Does Your Comapny Culture Reward the Lazy Brain?
The world is becoming more competitive every year, and to be successful, organizations must constantly “learn, adapt, and innovate,” Professor Edward D. Hess says.
One big problem is that generally, the human brain prefers to operate in low gear, rather than high gear. Professor Hess says this is “lazy thinking” at work, and it stops humans from generating and implementing new ideas.
Professor Hess notes that Nobel laureate and behavioral economist, Daniel Kahneman, says “Laziness is built deep into our nature.” The professor says this causes a problem because business has taken what it calls “operational excellence” as far as it can go.
The brain uses around 20 percent of the body’s energy, but is only about 2.5 percent of our body weight, so it needs to conserve energy, otherwise, it would consume more, leaving much less for the rest of the body’s functions.
According to Hess, a professor at Darden Graduate School of Business at the University of Virginia, “The lazy brain is why the operational excellence model – in which companies fight for dominance by being faster, better, and cheaper – rose to dominance in the first place.”
Machines are now taking over many of the jobs that fit into the lazy thinking model.
To survive, companies must utilize the only real competitive advantage – the human ability to learn and innovate.
Many businesses operate on the old lazy-thinking model, and find it impossible to innovate their way out of a wet paper bag.
Hess advises companies to seriously shake up their culture, engaging and rewarding people so strongly that they’re willing to override their natural tendency toward laziness and continuously generate and share new ideas – that is, to create an idea meritocracy.
Empower Fast, Cheap, Customer-Centric Experimentation
As an example of what this means, Hess found that Intuit created a new culture and new processes designed to create an idea meritocracy. They galvanized product development by discovering often-unstated customer needs and creating solutions for them.
Intuit tested key customer needs or value assumptions so they could move quickly on critical ‘must-have’ data. They started small in scope until innovators had more and better data to justify a larger investment.”
“In India, young Intuit innovators conducted an experiment on helping farmers get the best price for their products-even though management initially wasn’t interested in the idea. Operating under Intuit’s new “Caesar is dead” principle, they forged ahead with their research and spent time with farmers to understand their business challenges. They found the farmers didn’t know what price wholesalers would pay on any given day in any geographical market for their crops. So, they created an app for mobile phones that provided farmers with daily prices from various markets. As a result, the farmers could choose to travel to the market that would pay them the highest price; 1.6 million Indian farmers now use the successful program.”
Turn Mistakes Into Surprises
Using Intuit for his second example, Hess says they need to have a new mental model about mistakes, because many ideas don’t work out. In an idea meritocracy, as long as financial risk parameters are respected, mistakes like these are not punished, they are seen as a learning opportunity.
Teach Employees To Work Around Their Weaknesses
Bridgewater Associates, a successful hedge fund in the world, implemented an idea meritocracy by creating a new culture and processes designed to help people overcome the common human obstacles to learning; cognitive blindness, dissonance and biases, and their ego-driven emotional defensiveness. This is possible through transparency, testing everyone’s thinking, use of best learning processes, complete candor, permission to speak freely, and an egalitarian idea meritocracy where everyone has the duty to challenge all ideas.
Take Bold Action
Employees must be able not only to point out problems, but to take bold action to correct them. Toyota empowered employees to take ownership of preventing defects and mistakes. This was Toyota’s quality differentiator for years, but Hess says “Toyota diluted that system in its drive for global expansion and global sales leadership.”
Make It A Duty To Dissent
The culture at Google is about trying new things, driving innovation and experimentation.
“At Google, permission to speak freely is not enough-one has a duty to dissent,” notes Hess. “This means that relative ‘rookies’ can-and do-raise objections and present alternate ideas when they disagree with their bosses. A similar duty to dissent can be found at UPS, which has an employee-centric culture of ‘constructive dissatisfaction,’ meaning that everyone has the duty to find ways to improve.
Allowing dissent combats lazy thinking, Hess says. “When employees know their voices not only will be heard but are needed, they’re far more likely to engage in the kind of thinking that leads to big ideas and positive changes.”
Hess says that idea meritocracies can continuously improve or innovate faster and better than the competition.
“Seek to engage all employees in constant improvement or innovation through everyday learning,” he advises. “No matter what product or service you sell, in order to compete in a technologically advancing, highly globalized competitive environment, you must be in the business of learning. You must build a culture where lazy thinking is snuffed out and big thinking is encouraged and rewarded.”
