Category: Knowing-doing gap

I love my university, I've been treated far better than I deserve during my 25 plus years at Stanford.  But as much a I love it, I wonder if it is time for us to run something like a "stupid rules contest" here.  I once met the CEO of a large bank in New England who explained to me how they had made things much better by running such a contest and taking the suggestions seriously. For example, they got rid of a rule that people waiting outside a branch could not be let in until official opening time.  They changed things so, if it was 10 or 15 minutes before opening time and, say, people were waiting outside in the cold, employees could open the door and let them wait in the warm lobby.

I don't want to mention any specific rules at Stanford, as I don't want to point fingers at any group or person.  But although no doubt each was developed and implemented with the best of intentions, it seems to me that they accumulate like barnacles on a ship, with one after another being added.  Each one slows down the process of teaching and research, and the old ones never seem to be removed.

Perhaps a stupid rules contest here would help. I admire Stanford's leaders, so this is not meant to be an attack on any individual, I just think it is something that happens to organizations over time, and I wonder if it would be a good time to haul our organizational ship into the dry dock and scrape off some of those old barnacles — and perhaps some new ones we have grown to that make things harder to do than need be. 

Alas, the hiatus is permanent. I guess they missed their own obituary for
him on September 27, 2009. I just read this is in The Sunday New York Times
Magazine on page 14 at the bottom of the "On Language" column,
which he wrote for years.  The best part is the title of the article that
appears above, called "Error-Proof." 
Apparently, the Times caught their error, or just have such a long
production lead time that it was too late, as the online version indicates:

Postscript: October 3, 2009
MAGAZINE

A note with the “On Language” column on Page 14
this weekend refers to the absence of the regular columnist, William Safire.
Mr. Safire died last Sunday, after some copies had gone to press.

I know that print
journalism is a tough business, but I did note that the new Economist,
which I got in the mail Friday, also had an obituary for Mr. Safire. 
Mistakes in life are unavoidable and there is no doing anything without making them, but this one cracked me up
because of the name of the article that it appeared under (which is a very nice
essay, by the way, on how the obsession with grammatical correctness is a
"schoolmarm's hallucination"). I suspect the author, Ammon Shea is a
bit horrified by all this, but I hope he also sees the humor and takes heart in
that more people will likely read his column as a result.

This slideshow was on a number of blogs over the summer (see here) , but I wanted to make sure that everyone saw it and, frankly, to get a post here so I have a record of it.  Apparently, Reed Hastings, the amazing CEO of Netflix, put-up a set of 128 slides that is a "reference guide to our freedom and responsibility culture."  I realize that most 128 page slide decks are deadly dull, but this is an exception.  You may not agree with all their values and approaches, but on the whole I think you will be fascinated by the detail and thought.  Now, I have no inside knowledge of what it is like to work at Netflix, but if this is accurate, it is a pretty impressive company — frankly far more enlightened than most in Silicon Valley. 

They also don't pull any punches, the second slide says that these principles only for salaried employees not hourly. Before laying out their values, they acknowledge that most companies are unaffected by their written values. After laying out their values, they end by saying that a related core value is to question actions that clash with the values. Indeed, that is the real test of any social norm, what happens when someone breaks it?  Are they applauded, do people look the other way, and when people speak-up against the violation do they get slammed?  Or do bosses actually listen and try to make repairs?  Indeed, if you are or were at Netflix insiders, I would love to know if this is hollow rhetoric or a real living and breathing social norm.

 I could go on and on, but this is such an impressive document, you will find many things to get you thinking.  I doubt you will agree with everything — I didn't, as there was a bit too much emphasis on superstars. Indeed, there was a lot of debate in the comments about that.  Of course, I did love the assertion that, unlike many companies, they would not tolerate brilliant jerks. So it is nice to see another company with an (albeit polite version) of The No Asshole Rule.

Tell me what you think about the deck. I am probably going to assign it next year in my introduction to organizational behavior class and ask the students to write a little on essay on it.

P.S. Thanks to Whitney and Yosem for telling me about this slideshow.

One interesting thing that happened while I was on vacation was the news that Wal-Mart is test-marketing imitations of the two best-selling Girl Scout cookies, Thin Mints and Tagalongs.  To get a "flavor" of the reactions to this move, check-out the post that CV Harquail did on her blog Wal-Mart Knocks-Off Girl Scout Cookies.  And see CV's follow-up post Thin-Minty Gate. Over 150 people commented on the first post and this news has spread far and wide.  As regular readers of this blog know, I am biased in this matter because my wife Marina Park is CEO of the Northern California Girl Scouts. My view (and I am not speaking for Marina, in fact, I didn't tell her I was writing this post) is that — holding things aside like ethics, financial damage done to the Girl Scouts, and other things that harm outsiders — this is a dumb business decision for Wal-Mart, and the real mystery is how the smart people at Wal-Mart (and they are smart and decent human-beings) could do something that:

1. Further fuels their reputation as one of the most heartless and greedy companies on the planet (true or not, they are seen this way in many places).

2. Damages their relationships in communities where they already have stores.  In many of those communities, Wal-Mart works closely with Girl Scouts to provide a place to sell the cookies in front of the store.  The weird dynamic of having very similar cookies sold inside Wal-Mart at a lower price may or may not hurt the cookie sales (because most of us realize that, after all, they are going to a good cause — allowing girls to go to camp, on trips, buy equipment for learning projects, supporting programs for inner-city girls and those in juvenile detention facilities, to pay remarkably dedicated and modestly compensated staff members, and on and on). But it clearly hurts Wal-Mart, creating the perception that they are going into direct competition with those girls and are acting out of pure greed.

3. Makes it harder to open new stories. It turns out that when Wal-Mart wants to put a store in a community, there is organized resistance in about one third of cases and that, when it happens, this resistance is highly effective: the store is stopped about two-thirds of the time.  So, roughly, Wal-Mart fails to get stores where it wants in over 20% of cases as a result of resistance from communities.  And even when they do overcome the resistance, the fight costs them serious time and money.  In light of these facts, going toe-to-toe with Girl Scouts is sheer idiocy because it provides a compelling rallying cry ("Wal-Mart isn't only going to be competing with the local merchants, they are also going to undercut the Girl Scouts") that increases both the likelihood of resistance and the success. I have no access to the numbers, but I am willing to bet that if Thin Minty Gate results in the failure of even one store opening for Wal-Mart, any profits from the knock-off will not offset the cost of losing that one store.

Perhaps the most interesting question here is how such smart people could do something that is so dumb.  It sounds more like an Onion story that a real story. I don't claim to  have deep or extensive knowledge of Wal-Mart, but we did work with some fairly senior executives from Wal-Mart several years back in one of our d.school classes (see here and here), and I was quite impressed with their action orientation and focus on cost-saving and efficiency.  The brilliance –and the Achilles heel — of Wall-Mart is that they talk and act as if the answer to every problem is to use their scale, bargaining power, and speedy implementation to tackle any problem by driving down the price they pay and pass it along to consumers.  This is great, for example, when they use their bargaining power to bring down the cost of environmental friendly LED lights in their refrigerators so that they become cheaper than traditional lights.  But when "everyday low prices" is the solution to every problem and — despite lip service to other constraints — almost nothing else drives your behavior even when it hurts you badly (as in this cookie caper), your core cultural values can hurt you badly.

As far as I know, Wal-Mart hasn't announced that they are stopping the knock-offs.  My prediction is that they will come-up with some bullshit business reason to do so.  If they were smart (and there is research on this, on how to deal with mistakes, which we talk about in Hard Facts and I touch on  here and here) they would: 1. Confess it was a mistake, that they should have been more sensitive to the importance cookies to Girl Scouts; 2. Explain this episode has made them more sensitive to how pure business decisions need to be considered in light of community relationships and their corporate image; 3. Announce and take formal steps to show they have learned this lesson. 

Let's see what happens.  My experience with Wal-Mart is that these are good people who mean well, they are extremely competent, but sometimes are blinded by their culture — this appears to be a case where they suffered from a severe knowing-doing gap that could have been averted by simply asking a few objective outsiders to react to what they were doing.   But asking others for honest feedback and listening to them is something that we human-beings often fail to do, despite the best of intentions. 

I just ran across an old UPS commercial on YouTube that I sometimes play when I give talks on The Knowing-Doing Gap and how to close the Smart-Talk Trap.  It is quite funny and quite true of many consultants, and I love the punchline: "Sir, we don't actually do what we propose.  We just propose it."  The commercial does a lovely job of making the point that knowledge without action is just as bad as no knowledge at all. I am sorry it is grainy, but I love the content and the acting.

I should also confess that there are times when I am those guys in the commercial  –giving advice that I don't implement.  I do believe that there are times when businesses clients benefit from sound advice that they then implement themselves (Exhibit one here might be W. Edwards Deming's impact on the Japanese auto industry). But there are still too many times in business when people act as if once they hear and talk about a good idea, their work is done even if no one ever actually gets around to testing or implementing it. That is the disease that Jeff Pfeffer and I take aim at in The Knowing-Doing Gap.

'The situation when no one feels comfortable giving an
answer other than "it depends"

This is similar to the
"teeter-totter syndrome" in The Peter Principle, defined in their amazing glossary as simply the "inability to make decisions," in fact, I guess dependicitis is a special case — or root cause — of the teeter-totter syndrome.

Thanks Xaio!

One of the main themes on The Knowing-Doing Gap is something that we call "The Smart Talk Trap," that there are too many times in organizations when executives, managers, and other people say smart things instead of doing smart things, and somehow after they have said all the right things, they feel so much better that they believe no other action is necessary or somehow their magical words will turn into action without having to do anything else.  Another variation is when bosses do seemingly brilliant talk, talk that they believe is brilliant too, and then — because they don't know what they are talking about — people either resist turning it into action or, when they try, it turns out to be impossible (I recall a stage gate system at one of my client's organizations that was impossible to use.)  Indeed, bad ideas of this last variety helped inspire Jeff Pfeffer and I to write Hard Facts because we kept dealing with organizations where people believed that they were doing the right thing, but we believed it was wrong based on the best evidence– they suffered from doing-knowing gaps, as we came to call them.

The above cartoon is intriguing because it seems to reflect a case of skilled bullshitting leading to dumb action — and the bullshitter knows it is dumb.  Dilbert thought it he was talking about garbage, he just threw together a presentation to get through a meeting. Unlike many bosses and others who do this,however, Dilbert realizes his ideas are garbage — but now it seems they are being acted upon!  The only other thing I've ever heard like this in real corporate life happened with a talking Barney doll at Microsoft.  Here is the story from Weird Ideas That Work — note that like Dilbert, it was an idea that the team believed was bad from the start, yet somehow it was turned into action.  The extra twist was whether or not the product sucked, it was a commercial success.  This story was told to me in 2000 by Justin Kitch, CEO and founder of Homestead, a dotcom start-up that still exists and apparently was bought by Intuit.  I am also impressed to see that Justin is still CEO, and in fact, most of his founding team is still intact.   I have to learn more about what happened. 

Here is the Barney story:

Right after he graduated from Stanford,
Justin went to work for Microsoft in a group that developed educational software
for young children.  One day, Justin led a brainstorming session on “What
would be the worst product we could possibly build.”  His idea was 
“Let’s do that, and think opposite.  Think about what’s the worst
characteristics it could have?  What’s the least educational thing we
could do?”   The result was  “A talking Barney Doll, it was
called Barney 1, 2, 3.  It was a Barney doll that talked to you and taught
you numbers.   I still have the drawing.   I made it as a
total joke and I gave it to my boss.” 

To Justin’s dismay, Microsoft came out with pretty much the same product a
couple years later.  He said  “I couldn’t believe it.  They
built exactly what we brainstormed would be the worst possible product.” 

Note that Justin seemed confident that “my
team's little chuckle over Barney had nothing to do with the eventual project,” but
others I talked to were less sure — in any event Justin made clear to me that he refused to take any credit for that "piece of shit."  This little incident and Dilbert’s cartoon suggest that you have to
be careful who you show your silly ideas to – and in Justin’s case, the lesson is also that ideas
that seem dumb may have more merit than you think – at least by commercial
standards.

P.S. The phrase "Smart Talk Trap" was actually invented by Suzy Welch, yes Jack's wife, when she was an editor at the Harvard Business Review and worked on a paper based The Knowing-Doing Gap. Suzy was a damn good editor.