www.ExactingEditor.com/PaulNutt.html
 

Author Profiles 2007:
Dr. PAUL C. NUTT (Columbus, Ohio)

Take a serious look -- stage right -- at the cover of Paul Nuttís 2002 book. Preserving so many "debacles" in one gulp appealed to the dark-sider in yours truly. It was late í04, this website was brand new, and I needed a lively, well-researched book to show how a book review can serve reader and author at the same time. The review concluded: "Reading the whole book in one or two sittings will risk brain-lock. Why? Because the quest for generic method is so dominated by the case studies. Youíll do better to...approach Why Decisions Fail as a collection of monographs or magazine articles..." In February 2007, the author e-mailed that heíd like to "debate a few points." The resulting phone call became this Q&A.

For a concise overview of Why Decisions Fail, click here. Fifteen case-study "debacles" give way to complex tables of procedural advice on how to prevent big trouble. Included are the EuroDisney theme-park mess (after CEO Michael Eisner chose France over Spain); the Denver International Airport; Ford's belated recall of the exploding Pinto; and BeechNut's misrepresentation of its apple-juice product (compounded by selling 500,000 cases of its suddenly controversial inventory while it stalled the probe). Nutt's insistence on using awareness and "finding a direction" made me realize how many fanciful projects I got involved in because someone -- perhaps it was me -- moved straight to an IDEA or a DESIGN. When planners make such a leap, the mission becomes to sell the idea or ďfill upĒ the design. In both the non-profit and the for-profit worlds, this kind of rush tends to become one of those "traps" that bring on "debacles."

STYLE and BACKGROUND NOTES: Segments added after the phone taping appear in blue, while anything purple and bolded is a condensation from the original discussion, or a brief quote from the 2002 book to enhance a nearby slice of the dialogue. Finally, hereís a quick listing of all the Paul C. Nutt books and articles, courtesy of the no-hype www.AddAll.net.

A Book to Grab Journalists and Train Practitioners

FRANK GREGORSKY: I found Why Decisions Fail fascinating because, unlike a lot of marketing advisories and management theorists, your case studies acknowledge psychological factors and political dangers [in the wider society]. It is a wonderful synthesis of conventional business tools and these wider factors that come into play anytime a project is going to last for more than a couple of months.

Dr. PAUL C. NUTT: Thank you.

GREGORSKY: How do you come to this public-sector focus?

NUTT: I spent a lot of time teaching in that area -- health-care administration and the Public Management program at Ohio State. Plus I did an awful lot of consulting in the public sector. So I know it relatively well.

GREGORSKY: Did you ever run for office?

NUTT: I didn't. Never have.

GREGORSKY: Which one is your favorite among the published books?

NUTT: Well, the one that brings in a huge amount of money [laughter] is Making Tough Decisions. Came out in 1989, and it's selling like crazy, even now. I do think it is the best book I've ever done. It was a textbook, published by Jossey-Bass. I think they sold it for about 50 bucks. You can get it on Amazon.com for 36 or 37. At least 100,000 copies have been sold.

GREGORSKY: How can we use my review of Why Decisions Fail to frame this discussion?

NUTT: Well, for starters, I want to pick a bone with you about language.

GREGORSKY: Go ahead.

NUTT: When you read Accounting, you have to learn a specialized language. When you read Marketing, same thing. But in Management, the language is sloppy. So I coined some words that mean something very specific within the context of the subject matter. My attitude was kind of, "If you don't like it, tough crap." [Laughter] And some people in my field didn't like it. Reviews of some of my research say "he uses this specialized language." Well, fine, they can use their specialized language. I think mine will endure better than those others.

GREGORSKY: But how is it "specialized"? Words such as consideration, concern, networking and tactics -- those are fairly mundane, common words.

NUTT: They are, but I use them in a very specific context. The meaning is clear from the context. And, in my business, everybody gets it. When someone reads it who is a practitioner [as opposed to an academic or consultant], they don't pay any attention to it, for the most part. But the point is, they're seeing a word being used over and over -- again, in a precise context, communicating what I want to communicate.

GREGORSKY: If they stick with the book, maybe they'll get used to your terminology, which can't properly be called "jargon." But the reader is expected to suspend their own definition [and override the] common understanding of these longstanding words.

NUTT: I spent many, many years evolving this -- and frankly, I changed it all the time [laughter]. But, by the time I finished this last book, I was convinced that the language being used was pretty darn acceptable.

GREGORSKY: If this process of redefinition is so critical, where's the glossary?

NUTT: Making Tough Decisions does have a glossary in the back. Why Decisions Fail was written a little bit more for the practitioner -- that was my intent. Or that was my attempt, to be more precise.

GREGORSKY: Glossaries are good -- whereas the 2002 book sticks in many re-dos of common words, seemingly on the fly.

NUTT: I didn't put the glossary in Why Decisions Fail, at the advice of my publisher. He said "let the words speak for themselves," and I think he was right.

GREGORSKY: Um-hmm. Do you also want to say something in response to my statement that your case studies are so lively and comprehensive they actually thwart the quest for a generic methodology?

NUTT: I have the generic methodology. It's actually turned inside out -- I wrote the methodology before [assembling] the case studies. The point was to use the case studies and the failures to say: "This is why the approach I suggest is the right way to do things." Kind of back into it, okay?

GREGORSKY: The starkness of the case studies might make a reader desperate for some ways to head off trouble. And the cover nicely tells what's coming: Why Decisions Fail has a cover citing company names, the '93 Waco raid by the feds, "The New York City Blackout" -- a cover with none of the visionary you-can-remake-reality rah-rah biz rhetoric.

NUTT: And the reason for that is -- you're a journalist, right?

GREGORSKY: Somewhat more of a political guy, but I function like a journalist, yeah.

NUTT: Okay, Why Decisions Fail [is packaged the way it is] because of journalism. Journalism has a four-to-one preference for the negative!

GREGORSKY: [Laughter] Aha! Yep, that's good.

NUTT: And I didn't appreciate that until appearing on National Public Radio's Marketplace. This really nice English lady is doing the interview. She's in L.A. and I'm in Columbus. We're going through some boring stuff, and she says, "Well, why is that the case?" I respond, "Because 50% of all decisions fail." That statement stunned her -- and she wanted to talk more. Well, I'm not too bright, but I picked up on that [as a selling point] for my work. Soon after, I published an article about failed decisions. With that and a couple more radio programs, I got perhaps a thousand e-mails. Nobody had paid a whole lot of attention to my stuff before, so I thought: "Okay, start with the negative."

GREGORSKY: I like the so-called negativism, because to me it's realism.

NUTT: Yeah, it tends to connect with the marketplace I was trying to write for.

From the Preface to Why Decisions Fail: "The book is directed toward a practitioner audience of mid-level to upper-level managers in for-profit and nonprofit organizations, those who aspire to these positions, and others who serve these groups. Those in executive education and master's management programs, such as MEA, MHA, MPA, may also find this book useful." In terms of topicality, author Nutt was in-sync with his previous five books. It was more the packaging that broke new ground, and he is dead-on about how to entice journalists.

Numbers are Necessary, and Risks Can be Tallied

GREGORSKY: Any other rebuttals to my review?

NUTT: The section of the book that's the most telling is one you don't even mention -- the chapter on analysis showing [situations] when the numbers-crunchers had the numbers yet didn't know what to do with them. They could not use them to make sense of their own reality.

GREGORSKY: Okay. [He's referring to "The Traps in Misusing Evaluation" -- the one chapter I never read, because parts of it resembled an Econ textbook.]

NUTT: You can see both extremes [among leadership teams] -- being either risk-averse or absolutely ignorant of risks. People either go one way or the other. They have no concept of a middle-of-the-road approach. Look at the case study of the Arena. [Chapter 5, "The Traps in Unmanaged Social and Political Forces" -- Columbus, Ohio, building a 20,000-seat arena to lure a major-league professional sports team.] They wanted to get tax support for it -- but it was a self-paying proposition. They didn't need the money! And they had the numbers that showed them that they didn't need the money.

GREGORSKY: [Appreciative laughter]

NUTT: The president of Nationwide Insurance was head of this whole drive. You would think he'd know how to crunch numbers. But he had the numbers and couldn't make sense of them. That's why that study is in the book, to say to executives: Yes, you can take numbers [and apply them to evaluate] generic ideas, make sense of them and do some very fine-grained analysis -- and conclude that this is a really bad idea.

GREGORSKY: So statistics don't have to be something that are just historic, they can be current and extrapolated with some degree of certitude.

NUTT: That's right, and a lot of judgment thrown in. Subjective numbers and subjective analysis are unavoidable. But you can still come up with some pretty concrete numbers. I didn't make these things up -- I went through these cases and found numbers that were at their disposal [during the planning]. They just didn't analyze those numbers correctly, or in a few cases they didn't want the numbers analyzed correctly.

GREGORSKY: That calls to mind the only executive-branch people who got fired for the Iraq War -- one economist, and one general. They were pushed out before the war started, because they tried to be realistic about the troops needed and the ultimate dollar outlay. Remember when [CEA director and former Fed Governor Lawrence] Lindsey said $200 billion?

NUTT: Which has turned out to be conservative. The rest of the Administration people had it closer to $40 billion!

GREGORSKY: What does this say about the whole Iraq adventure as a gross misestimation of input versus results?

NUTT: When you include the human losses, it's one of the worst we've seen in years. This kind of debacle goes on [financially] all the time. In the public sector, it's a kind of game. But the private sector jumps right in and helps them play it. When it's in their best interests, they can put their hand in someone's pocket, and take some tax money out. In an earlier book I wrote about the Sydney Opera House, which is the world-class example of cost-overruns. No other example on the planet can match that one. It's in a class by itself.

GREGORSKY: That beautiful shell-like building? Never heard the story behind it.

NUTT: It was designed by a Finn or a Dane. The architecture is stark, and stunning. Personally, I love it: Clean lines, very interesting design. So Jorn Utzon designs this [elitist structure for high-level music] for a Labor prime minister in a country that has absolutely no use for either. No use for elites, and none for opera. By the time they're done, they can't stage a major opera there. Why not? It's too small. There's no place to park. Trust me -- I went there, in the 1980s.

GREGORSKY: A Labor Party prime minister during the 1980s -- you mean Bob Hawke?

NUTT: No, construction happened long before that. The Prime Minister was John Cahill. He budgeted 10 million Australian [dollars] to build that thing; this took place in the late 1940s. The Sydney Opera Hall eventually cost 102 million [laughter] -- with no parking lot. No dressing rooms in the back for the singers -- the singers hate it. It doesn't serve the performing-arts community in the Sydney area, either. And so on.

But it's one of those examples of bad decisions that [time eventually solves] -- because it became a tourist attraction. You can't look at [pictures of] Australia without seeing the Sydney Opera House -- and everybody [from overseas] goes to visit it. It got the money back, many times over.

Different Takes on "Strategy" and Especially "Decision"

GREGORSKY: I never dwelled on the word "decision" until I read your book, so we need to talk about that word. The other word -- "strategy" -- is one I've focused on for three decades. I used to be chief-of-staff for Newt Gingrich -- this was 25 years ago -- and whatever you think of him philosophically he's a master strategist. As a junior congressman he got us to read Sun Tzu, Mark Hanna, and presidential campaign histories. The idea was to train his twentysomethings on how to think strategically. But for Newt himself "strategy" was not, strictly speaking, a matter of "thinking." The gifts he had there came from being an extreme intuitor -- a trait so overwhelming the strategies would come to him from out of the blue, causing some crippling jack-knifes within a still-small staff group. [See Gregorsky's classic profile of Gingrich -- as a type -- parts one and two.]

NUTT: Uh-huh.

GREGORSKY: But his congressional peers tolerated the zigs and zags because of the results: After November 1994, they had the first Republican-controlled Congress in four decades. So here's the question: Can you give me a succinct definition of "strategy"?

NUTT: Okay. For now, let's stay out of the political field. In management, "strategy" has a very precise meaning. It starts with the kind of business you're in. If you're a media conglomerate, are you going to be international, or local? Will you be multimedia [TV, radio, and more] or just stick to [one type of transmission]. "Strategy" covers what kind of businesses you choose to be in. What is your core business -- and that's your strategy. The real issue in strategy is competitive advantage and then the question is sustainable competitive advantage.

GREGORSKY: Why isn't that first set of factors "design"? Top management says "we're gonna sell this as opposed to that," and then they organize accordingly.

NUTT: Well, that's how you get a strategy. You know, the difficulty in business is a lot of things are both verbs and nouns -- and "strategy" is a good example of that. Again, sloppy language -- what I was trying to stamp out [with my 2002] book. But that book isn't about strategy. Okay?

GREGORSKY: Understood. That word "decisions" is the one you've made the big claim to -- and "decisions" is my biggest roadblock in terms of your glossary. But, before you [explain your view of decision-making as a multi-stage deal], give me the 10- or 20-word definition of "strategy."

NUTT: "Strategy" is designing your core business. You just brought up the word "design." I used to use that one too -- but plan it, develop it, devise it, innovate it. You know, whatever --

GREGORSKY: So you mean "strategy" to be very high level and pretty long-lasting?

NUTT: Top Management-team stuff, yes.

GREGORSKY: If that's the case, it's damn hard to make "strategic" changes in the business. You'll need to drop a whole product line, or perhaps merge with someone. It's not a question of "we're going to push sales in Ohio versus Wisconsin" or "shoot for 10% market-share as opposed to five"?

NUTT: That's part of it. I claim that "strategy" has eight pieces. What products or services will you sell? What are your key sources of revenue? What markets will you serve? How will you organize, and is there something distinctive about that? What kind of outlets will you use? And image is another one -- your persona. In the public sector I used to use that a lot.

The index in Why Decisions Fail does not have "strategy" as an entry and, unless you are a military historian or political-campaign pro, you're probably weary of it by now. So let's proceed to the "stages" of decision-making. My 2004 review of that book did not pay proper heed to pages 41-42, where Nutt offers "five decision-making stages." They are: "[C]ollect information to understand the claims calling for action, establish a direction that indicates the desired results, mount a systematic search for ideas, evaluate these ideas with the direction in mind, and manage social and political barriers that can block the preferred course of action during implementation." The three emphases are not the author's but mine, to stress words important to his analytical framework. In fact, read this paragraph a second time, because -- just as Peter Drucker personified "management," Daryl Conner pushed "change," Mike Hammer ran with "re-engineering" and Al Ries seized on "Focus" -- the umbrella Nutt words are decisions and decision-making.

GREGORSKY: To me the "decision" is making up your mind and sending out the memo. Something that occupies less than a minute or, for a company, perhaps a grueling set of meetings that last a day or two. But you stretch "decision" to five stages, beginning with "awareness" and seemingly going right out to end of the implementation process.

NUTT: And you claim [in the review] that "decision" doesn't include implementation, which is nonsense. Of course it includes implementation. If it doesn't, there's no point in making a decision. Sending out a memo is an attempt at implementation -- a very poor choice, I would add.

GREGORSKY: In the public sector, decisions are made just to be on record as favoring this or that. If [the nominal deciders don't have] a plan to push the bureaucracy, there is no implementation -- but there was a decision! Policies get laid down all the time that do not produce results.

NUTT: Sure. And not all the decisions I used [in the case studies] were "realized," which is why I call them failed decisions. Also, in my studies, I do not consider decisions if they are made [merely] to set the stage or to take symbolic action. I'm only interested in decisions intended to create tangible results -- a building, etc.†

GREGORSKY: Okay, all right. Now I see the coherence in your set of terms.

NUTT: Implementation is a part of [decision-making] because you can't get to the realization point until you set it in place, or see that it's functioning in some fashion. Now some people would agree with you -- a fair number of people, actually. But -- I think they're wrong. They more or less claim a decision is something you do and then walk away from.

GREGORSKY: Well, you set a policy, but then It has to be carried it out. And the system that produces a decision is often quite different from the one needed to implement the policy you have decided is right.

NUTT: You have to implement it. No decision produces one ounce of benefit unless it's "realized." Or implemented, or put to use.

From Why Decisions Fail, page 44: "Implementation puts the decision to use. This can be done in several ways. The acceptance of stakeholders can be promoted by involving them, or their representatives, in the decision-making process and by canvassing them early in the process... Another approach, called networking, guides stakeholders one at a time through steps that alter their objectives, social ties, and self-esteem and reinforces the positive aspects of an evolving decision. Edict and persuasion can also be used, but they are much less successful." Hey, do you think that book needed a glossary? We're not done with Paul Nutt's method. In fact, a sidebar piece to my late 2004 review -- www.ExactingEditor.com/PracticesWDF.html -- quoted all seven parts of his summary advisory. The next section of the Q&A, though, is for time-travel.

Twenty-Five Years and Not Many Worthy Survivors

GREGORSKY: Since 1982, we have been through the Excellence movement, TQM, "Built to Last," process re-engineering, "courageous followership," the notion of the Internet being one uncontrollable global neural network, "digital convergence" (whose products flop far more often than they succeed), an e-commerce bubble that destroyed $100 billion in venture capital, and, since 9/11, a struggle between individual privacy rights and collective security demands. Looking at this list, I salute the Jim Collins books, and also the "courageous follower" agenda of author Ira Chaleff (whoís a friend of mine). The broader point is that it has been a golden era for business theories, movements, technologies, seminars and delusions. Though rooted more in the world of Academe, you were part of this whole swirl. So hereís the question: In the past 25 years, what have you seen that is both radical and productive in the management field, regardless of whether it became popular?

NUTT: Much of what you just mentioned is "old wine in new bottles." Especially re-engineering. Mike Hammer's [points] are taken -- lock, stock and barrel -- right out of Systems Engineering books that were sitting on the shelves forever. In fact, in 1992, I published a book, and all I had to do was put "re-engineering" on the front of it -- because that's what it was about -- and I might have been able to [catch that wave]. But I wasn't smart enough [laughter]. Packaging is one of my big failures in this business. I've done it "my way," which isn't necessarily the best way from a marketing standpoint. Some of the stuff -- it has taken a while for it to catch on. But that's completely my fault. I'm very stubborn about how my stuff is packaged, and how it's described.

GREGORSKY: Are you an INTJ?

NUTT: No, I'm an ENTJ. In fact, I have no S or F [sensor or feeler] in my soul.

GREGORSKY: That I would've bet money on, even before we talked. [As the reader probably knows, "MBTI" stands for Myers-Briggs Type Indicator, the roots of which can be found in Carl Jung's magnificent 1921 book Psychological Types.]

NUTT: [Laughter] And, in the back of Making Tough Decisions, you'll find an MBTI form that I came up with. It's still being used, and the people in Gainesville are not happy about that. They would like me to pay a royalty on it [laughter], which I refuse to do. [The "Gainesville" reference is to the folks behind www.capt.org.]

GREGORSKY: Say more about the past 25 years.

NUTT: Well, take the Peters and Waterman book [In Search of Excellence]. They were right for the wrong set of reasons. Everything in that book -- particularly the notion of tensions (which I had written five or six articles on) -- is right. And I wonder how they got it right. Must be due to Bob Waterman. Because Peters is a complete idiot.

GREGORSKY: I agree. About a decade later, Waterman produced his own book [The Renewal Factor] -- so much more "grounded" than Peters' stuff.

NUTT: But Peters is one of the greatest stump speakers that ever hit American business. On a stage, he's spellbinding. He's incredible. I'm jealous at how good he is [laughter]. But his observations and contentions -- they're all skin-deep. Let me give you an example. He says the biggest reason for the success of Limited Stores was their great distribution system. Nonsense. The reason for their success was that [chairman and CEO] Les Wexner could go to Italy, find these sweaters sitting on a rack for $700, and have that sweater in their stores for $95 within six weeks. It's design.

GREGORSKY: You don't mean fashion design, but design of the operation?

NUTT: He was absolutely fabulous about being able to spot something, figure out a way to manufacture it at a much lower price, and replicate the high-fashion part of women's apparel. Now, when he got away from that [strength] and his business got too big, his personal impact on the stores started to diminish; that's when he started to run intro trouble. So Peters has it totally wrong. Distribution has almost no bearing on why Limited did so well.

GREGORSKY: Good example. Now tell me someone who deserves their business plaudits.

NUTT: Jim Collins, particularly in his work with Jerry Porras, is really, really good. It's well-written, it's well done.

GREGORSKY: In one of the two major books, he credits his grad students by name, which is unusual. And he said: We're starting off [this search for why companies endure] with no preconceived notions or grand theory -- it was more like your classic and impartial academic inquiry.

NUTT: That was rare [and it led to] an absolutely wonderful piece of work. Although now he's becoming a little Covey -- you know, his own company, and his own retreat [laughter].

GREGORSKY: Yep, danger signs. It's hard to be original after a dozen years of fame. You have too much money and adulation, and no need to think hard.

NUTT: Here's one you left out: Six Sigma. Some of my closest friends at OSU are now selling it. Graduate students come in and say, "I want to study Six Sigma." I tell them: "First, you have to tell me how you tell if someone is doing it and not doing it. And then, if it's not being done, how they put it in place -- and once you can describe that for me, we have something we can study." They go away and never come back -- because there's no answer to that question.

GREGORSKY: By saying "whether it's there or not there," do you mean whether the discipline is in the product or service? Whether it can be delivered?

NUTT: No. It's how you tell whether a manager engages in the activity. This is not easy to do. For example, how do you tell if a manager does an appraisal as opposed to just jotting down something to fill out a form?

GREGORSKY: You're saying there's not a kernel of truth to Six Sigma?

NUTT: Of course there is. Six Sigma was originally a Motorola concept, I believe, taken from Deming -- it dates back to the zero-defects movement. The idea is that "six sigma" means six standard deviation units away from the mean. Which means: If you have 99.999% good product going through, we want to eliminate [the remaining] errors, okay? Well, that's a good idea. But zero defects is impossible -- or, if possible, it's infinitely costly. So Six Sigma is nothing but a metaphor for what you're trying to accomplish.

GREGORSKY: It has a mystical, romantic name.

NUTT: And that's part of the difficulty with the scope of things you rattled off. Unfortunately, an awful lot of people [pushing those ideas and products] are just plain charlatans. They're glib, they're smart. They're incredibly quick on their feet, and they work for [the big consulting outfits]. They come into a business and knock the CEO right off his feet. In many cases they are telling him what they learned at the last consulting job. A lot of this stuff, such as Hammer's re-engineering -- it just came along at the right time. The guy was brilliant because he called it something that made all kinds of sense to all kinds of people who needed help in that area. And so -- kudos to him.

GREGORSKY: "Re-engineering" also lends an aura of absolute specificity and control to something which, because humans are vital to it, can't get there.

NUTT: Yep, that's right. People are the "wild hair" In all of this. They can do rather crazy things. But look at most of the management literature -- it assumes the person away. It's the SOR [stimulus-organism-response] model, which comes from psychology. Apply an "adverse stimulus" to somebody -- the "O" -- and they'll run away from it; give 'em a carrot, and they'll come over to it. Reminds me of the old B.F. Skinner experiment with the pelican. What it says is that the person (the O) is incapable of learning; does not internalize norms; doesn't look at the environment they're a part of -- if they did, they might say "Gee, this is pretty oppressive" -- and doesn't develop an attitude about that which changes their behavior and changes their productivity; and on and on and on.

In Search of an Excellent Grasp of Human Nature

GREGORSKY: Where do individuals and groups, with all their hidden needs and motivations, enter into your own framework?

NUTT: Talking about decision-making, the first thing is to figure out what the arena of action is. Then ask: What are the interests of people [who stand to be] affected by your decision? Because some of those people can block you straight away.

GREGORSKY: I think most elected officeholders figure that out quickly. They might guess wrong or miss their real enemy [on a particular issue or bill] -- but at least the radar is on.

NUTT: But many people tell me, "You can't implement before you start the decision-making process." That's nonsense! The first thing [the senior manager should say] is, "This is what I think the decision is all about: It's disposing of an obsolete oil platform." Okay, that's what he thinks it's about, what he thinks the issue is. Someone needs to ask: "Why is a disposal the issue?" Well, maybe it's because of the precedent (we might have to get rid of another oil platform later). Maybe there's government intervention. Maybe there's a public-policy issue here. Maybe there's a public-awareness question. Then ask: Who are the stakeholders -- and what are their interests?

See Chapter 4 in Why Decisions Fail, about the Brent Spar oil platform and how to dispose of it. This turned into an environmental PR nightmare for Shell Oil, to the point where the European Parliament and the government of Norway added their own obstacles -- see http://news.bbc.co.uk/1/hi/world/europe/221508.stm

GREGORSKY: So [to avoid anything like the Brent Spar debacle] you are starting with the feedback, or at least anticipating it before you get to the decision.

NUTT: Well, at this stage, you still don't know what the decision is. I could [opt] not to deal with the oil platform at all, but instead decide to start working on PR for the company. That's a different decision -- the decision is now about PR, not disposing of the oil platform.

GREGORSKY: Yes, the nature and content of the decision. Here's your bottom-line recommendation, from page 129: "Avoid using an idea as a direction. People are drawn to the idea -- either to support it or to resist it. Debates about what is needed get lost in debates over the merit of the idea... Hold back ideas until a thoughtful direction is set that indicates the desired result."

NUTT: Thatís where [senior managers] get screwed up. They latch on to an idea.

GREGORSKY: Talk more about that. It's fascinating -- the tendency to skip past the phase of "what is this decision about" or, as you call it, "defining of the arena" or seeking "a direction" rather than leaping onto a solution.

NUTT: I'm still struggling with terms. Some of the later work calls it "discovery" on the one hand, and "idea-imposition" on the other.

GREGORSKY: Those would be the naturally opposing forces, right? You have to short-circuit the imposition of an idea so the discovery phase can play itself out?

NUTT: Iím thinking in process terms here. Discovery is about learning -- learning about the best arena of action, the interest of people affected, and the hoped-for results. Search and evaluation then follow. In idea-imposition, the process follows what decision-makers often do in the debacles: Find a ready-made plan and its quick fix, do a defensive evaluation of it, and implement it using power (or just write a memo). Out of the 400 plus cases I have looked at, around 50% will fall into one of those two categories. About half the time, people really make an attempt to [be thoughtful and sequential]: "Okay, I learned about participation in my business program, so let's try a little bit of it here." So they focus on the arena. They are trying to move a decision in a way that becomes useful for all concerned.

GREGORSKY: And the other half of the cases?

NUTT: The other half of the people start with: "I have an IDEA" [laughter]. The idea might be utterly self-serving. Someone outside the organization makes a claim -- and the claimant is too important or influential to ignore, so you have to act on it. Letís say [a major customer is] alarmed about product quality. So? The idea is "let's do Deming." What's the next step? Sell the idea: "I have to show people that [Deming] is a good idea." That leads to defensive evaluation: "Let's find why this idea's good." After the evaluation is made, comes "edict" (do this) or "persuasion" (we should do this because).

GREGORSKY: Isn't "edict" much harder in the public sector, because there are so many constituency groups?

NUTT: Everybody says that, but it's not true. Public-sector organizations are constantly [issuing what I call edicts]. Sometimes they get pulled up short, particularly if they step on a client group that has power or influence.

From Why Decisions Fail, page 29: "Using an edict to implement...is high risk and prone to failure. People who have no interest in the decision resist it because they do not like being forced and because they worry about the precedent that yielding to force sets. When using an edict, the best one can hope for is indifference -- people do not care enough to resist you. If the edict fails, decision-makers resort to persuasion" -- and, in Nutt's lexicon of recast words, persuasion is wholly reactive and top-down, a phase that would never have been necessary had leaders made use of participation.

So How Does this Consultant "Hire His Clients"?

GREGORSKY: Let's say you get called in by a state agency or a company. Theyíve set up a two-hour meeting and "we're considering hiring you for the next six months to advise us on Project XYZ." You come in as a potential consultant for this larger group, entity or institution. What is the basic checklist you go through in your own mind to evaluate whether to work for them?

NUTT: Oh boy -- that's where my ENTJism [with its quest for method] kind of goes out the window. I have a real visceral reaction to people. Probably within the first 10 minutes, I decide yes or no.

GREGORSKY: But also, being an NT, you probably look back a day or week later and think: "Hereís the implicit logic in back of that intuitive decision that seemed to be made viscerally."

NUTT: [Strong laughter] Yeah [pause]. Okay, you're asking about the thought-process. The first issue is: Does this man know anything? If they're a fool, you won't learn anything [on that six-month consulting assignment]. What I'd rather do is find the exemplar leader -- and hang out with him.

GREGORSKY: So the appeal there is being able to work with a quality guy or gal who's going to -- perhaps -- change your model based on his or her own experience.

NUTT: Exactly. After you've presented your science, they'll sit back and say: "Well, you know, that isn't quite right, because" -- and you will learn something [distinctive and critical about that part of government or business]. Reactions of this sort improve immensely the quality of your ideas. Contrast that with the more standard situation where they want you to reaffirm what they've already decided to do. Early on, when I was desperate for money, I got caught in lots of those kinds of things.

GREGORSKY: We've all had tough times -- accepting a mission when your role is not much better than being the cannon fodder.

NUTT: Paying the bills can be a key consideration [laughter]. But for the past 15 or so years, I've been real circumspect about doing consulting for anybody.

GREGORSKY: So how much the would-be client knows is the first issue. What is another strong criterion you use, either consciously or intuitively?

NUTT: Iíd say there are several considerations [that would bring me into a consulting engagement]: A topic that can be a useful exemplar or case in the classroom; a long-term association that can contribute to research as an illustration or, more importantly, as a site to pilot new ideas; an organization that will allow interviews and other kinds of research into their business practices. And this next consideration used to be key -- whether Bob was interested in it. He and I had a partnership that often benefited from working on a project together. Often the project became a case in a book, or a paper or a source of insight for the same. Unfortunately, Bob has retired!

Itís time to meet "Bob." Nutt's only book co-author is Robert W. Backoff, who also taught at Ohio State. Nutt thinks Backoff a delightful collaborator, whose only vice is that he has grown tired of writing. In 1992 they published The Strategic Management of Public and Third-Sector OrganizationsNutt and Backoff also developed a seminar-retreat model that let them spend a whole day with a leadership team, deliver training or coaching, and subtly get clear on whether a long-term engagement looked worthwhile...

NUTT: We spend eight hours with these people, and see how it seems to be working. If we're getting mostly static and not making much progress, at the end of the day we say, "It was nice knowing you..." If you do this in a context of continuing-education, it's [not rude] to walk away after the CED session is finished. But if we liked 'em, we would come back and help 'em out -- if requested to do so. Retreats of this kind [led to assignments] with Childrenís Services, the Historical Society, and Family Medicine. Some of those were written up in the Strategic Management book I did with Bob.

GREGORSKY: Are you 60 yet?

NUTT: Yes -- unfortunately.

GREGORSKY: Iíve known various people who, by the time they're 50, if they've had some success in business authorship, have their "shtick" down -- their method, their mantras -- to where they can give the PowerPoint in their sleep. That partís not necessarily bad. Any pro has to be convincing in conveying their core method. The real problem is that they can no longer think outside of that paradigm. More than once I have sought to work with someone whose books suggested a radically fresh thinker -- and a few years later Iím seeing them as a brain-dead ideologue "dogged by their own dogma." What I'm hearing you say, Dr. Nutt, is you're still searching for truth, or at least a few slices of new truth.

NUTT: [Hearty laughter] Probably! Actually, I don't even work for Ohio State anymore. I'm just working for myself -- and probably one of the few people still publishing [when itís not necessary in an academic-career sense].

GREGORSKY: But what is the driver? What are you still looking for after all these years?

NUTT: A logic problem. In every field you look at, there's sort of a hole. At least, I carve this piece out and say: "Ahhh, that's interesting." And then you play around with that piece -- and try to make it right!

GREGORSKY: You say a "hole" in a field; are you talking about a profession?

NUTT: No, just a piece. In my case, I was always interested in decision-making -- which is a "piece" of management.

GREGORSKY: Is the work of Herbert Simon a major asset on that score?

NUTT: Well, he came up with some of the first paradigms on decision-making. His 1977 book Intelligence, Design, Choice is brilliant. It doesn't cover implementation, unfortunately -- but thatís the only problem with it. He hit the nail right on the head with "design." Because that's what is absolutely missing from management.

GREGORSKY: And he called it "design"?

NUTT: Yes. Actually he wrote a book called The Science of the Artificial, which is all about design. Came out in 1969. [For a list of Herbert Simonís books, click here.]

GREGORSKY: I know he's no longer with us, but -- is he one of your gurus?

NUTT: Yeah, in a way. But he didn't know I existed at the time. I read his book with Jim March -- Organizations and Action. It's a classic in management. Marsh is the most incredible wordsmith ever.

GREGORSKY: That's a totally new name for me.

NUTT: James March -- arguably one of the most influential people in management during the past 40 years. He's a professor emeritus at Stanford and I believe he's quite ill now. He used to come fairly regularly to Academy of Management conferences. Acerbic son of a gun, but [laughter] very, very smart. He can do a brilliant study almost by snapping his fingers. And an incredible wordsmith -- he wrote some of the original stuff on decision-making, in Norway, with a guy named Olson.

We discuss my interpretation of Peter Drucker, MBTI's perpetual utility and ease of use, and Nutt's daughter's contention that Why Decisions Fail needs to be restructured -- Nutt fears this means "dumbed down" -- to become a natural tool for the practicing manager. In other words, move past the journalists who like disaster stories -- because most of them arenít responsible for large organizations to begin with -- and turn the Nutt practices into a business manual. Nutt admits heíd like to break out, do a Jim Collins, "get to the next level" -- though he doubts rewriting the 2002 book is the way to achieve that. But it might be a fun project, if his daughter can show him the blueprint.

Take the Long Way Home?

GREGORSKY: Is there a specific philosophical or pragmatic -- or maybe even a technical or "systems" -- series of questions you are consciously investigating these days?

NUTT: I'm still trying to look at decision-making as a process. That means pulling together all the bits and pieces in my previously published work (also used to write Why Decisions Fail) and asking: "All right, if someone follows these recommended activities, what can I say about it? Conversely, if they follow the string of activities that led to debacle, what can I say about that? Qualitatively and quantitatively, what can be said?" I've just sent in a paper on that issue. I'm also looking at downsizing in public organizations -- I've got a 16-year study in that. And I was going to try to look at Transformation. But, because I'm out of graduate students [laughter], that string of work has languished a little bit.

GREGORSKY: How is "transformation" understood here in 2007? For about a decade, I have recoiled from that word, because it reeks of New Age mysticism -- an individual can [supposedly] "transform" themselves or their environment in a very short period. Big change takes time, and a heap of grunt-work, even at the micro personal level. But -- since you recast so many conventional terms [grinning] -- do you have a different meaning for what I take to mean "big change within an organization"?

NUTT: Well, I have a special interpretation. (Imagine that!) Again, Iím not too pleased with how this term has been bandied about in the management literature, so I sought a more precise interpretation. [When we did the editing, he inserted this extract from an article published in 1996...]

Transformation requires a vision: A vision provides energy, has inspirational qualities, and brings organizational distinction. Transformations can result when leaders act on visionary possibilities, drawing on their knowledge of their organization -- its sources of revenues, services, customers, and human resources -- to mobilize action with an idea. The vision suggests ways to make radical changes in an organizationís strategy. To find a radical change, leaders abandon an orientation rooted in the present and adopt one focused on the future.

Leaders reposition strategically by forming ideals and asking hard questions about how to improve their current strategy. This involves changes in current services; customers served today, current service provision channels and skills, the basis for todayís collaborative advantage, current sources of funding, and image. To carry out a transformation, leaders seek answers to these same questions in a future context. The leader forms a vision that suggests what future services, customers, channels, skills, bases for collaborative advantage, sources of funding, and persona might be...

A transformation takes place when creative and coherent changes in the services, clients, etc. in current strategy are integrated with core capabilities. For instance, the Ohio Department of Natural Resources (ODNR) was transformed with a vision that incorporated critics into its programs to build joint interests. Conflicts between sportsmen and environmentalists were managed by opening up new hunting and fishing areas and using fees for hunting and fishing licenses and park use to support wildlife, environmentally threatened areas, and state parks. Cooperation between historically antagonistic groups, representing sportsmen and environmentalists, was created and resulted in broad support for tax-based funding to protect endangered areas and wildlife and to support recreation programs. Recreational areas were expanded. The increased revenue from user fees provided the funds to support other initiatives. The synergy of protection and use programs led to an ODNR budget that relied on the state funding for less than one-third of its programs, making it take on the characteristics of a private-nonprofit organization.

The transformation allowed ODNR to move to a higher order of organized complexity in which change, such as new services, was not just added on but emerged from the integration of old and new services. As a result, a transformed organization is able to respond in new and different ways to emergent demands and opportunities that arise from turbulent environments. Public organizations with a vision that anticipates client needs can use these needs to make changes in their core services and procedures, and produce a similar result. Synergy between the organizationís new and old services and other aspects of its strategy increase flexibility and adaptability.

-- Paul C. Nutt and Robert W. Backoff...and for the rest of the source, write Nutt.1@osu.edu

GREGORSKY: Very good. Thanks for doing this somewhat impromptu Q&A. I respect the fact that you read my review in the first place -- always nice to meet up with an author that way.

NUTT: And you know how I stumbled on it? [Laughter] I was bored, and getting ready to go to the gym to work out. Then I realized there's no parking places over there. So I went back to the computer and began messing around. "You know, I never looked myself up [on Google]." I found around 1,000 links, and thought "My God, that's interesting." I soon realized that about 90% of 'em were the Houston Nutt -- the coach of Houston, or maybe itís Arkansas. They have football and Nutt and The Ohio State University all mixed up.

GREGORSKY: Okay.

NUTT: But I flipped through there and found a couple of negative things about [Why Decisions Fail]. One of them was posted on Amazon.com -- written by a guy from Notre Dame. Well, that university doesnít turn out good people; we know that [laughter].

GREGORSKY: Yeah yeah, sure sure [smiling].

NUTT: And the next one was yours. I started to read it, and that's how I came across you. I was waiting to go to the gym.

GREGORSKY: Well, as an INTJ, I also love this kind of back and forth. Weíll have a good transcript. And someday, when Iím in Ohio, Iíd like to go out for lunch and talk some more about this stuff.

NUTT: I would love to. Iíd be happy to talk with you any time. Just bear in mind that Iím very difficult to reach sometimes, so be patient with me.

GREGORSKY: All my ENTJ friends and associates tend to be off tilting at windmills or saving the world, so Iíve learned to be very flexible in terms of their schedules.

NUTT: I used to have the Man of La Mancha poster in my office, actually.

[Mutual laughter]