Mental models and business behaviour

9.10 Mental models and business behaviour

In Chapter 8, we considered the concept of ‘a mental model’. How does this relate to one’s own business endeavours? Simply this, the reason why so many businesses fail is that business managers have a fixed mental model about the nature of the business and the work they are trying to do, irrespective of the market intelligence, financial models and other data being offered. If it doesn’t fit their current mental model they will reject it, either irrationally (because they will say they do not like what they are hearing) or rationally (by saying the data are wrong).

We know from our own experiences that the action of monitoring an event or a condition gives us information to allow us to act. In the jargon, this is known as a ‘feedback loop’. Negative feedback acts as a controlling mechanism; a thermostat on a central heating system provides negative feedback inasmuch as when the temperature rises to a fixed point, it then shuts down the boiler. Similarly, the governor on a steam engine, whether in

a science museum or in a still-working model, acts as a release for the pressure to maintain the boiler at an acceptable fixed pressure level. Positive feedback would amplify and exacerbate these particular circumstances. Consider the image of an army troop marching across a bridge and having to break step so that the rhythm of their marching feet does not act as an amplifying effect on the bridge and make it fall down, or the new footbridge over the Thames that closed a few days after opening because the swaying rhythm of the bridge made the pedestrians fall into step, which further amplified the swaying. Feedback is all about providing the mechanisms of control with information from the environment. These feedback loops are just as important in the business environment. The key model for this book (Figure I) shows cyclical events and interractions; these are essentially a whole series of feedback loops.

As Chapter 8 suggests, complex learning is all about being able to change the mental model, the frame of reference, paradigm or mindset of the individual or the organisation. It is an essential stepping stone in the ability to manage and control business processes. This ability to shift the frame of reference keeps an organisation agile enough to cope with change yet still function effectively. There are many theories and illustrative industry case studies of how companies lock themselves into ways of working that become routine and predictable.

Managing in the Media

Given the level of uncertainty, it is particularly difficult to gain insight into the business behaviour of people in the audiovisual industry. The most satisfactory interpretation of those involved in creative endeavours seems to

be found in chaos theory.

Chaos theory – always on the edge of catastrophy?

A scan of the literature of personal memoires and ‘war stories’ of media moguls reports a working environment dominated by egos, ambitions and intuitive (irrational?) behaviours. John Harvey Jones, in a special edition of his Trouble Shooter programme, suggested that the UK independent television

industry was ‘not a business at all’ 12 . The audiovisual industry requires people to be creative and innovative, and this has to take place within the bounds of a system that requires a product to be completed and distributed. The dynamic between a stable and unstable environment requires managers to provide ‘bounded unstable’ working conditions for their teams. A highly stable, routinised environment does not lead to creativity, and a highly unstable yet energised creative environment will probably not lead to a completed product. The idea of bounded instabilty has its basis in chaos theory. The principle is that of hidden order in a seemingly random and uncontrolled environment. These hidden patterns provide the controlling mechanisms to differentiate a system from a purely random association.

To illustrate this concept, consider a jazz group. They begin the piece with written music, they then move into known patterns and ‘riffs’, and the virtuosos then improvise for a period. As the improvised sessions come to

a close, the group (without a conductor or obvious signals) come together to finish the piece. All the musicians taking part know what is happening, and the audience hears more than a random sequence from a group of musicians. There is hidden order through time signature, key and repeated riffs or patterns. The piece remains a whole, even though some elements might be a unique offering on the day. The ideal production environment should provide this mix of creative control.