Sunday, December 6, 2015

Are Organisations Good at Learning?

Francesca Gino and Bradley Staats highlight how “our traditional obsessions – success, taking action, fitting in, and relying on experts actually undermine continuous improvement. Virtually all leaders believe that to stay competitive, their enterprises must learn and improve every day. But even companies revered for their dedication to continuous learning find it difficult to always practice what they preach. Consider Toyota: Continuous improvement is one of the pillars of its famed business philosophy. After serious problems in late 2009 led Toyota to recall more than 9 million vehicles worldwide, its leaders confessed that their quest to become the world’s largest automobile producer had compromised their devotion to learning,” (p.111-112).
If one looks at the media these days when they report on business, everything is short term – they aren’t interested in organisations that have a long term view, they only seem to be interested in reporting “success” now. This in itself has undermined how many organisations view real success, and how too often organisations ‘sing’ to the tune of the press, terrified of even the slightest hint of failure. But if we look back on our lives, how much did we learn growing up through the mistakes we made. In fact wasn’t that some of the fun of our youth – to experiment as a way to learn, where success or failure was a positive experience to learn something from? We’re not talking about the irresponsibility of youth – but of that pioneering spirit that lives within us all.
To support this thought Gino and Staats (p.112-113) ask “why do companies struggle to become or remain ‘learning organisations? Through research conducted over the past decade across a wide range of industries, we have drawn this conclusion: Biases cause people to focus too much on success, take action too quickly, try too hard to fit in, and depend too much on experts. Leaders across organisations may say that learning comes from failure, but their actions show a preoccupation with success. This focus is not surprising, but it is often excessive and impedes learning by raising four challenges;
Challenge #1: Fear of Failure. Where organisations don’t develop new capabilities or take appropriate risks, unless managers tolerate failure and insist that it be openly discussed.
Challenge #2: A Fixed Mindset. People who have a fixed mindset aim to appear smart at all costs and see failure as something to be avoided, fearing it will make them seem incompetent.
Challenge #3: Overreliance on Past Performance: When making hiring and promotion decisions, leaders often put too much emphasis on performance and not enough on potential to learn.
Challenge #4: The Attribution Bias: It is common for people to ascribe their success to hard work, brilliance, and skill rather than luck; however, they blame their failure on bad fortune. This phenomenon, known as the attribution bias, hinders learning.
Yet the years have not been kind to risk taking and the pioneering spirit and in today’s so called modern world the fear of failure is often learnt long before one starts a career in business and in a sense goes against the inquisitive nature of us human beings. Not that long ago, the men and women who pioneered so many incredible inventions and discoveries, actually embraced failure. We know the story of Edison and the invention of the light bulb – and just how many attempts it took him to find the right solution. Yet one has to wonder if Edison would ever had invented the light bulb in today’s unforgiving business environment? But the fact that one might have to think just for a moment as to whether Edison would have survived in today’s ‘success only’ business environment should be cause for concern.
But is it really external factors, like the media, that defines an organisations cultural approach to failure or is it how their leaders respond to the external environment and how much they believe that they control their organisations destiny and decide to embrace failure as part of their positive culture – rising above even their ego’s.  
Gino and Staats give this example; “consider professional soccer goalkeepers and their strategies for defending against penalty kicks. According to a study by Michael bar-Eli and colleagues, those goalkeepers who stay in the centre of the goal, rather than diving to the left or the right, actually perform the best: They have a 33.3% chance of stopping the ball. Nonetheless, goalkeepers stay in the centre only 6.3% of the time. Why? Because it looks and feels better to have missed the ball by diving, even if it turns out to be the wrong direction, than to have stood still and watched the ball sail by,” (p.114).
We live in a world where, sadly, there are too many people just waiting for business organizations to make a mistake – it’s a quick easy story – but this vulture like approach to failure is probably having a major detrimental impact on the true potential progress of too many organisations around the globe. Organisations that are spending too much time and effort worried about failure – when it’s failures that will actually take them to the next level.
Gino and Staats conclude by stating that “it may be cheaper and easier in the short run to ignore failures, schedule work so that there’s no time for reflection, require compliance with organizational norms, and turn to experts for quick solutions. But these short-term approaches will limit the organisations ability to learn. If leaders institute ways to counter the four biases we have identified, they will unleash the power of learning throughout their operations. Only then will their companies truly improve continuously, p.118
Gino, F. and Staats, B. (2015). Why Organizations Don’t Learn. Harvard Business Review. November, p.110-118.