Nick Bostrom, a philosopher from Oxford, and Elon Musk, everybody’s favourite example of an entrepreneur these days, both seriously seem to believe we are living in a computer simulation like the one in the film, The Matrix.

I think they’re bonkers. But that doesn’t mean I disagree with the idea that we live in a world of illusion. Businesses as well as individuals have to strive to remain in contact with reality – or else.

When I became a consultant, the first lesson my mentor taught me was to be mindful to deal with “observable behaviour and evidence in the environment.” It’s wise advice for all business people, indeed for anyone called upon to problem-solve and decide in situations where hearsay and mistaken beliefs can send you in the wrong direction.

And it’s very easy to get caught up in convincing illusions.

One morning, while walking in the park near where I live, I saw a magpie standing on the grass. Nothing unusual in that – they’re very common in that park. What was unusual was that as I got nearer to it, it transformed into a shiny black bin bag! The effect was so striking that I laughed out loud at the trick my mind had played.

A psychologist might explain that perception is largely constructed from a mixture of memories and expectations. I expect to see magpies in the park, and so given a plausible signal, I saw a magpie.

This then got me wondering: what if I hadn’t got close enough to discover the bin bag? I would have known that I had seen a magpie, for sure. And yet I would have been completely mistaken.

And there’s another layer of illusion once you consider the effect of beliefs. In England at least, the number of magpies one encounters is the subject of superstition. This is captured in the rhyme: “One for sorrow, two for joy, three for a girl, and four for a boy.” So if I were superstitious, I wouldn’t just have seen a bird, I’d have seen an omen!

Maybe this would colour the rest of the day. I’d see innocent coincidences as threats. Maybe I’d overlook opportunities, dismissing them as too good to be true. Maybe I’d dwell on perceived weaknesses in myself and others, while disregarding strengths.

What are some of the convincing illusions business people can get caught up in? Well, for example, that:

  • Their customers are only interested in price (but they’re often not).
  • Generation X, Y, Z want everything on a plate (but they often don’t).
  • Customers won’t pay more (but they often will).
  • Their products are average but it doesn’t matter because “our service is excellent”. (customers turned out to think their service department was arrogant and uncaring).
  • What gets measured gets done (yet what gets measured often gets gamed).

These illusions are convincing: they seem real!

All of us can get caught out by this stuff. That’s why we need ways to escape the bewitching effect of what we think we know.

Andy’s Advice: Don’t rely on weak signals which seem to substantiate ‘what everybody knows.’ Insist on observable behaviour and evidence in the environment.

 

 


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