Shane Parrish, author of the highly recommended Farnam Street blog, had a great post  about defensive decision making – the type of decision making that focuses on what “looks right” vs. what “is right.”

Defensive decision making is the “IBM” option. Since “no one got fired for buying an IBM,” it is intended to protect the decision maker. Organizations can often create a massive decision-consequence asymmetry in that they become so risk-averse that most decisions come with small upside if they go well and large downside if something goes wrong (e.g. get fired).

The natural reaction is to just make the “default” decision. Nobody has to worry about their reputation and negative outcomes can be easily defended. That’s why so many companies ask their stakeholders to think outside of the box but rarely implement any of those ideas.

And, that’s why culture is more important than hiring the right people. In general, smart people prefer to choose solutions that are right. But it requires the nudge of a culture that incentivizes attempting decisions that are right instead of rewarding those that look right.