How can you use Red Team to overcome your mental blind spots?
We’ve all had a project go south, and in looking over the facts hindsight is always 20/20. Oftentimes we focus so hard on creating positive imagery in an effort to make ideas work, that we end up creating mental blind spots about possible pitfalls along the way. So how can we anticipate mistakes before they happen? In other words, can we make foresight be 20/20?
Bryce Hoffman was an award-winning financial journalist who spent 22 years covering the global automotive, high-tech, and bio-tech industries. He is the author of the best seller American Icon: Alan Mulally and the Fight to Save Ford Motor Company. He's also the first civilian to have ever graduated from the U.S. Army's Red Team leader program at Fort Leavenworth, and his new book is Red Teaming: How Your Business Can Conquer the Competition by Challenging Everything. I recently interviewed Bryce on the LEADx Podcast to talk about Red Teaming and how we can all incorporate it in our lives. (The interview below has been lightly edited for space and clarity.)
Kevin Kruse: What do you mean by ‘Red Teaming’? What is it?
Bryce Hoffman: Red Teaming, Kevin, is a system that was developed by the military and intelligence agencies after 9/11 to basically help them stress test their strategies and really vet their plans and see if they could make them better by challenging the assumptions they were based on. That's really how Red Teaming works. It involves taking a plan, a strategy, a proposal, and breaking it down into the assumptions that it's based on. Then challenging those assumptions to make sure that they're really true, that they're really valid and that they will remain valid under all circumstances. That's really what makes Red Teaming different than other management tools I've encountered. It’s this element of deliberate challenge. Basically trying to poke holes in your own work.
The reason why the military and intelligence agencies developed this is because they realized that it was what they didn't know that hurt them. In the case of the CIA, all of the intelligence that came in ahead of 9/11 about the plans to attack the United States that went ignored, that was disregarded because it didn't fit in with the mindset that people had. In the case of the U.S. Army, which has really taken the lead in developing this, recognizing in 2004 that these victories that we won in Afghanistan and Iraq were just falling through our hands because there were so many things we hadn't thought through. Red Teaming was a system they developed to systematically go through plans and strategies and look for what you're missing. Both in terms of threats but also in terms of missed opportunities and seeing if you could make them better. I thought when I heard about this system businesses could benefit from this as least as much as the U.S. military has.
Kruse: It's not just to look for flaws but the missed opportunities, or how could you make something better.
Hoffman: Exactly. You're a writer like me Kevin and you know as well as I do that there's no writer in the world that can edit their own copy. It's not because we're bad writers, it's because nobody can check their own work. We all have blind spots. We think we know what we wrote, so what we see is what we think we wrote rather than what we actually wrote. That's why we have editors, somebody else who can come in and look at our work and say “Well, you missed a word here,” or “Wouldn't it be better to say this this way?” or “Did you think about how someone might misinterpret this?” If you look at things that way, that's really what Red Teaming is about. It’s having another set of eyes on the problem, someone to check your work.
Kruse: You write about how we all need Red Teaming because we have inherent biases. What are the biases that we all have?
Hoffman: That's a great question, Kevin. Red Teaming is really based on the most cutting edge research in the area of cognitive psychology and human decision-making. Work done by people like Daniel Kahneman and folks like that, that have really opened our eyes to the fact that we really don't know what we don't know. Let me give you an example of what I mean by that. There's a whole array of biases and heuristics; heuristics is just a fancy word for mental shortcuts that our brains take. When we try to make decisions about complex problems, one of them for instance is called ‘loss aversion.’ It's something that most people have probably heard of. Loss aversion refers to the fact that we're hardwired in such a way that we would rather avoid a loss than reap a reward and there's been experiment after experiment that has shown that this is true of people all over the world. How does this affect business? Well let me give you one example. We all remember Polaroid right?
What most people don't know is that in the late 1990s, Polaroid was actually the market leader in digital photography in the consumer space. They had one of the best-selling consumer digital cameras, but they had a board meeting with their senior executive team and they looked at their digital photography business, and they looked at their existing film business, and what they saw is that their margins for their film business were in an excess of 65 percent. The conversation that they had with themselves was not “How can we take advantage of this new opportunity that digital photography is creating for us?” But “How do we avoid losing those awesome margins that we have on our film business?” As a result of that discussion they decided to pull back on their digital photography business and double down on their film business. We all know what happened as a result of that, but that sort of short-term thinking happens in all sorts of companies, in all sorts of industries.
That's just one example, too. We have a whole other array of biases. There's the ‘planning fallacy,’ which is one that doctor Kahneman has talked a lot about. Which shows that we have a tendency when we create forecasts and plans to make them, as he puts it, unrealistically close to best case scenario. They've proven this. For instance in 2005, there was a study done that looked at rail projects around the world that had been built from 1969 to 1998, and what this study discovered is that planners overestimated the numbers of passengers that would take advantage of these new improvements 90 percent of the time. Now, there had been tons of reports written over that 30-year period about how many of these projects failed to achieve what their estimates were, but guess what? Nobody paid any attention to that when it came time to develop their forecast.
So Red Teaming is designed to combat these types of biases by forcing organizations to look at things objectively. In the case of loss aversion, to really objectively look at the potential gains of a new option, not just the potential loss. In the case of planning fallacy, it is to compare forecast to similar cases and seek out relative data that puts goals and targets in their proper perspective, rather than just shooting for the moon and hoping for the best. This is just a couple of them; there are dozens of these fallacies.
Kruse: I’m sure the CIA has whole teams that do this, but how might you apply the Red Team concept to say, a regional sale manager?
Hoffman: That's a great question, and obviously you hit the nail on the head, Kevin. There are very few organizations, even large companies, that are gonna have the resources that the military and intelligence agencies have to create these standing Red Teams. Even the military and the CIA have increasingly found value in driving Red Teaming down through the organizations. As valuable as it is to have a standing Red Team, you can use the same tools and techniques that I teach people how to use in my book, as a frontline supervisor.
So let me give you an example, you brought up the case of a regional sales manager. As a regional sales manager, you can get together with your team and use some of these tools. For instance, one of the most simple tools in the Red Teaming arsenal is simply called a ‘key assumptions check,’ where you take your strategy, you take your plan whatever it is, and you break it down into the assumptions that it's based on. Then you ask yourself a series of questions, which I talk about in my book. Things like is this likely to be true under all circumstances? If it isn't true what is our plan for dealing with it not being true? Is this based on wishful thinking or can we prove that this is the case, and if we're not sure how can we get that information before we execute? Things like that.
You can have this discussion as a team, examining your own work, and you will get a lot of benefit from that. Maybe not the full benefit of having a separate set of eyes come and look at it, but a lot more than if you just teed it up and hit the ball without doing that analysis. What I tell people is that even if you don't have a team at all, even if you're just a frontline manager sitting in your office by yourself trying to do what you can to make sure that you're gonna succeed in the strategy or the plan that you've been given to execute. One of the simplest things you can do is just ask this question; “If this goes wrong, how will it go wrong?”
I'll tell you a quick story. As you mentioned, I was the first civilian from outside the government to go through the Red Team leader course at the U.S. Army's training school at Fort Leavenworth, which is considered the gold standard for the world. Other countries send their officers there, even the marines send their folks there. It's an amazing program. One of my classmates was a Delta Force commander, and he asked a question in class. “If I'm out on a mission, how do I Red Team something?” Our instructor said, “Even if you just have 15 minutes, you have time for Red Team analysis, because what you can do is gather your men together, take a knee and say we need to take this village here. If this goes to heck, how is this going to go to heck? If you have that discussion, it will at least make you better prepared to deal with some of the unexpected ways that things could go south than if you didn't have that discussion at all”.
I tell the same thing to business managers. If nothing else, before you embark on something or make a decision, just take five minutes and ask yourself “If this goes wrong, how is it going to go wrong?” And then try to think about what you're gonna do if those things happen. The key Kevin, is you have to answer that question honestly. If you're gonna do this yourself, you've got to be honest.
Kruse: I've had a lot that go wrong, and this one question would've saved a lot of time, money, and heartache.
Hoffman: Absolutely. It's interesting that you say that because what you just described there is a technique developed by Dr. Gary Klein, who's one of the foremost cognitive psychologists in the area of human decision making. He has a very similar technique he calls ‘Pro-Mortem analysis’, which is just that. Trying to imagine what success looks like so you can really gauge what the metrics are that you're going to use to judge success.
He also has a tool that he developed first, that's a key tool in the Red Teaming arsenal, and it's called ‘pre-mortem analysis.’ In a pre-mortem analysis you do just what you described, Kevin. You ask the question “Imagine it's a year from now, or two years from now depending on the project, and it has failed miserably. Not just a little bit, but it has been an unmitigated disaster. How did that happen?” It's not a negative thing; it's not setting yourself up for failure. It's purpose is to show you the ways that it could fail so you could address those, so that you can close those gaps, plug those holes, and make sure that doesn't happen.
One of the things that I tell people that I work with in business is that unintended consequences are the consequence of insufficient planning. If you look at things—pick any high profile business disaster you can think of—and you'll see that if somebody had asked the question “How can this go wrong?” You probably could've figure that out. You probably could've figured it out. The problem is that we don't ask those questions. We just want to move forward. You're absolutely right, Kevin. There's nothing wrong with being positive and enthusiastic about this, about what you're doing in your business, in anything. You also have to be realistic and you have to balance that enthusiasm with a little bit of an analysis of what the risks are so that you can take advantage of the opportunities.
Kruse: It might even be more powerful to lead with “Imagine it's a year from now and this is an unmitigated disaster, what would that look like?”
Hoffman: Absolutely. I'll tell you a story Kevin. Red Teaming is a new concept in business, there's not been a lot written about it outside the military and intelligence worlds, but there's been a few companies that have learned about it and are using it. One of them that I talk about in my book is an investment firm. They use Red Teaming to make their investment decisions. This is what one of the senior partners explained to me, he said the way that most investment firms work, is that one of the partners will come to one of the other partners with a great idea for making money. They'll say “Here's an investment strategy I just came up with, here's how I think we can make a lot of money on this.” That's what every firm does.
He said what we do, because we use Red Teaming to approach this is, he says “I assume that if these guys on my team are good enough to be partners, that they know how to make money. So why do I need them to come and explain to me how we're gonna make money on this deal? I know that they're smart enough that if they're gonna go to the trouble to come and propose an investment strategy to me, that they've already figured out how we're gonna make money on it. So what I ask them to do instead, is tell me how are we gonna lose money on this investment.” He says what that does is allows us to have a really robust discussion about the risks and the opportunities of this investment target. They have been much more successful than their peers since they've started doing this.
It's an amazing thing, just like you say. Everyone else is gonna do that, everyone else is gonna take that same approach or say “Here's how this is gonna go right.” Imagine you were building a house for yourself and you hired a contractor. Would you want to go with the contractor who tells you this is how everything is going to be so wonderful when we're building your house, you're not going to have to worry about anything, it's going to be just the way you want it when it's done? Or are you gonna want to go with the guy who says I'd really like to build this house for you, here are a couple things I've noticed in your plans that could be issues and here's how I'm going to address them? I mean, to me it would a no brainer which of those contractors I'd hire.
Kruse: I always like to challenge our listeners to get a little bit better every day, so what's something we could go out and do right away?
Hoffman: What I tell people, Kevin, is the thing you can do right now without knowing any Red Teaming tools or techniques, is when you're making a decision, when you're getting ready to execute a strategy, when you're getting ready to launch a new plan have someone you trust on your team give you honest feedback. That's the key. Don't give it to a yes man, or woman. Give it to someone who's going to give you honest feedback. Have them look at it and tell you that. Ask them “What could go wrong with this?” If you do just that one thing—and this doesn't have to be long it can be 15 minutes—they will give you something to think about, and to keep an eye out for as you execute your strategy or plan.
You may see six months from now that flag that they raised, you might see it starting to blow in the breeze. Well there's still time to adjust your course and avoid going down that road. That's my advice to folks, is to just take the time to have somebody else look at what you're about to do, look at it critically, and tell you if this could go wrong, here's how I think it could go wrong. Doesn't mean it's a bad plan, it could be the best plan in the world but just doing that will make it an even better plan.
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Kevin Kruse is a New York Times bestselling author, host of the popular LEADx Leadership Podcast, and the CEO/Founder of LEADx.org, which provides free world-class leadership training, professional development and career advice for anyone, anywhere.
