The Power of Habit

In his latest book, The Power of Habit Why We Do What We Do in Life and Business, Charles Duhigg, a prominent journalist on the staff of the New York Times analyses the effects our habits have on our lives. He studies habits as they apply to the following:

·         Giving up smoking

·         Fitness and weight loss

·         How Proctor &  Gamble market their products

·         How habits are important in social movements

·         How habits affect corporate culture

·         Military organisations

·         American Football coaching

·         Organisational behaviour

Habits can be simply be defined by the following diagram:

All habits both good and bad have the characteristics above. More importantly as they become habits, your conscious mind is not even involved in their execution. I particularly enjoyed his analysis of the leadership of Paul O’Neill. The story told in the book is this:

In 1987, the Aluminium Company of America (Alcoa) held a meet and greet to introduce the shareholders to their new Chief Executive. The stock of the company had been sliding and investors were very worried. Paul O’Neil was a former government bureaucrat and Wall Street had never heard of him. O’Neill took the stage and said, “I want to talk to you about worker safety.” He then proceeded to outline safety targets that he was going to meet in his quest to make Alcoa the safest company in America. The audience was confused. Where was the discussion of profits and new strategies??? Words like synergy, leverage and rightsizing?? He then proceeded to give the audience a safety briefing and indicated the emergency exits and how to exit the building.

Bemused shareholders held up their hands and started asking questions about capital ratios. Another asked about inventories in the aerospace division. O’Neill stood firm.

 “I’m not certain you heard me. If you want to understand how Alcoa is doing, you need to look at our workplace safety figures. If we bring our injury rates down, it won’t be because of cheerleading or the nonsense you sometimes hear from other CEOs. It will be because the individuals at this company have agreed to become part of something important: They’ve devoted themselves to creating a habit of excellence. Safety will be an indicator that we’re making progress in changing our habits across the entire institution. That’s how we should be judged.”  

There was a stampede out of the doors when the presentation ended. Investors told everyone to sell as the Board, ”had put a hippie in charge.” To hear what happens next, I recommend you read the book. Mr Duhigg emphasises that any self-respecting must learn to use crisis to his advantage and ensure the chance is not lost to change corporate habits. This is what the other part of the book is about. Whilst we may be governed by habits, we all possess the free will to make new or better habits.

The Zambian energy sector is in crisis. Have we also fallen into habits we think we need to change? What new habits should we be building to navigate our way out of the crisis? Is a shutdown of the refinery our cue? What is the reward at the end of every cycle of imports and shortages?