I stumble across a book ‘Loonshots’ written by ,Safi Bahcall. In his wonderful book “Loonshots”, he describes the various levels of improvement, leading up to a systems mindset (to be precise Page 142 ).
The weakest teams don’t analyze failures at all. They just keep going. That’s zero strategy .
Example A :– Teams with an outcome mindset, level 1, analyze why a project or strategy failed . The storyline was too predictable . The product did not stand out enough from competitors ’ products . The drug candidate’s data package was too weak . Those teams commit to working harder on storyline or unique product features or a better data package in the future .
Example B :– Teams with a system mindset , level 2 , probe the decision making process behind a failure. How did we arrive at that decision ? Should a different mix of people be involved , or involved in a different way ? Should we change how we analyze opportunities before making similar decisions in the future ? How do the incentives we have in place affect our decision making ? Should those be changed ?
System mindset means carefully examining the quality of decisions , not just the quality of outcomes .
A failed outcome , for example , does not necessarily mean the decision or decision process behind it was bad . There are good decisions with bad outcomes . Those are intelligent risks , well taken , that didn’t play out .
Evaluating decisions and outcomes separately is equally important in the opposite case. More often bad decisions may occasionally result in good outcomes . Just to quote a few running examples :- (1) You may have a flawed strategy , but your opponent made an unforced error , so you won anyway . (2) You kicked the ball weakly toward the goalkeeper , but he slipped on some mud , and you scored .
Failing to analyze wins can reinforce a bad process or strategy .
You may not be lucky next time. Which is why probing wins is critically important compared to probing losses . You don’t want to be the person who makes a poor investment , gets lucky because of a bubble and concludes himself an investment genius , subsequently bets his fortune , and then loses it all next time around .
In decision making you need to be clear and have to develop a system mindset.