Tunnel vision results from tunnel focus

CorporateNature No 134

Taking a break can help break up tunnel vision; 
While exercise is best done on an empty stomach.

We've all been there. Working on a project, you encounter a seemingly unsolvable problem which drains all your mental energy. You get frustrated and take a break, grab a coffee and a snack or go for a walk. After the short break, you come back to the desk, start working again and then something miraculous happens. The solution to that tricky problem suddenly pops up in your mind effortlessly. It was almost as if there was no problem in the first place. What's that all about? 

TUNNEL VISION - TUNNEL FOCUS

When you are involved in focused mental work (studying, writing or any type of problem solving) your brain tends to zoom in on the task at hand. Most of your efforts go into trying to solve the issue you see "at the end of the tunnel", and there is no energy and processing capacity left for your brain to make sense of the full array of information available. At a certain point, when the amount of incoming information becomes too much for the brain to cope with, you become overwhelmed. The brain starts to falter.

EXERCISE COMPETES WITH DIGESTION

A similar process happens if you exercise on a full stomach:

"When you exercise, your body isn't using its energy for digestion. Instead, it slows any digestion currently taking place so it can divert as much blood as it can to feed your muscles and your lungs. If you've just eaten before exercising, you can experience gastrointestinal problems."

BREAKS & RETREATS HELP

Just as your body cannot digest food when you are exercising, so you cannot digest your thoughts and focus on the bigger picture while doing your day job. You need a break, a strategic retreat, a change of scenery. 

Albert Einstein famously played the violin whenever he encountered a problem while working on his theories. This activity gave his hands something to do and at the same time gave his brain a chance to relax, process the new information and see things with fresh eyes.

Keep this in mind the next time you're stuck on a particularly stubborn problem. The solution is very simple: take a break, change the pace, change the scenery, give your brain time to digest all that information. 

Aerobics
(image source: Wikipedia)

Three types of water taps resemble fiscal, monetary and microeconomic policy

CorporateNature No 133

Control is a fundamental concept in management and public policy. It is a continuous process of setting objectives and collecting feedback based on the results recorded in the implementation of these objectives. Ultimately, a well-functioning system of control is the key to long-term success.

There are different approaches to control, some more sophisticated than others. To illustrate these various levels of sophistication of control, let us look at an everyday metaphor: water taps.

1. Traditional British hot and cold water taps are separate:
Having hot and cold water coming out separately meant that you had to mix the water in your hands to get the right temperature, often risking scolding your hands under the hot water tap if you were unable to skillfully cool your hands with water from the cold tap at the same time. This anachronistic solution dates back to the time when the technology did not exist to separate the higher-pressure hot water from flowing into the cold water pipe if the two were connected inside the tap.

An example of such a slow-control system is macroeconomic fiscal policy, where the Government tweaks the tax rates but the results are only observed in the real economy a year or two later. The observed outcomes then inform policy, which can be adjusted in turn.

2. Old European taps mix the water but have two separate knobs:

The traditional tap familiar to most Europeans consists of a mixer and two separate control knobs for hot and cold water. Although the water comes out mixed, there is still some initial adjustment required to get the temperature right. This is a step in the right direction: the entire process is simplified, which cuts water waste and ensures a higher probability of getting consistent temperature every time. However, there is still room for improvement in the system.

An example of this system in the economy is Central Bank monetary policy. When a Central Bank reduces interest rates, the added liquidity takes about six months to work its way through the economy. 

3. Modern mixed tap with a single lever:

Modern technology allows using a single lever to set the exact temperature of a single flow of water. The modern tap saves time and keeps water waste to a minimum. This setup represents an efficient, streamlined system which allows for greater control over the whole process and guarantees an effortless experience and a consistently high standard for the user.

An example of this type of systems are the microeconomic decisions of company owners: the changes they adopt take a week to trickle down the organisational hierarchy.

4. Conclusion

If faced with the task of setting up a system of control, whether it be for personal or corporate purposes, consider the water tap metaphor. Or if you want to go a step further, follow the Chinese saying: 饮水思源 (yǐn shuǐ sī yuán) - when you drink water, think about its source. 

Water tap
(image source: Wikipedia)

Experts and Mammoths are prone to falling into traps and becoming extinct

Experts who specialise too deeply become less resilient. Mammoths who fall into deep traps tend to become extinct.
CorporateNature No 132

We live in times when deep specialisation is highly valued. Experts are traditionally associated with academia but the idea of knowing more and more about less and less (until you know everything about nothing) has also found its way into the corporate world. Yet, being an expert is not necessarily a good thing.

Many corporate jobs require an initial employee training period. These are usually designed to teach narrow skills that are mostly (if not only) useful in the employee’s current role. Thus the employee becomes an expert at their job, but for them to advance professionally, further training is required. This gives rise to a continuous process in which people specialise deeper and deeper in one area. Ultimately they end up developing narrow expertise in that area but very little else.

While deep expertise makes people more efficient at their job, becoming a narrow expert is a dangerous proposition. A narrow expert in a single area resembles a woolly mammoth that falls into a dug-out trap. If the trap is deep enough, the mammoth cannot climb out and ends up as steak on Neanderthal camp fires. Similarly, an expert developing a deep specialisations knows more and more about less and less. If they go too far down this path, they eventually end up knowing everything about nothing.

Wouldn't it be wiser and more resilient if we divided our energy and time and invested them in developing competence in multiple overlapping fields, rather than becoming a narrow expert in a single domain? Skills development benefits from diversification as much as an investment portfolio does. This would help keep the mammoth in the tundra, rather than in the trap dug out by our primitive ancestors.

Woolly mammoth
(image source: Wikipedia)

People of low ability are half-empty wine bottles that make the most noise

CorporateNature No 131

Ullage is the headspace of air between a liquid and the container holding that liquid. The ullage level is particularly important in winemaking, as too much ullage may lead to excessive oxidation which worsens the quality of the wine.

Minimising ullage makes the relationship between bottle and content more straightforward, or else a false impression about the whole package may be created. In the human world this has a parallel known as the Dunning Kruger effect: the cognitive bias of low-ability people to overestimate their abilities.

The Chinese have captured the Dunning-Kruger effect brilliantly in the expression 半瓶水响叮当 (bànpíngshuǐ xiǎng dīngdāng): "empty vessels make the most noise". Literally, this translates as “if you tap a half-empty bottle it makes a sound”. The metaphor here is that a person of low ability resembles a half-empty bottle: self-aggrandising and insecure executives are noticeably more noisy than the capable executives.

Philosopher Bertrand Russel put this even more eloquently:

“One of the painful things about our time is that those who feel certainty are stupid, and those with any imagination and understanding are filled with doubt and indecision.”

So can we try to make sure that our “ullage level” is always kept to a minimum? After all, nobody would like to open an expensive bottle of wine only to discover that its content has turned into vinegar.

Bordeaux wines with different ullage levels
(image source: Wikipedia)

Unintended Consequences: Cobras, College Grades, Potato PR

CorporateNature No 130

There are two types of unintended consequences:
1) The long tail of a probability distribution of outcomes, when the rare outcome happens to occur.

2) A chain of events that creates its own loop of consequences.

The previous CorporateNature blog post (No 129) was about some unintended consequences that occur in complex environments such as our human social systems, including the Peltzman Effect of risk-seeking behaviour when one is feeling safe.

Continuing this topic, here are three more examples of unintended consequences:

1. The Cobra Effect

The Cobra Effect is a case when an intended solution to a problem exacerbates the problem. The name "cobra effect" comes from a story from colonial India. To solve the problem of the large population of venomous snakes in Delhi, the British colonial government set a bounty for each dead cobra. At first this strategy was successful, as many snakes were killed for the reward. However, soon people started breeding cobras to profit from turning them in to the local government. The government eventually noticed it was being taken for a ride and scrapped the reward programme. This made breeders release the cobras they had been breeding into the wild, which led to an increase in the cobra population.

2. The Vietnam War & Grade Inflation

In the US, during the era of the Vietnam War in the 1960s, students with high grades were exempted from the draft for the war (conscription). This meant that giving someone a low grade could send someone to war, and possibly cost their life. As a result, professors became much more hesitant to give someone a C and gravitated towards handing out higher grades.

3. Potato PR

Potatoes were domesticated in South America some 10,000 years ago and were introduced to Europe after the voyages of Columbus. However, local European farmers and peasants did not take to them. Appreciating the nutritious potential of this new plant, Prussian king Frederick the Great came up with a public relations stunt to convince people that potatoes are worth it. He had his servants plant a field of potatoes and stationed a heavy guard tasked with pretending to be guarding the field. Naturally, the local peasants assumed that the crop on the king's land must be valuable and started to sneak into the field and steal potatoes for their own gardens. This had exactly been Frederick's intention and the mission was accomplished exactly because the peasants thought their stealing of potatoes was an unintended consequence.

Indian cobra
(image source: Wikipedia)

Human systems are rife with unintended consequences

CorporateNature No 129

As the name suggests, the sociological term “unintended consequences” refers to unforeseen  outcomes of purposeful actions. They occur in complex social systems due to the large number of variables involved in the functioning of these systems.

In the simplified world of Newtonian physics, for every action in nature, there is an equal and opposite reaction (Newton's 3rd Law of Motion). In such a system, outcomes are easy to predict.

In contrast, human social systems are complex, sometimes bordering on chaotic, so the action-reaction equation does not necessarily hold true. More often than not, there are unintended consequences.

A classic source of unintended consequences is the Peltzman Effect. The Peltzman Effect, or risk compensation, occurs after the implementation of safety measures intended to reduce injury or death (e.g. bike helmets, seat belts, etc.). While people may feel safer than they really are, they take additional risks which they would not have taken without the safety measures in place. This may result in an increase in mortality, rather than the decrease that was initially intended.

Here are some examples of the Peltzman Effect:

1. Anti-lock brakes

Anti-lock brakes were introduced in Germany in the late 1970s. Contrary to government expectations, instead of decreasing fatal car accidents by 10-15%, the drivers of cars fitted with anti-lock brakes became more likely to engage in risky driving. Studies found that drivers would trust their new braking technology too much and as a result would curves at a higher speed, which increased rollovers and accidents.

2. American football helmets 

Helmets became mandatory in American football in 1943 and the risk of injury was expected to go down. Indeed, the helmets decreased the number of broken noses, teeth and jaws. However, concussion and spinal injuries actually increased and broken necks saw a staggering rise by 400%. The reason for these counterintuitive statistics was the better protection that helmets gave to players, so the players actually started using the helmets as an offensive weapon, just like battering rams.

3. Airbags and children left in cars

Airbags are another pertinent example of the Peltzman Effect. Passenger-side airbags were intended to increase safety but actually started hurting and killing child passengers as children were vulnerable to being hit by a deploying airbag during a collision. This led to the child seat being moved to the back of cars, which in turn resulted in another unexpected consequence: an increase in the number of babies and children inadvertently left behind in locked vehicles.

1959 Volvo 122, the first mass-produced car with seatbelts as standard equipment
(image source: Wikipedia)