As the CEO, there's pressure to be the one with a plan at all times. And if you don't have the solution, the onus is on you to get one quickly. 

"For lack of a more sophisticated term, [there's] peer pressure to be the gal or guy who knows," Stephen Dubner recently told Knowledge@Wharton in an interview. Dubner is the author of "Freakonomics" and most recently of "Think Like a Freak." 

"A basic MO that happens very frequently now is a firm will say: We need to come up with a plan or a solution. Let's get our 20 top people together in a room for an hour -- that's 20 person-hours -- and let's come up with the best one, the best idea, and then put all our resources into that and go."

What's wrong with that approach? 

The chance that this process yields the best result is almost non-existent, Dubner says. That's why he favors a more scientific problem-solving method, which involves collecting evidence until there's enough information to move forward with with an experiment.

To get an idea of how this would play out in the business world, take a look at Google. The company famously came up with the idea of "20 percent time." This initiative encouraged engineers to spend one day each week pursuing a company-related creative project. The policy reportedly spawned ideas like Gmail, Google News and even Google shuttle buses. (Google has since scaled down 20 percent time by requiring employees to seek approval on their proposed projects, however.) 

Dubner elaborated on how this kind of approach would work within an organization: 

Have a lot of ideas, most of them will be bad, but let the triage process work and let people figure out through scientific or empirical ways how they can really learn stuff. Then, once you've done some experimentation and some small-scale work, then maybe put some resources behind it.

Dubner said that this is something he'd like to see businesses do better, but that's not to say they're not already making progress.

"The digital revolution helps that so much because it's now so easy and cheap to gather data and do A/B testing or A-through-Z testing to tell you what's actually working," Dubner added.

Published on: Jan 6, 2015