It’s now over 25 years since Sidney Yoshida first presented his study on the “Iceberg of Ignorance”. It’s not unfair to suggest that the polar ice caps have in that time melted considerably more rapidly than the Iceberg of Ignorance.
The Iceberg of Ignorance
Yoshida’s internationally acclaimed study (The Iceberg of Ignorance) looked at Japanese manufacturing companies. He found that senior management was typically only aware of around 4% of front line problems. These were problems that restricted customers from doing business with the company. On the other hand, frontline staff were generally aware of most of such significant issues. Yoshida found that this differential in turn led to reduced profits of up to 40%.
There is still frequently a chasm between front-line knowledge (and actions) in organisations and central management knowledge. Examples of failures in organisations are too numerous for us to be able to argue that the problem has vanished. Look at the multiple problems in the banking and financial services sector, health, care, food supply and now motor manufacturing. Here we see repeated large scale failings in central management knowledge and controls over behaviour in organisations. Of course, in many of these areas some members of senior management have been complicit – but many have been totally ignorant.
The revolution in technology since Yoshida’s research offers a great opportunity to listen much more readily to both customers and staff. Whether it is on the likes of Trip Advisor, Facebook, Twitter or our own InConfidence feedback mechanisms. Unlike 25 years ago, customers, staff or other stakeholders can give feedback with a few keyboard strokes, shrinking the gap in time and distance.
However, like any technological revolution, these feedback mechanisms are only as good as the use to which they are put.
What can we Learn?
So next time you sit at your senior management table, there are two questions you should be asking to melt that iceberg of ignorance. And unlike the ones which provide habitat for lovely polar bears these icebergs really should be melted.
Firstly – can technology help us to get better feedback from customers, staff and stakeholders, and if so which technology?
The second question applies irrespective of the technology and it is the same question which has applied for decades. In the 21st century our organisations should be reaching a level where we truly tackle it. How do we foster cultures where we don’t hide, shy from, manipulate or side line helpful feedback? How do we embrace it for the good of the organisation and the greater good of its stakeholders?
And if you don’t? Well it may be just over 100 years since the “unsinkable” Titanic sank after hitting an iceberg, but major seemingly unstoppable organisations still seem to do the same with alarming regularity.