Popular vs. Profitable Thinking
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8 August 2013 - 23:46, by , in Strategic Planning, No comments

It’s popular to eat fat free foods. But when I thought to read the label on my Fat Free Fig Newtons, I was surprised to learn that saving 3 grams of fat costs me double the calories of the tastier, regular newtons.

“The problem with popular thinking is that it doesn’t require you to think at all.” (1) Popular thinking is easy. Profitable thinking may be somewhat harder but well worth the effort. Here are four examples:

Popular thinking: High gross margins result in bottom line profits.

Profitable thinking: Studies of organizations using Gross Margin Profiling find that low margins with low activity consumption result in sizable profit.

Popular thinking: You have to be a millionaire to be wealthy.Profitable thinking: “A person is wealthy when their monthly investment income equals or exceeds monthly expenses.” (2)

Popular thinking: High cholesterol is the best predictor of potential heart attacks.Profitable thinking: Half of all heart attacks occur in people with normal cholesterol levels. An inexpensive test for C-reactive protein (CRP) is a more reliable test for finding people at risk. (3)

Popular thinking: During a recession, take every customer sale you can get.Profitable thinking: A study of companies following the 1990-91 recession found, “In the downturn, winning companies walked away from bad business and losers did not.” (4)

Economist John Maynard Keynes asserts, “The difficulty lies not so much in developing new ideas as in escaping from the old ones.” Going against popular thinking can be difficult. But bucking a tradition may mean the difference between life or death for you or your organization.

Popular thinking often proves to be wrong and limiting. Questioning what’s popular isn’t necessarily hard once we create the discipline of doing it. John Maxwell, in Thinking for a Change, recommends five activities we can use to question popular thinking:

  • Think before you follow. 
People in some industries or professions follow decades-old practices without giving much thought. After my speech to the National Managed Health Care Congress, a person asked, “Each time I’ve recommend Activity Based Management to my hospital’s CFO, he’s replied, ‘ABM is just a fad’. Is that true?” I responded, “Collaborative thinking in an industry experiencing distress gives cause to circle the wagons. If your CFO will break loose from the industry wagon train, he’ll learn that ABM is a proven, principled best practice, not a short-lived fad.” It is profitable to occasionally stop and ask, “Do I really want to be like the person or organization I’m following?”
  • Appreciate thinking different from your own.
“As a leader, you might be surprised by the energy unleashed when you adopt the habit of readily asking, ‘What do you think?’” (5) According to consultant Betsy Raskin Gullickson, “One of our clients once praised the strategic thinking of a team member. We found this puzzling because we couldn’t find a single idea or piece of advice that person had delivered; she hadn’t done anything. But the client said, ‘She asks great questions; she gets me to think about things I hadn’t considered before.’” Don’t overlook the value of coaches or consultants who ask you thought-provoking questions or demonstrate new methods to accomplish your objectives.
  • Continually question your own thinking.
Andy Stanley says, “In an organization, we should remember that every tradition was originally a good idea – and perhaps even revolutionary. But every tradition may not be a good idea for the future.” What traditions have become obstacles in your life or organization? Maybe it’s your old P&L format that separates and measures cost by type and location instead of by value and process. New formats result in new ideas.NOTE: If you’d like to receive a free, side-by-side example of a traditional versus process-based P&L, send an e-mail toTomPryor@icms.net.
  • Try new things in new ways. 
When was the last time you did something for the first time? At age five, first time activities were a common occurrence. Fifty years later, doing new things in new ways is no less important. To spur new thinking and redirect my priorities, I will eliminate my office next week. My primary workspace will be at my customers, helping them improve their organizations. At other times, you’ll occasionally find me sharing with an ICMS staff member or sitting at a table with wireless laptop at Starbucks. The change may not be popular but I believe it’ll be much more profitable.
  • Get used to being uncomfortable.
“Our organizational world is no longer a pattern of jobs. In place of jobs, there are part-time and temporary work situations.” (5)According to William Bridges, author of Job Shift, jobs are disappearing but work is not. Software engineer Teresa Stowell says, “You won’t last at Microsoft if your job is just a job. People work anytime and all the time, with no one keeping track of their hours, but with everyone watching their output.” When projects end, Microsoft employees move on to a new one, taking with them the reputation they earned at the last project. Making a living in the 21st century will require much thought. Spend time thinking about your own activities, their value and their output.

Popular thinking limits potential. Prior to Roger Bannister, the running world believed that the human body simply wasn’t constructed to run the mile in less than four minutes. Bannister thought that the limit was a lie. With goal in mind, Bannister ran a 3:59.4 mile on May 6, 1954.

Today, there are sixty year olds bettering Olympic gold medal times set by twenty year old runners of years past. Popular opinion assumes faster times are because of better vitamins, training or nutrition. But that doesn’t really explain it, because the same improvement hasn’t happened with racehorses, despite controlled breeding and improved nutrition. It is profitable to recognize that human potential rests in the mind, not the body. “This is because humans are learning to expand their minds while the body merely follows.” (7)

Near the beginning of King Solomon’s reign, God approached with a proposal: Ask Me for anything you want. Popular thought would assume he would have asked for great riches. Instead, Solomon thought profitably and requested wisdom. What do you or your organization want today? Take time to think profitably.

(1) Thinking for a Change, John Maxwell, Warner Books, 2003
(2) Rich Dad, Poor Dad, Robert Kiyosaki, Warner Books, 2000
(3) “Heart Mender”, Alice Park, TIME, August 20, 2001
(4) What Did the Winners of the Last Recession Do Right?, Jane Linder & Brian McCarthy, Accenture Institute for Strategic Change, 2003
(5) “Beware the Man Who Knows”, Bob Gunn, STRATEGIC FINANCE Magazine, April 2003
(6) Jobshift: How to Prosper in a Workplace Without Jobs , William Bridges, Addison-Wesley Publishing, 1994
(7) 17 Lies That are Holding You Back & the Truth that will Set You Free, Steve Chandler, Renaissance, 2000

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