“Obscure and pregnant with conflicting meanings”

We’ve all heard the cliché “hindsight is 20/20” a thousand times. And it’s pretty much true. It’s a lot easier to figure out the path to a particular event when you know the final outcome. But if “what happened” is something bad, determining the reason after the fact doesn’t change the negative event.

How can we do a better job finding those problems in advance of our next new strategy implementation, site redesign, store remodel or other big effort?

It’s worth digging a little deeper to better understand why our hindsight is so perceptive. One of the most famous cases of 20/20 hindsight comes from the investigation into the attacks on Pearl Harbor (although, we could also argue the investigation into 9/11 and the more recent Fort Hood shootings have many similarities). In her book Pearl Harbor: Warning and Decision, noted military intelligence historian Roberta Wohlstetter wrote “it is much easier after the event to sort the relevant from the irrelevant signals. After the event, of course, a signal is always crystal clear; we can now see what disaster it was signaling since the disaster has occurred. But before the event it is obscure and pregnant with conflicting meanings.”

Of course, Pearl Harbor was an unexpected disaster that seemingly came out of nowhere. While we have those occasionally in business, more often than not our “disasters” come from strategies, redesigns or promotions that did not perform as expected. And those expectations can also lead to our blindness.

Whenever we’re implementing some new and exciting strategy, we tend to be very optimistic about the results. We’re convinced these new strategies are going to provide positive returns or we wouldn’t be implementing them. That optimism can lead to the same sort of crystal clear signal Wohlstetter referenced, but in the opposite direction; i.e. we tend to only see how everything we’re doing will lead to greatness and can easily overlook variables that have potential to lead to negative outcomes.

So, what do we do about it?

It seems some of the most common solutions today involve pulling together a committee to review what went wrong and putting together processes to prevent those specific problems in the future. These new processes don’t prevent all potential problems in the future, but with any luck they’ll prevent us from repeating the same mistakes.

But all of that happens after the fact.

There’s got to be a better way. My problem with the “committee and new process” approach is there’s a tendency to introduce lots of new and –all too often — needless bureaucracy. Inefficiencies ensue without greatly decreasing the probability of problem-free future efforts.

A technique I’ve found effective invokes much of the clarity of hindsight by drawing on the power of imagination.

During the ROI process for the strategy or project, we’ve already imagined the positive outcome. So before we wrap up planning, let’s also imagine a couple horrific scenarios. For example, imagine that four or five months after a site redesign, sales are down 50% and customer satisfaction has tanked. What happened? Now let’s assemble the same type of committee we would in that scenario and pour over the plan to find the causes of our imagined disaster.

Some might say this technique is really just standard contingency planning, but I find some pretty big differences. Contingency planning tends to look at the current plan to identify execution risks. It doesn’t often uncover key strategic or design problems.

The Scenario Imagination technique provides us with a different sort of lens that taps into our hindsight abilities to separate the signal from the noise.

We certainly won’t find every potential problem, but every problem we mitigate increases our probability of success and reduces our risk. And if we can reduce a lot of risk without strangling ourselves in bureaucracy, we’ll likely lower costs, increase efficiencies, and increase profits. I like the sound of that.

What do you think? Have you run into these types of issues? Do you think this technique would work for you? Do you have any techniques you would like to share?

Photo credit: me’nthedogs

5 Comments

  • By Kasey Lobaugh, December 16, 2009 @ 4:16 pm

    Thanks Kevin for another insightful blog posting. My own experience says that there may be another element that is often times missing in an organization, and that is continual business case monitoring.
    My experience says that organizations tend to develop a business case to get initial funding, but once that is done, the business case goes on the shelf. But immediately, things begin to change. Scope changes, assumptions prove incorrect, timelines change, costs overruns occur, but the business case is seldom managed as a living thing by which organizations continue to make decisions.
    Just as important as risk management (contingency planning), and scenario imagination are, I would add on-going business case management to the list.
    Reading your article brings a specific incident to mind where a client of mine said ‘Why do we have to keep talking about the risks, it just brings everyone down!’
    Kasey Lobaugh
    Multi-Channel Retail Practice Leader
    Deloitte

  • By Kevin Ertell, December 16, 2009 @ 4:55 pm

    Excellent points, Kasey, about maintaining the business case. Certainly, things change both internally and externally during the life of a project, and those changes can absolutely affect the original business case. I really appreciate you adding to the conversation.
    Also, funny comment at the end. I laughed…and I cried. 🙂

  • By Chris Eagle, December 18, 2009 @ 2:07 pm

    This strikes me as being related to your article on why Amazon can innovate. Many companies ONLY look at the upside, or perfect scenario. Even when they do contingency planning it’s only something that really won’t happen and they only go through the empty motions. And when they deal with the problem that the dog got out, they generally only put in changes to stop the dog from getting out, not to prevent all of the other things that could happen because the door was open and unattended.
    I have been involved with many companies where every project was planned to have a 90% chance of best case scenario and a 10% chance of almost-best-case scenario, and then got upset whenever the project didn’t meet those goals. Worse yet, they often spent to those projections and then ended up hemorrhaging money because they didn’t get the projected return.

  • By Kevin Ertell, December 18, 2009 @ 7:46 pm

    Thanks for your comments, Chris. It’s easy to get so optimistic on big projects that you lose site of the problem. Certainly, planning a 90% probability of success can cause some blindness to fairly obvious problems. And your point about spending to unrealistic projections is a good one. Thanks again for contributing to the conversation.

  • By John H, December 24, 2009 @ 9:02 am

    I really like your ideas about Scenario Imagination. I can see how they would help us all do a better job finding problems in our plans. I’ve got some major straget planning going on in January, and I’m going to try this technique out with our team. Thanks for the great idea!

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Retail: Shaken Not Stirred by Kevin Ertell


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