The Dangers of Hubris in the COVID-19 Crisis: Learning from History and Embracing Humility

The Dangers of Hubris in the COVID-19 Crisis: Learning from History and Embracing Humility

Introduction

Hubris has been a destructive force throughout history, and it seems to be rearing its ugly head again in the midst of the COVID-19 crisis. As we grapple with the ongoing pandemic, it is crucial to recognize the role hubris plays in decision-making and its potential impact on our lives and organizations. In this blog post, we will explore the concept of hubris, how it affects our response to COVID-19, and how we can learn from it to avoid making similar mistakes in our personal and professional lives.

What is Hubris?

Hubris is defined as excessive pride or arrogance that results from an inflated sense of self-worth or importance. It often leads to overconfidence, which can have disastrous consequences. Historically, hubris has been a driving force behind many conflicts, including World War II. In the context of the COVID-19 pandemic, hubris is manifesting itself in the denial of scientific evidence and expertise, as well as a disregard for the advice of public health officials.

COVID-19 and the Resurgence of Hubris

As COVID-19 cases continue to rise, the role of hubris in our response to the pandemic becomes increasingly evident. Some elected officials and members of the public are choosing to ignore the advice of public health experts and scientists, instead relying on their own beliefs and opinions. This is a dangerous approach, as it can lead to decisions that are not based on the most accurate and up-to-date information.

The problem with this mindset is that opinions are not facts. While everyone is entitled to their opinion, opinions are personal expressions of feelings or thoughts that may not be grounded in data or evidence. Conversely, facts are statements that can be proven true or false based on supporting data or evidence. By ignoring scientific evidence and expert advice, we are putting ourselves at greater risk and prolonging the devastating impact of the pandemic.

The Human and Economic Costs of Hubris

The denial of scientific evidence and expertise in the face of COVID-19 has had severe consequences regarding human lives and economic costs. As of now, over 130,000 people have died in the U.S. due to COVID-19, and this number continues to rise. In addition to the immediate loss of life, long-term health consequences exist for those who survive the virus. Research shows that survivors may experience strokes, blood clotting, heart, lung, and neurological damage. Furthermore, studies on SARS, a COVID precursor, indicate that psychiatric morbidities and chronic fatigue may persist for years after recovery.

These long-term health consequences will also have a lasting economic impact. As survivors struggle with increased health issues, the economic effects of COVID-19 will continue well beyond the development of a vaccine or the achievement of herd immunity. The cost of hubris in this context is immense, with severe repercussions for both human lives and the economy.

Learning from the COVID-19 Crisis: Avoiding Hubris in Our Own Lives

As we navigate the ongoing COVID-19 crisis, it is essential to recognize the dangers of hubris and take steps to avoid it in our personal and professional lives. Here are some suggestions for combating hubris:

  1. Be open to new information and be willing to change your mind.
    When presented with new data or evidence, be open to reevaluating your beliefs and opinions. This flexibility will allow you to make more informed decisions.
  2. Recognize the limits of your own knowledge and expertise.
    No one is an expert in everything, so it is crucial to acknowledge when you are out of your depth and seek advice from those with relevant expertise.
  3. Emphasize facts over opinions.
    When making decisions, prioritize factual information and evidence over personal feelings or beliefs. This will help ensure that your choices are grounded in reality and have a solid foundation.
  4. Foster a culture of humility and learning.
    In your personal and professional life, create an environment where people feel comfortable admitting and learning from their mistakes. This can help prevent the development of hubris and encourage continuous growth and improvement.
  5. Encourage open dialogue and collaboration.
    Promote open communication and collaboration among team members, colleagues, and friends. This can help ensure that a variety of perspectives and expertise are considered, ultimately leading to better decision-making.
  6. Be aware of confirmation bias.
    We all have a tendency to seek out information that confirms our existing beliefs while disregarding evidence that contradicts them. Be conscious of this tendency and actively work to challenge your own biases.
  7. Practice empathy and compassion.
    Take the time to put yourself in others’ shoes and consider their perspectives and feelings. This can help to counteract the arrogance and self-centeredness that often accompany hubris.
  8. Reflect on past experiences and learn from them.
    Regularly review your past decisions and actions, identifying instances where hubris may have played a role. Use these experiences as learning opportunities to prevent similar mistakes in the future.

Conclusion

The resurgence of hubris during the COVID-19 crisis serves as a stark reminder of the dangers of arrogance and overconfidence. By recognizing the role of hubris in our decision-making processes and taking steps to avoid it, we can minimize its destructive consequences on our lives and organizations. As we continue to navigate the pandemic, let us use this opportunity to learn from our mistakes and strive for humility, open-mindedness, and fact-based decision-making.

 

Copyright (c) 2020, Marc A. Borrelli

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Ideation! Harder Than It Sounds

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We All Need Clarity

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Is Your Company Scalable?

Is Your Company Scalable?

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Are you ready for the Talent Crunch?

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Now is the Time to Take Action

Now is the Time to Take Action

There is an old Chinese proverb that says, “The best time to plant a tree was 20 years ago. The second best time is now.”

As we face uncertainty due to COVID, business leaders need not wait for “normal” to return, they need to take action now. “Normal” is not returning! Remember this is not an economic crisis as much as a public health crisis. Until we fix the latter, the former cannot recover. Given our failure at dealing with the latter, I think that we are going to be living in this uncertain state for the next 12 to 18 months. Thus by the time we emerge, behaviors adopted during this time will have become the norm.

While many companies have received PPP loans or are feeling comfortable with current orders, as economist Tom Cunningham pointed out so pointedly on a call on Friday, most of the government support is in the form of bridge loans; the problem is we don’t know how long the bridge needs to be. If we are going to be in this limbo for 12 to 18 months, the loans are not long enough, and many will not survive. Bankruptcies have already wreaked havoc on the economy and are not slowing down. State and local governments, which account for 60% of government-generated GDP, are in a terrible state and will be shedding workers and cutting services as they struggle to survive. The ripple effects will continue. Be prepared.

As I and many have pointed out, COVID is an accelerant. We are now five to ten years ahead in our industries, so are you positioned for such a place? Darwinism is not survival of the fittest, but those ablest to adapt to the new environment. Start adapting. Expand your market and potential client-based. Review processes to see if they can be more efficient.

Not only should you review your business, but also your personal life. COVID is not the flu, it is horrible, and those that survive will in many cases, not have an easy time going forward. Thus, look at your relationships with your parents, spouse, significant other, children, close friends. Are they where you would want them in five to ten years, and if not, make them so. The window to do so may not be as open as you think.

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Ideation! Harder Than It Sounds

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Are you ready for the Talent Crunch?

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Put Your Oxygen Mask On First

Put Your Oxygen Mask On First

We all know the flight attendant’s instructions to “put your oxygen mask on first,” before helping others. Why is this an essential rule for ensuring survival? Because if you run out of oxygen yourself, you can’t help anyone else with their oxygen mask.

In a corporate environment, I consider this to ensure that the business model and processes are working before embarking on a new venture, product, or market. With COVID, I see several CEOs, moving their organizations in new directions without the company having its core culture, business model, and processes working. With COVID, all CEOs are now what Ben Horowitz referred to as “Wartime CEOs.” To understand the difference, read Horowitz’s Peacetime CEO/Wartime CEO. However, as a wartime CEO, you need a robust organization framework to provide the agility to win.

Without a robust framework, it will be difficult to:

  • know what is driving any change in performance;
  • push decision making down the chain of command;
  • be agile in responding to market conditions; and
  • make informed decisions.

Many companies have problems with their culture, business model, processes, or just the wrong employees. As I have said before, COVID is ripping back the curtain and exposing these weaknesses. Business leaders don’t have the luxury of ignoring them anymore.

Many CEOs I know have avoided addressing the problems within their organizations for years as the growing economy helped paper over them, and I think they hoped the issues would right themselves with time. This failing to deal with the difficult choices is a failure by these leaders because dealing with hard decisions is why they get paid the big bucks. As Ben Horowitz so aptly put it, CEOs make decisions that not everyone agrees with, because if everyone agreed, then they wouldn’t need the CEO. Now is the time for many business leaders to face those hard decisions and do what is right for the organization.

Examples I see are that plague some companies are:

  • Wrong people in the jobs they have. They need to be moved
  • No core values or corporate culture. During COVID there are more crises because “the employees are not stepping up.” This will get worse.
  • Bad financial reporting. You can’t change direction and know the results if your financials are 6+ months late or usually wrong.
  • No idea about the underlying product or service costs. Thus focusing on nonprofitable items and clients during a cash crunch.
  • Headquarters in another country has to approve all online content and publish the website and online stores; however, they are distracted and don’t understand the U.S. market. In this instance, there is no agility, which is essential.

If you are struggling with this, I would recommend joining a Peer Group like Vistage and presenting the issue to your Peers. When I was a Vistage member, I found the advice was what I deep down usually knew was needed, but hearing it from my Peers provided me no choice but to commit to something I was avoiding. Also, I would have to do it, as I could not face them again, having committed to doing it, but then backing out. As I tell Vistage prospects, “there is no public flogging in Vistage, but monthly humiliation in front of your peers may be worse!”

While COVID is creating chaos in many companies, business leaders need to ensure they have repaired their underlying problems first before trying to adapt. As the old French proverb says, “A stitch in time saves nine.”

 

Copyright (c) 2020, Marc A. Borrelli

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Sunk Costs Are Just That, Sunk!

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Ideation! Harder Than It Sounds

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Recruit, Recruit, Recruit!

Recruit, Recruit, Recruit!

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We All Need Clarity

We All Need Clarity

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Not Another **** Meeting

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Is Your Company Scalable?

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Are you ready for the Talent Crunch?

Companies are gearing up to hire. Unfortunately, many are competing within the same talent pool. Some experts are currently predicting a strong economic recovery starting in May or June. But as the economy booms, there is going to be fierce competition for talent. How will you fare in the looming talent crisis? Your organization should be creating a plan, now, so you can attract the talent you need in the year ahead.

Where are you?

Where are you?

Last week I discussed how business trends had accelerated 5 – 10 years as a result of COVID, thus whatever the critical trends in your business were in March, take them forward 5 – 10 years, and that is where you are now. This acceleration applies to all companies, but the ones we see most easily are move to online retailing and the death of malls.

If that is where your business is, then as I have also said before you need to:

  • Revisit your BHAG. Hopefully, you have one, and make sure it is still relevant. Your Big Hairy Audacious Goal is more than just “goals,” a true BHAG is clear and compelling and serves as a unifying focal point of effort– often creating immense team spirit.  It has a clear finish line, so the organization can know when it has achieved the goal; people like to shoot for finish lines. However, if your BHAG aimed at ten years out, and we have moved 5 – 10 years in the last few months, we may have passed, or it may no longer be relevant.

  • Review your corporate mission and vision statements, again to ensure they are correct given where everything has moved;

  • Look at your “Why.” Is it relevant in a COVID/post COVID world, or does it need changing? Is it a “Why” that has relevance with your future workforce. If you are not sure about your “Why,” here is a link to Simon Sinek’s “Start with your Why” as a refresher. Millennials are here, and regardless of what you think about them, you need them. The good ones will want to work of organizations where they believe in its “Why.” Now is the time to fix it.

  • Take a hard look at your Corporate Culture, is what you live, or are they just pretty words? I have come across many examples over the last twelve weeks were organizations are flouting their cultural beliefs and not even realizing it. Look at your behaviors during this period and have you lived your culture. If not, you need to change one or the other.

  • Develop a new strategy – urgently! As I have said before, not only have we moved forward 5 – 10 years, but the game has changed. There are new rules and players. Thus you need a new strategy.

  • Revisit your capital investment plans. With a new strategy and market, your prior capital priorities are not necessarily correct. You need to revisit your investment plans and ensure that you are focused on investing in technology and processes to keep ahead of your competition.

  • Revisit “How You Make Money.” How You Make Money is a fundamental understanding of every employee in an organization. It must be something simple that everyone understands but drives the appropriate decisions making and behavior. Herb Keller at Southwest Airlines put it best with “Wheels Up.” So how do you make money, and has it changed in this new environment?

  • Revisit your capital allocation. Right now, interest rates are at an all-time low and should remain here for some time. With lower interest rates you need to revisit your capital structure, assets and operations to determine the most efficient capital allocation from a cost of capital and tax perspective and

  • Revisit your operations. Taxes are at an all-time low, but I don’t expect them to remain so as the significant increase in government debt will need financing at some point. So look at your operations and some assets, should you sell them now and reinvest the proceeds more efficiently, given where we are. One of my clients is about to sell his office building and is looking to do a 1031 exchange into a new investment property. While that is the standard consideration; however, if you expect taxes to rise and value of investment property to rise more slowly as the world adjusts to the post COVID landscape, would it be better to pay the taxes now. That is a question each person needs to determine, but one I would ask.

  • Revisit your decisions making process. As we move through a time of significant change and confusion, you need to move the decision making down from the top to where the information is. As I have said before, this is a time for effectively A/B testing outside of just the software world. Having everything flow up and down through the organization slows the decision-making process down too much for such times. To have effective decision making at the front lines, your employees need to know the Mission, VIsion, your Why, How You Make Money, and the Company’s Culture. If they genuinely understand those, they will make the right decisions for the organization.

The most beautiful thing about the current environment is you can change all of these things without too much of an issue. Because of COVID and the adjustments required, Scared Cows can get slaughtered. Prior commitments and beliefs that could not be touched are fair game.

Now is the time to implement John Boyd’s OODA Loop – observe–orient–decide–act.

While developed for military strategy, this is an ideal OODA loop environment. An organization that can process this cycle quickly, observing and reacting to unfolding events more rapidly than the competition, can “get inside” the opponent’s decision cycle and gain the advantage. Raw information or observations of the evolving situation are processed or filtered to drive all decisions regarding the problem.

While everyone is still figuring out what is happening, take advantage of the confusion and move quickly. Those organizations that emerge ahead for this crisis will have market leadership for the next decade.

 

Copyright (c) 2020, Marc A. Borrelli

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Do You Understand Your Costs to Ensure Profitability?

You can only determine profitability when you know your costs. I’ve discussed before that you should price according to value, not hours. However, you still need to know your costs to understand the minimum pricing and how it is performing. Do you consider each jobs’ profitability when you price new jobs? Do you know what you should be charging to ensure you hit your profit targets? These discussions about a company’s profitability, and what measure drives profit, are critical for your organization.

Sunk Costs Are Just That, Sunk!

Sunk Costs Are Just That, Sunk!

If you were starting your business today, what would you do differently? This thought-provoking question is a valuable exercise, especially when it brings up the idea of “sunk costs” and how they limit us. A sunk cost is a payment or investment that has already been made. Since it is unrecoverable no matter what, a sunk cost shouldn’t be factored into any future decisions. However, we’re all familiar with the sunk cost fallacy: behavior driven by a past expenditure that isn’t recoupable, regardless of future actions.

Do You REALLY Know Your Business Model?

Do You REALLY Know Your Business Model?

Bringing clarity to your organization is a common theme on The Disruption! blog. Defining your business model is a worthwhile exercise for any leadership team. But how do you even begin to bring clarity into your operations? If you’re looking for a place to start, Josh Kaufman’s “Five Parts of Every Business” offers an excellent framework. Kaufman defines five parts of every business model that all flow into the next, breaking it down into Value Creation, Marketing, Sales, Value Delivery, and Finance.

Ideation! Harder Than It Sounds

Ideation! Harder Than It Sounds

Bringing in new ideas, thoughts, understanding, and logic is key as your organization faces the challenges of a changing environment. But when you do an ideation session in your organization… how does it go? For so many organizations, many times, after a few ideas have been thrown out and rejected, the thought process slows down very quickly, and a form of hopelessness takes over. How does your organization have better ideation? I’ve come across a new approach with a few teams lately.

Recruit, Recruit, Recruit!

Recruit, Recruit, Recruit!

An uptick in business has begun this quarter, and companies are rushing to hire to meet this surge in demand. What amazes me is how many are so unprepared to hire. Continual recruiting is key to the survival of a company. It isn’t the same thing as hiring—continuous recruiting is building a pipeline of people that you would hire if you needed to fill a position, or “A players” you would hire if they were available.

We All Need Clarity

We All Need Clarity

If your organization is focused on obscurity over clarity, whether intentionally or not, your “A” player employees are vulnerable. There is a looming talent crunch. As we start to emerge from COVID, demand is increasing, and many are scrambling to fill positions to meet that demand. Headhunters and recruiters are soon going to be calling your key “A” employees. Have you been giving them a reason to stay?

Not Another **** Meeting

Not Another **** Meeting

As Leonard Bernstein put it so well, “To achieve great things, two things are needed: a plan and not quite enough time.” Your meetings can be shorter, more fruitful, and engaging, with better outcomes for the organization, employees, and managers. It’s time to examine your meeting rhythms and how you set meeting agendas. This week, I break down daily, weekly, monthly, quarterly, annual, and individual meeting rhythms, with sample agendas for each.

Is Your Company Scalable?

Is Your Company Scalable?

Let’s start here: Why should your company be scalable at all? If your business is scalable, you have business freedom–freedom with time, money, and options. Many business leaders get stuck in the “owner’s trap”, where you need to do everything yourself. Sound familiar? If you want a scalable business that gives you freedom, you need to be intentional about what you sell, and how.

Are you ready for the Talent Crunch?

Are you ready for the Talent Crunch?

Companies are gearing up to hire. Unfortunately, many are competing within the same talent pool. Some experts are currently predicting a strong economic recovery starting in May or June. But as the economy booms, there is going to be fierce competition for talent. How will you fare in the looming talent crisis? Your organization should be creating a plan, now, so you can attract the talent you need in the year ahead.

You Should be Excited!

You Should be Excited!

Having a conversation with a Vistage member this week, he said, that while COVID was terrible from a point of deaths and financial damage, it was exciting. I agree! Business owners and CEOs don’t have to work on eking out an additional few points of revenue or margin in the same manner year on year. Whatever your business plan was on March 1st, that is now in the shredder. If you pivoted in December and invested in resources, those may be to use a economist’s term, sunk costs. You need a new business strategy and plan!

As Rahm Emanuel said, “You never let a serious crisis go to waste. And what I mean by that is it’s an opportunity to do things you think you could not do before.” COVID provides CEOs with many opportunities that were unavailable before. Organizations can:

  • pivot their strategy;

  • enter new markets that didn’t exist four months ago;

  • obtain talent that was once unreachable;

  • acquire companies that fit their strategic goals;

  • cut sacred cows, whether they are people, division, or products.

  • move quickly without some of the usual inbuilt restrictions

  • try lots of new things in a continuous A/B testing format.

For a great example, I look to Scott Cowen, President Emeritus and Distinguished University Chair of Tulane University who was President when Hurricane Katrina hit. A little like COVID, one day he was welcoming the class of 2009 to a university with 5,000+ students and thousands of employees, and three days he told the thousands of students and families to turn around and get out. A week later he students and employees all over the country, a city in disarray, a large amount of uninhabitable housing for students, employees many of the services needed by employees no longer available.

“In many ways, Katrina wiped the slate clean,” Cowen said. Cowen led a rebuilding and academic reorganization of Tulane through a rebuilding and academic reorganization, Many of his actions were criticized including the decisions:

  • to merge and eliminate Newcomb College wholly into Tulane, to form a new undergraduate college, Newcomb-Tulane College.

  • to eliminate several departments in the School of Engineering and merge its remaining departments with the science departments in the School of Liberal Arts and Sciences to form a new School of Science and Engineering and a restructured School of Liberal Arts.

Tulane also became the first and only major private research university to incorporate public service into its core curriculum. Many of these things were impossible without the crisis provided by Katrina. Also to house students during the cleanup he chartered a cruise ship and had them docked in the Mississippi to provide housing for students.

As I received my MBA and JD from Tulane, I had the opportunity to hear Scott talk a number of times as he developed and executed his new strategy for Tulane. His concern but excitement and vision during this period were amazing and I was in awe of him and what he had accomplished.

Right now many firms are living their equivalent of Apollo 13, the key to make it “our finest hour.”

 

Copyright (c) 2020, Marc A. Borrelli

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Not Another **** Meeting

Not Another **** Meeting

As Leonard Bernstein put it so well, “To achieve great things, two things are needed: a plan and not quite enough time.” Your meetings can be shorter, more fruitful, and engaging, with better outcomes for the organization, employees, and managers. It’s time to examine your meeting rhythms and how you set meeting agendas. This week, I break down daily, weekly, monthly, quarterly, annual, and individual meeting rhythms, with sample agendas for each.

Is Your Company Scalable?

Is Your Company Scalable?

Let’s start here: Why should your company be scalable at all? If your business is scalable, you have business freedom–freedom with time, money, and options. Many business leaders get stuck in the “owner’s trap”, where you need to do everything yourself. Sound familiar? If you want a scalable business that gives you freedom, you need to be intentional about what you sell, and how.

Are you ready for the Talent Crunch?

Are you ready for the Talent Crunch?

Companies are gearing up to hire. Unfortunately, many are competing within the same talent pool. Some experts are currently predicting a strong economic recovery starting in May or June. But as the economy booms, there is going to be fierce competition for talent. How will you fare in the looming talent crisis? Your organization should be creating a plan, now, so you can attract the talent you need in the year ahead.