David Matheson - SmartOrg, Inc.: Managing Change and Uncertainty: The Second Way

September 19, 2007

Managing Change and Uncertainty: The Second Way - Jim Matheson

Jamesmatheson1_2 On a recent drive, I listened to a CD on Chinese history, which discussed an interesting period of intense Buddhism in China. In brief, the Buddha concluded that people suffer because of their emotional attachment to their expectations about their situation, their relationships, their things, etc. When their situation changes in a manner that does not meet their expectations people suffer. In the Buddha’s view, all suffering is caused by unmet expectations—the cycle called Maya.

Is there a parallel in corporate culture? Companies and their investors have high expectations for continued growth and profitability. When there is a hiccup, heads roll, scapegoats are found, and new executives are forced to make promises – to set expectations – that they hope they will be able to keep. And “the cycle of suffering” continues.

The Path of Withdrawl

The Buddha said that to be free of suffering we must liberate ourselves from our attachments. In Chinese Buddhism this liberation took the form of renunciation and meditation. By the fourth century, large numbers of people had moved into monasteries and nunneries as a way of avoiding attachments. These institutions took so much land off the tax rolls, that later emperors banned them and confiscated their holdings. Unfortunately in the corporate world withdrawal is not an option. Individuals maybe able to withdraw to less stressful careers, but the corporate world continues. Even companies that have made spectacular crashes, such as AT&T, have a way of turning up again.

The Path of Engagement

For those of us who choose to live in and experience the world, particularly the business world, there is a second way I call the Path of Engagement. The key to this alternate path is avoiding the Buddhist trap of unmet expectations by not forming them in the first place. Along this path, we must embrace uncertainty and change. We must admit that we cannot predict the future and that change is inevitable.

Expectancy

Unexpected change provides us with exciting learning opportunities. If we come to expect change we need not suffer because of it. View unexpected change as a wonderful learning opportunity. Do not become attached to your expectations; rather, have high expectancy that interesting things will happen. Accept what you get and move on. Learn to love the surprises the world gives us.

Action Level

At the action level, do not expect that your predictions or desires will always come true. In the face of uncertainty, logic demands that we distinguish decisions – the actions we take – from the outcomes – what actually happens. For example, most people would agree that paying $1 for a 50% chance of winning $100 is a worthwhile investment, and of course the person making this investment desires the $100 prize. However, the investor knows in advance, at the time of the decision, that there is an equal chance of losing. If the investor (or the organization) gets emotionally attached to “winning” he has a 50% chance of suffering loss. If the investor understands that this is just one result of many, over a lifetime of investments, he just moves on to look for more good opportunities. He is confident that he made a good decision and does not worry because he cannot guarantee the outcome he likes. In more complex situations, the investor has an opportunity to learn from whatever happens and can take advantage of his new knowledge in making a future investment.

Managing Change and Uncertainty the Second Way

Expect change and uncertainty.
Separate decisions from their outcomes in your thinking and planning.
Do not focus on single forecasts, but vet sources of uncertainty and prepare for them. Do not ask for optimistic forecasts: ask for deep insight into the possible and the probable.
Investigate the sources of uncertainty and prepare for a range of outcomes. Do not regard preparation for events that do not happen as wasted: value the preparation for the events that do happen.
Avoid attachment to particular results. Be flexible and take advantage of what you get. Adapt to change: do not stay the course in the face of new circumstances.
Celebrate whatever happens and go on: do not wallow in the endless cycle of suffering.

References

Kenneth J. Hammond, From Yao to Mao: 5000 years of Chinese History, The Teaching Company, 2004 (CD)
David and Jim Matheson, The Smart Organization: Creating Value through Strategic R&D, Harvard Business School Press, 1998.

About SmartOrg

SmartOrg helps organizations pursue “the second way” by providing solutions for value-based decision making that embrace uncertainty and change. SmartOrg embodies these principles in advanced software and provides associated consulting to help organizations build new capabilities. See www.smartorg.com.

Posted at 02:55 PM in Value-Based Management | Permalink

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David Matheson - SmartOrg, Inc.

Value-based management

September 19, 2007

Managing Change and Uncertainty: The Second Way - Jim Matheson

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