Humans inherently ask the wrong questions

Humans inherently ask the wrong questions

People in business today are trapped within their own frame of reference. The result of poor hiring practices?  More likely the challenges that companies put in front of employees but without giving them the capability to search for answers to complex problems – with nuance and experience major contributors to the answers set. Nuance is as much of the corporate knowledge base as is hard financial numbers.  The unknown is similarly a corporate asset.  But even the best companies today provide lots of data but limited ability to determine meaning.

Business (also schools) has trained people to stay within a sphere of reference – some (not all) in-house data and limited external information.  The approaches to Business Intelligence applications haven’t helped as they are often limited to relating “like” information – like financial data. The result is that business has contributed to the perspective that humans don’t ask the right question because we have never given them the opportunity, training and empowerment to succeed.

Usually pushed off as too expensive to acquire or too complex to bring together, we have worked hard to justify the limited information available to people making corporate decisions.  We have provided ‘answers’ when supporting additional questioning is required. The limited foresight that exists related to corporate information use.  If Sam Walton had not had the foresight that information on all transactions going through cash registers, deep knowledge of customers and local market bias, and the power of sharing thee resultant knowledge with suppliers, he would have built just another big-box retail outlet.  However Walton, armed with a far reaching vision of the power of knowledge, created a new retail concept.  He enabled his buyers to ask span-crossing questions and supported the answer determination with some of the largest databases in the world.  Each buyer has access to petabytes of transactional information to base decisions.

Corporate decisioning has also contributed to the myth that people ask the wrong questions.  Decisions have often been made on direction and approach.  When employees, armed with knowledge see answers that don’t fit the mold, management is loathe to listen.  People begin to fear the answer. If it is not the expected or wanted answer, retribution is often the result.  People are boxed into a world that even if they have the knowledge base, and the capability of questioning to get ‘answers’ the answers are not ‘right’.

I have always asked companies to value their customers from most to least profitable.  The ranking then begs the obvious question – why don’t we fire the non-profitable customers.  The answer should be to fire them and put the resources (product development, marketing etc) to bear on the profitable customers.  Too often the answer is unpalatable to (especially middle management) management because it forces the realization that business as usual is not as good as it could be if hard decisions are made.  Great examples are the US airline industry and US Banking.  In major banks, profitable customers generally are less than 20% of the base and yet the banks continue to promote expansion of that base – acquiring four non-profitable customers for every profitable one and often a high cost.  The airlines try to be everything to everybody.  With the exception of focused air carriers (Southwest, AirTran), most airlines would probably be better off firing all unprofitable customers – but when management looks at the situation, they realize that their company might be highly profitable if they act, but the business model will be different – instead of a $10 Billion revenue airline, it might be only $1Billion – but highly profitable.  “Business as usual” is always the decision maker.

Facts versus trends. It is easier to state that ‘we sold 100 widgets this month’ vs. looking a trend that says “worldwide widget sales are down and we should evaluate whether we should continue with this product”

Why don’t we ask the right questions???

Technology is transforming innovation at its core, allowing companies to enable new ideas at speeds and costs that were unforeseeable a few short years ago. They can see results from promotions, process change and productivity improvements quickly. Initiatives that used to take months and huge expense to coordinate and launch can be performed at low cost. Innovation becomes more efficient and cheaper.

Innovation in the enablement of knowledge creation and use will bring big changes for corporate culture—making it easier to challenge business as usual, and force managers to give more personnel throughout the company the capability, encouragement and reward for asking the hard questions that give answers that enable profitability and transformation.  The provision of the real corporate knowledge base and the tools to use it will eliminate the perception that people ask inherently ask the wrong question.

 

©Trevelyan Group LLC 2012