hanlons-razor

What Is The Hanlon’s Razor And Why It Matters In Business

Hanlon’s razor is an adage, often quoted as such:

               “Never attribute to malice that which is adequately explained by stupidity.”

In other words, there is a tendency for individuals or businesses to assume malice when that malice is in fact stupidity.

Understanding Hanlon’s razor

Variations of Hanlon’s razor go back as far as German writer Johann Wolfgang von Goethe, who equated malice and stupidity with incompetence. However, the adage was named after Robert J. Hanlon, who submitted the quote for inclusion in a joke book. 

In the modern context, Hanlon’s razor is a somewhat philosophical concept. Indeed, the principle of a razor in philosophy is one that allows the individual to eliminate or “shave off” unlikely explanations for a particular phenomenon. 

When Hanlon’s razor is not taken into account, the individual or business who has a bad experience assumes that the world is against them. That the world or the individuals it consists of are malicious and intent on doing them harm. 

Instead, Hanlon’s razor advocates that problems and bad experiences are part of life. In the vast majority of instances, there is no malice behind them.

In marketing and business relationships, Hanlon’s razor is one of a suite of mental models that govern specific thought processes attached to examining a problem.

Examples of Hanlon’s razor in business

British Airways

When British Airways experienced an IT shutdown in 2017 that affected 75,000 passengers, consumers widely assumed that the airline was acting against them. 

Theories ranged from budget cuts to the outsourcing of work to India, or a combination of both. However, the shutdown was later determined to have been caused by a simple power malfunction.

Apple

There is a widespread belief that Apple tries to force people to upgrade to the latest iPhone by slowing the performance of older models. 

Yet Apple revealed that the slower performance was due to an update that decreased the load on older batteries and thus their tendency to cause these older model smartphones to crash.

The benefits of Hanlon’s razor thinking

  • Improved relationships. Say for example that a potential joint venture partner does not return a business’s calls. The business could assume the worst and conclude that the other party is acting maliciously toward them – souring the relationship in the process. Alternatively, the business who practices patience may receive a phone call in a few days explaining that a family member was taken ill and that the partner was still looking forward to a joint venture in the future.  
  • Better resource allocation. Instead of spending time and money planning for the worst-case scenario, businesses can divert resources to the less malicious (though far more likely) cause of a bad experience. This encourages fact-based decision making, which investor Charlie Munger advocates as essential to dismantling and then solving business problems that can often be governed by emotion.

Key takeaways:

  • Hanlon’s razor argues that in most cases, it is better to assume that a negative event occurred because of stupidity or incompetence rather than malice.
  • Hanlon’s razor is one of several mental models of thinking that businesses can use. It advocates a fact-based decision making response to internal or external negative events.
  • The benefits of Hanlon’s razor include better relationships with key stakeholders and smarter problem-solving resource allocation.

Other strategy frameworks:

Additional resources:

Published by

Gennaro Cuofano

Gennaro is the creator of FourWeekMBA which target is to reach over two million business students, executives, and aspiring entrepreneurs in 2020 alone | He is also Head of Business Development for a high-tech startup, which he helped grow at double-digit rate | Gennaro earned an International MBA with emphasis on Corporate Finance and Business Strategy | Visit The FourWeekMBA BizSchool | Or Get in touch with Gennaro here