MIIC Nov 5, 2010 Prof. Morten Hansen Managing Decision-Making Processes: Debate and Buy-in (Dec Making Exercise) MIIC Nov 5, 2010 Prof. Morten Hansen

Three ways of designing conflict into the decision making process Consensus: Debate one solution Strive for unanimity and harmony Devil’s advocacy: First sub-group develops a solution Second sub-group criticizes the developed solution First sub-groups modifies solution in response to criticism Dialectical inquiry: Second sub-group develops an alternative solution The two sub-groups come together and develop a joint solution

Decision Process Comparison CONSENSUS Benefits Downsides Most managers use this method regularly and feel somewhat comfortable with it Entails lower opportunity costs for participants: time, experience, training Generates greater group harmony which may have a beneficial impact on implementation and other future group interaction May be more appropriate for structured and/or routine tasks with sufficient data and clear alternatives Does not uncover as many new alternatives, assumptions, and perspectives; less innovation May lead to premature agreement or convergence on a single alternative Sometimes leads to the suppression of dissent, especially as a majority opinion emerges. Risk of groupthink. Generates lower levels of critical evaluation

Decision Process Comparison DIALECTICAL INQUIRY / DEVIL’S ADVOCACY Benefits Downsides Generates multiple alternatives; more innovative ideas Explicitly outlines the supporting argument for a particular alternative (assumptions, facts) Leads to considerable critical evaluation. Avoids early convergence on single alternative Fosters a high level of individual understanding of the final decision Does not force individuals to stand alone as dissenters/critical evaluators May be quite appropriate for ill-structured tasks May adversely impact group harmony, decision acceptance, and implementation Entails opportunity costs for participants: time, experience, training Subgroups may generate “safe” alternatives knowing that others will closely scrutinize their proposals DI: synthesis of opposing alternatives may lead to mediocre compromise DA: process may focus too much on destroying a particular alternative, rather than constructing other viable courses of action

Decision making process design leads to two types of conflict Cognitive Conflict: Generally task oriented and focused on judgmental differences about how to best achieve common objectives Affective Conflict: Tends to be emotional and focused on personal incompatibilities or disputes Source: Amason, “Distinguishing the Effects of Functional and Dysfunctional Conflict”

Two types of conflict assessed in decision making exercise Assessing the Level of Conflict: Cognitive: 3. How many disagreements over different ideas about this decision were there? 4. How many differences about the content of this decision did the group have to work through? Affective: 5. How much personal friction surfaced within the group during the decision making process? 6. How many personality clashes became evident during the decision making process? Note: Question numbers refer to survey questions in exercise Source: Amason, “Distinguishing the Effects of Functional and Dysfunctional Conflict”

D/I and D/A tend to create more conflict Consensus Dialectical inquiry Devil’s advocacy Cognitive conflict Low/moderate High Affective conflict Low High/moderate

Data from exercise: more conflict in D/I and D/A Average reported Level* Consensus D/A & D/I Difference Cognitive Conflict 3. How many disagreements over different ideas about this decision were there? 2.7 4.7 +2.0 4. How many differences about the content of this decision did the group have to work through? 3.6 +1.1 Affective 5. How much personal friction surfaced within the group during the decision making process? 2.1 3.3 +1.2 6. How many personality clashes became evident during the decision making process? 2.2 3.1 +0.9 *) Scale: from 1 (very low) to 7 (very high) Source: MIIC exercise Nov 2010

Cognitive conflict associated with more critical analysis Q3 vs. Q7: cognitive conflict and critical evaluation of initial assumptions +0.26 Q3 vs. q8: cognitive conflict and uncovering of valid assumptions, recommendations +0.38

However, affective conflict negatively correlated with implementation and enjoying working with the group Q6 vs. Q11: personality clashes vs. willingness to implement decision -0.02 Q6 vs. Q9: personality clashes vs. enjoying working with this group -0.22

Problem is, cognitive and affective conflicts tend to go hand-in-hand Q3 vs. Q5: disagreements over ideas vs. personal friction +0.51 Q3 vs. Q6: disagreements over ideas vs. personality clashes +0.63

Use DI or DA to stimulate debate Devil’s advocacy + Stimulate conflict and debate + Dialectical inquiry

Benefit from cognitive conflict 0.26/0.38 Devil’s advocacy + Cognitive conflict + Debate alternatives, Deep analysis, New ideas + Better decisions + Stimulate conflict and debate + Dialectical inquiry Note: numbers are correlations from MIIC data Nov 2010

… but also increases affective conflict 0.28/0.35 Devil’s advocacy + Cognitive conflict + Debate alternatives, Deep analysis, New ideas + Better decisions + Stimulate conflict and debate 0.51 to 0.63 + Affective Conflict + Dialectical inquiry Note: numbers are correlations from MIIC data Nov 2010

Sum: Key is to increase cognitive and decrease affective conflicts 0.28/0.35 Devil’s advocacy + Cognitive conflict + Debate alternatives, Deep analysis, New ideas + Better decisions + Stimulate conflict and debate 0.48 to 0.59 + Affective Conflict Personal animosity, Less group harmony, Poor decision acceptance Poor implementation + + + Dialectical inquiry -0.02 to -0.22 (-0.47 to -0.62) Key is to break this path Note: numbers are correlations from MIIC data Nov 2010

Additional data from another student group, INSEAD MBAs (n=110) This is a larger group so more validity. The conclusions are very similar

Data from exercise today: more conflict in D/I and D/A Average reported Level* Consensus Dial. Inq. Dev. Adv. 3. How many disagreements over different ideas about this decision were there? 2.7 3.3 3.5 4. How many differences about the content of this decision did the group have to work through? 2.8 3.4 5. How much personal friction surfaced within the group during the decision making process? 1.6 1.9 2.2 6. How many personality clashes became evident during the decision making process? *) Scale: from 1 (very low) to 7 (very high)

Cognitive conflict in D/A and D/I associated with critical evaluation Evaluating assumptions New recommendations/assumptions

However, affective conflict negatively correlated with implementation and enjoying working with the group Q6 vs. Q11: personality clashes vs. willingness to implement decision -0.17 Q5 vs. Q 11: personal friction vs. willingness to implement decision -0.26 Q6 vs. Q9: personality clashes vs. enjoying working with this group -0.44 Q5 vs. Q9: personal friction vs. enjoying working with this group -0.29

Problem is, affective and cognitive conflict correlated

Best spot: high cognitive, low affective