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  Is It Okay To Be Paranoid If They Really Are Out To Get You?

by Cliff Kurtzman
Chief Executive Officer, ADASTRO Incorporated.

August 18, 2004

"What are the facts? Again and again and again - what are the facts? Shun wishful thinking, ignore divine revelation, forget what 'the stars foretell,' avoid opinion, care not what the neighbors think, never mind the unguessable 'verdict of history' - what are the facts, and to how many decimal places? You pilot always into an unknown future; facts are your single clue. Get the facts!"

-- Robert A. Heinlein in "The Notebook of Lazarus Long"

A few months ago I was on a business trip in Florida when I picked up a copy of USA Today and read an article about Donald Trump and his thesis that paranoia is good for business. This got me thinking about how common cognitive distortions can affect our ability to achieve success.

Those afflicted with paranoia have a distorted world view. They suspect negative things about others which are untrue, and they let their distortions cloud their thinking and decisions. Donald Trump's opinion not withstanding, this is clearly not something which we want to do in our businesses thinking.

While it is never okay to be paranoid (because being paranoid is being distorted), it is appropriate to be cautious, prudent and strategically competitive. It is appropriate to work to understand the agendas of those with whom you do business. There clearly are those out there that do seek to cause harm to our business interests. Some competitors compete for business with us in a professional manner, while others might engage in wrongful activities to try to get a competitive edge. Employees might see it as easier to steal from their company and engage in unethical or criminal conduct rather than to work for their wages in the manner we expect from honest individuals. Believe me, over the past 15 years I've seen it all. Putting on blinders to the realities of the business world is every bit as distorted as imagining things which are not there.

So how the heck can an organization stay grounded, and deal with the realities of the world without allowing itself to become distorted? In my experience, I've seen two types of distinct corporate cultures: Let's call them Type A and Type B.

The Type A corporate culture is one in which people operate on the basis of rumor and hearsay. The workplace becomes histrionic, drama queens and kings are ever present, and employees engage in frequent "scandalmongering." Staff members speculate on the future of their business, their competitors, as well as their co-workers based on loose conjecture and wild extrapolation of facts. Employees in this type of culture tend to be quick to assign blame, share disruptive information with those who have no business need for that information, and magnify the repercussions of negative events.

The Type B corporate culture is one in which the spreading of rumor and hearsay is replaced by fact finding, analysis and investigation. Employees stay focused on their part of making the organization successful, and when information of a speculative nature is acquired, it is understood to be speculative and passed on for further investigation only to those that have a need to know. Employees in this type of environment typically shun jumping to conclusions until all the facts have been acquired, and work to minimize and contain the repercussion of negative events. Responsibility and authority tend to be very well aligned in this type of an organization.

Organizations with Type B cultures tend to be successful far more frequently than those with Type A cultures. While it is unfortunately easy to go from having a Type B culture to a Type A culture, it is far more difficult to shift an organization with a Type A culture towards Type B. Getting and keeping an organization on the Type B track requires strong and effective leadership led by a corporate management team that both preaches and practices the avoidance of cognitive distortions on a daily basis, and which makes an active effort to educate employees prone to Type A behavior in how to change their behavior to Type B.

The field of Cognitive Therapy recognizes ten common Cognitive Distortions, or faulty thought patterns, that can interfere with our ability to make sound decisions, both in our personal and business lives (see: ). In this edition of the Apogee, we will take a look at these Cognitive Distortions and examine how they might apply to some common business situations:


DISTORTION #1: ALL-OR-NOTHING THINKING: Seeing things in black-and-white categories.

Example: An employee applies for a promotion in her firm. The job went to another employee with more experience. The employee wanted this job very badly and now feels that she will never be promoted. She feels that she is a total failure in her career.

Reality: The company felt (for either subjective or objective reasons) that another employee was better qualified for the position that was being filled, at that particular time. Such a decision by itself does not mean that the employee is not a strong contributor to the organization, nor does it imply that she isn't qualified for promotion or that she will not be promoted at a later date. The employee should try to use the situation as a learning experience to understand how she might improve to increase the chances that she will be the one selected the next time an opportunity for promotion becomes available.


DISTORTION #2: OVERGENERALIZATION: Seeing a single negative event as a never-ending pattern of defeat.

Example: A salesperson works hard on getting a new contract for their company, but the decision goes to a competitor. They start to feel as though they won't ever succeed, or that their company is not able to compete effectively.

Reality: Each battle takes place on a new battlefield. The employee would be better off using the experience to understand why their proposal was not accepted, and improving their offer and presentation for the next potential client.


DISTORTION #3: MENTAL FILTER: Picking out a single negative detail and dwelling on it exclusively so that one's vision of all reality becomes darkened, like the drop of ink that discolors the entire beaker of water.

Example: A competitive coworker takes credit for your work in front of the client and the boss. You then starts thinking all of your coworkers will act towards you in a similarly unethical manner.

Reality: In a healthy organization, employees realize that their success depends on the success of their coworkers. The individual that will take credit for someone else's work is the exception rather than the rule, and will likely soon find that they have worked themselves into situations which provide them more embarrassment than benefit.


DISTORTION #4: DISQUALIFYING THE POSITIVE: Rejecting positive experiences by insisting they "don't count" for some reason or other. In this way one maintains a negative belief that is contradicted by everyday experiences.

Example: After improving his proposal, a salesperson wins the contract on his next sales pitch. But instead of enjoying the moment and seeing it as the start of better times, he brushes the win aside as an anomaly due to an extraneous factor that won't likely ever be repeated.

Reality: One that endeavors to continuously learn and improve their skills will in fact perform better over time.


DISTORTION #5: JUMPING TO CONCLUSIONS: Making a negative interpretation even though there are no definite facts that convincingly support your conclusion.

5A: MIND READING: Arbitrarily concluding that someone is reacting negatively to you, without bothering to discover the facts.

5B: THE FORTUNETELLER ERROR: Anticipating that things will turn out badly, one starts feeling convinced that their prediction is an already-established fact.

Example: Someone leaves your company and you ask to take on their job. Your boss tells you that she will consider it. Two weeks pass and she doesn't say anything, and you figure it is because she doesn't think you are qualified and is looking for someone else to fill the job. You become convinced you are not going to get the job, and start circulating your resume at other companies.

Reality: There are lots of possible explanations, but without facts there is no way to come to a rational conclusion. It is possible that your boss knows that an even better position might be opening up to offer to you, but she is holding off on telling you anything until she is certain of the opening and has approval from her management to offer you the position. When we don't understand someone else's behavior, there is often a natural tendency to create explanations that may turn out to be wholly inaccurate. The key is to seek the information that will allow one to constructively place the behavior into perspective.


DISTORTION #6: MAGNIFICATION (CATASTROPHIZING) OR MINIMIZATION: You exaggerate the importance of things (such as your goof-up or someone else's achievement), or you inappropriately shrink things until they appear tiny (your own desirable qualities or the other fellow's imperfections). This is also called the "binocular trick."

Example: You have been preparing for an important business presentation for weeks, in order to sell your company on the idea of moving forward with a new line of business. During the presentation, some of your managers take issue with a few of the numbers on one of your slides, and you can't recall all the right facts to back up the data. You leave the meeting demoralized, thinking that there is no chance your proposal will be accepted.

Reality: It is very possible that your audience had an overall positive reaction to your concept, but just some questions about the details. You need to take the opportunity after the meeting to provide the needed back up data and close the deal, rather than giving up because one part of the presentation went poorly.


DISTORTION #7: EMOTIONAL REASONING: You assume that your negative emotions necessarily reflect the way things really are: "I feel it, therefore it must be true."

Example: A business owner looks at her business and sees nothing but problems. "All my managers are fighting with each other. I've just lost my two largest clients. My bills are not being paid. It is so hopeless, I might as well give up."

Reality: The business owner is reaching a conclusion based on how she feels, not based on how things really are. In reality, each situation is solvable. She needs to break down each situation into a systematic plan for improvement, prioritize the activities, and start fixing each situation one at a time.


DISTORTION #8: SHOULD STATEMENTS: You try to motivate yourself with should and shouldn't, as if you had to be whipped and punished before you could be expected to do anything. "Musts" and "oughts" are also offenders. The emotional consequences are guilt. When you direct should statements toward others, you feel anger, frustration, and resentment.

Example: You feel you should be able to be more persuasive in convincing your boss to take a desired course of action, but you aren't. Then your boss does something they should not have done, and it hurts your business. You end up expending a lot of energy dealing with your and your boss's failings.

Reality: The reality is that you can only do your best to persuade your boss, and that in the end you cannot control another human being. The decision and responsibility in this instance rested with your boss. If your boss blew it, then it was their mistake to make, and it is out of your control. You need to focus your energies on things you are able to control and what you can do in the future, and not worry about what you might have done in the past or what others should or ought to have done.


DISTORTION #9: LABELING AND MISLABELING: This is an extreme form of overgeneralization. Instead of describing your error, you attach a negative label to yourself. "I'm a loser." When someone else's behavior rubs you the wrong way, you attach a negative label to him: "He's a totally worthless employee." Mislabeling involves describing an event with language that is highly colored and emotionally loaded.

Example: An employee makes a recommendation that ends up working out poorly. As a result, you label the employee as not being competent in all regards, and disregard that employee's advice in all further matters.

Reality: A single failure in one area does not imply incompetence. There is risk inherent in any decision, and any employee that is not willing to have a few learning experiences is probably not worth having as an employee. Instead of labelling the employee as not being competent, look at why the employee failed: were they taking an acceptable risk that just didn't pan out? Were they acting outside of their domain of expertise? Do they need additional coaching and education to not make similar mistakes? Did they learn from their experience and understand how to use it to make them more valuable to the organization? If there are reasonable answers to the above questions, then it makes no sense to consider the employee as having poor performance. On the other hand, if there is a steady string of failures without any perceived learning and improvement, then it is perhaps time to consider allowing the employee to find their true calling in life rather than to continue working for your organization.


DISTORTION #10: PERSONALIZATION: You see your self as the cause of some negative external event, which in fact you were not primarily responsible for.

Example: After two years of profitability in your division, you get promoted to division head. In your first year on the job, your division loses money, and you blame yourself for the failure.

Reality: The failure to achieve continued profitability can stem from a number of factors, and you need to conduct an investigation to get a realistic picture of the situation. For example, it is entirely possible that an economic downturn affected your entire industry, and while you may not have maintained profitability, you in fact outpaced all your competitors over the same period. That doesn't mean it is acceptable to be unprofitable... it just means that you have not underperformed, and you will be better able to devise an appropriate strategy to bring your division back into a profitable mode of operation.


By learning how to recognize each of these ten scenarios, you will be on a path to changing behavior and improving business perceptions and decisions within your organization.

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