Complexity is the defining business and leadership challenge of our time. But it has never felt more urgent than this moment, with the coronavirus upending life and business as we know it. For the next few weeks, we’ll be talking to leaders about what it takes to lead through the most complex and confounding problems related to the coronavirus.
Today we talk with Roger L. Martin, Thinkers50’s 2017 #1 management thinker. Roger is a trusted strategy advisor to the CEOs of companies worldwide including Procter & Gamble, Lego and Ford, and a Professor Emeritus at the Rotman School of Management at University of Toronto. His upcoming book is WHEN MORE IS NOT BETTER: Overcoming America’s Obsession with Economic Efficiency (September 2020). His previous eleven books include Creating Great Choices, Getting Beyond Better, and Playing to Win, which won Thinkers50’s Best Book of 2012-13. He has written 28 Harvard Business Review articles on subjects that include democratic capitalism, strategy, design, integrative thinking, and social innovation.
David and David: What problems/vulnerabilities has the pandemic exposed?
Roger: Even before the pandemic, I was already talking and writing about how we’ve erred economically toward an excess of efficiency and a deficit of resilience - that’s the topic of my upcoming book, out this fall. As I explored in a recent op-ed for The Washington Post, Covid-19 came along and demonstrated the ways in which we’ve sacrificed resilience and undermined our capacity to deal with such a catastrophic event. Taking millions of dollars worth of personal protective equipment off the table two years ago, because we felt we were spending on stuff we’d never use - that’s an example of choosing efficiency (having small stocks and no extras) over resilience (being prepared for an unexpected bump in demand). Hopefully a bunch of decisions of that sort will be revisited as a result of what we’ve been through.
Secondly, the pandemic has exposed something more subtle and controversial. When Aristotle created what is effectively the scientific method in 4th Century BC, he said where things cannot be any other way than how they are (i.e. with universal and permanent forces like gravity), your job is to understand the causes and effects and to do your best to optimize them. Where things can be other than they are, however, your job is to be the cause of the effect you want to see. That means there should be two skills at play - scientific skills for optimizing, and skills for imagining possibilities and choosing the most compelling of them to make the world we want.
As we’ve been solving problems and making decisions related to the pandemic, we’ve seen science overreaching beyond what Aristotle intended, and doing exactly what he warned against. We haven’t had Covid-19 before, and we haven’t had a pandemic in this time and place before, so it’s wrong to assume that we are working from a pool of data that is uniform and extends into the future. Some countries, like Sweden for example, were attempting different strategies that they felt were better suited to their own populace, and were pressured to follow the same flatten-the-curve blueprint as every other country. By attempting to enforce a globally uniform approach, we risk destroying all the scientific data we need to be able to look backward and understand what strategy worked best. Five years from now, all we’ll have is data on the one way we operated, and won’t be able to draw any inferences from that. Everyone flattened the curve, but was that the best we could have done? We won’t know.
David and David: Do you believe that we will hang on to the lessons we’ve learned as a result of the pandemic?
Roger: Yes and no. The world is utterly habit-driven. The brain science that’s been done in the last ten years shows that many of our decisions are made at the subconscious, instinctive level, not consciously. What we call “brand loyalty” is actually habitual behavior. If I use Crest and I walk up to a shelf at a pharmacy and reach for Colgate, my subconscious gives me the biggest shout-down it can, and I put the Colgate back and buy Crest, as usual. We’re creatures of habit to a much greater extent than we understand.
Covid-19 has forced us to break our habits, and where they were habits we hated, we won’t be going back. For example, we won’t go back to commuting to work five days per week, or undoing the efficiencies we’ve introduced into processes that were too slow. Where we’ve been forced out of habits we love - going to offices, shaking hands, going out for a nice dinner - we’ll go right back as soon as we can. With respect to those habits, this time will be a distant memory within a year.
David and David: Your upcoming book delves into the pursuit of efficiency and its overall impact on resilience, and the growing yawning socio-economic gap. Why are you warning us about all this?
Roger: My concern stems from my love of both democracy and capitalism. The tricky thing about those two systems together is that 51% of the people have to support the economic system for it to perpetuate. In a totalitarian system, on the other hand, the advantage is that only 1-2% have to support the current system. So for us, the question becomes is the economic system tenable for the political system?
Today, with the fruits of economic expansion going disproportionately to people at the high end of the spectrum, the middle class is stagnating. Unless the 51st percentile family is moving ahead smartly, they will one day say “I don’t like this system, let’s try something else.” A stagnant middle class is a big, big, economic problem. The last time we had a period of middle-class stagnation like this was the Great Depression and at that time, a good chunk of the developed world became communist, fascist or socialist. When the system doesn’t work for the median family, we get a “blow it up” situation, as we’ve seen with many elections globally in the last few years. This points to people wanting a different system, and I’m with Churchill when he said “...democracy is the worst form of government except for all those other forms that have been tried from time to time.”
David and David: What can one determined individual do to change course? What is required of more than one or even a handful of individuals to course correct?
Roger: Everybody has a role to play, but for each it’s not a terribly onerous role. For example, we all need to stop committing all of our business to a single supplier. Amazon isn’t a problem, but if you buy everything from Amazon Prime, that’s bad for humanity. Use your favorite supplier the most, but not exclusively - go to the grocery store, the mall, and other shopping platforms.
Policy makers should be writing an automatic sunsetting revision period into every legislation they pass. That’s an admission that we can’t figure things out completely at a given moment in time, so we’ll have to go back and revise it as things change. Business executives must recognize that slack is not an enemy to be wiped out and defeated; we need to build in a sense of resilience. Educators have to stop teaching students that reductionism is a necessarily good thing, and stop reducing the educational sphere into narrow silos, only to have students walk out into the real world where those silos don’t exist. In other words, we have to do all sorts of little things that add up to a world that recognizes it’s an interconnected, complex adaptive system - not a machine to be perfected.
David and David: Any other advice you can offer? Parting words?
Roger: When it comes to innovation, free yourself up from the strictures of science. When you’re doing new things that have never been done before, you won’t yet be able to cite data as evidence that what you’re doing will work. Don’t let that stop you. When you’re a CEO and you say to the head of R&D, “that sounds like a good idea but we need proof,” even if you say it casually, you’re asking for evidence that doesn’t yet exist. The pressure for proof that a new idea will work before it’s been implemented is a big reason so many CEOs are dissatisfied with innovation.
Original article posted on Forbes on June 22, 2020
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