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“Speak as you might to a young child. Or a golden retriever.”

To mitigate, or not to mitigate, that is the question

If you haven’t yet watched Margin Call, I would urge you to do so. The film depicts 24 hours in the life of an Investment Bank (a thinly-disguised Lehman Brothers) on the brink of collapse.

An analyst called Peter Sullivan (played by Zachary Quinto) has just run a statistical model predicting that the company is likely to fail in a matter of hours. A 3am board meeting has been hastily arranged, the company Chairman (John Tuld, played by Jeremy Irons) has flown in by helicopter, and the following exchange then takes place:


I’d like to speak with the analyst who seems to have stumbled across this mess.


Certainly. That would be Peter Sullivan, right here.


Oh! Mr Sullivan! You’re here! Good morning! Maybe you could tell me what you think is going on here. And—please—speak as you might to a young child. Or a golden retriever. It wasn’t brains that got me here, I can assure you of that!


Well, sir, as you may or may not know, I work here for Mr Rogers as an associate in the Risk Assessment and Management office at MBS…


Please. Just relax, stand up, and tell us in a clear voice what is the nature of the problem.


Okay. Well, as you probably know, over the last 36-40 months the firm has begun packaging new MBS products that combine several different tranches of rating classification in one tradable security. This has been enormously profitable, as I imagine you noticed…

And so it goes on. But, me being me, as I was watching this scene, I was struck by the parallels with exchanges that take place in NHS boardrooms (though not, in my experience, at 3am). A relatively junior analyst is being asked to explain something complicated to a group of distracted big cheeses. He is nervous. He begins hesitantly. He is reminded to speak in words of no more than one syllable.

Let’s explore the problems associated with rank and deference when lowly number-crunchers are asked to explain numbers to boardroom executives.

The first thing to observe about that boardroom scene in Margin Call is the brutal honesty employed by Tuld when he says to the analyst: “Speak as you might to a young child. Or a golden retriever.” Number-crunchers tend to overestimate the time and attention that senior managers can devote to looking at data. Senior managers are not—usually—“detail people”. In fact, not only that, but it’s often the case (and I hope I’m not speaking out of turn here) that they are actually pretty hopeless with numbers (“It’s not brains that got me here, I can assure you of that”). But anyway – regardless of whether they are numerate or not (and some of them have Maths degrees but that’s not going to help them a great deal if they are pressed for time), we have to recognise and understand that when we are communicating with important, busy, stressed-out people we have to adapt the way we speak and write.

In Malcolm Gladwell’s 2008 book Outliers there’s an essay called ‘The Ethnicity Theory of Plane Crashes’. Again, I urge you to read it. And the other pieces in the book, too: they’re all good. Gladwell tells us that Korean Airlines had a very poor safety record during the late 1990s (its "loss rate" was 4.79 aircraft per million departures, compared with America's United Airlines loss rate of 0.27 aircraft per million departures). And the theory that seemed to explain this failure most cogently was an explanation to do with flight deck communication. Specifically, the effectiveness of the verbal communication between captains and first officers on the flight deck. Investigations of Korean Airlines crashes had led people to believe that first officers were being too deferential towards their captains when they were communicating vital information to them. And in situations when the captains were already stressed (they might already be dealing withfor examplepoor weather, a landing at an unfamiliar airport, sick passengers on board, unscheduled delays, and so on) the messagesdespite their overwhelming importance and urgencyjust weren’t getting through. And they weren’t getting through because of the way they were being phrased and spoken.

Gladwell explains that ethnicity can be a powerful determinant of how clearly we communicate with our superiors. Different countries and cultures score differently on what the Dutch psychologist Geert Hofstede calls the “Power Distance Index”. Power distance is, as Gladwell explains it, “concerned with attitudes toward hierarchy, specifically with how much a particular culture values and respects authority.” Latin and Asian countries that value and respect authority score high; German and Scandinavian countries that don’t give a hoot, they score low.

When people perceive themselves as being of lower social status than the person they are talking to, they will communicate using lots of mitigation. And one of the delights of Gladwell’s article (at least, from an analyst’s point of view) is that it turns out you can actually measure how mitigated your speech is - on a 1-7 scale from a "hint" (most mitigated), through "preference", "query", "crew suggestion", "crew obligation statement" to "command" (where there is zero mitigation).

When Korean Airlines addressed their communication issues (for example, they made it compulsory to speak English on the flight deck at all times, and they recruited a Western firm to carry out all the training and instruction of pilots), they turned things around. Between 1999 and 2008 (when Gladwell wrote his article) Korean Airlines had an unblemished air safety record.

When you listen to what Peter Sullivan says (and—perhaps more importantly—when you watch how he says it, which is why you need to get the DVD) in that boardroom scene in Margin Call, you realise when he begins to speak that that there’s a lot of deference and mitigation going on. He uses the word “Sir” a lot (although—admittedly— that’s something that Americans do a lot more than we Brits so maybe there’s not a lot to read into there), and there’s an awful lot of hesitancy in his voice.

But as he gains in confidence, the mitigation decreases. And his explanations get more direct. The chairman, John Tulde, helps this process along by "translating" Sullivan’s tentative explanation into something much more direct:


So. What you’re telling me is that the music is about to stop and we’re going to be left holding the biggest bag of odorous excrement ever assembled in the history of capitalism..?

…which then gives Sullivan the self-assurance to answer back:


Sir, I’m not sure that I would put it that way. Let me clarify. Using your analogy, what this model shows is the music—so to speak—just slowing. If the music were to stop, as you put it, then this model wouldn’t be even close to that scenario. It would be considerably worse.

Which is a lot closer to the command level on the mitigation spectrum.

So, on those rare occasions when we humble analysts, we lowly number-crunchers are allowed to breathe the hallowed and rarefied air around the boardroom table, and we’re asked to say something about our datawhat should we do? Should we dress it up in mitigated speech? “Well, Sir, as you can see, the table on page 3 suggests that last month there may possibly have been the merest hint of a slight upward movement in the number of patients waiting longer than four hours in the Emergency Department.” In which case, the message probably won't get through.

Or should we speak as to a child (or a golden retriever): “Last month it was 98%. This month it’s 95%. That’s the worst month-on-month deterioration in A&E waiting-time performance since records began.”


[30 November 2012]


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