Decision Making: Not as Easy as One Thinks The Power and Problem of Groups and Groupthink 09/25/14

The Art and Science of Decision Making May 8, 2014

Noel Tichy & Warren Bennis October, 2007 Making Judgment Calls The ultimate act of leadership A leader’s most important role in any organizations is making good judgments. p. 94

“... half the decisions made in business and related organizations fail” (p. 3) A twenty-year study of 400 decisions 2002 Not because of poor planning, but rather poor thinking!

billion neurons & trillion connections For the average adult, the brain can read 300 wpm, listen to 450 wpm, speak up to 180 wpm and instantaneously construct meaning and generate insights from a string of symbols that makes communication possible. (Ley & Chang, 2008)

The mind is easily tricked...

The mind is makes up things... FAE Fundamental Attribution Error

While the brain can process information and make inferences at tremendous rates, it has at least two limitations when it comes to making decisions. 1.The brain is self-referencing. – The brain relies on itself to make inferences and judgments. As a result, biases, expectations, experiences, and values knowingly and unknowingly shape perceptions. 2. All knowledge is bounded. The brain is incapable of omniscience.

As a result, we are stuck with our own interpretation of the data when making knowledge claims and rendering decisions

Extensive research from cognitive psychology indicates humans are inherently flawed and biased information processers. (Avolio and Gardner, 2005, p. 317).

~50% saw the unexpected event. (Simons and Chabris, 1999)

60 plus sources of interference 1.Failure to listen 2.Inattentional blindness / Bounded awareness 3.Overreliance on what is available 4.Overreliance on what is representative 5.Misleading anchors 6.Hindsight bias 7.Non-rational escalation of commitment

Be an expert on what is shaping the inference. Be more systematic in gathering and evaluating relevant data Assume alternative perspectives Ask the why and why not – keeps it ethical

Educate your instincts* “Go with your gut.” “Follow your intuition.” “Trust your feelings, Luke.” We’ve all heard the sayings. But do your instincts make good decisions? *From Fortune Magazine, June 27, 2005 pg. 102 It depends – some guts are better educated

Heart – 40,000 neurons Gut – 100 million neurons Think Twice: How the Gut's "Second Brain" Influences Mood and Well-Being The emerging and surprising view of how the enteric nervous system in our bellies goes far beyond just processing the food we eat Feb 12, 2010|By Adam HadhazyAdam Hadhazy

.... every a judgment requires a judgment call on what type of judgment to make.

Social dynamics influence individual decisions and behavior We are not as independent thinkers as we think we are!

supervised the deportation of 6,000,000 Jews to Nazi gas chambers I was doing my job! A highly decorated public administrator

The Influence of the Group on Decision Making 09/25/14

Ethical Decision Making November 13 4 Scenarios 4 to 5 minutes on each

Social Capital A Pillar of Trust and High Performance September 19, 2014

Decision Making: Not as Easy as One Thinks The Power and Problem of Groups and Groupthink 09/25/14

The Urn Game Review contents of two urns (pitchers). o Urn W: Two white balls and one yellow ball o Urn Y: Two yellow balls and one white ball Select an urn with a coin flip. Select two participants from each table. Participants see one ball from the urn and review the list of previous guesses. Participants identify the color of the ball they selected from the urn. Each participant guesses either Urn W or Urn Y. Review contents of two urns (pitchers). o Urn W: Two white balls and one yellow ball o Urn Y: Two yellow balls and one white ball Select an urn with a coin flip. Select two participants from each table. Participants see one ball from the urn and review the list of previous guesses. Participants identify the color of the ball they selected from the urn. Each participant guesses either Urn W or Urn Y. Source: Professor David McAdams

Groupthink (Janis) Defined: “A mode of thinking involving a cohesive group in which the members’ striving for unanimity overrides their motivation to appraise realistically alternative courses of action.” (Viotti and Kauppi)

Groupthink (Janis) Symptoms of Groupthink o Type I: Overestimation of the group Illusion of invulnerability Belief in inherent morality of the group o Type II: Close-mindedness Collective rationalization Stereotyped views of out-groups Symptoms of Groupthink o Type I: Overestimation of the group Illusion of invulnerability Belief in inherent morality of the group o Type II: Close-mindedness Collective rationalization Stereotyped views of out-groups

Groupthink (Janis) o Type III: Pressures towards uniformity Self-censorship Illusion of unanimity Direct pressure on dissenters Self-appointed ‘mindguards’ Consequence: Low probability of success o Type III: Pressures towards uniformity Self-censorship Illusion of unanimity Direct pressure on dissenters Self-appointed ‘mindguards’ Consequence: Low probability of success

Groupthink (Janis) Example: Bay of Pigs invasion in 1961 o Overview o Symptoms Illusion of invulnerability Illusion of unanimity Example: Bay of Pigs invasion in 1961 o Overview o Symptoms Illusion of invulnerability Illusion of unanimity

“Our meetings took place in a curious atmosphere of assumed consensus” (Arthur Schlesinger, Jr.)

Groupthink (Janis) Example: Bay of Pigs invasion in 1961 o Overview o Symptoms Illusion of invulnerability Illusion of unanimity Self-censorship Example: Bay of Pigs invasion in 1961 o Overview o Symptoms Illusion of invulnerability Illusion of unanimity Self-censorship

“In the months after the Bay of Pigs I bitterly reproached myself for having kept so silent during those crucial discussions in the Cabinet Room, though my feelings of guilt were tempered by the knowledge that a course of objection would have accomplished little save to gain me a name as a nuisance. I can only explain my failure to do more than raise a few timid questions by reporting that one’s impulse to blow the whistle on this nonsense was simply undone by the circumstances of the discussion.” (Arthur Schlesinger, Jr.)

Groupthink (Janis) Example: Bay of Pigs invasion in 1961 o Overview o Symptoms Illusion of invulnerability Illusion of unanimity Self-censorship Self-appointed ‘mindguards’ Example: Bay of Pigs invasion in 1961 o Overview o Symptoms Illusion of invulnerability Illusion of unanimity Self-censorship Self-appointed ‘mindguards’

“You may be right or you may be wrong, but the President has made his mind up. Don’t push him any further. Now is the time for everyone to help him all they can.” (Attorney General Robert Kennedy)

Groupthink (Janis) Possible remedies o Encourage discussion within the group o Assign the role of “critical evaluator” to every member o Avoid stating their preferences at the beginning of the process o Invite one or more outside experts to each meeting o Ask at least one member to play the role of devil’s advocate Possible remedies o Encourage discussion within the group o Assign the role of “critical evaluator” to every member o Avoid stating their preferences at the beginning of the process o Invite one or more outside experts to each meeting o Ask at least one member to play the role of devil’s advocate

Thank You Questions Comments Concerns Objections

Ethical Decision Making: Deceiving Ourselves Why Do Good People Do Bad Things? November 13