Wednesday, November 9, 2016

Understanding Three Business Effects and Paradoxes for Improving Management Effectiveness

Modern management is both science and art. We should learn from both our own experiences and from others’ lessons, as well as collective wisdom.

Either at the individual level or organizational level, people experience, grow, fail, and learn, from their own experiences or others' failure lessons. There are many interesting effects in the respective field of the study. From a business management perspective, which “effects” should you understand in order to achieve management effectiveness and efficiency?
The Abilene Paradox: Like many things in the world, there are both pros and cons in the crowd of wisdom and team decision-making. The team decision works because they bring different perspectives and more information to the table. If there is a heterogeneous group setting, they help balance out the biases that from which we all suffer, or fill the blind spots each one of us perhaps has some. They help generate more of everything (viable alternatives, criteria, etc.),  all of which are shown to improve the quality of decisions. However, there are a number of contrary factors at play in team decision-making. There is the Abilene Paradox that comes into play often in groups. In an Abilene paradox, a group of people collectively decide on a course of action that is counter to the preferences of many of the individuals in the group. It involves a common breakdown of group communication in which each member mistakenly believes that their own preferences are counter to the group's and, therefore, does not raise objections. A common phrase relating to the Abilene paradox is a desire to not "rock the boat." That often turns little defect to the bigger problem or even the serious business failure.

Gestalt Effect: The Gestalt effect is the capability of our brain to generate whole forms, particularly with respect to the visual recognition of global figures instead of just collections of simpler and unrelated elements (points, lines, curves). Gestalt psychology tries to understand the laws of our ability to acquire and maintain meaningful perceptions in an apparently chaotic world. The central principle of Gestalt psychology is that the mind forms a “whole” with self-organizing tendencies. This principle maintains that the human mind considers objects in their entirety before, or in parallel with, the perception of their individual parts; suggesting the whole is other than the sum of its parts. The fundamental "formula" of Gestalt theory could be expressed in this way, "There are whole, the behavior of which is not determined by that of their individual elements, but where the part-processes are themselves determined by the intrinsic nature of the whole. It is the hope of Gestalt theory to determine the nature of such wholes." From a business management perspective, it encourages holistic thinking and understanding the intrinsic interconnectivity between parts and whole, in order to solve problems in a structural way.

Bystander effect. As social psychologists have long known, people are far more likely to aid a victim in distress or report an apparent emergency if they are alone than if other people are around. One reason: If you’re uncertain what to do, you’re likely to take your cues from other people whenever possible. Some psychologists suggest that simply being aware of this tendency is perhaps the greatest way to break the cycle. From the business management perspective, when faced with a situation that requires action, understanding how the bystander effect might be holding you back and consciously taking steps to overcome it can help.

Modern management is both science and art. We should learn from both our own experiences and from others’ lessons, as well as collective wisdom. The difference in utility between one’s own experience and the experience of another is nothing more or less than the difference between the credibility of direct observation coupled with one's own interpretation of it, and the credibility of a reported observation coupled with multiple interpretations that arise from multiple examinations of the observation. Not just get puzzled by those effects or paradoxes, but to avoid the pitfalls, learn and grow from them, to improve digital management maturity.


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