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By:

Rashmi Kulkarni

23 March 2025 at 2:58:52 pm

Loss Aversion Is Why Your Good Idea Fails

Your upgrade is their loss until you prove otherwise. Last week, Rahul wrote about a simple truth: you’re not inheriting a business, you’re inheriting an equilibrium. This week, I want to talk about the most common reason that equilibrium fights back even when your idea is genuinely sensible. Here it is, in plain language: People don’t oppose improvement. They oppose loss disguised as improvement. When you step into a legacy MSME, most things are still manual, informal, relationship-driven....

Loss Aversion Is Why Your Good Idea Fails

Your upgrade is their loss until you prove otherwise. Last week, Rahul wrote about a simple truth: you’re not inheriting a business, you’re inheriting an equilibrium. This week, I want to talk about the most common reason that equilibrium fights back even when your idea is genuinely sensible. Here it is, in plain language: People don’t oppose improvement. They oppose loss disguised as improvement. When you step into a legacy MSME, most things are still manual, informal, relationship-driven. People have built their own ways of keeping work moving. It’s not perfect, but it’s familiar. When you introduce a new system, a new rule, a new “professional way,” you may be adding order but you’re also removing something  they were using to survive. And humans react more strongly to removals than additions. Behavioral economists Daniel Kahneman and Amos Tversky called this loss aversion where we feel losses more sharply than we feel gains. That’s why your promised “future benefit” struggles to compete with someone’s immediate fear. Which seat are you stepping into? Inherited seat:  People assume you’ll change things quickly to “prove yourself”. They brace for loss even before you speak. Hired seat:  People watch for hidden agendas: “New boss means new rules, new blame.” They protect themselves. Promoted seat:  Your peers worry the old friendship is now replaced by authority. They fear loss of comfort and access. Different seats, same emotion underneath: don’t take away what keeps me safe. Weighing Scale Think of an old kirana shop. The weighing scale may not be fancy, but it’s trusted. The shopkeeper has used it for years. Customers have seen it. Everyone has settled into that comfort. Now imagine someone walks in and says, “We’re upgrading your weighing scale. This is digital. More accurate. More modern.” Sounds good, right? But what does the shopkeeper hear ? “My customers might think the old scale was wrong.” (loss of trust) “I won’t be able to adjust for small realities.” (loss of flexibility) “If the digital scale shows something different, I’ll be accused.” (loss of safety) “This was my shop. Now someone else is deciding.” (loss of control) So even if the new scale is better, the shopkeeper will resist or accept it politely and quietly return to the old one when nobody is watching. That is exactly what happens in companies. Modernisation Pitch Most leaders pitch change like this: “We’ll become world-class.” “We’ll digitize.” “We’ll improve visibility.” “We’ll build a process-driven culture.” But for the listener, these are not benefits. These are threats, because they translate into losses: Visibility can mean exposure . Process can mean loss of discretion . Digitization can mean loss of speed  (at least initially). “Professional” can mean loss of status  for the old guard. So the person across the table is not debating your logic. They’re calculating their losses. Practical Way Watch what happens when you propose something simple like daily reporting. You say: “It’s just 10 minutes. Basic discipline.” They hear: “Daily reporting means daily scrutiny.” “If numbers dip, I will be questioned.” “If I show the truth, it will create conflict.” “If I don’t show the truth, I’ll be accused later.” In their mind, the safest response is: nod, agree, delay. Then you label them “resistant.” But they’re not resisting change. They’re resisting loss . Leader’s Job If you want adoption in an MSME, don’t sell modernization as “upgrade”. Sell it as protection . Instead of: “We need an ERP.” Try: “We need to stop money leakage and order confusion.” Instead of: “We need systems.” Try: “We need fewer customer escalations and less rework.” Instead of: “We need transparency.” Try: “We need fewer surprises at month-end.” This is not manipulation. This is translation. You’re speaking the language the system understands: risk, leakage, blame, customer loss, cash loss, fatigue. Field Test: Rewrite your pitch in loss-prevention language Pick one change you’re pushing this month. Now write two versions: Version A (your current pitch): What you normally say: upgrade, modern, efficiency, best practices. Version B (loss prevention pitch): Use this template: What are we losing today?  (money, time, customers, reputation, peace) Where is the leakage happening?  (handoffs, approvals, rework, vendor delays) What small protection will this change create? (fewer disputes, faster closure, less follow-up) What will not change?  (no layoffs, no humiliation, no sudden policing) What proof will we show in 2 weeks?  (one metric, one visible win) Now do one more important step: For your top 3 stakeholders, write the one loss they think they will face  if your change happens. Don’t argue with it. Just name it. Because once you name the fear, you can design around it. The close If you remember only one thing from this week, remember this: A “good idea” is not enough in a legacy MSME. People need to feel safe adopting it. You don’t have to dilute your standards. You just have to stop selling change like a TED talk and start selling it like a protection plan. Next week, we’ll deal with another invisible force that keeps companies stuck even when they agree with you: the status quo isn’t a baseline. It’s a competitor. (The writer is CEO of PPS Consulting, can be reached at rashmi@ppsconsulting.biz )

How Is ISIS Influencing Terrorism?

ISIS Influencing

At 3:15 am on New Year's Day, a 42-year-old US citizen and army veteran from Texas called Shamsud-Din Jabbar drove a rented pickup truck into a crowd on Bourbon Street in New Orleans, killing 15 people and injuring at least 35 more.


The Federal Bureau of Investigation (FBI) called the attack an “act of terrorism” and said that Jabbar appeared to have been motivated by the Islamic State (IS) terrorist organisation. The group's infamous black flag was recovered from the back of his vehicle, and he had posted videos online proclaiming his support for IS.


We do not know whether Jabbar, who was fatally shot by police, was a genuine IS operative. But the style of his attack was consistent with those committed on behalf of the group in the past. Vehicles were used to target civilians in the 2017 attack on London's Westminster Bridge, as well as in Berlin and the French city of Nice in 2016.


Jabbar's attack demonstrates the resilience of IS despite its lack of territorial control, as well as its commitment to inspire lone-wolf attacks in an attempt to gain widespread coverage.


IS gained global attention in 2014 when it captured large parts of Iraq and Syria and established a so-called Islamic caliphate. Between 2014 and 2016, when the group was at the height of its powers, IS spread fear worldwide and managed to recruit thousands of men and women from nearly 80 countries.


Ten organisations classified as “IS affiliates” by the US National Counterterrorism Centre committed more than 1,000 attacks combined during this period.


By 2019, IS had lost all of its territory due to the efforts of a US-led military coalition, alongside Kurdish and Iraqi forces. However, the group had already begun preparing for a new structure.


The group transitioned towards a more clandestine network of decentralised cells, and takes advantage of unstable states primarily in sub-Saharan Africa to facilitate the movement of weapons, equipment and fighters.


IS has continued to focus on the mobilisation and online recruitment of men and women to sustain its operations, too. This is done almost entirely through the dissemination of information and propaganda online. The result has been several high-profile attacks by recruits of the group and its affiliates over the past few years, including on Moscow's Crocus City Hall concert venue in March 2024, which resulted in the deaths of 145 people.


Intelligence agencies have foiled many more. In August, for example, three Taylor Swift concerts in Vienna, Austria, were cancelled after the authorities arrested two people who were allegedly planning an attack. The suspects had been radicalised by extremist Islamist propaganda from IS and Al-Qaida.


Challenges moving forward

Jabbar's attack demonstrated an ability to keep up with technological developments. Security camera footage shows Jabbar cycling through the Bourbon Street area a few months before the attack while filming on Meta smart glasses to record a video. This enabled Jabbar to become familiar with the area and assess its security measures.


On the day of the attack itself, Jabbar also drove an electric truck. This enabled him to cause as many casualities as possible as electric vehicles can accelerate faster than their gas-powered counterparts. The use of emerging technologies by terrorists clearly presents a significant challenge for law enforcement and intelligence officials moving forward.


Another important point to consider is Jabbar's background in the US military. The involvement of military personnel in far-right extremism and terrorism has become an increasing concern over recent years. Research has found that the proportion of terrorist attacks in the US involving people with a military background jumped from 0.8% in 2018 to 6.4% in 2020.


The attack on the US Capitol Building on January 6, 2021 brought the issue of extremism within the armed forces firmly into the spotlight. A former air force officer called Larry Brock was sentenced to two years in prison in 2023 for his role in the riots. Of the 400 people who have been sentenced for their role in the attack, at least 70 had served in the military.


Similarly, in 2022, a German soldier named Franco Albrecht was found guilty of plotting to carry out attacks on senior politicians and anti-racist activists while posing as a Syrian refugee, hoping the blame would be placed on migrants. Albrecht's case triggered an attempt to seek out more far-right networks in the German military.


At the time of writing, there is not much information about how Jabbar himself became radicalised. But there is enough evidence to suggest that radicalisation is not a linear process and differs from one person to another. It could happen to anyone and individuals may not even realise the process they have gone through.


Causes of radicalisation vary. They are not limited to people with certain types of vulnerabilities or grievances, and cannot be attributed to people with mental health issues. This is simply because not everyone experiencing mental health problems or grievances will resort to violence to address their problems.


The FBI continues to gather information about the motive behind the attack and Jabbar's potential affiliations with terrorist groups. But the findings related to the technology he used and his military background of highlight the challenge states face moving forward in their efforts to combat and eliminate the threat posed by terrorism.

-The Conversation

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