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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 )

The Nuremberg Reckoning: When a Court of Victors Became the Conscience of Nations

Eighty years on, the Nuremberg trials, for all its imperfections, remain the world’s most audacious attempt to tame barbarism with law.

Robert Jackson at Nuremberg
Robert Jackson at Nuremberg
Judgement at Nuremberg (1961 film)
Judgement at Nuremberg (1961 film)

Courtroom 600 of the Palace of Justice in Nuremberg today has long been stripped of its wartime drama. The dock is empty; the headphones used for simultaneous translation - then a remarkable innovation - are now museum pieces. Yet, eighty years on, the ghosts of Courtroom 600 still stir. The tribunal that once sat in judgement of the horrific crimes committed by Adolf Hitler’s Nazi regime still exerts a gravitational pull on the world’s conscience.


The Nuremberg trials, which commenced in a city ravaged by Allied bombing on November 20, 1945, were many things at once. They were a moral reckoning, a geopolitical convenience, a legal experiment and ultimately a benchmark against which modern atrocities across the globe are measured. Their relevance has rarely felt sharper than today, as 21st century nation states again test the tensile strength of international law and the idea of individual accountability for mass crimes.


The origins of Nuremberg were as tangled as the ruins of the city itself. After the war, there was no obvious script for what to do with the Nazi leadership. Public opinion in Allied capitals was divided between those who sought swift executions and those who believed that the horrors of the Third Reich demanded a judicial response. Winston Churchill preferred summary justice; The wily Joseph Stalin’s preferences varied - at times he flirted with show trials, at others with mass reprisals. But it was the Americans who pushed most vigorously for a courtroom, chiefly through the efforts of Robert H. Jackson, a formidable associate justice of the U.S. Supreme Court.


Jackson was a lawyer of rhetorical fire and unyielding faith in the civilising power of law. He envisioned a trial that would not only punish the guilty but expose to the world the machinery of Nazi criminality. Britain’s representative, Hartley Shawcross, and his politically adept deputy, Sir David Maxwell Fyfe, brought to the table a blend of legalism and pragmatism, steering the proceedings through ideological shoals. The French and Soviets, each arriving with their own scars and agendas, gave the tribunal a multicultural veneer, though not always a harmonious one.

Defendants in the dock at the Nuremberg Trials
Defendants in the dock at the Nuremberg Trials

The defendants were a grotesque parade of modernity twisted. Hermann Göring, the bombastic former Reichsmarschall who relished verbal duels with the prosecutors and who would dominate the proceedings on some days; Joachim von Ribbentrop, Hitler’s foreign minister, stiff and charmless; Rudolf Hess, Hitler’s one-time Deputy; Albert Speer, the urbane technocrat whose contrition was as plausible as it was self-serving.


Göring treated the trial as an encore performance. He strutted, preened, and parried with the prosecutors. Early on, he sought to turn Nuremberg into a referendum on Allied hypocrisy. At one point he declared, in various formulations, that “the victor will always be the judge”—a line that would echo through decades of criticism. Jackson’s cross-examination dismantled much of Göring’s theatrical bravado, but the Reichsmarschall’s calculated swagger shaped early perceptions of the trial: was this justice, or victors’ justice?


But this critique of the trials was also echoed by intellectuals, legal scholars and even some Allied officials who argued that the tribunal represented ‘victors’ justice.’ The legal foundations of some charges, most notably “crimes against peace,” were worryingly ex post facto.


The Soviet role in the prosecution raised its own inconsistencies as the USSR was both judge and perpetrator of acts not unlike those being tried, from the secret police massacres to the invasion of Poland and the decimation of Polish intelligentsia at Katyn. Telford Taylor, Jackson’s junior colleague and one of the tribunal’s most perceptive chroniclers, later wrote that the trial “necessarily sacrificed pure theory of law in favour of pragmatic justice.”


Yet, the alternative - no trials at all - would almost certainly have been worse. As Joseph Persico observed in his popular history ‘Nuremberg: Infamy on Trial’ (1995), the Allies were acutely aware that the First World War had ended with neither accountability nor clarity. Hitler had exploited this vacuum of justice to craft a myth of betrayal and martyrdom. The Nuremberg architects feared, rightly, that another vacuum could become even more toxic.


The eventual judgment, handed down in October 1946, was a complex document which was part uncompromising condemnation, part legal innovation, part political balancing act. Twelve defendants were sentenced to death, including Göring (who cheated the gallows by swallowing cyanide hours before his execution). Others received long prison sentences; three were acquitted. More crucially, the tribunal articulated a set of principles that would echo across the second half of the twentieth century: that aggression is a crime, that commanders bear responsibility for their subordinates and that individuals, and not abstractions like ‘states’ commit atrocities.


The world into which the Nuremberg principles were released was shifting rapidly. The Cold War began in earnest before the trials had ended. The fragile unity that had enabled the Allies to sit together at a courtroom table evaporated into ideological hostility.


Superpower rivalry quickly overshadowed the pursuit of universal accountability. In Eastern Europe, Soviet-backed regimes staged their own trials. In the West, several former Nazis were quietly rehabilitated into intelligence networks or industrial posts considered vital in the struggle against communism. While Nuremberg’s lofty ideals were not abandoned, they were frequently subordinated to realpolitik.


Perhaps cinema has preserved what politics preferred to forget. This year has seen a new cinematic revival in form of James Vanderbilt’s ‘Nuremberg’ featuring Russell Crowe as Göring, whose performance reportedly captures the defendant’s mixture of menace, vanity and predatory charm.


Yet, the gold standard remains Stanley Kramer’s 1961 classic ‘Judgment at Nuremberg.’ While it doesn’t focus on the trials of the top Nazis, it is a film of such moral and artistic force that it deserves mandatory viewing in any democracy. The film, bolstered by heavyweight performances all around - Spencer Tracy’s quiet moral gravity as Judge Haywood, Maximilian Schell’s Oscar-winning, dazzlingly persuasive defence counsel, Burt Lancaster’s simmering guilt as an indicted jurist, Montgomery Clift’s raw fragility and Judy Garland’s heartbreaking testimony – makes mesmerizing viewing. It distils the ethical labyrinth of Nuremberg into unforgettable dialogue.


Its most searing lesson is not that evil triumphs, but that it is often enabled by respectable men in black robes.


The trial’s literary afterlives are equally rich. Telford Taylor’s ‘The Anatomy of the Nuremberg Trials’ (1992) remains the definitive insider’s account, blending legal analysis with rueful awareness of the tribunal’s contradictions. Ann and John Tusa produced a lucid narrative reconstruction of the courtroom’s daily dramas. Gitta Sereny’s meticulous biography of Speer dissected the moral evasions of technocracy. Rebecca West, reporting for The New Yorker, captured the eerie spectacle of “broken souls masquerading as statesmen.” And although Hannah Arendt wrote about the later Eichmann trial, her notion of the “banality of evil” casts a long retrospective shadow over Nuremberg, illuminating its central quandary: how ordinary individuals commit extraordinary crimes.


These accounts remind us that Nuremberg was far more than a legal proceeding; it was also a seminal literary moment – an attempt to describe the collapse of moral order. The effort to narrate atrocity is in itself a form of justice.


Eight decades later, the world looks disturbingly familiar. Russia’s war in Ukraine, atrocities in Sudan, the devastation in Gaza, and the return of major-power rivalry have revived old debates. Can leaders be held accountable? Who decides what constitutes a war crime? Are international institutions hopelessly politicised or are they essential bulwarks against a return to barbarism? The International Criminal Court, controversial since its birth, is simultaneously invoked and ignored by states depending on circumstance – an eerie echo of the selective moralism that dogged Nuremberg’s own aftermath.


Nuremberg’s relevance today lies in the recognition that justice is always contested, always incomplete and always vulnerable to power politics. The pursuit of perfect legality is illusory, yet the abandonment of legal constraint is far worse. Nuremberg’s chief achievement was not its verdicts, but its insistence that atrocities must not be met with silence or vengeance alone.

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