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The Hands off IIMs Movement


Do You Want to Sell More? Cut Costs? Best Your Competition?




A  'Satisficing'  Solution

Originally published in Businessworld. India's largest-selling business magazine.

      We were once working with a highly respected organization, in one of the newer divisions that had been set up a few years previously. The manager leading this division -- let us call him Suresh -- had successfully built it from scratch. But the division suddenly started experiencing problems, dropping sales and customer satisfaction among them.

During our first meeting with Suresh, one of the things we gathered was that he was very proud that they were a “happy family” in the division. On meeting his subordinates, we got conflicting signals about the state of cohesion in the team. One of his deputies, considered a high-potential manager and recently posted to this division, mentioned that he had asked the corporate office to move him out prematurely, even though it would have adversely affected his career prospects in the company.

As we went into more details, it became progressively obvious that the issues the division was facing had less to do with the environment or the numbers, which we thoroughly crunched to make sure, but with Suresh’s leadership style. When he started building the organization, he followed an individualistic and directive style, where most of the decisions were taken by him -- and was appropriate for the evolutionary stage the organization was in. When we met Suresh and his team, the business had reached a steady state and required a delegative leadership approach. However, Suresh continued with the style he had followed for a long time and, hence, was more comfortable with. The nature of the organization changed, but his leadership style did not.

To cut the story short, once Suresh moved to a similar position where he had the opportunity to build something new again and another manager brought in to replace him, everything again fell into place and growth resumed its normal trajectory.

There was nothing wrong with Suresh, or his management style. It was just that the right man in the right place, with time, became the right man in the wrong place. More importantly, the solution, at first sight, had nothing to do with the symptoms.

You go to your doctor because you have a headache. Without questioning you thoroughly about your symptoms or developing an understanding of your lifestyle, he tells you to “take two aspirins twice today and drop by again tomorrow”. Will you follow his advice?

Yet such advice is routinely dispensed and acted upon in the corporate world. To go back to the example of Suresh, a lot of paper could have been used up in suggesting ways of increasing sales or improving customer satisfaction, but that would have only been addressing the effect, not the cause.

But more often than not, most managers do precisely that. They focus on the visible issues and not the factors that caused the problems in the first place. Not that they can’t get to the bottom of things. Because they are busy fighting so many fires simultaneously, fixing up a problem for good will take them away from attending to other issues which too are competing for their attention. The practical thing is to find a satisficing solution to get the problem off their back, and move to the next crisis. (Satisficing, a term coined by Herbert Simon, is a cross between ’satisfying‘ and ’sufficing‘. It refers to the fact that when human beings are presented with numerous choices, we usually select the first reasonable option, rather than the best one available).

Often insights result from what is not present, than merely from what is. To illustrate from a Sherlock Holmes exploit: In the story ‘Silver Blaze’, Holmes investigates the mysterious disappearance of a horse that had been widely tipped to win an important race. Someone stole into the stable and snatched the horse, without alerting the guard dog.

During the investigation, Inspector Gregory asks Holmes: “Is there any other point to which you will like to draw my attention?” Holmes says: “To the curious incident of the dog in the night-time.” Inspector Gregory retorts: ”The dog did nothing in the night-time.” And Holmes says: “That was the curious incident.”

Holmes deduces that it was an insider-job, the abductor must have been someone the dog knew well. Finally, it turns out that the horse’s trainer was responsible.

To offer a real-world example, recently a high-end Indian retailer discovered through store sales data analysis that womenswear sales shot up over the weekends. The cause is a no-brainer; more families visited the stores during this period. But, looking at it from another angle, the key insight was: Teenagers stayed away when families were around. Subsequent analysis of teenage sales and footfall data confirmed it. And the placement, promotions and pricing were adapted to take advantage of this revelation.

Managers have problems to solve and are always under pressure to get things done. They do not get the time to probe beneath the surface to try and develop an understanding of the key variables and their inter-relationships. The focus is on short-term fixes to paper over the cracks than on identifying root-causes and instituting processes to solve, and eventually, prevent problems. This managerial ‘Problem Portfolio’ unfortunately ensures a satisficing solution for tackling the red flag indicators. 

But the most important question is: Are you doing it too?

©2005, All rights reserved with Anoova Consulting

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This article was originally published in Businessworld, in Wide Angle, the monthly guest column by Mohit Malik of Anoova Consulting’s Strategy and Leadership Practice.

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This article can also be accessed at the Businessworld website. Businessworld. India's largest-selling business magazine.

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