In some systems we can experiment in a really formal way and we can set up controls and this is how credit card companies design their mailing lists. And often we’re not going to be able to do that. It’s going to be a much more ad hoc informal process.
If you’re fighting a war it’s going to be informal. If you’re launching new product lines it’s probably going to be informal. And what I would say is that the one thing that seems to work again and again is to try to push the decision-making down the organization as far as you can so that the people who are making the decisions can see the affects of the experiments they’re trying out.
So for instance, in the Iraq war it was colonels and majors, effectively middle managers who were able to adapt and able to change their strategy and I was told by one British general: “Well of course we readily adapt an experiment lower down the ranks because that saves lives. At the top we don’t experiment so much and we don’t learn lessons so easily.”
So my general informal principle is we need to push decision making authority as far down the organization as you can then people can try new things. They’re talking to customers and they will adapt and they will experiment and they will figure out if they’re given the right incentives. They will figure out what is working and what isn’t.
In Their Own Words is recorded in Big Think’s studio.
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