9 of 9 people found the following review helpful:
4.0 out of 5 stars
How to Resist the Enthralling Siren Song of Denial, March 15, 2010
This review is from: Denial: Why Business Leaders Fail to Look Facts in the Face---and What to Do About It (Hardcover)
Richard Tedlow rises up to the challenge of dealing with the attractiveness of denial in the business world and how to successfully overcome it. As Mr. Tedlow puts it, denial consists of ignoring the obvious because there is no will to confront it. Denial has an irrefutable appeal because it can be rewarding in the short term. In contrast, denial rarely works in the long term in the business world (pp. 2-3). Resisting denial is not an all-or-nothing proposition that can be dealt with thoroughly once and for all with success. Denial-avoidance is a life's work for all individuals and organizations (pp. 204-206).
In the first part of his book, Mr. Tedlow convincingly demonstrates that companies that were once (very) successful can fall prey to denial, sometimes resulting in their loss of market supremacy. Think for example about the substitution of General Motors to Ford Motor Company in pole position in the 1920s, or the disastrous formula change of "Classic" Coke to better deal with the Pepsi Challenge in the 1980s. In the second part of his study of denial, Mr. Tedlow shows that after first agonizing over the necessity to change their modus operandi and/or business model, some companies such as DuPont and Intel made the necessary decisions to overcome a major crisis, at what Intel CEO Andy Grove calls a strategic inflection point in their existence (p. 58).
To avoid the fate of those who succumb to denial in the business world, Mr. Tedlow concludes his examination of denial with the following action plan:
1. There is no time to waste in dealing with denial. Tackling denial at a time of a crisis will often be too late.
2. Avoiding denial by unflinchingly facing facts is the alternative to ignoring, dismissing, rationalizing, or twisting these facts in the vain hope to make them less brutal than they really are.
3. Cultivating "Cassandras" (most often middle managers) instead of yes-men is in the best interest of the leadership. Unfortunately, this antidote to groupthink is rarely practiced, despite its "near-universal" praise.
4. The top management has to clearly signal that it is both able and willing to listen to what is not the party line and most flattering to them. Cassandras will eventually leave organizations that silence them. Furthermore, firing the messenger because the truth is not welcome within an organization will exact its price sooner or later.
5. Facing denial with success requires a long-term perspective. As the author rightly puts it, the current economic downturn is the textbook illustration of how denial goes hand in hand with short-term thinking.
6. Watching one's vocabulary is a reflection of one's power to resist denial. For example, trash-talking the competition without merit, or using politically correct language to avoid calling a spade a spade, mirror self-delusion.
7. Telling the unvarnished truth can do what the "experts" think is impossible to accomplish. The comeback of Tylenol from the abyss shows the power of what Mr. Tedlow calls "data-driven emotional intelligence." This lesson will give pause to more than one lawyer or PR person in charge of crisis management.
8. Finally, the people who prove the best at resisting denial are unconventional thinkers who need to be cultivated instead of being ignored at the peril of their organizations (pp. 205-216).
As a side note, a comparable study of the corrosive influence of denial on local, state, and federal authorities and how to overcome it would be a welcome addition to Mr. Tedlow's worthy contribution to this subject.
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11 of 15 people found the following review helpful:
5.0 out of 5 stars
The "unconscious calculus" of "protective stupidity", March 4, 2010
This review is from: Denial: Why Business Leaders Fail to Look Facts in the Face---and What to Do About It (Hardcover)
By now, Richard Tedlow has gained and fully deserves his reputation for writing books and articles that are of the very highest quality. In Giants of Enterprise, he examines the lives and careers of seven entrepreneurial CEOs: U.S. Steel's Andrew Carnegie, Kodak's George Eastman, Ford Motor Company's Henry Ford, IBM's Thomas Watson Sr., Revlon's Charles Revson, Intel's Robert Noyce, and Walmart's Sam Walton. Then he wrote The Watson Dynasty in which he explains the causes and effects of what he characterizes as "the fiery reign and troubled legacy of IBM's founding father and son." More recently, he wrote Andy Grove: The Life and Times of an American. In my opinion, it one of the two most important business biographies published in recent years, with the other being T.J. Stiles's The First Tycoon: The Epic Life of Cornelius Vanderbilt.
Denial is his latest book and, in my opinion, his most important and most valuable...thus far. As he explains in the Introduction, "Denial is the unconscious calculus that if an unpleasant reality were true, it would be too terrible, so therefore it cannot be true. It is what Sigmund Freud described as a combination of `knowing with not knowing.' It is, in George Orwell's blunt formulation, `protective stupidity.'" Tedlow acknowledges that there are several short-term benefits of denial (e.g. it is soothing, convenient, allows us to live in a world we have created and thus control..."while it lasts") and that is why it is so seductive. "Denial sometimes actually works," as with entrepreneurs who refuse to be discouraged despite the fact that the overwhelming majority of new businesses fail. Also, "the inevitability of catastrophe does not mean that we personally will suffer the consequences." In most circumstances, denial does work in the short-term.
What we have in this extraordinarily informative as well as eloquent book is a comprehensive explanation of what the subtitle correctly indicates: "why business leaders fail to look facts in the face - and what to do about it." Tedlow carefully organizes his material within two Parts. In the first, he examines those who "got it wrong" (i.e. refused to face realities). They include Henry Ford and his denial of what consumers wanted, five major tire manufacturers (i.e. Goodyear, Firestone, Uniroyal, BFGoodrich, and GenCorp) who denied the significance of the "radial revolution" initiated in Europe, and A&P's denial of emerging demographics and consumer preferences. In Part II, Tedlow shifts his attention to several examples of those business leaders who "got it right" at DuPont, Intel, and Johnson & Johnson.
Here are a few brief excerpts from Part I:
Whereas Alfred P. Sloan at General Motors realized that the desires and expectations of consumers were changing in the 1920s and they wanted more and better choices, Henry Ford observed that "any customer can have a car painted any color that he wants as long as its black...He needed people to buy black cars because the only finish available was a black enamel that could be quickly baked on."
In the 1970s and 1980s, the five major tire manufacturers' denial of a new technology "took place in two distinct phases. At first, they refused to believe that radial tires would succeed in the American market the way they had in Europe. Second, after it became clear that radials would indeed make it in America, the tire manufacturers denied that their world would change forever. Denial, however, does nit change reality. It simply makes reality tougher to deal with."
"What the A&P executives denied is that there are, in Disraeli's famous phrase, 'lies, damn lies, and statistics.' A&P executives celebrated the statistics they liked. They ignored the statistics they did not like...Sales were growing, but at less than half the industry average. . But the lion's share of the increases were taking place by opening new stores...What was denied in this instance is that a policy that had worked well in one context [i.e. signing only short-term leases for inner-city locations] might not work well in another [i.e. suburban markets with rapidly increasing populations where developers required long-term leases]." A&P's "slow collapse" at a "grinding steady pace" was the inevitable result of "relentless denial."
In Part II, Tedlow shifts his attention to business leaders who "got it right." For example, those at DuPont who recognized that the company "had suddenly and unexpectedly become far more difficult to manage." They completed an immensely difficult process of restructuring the entire company but only when it was "on the brink of disaster, in the midst of a crisis produced by one of the worst years in its history." Only then "was it able to reconcile itself to the fact that yesterday's structure was acting as a barrier against rather than an avenue toward tomorrow's strategy." And Tedlow then makes an especially key point: "Most remarkable is the absence of denial, the omnipresence of an engineering quest for facts, and the willingness to look those facts in the face even when they weren't pleasant." He then examines leaders at Intel (i.e. Gordon Moore and Andrew Grove) and Johnson & Johnson (especially James Burke) who also refused to "push aside hard truths in favor of more palatable or convenient" options and made decisions that required courage as well as candor.
Tedlow devotes the final chapter to providing what he characterizes as a "new point of view," one that is guided and informed by eight "lessons" to be learned, from those business leaders who, in ways and to an extent best revealed in context, overcame the "unconscious calculus" of "protective stupidity." Throughout his lively narrative, Tedlow's focus is on helping his reader understand to (a) what denial is, (b) why it is so "seductive," and (c) how to resist its appeal. The eight lessons discussed in the final chapter help to achieve that worthy objective and should be reviewed from time to time. Why? Because denial is not an all-or-nothing proposition. "It is a continuum. Individuals and organizations have the power to determine where on that continuum they fall...human brings and companies are capable of positioning themselves further toward the `facing facts' end of the spectrum than the `denial' end." Resisting denial requires a continuous "battle" that must be fought every day on many fronts.
Thanks to Richard Tedlow, those who read this book will be well-armed.
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