Why Hypotheses Beat Goals

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Not long ago, it became fashionable to embrace failure as a sign of a company’s willingness to take risks.  This trend lost favor as executives recognized that what they wanted was learning, not necessarily failure.  Every failure can be attributed to a raft of missteps, and many failures do not automatically contribute to future success.

Certainly, if companies want to aggressively pursue learning, they must accept that failures will happen.  But the practice of simply setting goals and then being nonchalant if they fail is inadequate.

Instead, companies should focus organizational energy on hypothesis generation and testing.  Hypotheses force individuals to articulate in advance why they believe a given course of action will succeed.  As researcher Jeanne Ross explains in the Summer 2019 MIT Sloan Management Review, failure then exposes an incorrect hypothesis — which can more reliably convert into organizational thinking.

What Exactly Is a Hypothesis?

When Ross’ son was in the second grade, his teacher regularly introduced topics by asking students to state some initial assumptions.  For example, she introduced a unit on whales by asking:  How big is a blue whale?  The students all knew blue whales were big, but how big? Guesses ranged from the size of the classroom to the size of two elephants to the length of all the students in class lined up in a row.  Students then set out to measure the classroom and the length of the row they formed, and they looked up the size of an elephant.  They compared their results with the measurements of the whale and learned how close their estimates were.

Note that in this example, there is much more going on than just learning the size of a whale.  Students were learning to recognize assumptions, make intelligent guesses based on those assumptions, determine how to test the accuracy of their guesses, and then assess the results.

This is the essence of hypothesis generation.  A hypothesis emerges from a set of underlying assumptions.  It is an articulation of how those assumptions are expected to play out in a given context.  In short, a hypothesis is an intelligent, articulated guess that is the basis for taking action and assessing...

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