Why Bad Ideas Refuse To Die

When I was 27, I moved to Warsaw, Poland to work in the nascent media industry that was developing in the wake of the fall of the communist regime. I had some experience working in media in New York, so I was excited to share what I’d learned and was confident that my knowledge and expertise would be well received.

It wasn’t. Whenever I began to explain how a media business was supposed to work, people would ask me, “why?” That forced me to think about it and, when I did, I began to realize that many of the principles I had learned and taken for granted were merely conventions. Things didn’t need to work that way and could be done differently.

Yet I would never have known that if I had stayed in New York. Surrounded by people who thought like I did, my ideas about “the way things work,” would have never been questioned, but constantly reinforced. That’s why it’s so easy to get disrupted, because we get locked into bad ideas embedded in our networks and aren’t able to shift away from them.

Cultures Of Genius

In 1997, three McKinsey consultants published a popular book titled The War for Talent, which argued that due to demographic shifts, recruiting the “best and the brightest” was even more important than “capital, strategy, or R&D.”  The idea made a lot of sense. What could be more important for a business than its people?

Yet as Malcolm Gladwell explained in an article about Enron, strict adherence to the talent rule contributed to the firm’s downfall. Executives that were perceived to be talented moved up fast. So fast, in fact, that it became impossible to evaluate their performance. People began to worry more about impressing their boss and appearing to be clever than doing their jobs.

The culture became increasingly toxic and management continued to bet on the same failed platitudes until the only way to move up in the organization was to undermine others. As we now know, it didn’t end well. Enron went bankrupt in 2001, just four years after “The War for Talent” highlighted it as a model for others to follow.

Mary C. Murphy’s new book, Cultures of Growth, helps explain why “The War for Talent” is such a bad idea. It assumes that talent is innate, rather than something to be developed. So people who are considered to be “A players,” are given lots of latitude. Their ideas are rarely questioned and others are expected to fall in line. She calls this a “Culture of Genius.”

In Cultures of Growth, on the other hand, it is learning that is valued. That’s what I found in Poland. People there didn’t take for granted that they knew what a media market is supposed to look like, so it was a great environment to experiment, take risks, explore new possibilities, learn new ideas and put them into practice.

The Rule-Following Paradox

The philosopher Ludwig Wittgenstein famously wrote, “no course of action could be determined by a rule, because every course of action can be made out to accord with the rule.” He meant that every rule is subject to some interpretation and, given shifting contexts, interpretations are bound to vary.

It’s not hard to see how this rule-following paradox plays out in different cultures. In a Culture of Growth, rules are imperfect but can evolve and adapt as the organization learns more. In a Culture of Genius, however, rules are associated with power and are molded to serve those who have it.

Let’s go back to my situation in Poland. I had developed certain ideas about “how things work” from the “rules” I learned though training and experience. My performance was evaluated based on my ability to act in accordance with those principles. It was only when I entered a completely different environment that I saw that things could be different.

So it shouldn’t be surprising that many media companies found it hard to adapt when the Internet came around. Those in power had succeeded playing according to pre-digital rules and prided themselves on how they mastered them. Others got rewarded for internalizing those principles and punished if they failed to abide by and act on them.

Embedding Ideas In Networks

Organizations are not islands, but are part of a larger ecosystem of partners, suppliers, customers, communities and other stakeholders. In Why Information Grows, MIT’s Cesar Hidalgo explains that more complex ecosystems create more value, because they enable a greater density of ideas and “crystalized imagination.” The same principle works for people. How they are connected will greatly affect how they perform.

In 2005, a team of researchers decided to study why some Broadway plays become hits and others flop. They looked at all the usual factors, such as production budget, marketing budget and the track record of the director, but what they found was that the most important factor was the informal networks of relationships among the cast and crew.

If no one had ever worked together before, both financial and creative results tended to be poor. However, if the networks among the cast and crew became too dense, performance also suffered. It was the teams that had elements of both, strong ties and new blood, that had the greatest success.

The same effect has been found elsewhere. In studies of star engineers at Bell Labs, the German automotive industry and currency traders it has been shown that tightly clustered groups, combined with long range “weak ties” that allow information to flow freely among disparate clusters of activity, consistently outperform close networks of likeminded people.

Or, as one author put it, transformational change always involves small groups, loosely connected but united by a shared purpose.

Shaping Networks And Ecosystems

I recently read David Sanger’s new book, The New Cold Wars, which was excellent in many ways. It was very well sourced, often insightful and excellently written. It was also riddled with relatively minor errors.  These didn’t really affect the story he was trying to tell, but they were annoying and undermined an otherwise excellent book.

What probably happened is that the fact checker was intimidated by Sanger’s prominence and didn’t call him out or didn’t bother checking facts that, truth be told, are not really his area of expertise. (Being much less prominent, my fact checkers didn’t have the same reluctance with my books). So the errors persist and Sanger looks a little bit silly.

What’s important to understand is that, in the publishing world, someone like David Sanger isn’t just a person, but a powerful ecosystem, which includes his agent, his editor and a number of other people who depend on him to make a living. If they see those relationships being threatened, they will tend to lash out. So you can sympathize with a low status fact checker being intimidated.

The thing is, as Annalee Saxenian explained in her book Regional Advantage that chronicled the rise of Silicon Valley, the tech giants in Boston that reigned in the 60s and 70s, built very insular ecosystems and were unable to adapt when things changed. Silicon Valley, on the other hand, built much wider networks in which information flowed much more freely. The rest, as they say, is history.

We get to choose what types of networks we build. We can build networks of control, in which power determines truth. Or we can build networks where information flows freely and new ideas can take hold, grow and cascade to where they can create the most value. Those choices will determine whether new ideas can gain traction and take hold or bad ones persist.

Greg Satell is Co-Founder of ChangeOS, a transformation & change advisory, an international keynote speaker, and bestselling author of Cascades: How to Create a Movement that Drives Transformational Change. His previous effort, Mapping Innovation, was selected as one of the best business books of 2017. You can learn more about Greg on his website, GregSatell.com, follow him on Twitter @DigitalTonto, his YouTube Channel and connect on LinkedIn.

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