Great quote on a topic I discussed in, How We Know What We Know. Dr. Deming included the theory of knowledge as one of the 4 pillars of his management system. When you do not question what you think you know, and conventional thinking, that will keep you from discovery. Now much of conventional wisdom is right, so you often do well accepting whatever most people believe. But to discover you have to seek out new knowledge. And often the process is stopped before you even form the questions, because you think you have knowledge.
How can you understand if your beliefs are in fact knowledge? Test them. Do you have evidence that performance appraisals add value to your organization? Do you have evidence that outsourcing production is beneficial? Do you have evidence that paying CEOs a king’s ransom is helping? What evidence do you have that sales bonuses help the organization? If you don’t have evidence then you have a belief, not knowledge. You can be ignorant and hold a correct belief. Knowledge requires understanding not just correctness. At least that is how I see it, I am not sure what the philosophers say about this.
I also believe you can have evidence that seems to support your belief but still be wrong. You could site examples where sales bonuses seemed to stimulate extra sales that helped your company. But you could be failing to understand the full system and the other factors that 1) helped make the sale and 2) what damage the sales bonuses did that you didn’t consider. Knowledge isn’t easy. But most that are knowledgeable seek to question their beliefs and assumptions.
Related: Bogus Theories, Bad for Business – The Illusion of Understanding – Flaws in Understanding Psychology Lead to Flawed Management – confirmation bias – Pragmatism and Management Knowledge – Optical Illusions and Other Illusions
Certainty is risky. But I am also basically certain about many things (and think that is wise). I don’t have any doubt about how gravity it going to act on what I see in my daily life. I don’t doubt if I don’t take in liquids for days I will suffer and die eventually. I don’t doubt in trying to manage an organization you need to account for the psychology of people.
I don’t think trying to hire by algorithm is a good strategy. I have a number of pieces of evidence for this, the strongest is how poorly I see most organization understand data. I have not seen much evidence that discrete data points are much help in deciding if someone will be a good employee. Google however, overcomes some of my initial objections. Google has shown a remarkable ability to actually use data effectively where others just fail utterly. I still doubt this is a great strategy, but I am less confident it is a bad strategy is Google is doing it than most anyone else tried. Also I think the hiring process is very inefficient (so what the heck, the bar to succeed isn’t be too high, and the price of failure is much less than it would be if the hiring process were normally great and getting the exactly right people into jobs).
One of the challenges is that you need to be willing to question your beliefs but at the same time you need to make many decisions every day based on your beliefs. And I don’t think it is wise to assume nothing. You need to make a huge number of assumptions everyday or you won’t even be able to get out of bed – questioning every little thing (just getting out of bed you have to assume you are not going to fall through the floor when you step off). But there are risks of assuming you know much more than you do. And that illusion of knowledge is something that makes people much less effective than than they could be if they better understood what they knew and the weight they should give to their various beliefs.