A Brand’s Survival in One Lesson: What You See and What You Don’t See
The profound wisdom encapsulated in Henry Hazlitt’s timeless book, Economics in One Lesson, holds the very key to a brand’s survival and enduring success. It can be summarised in one powerful statement, rooted in Frédéric Bastiat’s earlier essay, “Ce qu’on voit et ce qu’on ne voit pas” (What We See and What We Don’t See):
“THE ART OF ECONOMICS CONSISTS IN LOOKING NOT MERELY AT THE IMMEDIATE BUT AT THE LONGER EFFECTS OF ANY ACT OR POLICY; IT CONSISTS IN TRACING THE CONSEQUENCES OF THAT POLICY NOT MERELY FOR ONE GROUP BUT FOR ALL GROUPS.”
This principle is as relevant today as it was when first published in 1946. It speaks to the insidious nature of the “broken window fallacy,” showing how a seemingly beneficial action—be it a cost efficiency drive, a product launch, a manufacturing tweak, or a marketing strategy—when traced to its law of unintended consequences, can powerfully hinder a brand’s full performance in ways that are unseen or actively ignored.
The fallacy often operates under the Streetlight Effect: we focus intently on the immediate, visible benefits of one part of a brand, believing that it benefits the whole in isolation. Unfortunately, time and again, this is proven false. The unseen losses and the adverse ripple effects on other crucial “groups” (customer segments, other product lines, brand trust) are the true broken windows. Nine-tenths of brand fallacies silently and inadvertently lead to growth impairment precisely because Hazlitt’s one lesson is overlooked. The very fabric of a brand’s long-term health can be slowly undermined by its own economic dogmas. This is the essence of an Opaque Black Box operating within.
Consider the unsettling paradox of success experienced by one of my clients: a team celebrated a seemingly brilliant policy to reformulate a key ingredient in one of their bestselling products. This strategic shift successfully reduced transportation costs by a significant €42 million annually—a stunning, merited success for that group of stakeholders.
However, less than a year into trading with this “optimised” transformation, a diagnostic assessment akin to an Organisational CT Scan conducted with the client in 2020 revealed a different, devastating truth. That single, seemingly successful policy had inadvertently resulted in a staggering €1.74 billion annual loss in group retail sales. The reformulated product, while cheaper to transport, was found to be 70% less efficient in its actual use by the customer, a fundamental breach of trust that led to a significant decline in overall customer satisfaction and emotional connection. What had been a celebrated internal win ultimately led to a catastrophic decline in market performance, with our diagnostic able to trace a €840 million year-over-year revenue decline directly back to this ill-considered change.
Experience consistently shows that all organisations maintain and uphold strong dogmatic fallacies, often in their pursuit of what they believe to be efficiency or growth. My teachings are clear: don’t let beliefs go unchallenged, and be the guide to your brand’s survival. The courage to look beyond the immediate, to trace the full consequences, and to challenge accepted truths is the only path to sustainable value.
