Focus Your Company Goals by Zooming Out
March 11 2013 by Francesca Gino
Funded by Lee Byung-Chull in 1938, Samsung Group is one of South Korea’s largest and most successful family-run conglomerates, as well as one of the largest, multi-billion dollar corporations in the world. The company’s storied history does not always depict success. For instance, in 1992, Chairman Lee realized a long-cherished dream of his father by announcing the group’s entry into the car sector. In a public statement raising skepticism from Samsung managers, Korean government officials, and industry commentators, the chairman announced that Samsung Motors would be among the world’s 10 largest car manufacturers within the next two decades. Despite advice for alternative investments, the chairman did not change his plans: The company had succeeded in other industries, indicating –in his eyes– that Samsung should not be afraid of entering a new business. The company invested a lot of time, money and seasoned executives to achieve success in its new venture. Yet, Chairman Lee’s plan failed to materialize. Right from the start, Samsung Auto suffered operating losses and significant interest charges on its loans. Within the span of a few years, the company had to divest its car business for a fraction of its initial investment.
How did such a thoughtful and experienced chairman so grossly mispredict the ability of his company to succeed in a new industry? Chairman Lee focused too narrowly on Samsung’s past success in other contexts, and paid too little attention to the complexities of the new industry. Such narrow focus, as it turns out, is common among leaders and often sidetracks their decisions. In fact, a narrow focus of attention leads most of us to miss important information that could benefit our decisions and clarify our thinking.
Being able to focus, one may argue, seems to be a critical skill for CEOs and executives to possess. After all, their jobs require them to make decisions under tight deadlines, multi-task, and sort through the often-overwhelming information available to them. Simultaneously, in their position, they are often interrupted, making the ability to focus even more critical. And yet, if they focus too narrowly, their decisions can get sidetracked in three main ways. First, they may miss the bigger picture, ignoring information that would improve their decisions as they try to execute our plans. For instance, Chairman Lee disregarded the advice from other parties who were questioning his decision to enter into the car sector. Second, an overly narrow focus may lead most of us to overestimate the extent to which other people have access to our private information. When we are too focused on what we know, we forget that other people do not have the same information we have and will thus reach different conclusions. Finally, it may lead us to fail to realize that the constraints we are under may also influence the actions of other people we are interacting with.
The consequences of having an overly narrow focus are not only problematic but potentially very costly. How can we assure this concentration is not sidetracking our decisions? Simple: zoom out to get a sense of the bigger picture and the role other people play in it. Broadening our focus when considering information ensures we don’t miss important details. It involves taking a step back when making decisions and asking questions that reflect the bigger picture. Such questions might include: “Why did I choose the information that I did?” “What information am I missing?” “What was my initial plan?” and “Why did I embark on this course of action, and am I still on track?”
As a metaphor, consider Georges-Pierre Seurat’s paintings, such as “Sunday Afternoon on the Island of La Grande Jatte” or “The Circus.” Seurat uses pointillism, a painting technique where small dots of pure color are applied in patterns to form an image. Pointillism relies on the ability of the viewer’s eye and mind to blend the individual dots of color into a fuller range of tones. Thus, where the viewer stands affects the way he or she views the painting. When viewers stand too close to it, they cannot fully appreciate the artist’s work. They can probably admire the color and the precision of the small, distinct dots, but they do not necessarily know what they are looking at. But if they look at the painting from a distance, they can gain a better understanding and appreciation of the entire image, in addition to its details. In the same way, when we “stand too close” to a decision-making problem, we may miss the bigger picture and overlook how our own information and constraints influence others. Thus leading our ultimate goals astray.
Francesca Gino is an associate professor of Business Administration at Harvard Business School and the author of “Sidetracked: Why Our Decisions Get Derailed, and How We Can Stick to the Plan.”