Take a disaster and deconstruct it step-by-step. You’ll often find a series of small, seemingly innocuous actions that eventually boiled over into chaos — like the butterfly’s flapping wings that created atmospheric changes causing a hurricane.
The economic crisis may be the result of such a cascade of chaos, and thus serves as a great lesson for managers who need to understand how their projects can go awry.
New York Times writer Charles Duhigg, writing in the HBS Alumni Bulletin, says that too many decisions leading up to and around the economic crisis were made based on unquestioned assumptions such as, “It’s a good idea for everyone to own a home.” Worse, key decisions such as the government’s plan to invest in banks rather than remove their toxic assets were made quickly and with little debate.
“I’ve spent a lot of time asking people why some of the most important decisions received such little discussion. Here’s the most convincing answer, repeated by politicians from both parties and players all over Wall Street: When a crisis like this one first appears, it’s obvious only to a handful of people. And the steps required to snuff it out are onerous, painful, and radically unpopular among the masses, who don’t realize how bad things are about to become. So, in the words of one very senior policymaker, ‘we must wait for a widespread panic to solve the political obstacles that are preventing us from acting.’”
Question Authority
This spiraling of unintended consequences is an important lesson for managers to learn. You may be sowing the seeds of project failure even in your very first kick-off meeting if the project is based on unchallenged assumptions. Keep asking questions. Will IT really be able to commit the resources in July that they pledge? Does Marketing really have the necessary understanding of the new consumer segment we are targeting?
I think back a dozen years ago when a new computer company was developing a user interface built on voice recognition. The technology worked brilliantly. But the engineers behind the plan should have challenged one of their basic assumptions that they could sell this product to corporations. Many people think the Star Trek notion of commanding hardware by voice is great stuff — until you realize that, in an office environment, a whole bunch of people talking to their computers is terribly distracting.
Do you have examples of small steps cascading to big problems? Of products killed because they were built on the wrong assumptions?
