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Aviate, navigate, communicate to keep your business flying

By Daniel F. Muzyka and Darcy Rezac

One dark night in 1972, the cockpit crew of Eastern Airlines flight 401, on approach to Miami International Airport, noticed an undercarriage warning light. All three pilots began focusing on the warning light and no one was left flying the plane. Was it really a problem with the landing gear, or was it a faulty light bulb? All three became "task fixated," with one of them unintentionally disconnecting the autopilot while solving "the problem." Flight 401 descended into the Everglades swamp, killing 101 people. Investigators discovered it was a burned-out bulb.

The accident led to changes in worldwide airline procedures: Now there must be a designated "pilot flying." Pilots are taught three priorities: Aviate, navigate and communicate. In other words: Fly the airplane; continuously scan the instruments, always know where you are and where you are going (situational awareness), and communicate clearly. Good advice for us all.

Given the current economic slowdown, companies do need to be more concerned about the numbers. However, executives of otherwise healthy companies have to be careful that they don’t trigger unintended or extreme outcomes by singularly focusing on one thing only – such as cash flow and/or profitability – to the detriment of everything else. We have become increasingly concerned that increased task fixation is setting in for business executives, leading to potential harm for their companies and stakeholders, as has happened in past downturns.

Why is this happening? First, various gurus have called for executives to "focus" and "stick to their knitting." Second, in an increasingly complex world, narrowing focus has been one way executives have decided to cope. Third, the recent downturn in the economy has further accelerated "focus" on the bottom line as more businesses have pulled back to weather the storm. Finally, task fixation may be increasing as a result of the need for quick impact by executives facing shortening tenures in their posts.

Why do some enterprises seem to fly through storms and come out stronger while others seem to lose their situational awareness and begin a long spiral downward? Management has been known to overreact to downturns, sacrificing future business through excessive inventory and service cuts. Some teams have also gone further and curtailed projects – often a prudent measure – but without real evaluation of the impact on long-term growth, innovation and renewal. Other teams have persisted in their plans, selectively cutting back while pursuing opportunities and key structural projects in a focused fashion. Finally, recession-led changes in effective corporate cultures have reduced necessary risk-taking in some organizations, while this trend was better managed in others.

What makes matters worse, however, is the reality that uncertainty and focused messaging can act to enhance known human decision-making biases. Research has shown that we are inherently flawed in our decision process.

Decision-making biases are well documented, and many of them are made worse in the face of increased uncertainty – as in the current environment – and narrowed focus. Executives can unintentionally play to these biases, yielding short-term and long-run harm for their organizations.

Biases often come into play under uncertainty and pressure. First, managers have a tendency to view situations as unique when many aren’t, thereby ignoring valuable history. Second, managers tend to have somewhat conflicting biases where they have unjustified optimism in plans and unreasonable risk aversion, made worse under the circumstances. Third, managers have a tendency to view decisions in a narrower and more short-term frame, especially in light of short-term performance pressure. Again, managers need to ask the question: "Is anyone flying the plane?"

Many biases are related to the concept of risk, especially when enhanced by the absolute need to deliver "hard numbers." Decision makers can be willing to bet heavily to avoid a loss, becoming real risk takers at times while shying away from risks inherent in upside opportunities; value certain outcomes over probable outcomes (a bird in the hand is worth two in the bush); view risk taking as lacking organizational incentives (incentives that are certainly lacking in the growing panic); and see risks individually rather than as a portfolio, thereby overemphasizing the downside.

So what can we do about it? From the perspective of planning, build and maintain a suitably broad vision for the future of the organization that permits and encourages a focus on growth and adaptation. Don’t start with a narrow focus or that is where you will end up, especially by fuelling management biases. To accompany this vision, ensure the management team has worked through some scenarios to achieve the vision and you collectively understand what initiatives you are willing to trade off, and which you are not. Furthermore, you may want to increase focus in areas with limited prospects while maintaining aspirational efforts and investment in other areas. In other words, fly the airplane. Good communication with well-targeted messaging is vital. Appropriate focus, not task fixation, is the objective.

Some suggestions. First, ensure that forgone opportunities are valued and factored into decision making. Second, take a page from the practices of successful entrepreneurs with increased scanning and maintaining of situational awareness in the face of uncertainty: Opportunities, problems and changes in assumptions are all about us. Third, ensure the articulation and implementation of a broad set of measures, balancing the need to survive and thrive in the short, medium and long run.

Finally, let’s get personal. You need to maintain a broad, calm perspective yourself. Overreacting and further focusing efforts is not always the right solution. Your increased risk aversion will only multiply in the hands of others. Also, you need to maintain a balanced view of the short term and the long term on your part, and that of the organization. Finally, you need to be adaptive in your perspective, lest you become part of the problem, rather than its solution.

Aviate, navigate, communicate. Let’s not let a burned-out light bulb bring down the business.

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