Denial Class Discussion Questions – I would suggest that you develop notes for these.
1. What is denial and what problems does it lead to?
Denial is how we pay attention to everything today; we are constantly making unconscious choice about what to notice, and not to notice. It means when something happened and the person lies to cover up or used to escape from the truth, According to the book, Denial is the unconscious calculus that if an unpleasant reality were true, it would be too terrible, so therefore it cannot be true. Denial today is all around us, if we ignore the obvious at a certain moment because we simply don’t want to confront it, it might lead to more problems. The longer we ignore it the more serious it will become and the more difficult it will be to get back to normal.
2. What caused the downfall of the US tire industry?
According to the book, US tire industry looked like destiny and it would last forever during the 1910s, the downfall of the US tire industry happened in year of 1970s and 1980s, the causes is because of their denial of the impact of the new technology took place in two distinct phases. First they refused to believe that radial tires would succeed in the American market the way they had in Europe. Second, after it became clear that radials would indeed make it in America, the tire manufacturers denied that their world would change forever.
3. How does group think affect organizations?
In an environment of groupthink, minimizing conflict becomes the primary goal rather than producing concrete results or achieving true consensus. Groupthink can create an overwhelming desire for unanimous decision. If group thinking has taken over a collaborative effort it can be difficult, if not impossible, to get a variety of suggestions on any issue because each individual member of the group has sacrificed his ability to think outside of the box in favor of conforming the norms developed by the group as a whole.
4. How can an organization avoid a “yes-man’ culture?
The yes- man culture is people thinks what other did is right, and sometime may be afraid to speak up and point out things could go wrong. According to the book, to avoid a “yes-man” culture, a good CEO is a must. Because when everyone is agreeing with he/her, the CEO needs to sense that he is in trouble. A good CEO need to make his employees to be able to feel comfortable saying no on an issue. Also an open communications is needed. In a n open communications environment, worker feel safe and secure about what they are going to say.
5. A&P successfully managed the market for a long time. Discuss their successes and what ultimately lead to their failure. Was it destroyed by fire or did it rust away?
A&P was aggressive. It increased the number of stores and diversified its product lines, which can attract other groups of customers. A&P also sell its tea for less and make its money on volume compared to its competitors that rising the prices and make their money on margin. A&P increased using the gimmicks such as premiums and trading stamps. It also provided the full range of services, such as delivery, for its customers, and these costs were added expenses. In addition, A&P improved the quality of its products, the appearance and standing of its stores, and attains greater respectability. Hartford had one big idea about grocery retailing: high volumes at low prices. A&P used backward integration, in some categories all the way to the farm. It owned and operated about 15700 stores and annual volume exceeded a billion dollars. With the supermarket innovation, A&P did not take it very seriously at first, but they knew by 1935 that something had to be done to meet the supermarket challenge. In 1938, A&P made the decision to transform itself into a supermarket company, and this change had increased its sales ($3.2 billion) and profits ($32 million) tremendously in 1950.
What ultimately lead to their failure was that A&P denied its sales and profit statistics; the executives only celebrate the statistics they liked and ignore the statistics they did not like. A&P did not change its traditional policy, which was signing leases at a short-term basis. When the nation was growing wealthier, many people moved to suburbs and many malls were developed, but when the developer asked for longer leases, A&P refused to sign them and shut itself out of the quickly growing market. In addition, A&P abandoned the entire West Coast market, which was a growing market as well and have huge potentials and opportunities. With the television innovation, A&P loses its consumer support as the growth of national television advertising drives increasing customer demand for national brand products, while A&P was continuing emphasis of its private-label marketing. A&P also started the price war, which caused the company had huge losses and eventually give away the stores. A&P was not destroyed by fire, it rusted. It believed that it had been the leader in this market for such a long time and kept denying problems instead of avoiding the problem and fixing them; and eventually, it collapsed.
6. What initially did Sears do right?
The Sears’s CEO Robert E. Wood sensed the pent-up consumer demand that would be unleashed with the demobilization of the armed forces after his luncheon with Sewell Lee Avery. Wood’s interest in population trends undiminished and saw the nation taking Greeley’s advice, which was “Go West, young man, and grow with the country.” In 1949, Texas and California became the Sears’s two biggest states. Sears also opened Brand Central in its stores, which were full of manufacturers’ branded products side by side with their own private-label merchandise. In addition, Sears had a very good return policy, which attracted huge group of customers, if one item did not work, you could return it, and if you were in other location, you could return the item to the Sears’s store in that location even though it might not be the store that your originally purchased at.
7. What role did talent or lack thereof play in denial at Sears? What does “beware the monument” mean?
When Sears lost its viable competitor, Ward, it viewed itself as having no competition ignored Kmart and Wal-Mart’s developments in the market. When the sales and profits increased tremendously from 1962 to 1973, Sears’s arrogance arises, as it viewed its only competitor is itself and its executives would tell each other. This caused Sears fell so far off the pace when Sears would not admit for the longest time that Wal-Mart and Kmart were its real competitors. Beware the Monument means that if the meaning of the statue was not clear enough, he had inscribed on the pedestal that he was such a big shot that “ye Mighty” were reduced to despairing at his magnificence. For example, when Gordon Metcalf became CEO of Sears in 1967, he believed that “being a largest retailer in the world should have the largest headquarters in the world.” And Sears built the world’s tallest building, the 110-story Sears Tower. And eventually, the company abandoned its Tower in 1992 and lost about $4 billion, and Kmart adopted Sears’s name called Sears Holdings.
8. What was the root cause of IBM’s problems?
IBM’s hidebound culture and leadership are the roots cause its problems. It denies the lessons of its own history, and it also denies the coming of one of the greatest technology revolutions ever, the personal computer. The company denied that it had been fundamentally transformed by the trauma of giving birth to the 360, and its culture was unable to adjust to this transformation. IBM bought the components of its PC from outside vendor and allowing Intel and Microsoft to sell to others in the PC market, IBM guaranteed the creation of competition.
9. What role does denial play in the development of speculative bubbles?
10. How did the “madness of crowds” ultimately affect Webvan?
11. What role does culture play on the impact of denial within an organization – Ford vs. DuPont
12. What role does inclusiveness play in the success of an organization?
13. Explain the phrase “Denial is not a matter of intelligence. It is a matter of point of view.” P. 178
14. What did Johnson &Johnson do to prevent it from falling prey to denial?
15. What does the author recommend to combat denial?
16. What role do Cassandras play in an organization?
17. Do you agree with the statement “Denial goes hand in hand with short-term thinking.” Why or why not?
18. What role does language play in denial – see page 211 – 212.
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