Business

Last updated: 31 march, 2011 - 16:28 GMT

Thinking about Thinking

About this programme by Peter Day

Every few years, I manage to slip a programme about Thinking into Global Business. I think it is an underrated activity. I think there's far too little thinking about thinking.

For the first programme about thinking, maybe 10 years ago, I went along to a very select range of apartments right in the centre of London, just off Piccadilly, called The Albany (or simply Albany to distinguish it from a public house).

It's been the home of distinguished men, originally bachelors, for the past 200 years.

I went there to meet the ingenious author Edward de Bono, inventor of "lateral thinking", in his elegant set of rooms.

Lateral thinking is a way of outwitting conventional thought processes by deliberating taking a not directly logical approach to problem solving. Conventional thinking is limited by logic and argument, he says.

So de Bono stirs things up by introducing entirely random words into problem solving, and finding relations between them and the matter in hand. There are many other almost mechanical techniques for priming the thinking mind.

Out of this enforced creativity may emerge ideas un-teathered by conventional thought processes. It is a striking idea. Creativity should not wait for an inspiration, he argues: it should be turned on, on demand.

This is enormously stimulating because it takes good ideas out of the hands and brains of a trained and chosen few and inserts it into the minds of everybody willing to participate.

Routine

He tries it on prisoners and dropout school children. Enabled by this almost mechanically thinking process, they realise they too can participate in the thoughtful society. Thinking, even induced lateral thinking, gives people the power to express themselves.

It is an enlivening thing. It was an elegant programme.

I've just had another seminar on thinking, this time with Roger Martin, Dean of the Rotman School of Management in Toronto, and Hilary Austen, a professor there. You can hear it in this week's Global Business.

For some years Roger Martin has been working to turn Rotman into a centre of what he calls Integrative Thinking. Confronted by so many business schools teaching routine approaches to routine problems, he says most decisions involve a choice between two alternatives.

What nonsense this procedure is. The real world is full of shaded choices, says Roger Martin. Business people need to embrace the chaos of the surrounding world, not try to stifle it with traditional rationalisations. They need to choose not between two opposing models, but to integrate the best features of both, to learn to cope with opposing ideas, and relish them.

(Some people have long argued that this is the mark of the intellectual, at which stage I get out of my depth.)

Dean Martin is also an enthusiast of Design Thinking, which we have made one or two previous programmes about.

That also respects and reflects the outside world by looking to design disciplines to invigorate an organisation, redesigning the whole business not just the products and services it makes and provides.

Hilary Austin also thinks that conventional thinking inhibits organisations from embracing change and managing themselves well.

Football

She teaches at Rotman and runs a California based consultancy called Artistry Unleashed. Her clients are businesses, not individuals seeking to unlock their inner creativity.

Artistry Unleashed is also the name of her new book. She also wants people to embrace and not be afraid of the messiness of the real world. She's an integrative thinker with a specifically artistic message. Learn form the way artists see and cope with the world.

On a different tack, Roger Martin has also been thinking about the Credit Crunch Bubble and the crash that followed it ... a recession many western countries still seem to be living through.

In a new book called Fixing the Game, he argues for the past 35 years, the purpose of the corporation has been distorted by an emphasis on financial returns for owners, shareholders and executives.

It's a distortion begotten (he says) by a hugely influential paper published in 1976 in the rather obscure Journal of Financial Economics by two American professors, Michael Jenson and William Meckling.

They called it the Theory of the Firm. They argued that shareholders would do best from the companies they owned if managers and executives were cut in on the ownership with shares and options.

This article was hugely influential in the business world. It changed corporate reward structures; it intruded into the real world of business performance the expectations market of the gambler.

It was as though the US National Football League allowed participant team players to bet on the outcome of the games they were taking part in. Of course the NFL does not allow this for obvious reasons.

Roger Martin argues that this gambler's perspective on financial performance in business is a main contributor to the bubble economy we now live in.

He thinks executive compensation should be restructured to focus on the real business, not the financial expectations marketplace. He thinks pension fund and hedge fund power should be reigned in, and the role of private companies in the economy should be enlarged.

And when you hear his ideas - and read the book - you realise why Roger Martin is so keen on thinking outside the box.

Previous updates - November

October

September

  • The media is going through a 'double-mangle' says Peter Day.

  • In San Diego, Peter Day investigates the company that produces WD40's secret formula.

  • Peter Day looks back on a year of the credit crunch with Simon Johnson, former chief economist for the IMF.

  • Peter Day finds out from the experts how to start a bank.

  • Peter Day looks at the great expectations in landlocked Bolivia and its part in the auto revolution.

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