T H E FO G OF F E E DB AC K
GHJUHH³WKHLU HQYLURQPHQWV DUH FKDQJLQJ 6HFRQG WKH\·UH XQVXUH KRZ DQG LI FKDQJLQJ HQYLURQPHQWV ZLOO DIIHFW WKHLU ÀUPV )LQDOO\ WKH\ ÀQG LW GLIÀFXOW WR GHWHUPLQH ZKHWKHU FKDQJHV WR WKH ÀUP·V VWUDWHJLHV DFWLYLWLHV RU SURGXFWV DUH HYHQ QHFHVVDU\ These gray areas have the potential to spell disaster, he says, ZKHQ ÀUPV LJQRUH RU SOD\ GRZQ SRWHQWLDOO\ critical situations. “Often, when managers GRQ·W JHW FOHDU VLJQDOV WKH\ W\SLFDOO\ ORRN at the most favorable signals out there and begin to interpret data through a lens of success.” Joseph calls this positive spin attempt “ambiguity reduction.” He notes that it can prevent managers from recognizing deeper LVVXHV ZLWKLQ D ÀUP DQG OHDG WR IXUWKHU trouble.
S T U C K I N T H E PA S T
In addition, ambiguity may amplify perceived differences RI RSLQLRQ ZLWKLQ WKH ÀUP KH VD\V ´9DULDWLRQV LQ SHUFHSWLRQV may fuel debate concerning the best course of action, which slows decision-making and allocation of resources. With Blackberry, the ambiguity FUHDWHG D GLYLVLYH HQYLURQPHQW ZLWKLQ WKH ÀUP and caused delays in efforts to launch new products.”
“Often, when managers don’t get clear signals, they typically look at the most favorable signals out there and begin to interpret data through a lens of success.”
“In ambiguous situations, managers are more likely to rely on existing beliefs about the environment, instead of updating what they know,” Joseph says. “Their understanding of their environment based on feedback is unlikely to change since they lack an understanding of what the indicators are telling them. For example, the post-iPhone period was an era of strategic ambiguity for [Blackberry developer] RIM. In response, %ODFNEHUU\ IRFXVHG RQ ZKDW LW NQHZ EHVW HIÀFLHQW VHFXUH ORZ power devices and enterprise customers. Yet the market was being driven by consumers and software applications. Battery OLIH DQG VHFXULW\ GLGQ·W PDWWHU DV PXFK DQG %ODFNEHUU\ VXIIHUHG the consequences of their inaction.”
12 | THE PAUL MERAGE SCHOOL OF BUSINESS
OPPOSING CAMPS
UNREALISTIC I N T E R P R E TAT I O N S
Joseph observes that many managers engage in self-enhancing behavior and interpret ambiguous feedback in a favorable light to avoid the perception of failure. “Managers may also view performance problems as temporary, since at least some dimension of performance could be interpreted as positive,” he VD\V ´7KH\·UH OHVV OLNHO\ WR WDNH QRWLFH RI WKH QHHG IRU FKDQJHV or they believe that change is unnecessary.” :KLOH -RVHSK·V VWXG\ GRHVQ·W RIIHU TXLFN FXUHV IRU WKHVH maladaptive situations, he recently outlined three general ways ÀUPV FDQ SURWHFW WKHPVHOYHV IURP WKH SRWHQWLDO SUREOHPV WKDW can occur in the face of ambiguous feedback. Here are his suggestions:
