Chapter 1 - Detecting and unveiling the Risk of Biased Decision-Making

As human beings, we often display impatience and a desire for quick results at the expense of long-term benefits. Short-term bias and fascination by buzzwords and shiny objects negatively influence investment decisions in an organization.

Human bias is a natural and expected phenomenon as it is innate to all human beings. Good leadership prioritizes improving biased decision making by emphasizing strategic thinking, long term planning, cross organizational collaboration and above all else — talent.

Having worked as a Data and Technology consultant over 10 years, below are some indicators that I utilize to evaluate if an organization is driven by biased decision making:

1. Lack of knowledge of employees’ skillsets, talent and career goals — A lack of focus on talent retention is an indicator that an organization is not prioritizing a long-term strategy and it’s instead focusing on showcasing value in short term.

2. Lack of understanding of ways of working and cooperation mechanisms across teams — When teams don’t understand how they can operate in the social network they often feel lost and confused.

3. High competitiveness, lack of collaboration and low risk tolerance — Due to the low emphasis on individual contribution and team partnership, employees tend to feel they are in competition with other team members.

4. Lack of transparency in funding decisions — Funding is often done in a fragmented way and employees will have limited visibility on how to influence funding decisions. Since funding drives innovation, this can limit the speed of innovation.

5. Lack of understanding of customer and customer needs — Due to the increased internal pressure and competition, employees will often forget that their ultimate goal should be to service the Customer and not themselves. The switch from “me” to “others” is easier in an environment where employees feel cared for and inspired.

6. Disproportional emphasis and investment in technology and AI as opposed to culture and people — When an organization is putting most of its resources (time and money) into the technology that will support analytics and AI and not in improving its culture and employee's talent we can suspect that it is being driven by biased leadership.

When an organization operates with a combination of factors described above, it faces potential repercussions that can prove detrimental, including:

• Fragmented work environment and dissatisfied teams — The prioritization of short-term needs often leads to different teams tackling similar initiatives, resulting in inefficiency and frustration among employees. Employees enjoy feeling that their work matters. When roles, responsibilities, priorities, and overall organizational structure are not clearly defined, it can demotivate employees who desire a sense of purpose in their work.

• Opportunity for toxic leaders to falsely claim credit for work they have not contributed to. Insufficient investment in training, work processes, and collaboration due to siloed teams enables toxic leaders to flourish. The absence of well-defined processes, strategy, and vision further empowers these individuals, which can have severe negative consequences for talent retention within the organization.

• Loss of organizational talent — When technology and immediate needs become the sole focus, talented employees become frustrated by the lack of overarching strategy, vision, and collaborative work environments. The recognition and promotion of toxic leaders at the expense of skilled and conscientious employees further erodes the organization’s human capital.

• Unbalanced power dynamics — Toxic leaders hold significant influence over employees due to the departure of talented individuals and their subsequent rise to power. This creates a breeding ground for individuals seeking power and territorial control to further thrive, while talent diminishes.

• Slow innovation — Contrary to popular belief, innovation thrives within well-structured organizations with motivated teams possessing the necessary skill sets to manage innovation effectively. Without such support, the organization becomes lost in a sea of unfocused investments across various areas, with little to no tangible outcomes. True innovation necessitates critical thinking and strategic decision-making, which in turn requires the presence of talent and long-term thinking.

• Lack of competitiveness — The organization’s inability to attract and retain talented individuals, combined with a stifled capacity for innovation, severely impacts its ability to compete effectively.

• Poor investment decisions and sunk cost fallacy — Leadership will prioritize investing in capabilities that promise to deliver short term value (such as fancy tools and AI promises) as opposed to preparing the talent that it’s required to make such decisions and carefully evaluating how those tools fit their current and future landscape. When the organization realizes that the investment does not offer long term return, the sunk cost fallacy slows down its ability to readjust to make better investments.

In the next Chapter, I will discuss how to move from a Biased Culture to a Network of People, Technology and Data by prioritizing investments in the right areas.