Have
you wonder why smart people sometimes make mistakes that seem like good ideas
at the time. Why do clearly intelligent people, including business leaders,
make spectacularly wrong decisions costing them time, money, and at worst, the
loyalty of their customers and employees? Yes, sometimes apparently intelligent
individuals, even geniuses, do things that look exactly like stupidity. That is
thrust of this piece.
If
we look around us, we can find all kinds of examples of things that smart
people got wrong. In hindsight, some of them seem so simple. We look at them
and say, “How could a smart guy like him do something so stupid?” “How could
this intelligent lady end up marrying a fool like that?”
Let’s
look at football team for instance, the Arsenal FC was founded in 1886 by a
group of workers employed by the Dial Square workshop at the Royal Arsenal, an
armaments factory in Woolwich, Kent (formally part of the new County of London
from 1889). They were led by a Scotsman, David Danskin, who purchased the
club's first football, and Jack Humble. Arsenal has had a total of 26 managers
from inception until this moment, Arsène Wenger being the long serving manager
since 1st Oct., 1996. To his records are: Premier League champions:
1997–98, 2001–02, 2003–04, FA Cup winners: 1997–98, 2001–02, 2002–03, 2004–05,
2013–14, 2014–15, Charity/Community Shield winners: 1998, 1999, 2002, 2004,
2014, 2015
Before
the French man took over from the Irish - Pat Rice who was among the four
previous managers Arsenal had without a single trophy from Feb 1995 – 1996, he
had a successful managerial records with Monaco FC.
Chelsea
FC on the other hand has had 38 managers from inception in 1905 till date, José
Mourinho being the most exceptional manager with spectacular records: 2005
Football League Cup, 2005 Premier League, 2005 FA Community Shield, 2006
Premier League, 2007 Football League Cup, 2007 FA Cup, 2015 Football League Cup,
2015 Premier League. Even though Roberto Di Matteo made history in 2012 by
leading the team to win their first ever UEFA Champions League, Mourinho still
remains the finest and most celebrated manager of Chelsea FC.
Looking
at the results and achievements of these two coaches Arsene Wenger and Jose
Mourinho you will agree with me that they are both smart and good at their job.
Even though Arsenal fans will totally agree giving the current form and
direction of the club. Mourinho of course had his worst career record too at
Chelsea 2015-2016 before being shown the exit-door by the Russian billionaire -
Roman Abramovich.
In
a nutshell, both managers despite their fantastic results have failed in their
realms and fall short of expectations. Why these things happen, and why they
have to happen, at least until we understand their causes is the major thrust
of this piece. All the errors presented in this piece were cause by ways of
thinking that are not stupid; indeed, we need them in order to live. But like
many good things, too much of them can be harmful.
Like
the two examples given above, there are trade-offs in ways of thinking, just
like in anything else we do in life. If I buy a car that is big and comfortable
(eg. Jeep), I have to spend more on fuel at N145 per litter and still rising; but
if I buy a small, fuel-efficient car (eg. Golf), I lose in luxury.
The
same trade-offs apply to the ways we think. For example, if we are wired to
safe cost and deliver good results at minimal investment cost. It will affect
our predisposition and choice of tools and resources to get the job done thus
even if we were given a pot full of money at our disposal just to get the best
tools for our job, we would still not want to get expensive tools which are
most likely the best. We would rather pick solace in criticizing others who
splash lots of money acquiring the best resources to deliver best result. That
informs the Newspaper’s headlines such as “Arsene Wenger describes Paul Pogba's
£100million transfer fee as complete madness” – (UK Mirror, 31st
July, 2016). “Arsenal transfer news: Arsene Wenger attacks Paul Pogba move and
admits need for new defender and striker”- UK Independent, 31st
July, 2016).
Every
error in life is as a result of the kind of trade-offs; each one is an example
of behaviors we need but that sometimes leads us to error. Time will tell if
Pogba’s move was complete madness or not, that same time is all Wenger
needed to have used to acquire what he needs to start churning out result
instead of critiquing others and waiting until the market is about to close. Perhaps
it was a strategic move to wait until when all buyers are out of the market so
he could pick the remnants at cheap costs. Just my opinion though, I have high
respect for the Sexagenarian but it sometimes baffles me how a smart man like
him make stupid decisions.
As
my career progresses in the field of Project management and IT consulting, I
began to work with more senior professionals who had dedicated the best part of
their career to the field, I noticed that the business world did not really
have a handle on why people make mistakes in judgment and provided very little
training in how to avoid them.
As
I continued to look at this problem, a few things became clear to me. These are
the points I will like to discuss:
·
The
thought patterns that make smart people do stupid things are rooted in our own
evolution and development. These thought patterns are not evil or stupid – they
are just inappropriate.
·
The
mistakes that Football club managers, government leaders, and business managers
make, those that look like subtle misjudgments, are driven by the same thought
patterns as those made by the most ridiculously stupid of our fellows.
·
Intelligence does not prevent these mistakes,
at least not perfectly. Indeed, being smart actually seems to make you more
susceptible to certain types of error.
Jim
Nightingale in his book “Think Smart, Act Smart” buttress this when he divided
these mistakes into four major groups according to the underlying Psychological
forces behind them:
1.
Wishful thinking: Strong desire makes it
difficult for us to think clearly and realistically. Eg: “I can’t work under
anyone, I want to own my business and be my own boss”
2. Mythical
Thinking: We
are unable to free ourselves from powerfully held beliefs that explain the
world for us and to which we have made strong commitments, or are unable to
discard an approach that has been successful for us in the past. For example,
to be successful, you must be educated!
3. Tribal
Thinking:
Social concerns keep us from reaching correct conclusion. Eg: “He is an Igbo
guy, they are very industrious let’s employ him”.
4.
Royal Thinking: Issues of power and hierarchy
keep us from making good decisions. Eg: “Am too big for those small businesses,
leave them for the boys, let’s chase the big fish”.
The
first two groups contain things that happen to individuals; the last two apply
mostly to group situations, where several people are involved in the thinking
process. Some of the tips below will be useful in avoiding the business
mistakes that even intelligent people make:
1.
Never make decisions
unconsciously:
Most decisions are made by leaders/managers unconsciously because of the
enormous pressure on them. Avoid rash decision, mull over every decision
especially in formal decision-making processes. A simple decision can cost your
business huge loss.
2. View
the world through the right lens:
That is, give the appropriate weight to the right things. If the challenge
facing the organization is quality, then getting more people to get the job
done isn’t the solution but the right people.
3. Set
the right Goals:
Among the most common decision pathologies in organizations are unclear goals.
I once worked with the executive team of a newspaper company that provided a
good illustration of this problem. Ensure that the goal is clear with you
before bring on board other resources to drive them with you. As a matter of
fact, the type of goals you set to achieve determine the kinds of resources you
will employ to chase them. If 4th -5th place in the
league is what the goal of the management is, then even if your team has the
opportunity to grab the first place, psychologically they will be dragged down
to give it up for 5th place.
4. Get
the right people: Just
as explained earlier, the right goal begets the right people, the right people
begets the right result.
5. Get
the Right Process:
It may sound strange to talk about this as a Nigerian, but the fact remains
setting up the processes for an action or decision stand you out. People with
the right process get things done faster and better than their counterparts.
I
agree with Nightingale’s six rules of decision making to avoid errors in judgement.
1.
Look
for disconfirming evidence: Probably, the single most important thing decision
makers can do is look for evidence that tells them they are wrong.
2. Do your homework
3. Stepping outside of the
problem to think
4. Review your decisions and see
what worked and did not
5. Create a strong group of thinking
partners/friends/associates
6.
Know
your limits and beware of success: Sound strange? Successful people are used to
being right, and sometimes this can lead them to assume that they have grasped
and understood a problem.
In
the spirit of full disclosure, I claim no immunity from these mistakes myself
and have fallen prey to each of them at one time or another (many times
actually). My aim is to point out some of these errors and recommend solutions
that has worked for me and still working, I believe they will be useful in your
decision making too especially judgment that affects others.
I
wish you the best in your endeavor.
