Saturday, April 28, 2012

Internal Tension: Compliance v Entrepreneurialism

I was talking to a CEO the other day who wanted his people, particularly his senior managers to 'stand on their own two feet' as he put it. In short he wanted his people to become more entrepreneurial, creative, innovative and to be better critical thinkers. This is probably one of the more common requests I get in terms of senior management development and is a core activity of mine as it has at it's heart the ability to deal with ambiguity.

Successful acts of innovation, creativity and entrepreneurialism in particular are defined by the individual's ability to hold, cope and be persistent in situations that are highly ambiguous. Few true entrepreneurs create businesses using a step-by-step 'it's all mapped out' approach. Rather they feel their way forwards, frequently changing direction, often changing their business to meet prevailing conditions and succeed.

For example an indian restaurant set up in an out-of-town cinema complex just outside Oxford about five years ago. It was designed as a high end, sophisticated and elegant eatery. The business struggled for years. The problem is the restaurant is in a concrete cinema complex right next door to a very popular 'eat-as-much-as-you-want' fixed price chinese buffet. The chinese buffet would have queues outside whilst the indian was empty. A quick look in the vast car park outside was all the data you needed about the socio-economic profile of the typical customer to the complex, these are certainly not high end vehicles. As they say, necessity is the mother of invention. After struggling for years the business changed tack and is now an eat-as-much-as-you-want fixed price indian buffet. It is now a popular business with a reasonable turnover. They changed their business strategy, (eventually) and appeared to have saved they day.

The problem, in many organisations and companies is that most managers grow up and are promoted for compliance and regulating people, not for being maverick agents of innovation and change. Most organisations require layers of agreement (and meetings) for any change to occur. Being a creative and innovative entrepreneur, in many organisations is a bit like trying to melt an iceberg with the aid of a soggy box of matches.

So, can you change someone from being an agent of compliance into an entrepreneurial being. The short answer is yes, in many (not all) cases. However if the organisational systems promote compliance and regulation this is very hard to achieve and will certainly create 'drag' in the entrepreneurial aspirations of the company.

Monday, April 23, 2012

The Psychology of Ambiguity 3: Availability cascades

One of the issues most people face when they have to deal with an ambiguous situation is separating out new world facts and beliefs from old world facts and beliefs.

A new world fact is a new truth that has come about because of a change.
An old world fact is a truth that was considered to be true before the change, but is no longer true as a result of that change.

When a change occurs it takes time

  1. for the change to be noticed, and
  2. for the new rules or facts / beliefs to become obvious.
As a result of this lag many people continue to believe in the old world rules and facts even though they no longer apply. 

As these old rules and facts usually still have popular currency they can grow in strength in times of change even though they have now been replaced or changed. 

An availability cascase is a psychological phenomena whereby a belief gains increasing credibility the more popular it becomes and the more we hear about it. If we start to hear about something from a number of different sources we are much more likely to believe it even if it is no longer true. In effect the facts become self-reinforcing. 

Some common popular misbeliefs brought on by an availability cascade would include things like:

  • Shaving causes hair to grow back thicker and stronger. It doesn't.
  • Men think about sex every seven second. It has never been measured.
  • Sugar causes hyperactivity in children. There is no scientific evidence for this. In fact double blind experiments have shown no change in behaviour.
Have a look at the wikipedia list of common misconceptions most of which have been brought about by availability cascases. This effect is even more pronounced in ambiguous situations.  

Sunday, April 22, 2012

Motivate or Manipulate?

I was running a workshop for managers last week and as often happens in leadership and management courses, a discussion ensued about how to motivate people. As the discussion developed it became increasingly clear that some of the managers, whilst using the term 'motivate others' they actually meant 'manipulate others' into doing things they don't want to do through some form of systematic reward and punishment protocol. The real question was "How do I get people to do what I want them to do".  This often also means "How do I force people to do what I want them to do?"

So I thought I would do a short blog on 'motivation' to highlight the difference between motivation, manipulation and using force of any nature, including rewards and punishments.

My first question is: "What does it feel like to be genuinely motivated to do something?"
Yes that feeling; the excitement and drive. The sense that you really want to do this, often regardless of some extrinsic (external) reward.

My next question is: "What does it feel like to be forced or manipulated into doing something?". Quite a difference my guess is.

It turns out that there are some core factors that create a motivated state:

The main contributing factor to becoming motivated is that the task has to be meaningful to the individual. So what makes something meaningful?

  1. External Validity. Firstly the task has to make sense to the individual on the level that they know how it fits into or contributes to the advancement of some goal. they actually agree with. This may of course include a personal goal such as promotion or inclusion in a CV for example.
  2. Global Validity. If the task passes the individual's external validity test, the task then has to have global validity in that the individual has to believe that this is a good and valid thing to do to. In other words is a worthy cause or goal? Is what they are about to contribute to valued by them.
  3. Internal Validity. Thirdly the individual has to understand what to do and how to it, and feel that their skills and knowledge (expertise) is being utilised correctly and are valued. Basically that they are not being used.
  4. Enjoyment. Lastly will they either enjoy doing it, or enjoy having completed the task, or enjoy the kudos of having been part of the process?

Friday, April 06, 2012

The Psychology of Ambiguity 2: Ambiguity Bias

You have a choice. You are at work and you have to make a business decision between 3 options each of which will take the same effort:
Business Option 1 will almost certainly make you $10,000. It is quite likely (over 80% probability) this option will work and you will make the money.
Business Option 2 could make you $20,000. However you no idea what the probability of this option working is.
Business Option 3 could make you anything. You don't know how much it might make or what the probability is that it will work.

You have to make a decision right now or option 1 will disappear. Which option would you take and why?

The Ambiguity Bias or Ambiguity Effect is a bias where people are affected by the lack of information or the amount of ambiguity inherent in a situation. In other words most people tend to prefer known situations even though they might not be the most advantageous. People tend to prefer certainty over ambiguity.


Baron, J. (2000). Thinking and deciding (3d ed.). New York: Cambridge University Press.
Ellsberg, D. (1961). Risk, ambiguity, and the Savage axioms. Quarterly Journal of Economics, 75, 643–699.Frisch, D., & Baron, J. (1988). Ambiguity and rationality. Journal of Behavioral Decision Making, 1, 149-157.Ritov, I., & Baron, J. (1990). Reluctance to vaccinate: omission bias and ambiguity. Journal of Behavioral Decision Making, 3, 263-277.Wilkinson, D.J. (2006). The Ambiguity Advantage: what great leaders are great at. London: Palgrave Macmillian.

Wednesday, April 04, 2012

The psychology of Ambiguity 1: Cognitive Dissonance

How do you react when faced with something that you don't understand and appears to conflict with what you already believe or understand to be the case? 

I was recently working alongside some emergency service leaders during a live incident (live coaching). One leader (Silver) was faced with a sudden and unexpected crowd of people moving into an enclosed area within which an operation was was taking place. As far as everyone had been informed this area was secure and no one, let alone a crowd should have been able to access it.  The commander on the ground (Bronze) informed Silver (our leader) that approximately 40-50 youths had entered area without warning and the officers on the operation were facing public order situation on top of the existing operation that they were trying to execute. The Bronze commander asked Silver if they should abort the operation as they were heavily outnumbered. 
The Silver commander, who had planned the operation realised that if they withdrew they were unlikely to be able to go back at a later date and execute the operation. In short the operation would fail. 
He decided to order that the officers on the ground should continue as planned. 

This is a classic case of the psychological phenomenon of cognitive dissonance occurring in an unexpected ambiguous situation.  

Cognitive dissonance occurs when there is a discrepancy between what a person believes, knows and or values and external evidence that is contrary or calls into question their internal beliefs, knowledge, experience or values.

This discrepancy between the internal and external state creates psychological and emotional discomfort, or dissonance. The mind then works to adjusts inorder to reduce the discrepancy and create order out of ambiguity. In many cases it does this by ignoring or reducing the importance of the external data and going with their existing beliefs, knowledge, experience or values as occurred in this situation. 

Such a reaction maintains the principal known as cognitive consistency and reduces the cognitive dissonance. This is a typical reaction to ambiguity, especially under stress. 

The outcome of the above situation is that the Bronze commander followed orders, the incident got out of hand, the operation failed badly and a number of officers and youths were injured, 4 seriously.