Question perspectives suggest different approaches to understanding the business

Question 2

 

Part 1

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The way things are. This is a simplified way of explaining default thinking as a business approach. It uses a linear and rational
logic to help explain the world and ultimately guides companies toward growth
and profit maximisation. The method reveals what is happening in the foreground
of a business, assimilating a form of single-loop learning. Intellectual
capacities are not used to question the underlying assumptions of an issue,
just the repercussions of it (Alvesson &
Spicer, 2012). An example of this can be
found at Adidas, where statistics were used to describe the target consumer–
‘the kid’ –  without questioning whether
this targeting was the most worthwhile choice in regards to the business
environment.

 

The way things are
experienced in culture. In contrast, sensemaking is a process used to
understand the world through the meaning of experiences. It investigates the
different layers that help explain the background to what can be perceived and
analysed outwards. This can be compared to a form of double-loop learning,
going beyond the outer layer of default thinking and hitting at the very core
of the company and the assumptions that underlie its business model (Alvesson & Spicer, 2012). For Adidas, a sensemaking approach revealed that there was a large
customer segment that didn’t participate in sports to compete but to improve
their health. The company had previously misinterpreted this relationships to
sports and had thereby alienated a large portion of potential customers.

 

When undergoing business development, the two perspectives suggest
different approaches to understanding the business environment. Before any process is initiated, default
thinking is appropriate for approaching problems with lower levels of uncertainty. It uses a predictive logic where the
firm usually has an idea about what the purpose of the study is and what the
company is hoping to solve before the process is initiated (Read et al., 2009).

This also facilitates the use of past research
on what is and has been since default thinking is suitable for analysing
information from a known set of data points. In
contrast, sensemaking generally deals with problems with higher levels of uncertainty. In many situations, the investigation
is initiated without any deeper knowledge of what it will bring forward or what
contribution it will have to the company. The future is regarded as
unpredictable, simulating a more effectual approach (Read et al., 2009). The research is thereby more based on what is to come, potentially leading to
discoveries of disruptive technologies that could strike at the core of the
firm’s business model (Bower and Christensen, 1995)

         During the process of business development, the use of past
examples within default thinking leads to the creation of a hypothesis-based inquiry. The generated
hypotheses can often be tested with numbers, thereby resulting in a thorough
collection of hard, measurable evidence
and data. Using sensemaking, the investigation usually takes the form of an exploratory inquiry with qualitative evidence. This captures the
high degree of uncertainty of what the results will reveal.

         After the business development method has been carried through, the
default thinking approach uses the natural sciences of mathematics and
universal law to arrive at answering
what and how much. In this sense, the method has arrived at a form of correctness, supported by data and
numbers that reveal the properties of the world and therefore the way things are. In contrast, sensemaking
uses the human sciences to answer why.

Focus is on getting to the bottom of the business development, discovering the truth of how people experience the
aspects of the world.

 

The two approaches to business development suggest contradictory views of
understanding the world and thereby have different implications for how to get people right. Default thinking emphasises
rationality as a source of
explaining humanity. The complexities of human behaviours are reduced into measurable
accounts and people are regarded as “predictable,
rational decision-makers able to optimise a set of predefined preferences”
(Madsbjerg and Rasmussen, 2014). This encompasses the idea of humans as
thinking beings not influenced by the social context. Further, people are thought
to be fully aware of what they want and need, leading to choices being made by
weighing different options against each other. These assumptions about human
behaviour underlie the usage of default thinking for business development,
where firms ultimately reach the goal of correctness by “asking the right question, designing the right algorithms and
analysing the right data set…” (Madsbjerg and Rasmussen, 2014).

         A contrasting idea, suggested
by the process of sensemaking, is embracing the complexities of the human mind and thus the way consumers behave. This
encompasses the idea of human beings as social creatures, affected by mood and social
context. Further, most decisions are made according to a familiarity with the
world, not the process of actively thinking of which choice is rationally most
suitable. This can be exemplified by Heidegger’s argument on embeddedness,
where humans “… are at our best not when
we are sitting, detached and thinking, but when we are deeply involved in the
world…” (Madsbjerg and Rasmussen, 2014). Also, human behaviour is often
spontaneous and therefore not necessarily based on a long process of
contemplation and weighing of alternatives. These assumptions about getting
humans right ultimately centralise around the idea that “when you understand what drives the behaviour of your consumers, you
will reach a deeper insight that goes beyond the facts of correctness into the
experience of truth” (Madsbjerg and Rasmussen, 2014).

 

Part 2

Default thinking works well when a business challenge revolves around
increasing the productivity of a system.

Facing such a business problem, the company must focus on creating
efficiencies, managing operations and optimising resources (Alvesson & Spicer, 2012). Customers and human interactions are often not regarded as the central
forces of such issues and the assumption of human rationality can therefore be
justified.

 

Sensemaking fits with less straightforward challenges where past data
and scenarios no longer seem relevant or offer a false sense of confidence. If
the business challenge involves the human
factor and therefore demands an understanding of culturally nuanced
questions, input from the human sciences paired with qualitative research
methods can provide valuable insights. If human behaviour is unstable, no
amounts of hard data can bring the underlying background factors to the
foreground.

 

Part 3

“Managing your Diabetes is not a
science, it is an art”1

From my experience of working within the MedTech industry, I believe
this is a quote that captures the essence of living with Diabetes. People with
the diagnosis are facing a life-time of continuous monitoring of blood glucose
levels to prevent life-threatening conditions of hyperglycaemia and/or
hypoglycaemia. To complicate matters further, patients have little to no
guidance to help them on their Diabetes journey. Healthcare practices are
generally short-staffed but more importantly, all diabetics are different. A
glucose level that is perfectly normal for one patient could mean
unconsciousness for another.

 

Nordic InfuCare is a company with the vision of facilitating the lives
of diabetics by providing Continuous Glucose Monitoring devices (CGM). Though offering
an advanced technological product, the company has a history of losing
customers. To solve this business development problem and fully understand the
complex patient-consumer behaviour, Nordic InfuCare would benefit from a method
like sensemaking. There are five steps of the sensemaking process that must be
considered in order to manage and organise it in an effective way.

 

The first challenge of making sense of the world of diabetics is to
figure out what problem the company is attempting to solve. To capture the
truth of why patients are not purchasing Nordic InfuCare’s products, the
company must look beyond sales numbers and understand the patient’s behaviours
and decision-making processes. The company should therefore reframe the problem as a phenomenon,
from “How do we gain more customers?” to “How do our customers’ experience
diabetes?”

 

The next step in ensuring a successful application of sensemaking is the
collection of data. To truly
understand what it is like to live with diabetes, the company must immerse itself
in the lives of the customers. Participatory observation and interviews could
reveal interesting insights not captured by numbers and statistics. However,
this step of the sensemaking process is not easy. When speaking to patients
about their experiences, Nordic InfuCare must realise that they are dealing
with another level of sensemaking – they are making sense of the business
environment using the patients’ sensemaking of their experiences. In other
words, the data collection process can be seen as sensemaking of a sensemaking
process. Therefore, the characteristics of sensemaking must be considered in
order to successfully manage the development of the organisation.

         Sensemaking as a
phenomenon is grounded in identity
construction. In the context of interacting with Nordic InfuCare, interviewees
will bring forward their identities as diabetics. This identity could differ
from the multiple identities that people could possess, and thereby intensify
and magnify the role of the disease in the patient’s life. This could lead to
deeper insights for the company, yet there is a challenge in ensuring accurate
and credible data.

         Further, sensemaking is a
process done in retrospect. In an
interview situation, people are often answering questions by thinking back and
reconstructing experiences of the past. The result could be that situations
that once were chaotic and on the verge of unbearable are made sense of into
something less abstract. In other words, true experiences of being a diabetic
could be rationalised into a more comprehensible narrative of discrete segments.

         Another aspect of
sensemaking applicable to this situation is the social aspect of it. Publicly having to share intimate stories of
one’s disease could result in details and actions being distorted or left out.

Further, diabetics could be participating in a collective sensemaking of their
disease which would lead to utterances incorporating the opinions and
sentiments of other people in the individual’s life. This is especially
important to consider when interviewing children since they are often very
susceptible to the experiences of their parents.

         Further, most diabetics
have lived with their disease for multiple years and it has therefore become a
large part of their lives. Interactions with CGM-devices and glucose injections
are parts of a routine and an ongoing
process, leading to diabetics rarely having to make sense of it. This can be
related to the interviewees’ use of extracting
cues. For an outside interviewer, it might not be visible that the diabetic
is constantly aware of their health and any feelings of nausea, vertigo and
temperature changes. A continuous elaboration of current health state could
have become habit of the diabetic and might therefore not be questioned or
reflected upon in an interview situation.

         Finally, diabetes is a
condition that often engages people emotionally. Answers and reasoning are
therefore not always rational and thought-through. Opinions are driven by plausibility rather than accuracy,
where diabetics are not looking for the optimal solution in a scientific sense
but a solution that works for them personally.

 

Moving on from the data collection, the next challenge of the
sensemaking process is for Nordic InfuCare to use the data in a worthwhile
manner. Vast amounts of information and personal stories are worthless if any patterns in the data can’t be spotted
and if key insights can’t be
created. Further, not only do these have to reconcile with the collected data
but they must be feasible in order to build any sort of business impact from the sensemaking process.

         To solution to this
challenge is the moment of clarity.

Companies must use their findings to reach an ‘aha-moment’, otherwise a lot of
time and effort have been put into a process not interesting in the perspective
of business innovation. When I worked for Nordic InfuCare, the sensemaking
process described above was applied to get a grasp of what was lacking in the
industry. The answer – and the moment of clarity – felt almost too simple. For
a long time, the industry of CGMs had revolved around designing superficial
products that could be used in combination with the device. For example, Nordic
InfuCare had focused on targeting the perceived shamefulness of having a
visible CGM attached to one’s body, designing accessories to cover up the
medical equipment. This business development wasn’t a success with the
customers because it didn’t target their ultimate issue. Diabetics didn’t care
about the shamefulness of the disease. Diabetics cared about their lives. Though
providing the most technically-advanced product on the market, CGMs still couldn’t
provide a completely accurate blood glucose level. Nordic InfuCare had to
return to its laboratories and invest in its research and development teams to
focus on the actual performativity of the product.

 

For a diabetic, life can seem extremely complicated. What works for most
people, eating a piece of chocolate or going for a short run, becomes a puzzle
of insulin calculations and needle preparations. Therefore, it is not strange
that making sense of the CGM industry is a complex task. Challenges involve
defining what problem the industry is actually trying to solve, how to collect
reliable data without too much influence from the properties of sensemaking and
transforming the discovered patterns and insights into valuable business impacts.

However, as suggested above, these problems can be handled by carefully
monitoring each step of the sensemaking process and considering which outer
stimuli could potentially distort the results. Just like the initial quote
suggests, this makes it apparent that diabetes is not a challenge to be solved
using the natural sciences and default thinking. Diabetes is an art and must
thereby be approached using the human sciences and the process of sensemaking.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

References

Alvesson, M.

and Spicer, A. (2012). A Stupidity-Based Theory of Organizations. Journal of Management Studies.

 

Bower, J. and Christensen, C. (1995). Disruptive Technologies: Catching
the Wave. Harvard Business Review.

 

Madsbjerg, C. and Rasmussen, M. (2014). The Moment of Clarity. Boston, Massachusetts: Harvard Business
School Publishing.

 

Read, S., Dew, N., Sarasvathy, S., Song, M. and Wiltbank, R. (2009).

Marketing Under Uncertainty: The Logic of an Effectual Approach. Journal of Marketing.