Causality is a funny thing in that we make so many assumptions about what causes outcomes, when the actual cause is discovered, it’s often stunning. Anyone who read Freakonomics knows that. Of course the most stunning example was the actual cause of the incredible drop in crime in the US in the 1980s had nothing to do with law enforcement efforts and everything to do with the Roe Vs Wade Supreme court decision allowing abortions. It was a lot of the unwanted children that were growing up to become criminals, so when abortion allowed women to make the choice to not have the children they didn’t want, that wiped out an entire population of criminals. The example of the governor who learned that kids who had more books in their houses did better in school and then spent money to give five books to every household that had kids was the one that makes you slap your forehead. Of course the books themselves were not the “cause” of the kids doing better in school, that was simple correlation, the cause, of course was better parenting and more books was one aspect of the better parenting.
I actually used that book as one of several examples of why there was a need for a book that got specifically at causality in business and thus was born Rethink.
So when I read this article by William Neuman the other day about an organization called Save the Children, at first I was a bit miffed. At one point they had been pushing for a tax on sweetened drinks as a way to curb the obesity/diabetes epidemic in this country and then after very large donations from Pepsi and Coke they miraculously backed off on the push for the soda tax. It seemed like a really obvious payoff from the two companies that would probably be hurt the most by such a tax. Were they totally abandoning their mission? Then I started thinking about causality and put myself in their shoes. They need to raise money to have a bigger impact. Coke and Pepsi gave them big checks and that helps a lot. Are drinks like soda good for kids? Nope. Are they a likely cause of why so many kids are overweight in this country. Probably. Are they the only cause of kids being overweight?
Absolutely not.
So if it’s not the only cause of these health issues, is it a smart business decision to back off when it comes to pushing for the soda tax when there’s so much upside in terms of raising money for the other aspects of the efforts of Save the Children?
Absolutely.
There is a long list of the causes of obesity (including parenting a la the above reference), so as a business decision I think it makes total sense to give up the fight for a soda tax to get more money from Coke and Pepsi so that they can focus their energies on the other causes of this problem.
Get specific about the outcome, isolate the causes of the outcome, don’t make any assumptions about who your enemies and allies are until you do that. Coke and Pepsi looked like enemies of Save the Children, but the opposite is true with some clear thinking.
-Ric
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