In 2015, Harvard Business Review published a study called “Making the consensus sale” by Karl Schmidt, Brent Adamson and Anna Bird. They found that most organisations spread decision-making authority across groups of individuals, “all of whom have different roles and all of whom have veto power”.
They surveyed thousands of stakeholders in business purchasing decisions and found that, on average, 5.4 people had to sign off formally on each decision.
But does that mean that group collaboration is always ineffective and time-wasting? Can’t it result in better, more objective outcomes?
The dynamics of group collaboration
“When people make decisions together as a group, there’s some interesting dynamics that go on,” says Management Consultant and Business Author Jane Mara.
She became fascinated with the collaboration process in organisations when exploring the science around how we reach outcomes.
“We know from brain imaging that decision-making is highly influenced by emotion,” she says.
Put a team of people on a decision, though, and there’s often a stronger outcome. A good team can evaluate decision options more pragmatically. The key? Having a diverse mix of people in a team to avoid the common pitfall of groupthink.
Groupthink arises when a team unconsciously prioritises conformity and harmony, so decisions are neither explored thoroughly nor challenged.
“Some people feel really uncomfortable in situations like brainstorming, which involves forcing the known possibilities to emerge,” says Mara. She adds that the process limits the number of choices that can emerge.
Mara’s earlier book, Intuition on Demand, reports on her global study of more than 50 key decision-makers from all over the world, in widely different roles – from entrepreneurs and executives to firefighters and nurses.
“I asked about how they made choices under pressure, and what worked best,” Mara says. “And I found that the best decisions were intuitive.”
“We like to think that we’re logical and rational – but decision-making is highly influenced by emotion,” she says.
Our decision-making is influenced by many factors, and values play an important role, Mara says.
“In good group decision-making, organisational values are prioritised over personal values,” she says. “But teams don’t always work that way because they may be in the grip of other emotions like stress, fear, anger or frustration.”
Decision-makers who perform well under stress have worked out how to avoid falling back on fear-based thinking, she says.
“You can learn to do this by understanding the neuroscience and cognitive biases in decision-making, then applying certain techniques to assist in whole-brain thinking, so you get out of the way of the stress of a strong emotion.”
What’s new in structures around decision-making?
Dustin Kehoe, who heads the Asia-Pacific division of research mavens GlobalData, recently published a major report that examines the key impacts of cultural transformation in HR across Australia.
He found that corporate cultural transformation, driven by digital disruption, is promoting new ways for teams to tackle complex problems, manage change and make critical business decisions.
Kehoe says methodologies such as ‘Agile’ and ‘Scrum’, developed to manage IT projects, have spilled over into HR where they are used to improve recruitment, develop talent and encourage team cohesion.
By flattening structures and reducing hierarchies, group outcomes can be reached through more reason and consideration, with less imposition from a single perspective.
Tools such as ‘design thinking’ help improve employee experience, and techniques such as ‘lean start-up’ are being deployed to streamline the on-boarding, training, development and performance management of employees.
“These tools provide strong frameworks to help management make decisions through a process of learning and validating when outcomes are uncertain,” Kehoe explains.
“They help management navigate a fast-moving environment, with mottos like ‘fail fast’ which ultimately reduce the impact of a bad decision.”
Kehoe says it’s not just the culture of HR that is changing; the changes are spreading across many large companies. “HR are massive change drivers – they’re changing the whole thinking and mentality of large organisations.”
He’s positive about the future, and says this cultural change is the key to transforming struggling organisations into successful ones in the digital age.
“When there’s a number of people involved in making a decision, the important thing is having the right people, the ones who are affected by it.”GlobalData Research Expert Dustin Kehoe
Today’s management tools have a few key things in common, Kehoe says. “They all say, ‘move fast; break down the silos, end interdepartmental rivalry and focus on the number one thing, which is the customer’.”
Changes such as dissolving silos, allowing ‘activity-based working’, including remote work and engaging part of your workforce via the highly mobile and flexible gig economy, will be reflected in fundamentally different ways that people collaborate and work together, he says.
“Combine these changes with the transformation that technology brings and you’ll see a decline in middle management, teams will work together in collaborative environments,” he says. “We will see changes in habits and behaviours and a bulldozing of hierarchies.”
He says such changes could lead to massive efficiency gains. “Inefficiencies we know about are things like collections of habits where groupthink happens; and decisions that are delayed because they have to go through so many different barriers.” Change the structures of working, and fewer people could potentially be needed to make a business decision.
“When there’s a number of people involved in making a decision, the important thing is having the right people, the ones who are affected by it,” Kehoe says.
“With so many organisations breaking down traditional barriers, you now have a better chance that in those group-made decisions, while you might have just as many people involved in the decision making, they’re going to be the people who have got the right input.”