What Stops Organizations From Breaking the Status Quo

(and How To Fix It)

In 1928, American sociologist William Isaac Thomas theorized, “If men define situations as real, they are real in their consequences.” In other words, a consequence will come to fruition based on how one interprets the situation. This concept came to life only a few years later, with the fall of the banking system during the Great Depression.

Between 1931-1933, those banks that were on strong financial footing were driven to insolvency by bank runs. Often, a false rumor started that a bank was insolvent (incapable of covering its deposits), a panic ensued, and depositors wanted to withdraw their money all at once before the bank’s cash ran out. When the bank could not cover all the withdrawals, it actually did become insolvent. Thus, an originally false belief led to its own fulfillment.

We have seen this pattern continue to repeat itself even in today’s climate, where under just the right (or wrong) conditions, inaccurate social stereotypes can lead to their own fulfillment. For example, individuals stereotyped as more intelligent, competent, or likable can actually become more intelligent, competent, or likable than others stereotyped as less intelligent, competent, or likable. Thus, one can perpetuate not just the stereotypes themselves but the inequalities that give rise to those stereotypes.

This also crosses over into organizational culture and behaviors alike. Organizational leaders often can easily identify areas in the company where improvements or major changes are needed. However, they frequently expound a litany of reasons why the change can’t be made and would inevitably fail. Typically, it’s that it hasn’t worked in the past, seen as too difficult, or requiring too much time and resources to implement. So even though the need is identified and discussed year over year, the organization fails to enact change.

This mindset is what psychologists term as a self-fulfilling prophecy or a process through which an originally false expectation leads to its own confirmation. By having the mentality that enacting the change won’t succeed, the belief perpetuates the outcome. Therefore, many organizations thwart their own success simply because of their preset perceptions and expectations.

We conducted a study in Q2 2020 with our clients about their knowledge of their customers’ needs. Out of 50 CEOs, almost 60% of respondents stated their organization understood their customer’s goals and objectives “very well” or “extremely well”. However, 43% said the most important thing their organization needed to better understand is “customer goals, needs, and objectives.”

This dichotomy suggests the belief that customers’ needs are understood is inhibiting any changes which would improve that understanding. While over 42% of respondents stated customer input was captured on a “daily” or “weekly” basis, the majority felt their organizations couldn’t gain better insight due to limitations in technology, budget, organizational culture, and internal communications. In short, because the perception that customers were well understood, most CEOs didn’t see a need for change, despite the fact customer insights were their number one challenge, and over 50% said they used this information to make strategic business decisions.

The most compelling question is how we can overcome this mental bias to help pave the way for needed change. Our experience with organizational leaders has uncovered a simple behavior shift that can help propel teams out of change stagnation – Action Learning.

Not to be confused with Active Learning, Action Learning is a problem-solving and change methodology involving participants taking actions, and reflecting upon the results. Leaders work and learn simultaneously by tackling real business issues with real consequences. It is based on the idea that to increase your impact as a transformational leader, you need to learn by living the theory in real working environments, rather than basing decisions on existing perceptions, or just receiving knowledge from others and then struggle to apply back at the workplace.

During an effective Action Learning program, a team of learners will typically find themselves having to examine and understand the issue (the ‘real’ problem), identify potential solutions and actions to be undertaken, and finally to reflect on and exchange ideas about the learning process. The goal is to diffuse existing stigmas, diminish risk aversion, develop an immersive knowledge expansion environment, and increase participants’ exposure to new concepts and ideas.

The key factors needed to run a successful Action Learning program include:

  • A project defined by the group in response to a need or theme identified by the organization.
  • A high-level sponsor, relevant subject experts, and a coach to support the group’s development.
  • A balance between individual learning value and strategic value for the organization.
  • An experienced facilitator who is not too interventionist or hands-on; challenges represent important learning opportunities.
  • A sufficiently complicated and complex project/challenge which allows each member of the group to develop.
  • A highly diverse group that takes responsibility for peer-based learning.
  • Roles and responsibilities are distributed in such a way that each participant is encouraged to develop.

Do you know why the Wright Brothers beat out all the mega-corporations they were competing within the race to taking the first flight? Action Learning.

Action is cheaper than planning. The Wright Brothers had a tight budget and were forced to make small, cheap tweaks to each model. They would fly a plane, crash it, tweak it, and fly it again quickly. They learned by doing, learned from each other, and didn’t obsess about obstacles. The Wright Brothers had a hundred test flights in the time it took the big corporations to complete a handful. Every test flight taught lessons – and each time they gathered more information.

Action Learning creates possibilities that didn’t exist before. We always look at the future from the place we’re standing. Yet we forget that this is only one spot. Imagine walking in New York City. All you can see are skyscrapers, traffic, and taxis. You turn down the next street and you’re looking across the trees of Central Park. A completely new possibility has emerged. Possibilities that seem to “come out of nowhere” actually come out of action.

If an organization believes change isn’t possible, that belief becomes reality and obstructs any possibility of success. Whether it’s challenging the status quo or developing a groundbreaking innovation, it’s clear that change won’t occur without a shift in mentality. To do this effectively, you have to make Action Learning a part of your culture. It isn’t simply a new initiative, but a fundamental transformation of organizational behavior. By disrupting the self-fulfilling prophecy mindset, you can create an unencumbered path for change – more importantly, for those long-needed changes which may benefit your organization in more ways than one.

“The truth that one truly believes is in action.” – Bayard Rustin
About the Author

Andrea Olson
Andrea Olsen

Andrea Olson is a speaker, author, behavioral economics, and customer-centricity expert. As the CEO of Pragmadik, she helps organizations of all sizes, from small businesses to Fortune 500, and has served as an outside consultant for EY and McKinsey. Andrea is the author of The Customer Mission: Why it’s time to cut the $*&% and get back to the business of understanding customers and No Disruptions: The future for mid-market manufacturing.

She is a 4-time ADDY® award winner and host of the popular Customer Mission podcast. Her thoughts have been featured in news sources such as Chief Executive MagazineCustomer Experience MagazineIndustry Week, and more. Andrea is a sought-after keynote speaker at conferences and corporate events throughout the world. She is a visiting lecturer at the University of Iowa’s Tippie College of Business, a TEDx presenter and TEDx speaker coach. She is also a mentor at the University of Iowa Venture School.

More information is also available on www.pragmadik.com and www.thecustomermission.com.

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