Why are Clever Executives Failing?


Share on LinkedIn

Why didn’t General Motors or Blockbuster see it coming? Thousands of companies of all sizes, focusing on doing better what they are already do. don’t see it coming. With hindsight the mistakes are clear. Yet, GM and Blockbuster employ some very bright people.. Many bright and previously successful executives are unable to prevent their company’s fortunes from declining.

Why are clever people failing? The problem is obvious – they are stuck in the past. Now the key question is how can companies adapt and thrive in a fast-changing and increasingly complex business world? You’ve heard it, Innovate of Die! But a leader can’t lead innovation if his or her adaptive potential is not up to snuff. Or, as Marcel Proust put it,

The real act of discovery consists not in finding new lands but in seeing with new eyes.

Adaptive Thinking

The more the business environment changes, the faster the value of what you know diminishes. Success hinges on the ability to participate in a growing array of knowledge flows. John Hagel, John Seely Brown and Lang Davison

Adaptive thinking requires the appreciation of context, the interrelated conditions or situation in which something exists and the circumstances that defines meaning or value. The context that is all-important is that of customers. Customers experience the impact of change and their context shifts. When a product or services is out-of-context with customers it is less meaningful and less valuable to them. Web browsers and Netflix didn’t make DVD rental less valuable to the customer. The customer’s context shifted and Blockbuster became much less relevant. A new context of convenience appealed to overwhelmed customers.

Seek Insight into New Meaning

Too much information, too fast, is a problem. When we filter and reduce the overload we seek confirmation of what we already believe. This is a serious liability. Insights and opportunities lie in surprises. If surprises are filtered out, we cannot see with Proust’s “new eyes.”

The Importance of Connectedness

In 1987 people felt they had 75% of the knowledge needed to do their jobs. In 1997, the had only 20% (Kelley). Today we would expect the percentage to be much less. For virtually all of us it is impossible to function independently these days. So the question is do you have a networked brain trust to help you in your sense making?

The Adaptive Potential of an Outside-in Approach

Understanding the customers’ changing context of means tapping into new flows of information. It means that businesses need to take an Outside-in approach to designing and delivering their value proposition. PUSH becomes PULL. Customers must be attracted. An outside-in approach goes beyond listen to customers. It envisions new value for customers that they do not yet see. Outside-in is more than tapping into new information flows—it requires a new way of turning information into insights and possibilities in order to create and deliver value to customers.

Executives need to make sense out of change and innovation from the customer’s perspective then help customers see it.

The Importance of Sense Making

Sense making is the new and very pressing challenge for business leaders – one that will ultimately measure their worth. Daniel Pink makes a persuasive argument that business must take sense making seriously in his book, A Whole New Mind: Moving from the Information Age to the Conceptual Age, Unfortunately, the Whole New Mind that Pink describes is a new way of thinking, a little messy or soft, is not rewarded in today’s organizations. Analytic skills are more definable and explicit knowledge is more teachable and measurable.

Sense making involves seeing what has changed and, most importantly, considering the implications. It is not about predicting the future but rather it is about seeing an emerging present. It involves concepts like intuition, prescience or gut feelings. It also takes a new form of persuasion and leadership to articulated the vision to others. At the core of this type of thinking is the ability to take different perspectives – really different perspectives.

Start today – step back, reset you lens and see your business with “new eyes.”


Please enter your comment!
Please enter your name here