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Why Truth Eludes Managers?

Nov 05-2020   



The history of war is fraught with strategic perceptions that proved to be way off the reality; the history of business ditto. In his article for Business Review magazine, Prof. Gong Yuzhen of the NSD draws lessons from the battlefield and reminds managers to stay alert to cognitive limitations that are innate to human nature.

 

Prof. Gong is Deputy Dean of BiMBA Business School and a renowned expert in leadership and competitive strategy. The article is an extract of his new book On Adroit Fighter: Sun Tzu’s Art of War and 12 Lectures on Winning Principles .

 

Napoleon was sure of a 90% chance of defeating the Duke of Willington; Hitler was supported by almost all of his generals to invade the Soviet Union; Jiang Kai-shek was confident of finishing off the communist party within three to six months. There’s no shortage of wrong wars fought at a wrong time, in a wrong place, in a wrong way, and with a wrong adversary.

 

Strategic cognition tends to go awry – often by a big margin – simply because of the nature of war. In the words of Carl von Clausewitz, military actions are based on factors of which three fourths are shrouded in a mist. Besides, people are wired to overestimate themselves and underestimate the adversaries, see the world as they like it to be, and reject bad news and their messengers.

 

In a survey of entrepreneurs, one third believe they are on route to 100% success. In another, 33% out of 1,000 engineers rank themselves among the 5% of their peers in terms of business competence. And when failure strikes, it’s convenient to blame the environment.

 

It’s human nature and not the world per se, that blindfolds. Therefore, one can do better by recognizing the limitations of human nature and the irrationality of human cognitions, says Prof. Gong. He recommends three ways to achieve accurate management cognition. Firstly, one should always stay clear-headed about crisis and risks. The best managers start with dissecting the most difficult and complex situations, evaluating multiple possibilities and drafting various action plans. Secondly, one should always keep the cognitive power in the real world. Leaders must go to the frontline because it is the best source for intelligence. Thirdly, one should equip the whole organization with a continuous, dynamic and open cognitive process. In a corporate culture that cares about what’s right and not who’s right, the employees are much likelier to bring the information that will get the organization ever closer to understand the truth.

 

Why Truth Eludes Managers?

Nov 05-2020   



The history of war is fraught with strategic perceptions that proved to be way off the reality; the history of business ditto. In his article for Business Review magazine, Prof. Gong Yuzhen of the NSD draws lessons from the battlefield and reminds managers to stay alert to cognitive limitations that are innate to human nature.

 

Prof. Gong is Deputy Dean of BiMBA Business School and a renowned expert in leadership and competitive strategy. The article is an extract of his new book On Adroit Fighter: Sun Tzu’s Art of War and 12 Lectures on Winning Principles .

 

Napoleon was sure of a 90% chance of defeating the Duke of Willington; Hitler was supported by almost all of his generals to invade the Soviet Union; Jiang Kai-shek was confident of finishing off the communist party within three to six months. There’s no shortage of wrong wars fought at a wrong time, in a wrong place, in a wrong way, and with a wrong adversary.

 

Strategic cognition tends to go awry – often by a big margin – simply because of the nature of war. In the words of Carl von Clausewitz, military actions are based on factors of which three fourths are shrouded in a mist. Besides, people are wired to overestimate themselves and underestimate the adversaries, see the world as they like it to be, and reject bad news and their messengers.

 

In a survey of entrepreneurs, one third believe they are on route to 100% success. In another, 33% out of 1,000 engineers rank themselves among the 5% of their peers in terms of business competence. And when failure strikes, it’s convenient to blame the environment.

 

It’s human nature and not the world per se, that blindfolds. Therefore, one can do better by recognizing the limitations of human nature and the irrationality of human cognitions, says Prof. Gong. He recommends three ways to achieve accurate management cognition. Firstly, one should always stay clear-headed about crisis and risks. The best managers start with dissecting the most difficult and complex situations, evaluating multiple possibilities and drafting various action plans. Secondly, one should always keep the cognitive power in the real world. Leaders must go to the frontline because it is the best source for intelligence. Thirdly, one should equip the whole organization with a continuous, dynamic and open cognitive process. In a corporate culture that cares about what’s right and not who’s right, the employees are much likelier to bring the information that will get the organization ever closer to understand the truth.