by Esther McVicar
Can there be respect for humanity during Change?
In article III, I discussed stress, how to identify it, and how to address it by putting people first. Today, I want to extend that knowledge to encompass change under the same conditions, and how we can adopt a people first strategy.
The operating context today is challenging. In the aftermath of a 1 in 100-year pandemic, economic uncertainty gained a foothold; the cost-of-living pressure has increased; natural disasters span the globe, and international conflict has raised its ugly head. Now, we must also realise the spectre of significant technological upheaval.
The era of Artificial Intelligence is upon us, and with it come seismic changes to how we will do business, be governed, educated, entertained, defended, and medically treated. In fact, almost every sector will be impacted. What does that mean for your organisation, and what does it mean for you?
Naturally, sentiments toward AI vary around the world. Positive sentiment seems to loosely correlate with government support for technology development, i.e., whether a national government has a technology development plan or strategy (IPSOS, 2022). Similarly, there seems to be a geoeconomic split globally, with developed nations less willing to embrace AI (IPSOS, 2022).
These results will be echoed in your organisation, with some embracing the change, and others suspicious, or even fearful. If we can understand these positions, we can help our organisations be more resilient in the face of this challenge, but also empower the people through taking a whole of person approach. So, lets break this down a little.
People in our organisations are not one-dimensional. What happens in our organisations happens in an open system and is influenced by what is occurring in our community both directly, and indirectly through the members of our organisations. These members have personal lives, work lives, and even virtual lives. So, when we think about respect for humanity, it needs to extend to include these other selves and how we relate to them.
The way we relate to one another in an organisation and consequently make decisions about change can be seen as the result of the combined effect of heuristics, cognitive bias, tribalism, and the reticular activation system (RAS) on our ways of thinking, and sense making.
How We Relate
Tribalism is the notion that within organisations there are groups, not necessarily aligned with organisational structure, that are at varying levels of interpersonal or psychosocial development. These groups share common values, world views, and behaviours. (Logan et.al.,2008).
These groups seem to follow natural variation, forming a bell-shaped curve. At the upper end we have a small number of fully self-actualised individuals, with the bulk of the population toward the middle levels (Logan et.al.,2008). It is important to note these varying levels do not denote superiority, or deficit, but rather reflect different life experiences (Medina, 2011).
These groups represent the lens through which members of an organisation receive and process information. In other words, we shape our world view, and in turn, it shapes us. Interestingly, understanding between these groups is hierarchical; we can only understand one level above us and one level below us (Logan et.al., 2008).
Personal growth facilitates movement between these levels, and comes with advantages for both the individual, in terms of self-actualisation, and the organisation. Once initiated, forward movement increases individual productivity, and it is cumulative, i.e., the more people you can have within one level of each other, the better communication and internal alignment (Logan et.al., 2008).
Therefore, knowledge of the tribes in an organisation greatly aids strategy formation and strategic alignment. In understanding the makeup of our organisation and using a whole of person approach to sponsor personal development, we can improve organisational cultures, increase organisational resilience, and increase productivity by up to 40% depending upon the number of level jumps individuals complete (Logan et.al., 2008).
How We Make Decisions
Heuristics are a mental shortcut we apply to help us quickly solve problems. They are pragmatic in nature, based on previous experience, or the experience of authority figures within our tribe or within one level of it.
Researchers have found there are three key types of heuristic; the first is the availability heuristic which is based on how readily an example comes to mind when making a decision, for example when thinking about change programs, if you can’t remember a successful change program, you will think they are all ineffective.
Similarly, the representative heuristic is used when estimating probabilities and is based on mental models, for example you may have had a manager in your early career that was older and conservative, thus your expectation of older leaders is that they are conservative regardless of how they behave.
The anchoring & adjustment heuristic occurs when individuals rely heavily on the first piece of information received when making a decision, for example when adjusting a process, the baseline metric sets the standard, and performance is judged in relation to that standard regardless of its validity (Kahneman et.al., 1982).
The good news is heuristics can be self-regulated, simply becoming aware of these mental shortcuts, helps us avoid them. In an organisational setting, rules and systems can be employed to help us consider an array of options to engage in active governance. Taking a whole of person approach to this strategy provides a contestable basis for decisions made, and facilitates more meaningful discussion, improving organisational relationships.
Heuristics, however, can turn into something more sinister, cognitive biases. These occur when we take the mental shortcut provided by heuristics, and consistently apply it to all situations developing a systematic pattern which transforms this rule of thumb into an observable habitual behaviour.
Cognitive biases are strongly correlated with strategic decision-making processes; however, studies have shown that simply changing decision-making processes did not rectify the problem, rather it resulted in the use of different biases (Das & Teng, 2002). There are currently over fifty identified and accepted cognitive biases, which due to their systematic nature, cannot be self-regulated. Correspondingly, the effect of bias on organisations is widespread and has potentially catastrophic implications for society.
Again, awareness of biases helps, however this awareness must exist beyond the individual, because modulation of this behaviour has an external rather than internal locus. Taking a whole of person approach means that skill analysis must extend to an individual’s tribal group to break the cycle of cognitive bias in decision makers.
However, cognitive bias can also be harnessed for good. There are six principles of influence; reciprocation; consistency; social proof; liking; authority, and scarcity which can all be linked back to identified cognitive biases (Cialdini,1984). These principles of influence can be used by organisations in a whole of person approach to encourage individuals to make more personally beneficial decisions, for example the principle of reciprocation is at the heart of sponsored executive coaching to encourage personal development.
Similarly, nudge economics also relies on positive use of cognitive bias, for example the need to opt out of wage insurance rather than opt in, in superannuation schemes, falls into the concept of benevolent libertarianism, where government and institutions nudge the populace to make personally beneficial choices they may not otherwise take (Thaler & Sunstein, 2008).
However, care must be taken to ensure appropriate individual agency is maintained, and options to opt out must be honoured. The system can’t ever evolve to the removal of individual agency, or the positive gains of the whole of person approach are lost.
How We Think
We have two systems for thinking. We access system one without conscious thought, it’s our everyday decision-making methodology. It is the way of thinking that is most swayed by cognitive bias, and is correlated with cognitive ease (Kahneman, 2013).
System two is more conscious and is the system we use for complex decision making. It is influenced by tribal group placement, and the RAS which you may remember from article III. However, system two is lazy, thus influenced significantly by heuristics. System two is also associated with cognitive strain (Kahneman, 2013).
Using a whole of person approach involves creating positive conditions and adequate organisational systems to encourage system two thinking. It must be noted that while neither thinking system is good or bad, in organisations conscious and deliberate decisions are favoured. Thus, punishment for making genuine mistakes should be minimised, since the conditions and organisational systems have not adequately supported the person in their endeavour.
How We Make Sense
Sense-making involves coming up with a plausible map of a shifting world, and testing this map with others, through data collection, action, and conversation; then refining the map or abandoning it depending on how credible it is shown to be. Our perceptions of credibility are shaped by our world view, our tribe, our system of thinking, but also the sensory information from our environment.
The RAS, a small structure on our brain stems, is one of the oldest structures in the brain and it is responsible for filtering all sensory information. The RAS is also responsible for consciousness, the flight, fight, or freeze response, and for flagging information that is interesting to us, or otherwise necessary for survival (Garcia-Rill, 2009).
This filtering mechanism itself is also shaped by our world view, and our perceptions of credibility in a self-reinforcing loop. What is interesting is the RAS can’t determine between an actual threat or a self-imposed one. So, we will behave the same way for a real or perceived threat (Schneider, 2017). It has been suggested that because of this behaviour, the RAS can be trained by matching subconscious and conscious thoughts through goal-oriented action (Dweck, 1989).
This facility for pre-conditioning the RAS is the basis for emergency training, where individuals go through the steps of an actual crisis event.
The reason these kinds of drills work is because in removing the unknown aspect of a crisis, we create an availability heuristic, which regulates the adrenal response triggered by the RAS in threatening scenarios. Less adrenaline means greater capacity for critical thought, and more propensity for system two thinking (Schneider, 2017).
Drawing these aspects together, we can see the importance of the whole of person model in how we think and how we make sense of the world around us. To create environments that promote system two thinking we need to help people in our organisation overcome the deleterious effects of their RAS, heuristics, cognitive bias, and tribal group.
Applying the Whole of Person Model to Change
In exploring how we relate to one another and consequently make decisions; this article reviewed the impact of four aspects of thinking and sense-making. In taking a broader view of the individual, and placing them within their entire context, of their work, personal, and virtual lives, a fuller description of the challenges to change implementation, particularly under stress, was uncovered.
The aspects discussed closely mirror change management theory which suggests that effective communication, development of individual and organisational capabilities, teamwork, socialisation, and sense-making are seen as critical to the effectiveness of change implementation (Rafferty et. al, 2013). The presence of these practices identifies what is known as change readiness in an organisation; however, these practices are noted to be difficult to quantify (Akmal et. al. 2022).
In review we can see that understanding affiliations within an organisation, indicates how information is filtered and tested. These affiliations are based on compatible worldviews which in turn shape the individual in a bi-directional system. To change this lens, one mechanism is to promote personal development.
Similarly, in understanding how we make decisions, we can apply organisational processes to encourage justification of decision-making which negates heuristic imbalance. Furthermore, in uplifting group capability, a mechanism for identifying cognitive bias in decision-making can also be applied.
An understanding of system one and system two thinking, illustrates how to create conducive environments for complex decision-making which can be derived at least in part by pre-conditioning of the RAS to create availability heuristics. This familiarity prevents overstimulation of the adrenal response, and the heuristic in turn can be addressed through organisational systems.
Fujio Cho said, “first we develop the people then we build cars” (Liker, 2004). Which is perhaps a much more eloquent portrayal of the influence of the whole of person model to organisational success.
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14.Thaler, R. H., & Sunstein, C. R. (2008). Nudge: Improving decisions about health, wealth, and happiness. Yale University Press.
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Esther McVicar is an experienced executive director and organisational systems specialist. A sessional academic at the Australian National University (ANU) and the Australian New Zealand School of Government (ANZSOG), she writes about the second pillar of Lean: Respect for Humanity.
Connect with her about Strategy, Risk, Governance, and Transformation on LinkedIn.