Recently, a wise man told me how after a few management books, most of them seem repetitive. I agreed with him lamenting a similar conclusion in my analysis of Personal Finance books. So, imagine my surprise when on my next visit to the American Library I came across a very promising book that talked about a very specific premise \u2013 how to make group decisions work better. I am happy to note that this weeks\u2019 book Wiser definitely did not disappoint.<\/p>\n\n\n\n
Wiser is a book co-authored by Cass Sunstein and Reid Hastie. For me, the name Cass Sunstein rung a bell as I realized that he was also the co-author on one of my favorite books covered here earlier, Nudge<\/a>. <\/p>\n\n\n\n Cass Sunstein was the Administrator of the White House Office of Information and Regulatory Affairs during the Obama presidency from 2009 to 2012. A lot of the insights derived in the book come from Sunstein\u2019s experience working at the White House and observing the processes of governmental decision making, which was most often done in groups. <\/p>\n\n\n\n On the other hand, Reid Hastie is a well-known scholar on decision making and professor of Behavioural Science at the Booth School of Business, University of Chicago. <\/p>\n\n\n\n How\nmany times have we used the phrase \u201ctwo brains better than one\u201d and well the\nnumber could go on increasing for all we know. Conventional wisdom suggests\nthat groups, especially after thinking and deliberation make better decisions\nthan an individual. However, in this book, the authors point out as to how\ngroups often end up intensifying the errors and biases of individuals as part\nof their decision making process.<\/p>\n\n\n\n What\nare the common mistakes groups end up making? How can you do better as a group?\nIs there a better way of making important decisions? Can crowd sourcing help\nand what should be the format of seeking that crowd sourcing? These are some\nquestions the book took to answering though at parts I got the feeling that\nthere was far too much attempted to be crammed in one tiny 214 page book. <\/p>\n\n\n\n Three\nbasic concepts of group dynamics stood out \u2013 complacency, anxiety and happy\ntalk. <\/p>\n\n\n\n Complacent people are the ones who are bubbly and excited in the confidence that everything will go alright and there is no hurdle to the project or the decision on hand. For them, the path of the decision is probably all bright, cheery and colorful with not an obstacle in sight.<\/p>\n\n\n\n As for anxious people, while they maybe genial people outside work, when it comes to decisions they are always on the lookout for the worst. They could be mistaken for pessimists but these are the people you need on any group. <\/p>\n\n\n\n Happy\ntalk can be seen more as a result of a group dominated by complacent people\nwith nobody willing to take up the mantle of anxiety on themselves. In some\nways, it\u2019s when a group is more concerned about getting along well and not\ntreading on any toes or rocking any boats and saying \u201cAll is Well\u201d. <\/p>\n\n\n\n If I had to mention the action points for the same, in short it would boil down to, complacency in groups is a problem, anxiety a necessity and happy talk needs to be tamped down on.<\/p>\n\n\n\n <\/p>\n\n\n\n As individuals, while\nmaking any decision, we are prone to certain errors and biases. Some of the\nbiases discussed by the authors are availability or recency bias (taking into\naccount recent events more than they warrant), representativeness (how we\nimagine something to look or be represented), framing (making different decisions\non how something is expressed) or the egocentric bias (believing that your\nopinion is correct). <\/p>\n\n\n\n While as individuals we\nmight be personally prone to some of the other error, if we see other members\nof the group deciding on similar lines, it acts as \u201csocial proof\u201d making us\nthink we must be right. While groups do better at reducing egocentric bias as\nwell as availability bias considering they tend to be subjective, constituting\na group from diverse backgrounds and mindsets could go a long way to reduce the\nprobability of such biases. <\/p>\n\n\n\n Cascade effect essentially\nrefers to the tendency of the herd mentality that we humans are prone to. It\ncan be seen best in cases where something goes viral. Think about Gangnam style<\/a><\/em> or\neven Kolaveri di<\/a><\/em>. I am\npretty sure they are not the best pieces of music but with cascading\ninformation they pretty much went off the charts. <\/p>\n\n\n\n There are two reasons for erroneous cascade effects \u2013 informational and reputational. In informational, the person who initially has a diverse opinion gradually starts to go along with the emerging viewpoint quite genuinely. As the authors point out \u201cpeople believe in wrong group decisions more than they believe in incorrect individual decisions\u201d.<\/p>\n\n\n\n To me, the reputational cascade effect seemed to be a far more dangerous trend. In this case, even if group members have a different opinion where they know or think they know the right answer which is different from the group, they remain quiet fearing a backlash or unfavorable opinion from the group. I believe this often happens in families too where dissent or differing opinions are not permitted. Probably communication of acceptance of such opinions and a feeling of security to all group members might help.<\/p>\n\n\n\n The authors cite a few studies to show how some groups started with more diverse and moderate opinions but after deliberation, they arrived at more of a consensus and more extreme opinions. While groups do need to arrive at a consensus, such polarisation of opinion could end up overlooking vital facts. The pre deliberation median of the group often gave a good sense of which way the group could end up being more polarised towards. So, if a group of 10 people has even 6 people with a higher risk appetite, post deliberation there is a high probability that the entire group has arrived at a conclusion that ends up taking a much higher risk. <\/p>\n\n\n\n I found the reasoning for this tendency of group polarisation quite interesting. The authors mention how, as individuals when we have an opinion, we could start out as being tentative and more moderate in outlook. But, when we hear other people in the group voicing an opinion similar to us, we get more confident and more extreme in our outlook leading to polarisation. As discovered by them, group polarisation had a higher probability in a close-knit group. Again a case for people from diverse backgrounds and even formal relationships for a group making important decisions. <\/p>\n\n\n\n I found this to be another\ninteresting aspect of why groups could end up choosing an inferior option. Most\ngroups end up discussing common knowledge held by all group members. There\ncould be two reasons for that \u2013 one, some group members have an inferior status\ngiving them lower confidence. This could be thanks to a lower designation in a\ncorporate setting or even a lower social economic status in something like a US\njury. Second, when you share information that others share or agree with, there\nis a higher probability of being liked. Even when making group decisions, it\u2019s\ndifficult to remember the objective of taking an optimal solution rather than\nhaving a bonhomie in the process.<\/p>\n\n\n\n While\nthe authors mention 8 ways of improvement, I was a little disappointed at how\nless the book was devoted to those. Also, since I am one for not spilling all\nbeans of a book in my post but keeping it to being a sampler, let\u2019s look at\nfour of my favourite ways.<\/p>\n\n\n\n Finally, it does boil\ndown to leadership, doesn\u2019t it? As I was discussing this book with my dad, he\ntalked about how in his experience he has mostly met leaders who love the sound\nof their voice and want to hear opinions that they anyway hold. Truth be told, I\nhave seen enough of those leaders in my short career as well.<\/p>\n\n\n\n However, if taking optimal group\ndecisions is part of a leader\u2019s agenda, inquisitive and self silencing might be\ntwo valuable assets in her or his arsenal. With inquisitiveness, you are\ninviting varied angles and aspects to looking at a particular problem which\ncould lead to something you hadn\u2019t thought of. As for self silencing, unless\nyou don\u2019t do that, how are varied opinions even going to come out? As the\nauthors point out, good leaders set out a clear agenda and then let the group\ntalk, choosing to speak last.<\/p>\n\n\n\n This suggestion\nessentially alludes to the fact that healthy dissent should be fostered in\ngroups. The authors cite a study where groups were primed for either \u201cgetting\nalong\u201d or for \u201ccritical thinking\u201d before getting into an exercise of making a\ngroup decision. Suffice it to say, groups primed for getting along did get\nalong well leading to more consensus, more polarization and sharing of common\ninformation. On the other hand, the group primed for critical thinking tried to\nthink of different aspects keeping in mind the objective of arriving at an\noptimal decision.<\/p>\n\n\n\n In this aspect, I quite liked this line from the book<\/p>\n\n\n\n In the United States, the highest-performing companies tend to have \u201cextremely contentious boards that regard dissent as an obligation\u201d and that \u201chave a good fight now and then\u201d<\/em><\/p>\n-Wiser, Cass Sunstein & Reid Hastie<\/cite><\/blockquote>\n\n\n\n It might not be very pleasant but it will be effective decision making.<\/p>\n\n\n\n This suggestion is one\nthat should really help cope with the common information effect in groups,\ndescribed above. The idea is that groups should be devised of members specializing\nin or holding certain roles that are clarified to the group. In that manner,\neach member is primed to think of that particular angle or area and other\nmembers primed to listen, respect and deliberate that part in the knowledge\nthat they might not know about that area.<\/p>\n\n\n\n This is probably why management\nconsultancies look for people with diverse backgrounds. The idea of cross\nfunctional teams in corporates of taking people from different business\nfunctions to work on a general project also derives from the same. However, the\nroles need to be made publicly clear to the group to foster proper exchange of\ninformation.<\/p>\n\n\n\n I found this to be a really good suggestion and in some ways, it leads from the idea that every group needs anxious people for optimal decision making. The idea is to designate one or a few people from the group as the red team to think up of and throw out ideas of why the plan may fail.<\/p>\n\n\n\n For instance, the group is responsible to come up with a product launch plan. After much deliberation, there is a plan. Now, you could either get a completely fresh perspective from an external red team or designate a few members from the same team to throw out possible red flags. In my opinion, external teams would probably work better considering they have not been a part of the deliberation and could see things very differently.<\/p>\n\n\n\n <\/p>\n\n\n\n The\nrest of the book talks about the instances where groups or large groups come\nhandy in making better decisions and how to harness it properly. Considering\nthis post is already way too long and I gotta leave some meat on that bone, if\ngroup decision making is something you encounter, this is one book you must read.<\/p>\n\n\n\n Have\nyou read the book? What did you make of it? Let me know in the comments below. <\/p>\n","protected":false},"excerpt":{"rendered":" Recently, a wise man told me how after a few management books, most of them seem repetitive. I agreed with him lamenting a similar conclusion in my analysis of Personal Finance books. So, imagine my surprise when on my next visit to the American Library I came across a very promising book that talked about a very specific premise \u2013 how to make group decisions work better. I am happy to note that this weeks\u2019 book Wiser definitely did not disappoint. About the Authors Wiser is a book co-authored by Cass Sunstein and Reid Hastie. For me, the name Cass Sunstein rung a bell as I realized that he was also the co-author on one of my favorite books covered here earlier, Nudge. Cass Sunstein was the Administrator of the White House Office of Information and Regulatory Affairs during the Obama presidency from 2009 to 2012. A lot of the insights derived in the book come from Sunstein\u2019s experience working at the White House and observing the processes of governmental decision making, which was most often done in groups. On the other hand, Reid Hastie is a well-known scholar on decision making and professor of Behavioural Science at the Booth School of Business, University of Chicago. The main premise How many times have we used the phrase \u201ctwo brains better than one\u201d and well the number could go on increasing for all we know. Conventional wisdom suggests that groups, especially after thinking and deliberation make better decisions than an individual. However, in this book, the authors point out as to how groups often end up intensifying the errors and biases of individuals as part of their decision making process. What are the common mistakes groups end up making? How can you do better as a group? Is there a better way of making important decisions? Can crowd sourcing help and what should be the format of seeking that crowd sourcing? These are some questions the book took to answering though at parts I got the feeling that there was far too much attempted to be crammed in one tiny 214 page book. Complacency, anxiety and happy talk Three basic concepts of group dynamics stood out \u2013 complacency, anxiety and happy talk. Complacency Complacent people are the ones who are bubbly and excited in the confidence that everything will go alright and there is no hurdle to the project or the decision on hand. For them, the path of the decision is probably all bright, cheery and colorful with not an obstacle in sight. Anxiety As for anxious people, while they maybe genial people outside work, when it comes to decisions they are always on the lookout for the worst. They could be mistaken for pessimists but these are the people you need on any group. Happy talk Happy talk can be seen more as a result of a group dominated by complacent people with nobody willing to take up the mantle of anxiety on themselves. In some ways, it\u2019s when a group is more concerned about getting along well and not treading on any toes or rocking any boats and saying \u201cAll is Well\u201d. If I had to mention the action points for the same, in short it would boil down to, complacency in groups is a problem, anxiety a necessity and happy talk needs to be tamped down on. Four common failures of deliberating groups 1. Amplification of individual errors As individuals, while making any decision, we are prone to certain errors and biases. Some of the biases discussed by the authors are availability or recency bias (taking into account recent events more than they warrant), representativeness (how we imagine something to look or be represented), framing (making different decisions on how something is expressed) or the egocentric bias (believing that your opinion is correct). While as individuals we might be personally prone to some of the other error, if we see other members of the group deciding on similar lines, it acts as \u201csocial proof\u201d making us think we must be right. While groups do better at reducing egocentric bias as well as availability bias considering they tend to be subjective, constituting a group from diverse backgrounds and mindsets could go a long way to reduce the probability of such biases. 2. Cascade effects Cascade effect essentially refers to the tendency of the herd mentality that we humans are prone to. It can be seen best in cases where something goes viral. Think about Gangnam style or even Kolaveri di. I am pretty sure they are not the best pieces of music but with cascading information they pretty much went off the charts. There are two reasons for erroneous cascade effects \u2013 informational and reputational. In informational, the person who initially has a diverse opinion gradually starts to go along with the emerging viewpoint quite genuinely. As the authors point out \u201cpeople believe in wrong group decisions more than they believe in incorrect individual decisions\u201d. To me, the reputational cascade effect seemed to be a far more dangerous trend. In this case, even if group members have a different opinion where they know or think they know the right answer which is different from the group, they remain quiet fearing a backlash or unfavorable opinion from the group. I believe this often happens in families too where dissent or differing opinions are not permitted. Probably communication of acceptance of such opinions and a feeling of security to all group members might help. 3. Group polarisation The authors cite a few studies to show how some groups started with more diverse and moderate opinions but after deliberation, they arrived at more of a consensus and more extreme opinions. While groups do need to arrive at a consensus, such polarisation of opinion could end up overlooking vital facts. The pre deliberation median of the group often gave a good sense of which way the group could end up being more polarised towards. So, if a group of 10 people has even 6 people with a higher risk appetite, post deliberation there is a high probability that the entire group has arrived at a conclusion that ends up taking a much higher risk. I found the reasoning for this tendency of group polarisation quite interesting. The authors mention how, as individuals when we have an opinion, we could start out as being tentative and more moderate in outlook. But, when we hear other people in the group voicing an opinion similar to us, we get more confident and more extreme in our outlook leading to polarisation. As discovered by them, group polarisation had a higher probability in a close-knit group. Again a case for people from diverse backgrounds and even formal relationships for a group making important decisions. 4. Crowding out of unshared information I found this to be another interesting aspect of why groups could end up choosing an inferior option. Most groups end up discussing common knowledge held by all group members. There could be two reasons for that \u2013 one, some group members have an inferior status giving them lower confidence. This could be thanks to a lower designation in a corporate setting or even a lower social economic status in something like a US jury. Second, when you share information that others share or agree with, there is a higher probability of being liked. Even when making group decisions, it\u2019s difficult to remember the objective of taking an optimal solution rather than having a bonhomie in the process. Four Ways of Improvement While the authors mention 8 ways of improvement, I was a little disappointed at how less the book was devoted to those. Also, since I am one for not spilling all beans of a book in my post but keeping it to being a sampler, let\u2019s look at four of my favourite ways. 1. Inquisitive and self silencing leaders Finally, it does boil down to leadership, doesn\u2019t it? As I was discussing this book with my dad, he talked about how in his experience he has mostly met leaders who love the sound of their voice and want to hear opinions that they anyway hold. Truth be told, I have seen enough of those leaders in my short career as well. However, if taking optimal group decisions is part of a leader\u2019s agenda, inquisitive and self silencing might be two valuable assets in her or his arsenal. With inquisitiveness, you are inviting varied angles and aspects to looking at a particular problem which could lead to something you hadn\u2019t thought of. As for self silencing, unless you don\u2019t do that, how are varied opinions even going to come out? As the authors point out, good leaders set out a clear agenda and then let the group talk, choosing to speak last. 2. \u201cPriming\u201d critical thinking This suggestion essentially alludes to the fact that healthy dissent should be fostered in groups. The authors cite a study where groups were primed for either \u201cgetting along\u201d or for \u201ccritical thinking\u201d before getting into an exercise of making a group decision. Suffice it to say, groups primed for getting along did get along well leading to more consensus, more polarization and sharing of common information. On the other hand, the group primed for critical thinking tried to think of different aspects keeping in mind the objective of arriving at an optimal decision. In this aspect, I quite liked this line from the book In the United States, the highest-performing companies tend to have \u201cextremely contentious boards that regard dissent as an obligation\u201d and that \u201chave a good fight now and then\u201d -Wiser, Cass Sunstein & Reid Hastie It might not be very pleasant but it will be effective decision making. 3. Role Assignment This suggestion is one that should really help cope with the common information effect in groups, described above. The idea is that groups should be devised of members specializing in or holding certain roles that are clarified to the group. In that manner, each member is primed to think of that particular angle or area and other members primed to listen, respect and deliberate that part in the knowledge that they might not know about that area. This is probably why management consultancies look for people with diverse backgrounds. The idea of cross functional teams in corporates of taking people from different business functions to work on a general project also derives from the same. However, the roles need to be made publicly clear to the group to foster proper exchange of information. Red teams I found this to be a really good suggestion and in some ways, it leads from the idea that every group needs anxious people for optimal decision making. The idea is to designate one or a few people from the group as the red team to think up of and throw out ideas of why the plan may fail. For instance, the group is responsible to come up with a product launch plan. After much deliberation, there is a plan. Now, you could either get a completely fresh perspective from an external red team or designate a few members from the same team to throw out possible red flags. In my opinion, external teams would probably work better considering they have not been a part of the deliberation and could see things very differently. The rest of the book talks about the instances where groups or large groups come handy in making better decisions and how to harness it properly. Considering this post is already way too long and I gotta leave some meat on that bone, if group decision making is something you encounter, this is one book you must read. Have you read the book? What did you make of it? Let me know in the comments below.<\/p>\n","protected":false},"author":1,"featured_media":652,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[552,586],"tags":[254],"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/elementummoney.com\/blog\/wp-json\/wp\/v2\/posts\/651"}],"collection":[{"href":"https:\/\/elementummoney.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/elementummoney.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/elementummoney.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/elementummoney.com\/blog\/wp-json\/wp\/v2\/comments?post=651"}],"version-history":[{"count":2,"href":"https:\/\/elementummoney.com\/blog\/wp-json\/wp\/v2\/posts\/651\/revisions"}],"predecessor-version":[{"id":2005,"href":"https:\/\/elementummoney.com\/blog\/wp-json\/wp\/v2\/posts\/651\/revisions\/2005"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/elementummoney.com\/blog\/wp-json\/wp\/v2\/media\/652"}],"wp:attachment":[{"href":"https:\/\/elementummoney.com\/blog\/wp-json\/wp\/v2\/media?parent=651"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/elementummoney.com\/blog\/wp-json\/wp\/v2\/categories?post=651"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/elementummoney.com\/blog\/wp-json\/wp\/v2\/tags?post=651"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}The main premise<\/strong><\/h3>\n\n\n\n
Complacency, anxiety and\nhappy talk<\/strong><\/h3>\n\n\n\n
Complacency<\/h4>\n\n\n\n
Anxiety<\/h4>\n\n\n\n
Happy talk<\/h4>\n\n\n\n
Four common failures of\ndeliberating groups<\/strong><\/h3>\n\n\n\n
1. Amplification of individual errors<\/strong><\/h4>\n\n\n\n
2. Cascade effects<\/strong><\/h4>\n\n\n\n
3. Group polarisation <\/h4>\n\n\n\n
4. Crowding out of unshared information <\/h4>\n\n\n\n
Four Ways of Improvement<\/h3>\n\n\n\n
1. Inquisitive and self silencing leaders<\/h4>\n\n\n\n
2. \u201cPriming\u201d critical thinking<\/h4>\n\n\n\n
\n
3. Role Assignment<\/h4>\n\n\n\n
Red teams<\/h4>\n\n\n\n