In 1982, Jay Doblin and Larry Keeley walked into a meeting with the top executives at Xerox, including newly-appointed CEO David Kearns and co-founder C. Peter McColough. These were serious guys who were pioneering incredible advances in physics, optics and engineering. Xerox was the undisputed king of copiers. Yet Jay had sacrilege in his hands: the Canon PC10.
Xerox’s leaders were distinctly unimpressed at this chugging machine, which laboriously churned out a series of fairly poor quality copies right there in the boardroom. As Larry tells the story today, their scowls said it all: “We are busy people. Why are you showing us such an inferior product?”
They were right, the copier was inferior – and yet, as we know from disruptive innovation theory, the Canon design heralded the end of Xerox’s dominance in this market and introduced a self-service revolution.
Without realizing it, Xerox’s leaders demonstrated the threat posed by orthodoxies – tightly-held beliefs that guide a company’s decisions. Xerox believed that copiers would always break down at some point, so the key to success was to build the world’s best copier repair force, along with ever more high-tech products. Commitment to this system was woven into Xerox’s culture, and a matter of pride for the firm’s leadership. Canon, in contrast, knew that it couldn’t compete on these terms, so it flipped the orthodoxy to imagine and develop a totally different kind of service. In so doing, it left Xerox reeling.
Why Orthodoxies Matter
Orthodoxies are present within every organization. They range from seemingly-innocuous biases or conventions to, at their most extreme, something that approaches religious-like devotion to a specific set of ideals. Oftentimes they are easy to see, but more often they are not explicitly recognized. Unstated assumptions that go unquestioned, they are the ‘entrenched wisdom’ that employees don’t even think to challenge – leading to blind spots that prove to be the insidious, seductive handmaidens of stasis and resistance to change. The end result: people fall into autopilot mode and fail to imagine better ways to tackle challenges and everyday activities.
To be clear, orthodoxies are not all bad. In fact, it’s a mistake to assign any kind of judgment to them, because they are neither good nor bad; they just are—but it is critical to be conscious of them. As the late CK Prahalad and Gary Hamel wrote in Competing for the Future, “All of us are prisoners, to one degree or another, of our experience.”
The roots of an organization’s orthodoxies can be found in the ‘sensible practices’ through which the company first found its feet and place in the world. But if executives are not hypervigilant, these careful systems can calcify as the industry evolves, providing a reassuring but false sense of security, even as the sands of disruption shift beneath the organization. It’s only a matter of time before a competitor spots and exploits an opportunity.
Where to Find Orthodoxies
Looking for orthodoxies needs to be a conscious process throughout the organization. Admitting your organization is rife with them is a good first step toward dealing with them, even while some orthodoxies, particularly those related to security or legal issues, may never – for good reason – be overturned. But, as economist Daniel Kahneman wrote in the June 2011 edition of Harvard Business Review, “Knowing you have biases is not enough to help you overcome them.” All orthodoxies need to be subject to regular scrutiny, and leadership needs to ensure that nothing becomes too sacred to be rethought.
It is useful to think about orthodoxies in two distinct categories: internal and external.
Internal Orthodoxies. These are often embedded in a company’s culture, so finding them is a major leadership challenge. This means that leaders have to be ready to openly question beliefs and practices that at one point may have defined a company’s success. Gauging when an orthodoxy has morphed from being helpful, inspirational and useful – and instead become an obstruction – is enormously challenging. Being conscious of internal practices and how the rest of a team approaches its work will help.
A good example of internal orthodoxies in action comes from Detroit. American car companies are known for their fierce internal cultures, which proved to be more of a millstone than a boon as the 21st century rolled around. In 2006, Alan Mulally left Boeing – his corporate home of 37 years – to join the Ford Motor Company as president and CEO. The company was in crisis, hammered by multiple forces, including the deeply- ingrained manufacturing processes and systems on which the firm was run, with tightly- controlled fiefdoms run by executives accustomed to running their own shows. Within three months of his arrival, Mulally hosted the year’s earnings call, announcing that the company had lost $17 billion. As Mulally explained in a later BBC interview, “You can run out of money really fast when you lose $17 billion a year.”