What Everybody Knows is Mostly Wrong

The reality of this statement can be seen, observed andproven all around us.

What everybody knows is mostly wrong because people makeone or more erroneous assumption and then like a herd everyone buys in withoutquestioning the assumption.

Take one look at the current airline crisis – the JetAirways Pilot strike and it becomes clear.

All the other airlines are collectively, wholly andastoundingly acting stupid. Jet is virtually shut down for lets say five daysor so. Here is an opportunity for other airlines – What do the smart brains whoquickly huddle into the boardroom on hearing the news do? They identify anopportunity, discuss and arrive at a decision that at this struggling time,here is an opportunity to capture some 15cr of revenue – not just that – alsohike prices and make the best of these five days – its festive season, why not?

Can you see the shortsightedness? In reality here is an opportunityto acquire market share. Thousands of Jet customers are troubled. Not oneairline thought about the ‘basic fact’ on which their entire business dependsupon – the customer. Not one airline thought that lets think in the interest ofthe customer.

The real opportunity is in acquiring the loyal Jetcustomers who are now frustrated and disgusted with the whole think. Imaginethe impact that could have been made if someone though clearly and challengedthe assumption to make a quick buck. Imagine if one of the airlines (say aKingfisher or Air India) was to release a simple two line message like – “Weunderstand your frustration. We respect you and want to extend you, your rightto travel with ease. We offer you unconditionally ‘the same’ membership statusthat you enjoy with Jet. We want to serve you long term. We are not raisingprices like other disrespectful airlines. We respect you and furthermore if youshift your membership to us, we are reducing the fares by 5% till the pilotstrike is called off.”

Don’t you think that they would have at least acquired a5% shift in share for a long term and gained instant reputation as acustomer-focused airline. Their managements certainly didn’t think so, butthen, what many people know is mostly wrong!!

The Tylenol Case

Back in 1982 someone laced a popular over-the-counter drugwith Cyanide. A few who bought the drug died. There was an instant nationalpanic in USA. So much so that people who had taken the drug in last month evenstarted suspecting that they had been poisoned. There was complete chaos andhysteria.  The newspapers did theirjob in fuelling it further. Tylenol was overnight now synonymous with poison.

At the time this was a thirty year old brand. The brandowner Johnson and Johnson launched a recall and stopped all sales. Virtuallyeveryone they consulted with or hired predicted the demise of the brand. Onewell known advertising guru wrote in The New York Times, “I don’t think they can eversell another product under that name. There may be an advertising person whothinks he can solve the crisis and if they find him, I want to hire him to turnour water cooler into a wine cooler.”

The  WallStreet Journal commented that the product was DEAD, any other notion was anexecutives pipedream. A survey of “the man on the street” found that not oneperson would buy the product regardless of what the company did to guaranteesafety.

Despite what everyone knew, Johnson & Johnson retainedthe product Tylenol and now its very famous brand name. They didn’t heed in toany suggestions of experts of launching it under a different name. Theylaunched one of the most effective public relations campaigns. Sales began toclimb after a few months and before a year Tylenol captured its position backof 35% market share as number one analgesic in a two billion dollar market.

The case is studied in business schools for an example ofan excellent public relation campaign. However the basis for all of this isthat the executives at Johnson & Johnson, knowingly or not decided that“What everyone knows is mostly wrong.”

Examine how decisions are made in your board room. Someonethinks of an idea. Places a suggestion. The CEO seconds it. So one or two moredo. The one odd person who has a counter probably gives-in to the majority inno time. The majority wins by consensus. What everybody thought getsimplemented with complete harmony and agreement. Collective dumbness like atarget of some millions in an pilot strike crises prevails!!

The process is no different in families, in decisionstherein. Think back… think the key decisions… Think, reflect, see, REALIZE….

You can almost take it as a thumb-rule that if withoutdisagreements, you or your team or your family is reaching a consensus -  you are about to take a stupiddecision.

Another example of this is the Peter Principle. In 1968Dr. Lawrence J. Peter, a professor at University of California, wrote abestseller called ‘Peter Principle’.. The concept is “In a hierarchy everyemployee tends to rise to his level of incompetence.” Thus being incompetentthey would be promoted no further in terms of job responsibility. Basically asit exists in most organizations, an employee joins and then gets promoted andgoes on in that manner till he reaches his level of incompetence, beyond whichhe can’t be promoted further. Obviously it almost impossible to return theemployee to his previous position. Thus Peter’s thesis concluded that thedanger is that many organizations have their top managements filled with peoplewho are there because they were good in previous positions but incompetent forthe current one. The suggestion Dr. Peter gave was that since one cannot demotethem, one has to research if this was true in your organization – if so, takecorrective action by may be getting rid of them. It found and to this day findsresonance with many organizations. The consulting companies would even carryout a detailed statistical Peter analysis if you wish and prove it.

I cannot tell how disgusted I was to read this book. Itsappalling. Its almost unbelievable to me that people actually implement this.The concept has many downsides. Number on that the solution to ‘incompetence’is dismissal. Even before that what concerns me most is the assumption thatfailure is due to incompetence.

There is a true story that Thomas Watson, founder of IBMonce asked to see a newly promoted vice-president who failed in his firstassignment and cost the company a million dollars. The young man reported tothe chief ready for the worst. “I guess you called me in to fire me,” he saidon entering Watson’s office.

“Fire you!” Watson said, “We just spent one milliondollars as a part of your education.”

Organizations that knowingly or unknowingly apply PeterPrinciple and I know many who do, puts it’s manager into a unconscious processof ‘zero failure’. No mistakes might happen and neither might development.  The Peter principle doesn’t even leaveroom for hope. Imbibed in this theory is an assumption that if a manger isincompetent for one job, he or she wouldn’t function better in another. Itassumes a person cannot rebound. Both assumptions are an error and yet furtherproof that ‘What many people know is mostly wrong’

A man who didn’t believe in Peter: Winston Churchillreached his level of incompetence as First Lord of the Admiralty during WorldWar I, during which he convinced the British Cabinet to undertake the biggestAllied disaster resulting in the worst Allied defeat with 200,000 casualtiesand followed by his forced resignation from the job. Yet, the same man withmuch higher responsibilities as the Prime Minister during World War II savedEngland and possibly the world when for a year the British stood alone againstHitler. This “incompetent” is considered the greatest British political figureof the 20^th century.

One can go on about these examples and cases, they areeverywhere. However, please look in to the past, present and future,professionally and personally – What things have you done, or continue to dobecause everyone thinks that it was the right thing to do? In hindsight is itreally right? If not, how will you abandon it?

We are all in the business of either being part of orcreating organizations. Our collective thoughts, actions and decisionsdetermine the character or our organizations.

Does this organization exist?

Can you think of an organization which has ALL of thefollowing characters.

-      Theworkers work very hard physically, including weekends if needed, with nocomplaint.

-      Theworkers are happy with whatever compensation they get for the job. The jobitself is a compensation for most.

-      Thework is dangerous and workers are frequently injured on the job.

-      Theworkers usually have a very high morale.

-      Theorganization always has more workers than can be employed.

-      Theworkers are highly motivated to achieve organization’s goals.

Can you think of the answer? Not many can. It’s your highschool football team? Yes it is.

You might say, “hey that’s not work, football is play.”Exactly right. That’s part of the secret to engaging workers, you need toconvert work into a volunteering game.

The point am trying to make is this – High School FootballTeam knows how to unite people into a dream. Everyone becomes part and everyonebecomes glorified if the dream were to come true. They all will share thesuccess almost equally. They will all have opportunities in success. The highschool soccer team also runs within a budget and time constraint. They toooperate with infighting, jealousies and bickering. They probably face moredisappointments and fiercer competition. However the high school team managesan organization described above!!! They do it because the Students yet, DON’TKNOW WHAT EVERYBODY KNOWS. They haven’t been to management schools or exposedto ‘our’ concepts of an organization.

All of us have in some form been a part of such anorganization in school, whether sports or otherwise. We ran it very well withgreat passion. Unfortunately, then, over time, we started believing in whateverybody knows. We co-create organizations, cultures, families, societies,countries – no matter which family, company, society you investigate – we findsame kind of people issues, management issues, leadership issues, market issues– Why? Obviously because we start to operate in a framework that is generallyperceived to be right by all.

But how many organizations live to see the future theyhoped for? Not that organization created in this manner aren’t successful, theyare. Though the concept of success and it’s definition again is something thateverybody thinks it should be. How then will we ever see what truly the highestlevel of success, a breakthrough could be?

What Everybody Knows is Mostly Wrong, be it the perception of whatsuccess is or the process to get there. It’s a safe way to operate though andwhy not? It would seem stupid to question collective wisdom, even though beinga part of that greater stupidity is not considered stupid. Again that’s whateverybody knows…..

However, eventually, collective wisdom will only lead todestruction. Examine the history, the organization, societies, countries,cultures destroyed. Examine the present and look into the future, wecollectively with all our wisdom coming together will repeat the history!!!

yours,

Chetan Walia