Improving decision making in organisations

Impact Area: Business Strategy and Effective Management

Institution: Strathclyde Business School, University of Strathclyde

Leading Academic: Professor Colin Eden FBAM, Professor Fran Ackermann FBAM

Introduction

Making good decisions with others is a vital part of much business activity, but it is not always easy to avoid the well-known problem of ‘Group-think’, where groups take irrational decisions, suppress dissent or ignore alternatives due to a psychological drive for consensus. This means that organisations are in danger of being blinkered to strategically important new opportunities.Professor Colin Eden FBAM and Professor Fran Ackermann FBAM, then of Strathclyde Business School, set out to address these issues.

They looked at research around ‘Procedural Justice’ as this relates to the way in which decisions are made and participants are treated during decision making. Existing research suggests that an environment where participants feel a sense of fairness in contribution and being ‘listened to’ will encourage cooperation, trust, and engagement with the group's goals and this showed the researchers the importance of including support for the social process as well as effective analysis. Additionally, they were very aware of the shortage of time typically available to senior teams.

The team developed Group Explorer - a software tool to support group decision making - which is based on an understanding of how individuals change their mind through a process of social and psychological negotiation. It recognises that developing, researching, and using group support designs, which support a social process as well as effective analysis, are fundamental if there is to be a good chance of implementing agreements about resolving complex situations. In addition, the system is designed to make strategy-making and problem-solving meetings considerably more productive.

The aim was to counter Group Think by developing a mechanism to increase the chances of productive enquiry and creativity. Research into ‘getting to yes’ (negotiation and conciliation theory) underpinned the design of Group Explorer and the accompanying methodology of causal mapping.  In this way views and options can be revised to enable agreements about appropriate strategies and actions that will effect purposeful organisational change – these are the creative conclusions from the causal maps developed by the team.

 

Benefits and Impacts

Emotional heat’ - Group Explorer has been used in the NHS. One example of effective strategic problem solving took place within a Health Service Multi-organisational group of 30 GP’s, social workers, care home managers, and NHS senior managers addressing the strategic issues associated with increasing dementia. The sponsor for the work wrote that the system enabled them to: “Understand their different perspectives around the key issues that were impacting on the functioning of the system. This took some of the unhelpful ‘emotional heat’ out of the discussions as individuals were able to understand that a different opinion was based on a different model of the world”.

Time efficient and effective - A series of regular workshops included 8 top team managers from a nuclear power operator and 8 senior managers from the Regulator used the process in an effort to resolve dysfunctional behaviours between the organisations. The Chief Inspector (ONR) told the researchers that “these strategic conversations, independently facilitated using your methodology and IT, have been time efficient and effective in developing our strategies, internal focus and external relationships”.

Similarly the process was used to facilitate better working relationships between the Regulator and the Department for Energy and Climate Change (DECC as was). Post workshop interview notes from several named Senior Civil Servants of DECC and members of the Regulator top management team have underscored this. For example: “the model helped catch people up and develop a sort of common understanding. We learnt a lot more about each other. …. the mapping was very successful in deciding what needs to be done”; “the structure of the [workshop] – the format – takes out the negative elements…  very different from traditional meetings – it provided a mechanism for honest discussion.” “The software was incredibly useful – setting preferences and getting everything out in the open. It would have been much slower if everyone had to speak (and we wouldn’t have got that much on paper) … good conflict resolution session with positive outcomes re attitudes and solid deliverables”.

Shared understanding and agreement - Another group of 18 Chief Executives & senior managers in the NHS (Consultants, Hospital Chief Executives, Government Civil Servants responsible for health provision, Senior nursing staff, and NHS administrators) were helped to address issues in acute hospitals. The Deputy Director of Health Performance stated that “it was important for us all because it gave us a conversation where we could reach conclusions and prioritise. We finished up with agreements that were neither NHS or Government, but rather a shared understanding and agreement.  We ‘got to a good place as a group’.”

Progress in such a short time - Scottish Enterprise (SE) got together a group of Scottish company CEOs to consider how Scotland could become more competitive. The SE sponsor said that “using both the Group Explorer system and the mapping tool helped to draw out the deep and underlying competencies that make our sectors different… I can’t imagine any other system or method that would enable us to have made as much progress as we did in such a short time”.

Move quickly from idea to agreement to the governance of delivery - Clydesdale Bank used the tool to help a team of senior managers seeking agreement about a strategy for new working practices across departments. The Transformation Director at Clydesdale Bank attested to the use of the system over a number of years and noted that his decision to use the approach was based on “experience of it increasing productivity, the ability to draw on multiple perspectives – often from those who have unique views but do not contribute in larger groups and most importantly to be able to move quickly from idea to agreement to the governance of delivery”.

Reduction in dysfunctional behaviours - The top management team of a construction company also used the tool. The Chief Executive wrote: “This approach had a transformation impact on the company with a reduction in dysfunctional behaviours and an increased ability to identify and agree joint goals”. The “system helped protect anonymity in the early part of the session and ensured that everything including highly contentious items was put up for debate and agreement. The outcome was high levels of ownership and commitment from the two separate SMTs on the way forward.” “This approach had a transformation impact on the company with a reduction in dysfunctional behaviours and an increased ability to identify and agree joint goals.  By 2008 annual sales had reached £300m with a corresponding increase in profit.  Employee numbers increased to over 1700.

Aiding risk assessment - The tool has also been used to aid risk assessment: with EdF in the case of a nuclear new build; and with a power supply company in identifying and exploring the systemic relationship between strategic risks. The Project Development Manager stated that “Risks attained beyond the traditional top down risks identified through project risk registers”… “the software and mapping process enabled significant progress to be made in a very short period of time – capturing and structuring 100+ risks and subsequently prioritising them in as little as half a day”.

The researchers have also carried out workshops with companies outside the UK including senior management ‘bid teams’ within Bombardier (Canada), management teams in the Netherlands (Reed-Elsevier), USA (various), Luxemburg (SES), Australia (Health) and Denmark.