Monday, March 10, 2014

Sometimes, A Blunt Instrument Will Do Just Fine

When we look to hire management talent for our companies we seek people who are “data-driven.”  When we launch businesses it’s critical to have high quality quant on market size and customer segments.  When we debate an important issue we insist on facts and figures.  In fact, we now live in a world of emerging "Big Data" where we struggle mightily to channel the volume, variety and velocity of information flows so as to improve our decision making.  
And yet, when it comes to the really big stuff, I sometimes wonder how data-driven we really are.
When I first wrote in 2011 about Ted Levitt's 1960 Marketing Myopia article (perhaps the single most influential marketing piece ever written), I remarked that it’s hard not to appreciate and occasionally invoke its lesson in conversation.  Levitt challenged leaders to define their businesses around the consumer, not their product.  “What business are we in?” was the essential question taught my business school class.  After all, we were informed, the customer in the hardware store does not really want a quarter-inch drill bit, he wants a quarter-inch hole.
Who wouldn’t want to drop that pearl of wisdom in a branding meeting?  It’s like hitting one of your misguided co-workers in the head with a blunt instrument.
However, a peek under the covers reveals that Marketing Myopia is just that--an extremely effective but still very blunt instrument.  
One of Levitt’s examples used to illustrate Myopia was the railroad, which he insisted stopped growing and lost share to autos because the rail fat-cats “assumed themselves to be in the railroad business rather than in the transportation business. . .”  It does not take a lot of research, however, to call this into question.  I posted a series of train ads here that showed the railroad doing head-to-head battle for passengers, from special dining and sleeping cars, to unique family vacations, to air conditioning, opulent furnishings, impeccable service, reduced noise, and a better ride.  Who do you think built the destination hotels in the country’s national parks?  Right: the clueless railroads.   And, by the way, rail was only competing against the automobile, arguably the most transformative innovation in America in the 20th century.

Likewise, Professor Levitt said, there’s the movie business.  When TV appeared, Hollywood should have found itself in the “entertainment,” not “movie,” business.   One wonders how much it would have mattered precisely what business Hollywood pretended it was in once the television was generally affordable and available to the American public.  (If a pro football team played and crushed a college football team, would we decide the college team could have done better had it decided it was in the business of “winning” instead of the business of “football.”)  Sometimes, I concluded, the fault is in the business definition; other times it’s just a question of overwhelming competitive advantage.  In any case, it would have been nice to find some well researched examples that actually supported the major premise of the piece. 
The funny thing, Professor Levitt admitted in 1975, was that when it came to the details of Marketing Myopia, “colorful and lightly documented affirmation works better than the tortuously reasoned explanation.” 
That is the very definition of the blunt instrument, the one that trades powerful if extremely fuzzy emotive understanding for inconsequential items like logic, data and truth.  

It is positive proof that the vast majority of us, despite our data-driven exteriors, really prefer emotional tidiness to intellectual tidiness.
I actually can't get this one to work, so if it turns out to be
something terrible, please let me know and I'll remove it.
It's not unlike those magic eye prints; if you inspect them carefully they make no sense, but if you cross your eyes and screw up your face and think about cosmic dust for a moment, the message pops right out.

If Marketing Myopia is one of the most famous blunt instruments in the business world, the most famous in American History is undoubtedly Frederick Jackson Turner’s Frontier Thesis.  In 1893, Turner claimed that the American frontier was the force most responsible for American democracy and individualism—the very thing that shaped the American character. 
Like Myopia, it is an idea that Americans just love, especially those who consider themselves to be trailblazers on the technology frontier.  (See here and here.)  However, also like Myopia, it wilts under inspection.  Turner’s thesis conveniently avoided a few other sea changes that also influenced American character: the rise of the railroad and concentration of capital in iron and steel, oil and coal, cattle and steamships; immigration; the migration from farm to city; the creation of a mass consumer market; the rise of unionism; the expansion of national interests in foreign territories (sparked by the Spanish American War in 1898); and the end of slavery.  Historians often criticize Taylor for giving too few supporting examples of his thesis, and relying too often on those he gave.   Historian Ray Billington wrote, "Actually, the legend of frontier individualism rested on what people thought should be true, rather than what was true.”  

Historian Richard Hofstadter said what so many others were thinking, calling Taylor's Frontier Thesis (and thereby titling this post) a “blunt instrument.”

Thomas Friedman’s “The World is Flat” is another enormously powerful blunt instrument which concludes that the world has become a level playing field in commerce.  

Is there anyone actually trying to run a business who believes this?  Friedman has been taken to task so many times--HBS Professor Pankaj Ghemawat: “Just a fraction of what we consider globalization actually exists”/Joseph Stiglitz: “Not only is the world not flat: in many ways it has been getting less flat”/Indian journalist P. Sainath: "It's not the ‘world’ that is flat, but Thomas Friedman’s ‘brain’ is flat.”—that criticizing “The World is Flat” has become a cottage industry.  It is, Billington might have said, what people would like to be true.
And yet.  True or not, Friedman and his flat world are oft-quoted and long in their impact.
The economics of Chris Anderson’s The Long Tail are highly suspect, though we adore this concept because it suggests the Web has solved a long-standing problem of the old, archaic business world.  The concept, correct or not, means we no longer can be blamed for buying all those slow-selling dogs in our inventories.  "'Dogs' to you,” we can now say with confidence, "are just part of our 'long tail' strategy to reach profitability.  Just watch Chris Anderson’s TED Talk and you’ll see.” 
In fact, some believe, TED Talks may be the preeminent workshop for the production and assembly of intellectual blunt instruments.  Each TED presentation forces sophisticated, often highly complex and nuanced ideas into a few minutes of happy, funny, choreographed talks with good illustrations.  It’s Cliff Notes for the 21st century.   Evgeny Morozov famously referred to TED Talks as the "kingpin of international meme laundering--a place where ideas, regardless of their quality, go to seek celebrity." 
And make no mistake, they do achieve celebrity, with millions of views.  TED turns lowly associate professors and journalists and starving authors into global celebrities and social media darlings.  

Because, we know, emotional tidiness really can trump intellectual rigor.  That is the secret of the blunt instrument.