Black Box Thinking: Why Some People Never Learn from Their Mistakes - But Some Do

by Matthew Syed

In his seminal book, Why Smart Executives Fail: And What You Can Learn from Their Mistakes, Sydney Finkelstein, a management professor at Dartmouth College, investigated major failures at more than fifty corporate institutions.11 He found that error-denial increases as you go up the pecking order. Ironically enough, the higher people are in the management hierarchy, the more they tend to supplement their perfectionism with blanket excuses, with CEOs usually being the worst of all. For example, in one organization we studied, the CEO spent the entire forty-five-minute interview explaining all the reasons why others were to blame for the calamity that hit his company. Regulators, customers, the government, and even other executives within the firm—all were responsible. No mention was made, however, of personal culpability. The reason should by now be obvious. It is those at the top of business who are responsible for strategy and therefore have the most to lose if things go wrong. They are far more likely to cling to the idea that the strategy is wise, even as it is falling apart, and to reframe any evidence that says otherwise. Blinded by dissonance, they are also the least likely to learn the lessons.