“Since experience in organizations often suffers from weak signals,
substantial noise, and small samples, it is quite likely that realized history
will deviate considerably from underlying reality.”
— James March
In his book, The Ambiguities of Experience, James March explores the role of experience in creating intelligence.
Folk wisdom both trumpets the significance of experience and warns of its inadequacies.
On one hand, experience is thought to be the best teacher. On the other hand, experience is described as the teacher of fools, of those unable or unwilling to learn from accumulated knowledge.
The disagreement between those folk aphorisms reflects profound questions about the human pursuit of intelligence through learning from experience.
March convincingly argues that although individuals and organizations are eager to derive intelligence from experience, the inferences stemming from that eagerness are often misguided.
The problems lie partly in errors in how people think, but even more so in properties of experience that confound learning from it. ‘Experience,' March concludes, ‘may possibly be the best teacher, but it is not a particularly good teacher.'
Here are some of my notes from the book:
- Intelligence normally entails two interrelated but somewhat different components. The first involves effective adaptation to an environment. The second: the elegance of interpretations of the experiences of life.
- Since experience in organizations often suffers from weak signals, substantial noise, and small samples, it is quite likely that realized history will deviate considerably from the underlying reality.
- Agencies write standards because experience is a poor teacher.
- Constant exposure to danger without its realization leaves human beings less concerned about what once terrified them, and therefore experience can have the paradoxical effect of having people learn to feel more immune than they should to the unlikely dangers that surround them.
- Generating an explanation of history involves transforming the ambiguities and complexities of experience into a form that is elaborate enough to elicit interest, simple enough to be understood, and credible enough to be accepted. The art of storytelling involves a delicate balancing of those three criteria
- Humans have limited capabilities to store and recall history. They are sensitive to reconstructed memories that serve current beliefs and desires. They conserve belief by being less critical of evidence that seems to confirm prior beliefs than of evidence that seems to disconfirm them. They destroy both observations and beliefs in order to make them consistent. They prefer simple causalities, ideas that place causes and effects close to one another and that match big effects with big causes.
- The key effort is to link experience with a pre-existent accepted storyline so as to achieve a subjective sense of the understanding.
- Experience is rooted in a complicated causal system that can be described adequately only by a description that is too complex for the human mind. The more accurately reality is reflected, the less comprehensible the story, and the more comprehensible the story, the less realistic it is.
- Storytellers have their individual sources and biases, but they have to gain acceptance of their stories by catering to their audiences.
- Despite the complications in extracting reality from experience, or perhaps because of them, there is a tendency for the themes of stories of management to converge over time.
- Organizational stories and models are built particularly around four main mythic themes: rationality (the idea that the human spirit finds definitive expression through taking and justifying action in terms of its future consequences for prior values); hierarchy (the ideas that problems and actions can be decomposed into nested sets of subproblems and sub-actions such that interactions among them can be organized within a hierarchy); individual leader significance (the idea that any story of history must be related to a human project in order to be meaningful and that organizational human history is produced by the intentions of specific human leaders); and historical efficiency (the idea that history follows a path leading to a unique equilibrium defined by antecedent conditions and produced by competition.
- Underlying many of these myths is a grand myth of human significance: the idea that humans can, through their individual and collective intelligence actions, influence the course of history to their advantage.
- The myth of human significance produces the cruelties and generosities stemming from the human inclination to assign credit and blame for events to human intention.
- There is an overwhelming tendency in American life to lionize or pillory the people who stand at the helms of our large institutions -to offer praise or level blame for outcomes over which they may have little control.
- An experienced scholar is less inclined to claim originality than is a beginner.
- …processes of adaptation can eliminate sources of error but are inefficient in doing so.
- Knowledge is lost through turnover, forgetting, and misfiling, which assure that at any point there is considerable ignorance. Something that was once known is no longer known. In addition, knowledge is lost through its incomplete accessibility.
- A history of success leads managers to a systematic overestimation of the prospects for success in novel endeavors. If managers attribute their success to talent when they are, in fact, a joint consequence of talent and good fortune, successful managers will come to believe that they have capabilities for beating the odds in the future as they apparently have had in the past.
- In a competitive world of promises, winning projects are systematically projects in which hopes exceed reality
- The history of organizations cycling between centralization and decentralization is a tribute, in part, to the engineering difficulty of finding an enduring balance between the short-run and local costs and the long-run and more global benefits of boundaries.
- The vividness of direct experience leads learners to exaggerate the information content of personal experience relative to other information.
- The ambiguities of experience take many forms but can be summarized in terms of five attributes: 1) the causal structure of experience is complex; 2) experience is noisy; 3) history includes numerous examples of endogeneity, causes in which the properties of the world are affected by actions adapting to it; 4) history as it is known is constructed by participants and observers; 5) history is miserly in providing experience. It offers only small samples and thus large sampling error in the inferences formed.
- Experience often appears to increase significantly the confidence of successful managers in their capabilities without greatly expanding their understanding.