Management in perpetual Beta

“Our research indicates that, contrary to what one might assume, good analysis in the hands of managers who have good judgment won’t naturally yield good decisions.” — What Matters More in Decisions

Is it because they are assuming the problem is complicated …

Complicated, in which the relationship between cause and effect requires analysis or some other form of investigation and/or the application of expert knowledge, the approach is to Sense – Analyze – Respond and we can apply good practice.

… when in fact it is complex?

Complex, in which the relationship between cause and effect can only be perceived in retrospect, but not in advance, the approach is to Probe – Sense – Respond and we can sense emergent practice.

Our linear management models are based on people developing skills and expertise and over time moving up the organizational or disciplinary hierarchy. The higher up one goes, the greater the qualifications, and the better the compensation. These people are our experts.

One of the things that makes experts so convincing is that they exude confidence. They can talk calmly and knowledgeably about a subject, make reference to relevant facts and build a compelling logic for their case. A good expert is always impressive, but still usually wrong.

In fact, in a twenty year study of political experts, Philip Tetlock found that their predictions were no better than flipping a coin. Further, he found that pundits who specialized in a particular field tended to perform worse than those whose knowledge was more general. —Why experts always seem to get it wrong

Most expertise looks backwards. Experts develop case studies from their experience, and then best practices through reflection on these experiences. In a linear world, this is good. For complicated problems, reliance on experts usually works.

In a complex world, experts may inform our decisions but we should not rely on them. We need to try things out in context. Lots of things, lots of times, and with little fanfare. This is management in perpetual Beta. It means thinking for ourselves and developing our own expertise for our constantly changing environments. Getting current managers to understand and accept this is one of our major organizational challenges.
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