Each month we will be sharing four, carefully-chosen articles from the Latest Issue of our flagship publication ‘theHRDIRECTOR’ which exemplify the high standards we strive to achieve. We hope you find this in-depth article of interest and decide to become one of our valued Subscribers.
Bomb disposal is a unique profession; selection and development is critical, HR issues, such as attrition and retention exist, but on the extreme end of the spectrum. Managing attrition involves keeping your operators alive and retention involves keeping them willing to risk their lives, day after day. There has to be as much focus on leadership as management, the equipment has to be right and procedures and policies have to be constantly refined.
Article by Dominic Brittain, Partner – Insight Leadership & Managing Director – Cognitive Bias Solutions
Even when all of the parameters are well-established in bomb disposal, people still die… defusing bombs. Sometimes this is simple bad luck – an operator being on top of a device when the timer runs down, for instance. But analysis showed that another significant factor was poor decision-making, driven by corruptions in their thinking. These corruptions are a result of mental short-cuts, whose repeated use leads to cognitive biases, which undermine clear thinking. A fundamental part of the development of effective operators involved the identification of their cognitive biases and employing concrete measures to mitigate them. The problem is, however, wider than bomb disposal. Experience of forming and chairing a group of senior and experienced leaders that coordinated the strategic response of nine government departments (with over 40,000 staff) to certain terrorist incidents, revealed that cognitive biases affected the strategic thinking of the group’s members. Inevitably, all members had individual cognitive biases, which they brought to the table (for example the Semmelweis Reflex which involves the tendency to reject new evidence that contradicted their department’s norms or beliefs). The interesting thing was that, as the leaders worked together, they formed a group bias that further corrupted their thinking when debating issues. Outgroup Homogeneity Bias, for example, where individuals see members of their own group as relatively more varied than those of other groups, grew astonishingly quickly, once the senior leaders had gone through the; Forming, Storming and Norming stages of Bruce Tuckman’s model. The biases of the team were toxic to their strategic function.
“Having a suboptimal way of selecting information and processing it, hinders a clear view of the organisation’s internal culture; ‘the way things are done around here’ – and the purpose of its systems – i.e. the agreed processes for getting things done”
Strategic leadership has two key roles, first; it must change the internal culture and systems of an organisation, so that they match the external environment – now and in the future. Secondly, strategic leadership must set the direction, make sense of what is emerging and steer the response. These two roles create the conditions for success for the operational and tactical levels – who actually fulfil the organisation’s purpose. The difficulty is that cognitive biases subvert every aspect of the strategic function, by affecting the way that both individual executives and the leadership team gather and filter information, and then by degrading the way that the information is processed. Having a suboptimal way of selecting information and processing it, hinders a clear view of the organisation’s internal culture; ‘the way things are done around here’ – and the purpose of its systems – i.e. the agreed processes for getting things done. Cognitive biases also weaken the view of the existing external environment, and cloud understanding of the possible future environments that the organisation must prepare for. They also subvert the choice of direction that the organisation should take, diminish a clear view of what is emerging and undermine choices about the response. In the counter terrorism example above, the role of the group was
ground-breaking and clarity-of-thought essential. Much work was done with the team to ensure that its own culture and systems were geared towards mitigating group cognitive biases.
There are over 150 recognised cognitive biases, and identifying the ones that the senior leadership team had, and then ensuring that they were mitigated effectively, was a Herculean task. Experience, from the bomb disposal profession, of the biases that leaders typically held certainly helped, but the Chairman’s role was not an easy one. The main lesson that emerged was that specific mitigation measures were the key. When the group’s cognitive biases were correctly diagnosed and targeted mitigation measures applied, strategic thinking was noticeably clearer and more resilient. Work with senior leadership teams in industry and commerce has revealed the same problem – cognitive biases corrupting all aspects of the strategic leadership function. (This analysis was underscored by a 2008 McKinsey survey where 60 percent of executives thought that bad strategic decisions were about as frequent as good ones). The problem is not trivial. Companies die too, and poor strategic choices are a frequent cause. The difficulty when helping senior leadership teams overcome their biases in the private sector was that, diagnosing their cognitive biases was hugely time-consuming, and thus prohibitively expensive. A breakthrough occurred in 2010 with the publication of research by Lovallo and Sibony in the McKinsey Quarterly. This identified five areas of cognitive biases that affect senior leadership teams in business, and suggested some mitigation techniques for each. The ‘families’ of cognitive biases identified were: Action-orientated biases – where decisions are taken quickly and less thoughtfully. Interest biases – which arise in the presence of conflicting incentives. Pattern-recognition biases – which lead us to recognise patterns where there are none. Stability biases – which create a tendency towards inertia in the presence of uncertainty. And Social biases – which drive a preference for harmony over conflict.
The utility of Lovallo and Sibony’s model is that it makes thinking about, and diagnosing, cognitive biases much simpler than trying to grapple with the large number of them that are known to exist. This then makes targeted mitigation measures easier to devise and implement. In the counter-terrorism example above, the Semmelweis Reflex is part of the Pattern-recognition family of biases, while Outgroup Homogeneity Biases are part of Social Biases. Lovallo and Sibony’s typology of cognitive biases opened the way for the creation of a simple on-line Cognitive Bias Test to measure the cognitive biases in individuals and in senior leadership teams. The test can be done in 20-30 minutes and results in proprietary Cognitive Bias Maps for each individual and for the group. The example below is the data for the CFO of a large multi-national. The maps are colour coded to illustrate the level of bias, with black, then red, being the most extreme, and green the least. The individual Cognitive Bias Map on the left is a powerful coaching tool. It shows that this executive’s primary biases are Pattern-recognition and Stability Biases. The map on the right shows the cognitive biases, which the group tends to exhibit while working together. Their main biases are Social, with moderately high Pattern-recognition Biases and Stability Biases. This particular combination leads to the ‘we’re in it already’ effect, where the group remains wedded to past decisions, with their debates tending to focus on justifying past choices rather than identifying and recognising mistakes.
The data shows that the CFO is an outlier on Social Biases for this team and, before the session to work on these biases was started, he was perceived as a trouble maker by the group. (His nickname, behind his back, was ‘Mr. No’). As soon as the group saw the results and understood the implications, they realised that the CFO was performing an invaluable function by challenging the group’s Social Biases during strategy meetings. Reviewing the data encouraged the group to identify ways of working that would further mitigate the effects of their biases. This had a lasting impact on the way that the executives worked together. A follow up interview with the CEO 12 months after the cognitive bias mitigation workshop revealed that the team were still starting strategic discussions by each member stating ‘My bias on this issues is…’. This is a highly-effective tool for both identifying cognitive biases and encouraging a group to mitigate them. The Cognitive Bias Maps, however, had another important implication for the CFO beyond identifying his own cognitive biases. The middle map shows his view of the group’s biases. While he clearly sees the high Social Biases that the group has, he under reports their Action-orientated Biases. Identifying these blind spots about the group’s biases forms another powerful coaching tool. In conclusion, cognitive biases exist in us all, and are there because the brain finds them useful – they are short cuts that save effort. The problem is that, over time, these short cuts generate cognitive biases. These are toxic to effective strategic leadership. Lovallo and Sibony’s research led to an easier way to classify the cognitive biases that affect strategic decisions in senior executives. That, coupled with the experience of diagnosis and specific mitigation techniques initially used in bomb disposal, has led to a simple test to measure cognitive biases both individually in senior executives and in senior leadership teams. This allows targeted mitigation techniques to be introduced. The mitigation of cognitive biases leads to clearer strategic leadership, creating the conditions for success in the organisation.
Few of us are called on to defuse a bomb. Learning to identify and control your cognitive biases may not save your life; but it may well save your company.
*William Shakespeare Anthony and Cleopatra