Managers make decisions about people based on gut instinct rather than objective data
David Woods, 16 February 2010
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3 comment's on this article.Seven out of 10 line managers doubt their decision-making capability when it comes to people management.
According to the results of a study by workplace psychologists OPP, 71% of all line managers would change the people decisions they've made if given a second chance. It's an indictment on the ‘gut instinct' culture that costs UK businesses millions of pounds in performance issues each year.
Nearly four in 10 (39%) line managers said they still rely on gut instinct as one of the most important factors when making any decisions about their people. A quarter also admitted that whether they like someone personally was also a major influence.
But people who had taken a psychometric test in the course of their career were twice as likely to find this kind of data important to them in making a range of decisions about people. This group is also much more likely to look for evidence in past behaviour than those who have not received feedback on a personality test in their career (68% vs 51%).
A major factor in this is managers' mistaken belief that they truly know their people - a view not shared by employees: 97% of managers feel they know their people fairly well or better; only 74% of workers agree with them.
Almost half (47%) of managers even say they know a great deal or everything there is to know about their people, while only 23% of employees share this view. Moreover, 45% said that they don't trust their manager's instincts on staff decisions relating to them or to others. The result is a workforce that is becoming increasingly distrustful of management decision-making.
Robert McHenry, CEO of OPP, said: "The results of this study make chastening reading for any management team. Organisations have to ask themselves why they demand objectivity and transparency in every other decision about resources, particularly in these difficult times when all investment is under scrutiny, but when it comes to people they allow themselves to ‘fly blind'? Managers are making the wrong people decisions more often than not, unable even to stand by their decisions after the fact. Mistakes range from overestimating the potential of a person to discovering information further down the line that would have changed the decision. In any case, these decisions are often made covertly and in the absence of hard facts.
"The economic cost of bad people decisions is well documented. Putting the wrong people in the wrong jobs has a direct impact on productivity and efficiency, and the cost of reversing the decision is often considerable.
"Management habits need to change. It's possible to obtain robust and objective information on which to decide. Considering proven, prior experience, data from psychometric testing and colleague feedback together creates a better foundation for these decisions. It's the best way for businesses to manage risk when it comes to their people, and it's a way that every CEO should demand."
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Peter Marno - 16 February 2010
The above is chastening - as it says. However it is likely to apply as well to decisions that are made about healthcare and how it affects the workplace. For instance it is not unusual for a manager to pronounce on an employee's illness and possible absence. As with employment where past performance and psychometric testing will allow good decisions to be made, so ill-health assessments and proper diagnosis will help make the right decisions about continuing employability. Such resources are normal 'tools' to help manage healthcare in the workplace.
Peter Marno
Management Consultant Corporate Healthcare
www.petermarno.com
Kate Sexton - 17 February 2010
Surely this 'gut instinct' decision making that is costing UK businesses millions of pounds each year is the result of the pressure people are under? Never before have businesses had to operate in such uncertain, challenging and complex environments.
Under pressure many people will make 'knee-jerk' decisions. They are in " survival brain mode". Their decisions will be unconsidered, inconsistent and may well put their career and/or business at risk.
The solution is to develop these people so that they understand their habitual patterns of decision making. Develop their capacity to lead others by increasing their emotional intelligence, their cognitive agility and their resilience. Then we will have managers who act with clarity, can critically examine their own decision making process, and operate with authenticity.
It's not the that the wrong people are in the wrong jobs necessarily, they just need some development. That is what every CEO should demand, surely?
Kate Sexton
Creative Edge Consulting Ltd
www.creative-edge-consulting.com
Claire St Louis - 20 February 2010
Trusting your gut has a value at work but in my experience you need high levels of emotional intelligence before you make truely good decisions based on instinct!.Working within the SME business sector, there are alot of business owners and managers out there who don't want to get tied down into tangible evidence. However when you show them how straightforward it is to collate this data and then combine the facts with the instinct - it has been like switching light bulbs on with some clients. I have no doubt that they are now making better and more informed decisions. So the answer could be to allow for instinct but make the evidence easier to accumulate so that we overcome our fears of data and still allow for our own human feelings too!
Claire
www.libbeyhr.co.uk
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