On Myths and Superstition in Business

Those who are on the quest for wisdom and enlightenment about business life have an enormous array of best-selling books to pick from. Even better, you need to look no further than your LinkedIn timeline, a place full of advice on leadership, management, and decision making. The only catch: Nobody seems to care if these pearls of wisdom are true or productive. What is the cause of such superstitions in a sub-culture full of smart and scientifically literate people?

Most of the kind of advice that I want to single out in this article follows the following pattern:

  • Formulate a principle that intuitively rings true or resonates with a particular audience.
  • Provide evidence by pointing out some hand-picked examples that could be explained by the principle.
  • Start applying the principle to a broad range of situations.

Let me illustrate the pattern with two examples.

Starting with WHY

Simon Sinek is a goldmine for these kinds of wisdom. In his well-known work “Start with Why” he argues that it is important to first get the vision, the WHY of any undertaking right before diving into the WHAT and the HOW. As such this is absolutely an interesting thought: Most of us will have experienced being part of an undertaking with an unclear purpose and can appreciate that having a mission and a sense of purpose is much more motivating. I do recommend watching his TED talk that discusses the same idea, Sinek is an amazing public speaker. However, from a full book on the subject, you would expect a deeper development of the argument, underpinned by evidence and a nuanced discussion of possible applications.

Instead, Sinek draws on a very small set of selected examples to make his case. He focusses heavily on Apple, Harley Davidson, and Southwest Airlines. For these companies, you can certainly make an argument that their messaging and branding are very consistent with a clear focus on a target market. Had Sinek limited his reasoning to how these companies found their market niche and constructed a brand identity around this niche, I would be fully on board with his reasoning.

However, Sinek takes the principle and extends it to a very broad range of applications: The civil rights movement, building trust in human relations, crossing Geoffrey Moore’s famous chasm and the Wright brother’s first flight. Really? The main thing that qualified Dr. King for his place in history was his having a clear sense of purpose?

It sounds true that having a mission of some sort is likely better for morale and customer loyalty than not having one. However, the advice provided in Sinek’s book is also strikingly unspecific. It does not take the step from feeding the vague feeling that something should be done to providing advice on what this something is. For example, Sinek proposes that the statement of purpose that separates Apple from the rest is the belief in “challenging the status quo”. It is hard to believe that such vague phrases alone would be sufficient to make any meaningful difference in forming a brand identity let alone business success.

Other people have formulated better and more detailed critiques of his work, capturing exactly my impressions. This is why I will not dive any deeper into the countless other problems.

What I do want to highlight is that in spite of his shortcomings the simple rule, the golden circle, starting with WHY somehow stuck and is now echoed as if it was a leadership principle that decisions can be based on.

Parkinson’s Law

A second, somewhat different example I have in mind is what has become known as “Parkinson’s Law”:

It is a commonplace observation that work expands so as to fill the time available for its completion.

C. Northcote Parkinson, The Economist, 1955

To be clear, I think that Parkinson’s article is great. It’s an amusing investigation into the phenomenon of growing bodies of public administration even if the amount of work accomplished by this same public administration does not seem to increase.

However, we now find ourselves with a cottage industry of management gurus that take this first sentence out of context, postulate it as a law of nature and draw the inverse conclusion that in order to increase productivity, all you need to do is to set tight deadlines.

As above, a principle which certainly rings true is underpinned by anecdotal evidence from a very narrow set of examples and then promoted to a general rule that can be applied much more broadly.

Parkinson’s article is meant to be provocative and is hence written using a pointed and sweeping language. This way of reasoning is, however, inadequate and lacking nuance if the goal is to make real strategic decisions.

Why is this problematic and why does it exist?

Having seen the pattern, let us talk about why it problematic. After all in all cases we are starting with an in itself interesting thought. Furthermore, the fact that the arguments are only supported by anecdotal evidence is not in itself problematic in my opinion. I am guilty of the same in my own writing. In a complex environment, quantitative evidence is not necessarily superior as numbers can provide a wrong sense of certainty.

What I do find problematic is pushing a message that is not designed to educate but to cater to a specific target audience. Even more disappointing is the avoidance of any acknowledgment that your theory could fail under certain circumstances. And I find it dishonest to overstate the applicability of a principle by projecting it without nuance onto a broad set of application areas.

In his 1974 Caltech commencement speech, Richard Feynman talked about the lack of scientific integrity in what he called the Cargo Cult Science:

[T]here is one feature I notice that is generally missing in Cargo Cult Science. […] It’s a kind of scientific integrity, a principle of scientific thought that corresponds to a kind of utter honesty – a kind of leaning over backwards. For example, if you’re doing an experiment, you should report everything that you think might make it invalid not only what you think is right about it: other causes that could possibly explain your results; and things you thought of that you’ve eliminated by some other experiment, and how they worked […].

If you make a theory, for example, and advertise it, or put it out, then you must also put down all the facts that disagree with it, as well as those that agree with it.

Richard Feynman, emphasis mine.

This same lack of integrity is what I find most troubling in Simon Sinek’s work and much of the wisdom being propagated by other business gurus.

I suspect that in the world of business, the incentives are working against scientific integrity as Feynman describes it: If a company would bring me in as a consultant asking “do you have a solution for our need?” A resounding YES has higher chances of commercial success than a nuanced elaboration. Not knowing something is not a way to get promoted, having a strong opinion, placing a big bet and winning (maybe by sheer luck) is.

Furthermore, applying the scientific method to carry out experiments that establish which principles work and which don’t is unrealistic given economic pressures. Controlling for all relevant noisy variables that could influence the experiment seems utterly impractical.

Lastly, I think we need to acknowledge the difficulty of the job of managers not involved in the daily operations: Any influence they have is indirect through goal setting, positioning of people and teams as well as very broad vision statements. This is a world full of unknowns. People proposing clear and simple recipes maybe offer some relief away from the messy reality, painting the picture of a world that is structured according to clear understandable principles.

I don’t know how to solve this and I would just like to raise the question: How can we, against the odds, create an environment in which not the bold and flashy gains the most traction but the carefully nuanced analysis? If you, dear reader, made it this far and you have any ideas I would love to hear them.

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