“Our natural tendency to avoid the pain of loss is most likely to distort our thinking.”

- Ori Brafman and Rom Brafman from their book “Sway”.

“Hey Joe, check this out! A nice ripe apple, just sitting here.”

“Frank, don’t touch it. It’s a trap.”

“No way, it’s our lucky day.”

“Frank, we’re smart deer. It’s the middle of winter, and we haven’t found food on top of the snow for weeks. It’s a trap.”

“I don’t care what you think, I’m eating it.”

“Suit yourself, I’m out of here.”

Whooompf…

“Hey Joe…”

“Yes Frank.”

“Can you find me a sharp stone so I can cut myself free of this net?”

“Ok, but this is the last time…”

Detective Joe Friday said it best – give me the facts, just the facts. If the human race relied on “just the facts”, it would be much further ahead. However, we’re human, and we fall victim to irrational behaviour. It’s what makes us human after all.

The fact is - it’s human behaviour to make bad choices from time to time.

The Problem is - when there are large amounts of money or time at stake, making bad choices can become a serious issue.

The Outcome is – one organization after another gets sucked into situations where tremendous amounts of money have been spent, and inflated egos prevent any admission of error. As a result, bad courses of action are continued to the detriment of the organization.

The Solution is - to have a clear, candid view of your organization, and its industry, coupled with a strong sense of humility that allows for mid-course corrections.

Organizational Behaviour Issues

Your organization is not alone. It happens time and time again. A decision is reached on biased information. A choice tainted by arrogance. The question is, how and why does this happen? Your employees are smart, aren’t they?

The short answer is yes, they are smart, but they are also emotional creatures. They want to succeed, they sometimes get blinded. Then, add other emotional creatures, and their ambitions, and you’ve got the potential for a really big problem.

Sorry for Your Loss

In the book “Sway”, brothers Ori and Rom Brafman conclude that, in many cases, the human tendency to try to avoid loss of any kind causes much of this behaviour. With the recent economic meltdown, the fear of loss became very real, and shareholder satisfaction was paramount. Organizations made several bad choices:

• who to layoff
• what products to discontinue
• where to relocate offices

With pressure mounting, and the fear of loss at an extremely high level, there was a recipe for disaster.

As the economy begins to pick itself back up, one can only hope that organizations have discovered some of their shortcomings, and have learned that in order to survive the next (yes, the next) downturn, they had better have a plan. Or they risk losing everything.

Swaying in the Wind

As the winds of change pick up within an organization, there must be a strong sense of flexibility. Choices will be made, opinions will vary, and the organization must be constantly monitoring progress and outcomes.

There is no room for paranoia, only candour and clarity.

Short term priorities will shift. Leaders must prepare their employees for this reality, while maintaining a focus on the future. Leaders must also welcome feedback from each and every employee to ensure that decisions are grounded, and, if changes must be made, the success of the organization remains paramount.

In Our Opinion
The Beacon Group’s Keys to Making Sound Choices

Benchmark - While your organization may feel they already benchmark, when you do so, be sure you are looking for best in class, not solely best in industry. If your entire industry is headed in the wrong direction, there is no hope for your organization.

Seek Outside Opinions - Every now and then you must consult with outsiders to ensure that your organizational culture is not becoming a set of blinders to your organization’s reality.

Fall on Small Swords - The goal of the organization should be to live to fight another day. Choose your battles, and admit defeat on some decisions. It’s healthy and a learning experience for next time.