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the positive

in the

negative

February 1, 2023

Every leader is on the spectrum from pragmatist to optimist depending on the relationship and issue.

While I was still in high school in the early '80s, my mother started her first venture. It phoenixed out of the ashes of a failed marriage and a career in the imploding mortgage business. As a single mom facing 21% interest rates by herself, she established her new business as an act of both profound necessity and profound boldness. She had teenage sons to feed. "Nothing ventured, nothing gained", she would always say to me and my brother, as a clear counterpoint to the less positive, "nothing ventured, nothing lost." If she truly understood the kind of suffering and struggling coming her way as a result of that choice, she might have lost the will to even try. But she ignored all that. A classic entrepreneur. I don't recall a single whiff of insecurity or anxiety over money. She fought through it and prevailed. Her spirit animal is the tiger.

"Once more unto the breach, dear friends...then imitate the action of the tiger."

Many years of self-employement after that conditioning, I began my study of cognitive biases, behavioual economics and neuropsychology. I'm a hack but a curious one. I learned about confirmation bias and how fear of loss can derail people. Humanity evolved and flourished in no small part to a resident negativity bias. Your and my paleolithic ancestors made effective practice of running away from dangerous situations and lived to procreate. The presumption that something unknown is probably bad turns out to be a better survival strategy. But that mindset didn't build the world. Every single aspect of the built world you see around you was instigated by people like my mother–people who somehow managed to transcend the negativity bias long enough to get something new "and dangerous" out of their imaginations and into viable plans of action.

Innovation requires an initial period of willful blindness.

Positive and negative, despite a lazy social conflation, are not synonymous with good and bad. Positive is the choice, out of habit or bias, to see the presence of something. Negative is its absence. (If you were being tested for the presence of a life-threatening desease, you'd want the result to come back negative, which would be a good result.)

There are two kinds of error we can make when making strategic judgements, like the choice to launch a new business venture. One is a false negative–withdrawing from what would have been a spectacular success out of fear and self-doubt. The other is a false positive–stubbornly pursuing a bad idea, despite the warning signs and evidence, and going bankrupt as a result. These are also known as Type I and Type II errors.

Danny Kahneman in his seminal work, "Think Fast and Slow", makes the point that biases like negativity are neurologically determined products of evolution that take serious conscious effort to overcome. That makes sense to me. But thirty-five years of supporting entrepreneurs as a design consultant and then coach taught me that it was something else that I had to contend with–something that was perhaps equally dangerous.

I eventually concluded that entrepreneurs either don't have negativity bias or they have something else in their nature that suppresses it or expresses it differently than the rest of people. I think that thing is an optimism bias, which operates on what Steve Jobs called a "reality distortion field". To me, this is a capacity that entrepreneurs have to either deny risk unconciously or ignore it more consciously. If people genuinely understood the risks they were taking and the misery they were going to encounter, many would choose simply to withdraw or never start. All the beautiful functional things in the world would not exist.

There is no innovation that is neither started nor finished. 

This creates an interesting dichotomy of innovators: the entrepreneurs and the executors, the abstract and the concrete thinkers, the visionaries and the strategists, the pull and the push, the yes and the no, the concept and the details, the probability and the consequences.

In effective organizations, the two groups wisely partner with each other. Otherwise nothing interesting would begin and nothing impactful would get done. Neither partner in the process of innovation is superior to the other. It takes an integration of both. The symbiosis is obvious enough to me but this relationship is fundamentally conflicted and is the cause of much stress.

The visionaries are afraid of and thus tend to avoid Type II error: false negatives and errors of omission, also known as opportunity costs. (You can see that in the famous study of eight-year-olds given a marshmallow and the choice to either wait twenty minutes and get a second marshmallow or eat it right away. The budding entrepreneurs in that study would probably eat the first marshamallow, convinced they could talk their way into three more.) To a visionary, the strategists can come across as pessimistic and obstructionist as they avoid opportunities and lock into the threat of a massive catastrophe.

The strategists tend to fear and avoid Type I error: errors of commission and false positives, otherwise known as uncertainy (operational, reputational and financial risk). The visionaries in their minds can be reckless and impulsive as they ignore obvious hazards to everyone's detriment and double-down on "hope as a strategy".

Unfettered optimism triggers rather than overcomes negativity and resistance.

The unwritten history of the world is littered with all kinds of great ideas that went nowhere, chiefly because the Type II visionary innovators failed to listen to the Type I strategic innovators. But those same great ideas went nowhere also because the seemingly more practical Type I innovators ignored the seemingly more capricious Type II innovators.

Great things occur when entrepreneurs and executives learn to listen to each other, understand the polarities of aspirations and concerns and then get over their own biases, whether they are on the same team or in the same body. 

People don't like to hear no all the time and they don't like to take defensive stances and say no all the time.