Information Overload: An Urban Myth?

I just listened to a fascinating webinar in which five authors recounted their experiences, both personal and professional, with information overload.  One of the speakers, Jonathan Spira, reports that he has measured this phenomenon, and that it costs the US economy over $1 trillion per year!

Shifting the blame

But in naming the phenomenon ‘information overload’, it seems to place the blame on the information—not on ourselves, where it belongs.  People bemoan the distractions offered by ubiquitous information devices like smart phones and tablets—similar to the complaints that were made when the telegraph and the printed book were introduced!

This seems to us like blaming obesity on food.  “Gee, there’s so much food out there, if I ate it all, I’d get really fat.”  (Yes, you would…and with an obesity rate running over 30% in many US states, some people appear to be trying to do just that.)  If we were to talk about obesity as a food overload, it would sound pretty silly.  Though our general abundance is certainly an enabling factor, most people realize that you have to eat intelligently and selectively to stay healthy.

Maybe what we’re all experiencing is better described as collective attention deficit, or of being focus-challenged.

The information metabolism

all-you-can-eat_25Organizations have this problem too, and typically don’t fare much better.  In my article “The Information Metabolism” (Competitive Intelligence Review, Fall 1995), I compared the intake and processing of information to the intake and processing of food—eating and digestion. Though my tone was whimsical, I was only half-kidding.   I believe they are closely analogous, as my article described:

Some organizations are ‘information starved’…Others are ‘fat’ with information—they acquire it, but can’t use it effectively to create value.  Still other organizations ‘binge’ on information—they get lots of it at certain times (like strategic planning season), but not enough the rest of the time.

This was written at the dawn of the Internet Age, and the situation has accelerated dramatically since then.  I’ve seen this up close in companies, and it can be quite distressing.  Some are literally awash in so much data that it erodes their ability to process and use it effectively to manage their business.

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Rebalance Your Knowledge Portfolio

If you have any experience with investing, you know about rebalancing your portfolio.  Every so often—at the end of every year, say—you need to reassess your investments.  Some may have grown, such that you’re too heavily invested in a particular stock or sector in the economy.  In other areas, you may find that you have less invested than you would like, given the prospects for another higher-potential sector.

Why do we need to do this?  Because the world changes, and the asset mix may no longer meet our needs.  I may feel that the economy is risky, and I’d rather be more invested in safer things like bonds than stocks.

In addition to the ebb and flow of securities prices, my needs may also change.  I may need to take out money for my child’s education, or for other unexpected expenses.  I may feel that I’d rather have more insurance.

The knowledge portfolio

It’s much the same way for organizational information and research assets.  They are financial investments—not costs—and each one brings to the organization a return in the form of optimized decisions and business results.  I find it helpful to think of all the research, information, and intelligence in an organization as its ‘knowledge portfolio’, with each research initiative, report, and staff position representing a specific asset in that portfolio.

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Willful Ignorance

Stop me if you’d heard this one.

“[COMPANY] is in the final stages of preparing a bankruptcy filing, clinching a long fall for a company with humble beginnings that helped change the way Americans buy [PRODUCT], but failed to keep pace with the [CHANGE] rocking every corner of the [INDUSTRY] landscape.”

Today (February 12, Wall Street Journal) the missing words are ‘Borders’, ‘books’, ‘digital transformation’, and ‘media’, respectively.  Tomorrow there will be another company in another industry that pays the ultimate price for not “seeing” what has been going on for some time.

Borders

I put seeing in quotes because seeing has two major dimensions—perceiving what is happening at an organic level on the one hand, and incorporating it into a world view and subsequent actions on the other.  Social scientists have long documented that cognitive dissonance, the human mind’s ability NOT to perceive what it finds contradictory or threatening, is a powerful force.

We like to think that organizational intelligence is the eyes and ears of the organization, and in a very literal sense it is just that.  But what the eyes and ears capture—physical sight and sound—must be processed by the human brain in order to yield meaningful images.  Likewise, so must relevant signals in the competitive environment not only be swept in by the organization’s eyes and ears, but also processed and analyzed by a sense-making and action-taking capability.

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Competitive dynamics: a basic typology

“I love you, you’re perfect…now CHANGE.”  That’s what the market in effect continually tells high-achieving companies—because the world always changes around them.

Companies tend to do best today what they did best yesterday…not what they’ll need to do best tomorrow.

In working with companies of various sizes, in various industries, I’ve noticed that the most significant strategic challenges are those brought on by some fundamental type of industry change.  Anticipating and adapting to industry change is at the heart of what competitive strategy is.

I’ve also noticed that not all industry changes are of the same magnitude or carry the same degree of strategic implications.  I’ve begun informally categorizing these changes with regard to their impact on industry players.  We’ll call these—in ascending order of how difficult they are to manage successfully—Levels 1, 2, and 3.

Level 1 industry change – “New kid in town”

In a Level 1 industry change, a major player enters or leaves the industry.  This could be a major buyer, a major competitor, or a major supplier for the industry.

WB recardsExamples of Level 1 change abound, and you can usually pick up a financial journal at random and find one.  I just now did exactly that, and find two pages into my search an article reporting that Warner Music Group is selling its music publishing business (leaving one less player there), in hopes of clearing anti-trust to be able to buy the foundering EMI (leaving one less player there as well).  EMI owns, among other assets, the master recordings by my all-time favorites, the Beatles.

Level 1 changes can require significant adjustments in any industry.  However, relative to other types of industry change, the impact of a Level 1 change on existing other players is low.

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Competitive myopia

I recently had a conversation with the publisher of a start-up niche business-to-business magazine.  We had pointed out several things that we felt were opportunities for him.  For one, our view—confirmed with some informal research—that the “look and feel” of his product was not what it could be, and that with a small investment, he could bring it up to the much higher standard we feel he needs.

His reply was that, even though he’s always interested in making improvements, they weren’t needed here.  The reason?  He had just met with his chief rival, the CEO of another similar publication, and they both had agreed that my client’s product had the better approach.

This illustrates perfectly what in my experience is one of the most common hazards of conventional competitive intelligence—one I’ll call competitive myopia. Competitive myopia is defined as a focus on a competitor or rival that is so intense that it causes distraction from larger strategic threats or opportunities.

BearCompetitive myopia results in a mindset that says:  If we just manage to beat the other guys, we’ll do fine in our market.  “I don’t have to outrun the bear,” goes the joke about the two men meeting the hungry bear in the woods.  “I just have to outrun YOU.”

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