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Wednesday, November 20, 2013

Every Leader Needs a Challenger in Chief 11-20

Every Leader Needs a Challenger in Chief

We are drawn to those who echo what it is we already believe. We get a dopamine rush when we are presented with confirming data   similar to what we get when we eat chocolate or fall in love. On Facebook we defriend those with different political views to our own  . On Twitter we follow people just like us.
Yet a vast body of research now points to the import of contemplating diverse, dissenting views. Not just in terms of making us more rounded individuals but in terms of making us smarter decision-makers.
Dissent, it turns out, has a significant value.
When group members are actively encouraged to openly express divergent opinions they not only share more information, they consider it more systematically and in a more balanced and less biased way. When people engage with those with different opinions and views from their own they become much more capable of properly interrogating critical assumptions and identifying creative alternatives. 
Studies comparing the problem-solving abilities of groups in which dissenting views are voiced with groups in which they are not find that dissent tends to be a better precondition   for reaching the right solution than consensus.
Yet how many leaders actively seek out and encourage views alien and at odds to their own?
All too few.
President Lyndon Johnson notoriously discouraged dissent, with many historians now believing that this played a significant role   in the decision to escalate U.S. military operations in Vietnam.
 Excessive group-think is now recognized to have underpinned   President Kennedy’s disastrous authorization of a CIA-backed landing at Cuba’s Bay of Pigs. Former employees of the now defunct Lehman Brothers have talked about how voicing dissent there was considered a career-breaker  
Yale economics professor Robert Shiller explained   that when it came to warning about the bubbles he believed were developing in the stock and housing markets just before the financial crisis he did so only “quietly” because: “Deviating too far from consensus leaves one feeling potentially ostracized from the group with the risk that one may be terminated.”
Is this the feeling the “clubby” environment in your boardroom is inadvertently engendering?
 Or are you actively signaling that you want to hear views different and diverse and in opposition to your own? We need to have the confidence to allow our own ideas and positions to be challenged.
Eric Schmidt, the Executive Chairman of Google, has talked about how he actively seeks out   in meetings people with a dissenting opinion. Abraham Lincoln’s renowned “team of rivals  ” was comprised of people whose intellect he respected and were confident enough to take issue with him when they disagreed with his point of view. 
Stuart Roden, Co Fund Manager of Lansdowne Partners’ flagship fund, one of the world’s largest hedge funds, tells me he sees one of his primary roles as being the person who challenges his staff to consider how they could be wrong, and then assess how this might impact on their decision-making.
Who in your organization serves as your Challenger in Chief? 
Interrogating the choices you are considering making? Making you consider the uncontemplated, the unimaginable and that which contradicts or refutes your position?
And also challenging you?
For we are not the robotic emotionless decision-makers of economics text books, bound to make the rationally best choices. Instead we’re prone to a whole host of thinking errors and traps.
Did you know that when we’re given information that is better than we expected — i.e. that our chance of being targeted for burglary is actually only 10% when we thought it was 20% — we revise our beliefs accordingly. 
Whereas if it’s worse — i.e. if we’re told that rather than having a 10% chance of developing cancer, we actually have a 30% chance — we tend to ignore this new information  ?
Are you aware of the extent to which our emotions or moods can skew our choices? 
You may already know that stress leads to excessive tunnel vision, but did you know that studies of both judges and doctors reveal that when stressed they typically revert   to their unconscious racial stereotyping biases? 
Or that if we go 24 hours without sleep or spend a week sleeping only four or five hours a night, our thinking is as compromised as if we were drunk  
Whilst studies in which people are presented with financial choices reveal that people make worse decisions when their blood sugar has dipped, but also when they’re feeling hot under the collar. Male students presented with a financial decision after having been shown either a “neutral” image such as a rock or a “hot” image of a lingerie clad Victoria’s Secret model, made significantly poorer choices after having looked at the “hot” image  .
And how about our propensity to become overly attached to the past?
You remember how huge Nokia was. From the 1990s onwards, Nokia dominated the mobile phone industry. At its peak the company had a market value of $303 billion and by 2007 around four in 10 handsets bought worldwide were made by Nokia.
But when Apple introduced its game changing iPhone in 2007, Nokia was caught sleeping on the job. Despite having themselves developed an iPhone-style device — complete with a colour touchscreen, maps, online shopping, the lot — some seven years earlier. They never released the product. Instead they decided better to stick with what they knew worked — good, solid, reliable mobile phones.
 As a former employee working in the development team at the time said of that decision  , “Management did the usual. They killed it!” When the iPhone was introduced, Nokia engineers sneered at the Apple devices’ inability   to pass their “drop test” in which a phone was dropped onto concrete from a five-foot height.
Nokia management believed that their successful past would continue to provide a reliable guide to the future, but as we now know it didn’t. In the six years since the iPhone was introduced Nokia lost about 90% of its market value. And when Microsoft bought Nokia’s phone business this month, the fire sale price it paid for it, only half what Google paid for Motorola last year, firmly reflected just how far it had fallen.
Your Challenger in Chief needs to be alerting you to such thinking errors and foibles. And you need to be listening to him or her.

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