THE PIVOTAL BOGEY

Yesterday, the first day of the 125th US Open Golf, saw household names of the professional golfing world reduced to looking like rank amateurs by the fiendishly constructed course at the Oakmont Country Club. Day One left World Number One, Scottie Scheffler, World Number Two Rory McIlroy and defending champion Bryson De Chambeau all facing an uphill struggle to make the cut in the second round…

But it could have been worse.

At the par-five fourth hole, McIlroy managed to sink a thirty-foot putt, which one of the commentators hailed as “a great bogey,” and which a second colleague rapidly reclassified as “a pivotal bogey.”

To those unacquainted with the smallest-ball game, a ‘bogey’ is one shot more than the total number of shots pro-golfers would be ‘expected’ to need to complete any particular hole (also known as ‘par’).  A ‘double bogey’ being two shots above par, a triple-bogey three shots, and so on.

You get the idea.

And a ‘pivotal bogey’ can be a truly wonderful achievement, when, against all the odds, you manage to pull something out of the bag, stop the rot, and avoid a total for the hole that will probably see you missing the cut (and being eliminated from the tournament).  But more than that, it can trigger a complete about-face in fortunes, pluck jaws off the floors, and reinstate the kind of confidence that got you included the tournament in the first place.

To those of us engaged in The Business of Pleasure (and those poor souls engaged in less enjoyable commerce) our ‘bogies’ would probably take the form of revenue (and/or bums on seats) coming in (or sitting down) below expectations …but not as totally crap as a double or triple-bogey.

A situation that will probably seem awfully familiar to an awful lot of firms involved in The Business of Pleasure at the moment.

Maybe companies whose ‘expectations’ didn’t allow for the topsy-turvy world of Trump tariffs impacting on their forecast numbers. 

Even though these easily-predictable issues were being talked through in seminars and webinars long, long before he was elected for a second term. 

…when it wouldn’t have taken a massive leap of the imagination to join-the-dots and anticipate the effect they might have on the kind of discretionary spend which is the bread and butter (and strawberry jam) of The Business of Pleasure.

So why the shock horror when things ‘suddenly’ seem to turn to s***?

One 2018 piece of research* tried to approach this thorny (and potentially fatal) subject as follows:

‘From Pavlov's dog expecting food when hearing a bell to stereotypes as expectations about other people’s behaviour, from Bandura’s self-efficacy as expectation for success and failure of one’s own behaviour to the "predictive brain" concept in current perception theories: expectations have been a central construct in different areas of psychological research. In each of these areas, specific concepts, theoretical approaches, and empirical methods have been developed to explain when and why expectations persist and when they do not. Many theories assume that expectations (i.e., conditional predictions about future events, or “if-X-then-Y” hypotheses) are likely to change in the face of disconfirming evidence: For instance, experiencing rain on a sunny day is likely to change one’s expectation that sunshine is a valid predictor of a rainless day; experiencing helpful behaviour by another person should change a misanthropist’s expectation that other people are not trustworthy, etc. In general, “expectation violations” are defined as events that are incompatible with one’s situation-specific prediction and that should contribute to a change in expectations. However, sometimes expectations persist even though they are empirically violated. Expectation maintenance in the face of disconfirming evidence describes a phenomenon that can be observed in many different contexts: in the learning lab, the “renewal effect” shows that extinction procedures do not result in changing existing associations, but rather in learning new associations; social-psychological research on intergroup processes shows that people sometimes maintain their stereotypes about social groups even in the face of disconfirming observations; social-psychological research on person perception shows that initial information and first impressions shape one’s interactions with another person to a stronger degree than a person’s actual behaviour. Research from clinical psychology shows that depressive patients continue to be pessimistic about future events even after positive experiences. Likewise, some exposure therapies do not result in expectation change even though anxiety has decreased notably during confrontation. These examples question the general notion that expectations always change in the face of disconfirming evidence. They rather suggest that expectations can be “sticky” under certain circumstances...’

As the world’s top golfers were playing practise rounds in Pennsylvania, chancellor Rachel Reeves was leaking copiously in advance of Wednesday’s Spending Review.  More money for weapons. More money for trains. More money to train weapons. But what did Rachel really have in her sights as she bestowed what the Guardian cheekily referred to as ‘a shower of gold’ on the Nation? Aside from trying to win the undying love of Labour voters making sheep’s eyes at Reform?

From the economies of Egypt and Greece, Phoenicia and Rome, to the Reichstag in the 1930s, FDR’s New Deal, and Ronnie Reagan’s ‘Star Wars’ missile programme, governments (and their precursors, the priesthoods) have attempted to reflate stagnant economies by spending money on war-stuff and public works. But it wasn’t until 1936, and Chapter 10 of John Maynard Keynes’ General Theory of Employment, Interest and Money  that we had the comfort of a neat mathematical equation to explain how this particular money-tree grew:

‘…if the marginal propensity to consume is 90%, then 'the multiplier k is 10; and the total employment caused by (e.g.) increased public works will be ten times the employment caused by the public works themselves, k=1/S'(Y).’

What won’t be of any comfort to this particular chancellor, however, is that afore-mentioned ‘marginal propensity to consume’ is forever arm-wrestling with its evil (in this instance) twin, ‘the marginal propensity to save.’  At the risk of a monumental over-simplification, and all things being equal (which they never are outside the laboratory) if folks don’t spend, the Keynesian money-tree (and the country’s employment figures) won’t grow.**  

Great expectations?

Only time will tell if Reeves’ Spending Review will put the UK economy on course for a hole-in-one (with drinks all round) a pivotal bogey (which saves one top job) or the seemingly ever-threatening bogeyman of Stagflation.  But in terms of getting a result in The Business of Pleasure, I recall a former senior colleague, and hugely successful entrepreneur and business leader in the UK tourism sector, promising the following:

“We will never lean on you when things are going badly. Those are the times when we know you’ll be doing everything you can.  But when business is good, we’ll come down on you like a ton of bricks. Because those are the times you need to keep pedalling harder.”***

In golfing terms… every birdie (one shot below-par) you notch up, is a get-out-of-jail-free card for that next, and always-to-be-expected, bogey.

DT 13-6-25

(‘Day Two’ of US Open)

 *Psychological Responses to Violations of Expectations Mario Gollwitzer, Anna Thorwart and Karin Meissner Frontiers in Psychology Editorial, 23 Jan 2018 

**The expectations augmented Phillips Curve, Phelps and Friedman 1967 & 1968

***Another essential principle of business they passed down was: “Never buy a client or supplier cheap wine.”