Steve Jobs. Warren Buffet. Don Draper. What do these legendary businessmen (two real, one fictional) have in common? According to Harvard Business School professor Andrew McAfee, they are business oracles, charismatic individuals who produce bold and often brilliant decisions largely by themselves.
Last time we checked in with McAfee, he was showing us how to send 100 Tweets in a day; more recently, he was waxing about the television show Mad Men, and its aforementioned central character, Don Draper. McAfee wonders if, thanks to new technologies, the business oracle might become a relic, much like the 1950s advertising world Mad Men portrays.
So what, exactly, are the traits of a business oracle? Among those McAfee discusses:
- Opaque: Oracles are unable or unwilling to discuss their decision-making process.
- My-way-or-the-highway attitude: McAfee writes, “Decisions by … oracles tend to be take-it-or-leave-it propositions, not subject to refinement.”
- Believe in one solution: Oracles may see customers as one homogeneous group, and believe in a one-size-fits-all solution.
- Individualistic: Group meetings aren’t a valuable place to gain insight for oracles, but merely a means to carrying out their plans.
McAfee sees these business oracles becoming less significant as customer-related technology improves. Among the breakthroughs he mentions are specialized advertising and marketing campaigns catering to different customer segments and websites that “read” the user and present information differently depending on how the user interacts with the site. He concludes:
The main problem with relying on old-school oracles to make important business decisions [is] the fact that they might be wrong. When you follow the advice of a Don Draper you’re making a big bet on a black box – you’re committing substantial resources based on a decision process that you don’t understand very well and can’t understand better. You’re just trusting in the oracle’s wisdom, and if he turns out to be not that wise you’re in trouble.
The takeaway from this? If your business relies on the gut decisions of a few powerful individuals, you may find yourself outperformed by those who employ a more rigorous and logical approach. However, McAfee is careful not to suppose that oracles will be obsolete in a few more years, but looks to the possibility of combining “insights from business oracles with other sources and methods, thereby making improved business decisions.”
Oracle image courtesy of Flickr user napalm filled tires, CC 2.0
