by Craig Clermont
While legislation has been passed and good advice has been given to help minorities crack the glass ceiling, little has changed in the C-Suite over the past twenty years or so.
Two key factors perpetuate this: exclusiveness and a bias for speed. First, it is not that current leadership is consciously exclusive, or dislikes minorities or women, it is that they typically socialize outside of work, for example, with kids going to the same schools and attending same extracurricular activities. It follows that people within these tight circles will get the inside scoop on new positions and will likely be more trusted as compared to an outsider.
Second, when it comes to decision making executives believe ‘speed is king’. They prefer not to invite differing opinions which would only muddy the water, slow things down, and make things too complicated. This bias toward speed is good for making most simple decisions, but the analogy does not translate over to complex ones—especially in today’s hyper-fast and hyper-connected environment. Our society now requires more deliberation, rather than less, where missteps can spread like contagion. Companies that continue to make strategic choices within their small bubble run the risk of hurtling toward a chasm that could have been pointed out by an outsider.
The lack of companies’ ability to diversify is reflected in the consulting firm Innosight’s forecast that roughly half of the S&P 500 will be replaced over the next ten years.
Their study showed that while leaders recognize the risks of an increasingly unpredictable future and 66% agree that transformation is imperative for adapting to this new world, more than 37% said they were NOT confident they could transform over the next ten years. The largest obstacle for this transformation is cited as ‘day-to-day decisions’. In other words, even if they have transformational direction, middle managers and front-line staff are not embracing it.
It only makes sense that upper management would be more successful in gaining the cooperation of the employees tasked with the execution of their decisions if they were part of the decision-making process from the outset. Together they could come up with how the transformation should occur. In addition, management would gain diverse insight from those who interact directly with customers, partners, vendors, competitors and the media.
Leading strategists, decision-scientists, and rock-star executives support the theory that the modern C-Suite should embrace diversity’s discord into their strategic decision making. For example, Peter Drucker in The Effective Executive says: “Decisions of the kind the executive has to make are not made well by acclamation. They are made well only if based on the clash of conflicting views, the dialogue between different points of view, the choice between different views. The first rule in decision-making is that one does not make a decision unless there is disagreement.”
Echoing this theme strategic thought leader, Thomas Davenport in Judgement Calls, begins with: “Great organizations expand the number of people they involve in important decisions because they know that while individual humans are fallible, in the aggregate, they are usually more effective. They tap into their employees and customers and partners’ broad range of expertise and they ask for their opinions – they deliberate and problem solve towards a better answer instead of going with the gut.” And a bit later he says, “Good leaders create the agenda of decisions to be made. They set the tone for culture and decision processes. They encourage the diverse members of their organizations to step up and participate in deliberations and decisions.” This new style of decision making is a shift from ‘dictatorial’ to ‘participative’, helping businesses deal with volatile change.
Business consultants Marcia Blenko, Michael Mankins, and Paul Rogers of Bain & Co in Decide and Deliver state that a shift to the participative style of decision making is a benefit. “Changing to a participative style can improve both the speed and the quality of decisions…Boeing’s shift to a participative style under Alan Mulally helped the company improve the quality of its pricing decisions. Its previous directive style excluded information from lower-level executives—input that would have led to better choices.” As a bonus, “Employees of participative companies are three times more likely than other employees to recommend their organization as a place to work.”
John Hammond, Ralph Keeney, and Howard Raiffa in their easy to read yet powerful book, Smart Choices, state the obvious yet profound message: “Seek the input of others for additional perspectives” and “In seeking out advice, consider people in fields beyond the obvious.”
Andrew Campbell, Jo Whitehead, and Sydney Finkelstein say, in their Harvard Business Review Article, Why Good Leaders Make Bad Decisions: “Introducing further debate and challenge can ensure that biases are confronted explicitly. It works best when the power structure of the group is balanced.”
In the October 2007 Harvard Business Review issue, even hard-charging Jeff Bezos of Amazon surprisingly says, “We have an informal atmosphere, which I think helps people tell me no–and not just me. It’s also really important that they (anyone) be able to say what they think to their senior vice president or vice president and so on. An informal atmosphere, I think, is a huge benefit.” Maybe this encouragement for anyone to speak up is one of the keys to their success?
An insular C-Suite operating in their own tight bubble does so with their hands tied behind their backs and blindfolds on. Not only when they subconsciously exclude minorities, frontline workers, and women, but also those who are too shy to speak up. Former lawyer and negotiations expert Dr. Susan Cain says, with much force in her NYT bestseller, Quiet: “Introverts living under the Extrovert Ideal are like women in a man’s world, discounted because of a trait that goes to the core of who they are.” For people who still believe, either consciously or unconsciously, that men are naturally better at decision making, recent studies from Carnegie Mellon and MIT show that “a group’s collective intelligence was predicted not by the average IQ score of its members or by the intelligence of the group’s smartest member—the single most important factor predicting a group’s intelligence was its sensitivity. Groups that came up with the best solutions had team members who successfully read the nonverbal cues of their teammates. That means teams with more women reached “better decisions” and “when a team has to make a choice, it needs people who are tuned to the group dynamic as well as the factors in the decision.”
All this to say that there are three powerful business benefits to designing more inclusive decision groups. These include better quality decisions, less risk of making a terrible choice, and improved buy-in from the people necessary to implement the decision. A fourth, more easily overlooked advantage, though, is that possibly by working together more, there may be an added emotional benefit. American Philosopher, John Dewey, hints at the complex, changing nature of life, and attempts to put into words how we grapple with it: “In every waking moment, the complete balance of the organism and its environment is constantly interfered with and is constantly restored… Life is interruptions and recoveries.”
As decision makers reach out to include diverse viewpoints, from middle managers to frontline workers, they will be better able to notice the ‘interruptions’ and better enact a ‘recovery’ and hence also make great decisions more quickly.
Dewey goes on to say in Human Nature and Conduct “At these moments of a shifting of activity, conscious feeling and thought arise and are accentuated,” nudging us towards the possibility that we can grow our consciousness when we deal with challenges together.”
So, cooperating on tough decisions with diverse characters is not only smart business, but it has the potential to create joy—even if there is some discord during the process – and isn’t boldly facing our largest choices, together, one of the highest ideals of capitalism and democracy?
Copyright 2017 – Craig Clermont
Craig Clermont has a degree in economics and is a Senior Account Executive for Konica Minolta’s legal division. Craig enjoys helping his clients run their business more efficiently and is a life-long student of decision making and strategy.
See Craig on October 5th at the Seattle Main Library where Konica Minolta will present “Legal Technology Trends for 2018” at 5:30pm in the Washington Mutual room. To RSVP, please email Craig at email@example.com.
Licensed Image Credits
- Adobe Stock_58552240 Business men with arms crossed, by Tanusha
- AdobeStock_78226369 People Cheering, by Kzenon
- AdobeStock_134774393 Male with glass wall, by Kzenon
- AdobeStock_134885362 Running over the chasm, by bluedesign
Quotes and Book Covers
- Corporate Longevity, Turbulence Ahead for Large Organizations, by Scott D. Anthony, S. Patrick Viguerie and Andrew Waldeck
- Decide and Deliver, Marcia Blenko, Michael Mankins, and Paul Rogers, Harvard Business Review Press
- The Effective Executive: The Definitive Guide to Getting the Right Things Done, Peter Drucker, Harper Business
- Human Nature and Conduct, John Dewey, Amazon Digital Services LLC
- Judgement Calls, Thomas Davenport and Brook Manville, Twelve Stories of Big Decisions and the Teams That Got Them Right, Harvard Business Review Press
- Quiet, Dr. Susan Cain, Broadway Books and Random House LLC
- Smart Choices: A Practical Guide to Making Better Decisions, John Hammond, Ralph Keeney, and Howard Raiffa, Harvard Business Review Press
- Think Again: Why Good Leaders Make Bad Decisions and How to Keep it From Happening to You, Andrew Campbell, Jo Whitehead, and Sydney Finkelstein, Harvard Business Review Press