Eyes Wide Open: How to Make Smart Decisions in a Confusing World. Noreena Hertz

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СКАЧАТЬ to actively look for data that will contradict or refute it. He believes he must challenge his staff to consider how they could be wrong, and then assess how this might impact on their decision-making.39

      Who, at work or at home, can serve as Challenger in Chief for you?

      Detach from the Past – Lessons from Hollywood and Helsinki

      As well as challenging what it is we see before us right now, we also need to consider how the past might be affecting our present-day choices.

      For although our past experiences, good or bad, provide us with split-second cues which can often be very useful – I don’t put my hand on the gas hob if it’s switched on, because I know, having burnt my finger in the past, that it would be the wrong decision – experience, as we will see, can be a double-edged sword.

      Richard Zanuck was one of the most successful film producers of recent times. His hits included such classics and box-office juggernauts as Jaws, Cocoon, Driving Miss Daisy and, more recently, Tim Burton’s Alice in Wonderland, which grossed more than $1 billion.40 Hollywood royalty who spoke at his funeral and memorial services included Clint Eastwood and Steven Spielberg, who called him a ‘cornerstone of the film industry’.41

      But when I had lunch with Dick Zanuck at his usual table at George in Mayfair’s Mount Street, just days before he died in July 2012, we discussed one of the rare moments when his decision-making had gone very wrong.

      In 1965 a movie produced by Zanuck broke all box-office records. A musical about an errant trainee nun in the Austrian Alps, starring Julie Andrews, The Sound of Music was a gargantuan commercial success, rescuing Twentieth Century-Fox from the $40 million wounds inflicted two years earlier by Richard Burton and Elizabeth Taylor’s Cleopatra. It remains, in inflation-adjusted dollars, the third-biggest-grossing film of all time.42

      Zanuck was thirty years old, and this was his first big hit. So what did he do next?

      Understandably, he tried to repeat what he’d just done.

      ‘I was convinced that the musical was back, and a lot of people, a lot of other studio heads, were convinced that this was the way to go,’ he told me. He commissioned three more musicals, all in a similar sugary vein.

      All three were box-office flops.43

      Doctor Dolittle, an adaptation of the children’s books by Hugh Lofting, contributed to Twentieth Century-Fox posting a staggering $37 million loss in 1967.44 The next, Star!, released in 1968, which starred Julie Andrews and had the same director, producer and choreographer as The Sound of Music, also bombed: box-office receipts in the US were just $4 million, and losses were pegged at $15 million.45 The third, Hello, Dolly!, released in 1969 and starring Barbra Streisand, did equally badly, losing $16 million, bringing to a close a disastrous few years for Twentieth Century-Fox, and leading to Zanuck unceremoniously losing his job as production chief.46

      It’s not that the past is never a good predictor of what lies ahead. There are of course many examples we could cite of times when looking backwards, consciously or not, has helped people reach the right decisions. The key, though, is not to be overly wedded to our past successes and failures, or our experience-based instincts, so that shifting tides or new information are ignored.

      Nor should we assume a linear trajectory – more so now than ever, as we attempt to navigate today’s uncertain and unpredictable digital world, in which things are changing with an ever greater rapidity.

      Dick Zanuck explained to me that his movie strategy immediately after The Sound of Music fell victim to a fast-changing world, and a shift in cultural mores. When The Sound of Music hit movie screens, the appeal of singing nuns and the lush Technicolor greenery of the Austrian hills made sense against the backdrop of the early 1960s. But by the time the back-to-back movie flops were released, things had moved on. The Vietnam War and the Civil Rights movement had politicised the American public, Martin Luther King had been assassinated, pop and rock music were dominant, and saccharine-sweet family productions had lost their appeal.47

      Success does not necessarily breed success. Just because we haven’t seen a snake today or yesterday, it doesn’t mean that we won’t see one tomorrow. And just because a certain set of ingredients once worked, it doesn’t mean they always will.

      This was a tough lesson learnt by Finnish communications giant Nokia in 2007. From the 1990s onwards, Nokia dominated the mobile-phone industry. At its peak the company had a market value of $303 billion, and by 2007 around four in ten handsets bought worldwide were manufactured by Nokia.48 But when Apple introduced its game-changing iPhone in 2007, Nokia was caught sleeping on the job. Hoping to keep its edge on the market, it had piled $40 billion into research, secretly developing an iPhone-style device – complete with a colour touchscreen, maps, online shopping, the lot – some seven years earlier. But the product never hit the shelves. In spite of all the research (which ended up generating about $6 billion-worth of patents), Nokia decided to stick with what it knew: good, solid, reliable mobile phones. As a former employee working in the development team at the time said of that decision, ‘Management did the usual. They killed it.’49 In fact, when the iPhone was introduced, Nokia engineers sneered at the Apple device’s inability to pass their ‘drop test’, where a phone is dropped onto concrete from a five-foot height.50

      They believed that the past could provide a reliable guide to the future, but as we now know, it didn’t. In the five years since the iPhone was introduced, Nokia has lost 90 per cent of its market value.51 Meanwhile, Apple has sold over a quarter of a billion iPhones.52 Indeed, in August 2012, at the same time as Nokia’s bonds were rated as worse than ‘junk’, Apple’s share price peaked at $664.74, making it the most valuable company in history, with the iPhone generating 55 per cent of that value.53

      What can we learn from these two stories to help us with decision-making? That there is no such thing as a trend? Clearly not that – just ask the erotic fiction writers now bringing home the bacon thanks to E.L. James. Or those who’ve made their millions off the back of the Twilight franchise.

      Never to make a musical? Not that either, although with a twinkle in his eye Dick Zanuck joked with me that that was the lesson he’d learnt.

      How about that failure is the death knell for future success? Not necessarily. Zanuck went on to make many more blockbusters and critically acclaimed movies. And there are a number of examples of entrepreneurs who’ve gone on to make fortunes after losing it all.54

      But what we can take away is this: do not get so attached to past successes or failures that they inhibit your ability to think cogently, and to assess the present challenges with an open and objective mind.

      Be acutely aware that the interplay СКАЧАТЬ