Examples of the ostrich effect in practice
Posted: Sun Dec 22, 2024 10:43 am
Here are some examples of how the ostrich effect can have disastrous effects for businesses:
Ignoring market changes: A retailer that ignores online competition and insists that its traditional business model will always work, despite declining sales and a growing trend toward e-commerce.
Failing to update software: An IT manager who ignores thailand telephone number warnings about outdated software, thinking that a cyberattack "won't affect them anyway," ultimately leading to a major data breach.
Denying financial problems: A startup owner who ignores warning signs of cash flow problems and continues to invest in expansion, believing that revenues "will pick up.
Overlooking employee satisfaction: A business leader who ignores signals of dissatisfaction and low morale among staff, believing that as long as productivity is maintained, everything is fine.
Not responding to customer feedback: A company that consistently receives negative customer feedback on a product but decides to ignore it, thinking it's just "a few disgruntled customers," ultimately leading to an overall loss of reputation.
Using the ostrich effect to your advantage
Are there also ways to make the ostrich effect work for you in a positive sense? The main thing is to make sure that you yourself fall into this trap as little as possible. Very occasionally it can be beneficial:
Maintain positive illusion (fake it till you make it): At certain stages of entrepreneurship, such as the start-up phase, a certain amount of unfounded optimism can help get through a difficult time. Maintaining a positive vision, despite negative indicators, can help maintain motivation.
Stress management: Temporarily ignoring problems can sometimes be useful for stress management, especially if the business owner is unable to address the problem at that time. This can create space to focus on more immediate concerns, but it is crucial that the problems are eventually addressed.
Are you solving a complex problem for your customers? Make your product or service manageable by offering it in parts and providing extensive guidance on its application. This makes it easier for potential customers to get their heads out of the sand.
Ignoring market changes: A retailer that ignores online competition and insists that its traditional business model will always work, despite declining sales and a growing trend toward e-commerce.
Failing to update software: An IT manager who ignores thailand telephone number warnings about outdated software, thinking that a cyberattack "won't affect them anyway," ultimately leading to a major data breach.
Denying financial problems: A startup owner who ignores warning signs of cash flow problems and continues to invest in expansion, believing that revenues "will pick up.
Overlooking employee satisfaction: A business leader who ignores signals of dissatisfaction and low morale among staff, believing that as long as productivity is maintained, everything is fine.
Not responding to customer feedback: A company that consistently receives negative customer feedback on a product but decides to ignore it, thinking it's just "a few disgruntled customers," ultimately leading to an overall loss of reputation.
Using the ostrich effect to your advantage
Are there also ways to make the ostrich effect work for you in a positive sense? The main thing is to make sure that you yourself fall into this trap as little as possible. Very occasionally it can be beneficial:
Maintain positive illusion (fake it till you make it): At certain stages of entrepreneurship, such as the start-up phase, a certain amount of unfounded optimism can help get through a difficult time. Maintaining a positive vision, despite negative indicators, can help maintain motivation.
Stress management: Temporarily ignoring problems can sometimes be useful for stress management, especially if the business owner is unable to address the problem at that time. This can create space to focus on more immediate concerns, but it is crucial that the problems are eventually addressed.
Are you solving a complex problem for your customers? Make your product or service manageable by offering it in parts and providing extensive guidance on its application. This makes it easier for potential customers to get their heads out of the sand.