Don’t Let Distractions Kill You
Explaining Focus and Cognitive Dissonance
Some distractions in life and business are easy to find and get rid of, but the truly dangerous ones are those that once were important, those that used to serve us but no longer do — and exist in a blind spot of cognitive dissonance. Because of the way our brains are wired, we don’t like to be inconsistent in our decision-making and we will continue to reinforce past decisions we have made — because it’s painful for us to admit we were wrong, ever.
Why is it so easy for an outsider to quickly see the junk that clutters our businesses and our minds, that we seem to miss?
Marcus Lemonis understands the power of getting rid of (often low-margin) distractions and in “The Profit” TV show regularly puts it into practice. One episode:
the company was devoting the majority of its retail floor space (60%) to a wide assortment [of] key lime novelties from third parties, all of which had low margins in the 20 to 25% range. In contrast, the pies hovered around a 90% margin.
Marcus got rid of the retail items which generated (low margin) sales but created a cluttered feel to the store, and replaced it with a combination of open space and seating for customers to sit and enjoy the high-margin key lime pies. Ever wonder why management consultants and “fix my business” TV shows alike have a profitable existence? Because we fool ourselves to ignore the truth that stares us in the face every single day.
How can this be? Cognitive dissonance theory may have the answer, as laid out by Tavris and Aronson in their their excellent book “Mistakes Were Made But Not By Me: Why We Justify Foolish Beliefs, Bad Decisions, and Hurtful Acts” reviewed by Daniele Procida here:
It works like this: I do something that I should not have done, and this troubles me, because I’m not the kind of person who does that sort of thing. Redressing the mistake will be even more painful or difficult than not committing it in the first place would have been. So, to salve this nagging complaint of the soul, I declare to myself that the act was the right one all along, and I confirm this by reinforcing it at the earliest possible opportunity.
Put that on a loop, and it’s easy to see why change is hard when we are wired to keep reinforcing past behavior.
Examples are all over — does this sound familiar? I recently spoke with a small business where the small day to day team wants to give up its office space and become a virtual organization, but they are tethered to the space not because the employees want to work there, but because the owner (who seldom works from the office) is unwilling to let go of the subscale internet retail operation that barely makes any money and is wholly unrelated to their core business. Aside from the thousands of dollars a month in property costs and the individual costs borne by employees to commute, everyone in the space is distracted at having to deal with shipping junk they don’t make to people across the country. It’s hard to cost out the “distraction opportunity cost” of those peoples’ time, and so we may never know what they lose by not focusing.
While they may not be everyday Joes, Bill Gates and Warren Buffett certainly know what it is to focus, and we should too.
The distraction opportunity cost is hard to quantify, and especially difficult in business because often you’re pitting an incumbent of known size (e.g. $x million in revenue or profit) against an opportunity cost of unknown size and quality (e.g. having these people work on this nascent area instead). I experienced this in my own company when we made a difficult decision to shut down a profitable line of business, even after having several offers to buy it from us. It was generating a decent if declining level of profit, but it required most of the attention of three engineers and two businesspeople to maintain and we’d already put all our other resources into a different technology. We wanted the engineers to be able to work more on our core technology — and as a startup, I couldn’t really quantify precisely what having them focus on the new stuff would mean, while our management team could count the dollars coming in from the stuff they were working on today.
We received a multi-million dollar offer to sell the business without transferring any people, but having 2 of our engineers work for 3 months to help move the system to the buyer. After working with the prospective buyer for a month on the details, they came back and said they wanted 9 months of the two engineers’ time. After deliberating with all involved on our end, I pulled the plug on the deal and we walked away from the money. We then wound down that line of business and moved our engineers to work on the core stuff. It was a difficult decision to make and not one that everyone agreed with — but I knew that our small engineering team would suffer working on the old technology, bleeding in both time and morale, sinking more effort into an area everyone knew wasn’t really going anywhere and was just an ATM (of dwindling size) for the business.
So after this experience I often take a look at the patterns in my daily life and in business and ask myself if my starting assumptions are still valid, or whether I’m just avoiding making a needed change. Because this is the hardest bit: before you can Focus, often, you really first need to Choose.
