Failing To Get Outside The Box

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There's something refreshing about a speaker who calls his own advice "not particularly useful," acknowledging that even though he knows everyone in the room agrees with what he has to say, not a single one of them is likely to put it into practice.

Perhaps that's how Costas Markides was able to breathe new life into the dead-horse-beating clich? of "Think Outside The Box."

"Think outside the box. We all agree we need to do this, right? But is it useful advice," asked Markides, a London Business School professor and author of "All The Right Moves." "Of course not. We can't question what we cannot see. We cannot 'think outside the box' if we are not even aware that we are in the box. Before we question our assumptions, we must find out what these assumptions are."

Using a variety of puzzles that can only be solved by "outside-the-box" solutions, Markides offered some practical ways to figure out just what the box is, first.

"You have to question everything, and you have to allow the people in your organization to question things, too," he suggested. The place to start? "Question your current way of doing business. These are the who-what-how questions? Who are my customers? What do I offer them? How do I deliver it?

"If I asked all of you who your customers are, you would say 'our members,' and I would tell you, that's debatable," Markides suggested. He later elaborated on this point for The Credit Union Journal, adding, "This is about getting them to question things that we take for granted. It's not about thinking better, it's about thinking differently. If we segment our customers to discover that different kinds of members need different kinds of products and services now go to the next step: if these products and services are good for these members, why may they not be good for other members, or beyond that, why may they not be good for others outside of your membership?"

"You know that 20% of your customers give you 80% of your profits, but do you know who those 20% are," he continued. "Don't take your existing customers for granted. Continuously re-segment the customer base to discover 'new' and unexploited customer segments."

The next step is to question how the business is currently organized. For as much as Americans believe in capitalism and denounce communism, Markides said, it's amazing how many businesses are organized under the communistic model.

"Capitalism won the Cold War. Let's look at why," he observed. "Under capitalism allocation of resources is decentralized. It allows for lots of experimentation, even though only one in a hundred succeed. It allows for inefficiencies. It uses multiple and different sources of financing, and it provides the ability to challenge authority."

Yet most businesses more closely resemble communism: centralized allocation of resources, low tolerance for inefficiencies and experimentation, and, as Markides put it, "when was the last time you threw tomatoes at your CEO?"

The third step is to question the way the credit union develops strategies. "I know that credit unions are democratic organizations, but are you really?" he asked. "Ideas come from anybody, anytime, anywhere, but more often than not our strategy is formulated by our top managers in a retreat away from the office in less than two days."

This is closely related to Markides' fourth message: question your current organizational environment. He referred to a psychological experiment in which five monkeys were put in a cage. There was a banana hanging from the top of the cage, and a set of stairs leading to the banana. Every time the monkeys tried to get the banana, they were sprayed with cold water. Eventually, they stopped trying to get the banana. Then, one by one, a monkey was removed from the cage and replaced with a new monkey. The new monkey would see the banana and go for it. The other monkeys would drag it away and beat it up for fear that they would be sprayed with cold water.

But strangely enough, even after all five of the original monkeys had been replaced by new monkeys, the new monkeys had learned that if they tried to get the banana, they would be beaten, so even without having ever being sprayed the cold water, they learned not to go after the banana-but they never learned why.

"Do we see this happen at work? Of course we do. That's what happens when something's been done a certain way 'forever' and then when a new person comes in asks why it's not done another way, we immediately tell them 'It's company policy,'" Markides offered. "Allow your people to question things. Let them evolve from monkeys to humans."

It was Markides' final point that struck the same chord of honesty as his declaration that "thinking outside the box" is not particularly useful advice. "Even though I know that you accept all my previous messages, you are still not going to [implement them]," he said. "I know you believe what I've told you, but you're still not going to do it. That's called the Knowing-Doing Gap. You know what you should do, but you don't do it.

"Successful organizations always talk about changing, but they never do it until a crisis hits them," Markides advised. "Don't wait for the crisis to hit you."

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