The Illusion Of Expertise
When I was (much) younger, I believed that large multimillion and multibillion dollar companies were engines of discipline, efficiency, organization, and quality. How could they not be and still be as powerful and successful as they were? Then I went to work for one. And then I married someone who went to work for an even bigger one. And we discovered together that most businesses, in fact, succeed in spite of themselves.
In retrospect, this shouldn’t have been too surprising. No matter how large a corporation becomes, no matter what personal brand it acquires, the brand doesn’t run things—people do. And people, of course, are flawed (a fact I dissected in minute detail in a previous post, Your Neighbor Is An Alcoholic). I’d fallen prey to the mistaken assumption that people always try to do the right thing, are all basically competent, and that a book will be as good as its cover.
In fact, companies thrive on their customers assuming this. A good company will always strive for quality, but simultaneously strive with equal intensity for the appearance of quality. Because achieving quality and achieving the appearance of quality often require entirely separate efforts, it’s not uncommon for a large disparity to develop between the two. Think of Lehman Brothers, Bear Stearns, AIG, and all the banks now involved in foreclosure-gate. That it’s easier to look accomplished and professional than to be accomplished and professional is less a testament to how easy it is to look good than how hard it is to be good.
But companies themselves (and, by extension, individuals) not only choose “books” based at least partly on the quality of their “covers,” but in fact often struggle to justify to others (top management, board members, etc.) the choosing of “books” without good “covers.” Even when we know we shouldn’t be influenced by appearances, we are. So, for example, large companies rarely choose small companies as vendors. In fact, they rarely even interview them. The notion that Bank of America would choose a small, independent real estate professional to help them renegotiate an office lease is, at least to the executives responsible for selecting such a professional, almost ludicrous. One could certainly argue, perhaps even persuasively, that a small, independent real estate professional won’t have as much experience in dealing with the kinds of issues that come up in such large transactions as Bank of America would represent. But small, independent real estate professionals often come from large conglomerate real estate firms where they worked on just those kinds of transactions. They’ve lost none of their experience or skill in putting out their own shingle—just the appearance of it.
Of course this kind of pre-judgment isn’t fair. But even worse, it’s foolish. The quality of large companies often suffers because of their size, which is often directly responsible for daily errors and omissions of communication, for example. Further, the larger the company, the more responsibility for outcomes becomes diffused, often preventing any one person from feeling accountable for the quality of any one project.
How can we recognize and master our tendency to be fooled by glitter into thinking it’s gold?
- Recognize some effort to look professional does reflect professionalism. A true professional knows she can’t avoid marketing and makes a reasonable effort to look as professional as she is.
- Avoid falling prey to the idea that bigger is better. Bigger often adds complexity without improving quality.
- Call references. I’m continually amazed how often managers skip this step when hiring. Certainly, you expect the references to be good—otherwise they wouldn’t be offered. But a careful interview can uncover problems. Most people aren’t comfortable lying outright and will offer an honest analysis of a candidates weaknesses (albeit a sugar-coated one) when asked. Also, listen carefully to what a reference doesn’t say.
- Ignore any prejudices (your boss’s, co-worker’s, friend’s, and even your own) that try to hijack your own analysis. Relying on conventional wisdom stifles critical thinking. Be aware when pressure to hire a certain vendor or person is political or has more to do with how the vendor or person looks. Most bureaucracies are dysfunctional. The only reason work gets done is that people in key positions are not only good, but care about what they’re doing. The most critical factor for the success of any business is the people who work in it.
A part of us will always be influenced by fancy graphs, a good-looking face, a large balance sheet, a stellar reputation, and the opinions of others (no matter how unoriginal or automatic they may be). But such things only suggest quality. Maintaining constant awareness that the appearance and the presence of quality are two separate things, engineered in two separate (though hopefully related) ways, undoubtedly remains your best defense against allowing others to do your thinking for you and allowing yourself to be lulled into making what looks on the surface like a good choice but turns out to be far from it.
Next Week: Criteria For Screening
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Now that is a true story. Although what it has to do with Buddha I am not sure. He was a small time local fella after he quit being the king’s son but even then I think he was a small time up and coming king in his world. So he never was Goldman or Chase or who ever else is big and sloppy. If the Republicans were honest or bothered to look they would find as much waste in their beloved capitalism as in the not-so-beloved government.
Fake it ’till you make it, right?
I am part of a team of physicists doing basic research for Fermilab and it is amazing how for all the complex knowledge that goes into the work there, in some areas so little is known. I’d assume it is the same way with the corporate world, the financial industry being a great example. I think that’s why regulatory bodies are so important—the average person does not have the knowledge or time to really understand whether a company is legitimately good or just looks good.
Funny you mention Bank of America. I work for a small software company and they are one of our customers. They would probably never have looked at us were it not for the fact we developed an innovative product they need that no large software company can yet match. But BOA keeps expecting us to behave like a big company; our loose and freewheeling ways don’t look, to them, like a company that values quality—at least not in the high-process, auditable, buttoned-down ways with which they are comfortable.
In contrast, I once worked on a project to build a large government healthcare application. We had all the high-process, auditable stuff, and our government customer praised us high and low for how high quality our product was. In fact, we were only very good at the *appearance* of quality. That product was a buggy nightmare. The product my current scrappy little company makes is immensely more reliable and usable.
I think there’s a typo here. I had trouble understanding this sentence: “Recognize some effect to look professional does reflect professionalism.”
Do you mean “some EFFORT to look professional”?
Good post though.
I work for a large healthcare organization, big enough to employ the economies of scale—and thus support a hospital, among its many hospitals, that runs in the red because it serves the poor. Amen. Sounds like “doing the right thing.”
However, just as Alex says, the org is so big that individuals and individualism are lost and fall between the cracks because of its size.
Alex also makes the point about how difficult it is to think for yourself in a large org. I find that happens, as well—micromanagement may be one of the “chiefest talents” in my org.
I find myself longing for “small and scrappy,” as Jim so aptly put it above.
Here’s the money quote, for me: “Further, the larger the company, the more responsibility for outcomes becomes diffused, often preventing any one person from feeling accountable for the quality of any one project.” I’ve worked for several federal contractors over the last two decades; substitute “agency” or “government program” for “company” and you’ve got the epitome of our federal government. So much money is wasted because of this—it boggles the mind.