Social Business: Fast and Slow

Article In Brief:

We unconsciously gravitate to the familiar, even when we know it’s the wrong decision
Dealing with technology is familiar, dealing with culture is not. Yet the only way to succeed at social business is to address culture.
You can teach yourself to overcome this risk to social business initiatives
Companies do not typically fail for lack of implementing technology, but they do fail because of cultural issues

One of the best books I’ve read over the course of the last few years was “Thinking, Fast and Slow” by Daniel Kahneman. It deals with the learnings over the course of his storied career in challenging, and progressing the understanding of how and why we apply judgment and decision making. Bear with me a moment as I give a bit of background and I promise we’ll get back to social business.

The title of the book refers to the premise that we have two different mental systems that drive the way we think. For the sake of simplicity, you can think of ‘Fast’ (System 1) as intuitive, unconscious, and emotionally based while ‘Slow’ (System 2) is more consciously deliberate, and logical.

One item in regard to how these two systems interrelate is that when faced with a complex question we unconsciously substitute a simpler question to answer in its place. This simpler question is typically something that appears related and can easily be retrieved from the mind (known as an availability heuristic). This substitution principle is incredibly useful in many cases (otherwise we’d be in a constant state of ‘analysis paralysis’), but it also leads us astray without us even knowing it.

The Face Of Politics

A simple, but troubling, example: “How good of a job do I think this politician will do?“, a difficult question to predict an answer to, is simplified in the mind to “How much do I like this person?“. Your brain could care less that you have no real idea of whether you would really like them if you spent time with them, much less whether you have analyzed their policy history and capabilities. It made a split second decision about the person the moment it saw them (good, bad, trustworthy, untrustworthy, etc.) and no matter what you think you believe, that influenced your answer…strongly.

Back To Social Business

So, that’s no doubt interesting, but what does it have to do with social business? On this blog and elsewhere we preach the fact that social business at its core is about culture, organizational design, and the change management efforts to enable that. We also stress over and over the fact that technology is a phenomenal enabler of these efforts but it is not an answer in and of itself.

Ignorance Is Bliss

And yet, when we look at the focus of companies that haven’t matured as fully when it comes to social business we find that they invariably fall back on acquisition of technology as a measure of ‘movement’. This seems counterintuitive.

Don’t they read all the materials that warn against skipping over the cultural aspects of adoption? Even the top technology vendors themselves acknowledge this so it’s not really a secret. It’s likely they have, so why would they ignore this advice and repeat the same mistakes of the past that put themselves at risk?

It’s a good question, and there are quite a few variables in play here. But I’d like to put forth the premise that it is this psychological substitution principle at work. When faced with a more difficult to comprehend question like “How do I change a corporate culture?” (which for many people represents a complete unknown in regard to getting started), the mind shifts to an easier question that is more familiar.

“What are the cultural elements of business transformation?” is the equivalent of a question like “What is this house worth?”. In the case of the house we can evaluate it, bring in inspectors, do our own statistical analysis of local school system quality, etc. or we can do what everyone else does and just look for relative house prices nearby (known as ‘anchoring’) and stick a number on it. This type of heuristic shortcut is actually quite effective in this case and saves us a lot of time. But when faced with something like “How do I best transform my business?” its value breaks down.

Familiarity Breeds Comfort

This is partially why people gravitate towards case studies, maturity models, and other shortcuts. Our minds desperately seek to simplify perceived complexity into something deemed actionable and familiar. The problem is that the average businessperson is much more acclimated to issues of technology than they are culture. It’s irrelevant whether that past experience with

technology has been good, or bad, it passes the ‘availability heuristic’ test and is latched onto when given other options that aren’t as familiar.

To succeed however, you need all three legs of the stool working in concert. The three legged stool of “People, Process, and Platforms” is not a multiple choice question. A plan destined for success must incorporate them all together because they have strong inter-dependencies. A technology deployment without a culture ready for adoption and usage is pointless. A culture geared to innovation and collaboration doesn’t work if you have a distributed workforce and no technology to enable it. A technologically enabled, collaborative culture with these traits is too inefficient and risky without processes to tie them together and provide some form of governance.

Awareness Changes Behavior

The good news? You can overcome these detrimental aspects of decision making simply by being more aware of the mental process itself, and in turn actively counteracting it. Or to be more specific, you have to personalize your awareness by seeing yourself, or an individual you relate to, in those processes (statistics and reasoning alone don’t actually change behavior).

One way of doing that is by making the unfamiliar familiar. If a giant question mark exists when you think about the notion of ‘culture’ and how one might go about analyzing it then find material or people that help to simplify that for you. Perhaps culture initiatives feel like a barrier because you believe you aren’t empowered to change something so fundamental to the organization. That’s completely understandable, but it’s also not uncommon. Set up a call or workshop with us or someone else that deals with culture and change management, familiarize yourself with the approaches that can overcome this barrier and regain a sense of control.

Realize that allowing your mind to take these shortcuts of familiarity can and will set you up for failure in business. We wonder why people can understand all the facts, see all the statistics, know that they are likely to fail, and yet still make decisions that aren’t in their long term interests. We call them lazy, or stupid, or self-destructive. I would propose instead that in complex business decisions it is more often that they are in a battle between these two systems of thinking Fast and Slow that they don’t recognize is occurring. And Fast is winning.

A Final Thought

I would leave you with this thought; Try and think of an organization that failed because they didn’t implement a piece of technology. Now think of ones that had great technology but failed because their culture rotted them from the inside. Where should your priorities be?

As GI Joe would say, “Now you know, and knowing is half the battle”.

Cheers,

Matt Ridings – @techguerilla

Images via Kenny Stoltz & Shaheen Lakhan

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http://twitter.com/lirons Larry Irons

Hi Matt, I’m getting more and more skeptical about even using the concept of organizational culture to make the case for social business. In fact, at times I entertain the thought that organizational cultures do not exist. I wonder if what we think of as org culture isn’t really the way people get conditioned to bring their institutional affiliations, including things like the professions (HR, law, management, UX, engineering, etc.), to bear on working together. For example, managers don’t just insist on command and control merely because they think it is a more efficient way to get things done. They do so because that is what the prevailing management profession taught them in school, or what other managers who learned it in school (training courses, etc.) taught them. This way of using taken for granted knowledge is not so much value based, as a culture would be, but results from institutional relationships.

Just kind of thinking out loud here, but in a situation where connecting to, and managing participation in, ecosystems and networks are the key challenges, where does organizational culture reside? These are inter-organizational, network, challenges. If there is such a thing as org culture, how do the cultures of customers, business partners, and other key stakeholders ever get factored into the social business. I tend to think that every organization is an instance of individual people bringing institutional backgrounds to bear on the challenge of working together, of getting a job done (whether they are employees of that org, of a business partner, or a customer). Any thoughts on that?
- http://www.sideraworks.com/ Matt Ridings – Techguerilla
  
  We approach this from a few angles, and I think the approaches themselves will give you an idea of how we view culture initiatives.
  
  First, one way we view culture is an aggregate view. We analyze (through proven standardized question sets) dozens (and dozens) of cultural ‘traits’ that an organization possesses. The point in this case initially is to set a baseline, because as a cultural initiative progresses the intention is to modify the strengths of those various traits. But you need to be able to measure along the way to track progress, find what works, what doesn’t, and adjust to optimize. This approach is useful because you can apply different lenses (traits of full org, traits of individual departments, traits of working groups, etc.). It also allows you to focus initiatives at smaller levels and track against the larger org, or other segments, as a form of ‘control group’. This view is great for focusing efforts and measuring, but it sucks for actually designing plans themselves
  
  Second, is a more individualistic view. Let’s say one objective is to make an org more collaborative (a frequent item). Well ‘collaborative’ isn’t really what we attack, the notion of ‘collaborative’ is actually a broad series of segmented traits that requires tradeoffs in other opposing areas. At a simplistic level, you can’t increase collaborative traits without decreasing traits associated with control behavior. But to address that you can’t just attack head on, you have to drill into drivers of existing behavior and get to the core of the ‘selfish’ aspects. It’s only through resolving those aspects and personalizing the traits you want to change that you can bring it about.
  
  ‘Culture’ is an ephemeral term. For ‘change’ efforts we (SideraWorks) typically reduce to organizational traits. Those traits facilitate, or are caused by, various behaviors. The combination of those behaviors and traits tend to be rolled up into ‘culture’. It’s also relative. Using the terms that people focus on like ‘open’, ‘agile’, ‘transparent’, etc. are only useful in context. A ‘agile’ 5 person startup, and an ‘agile’ enterprise with 50,000 employees are judged very, very differently.
  
  Now, as you can imagine, if I increase complimentary traits in a group or organization and then layer some form of enablement (tech, etc.), it impacts the inter-organizational network challenges you speak of. It’s an overused word, but it really is an ecosystem.
  
  As an aside, when designing these things you’re absolutely right to have hinted around understanding network dynamics and how they evolve. You can see a bit of the work that we do there sneaking through in this presentation. http://www.slideshare.net/SideraWorks/social-media-to-social-business-expion-keynote-sept-2012
  
  Anyway, hope that helps.
  
  -Matt

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