I’ve spoken many times about the psychology that explains business leaders who watch their organisations crash and burn. On the surface it makes no sense. These people are smart enough to have run successful businesses, usually for many years and have often even founded them, but, all of a sudden they seem unable to keep them going. They can’t be stupid, although there is a tendency among a few smart-arsed business consultants to dismiss them as such, yet the decisions they make are often just wrong. Is this the “brain-barrier” at play?
Doing things “less badly” doesn’t cut it anymore
Let’s put this in context. The probability is that a decade ago the decisions that these executives are making today would have been OK. However, things change. In the digital age the bar is higher, the pace of change faster and the margin for error barely perceivable and now Covid has kicked business into a whole new gear. If you weren’t adapting to the new momentum before the pandemic, it’s unlikely you’ll be able to keep up now. That’s why we have seen so many business failures recently.
It’s important also to note that although decisions made and processes applied in the past may have delivered success for those concerned, this doesn’t mean the companies were doing as well as they could have. Success is usually comparative. You just have to be doing things “less badly” than your competitors. Resources or knowledge have always imposed compromises, but when that’s happening all around we don’t always recognise them as such.
How we’ve grown accustomed to compromise
For example, products that we’ve created and happily purchased in the past, rather than the real deal, were the closest we could get, with the resources available, to what was actually needed. These products and services sold and were often popular, but only because competing suppliers were all in the same boat, working with the same resources and within the same limitations. Customers were left to choose the product that came closest to what they really needed.
All that has changed of course. Organisations that have embraced today’s technology are able to deliver pretty much the perfect response to anyone’s need. Now it’s a question of who is able to combine tech and smarts most efficiently.
It’s important we recognise the extent of the changes digital technology has brought to business in what is a highly compressed time-scale. Since the beginning of time we have been taught answers to questions that we have repeatedly encountered and we’ve progressed by cutting and pasting formulaic solutions to a standard problems. Unfortunately this approach doesn’t work anymore.
Why there’s no end in sight
The reason is that technology is changing the landscape against which our lives are playing out so much faster than ever before and every problem is unique. Those of my age will remember when children would aspire to the wardrobe of their parents. Then came the sixties “revolution” and self-expression, which made such a thought abhorrent. It took generations for this change to take place, but a child today will think even their older siblings out of touch and old-fashioned.
It’s Moors Law if you like and, although some people will tell you it can’t go on like this, there’s still no end in sight. We already have super computers that will “think” faster than the human brain and we haven’t yet scratched the surface of nano and neuromorphic technology or quantum computing.
Businesses must respond to and even pre-empt demand. When the pace of life is as relaxed as it has been in the past that’s do-able for most businesses. However, it’s unrealistic for us to expect to work this way when we are travelling at today’s pace. Luckily technology has come to the rescue.
Today’s digital technology, even in its simplest form, enables us to do far more in less time. So, tasks like sifting through data that we would, in the past, have decided was impractical, become a breeze. Any business these days can follow the decisions and responses of their customers in almost real time and those with even modest tech can predict decisions that haven’t been made yet and get it right most of the time.
So, against that back-drop, what is it that causes business leaders to refuse to jump on board even when this means resisting changes essential to their survival?
What the doctor says
Tara Halliday is an author and PhD who works with senior executives who are holding themselves back from even greater achievements because they’re operating from an unconscious, false belief about themselves. The popular term for this these days is “imposter syndrome”.
Tara mentioned to me during a recent conversation that 20% of the calories our bodies burn are consumed by your brain. Now that might sound like a basis for a pub quiz question, but it struck me as having broader significance. It may be the key to Tara’s clients’ problem, but I like it because it could also explain why otherwise smart business executives resist business transformation.
I’m going to pass on the opportunity to explore the delightful possibility that if brains burn so many calories we could all lose weight by thinking more. Instead I’ll get to the more important aspect of this nugget.
Sometimes your brain is too smart
Apart from being a big consumer of energy your brain has the ability to recognise this weakness and takes steps to compensate. What this means is it puts the thinking process on automatic by creating beliefs and assumptions.
Your brain knows it’s made it through life so far doing what it does, so when you try to encourage it to ponder on issues it feels it has already resolved it does just what you would expect. It puts it all on the back burner and concentrates on things it doesn’t believe it’s already nailed.
I’ve lost track of the number of times a senior executive, when confronted with the challenge of business transformation, has told me “I don’t need all this”. According to Tara this is the scenario I just explained playing out.
The thing is, we all know that these executives do need it if they and/or their businesses are going to survive in the new business era. It’s just that their brain is hard-wired to make assumptions using the data it already has, rather than expend more energy finding new data. Invariably, though, the stuff they do have is out of date. The thought process goes something like this — I am alive > I am not experiencing problems right now > therefore the stuff I am doing is working > I don’t need to do anything more right now.
Why change and transformation are not synonymous
We also need to remember that business transformation isn’t the same as change. While change is the process of automating existing business models, business transformation is ripping it all down and starting again on new foundations. Transformation is radical, a big deal, lot’s of work. Change is the reluctant executive’s “happy place”. When the world is pushing them to transform, implementing change makes them feel they are achieving something. Sadly this is delusional.
George Westerman the MITSloan man is noted for explaining change as being a fast caterpillar and transformation a butterfly. It’s easy to fool yourself into thinking that the fast caterpillar is all you need to succeed in the digital economy. Change will usually deliver short-term improvements because it gives you a modicum of accelleration. However, the problem isn’t just about how fast you are moving, but the direction you are moving in. The usual outcome of this approach is that you find yourself very efficiently making stuff that nobody wants. Unfortunately, that’s the journey your brain is programmed to take you on.
So, if your brain is hard-wired this way, what can you do? Luckily, your brain can also learn from experience and it will use those experiences to draw new conclusions and change the way it operates.
How you re-train your brain
The work of people like Tara involves helping senior executives recognise the sub-conscious belief that is the real driver behind their behaviour and then change that belief. When this underlying belief changes, all the behaviours that are holding them back and causing self-doubt fall away. They then naturally approach their work from a different viewpoint, free from stress, worry and distraction.
In fact, that’s what I do with businesses and I’ll often call on experts like Tara to work with my clients to address their imposter syndrome issues before they become comfortable with what they have to do with their business.
My task is to re-educate your collective executive brain! This means going back to basics and leading my subjects through a logical progression whereby it’s impossible to avoid the conclusion that transformation has to happen and what that means.
The starting point revolves around two of the twelve essential coordinates of the Brand Models I create for my clients — Purpose and Promise. In other words, why your business exists and what that means to your stakeholders, among them your customers. This may sound straightforward, but it’s rarely an easy matter to drill down to the bedrock of your business and you’ll need external help if you want to get it right.
Nevertheless, this often provides a big enough jolt to get your process moving and you can move on to confront the next reality. How far you are away from measuring up and how much closer other businesses may be.
Further exercises like this, conducted around different aspects of your business, will combine to provide you with a clear picture of where you are today relative to the opportunities within the market. Then you can set about designing the programmes that will fill the gaps in your resources and set you off in the right direction.
Your options become more obvious and increasingly focussed the further you progress until there’s no escaping reality and your brain decides it’s in its interests to open up.
Gaining instant improvement
I find my Brand Discovery workshops are the key to unlocking the potential businesses have to bring about their own salvation. I’ve watched as things start to click into place for participants during these sessions and many businesses have demonstrated immediate improvement as a result of this initial process.
It is often said that the key to business success is innovation and it’s an area where the benefits of this approach are often most obvious. Everyone has ideas. They may often seem small, but I’ve seen an off-hand comment made by a junior employee turn into an independent business unit for one of my clients.
The problem is we rarely give enough time to thinking about them, because our brain deems it an unnecessary use of energy. Often I hear employees with good ideas that have sat on them for years because senior executives had persuaded them — often unintentionally — they were valueless. This has conditioned the employee’s brain to file away all ideas like this, in the drawer market “no point”.
Well there is a point. In fact in the digital age fresh thinking and new ideas are the only thing that will keep businesses in business. We all need to break through the brain barrier and this is how you can do it.
Phil Darby
June 7, 2021