First, Try Not To Fool Yourself, Because You are The Easiest One To Fool

I recently read a book by a well-known business thought leader that I have tremendous respect for. Surprisingly, I noticed a factual error and, when I checked her notes, I saw that she cited an article I wrote in Forbes in which I made the same factual error. So it is quite likely that she made the mistake because she put her trust in me.

The error was relatively minor. I wrote that Blockbuster CEO, John Antioco, was fired because of a compensation dispute, when actually he left of his own accord. It was a stupid mistake and, to this day, I’m not really sure of why I made it. But I did so numerous times, in a number of articles and didn’t correct myself until Antioco himself set me straight.

The error wasn’t due to a lack of information. In fact, on some level I knew the real story, but somehow I got the wrong one into my head and it stuck there. The truth is that our minds are incredibly adept at playing tricks on us. Getting facts right has nothing to do with intelligence or ability. We need to recognize how easy it is to fool ourselves and remain vigilant.

The Availability Bias

The story about Antioco carries a lot of baggage. Blockbuster was the 800-pound gorilla of the video rental industry that got upended by Netflix. So many use it as a prime example of how incumbent businesses fail to see warning signs until it’s too late. For two decades, the former video giant has been a poster child for inept management.

The truth, however, couldn’t be more different, which is why I wrote the article. First, it was Antioco’s innovative strategy of partnering with studios that made Blockbuster the market leader in the first place. Second, his team moved quickly to respond to the threat, built an effective strategy and began outpacing Netflix with its Total Access program when the compensation dispute erupted, prompting Antioco to resign.

Yet the Netflix team tells a much different story. There are various versions, but in a nutshell, they say they flew to Dallas to meet with Antioco, offered him the deal of the century and got laughed out of the room. They vowed then and there to beat the corporate behemoth and rededicated themselves to making Netflix succeed.

That story doesn’t hold up for a number of reasons. First, Blockbuster was owned by Viacom at the time and couldn’t have made a major acquisition by itself. Second, Antioco wasn’t at the meeting (although he told me he might have stopped by briefly). Third, the deal they offered Blockbuster was a lousy one. Finally, by all accounts—and my own limited experience—it would have been out of character for Antioco to be disrespectful.

Nevertheless, Netflix has been incredibly successful and its “David vs Goliath” account has a certain narrative appeal, so that’s what gets repeated and I’m sure it shaped my perception and affected my judgment. My guess is that it cast negative sheen on Antioco’s departure from Blockbuster and led me to view it in a more negative light.

Wading Through Competing Narratives

I think everyone agrees that getting the facts right is important, but that’s easier said than done. For any given event, people often have differing versions of what happened. That’s especially true of the Netflix-Blockbuster story. Each participant has different recollections of the same event and you can’t take anyone’s at face value.

Here’s what we know: In 2000, with Netflix struggling to stay afloat, co-founders Marc Randolph and Reed Hastings traveled to Dallas in hopes of striking a deal that could save their company. Their pitch was rejected and they flew back to California humiliated. Once home, they made changes that saved the company and built a legendary success story.

Yet many details remain unclear. For instance, the Netflix founders distinctly recall meeting with Antioco, while he claims he only stopped by briefly. Antioco remembers the pitch being about a partnership, but not a buyout. According to Randolph, Blockbuster says he dismissed the “dot-com hysteria” as overblown, though Antioco says he intended to create his own online service at some point.

There are also discrepancies between Randolph and Hastings. Randolph claims they were “laughed out of the room,” while Hastings would later write that “That night, when I got into bed and closed my eyes, I had this image of all sixty thousand Blockbuster employees erupting in laughter at the ridiculousness of our proposal.”

For my part, I came to the story with my own biases. I was interested in the story for my book, Cascades, which I was working on. For my purposes, the value of the story was to show that having the right idea isn’t enough. You have to overcome resistance. So the idea that Antioco came up with an effective strategy and then was fired fit my narrative quite nicely.

Also, to be fair to myself Antioco’s account in Harvard Business Review, where I first came across the unpopular version of the story, was somewhat vague on the subject of whether he was fired or not).

Putting The Pieces Together

I have been writing about this Blockbuster-Netflix story for over a decade, have read the memoirs of Reed Hastings and Marc Randolph, as well as Gina Keating’s excellent book, Netflixed, which gives a neutral account based on her contemporary reporting for Reuters. I also interviewed both John Antioco and his successor, Jim Keyes.

Here’s what I think really happened. When Hastings and Randolph flew down to Dallas, they were in bad shape. Their business was failing and, as best as I can tell, they hadn’t yet come up with the subscription-based business model that propelled them to success. When Blockbuster rejected their proposal, it must have been devastating.

From Blockbuster’s point of view, they probably made the right move. Antioco wasn’t at the meeting and can’t know for sure everything that was said, but then again, Netflix didn’t have much to offer. Blockbuster could build a web business for far less than $50 million and, if it had paid that money to Hastings and Randolph, they would have surely moved on and would likely not have built the model that made Netflix so successful.

From the Netflix point of view, the humiliation they felt must have been very real, as was their determination to show up the executives at Blockbuster. Their version also had a certain romantic quality which people find attractive. It’s easy to see Antioco and Blockbuster as big, dumb and slow.

For my part, those negative connotations—and with my own preferred narrative—likely influenced my perspective. When Antioco wrote in his HBR piece that he and Carl Icahn had “finally agreed that I’d leave the company in July 2007,” I assumed he was euphemistically referring to being fired, when he was really just being demure about a difficult conversation.

Working To Get it Right

It would be nice if everyone could have the experience of writing a book and having it thoroughly fact checked. In each of my books, I had dozens of errors in the original manuscript. Many of the them were corrected by my publisher’s fact checkers looking online for reference materials to verify what I had written.

But they can only do so much, which is I also sent sections of my work to primary sources for verification. Even then at least one minor error got through on my first book (a publicist for a source didn’t catch it when I sent the section). That’s how I caught my error about Blockbuster CEO John Antioco and was able to fix it. He was also generous enough to offer additional insight and write a blurb for my book.

Yet that doesn’t change the fact that I repeated the error in multiple articles, even though I had read the accurate version in Gina Keating’s book. My version was then picked up by others and repeated in their work. As the great physicist Richard Feynman famously said “The first principle is that you must not fool yourself—and you are the easiest person to fool. So you have to be very careful about that.”

We need to be disciplined about what we think we know. The first step is to be hyper-vigilant and aware that our brains have a tendency to fool us. We will quickly grasp on the most readily available information and detect patterns that may or may not be there. Then we seek out other evidence that confirms those initial hunches while disregarding contrary evidence.

It happens to the best of us and, if you are going to put work out in the world you are going to have to accept the risk of getting things wrong. Once you embrace that, you have a chance to make a positive impact on the world.

Greg Satell is Co-Founder of ChangeOS, a transformation & change advisory, an international keynote speaker, host of the Changemaker Mindset podcast, bestselling author of Cascades: How to Create a Movement that Drives Transformational Change and Mapping Innovation, as well as over 50 articles in Harvard Business Review. You can learn more about Greg on his website, GregSatell.com, follow him on Twitter @DigitalTonto, his YouTube Channel and connect on LinkedIn.