WELLS FARGO: A SURPRISING LESSON ABOUT UNINTENDED CONSEQUENCES

Don’t you wish we lived in a linear world?

A world where there is a problem and we solve it. Simple, to the point, no further thoughts. Check. Move onto the next issue please. A simple two-step dance move, right?

The complexity of the world does not offer us this luxury. Much like the illustration above, once the first domino is pushed, it can take a looooooooong time for the last one to fall. In the current case of Wells Fargo, it took five years to understand the effects of a “simple” decision.

In the world of systems thinking this concept is known as “cause and effect is far removed in space and time”. Often the person that pushed the first domino is long gone, even promoted, by the time the last domino falls. Rarely do we actually face the long term impact of our leadership decisions.  Sound familiar?

So what is the lesson we can all take away from this crisis?  

Don't expect life to be as simple as we have a problem and we solve it - end of story. When solving issues, there are two additional CRITICAL insights to consider:

1. WHAT ARE THE UNINTENDED CONSEQUENCES OF THIS DECISION?

There is ALWAYS an unintended consequence.  No decision is immune. This question makes us pause long enough to glance farther down the road. It forces us to consider what life might be like once the cascade of dominos is in full force. List out several possible consequences of the “solution”. Once you do, then ask the next question.

2. WHAT STRUCTURES DO WE NEED TO PUT IN PLACE TO MITIGATE THOSE CONSEQUENCES?

Structures drive behavior. Structures are anything tangible or intangible which drives behavior of an individual or a group. Structures can be physical, information, knowledge, power, communication flow, etc. In the Wells Fargo case, the reward structure was one which drove the behavior of employees. (Yes, there were additional structures at play but I can't make this article toooo long or you won't read it!)

If leadership had asked the two questions above, would the outcome have been different? Maybe. Perhaps they would have considered the unintended consequence of people working the system. Structures could have been implemented to mitigate that potential. Perhaps this crisis would not be unfolding before us in such magnitude.

I am not a believer in heroes or villians when it comes to solving complex issues. Systems thinking teaches us it is not that simple.  There is, however, a valuable lesson here for all of us as leaders. Outcomes like this don't have to be a surprise with a bit more foresight.

I am on a QUEST to inspire leaders to learn more about these powerful insights from the discipline of systems thinking.   This knowledge can make a HUGE difference in our organizations, and ultimately, in our professional and personal lives.

Our complex world is one of circles, not linear straight lines. The more we embrace this understanding, the more HOPE there is for all of us. 

Don’t you wish we lived in a linear world?

A world where there is a problem and we solve it. Simple, to the point, no further thoughts. Check. Move onto the next issue please. A simple two-step dance move, right?

The complexity of the world does not offer us this luxury. Much like the illustration above, once the first domino is pushed, it can take a looooooooong time for the last one to fall. In the current case of Wells Fargo, it took five years to understand the effects of a “simple” decision.

In the world of systems thinking this concept is known as “cause and effect is far removed in space and time”. Often the person that pushed the first domino is long gone, even promoted, by the time the last domino falls. Rarely do we actually face the long term impact of our leadership decisions.  Sound familiar?

So what is the lesson we can all take away from this crisis?  

Don't expect life to be as simple as we have a problem and we solve it - end of story. When solving issues, there are two additional CRITICAL insights to consider:

1. WHAT ARE THE UNINTENDED CONSEQUENCES OF THIS DECISION?

There is ALWAYS an unintended consequence.  No decision is immune. This question makes us pause long enough to glance farther down the road. It forces us to consider what life might be like once the cascade of dominos is in full force. List out several possible consequences of the “solution”. Once you do, then ask the next question.

2. WHAT STRUCTURES DO WE NEED TO PUT IN PLACE TO MITIGATE THOSE CONSEQUENCES?

Structures drive behavior. Structures are anything tangible or intangible which drives behavior of an individual or a group. Structures can be physical, information, knowledge, power, communication flow, etc. In the Wells Fargo case, the reward structure was one which drove the behavior of employees. (Yes, there were additional structures at play but I can't make this article toooo long or you won't read it!)

If leadership had asked the two questions above, would the outcome have been different? Maybe. Perhaps they would have considered the unintended consequence of people working the system. Structures could have been implemented to mitigate that potential. Perhaps this crisis would not be unfolding before us in such magnitude.

I am not a believer in heroes or villians when it comes to solving complex issues. Systems thinking teaches us it is not that simple.  There is, however, a valuable lesson here for all of us as leaders. Outcomes like this don't have to be a surprise with a bit more foresight.

I am on a QUEST to inspire leaders to learn more about these powerful insights from the discipline of systems thinking.   This knowledge can make a HUGE difference in our organizations, and ultimately, in our professional and personal lives.

Our complex world is one of circles, not linear straight lines. The more we embrace this understanding, the more HOPE there is for all of us.