151 – Make your business a “Wise Enterprise” | Ft. Arash Arabi
Too many organizations are ruled by opinion-based decisions rather than evidenced-base. That simple insight is core to Arash Arabi’s leadership philosophy. The author of “The Wise Enterprise”, believes our current moment will be critical to the continued success or failure to organizations across around the globe. In this captivating conversation with host David Frizzell, Aravi adds some much needed clarity to what can sometimes be a nebulous concept: professional wisdom.
The word “wisdom” evokes proven effectiveness; actionable knowledge earned through triumph over time. Asked to pinpoint what wisdom in practice looks like in the workplace, Arabi illustrates his perspective through an anecdote. Like many of us, he spent years daydreaming about the prestige that publishing a book could offer, but it wasn’t until he considered the financial benefits that the idea truly took root. In the end, it was the insight of a friend who pointed out his work’s focus on emotional intelligence that delivered the spark.
Connotations and Denotations
The commonly positive associations engendered by the word “wise” give it tremendous communicative weight, but for Arabi it is important to understand what exactly wisdom is. Here, he defines the lines by placing wisdom a level above knowledge and understanding. While grasping a concept represents a significant cognitive achievement, wisdom occurs only when a familiarity with an idea can yield new insights and beneficial results. In practice, this means guiding both ourselves and others through gaps in our knowledge to great ideas.
“Game Theory” refers to any endeavour to understand how a rational actor in a specific scenario would respond under a specific set of circumstances. It aims to understand how and why people arrive at the conclusions they do, and predict with some certainty how they will react as a result. Within Arabi’s framework of professional wisdom, game theory is used by an organization to better understand its market, its customers, and the motivations of its team members. This type of systemic thinking is one of his “golden rules” from the book.
Talking About Practice
Game theory can be highly instructive for systemic thinkers, but as we all know, there is no substitute for experience. Arabi puts this idea in historical context with a look back at India during the recent British Colonial Era. The populous capital of Delhi was inundated with wild cobras, and the obvious solution seemed to be offering a reward for killing them. The program met with success at first, until subjects learned they could make more money by breeding cobras to kill. The English failed to consider all aspects of the issue they created.
The High Price of Short Sight
As the most successful organizational leaders know, systemic thinking has tangible value. Something as universal as increasing profits can be approached in a number of ways, but what many fail to take into account is that each has benefits and drawbacks. For example, lowering costs by cutting workers may immediately increase profits, but at the long term expenses of production, experience, and morale. The wrong decisions in this area can quickly and permanently cripple an organization for the sake or minimal short-term gains.
Honing Systemic Sight
Like any skill set useful in management and leadership, big-picture thinking is an ability that must be carefully nourished in order to grow. Arabi recommends those interested in building a more capable toolbox for systems constantly take in material from those who have mastered the art form. However, he closes the conversation with some practical advice as well. When attempting to solve a problem, it is important to ask ourselves questions such as “is this the root cause?” and “what specific outcome am I trying to achieve?” All told, considering an issue from the most angles requires us to take the widest view possible.