This week’s New Yorker contains one of the most insightful commentaries on Enron that I’ve seen: Malcolm Gladwell’s** “ Open Secrets: Enron, Intelligence, and the Perils of Too Much Information.” I’ve read a great deal about Enron over the years, and, along with colleague Sam Bodily, have written about it. After all that has been told, it is surprising to see something fresh on the topic.
Gladwell’s article is occasioned by the imprisonment last month of former Enron CEO, Jeffrey Skilling. The writer notes the stiff sentence (24 years) and then observes that the core evidence used to incriminate Skilling was in the public domain. Yet the central premise of the prosecution was that “we were not told enough.” Gladwell writes, “the prosecutor was wrong. Enron wasn’t really a puzzle. It was a mystery.”
The distinction between puzzles and mysteries was drawn by Gregory Treverton, a national security expert. A puzzle has a “simple, factual answer” and is solved by getting more information. The location of Osama bin Laden is a puzzle. Finding the answer requires increasing the collection of intelligence. A mystery is different—it may have many contingencies and is solved by more analysis rather than more fact-gathering. What will happen to Iraq in 2007 is a mystery. Solving puzzles depends on what we are told; solving mysteries depends on what we hear, on listening well.
Gladwell argues that the financial community needs to make a transition from fact-gathering to true analysis. This is not a new plea. In my book on merger failures I wrote about the disastrous combination of the New York Central and Pennsylvania railroads in 1968 (the merged firm went bankrupt in 1970). The classic lament then was that the analysts could tell you how many miles of track lie between New York and Chicago, but not whether the firm would survive. Too many business and financial analysts dwell on fact-gathering and fact-recitation.
The key to excellent analysis is an inquiring mind, which business schools have a role in preparing. Great business-school education should include these features:
* Repeated exercise in the solution of mysteries, as opposed to puzzles.
* Asking good questions as opposed simply to fetching answers.
* Synthesis of qualitative and quantitative information and of the perspectives of different disciplines.
* Mastery of tools and concepts, especially acknowledging their limitations.
* Questioning assumptions; thinking independently.
* Dealing with ambiguity and incomplete information.
* Probing the ethical values implicit in policies and decisions.
* Communicating well the insights derived from thoughtful analysis.
* Drawing actionable recommendations from analysis.
* Modeling a process of inquiry that includes group work, comparison of findings, debate, and mutual challenge in an environment of candor and respect.
All of these features drive growth in wisdom.
An educational experience along these lines is very different from the model of lectures-and-book learning that characterizes so much of management education. At Darden, our extensive use of case discussions, simulations, and team projects affords a stark alternative to the conventional approach and incorporates almost all of the features bulleted above. We are proud of our program, but we can be better.
Training people well to solve mysteries is fundamentally about engaging them well. I have chartered a team of faculty and professional staff to consider the ideal of high-engagement learning and to offer recommendations for Darden’s forward development. We need to consider aspects as wide-ranging as research, technology, curriculum, teaching materials, classroom pedagogy, and faculty development. The report of this team will engage the broader faculty of Darden in a conversation about steps from here.
Puzzles are important and need to be solved. But I would argue that the resolution of mysteries is a contribution of higher impact. Improving the way we address mysteries is both a challenge and an opportunity for business schools.
** Malcolm Gladwell is a Fellow of Darden’s Batten Institute.
Posted by Robert Bruner at 01/05/2007 11:10:22 AM