Error propagation and extinction

One of my minor neuroses is an aversion to propagating errors of fact or logic. Indeed, I have to apply teeth to tongue at times when witnessing others propagating error. Managing this quirk productively is an important part of pedagogy, as experienced MBA instructors will immediately recognize. (Note that you will have many more opportunities to correct errors than to answer questions, because part of not understanding something is often not realizing it.)

Knowing when to pull the trigger on a correction to an error is the most subtle aspect. The first-best solution is another student immediately chiming in with an on-point critique, but that happens rarely. A lightly guided discussion that eventually corrects the error is next best, but there are practical challenges here as well, since a) limited class time may be available to deal with the topic, b) it can become aggravating for the students to play “guess what the professor is thinking,”, and c) the longer the uncorrected statement lies there the more likely that students will internalize the error and repeatedly spout it back in future classes, on exams, etc.

Assuming one has let the error go uncorrected as long as seems prudent and decided to directly intervene, it’s still often a challenge to a) precisely recognize the nature of an error and b) quickly come up with a concise, memorable, and understandable correction that will persistently displace the erroneous idea from the audience’s minds. Of course, experience helps, because errors tend to fall into repetitive patterns, allowing you to build up an internal database of diagnoses and appropriate responses. Here are some classic sallies with proposed responses below the fold. Suggested improvements to these responses (as well as additional examples of “favorite errors”) are welcomed in the comments.

1. “The company has a cost advantage because it makes more products and there are economies of scope in this industry.”

2. “The company has a cost advantage because it’s more vertically integrated (and Porter says that reduces costs).”

3. “The company has a cost advantage because it outsources more activities.”

4. “There are strong entry barriers because small companies can’t afford to pay the capital costs to operate in the industry.”

5. “The company needs to give better deals to its loyal customers.”

6. “The big growth in this industry comes from this new segment X, so the company should focus its resources on penetrating X.”

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Does This School Make Me Look Fat?

It appears that selling “competitive” foods–often called junk foods–in schools has little market-expanding effect, at least if we use childhood obesity as a measure. The authors of this study look to have used pretty robust methods and found no link between attending a middle school where such marketed foods are sold and obesity. So firms’ efforts to penetrate these schools probably represent zero-sum market-share battles among brands, not a means of stimulating overall long-term consumption of these products.

Bonus question: If food firms make competitive bids to schools in order to get exclusive access (and I have no idea whether that is true–I’m analogizing from the many college campus exclusive soft-drink deals), then how would they feel about regulations banning them from school premises? Hint: Think about the impact of taking cigarette advertising off of TV on cigarette firm profits.

Fraud and the Road to Abilene

Over the weekend, an (anonymized) interview was published in a Dutch national newspaper with the three “whistle blowers” who exposed the enormous fraud of Professor Diederik Stapel. Stapel had gained stardom status in the field of social psychology but, simply speaking, had been making up all his data all the time. There are two things that struck me:

First, in a previous post I wrote about the fraud, based on a flurry of newspaper articles and the interim report that a committee examining the fraud has put together, I wrote that it eventually was his clumsiness faking the data that got him caught. Although that general picture certainly remained – he wasn’t very good at faking data; I think I could have easily done a better job (although I have never even tried anything like that, honest!) – but it wasn’t as clumsy as the newspapers sometimes made it out to be.

Specifically, I wrote “eventually, he did not even bother anymore to really make up newly faked data. He used the same (fake) numbers for different experiments, gave those to his various PhD students to analyze, who then in disbelief slaving away in their adjacent cubicles discovered that their very different experiments led to exactly the same statistical values (a near impossibility). When they compared their databases, there was substantial overlap”. Now, it now seems the “substantial overlap” was merely a part of one column of data. Plus, there were various other things that got him caught.

I don’t beat myself too hard over the head with my keyboard about repeating this misrepresentation by the newspapers (although I have given myself a small slap on the wrist – after having received a verbal one from one of the whistlers) because my piece focused on the “why did he do it?” rather than the “how did he get caught”, but it does show that we have to give the three whistle blowers (quite) a bit more credit than I – and others – originally thought.

The second point that caught my attention is that, since the fraught was exposed, various people have come out admitting that they had “had suspicions all the time”. You could say “yeah right” but there do appear to be quite a few signs that various people indeed had been having their doubts for a longer time. For instance, I have read an interview with a former colleague of Stapel at Tilburg University credibly admitting to this, I have directly spoken to people who said there had been rumors for longer, and the article with the whistle blowers suggests even Stapel’s faculty dean might not have been entirely dumbfounded that it had all been too good to be true after all… All the people who admit to having doubts in private state that they did not feel comfortable raising the issue while everyone just seemed to applaud Stapel and his Science publications.

This reminded me of the Abilene Paradox, first described by Professor Jerry Harvey, from the George Washington University. He described a leisure trip which he and his wife and parents made in Texas in July, in his parents’ un-airconditioned old Buick to a town called Abilene. It was a trip they had all agreed to – or at least not disagreed with – but, as it later turned out, none of them had wanted to go on. “Here we were, four reasonably sensible people who, of our own volition, had just taken a 106-mile trip across a godforsaken desert in a furnace-like temperature through a cloud-like dust storm to eat unpalatable food at a hole-in-the-wall cafeteria in Abilene, when none of us had really wanted to go”

The Abilene Paradox describes the situation where everyone goes along with something, mistakenly assuming that others’ people’s silence implies that they agree. And the (erroneous) feeling to be the only one who disagrees makes a person shut up as well, all the way to Abilene.

People had suspicions about Stapel’s “too good to be true” research record and findings but did not dare to speak up while no-one else did.

It seems there are two things that eventually made the three whistle blowers speak up and expose Stapel: Friendship and alcohol.

They had struck up a friendship and one night, fuelled by alcohol, raised their suspicions to one another. And, crucially, decided to do something about it. Perhaps there are some lessons in this for the world of business. For example, Jim Westphal, who has done extensive, thorough research on boards of directors, showed that boards often suffer from the Abilene Paradox, for instance when confronted with their company’s new strategy. Yet, Jim and colleagues also showed that friendship ties within top management teams might not be such a bad thing. We are often suspicious of social ties between boards and top managers, fearful that it might cloud their judgment and make them reluctant to discipline a CEO. But it may be that such friendship ties – whether fuelled by alcohol or not – might also help to lower the barriers to resolving the Abilene Paradox. So perhaps we should make friendships and alcohol mandatory – religion permitting – both during board meetings and academic gatherings. It would undoubtedly help making them more tolerable as well.