Abstraction

Interesting article in Scientific American about a study that shows the brain is hardwired such that people fit into two behavioral categories. (More likely a continuum, but for purposes of illustration I’ll keep it straightforward).

In one category, people are predisposed to alter their behavior based on new information. In the other category, people are less responsive to new information, and tend to maintain the same behavior. Although the context of the study was political (this isn’t a political blog), I think that the study is equally interesting from a business perspective as well. A quote:

Amodio says that the anterior cingulate cortex (ACC), a forebrain region, “serves almost as a barometer for this degree of conflict.”"People who have more sensitive activity in that area,” he notes, “are more responsive to these cues that say they need to adapt their behavior,” reacting more quickly and accurately to the unexpected stimulus. On average, people who described themselves as politically liberal had about 2.5 times the activity in their ACCs and were more sensitive to the “No-Go cue” than their conservative friends.

“They are more sensitive to the need for change and more sensitive to the need to change their behavior,” Amodio says about the politically left-leaning subjects.

At an overall statistical level, I suspect that having a disposition one way or the other is not a good predictor of business success. All other things being equal, two entrepreneurs of opposite dispositions have an equal chance to succeed at the beginning of a new venture. Where it does matter is how a person copes with the unique challenges the new business will face.

For example, a person that tends to maintain the same behavior despite conflicting information may have the tenacity and drive to stick with a business plan no matter what until it succeeds. She will have the steadfastness necessary to keep the business moving forward even when everyone is a naysayer. In some business contexts, this is exactly the right person needed at the helm; the business would fail if the leader was endlessly second guessing and altering course.

On the other hand, a business plan into which people have poured blood, sweat, and tears, may be fatally flawed. In this case, the leader must be flexible enough to honestly appraise new information that conflicts with the existing business plan, and alter the course of the business based on this new information. Here, the leader that stubbornly maintained the status quo would fail.

How do you know which leader is right for which challenge? You don’t, except in retrospect. As Nassim Taleb points out, most of what happens in life is random; all you can do is put in your best effort. A person plays much less a role in their own success (or failure) than they give themselves credit for.