… how to detect it and how to avoid it
As much as we admire those who inspire us with a gripping idea of tomorrow – the people we like to refer to as “visionaries” – we dismiss and condemn those whose vision turns out to have been an illusion. We claim that we knew all along that their perspective was mistaken. But with the benefit of hindsight, anyone can identify tunnel vision. The important question is, how could we have detected it before it happened?
The stories of Elon Musk, Jeff Bezos, Jack Welch and – let’s not forget – Steve Jobs: they all make our mouths water. Unconventional ideas, great foresight, captivating visions and (mostly) huge successes. Or take the story of Alan Mulally, the former CEO of Ford Motor Company, who miraculously saved the company from the brink of bankruptcy. In 2012, Mulally told Forbes: “What I have learned is the power of a compelling vision.” And this wasn’t book knowledge; Mulally’s forward-oriented leadership style steered Ford back onto the path of success.
Wouldn’t we love to hear similar stories of a bellwether that revolutionized the energy market? Or a corporate hero who ushered in the new age of banking? Or… but hold on – we did. Remember when energy giant Enron was on its way to transform the energy market with its gripping vision? It was voted America’s most innovative company seven years in a row – right before its collapse in 2001. Or remember Fred Goodwin, CEO of Royal Bank of Scotland and still called Sir Fred Goodwin at the time in 2007, pursuing the seemingly rock-solid vision of a consolidated European banking sector by arranging a consortium of three banks to acquire ABN AMRO Bank of the Netherlands and become the first pan-European large-size player? But instead, he left the company in ruins and poised for government intervention 12 months later.
Apparently not all is rosy on the vision front.
Thousands of people lost their jobs, pensions and savings as a result of the abovementioned reckless and disastrous visions. Does this mean vision is mostly a matter of luck? Or is there something more meaningful and systematic to be discovered about the chances of success or failure of a grand vision? When is a vision so powerful that it induces positive, desirable change, and when is a vision so powerful that it puts those involved out of touch with reality?
Three Clear Warning Signs
Absolute truths are hard to find in the field of strategy and leadership; there is no algorithm for distinguishing good from bad visions. There are, however, three clear warning signs that indicate a vision – your vision, perhaps – might be putting you at severe risk of tunnel vision.
First of all, there is the phenomenon of misaligned incentives. The power of financial incentives should not be underestimated. The lure of a substantial bonus can cause otherwise sensible and balanced people to adjust their perspective accordingly. As the demise of Volkswagen unfolds, its reputation plummeting and fraud allegations about their diesel engines raining down on them, we will soon enough find out there was a financial relationship between their actions and their fraud. Undoubtedly, the lower “official” emission rates correlate to sales, which in turn correlate to personal bonuses for hitting sales and growth targets. Is this to say that evil people are running Volkswagen? Not at all. This is not about bad people; this is about people. The human mind has ways to blinker itself from what’s true and right in the face of strong financial incentives. Take a company like Kodak, which did not transition into the digital age in time. It’s not as though digital cameras happened unexpectedly overnight. In fact, Kodak was very much aware of their disruptive potential. Margins on film rolls were 60 percent, though, whereas margins on digital cameras were 15 percent. Acknowledging and adjusting to a new reality can be strongly discouraged within a corporate setting when incentives are purely attached to reporting strong quarterly results, and no compensation is made for pursuing longer-term objectives.
A second warning sign is the occurrence of groupthink, a term coined by Irving Janis in 1952. The desire for harmony in a group may lead to symptoms such as self-censorship, an illusion of invulnerability and direct pressure to conform. Groups have the tendency to develop a strong positive bias toward information that suits their seemingly unanimous opinion. This is not a bad thing in and of itself, as a high level of alignment and agreement can benefit a group in executing its plans. The problem with groupthink is that a vision may need adjustment when conditions change – as they invariably do when the future unfolds and the group’s worldview is put to the test. In such a situation, groupthink prevents a group of people from re-evaluating their options; instead, they doggedly carry on, even when their course of action is clearly no longer the best one.
Lastly, the presence of a narcissistic leader can be a sign of tunnel vision. Narcissistic leaders mesmerize their followers with their magnetic personalities. They unite, inspire and motivate, confidently radiating the idea that the future is safe in their hands. Effectively, they spare their followers the work of having to think for themselves. As pointed out by psychotherapist and leadership consultant Michael Maccoby in his classic HBR article Narcissistic Leaders, such leaders are not necessarily bad news; in fact, they can be very productive. With their larger-than-life leadership personas, they have the ability to challenge the status quo and bring about drastic and sometimes much-needed change. But – as Maccoby also points out – their successes feed their sense of grandiosity, which could eventually become their Achilles’ heel.
How can these three warning signs help us assess a vision? Well, when an organization adopts a radical, big-bet strategy, assigns the status of “truth” to assumptions, leaves no room for reconsideration or for contemplating timely exit strategies, is headed by a self-absorbed leader surrounded by people who no longer dare to challenge him and uses strong financial incentives to motivate its people to follow the same vision… you can probably fill in the blanks.
These are conditions that Enron and RBS shared and that set them apart from Ford. Mulally triumphed because his vision was externally oriented and serious about challenging assumptions. The reinvention of Ford was overseen by a leader who couldn’t be further from a narcissist; instead, Mulally was driven by a strong personal desire to serve and be of service to others. He embraced and encouraged the art of looking ahead, getting senior leaders at Ford to see and explore what was happening in the outside world – with the end goal of rescuing the company rather than achieving significant personal gain.
The next time you’re in doubt about a vision, check for these three warning signs. Although the factors of misaligned incentives, groupthink and a narcissistic leader do not guarantee the presence of tunnel vision, they should certainly set off alarm bells when evaluating a seemingly compelling vision.
Rob-Jan de Jong 
