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How to handle decision making in the management teams? In many companies’ management and leadership processes seem to work well, but suddenly something surprising happens. In spite of many cross-checks and meetings, things turn into a non-expected direction. All think that everything was in place … but then something emerges and business plans are outdated in a day. Why this happens?

It is typical than there are always some biases in management teams of companies. It is typical that for individuals it is not easy to make question marks on official agreements and strategies. Even though all nod in agreement and look happy it is not easy to say something critical. “It was settled” or “we all agreed” are typical notes on the memos of companies in this kind of decision situations.

Raising dissenting voice is not easy – especially when the chief boss decides something. It is much easier to be among “yes-sayers” than among “critical questioning men”. Self-fulfilling prophecy is the tendency to engage in behaviors that elicit results that will (consciously or subconsciously) confirm our beliefs. “Yes men” cause self-fulfilling prophecies. There can be also a halo effect, the tendency for a person’s positive or negative traits to “spill over” from one area of their personality to another in others’ perceptions of them.

In many case studies of management processes, some typical mistakes have been identified. First, there is tendency to devote attention only to those events seen as most likely. Secondly, once the team of decision makers had made up its mind as to what was going to happen, even conclusive information that the decision was poor did not change the prediction and associated decision. Thus there is typically a problem of groupthink in management teams. One reason for this problem is homogenous social and cultural backgrounds.

Often management teams have similar backgrounds: university degree holders, men with similar hobbies, career paths, middle-class people, and homogenous values. False consensus effect means the tendency for people to overestimate the degree to which others agree with them. Sometimes there can be anchoring decision-making biases, where there is the tendency to rely too heavily, or “anchor,” on one trait or piece of information when making decisions.

Another problematic issue in management teams is overcoming overconfidence. The future looks assured for them. Their judgments are made with deep confidence. However, people may feel confident that they do know the right answer but actually don´t. They don´t know they don´t know. Other options of knowing are: (1) They do know they know; (2) they don´t know they do know and (3) they do know they don´t know. Obviously the best option would be to know that they know. In reality this option is not often available for a management team.

Third typical bias of a management team is a confirmation bias. What it means? It means that we don´t place ourselves in situations where we can test the quality of our judgment. We want to seek that information that will confirm the quality of our predictions and decisions. It is quite human character of people, wanting to be in right – winning team. In this way we are selective in our observations.

Fourth bias in management teams, is so called hindsight bias, which is connected to our readiness not learn from experiences. In general, we don´t learn from experience because experience has little to teach us. That is why our recollections of our judgmental predictions confirm these to have been accurate. Some call this bias “I-know-it-all-along-effect”. Thus, our judgments are rooted to history and it cause biases to emerge.

Fifth bias can emerge because we rely on expert predictions too much. We can call this bias as an expert bias. Also experts can cause group thinking bias and other people may suffer from this kind of bias. There are many other kinds of biases, too like randomness bias, sunk-cost bias, self-serving bias and escalation and commitment bias. Projection bias is close expert opinion bias. It is the tendency to unconsciously assume that others share the same or similar thoughts, beliefs, values, or positions.

Sixth bias, randomness bias means that there is a tendency people have to seek patterns where none exist and to invent the existence of unjustified causal relationships. It is the tendency of people to make sense out of events which are so random in nature that not enough should be read into them. Close to randomness bias is Gambler´s fallacy, the tendency to assume that individual random events are influenced by previous random events.

Seventh type of bias, sunk-cost bias is often connected to too optimistic thinking. Sunk-costs are costs that cannot be recovered once they have been incurred. Sunk-costs bias greatly affects the decisions, because humans are inherently loss aversive and thus normally act irrationally when making economic decisions.

Eight type of bias, self-serving bias occurs when people attribute their successes to internal or personal factors but attribute their failures to situational factors beyond their control. The term, “self-serving bias”, is used to describe a pattern of biased causal inference, in which praise or blame depend on whether success or failure was achieved in reality.

Ninth type bias, escalation and commitment bias means tendency to invest additional resources in an apparently losing proposition, influenced by effort, money, and time already invested. The term is also used to describe poor decision-making in business, government, information systems in general. Escalations and commitment biases are typical in software project management, in politics, and in addictive gambling. To sum up: there are 9 key sources of bias in management teams:

• Overcoming overconfidence;
• Group thinking bias;
• Confirmation bias;
• Hindsight bias;
• Expert opinion bias;
• Randomness bias;
• Sunk-cost bias;
• Self-serving bias and
• Escalation and commitment bias.

It is good to be aware of these potential decision making biases in decision making situations. We could avoid these typical biases, if we were aware of these potential biases. The lessons from history can tell us that many management teams do not identify these biases and serious management failures happen. A sad truth is that we don’t always learn from experiences. There are very many historical lessons available for decision makers but we should learn something from these old lessons. From this perspective “learning organization” is a modern myth.

There is need to question some issues (and biases) in many management teams. That why bohemian persons and “out of box” thinkers may be very valuable members in management teams. It is easy to say that we should be free of biases, but in reality we are often slaves of biases and fallacies. Only personal and critical reflections can help us to be free from these biases. Open and critical discussions in management teams should be encouraged and supported too. Daily illusions about effective control should be avoided in all the decision-making situations and processes.

Further reading

Wright, George (2001) Strategic Decision Making. A Best Practice Blueprint. John Chichester: Wiley & Sons.
Goup 3: Bhavesh, Brunica, Deepak, Kane, Kiran, Lisette & Monica (2012) Biases in Decision-making. Web: http://www.scribd.com/doc/21613064/Biases-in-decision-making
Scribd, “gaea_myzticmoon” (2012) Biases. Web: http://www.scribd.com/doc/73002909/Biases

Challenging Futures of Human Beings and Creative Class: Visions of Robots, Bohemians, Bohemian Robots and Robotized Bohemians

The concept of robotization was presented in 1927. Robotization is the process of turning a human being into a robot. Close synonyms of robotization are mechanization and automation. In the on-going process of robotization humans will be made persons who are machinelike, as in giving responses or performing work. Robotized assembly lines are good examples of robotization. Robotization has not reached saturation point.

Just as William Whyte’s 1956 classic book The Organization Man showed how the organizational ethos of that industrial age permeated every aspect of life, Richard Florida described a society in which the creative ethos is increasingly dominant. The rise of creative class is today´s reality in the global economy. Millions of people are beginning to work and live much as creative types like artists and scientists always have done. This “creative class” is found in a variety of business fields, art to science, research to development, biotech to education, from engineering to theater, and architecture to small business. In this way the scale and scope of bohemian cultures is broadening. In the future, members of the creative class will determine how workplaces are organized, what companies will prosper or go bankrupt, and even which cities will thrive or wither. Bohemians of the creative class are really important social group. Our mind sights, core values, tastes, our personal relationships, our choices of where to live, and even our sense and use of time are changing radically.

Now robotization is coming to other business and societal areas, to more complex work tasks, even to the works of creative class. For example, robotization of war and robotization of many welfare health services are going on. In the field of information technology applications, ubiquitous technologies make robotization more intensive and fast. Robots will be combinations of hardware and software. Ubiquitous technologies combine hardware and software systems.

Now, it is actual situation to reflect what human´s destiny is in the highly robotized society. Reorganization of the labor market is in front of us. For example, we can just ask, what China and India will do with the on-going robotization process?
Bohemians are very different compared to bohemians. Bohemians are not as obedient as robots. An obedient worker is still the ideal employee compared to the bohemian workers. Bohemian employees are expected to be more sick leaves compared with the robots. Robots need just technical maintainers. People need more extensive support services, for example, occupational health services and holidays. Robots do not go crazy. Robots can also work on weekends. So robots are having a lot of advantages compared to the bohemian people.

In the robotized society leadership, management and strategies will change significantly. The term “singularity” was coined by science fiction writer Vernor Vinge, who argues that artificial intelligence, human biological enhancement or brain-computer interfaces could be possible causes of the singularity. Especially people’s own self-management strategies and models will be important issues. The big challenge of post-modern societies is the thorough preparation of the fact that robots are superior workers compared to humans. We can reasonably argue that in the conditions of robotization, people should become even more human, unique and special. Man cannot survive in the competition with robots in other way than by highlighting her/his own special human characters.

Actually all the humans will face a strong pressure to be more bohemians, very special persons. A bohemian robot is a future vision, which is not so easy to engineer or re-engineer. Avoiding becoming an average is a big challenge for people in the robotized industries and business life. Always some of the medium must be matched. This problem will remain.

A bohemian robot is less likely to be the future mission that a robotized bohemian. Actually both “robot” missions are still challenging. We can expect that in the futures there will be all the variations of robotization.

And machine intelligence, a product of human design, will be far more intelligent than its human creator. Thus, there will be bohemians, robots and robotized bohemians and bohemian robots. How long this process takes, is still an open question.

Technological singularity refers to the hypothetical future emergence of greater-than-human intelligence through technological means, very probably resulting in explosive super-intelligence. Singularity expert and scholar Raymond Kurzweil notes that the expected milestone year will be 2045 in terms of when he expects computer-based intelligences to significantly exceed the sum total of human brainpower.

Kurzweil predicts also that silicon-based life forms with the thinking capacity of humans should start arriving on the scene around 2029. This technological forecasting estimate is based on Kurzweil’s theory of “time and chaos,” which suggests that evolutionary time is accelerating. To sum up, there are very good reasons to think the future of robotized society. The bohemian alternative is one way to create counter forces and alternatives for a robotized society.

Index
1 Robotization
Web: http://www.wordswarm.net/dictionary/robotization.html
Web: http://www.thefreedictionary.com/robotization
2 Robotization of war
Web: http://www.globalresearch.ca/index.php?context=va&aid=27529
3 Willian H. Whyte
Web: http://en.wikipedia.org/wiki/William_H._Whyte
4 The Organization Man
Web: http://en.wikipedia.org/wiki/The_Organization_Man
5 Richard Florida
Web: http://www.creativeclass.com/richard_florida
6 Creative Class
Florida, Richard (2002) The Rise of Creative Class. And How it’s Transforming Work, Leisure, Community and Everyday Life. New York: Perseus Book Group.
Florida, Richard (2005) The Flight of the Creative Class: The New Global Competition for Talent. HarperBusiness, HarperCollins.
Hoyman, Michele & Faricy, Christopher (2009) It takes a village: A test of the creative class. Social capital and human capital theories. Urban Affairs Review. Vol. 44, pp. 311-333.
7 Raymond Kurzweil
Web: http://fi.wikipedia.org/wiki/Raymond_Kurzweil
8 Vernor Vinge
Web: http://en.wikipedia.org/wiki/Vernor_Vinge
9 Technological singularity
Kurzweil, Raymond (1999) The Age of Spiritual Machines. New York: Viking.
Kurzweil, Raymond (2005) The Singularity is Near. Penguin Group.

The BohoCompany Takes (W)initiative

The future winners are those who take the initiave. Those who create winning opportunities and change the game to favor their own strengths and capacities. These are people and companies we call The Bohos. The Bohos are builders for a better world, better functioning communities and more effective systems.

From AdHoc to WinHoc

Amidst changes, new ways and means of work people and companies often find themselves acting adhoc. In other words they invest on forming teams to solve problems. Mending systems. Filling gaps. Dousing fires. They examine the past and make decisions based on history, not the future. Not the scenario and vision they said they so much believe in.

It is always as staggering to realize the chasm between the powerpoints and real life decisions. The fancy terms on a white board doesn’t seem to have much to do when the reason of the now resurrect the deeds of the past, the terms of yesterday and the good old strategies that used to help when the pecking order was more important than knowledge.

The ice cold truth thus is: best practice wont help you. Next practice can be out of date when you learn it. You need to create your own, authentic, inimitable winning practice.

“The ice cold truth is: best practice cannot help you. Next practice can be out of date when you learn it. You need to create your own, authentic, inimitable winning practice.”

There is no way you can trust the traditional strategic competence. Your strategy train may not visit the station where the opportunities are showing up and things are happening. The old idea about tactics might be out of date – unethical. You cannot justify your actions with company policy nor argue that the good purpose will hallow the means.

Forget about agility. Agility means lean and lean means production and production means industries which will be taken over by automats and robots. They are agile – if you program them to be. Core competencies? No way! The effectiveness of the industrial age is not for the humans of today. And definitely not for the Bohos creating the future. Learning, enthusiasm and the ability to find right people to the right places beat the core competents with flying colours.

The Bohos take winning initiatives, they build winning oppotunities and situations. They plant seeds for new victories. They act WinHoc and their guiding principal is win*win(+win). They take care that winning results are achieved for both parties and also for a third party – for those who need to be considered be it the environment, the poor, the weak, the less fortunate.

From Initiative To Victory

The WinHoc is a dynamic version of AdHoc. When the AdHoc emerges as a reaction to a perceived need, the WinHoc starts up voluntarily and on one’s own initiative. In a WinHoc you take a powerful initiative. An initiative where you see a great potential to win. A person or a company acting WinHoc builds situations that are beneficial for their strengths and capacities and the strive to thrive in those situations.

WinHoc is inventorship with courage to bring up something totally new into discussions, markets and to the development – without having an order to do so *). The valuebase  win*win(+win) guarantees that WinHoc is ethical. Win*win aims to multiple wins and profits between partners and (+) challenges to create winning effects there where those effects are needed. Win*win(+win) can turn every action, plan and communication into a world bettering project, if you just conceive the philosophy in a right way and turn it into an every day practice.

“Win*win(+win) can turn every action, plan and communication into a world bettering project.”

To wrap this post up: The Bohos act WinHoc. WinHoc is a strategic/tactical way of action based on:

  1. Powerful initiative
  2. Dynamic creation of opportunities and situations where the potential to win is ample
  3. Winning the situations with the values and principles of win*win(+win)

WinHoc is more than being proactive. WinHoc is about dynamic creation and co-creation. Bohos acting WinHoc constantly ask: “what do we want to create?” and “what is next?”.

Competition Is A Happy Place

Many think competition is a bad and an exhausting place. This should not be true. Competition is not bad nor good. It is what you make it. Competition should be a place to come together and measure skills in order to find ideas for learning and improvement. Competition is  a way to find the right people to the right places and to create winning results. Authentic winning results emanate good. Competition comprehended in a right way does not exhaust but invests on greatness, character and challenge. Exhaustion is born from the constant constraint of peak performance. In a winning BohoCompany it is accepted that  a peak performance is not always needed but for the most of the times a winning performance where you align the energy with task at hand is sufficient.

What could prevent WinHoc from succeeding? A wrong attitude. It is impossible to act WinHoc if you do not accept that creative capacities, skills, sharp opinions, powerful insights go before status and strongholds. You need a lot of courage if you want to be a Boho and co-create with other Bohos who refuse to lie doggo in the comfybox of the status quo but are true to their highest values and authentic selves.

It takes a lot of  courage to act WinHoc but if you want to create a beautiful future, it is necessary.

To act WinHoc is to plant a rose where the other’s cannot see the opportunity for beauty and growth.

_________

(*)”Everything that is really great and inspiring is created by the individual who can labor in freedom.”  Albert Einstein

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