.  What we haven’t realized is that these different responses become the new memories, modifying and replacing what existed before.  To make it worse, the more we are asked to recall things the stronger these adjusted memories become and the more confidence we have in them.

The most useful thing to come of this research is that the more rapidly you respond to questions the closer to the actual memory you get.  Taking time to think and recall actually leads to more confabulation…as my father calls it. 

Confabulation: strongly believing that what you are saying is an accurate rendition of the facts of an event however far away from the real facts it might be.

We basically talk ourselves into firmly believing in memory that didn’t exist until we spoke it.  Once spoken, it becomes the real experience from that point forward.  Or at least until we modify it again based on some future misremembering.

The message? Beware of the stories people tell you describing experiences or events where there are serious consequences to the wrong information.  Take the time to research the facts in ways that are fixed rather than taking the rapid way of counting on someone’s memory.  Beware of guiding questions. When you notice that the facts change as the story gets told, don’t think you’re being misled intentionally but realize you merely are observing the vagaries of changing memory first hand.

As a big believer in story and its power to guide and influence I find this all a bit distressing.  On the other hand, I am reminded that I have said “never let the facts get in the way of a good story.”

Just remember, although there is a message hidden in that story somewhere…the story might or might not bear much resemblance to the actual event. Be sure you act accordingly.

Generally in this blog I share some of my thoughts on something I’ve noticed or been thinking about that I believe will lead to improving the skills of executives and managers.  After contemplating the words of Yau Luong Koh for several months, I’ve decided to share his thoughts with you.  Sometimes a young person just entering the world after college has wisdom well beyond their years, wisdom that their elders would do well to ponder.  Read and think hard on the words of Yau Luong Koh.

“When Kelvin asked me to do this speech, I refused initially. I wasn’t going to volunteer myself because I had nothing to say. But that same night, it suddenly struck me why I had said no. It wasn’t because I had nothing to say. I just didn’t dare to do something I wasn’t comfortable with.
 
 I had to give this a try. It’s why I’m here.  After all what’s the worst that could happen. I’m a student; we’re allowed to embarrass ourselves. 
 

And guess what? From that conversation with myself, I found something to talk about.  Getting out of your comfort zone, it’s the reason I’m standing here.

Getting out of your comfort zone. A very subjective phrase. What does it mean? Who started saying it? So like any good student, I used the most reliable method ever known to students.  I typed it into Google and Wikipedia.

Surprisingly, I didn’t get a satisfactory answer from the search result. But I did notice something; the Google images that popped up caught my eye. They were images of partying, bungee jumping, driving fast cars and people doing crazy things.

Now that got me thinking. Is that all there is to pushing your comfort zone?

I didn’t agree. So I came up with my own, basing it on my year here. It means to rebel. Our brain is hardwired to seek familiarity. Pushing your comfort zone means doing things that your brain wouldn’t want you to do. Rebel against your mind.

Rebel against yourself. That’s what it means. If you find yourself shy and hanging out with the same people all too often, Rebel, step out and make yourself some new friends. try talking to the person sitting next to you on the train to gain some courage. I’ve tried it. The networking events organized by SPIN, entrepreneurship talks by Rob Webber and Mentor gatherings are the first steps. But they are not enough. You need to really go out even farther and take your own initiative. There’s lots more out there.
 

If you find yourself bored and doing monotonous things over and over again at work or frustrated with school. Rebel. Not by doing something else, but by asking yourself what other ways can you approach the same problem. At school, try letting go of the obsession that you have been taught to place on academics and explore out of the classroom. You will find that there are so many things you never seen and want to learn about. A new way of thinking, a new skill, a new hobby and you will find that you are wiser than when you first came.
 

If you find yourself unsatisfied with the way that things are being done, challenge it, change things. Be the crazy one. It’s never easy to do this, but observe, listen and be patient. It can happen. I have seen it.

Because in the country we come from, a country of many boundaries, without such a mind-set all you can do is walk down the paths chosen for you, not by you. To the graduating batch, go back with this mind-set, don’t leave it here, don’t lose it back home either. This is not the end of your NOC (NUS Overseas Colleges). It has merely begun. All NOC does is loosen the knots tied up in your head. You have to be the one to untie them. Only then can you know how many more inches you actually have in you. Knot by knot, inch by inch. Those inches are going to add up and great things will come along.

Why am I talking about this? Because it’s important, it’s going to be what matters to you when you finally grow old. The people that I have met over this year have passed on that experience to me, to allow me to look beyond my years. With or without their presence today, I am grateful to them.  Thank you. Thank you for the inspiration each and every day.

Soon, we will have to return home. What’s left of our year here will be mere fragments of memories. The only evidence you will have of ever being in this country will be the mind-set, skills and lessons learnt here that will shape you as a person. You just don’t know it yet.

So to the graduating batch, please keep this in mind. Untie the knots, one at a time, because inch by inch, you can create miracles.”

Leave your comfort zone. Untie your knots, one at a time. Who knows what miracles you will create.

Nuclear power might be one of the places where complacency and lack of imagination can have the most dire consequences, think Fukashima, but it leads to problems and poor results in all kinds of places. Again and again we hear about disasters big and small that came about because “we didn’t think that could happen”, or “we never thought about it.”

Not thinking is not a good plan for avoiding disaster.

But it’s not only thinking that is required, but creative thinking, imaginative thinking, thinking about the unthinkable. Unfortunately such thinking is the opposite of what most of us do. We are stuck in our rut due to lack of variety. Our brains become rigid, our viewpoint narrowed by blinders or regularity, our universe shrunk to the same circle of people with the same ideas.

Our brains become tired.

Wake up your brain and those of your people.  It’s both harder and easier than you might believe. 

Harder since you need to change your behavior. Variety of experience leads to expansion of ideas. Venturing beyond your area of expertise and searching out those with divergent expertise leads to new ideas. Travel really does broaden the mind as does looking at things that you just don’t fully understand.  Maintain the perspective of the outsider.

Easier since all you need to do is to do something different, often. Vary the restaurants you visit.  for each vacation, visit a different place.  Regularly go places you never thought you’d go in a million years. And let your brain rest by doing frivolous things. Your subconscious mind works at its creative and imaginative best when you let it relax.

When was the last time you spent an hour playing pinball?

Ever been in an Apple store? It’s filled with energetic, helpful, knowledgeable people…both the employees and the customers.  And it’s filled with products selling at full price.  Each and every one of the customers can get exactly the same products for less money at Walmart, Target, or even without the addition of sales tax through Amazon.  And yet they flock to the Apple store and leave not only with something in their hands but with stories of joy they share with everyone they know.

It’s the experince they seek as well as the products.

It’s hard to understand why so many companies don’t seem to get this, especially today when they are confronted with the internet taking so much business away from their stores. Relationships and connection are built by excited and engaged employees working in a stimulating environment for a company that really believes each and every employee is a full time ambassador.

This organization doesn’t just pop into existance or develop from training and financial incentives. It comes about when the leaders show the way by exhibiting the same behavior they expect in others.  It’s a hard thing to do for most managers.  It means trusting your employees, giving them freedom to act, accepting that they will question everything and expect you to be comfortable being asked these questions.  It means being open and honest in all communications and always, always, always walking the talk.  And it mean having full accountability so each and every person knows exactly what’s expected and how to measure it…and then leaving them alone to make it happen.

It’s not the way most managers are brought up.  It’s not comfortable for most managers. It scares most managers.

It loosens control while expecting self motivation and trust to replace it.

And you have to keep it up all the time for there is no such thing as turning such a culture on and off depending on your mood of the day.

Then there is the horrible fact that it is requires constant change and evolution to keep it fresh and engaging so the emotional connection remains strong.

Now that I’ve written this, I take back my comment up there about not understanding ”why so many companies don’t seem to get this”.  It’s not that they don’t get it, it’s that it scares them to death.  Loss of control, employees wandering around doing and saying who knows what, fear that they’ll be shown unable to answer the questions and show the way.  Constant change.

Yet this is the world we face.  Successful companies are going to embrace a culture of engagement and empowerment of employees.  They are going to bring on board managers and executives who believe in operating a business that truly believes in people and creating an exceptional environment for them to thrive, be they employees or customers. 

Prepare yourself for the future, for the future is here.  Who knows, in addition to developing a more successful company you might just become one of those Favorite Places To Work.  From a purely financial perspective…after all, we are talking about business…Favorite Places To Work tend to be among the most profitable companies.

Now that’s something that ought to get you working to develop a culture of engaged experience and emotional attachment.

Later I learned that, in fact, you sometimes can’t tell the front from the back!

In this week’s Economist there is a letter from Harold Fuller, Volunteer, Colorado Railroad Museum, presumably someone with an big interest in and significant knowledge about trains.  He mentions that there are many trains these days where “the front and rear ends are identical. Traditional signals for moving the train, either by hand or by radio, are ‘Go forward’ or ‘Go backword’, relative to the locomotive. Thus, everyone involved must have a common understanding of a train’s front and back.”

I was amazed when I read this. Once the F is explained it makes perfect sense as a safety feature keeping some hapless train worker from getting flattened. To those in the know, a necessary marking. To those unfamiliar with trains, a ridiculous and unnecessary regulatory overreach.

Since reading Fuller’s letter I have been looking at things I previously thought as ridiculous as the F and trying to figure out if they also serve a valuable purpose, or served one in the past.  It’s an interesting exercise involving the willingness to set aside established ideas and beliefs while engaging in creative thought about simple things. So far I haven’t come up with anything as interesting as the F but have realized that there are quite a few things that upon intense thought turn out to have much greater depth than I previously realized.

The way I direct my attention has shifted leading to seeing things from a different perspective. Tomorrow I’m off to Botswana for a few days where I hope to use this new perspective to re-evaluate my ideas about the country.  And when I return, who knows what I’ll discover hidden among the common things I thought I knew so well.

Discovery starts with the willingess to search.  Hopefully some enlightenment follows, or at least a few new ideas that will lead who knows where.

Of course, there are things that no matter how much you contemplate them still seem ridiculous.

My last note to you, Loosen Up, was about the way giving some control and autonomy over the way things are done leads to better results. Airline travel today, most especially in the United States, is an exercise in showing how lack of any autonomy leads to the exact opposite…and with a huge amount of wasted effort and expense not to mention angry citizens who all recognize the stupidity of forcing pat-downs of young children because their number happened to randomly pop up.

Planning for the trip got me thinking about how control so often has the effect of adding complexity.  And complexity so often leads to loopholes that lead to results far different from those envisioned.  Our legislative process here in the US is probably the best example of this.  Do they actually think a 2800 page law does anything but lead to myriad ways to evade its intent for those clever enough, while penalizing those with less resources…or fewer attorneys.

I see companies every day that have forgotten this.  They worship complexity…at least until I get them thinking about the virtues of simplicity. In spite of what legislators and so many executives think, you can’t control everything.  You can’t plan in great detail for everything that might occur.  The world is often random and no matter how you plan or draft volumes of rules and regualtions, it throws something at you, you never thought of.

Find the right people, people who believe in what you do and have the right skills.  Give them the broad goals and prescribe only as much as is required for consistency and quality.  Give them the right tools and training. Allow them to fill in the rest. Allow them to think. Give up some control and complexity in favor of simplicity and autonomy…and watch results improve.

Keep it simple.  Stop traumatizing the children…and the rest of us.