I have always been fascinated how certain biases and bad habits can influence our better judgement. Over the past 50 years, psychologists have identified numerous “hidden traps” that derail good decisions, whether they’re made by leading business executives, political leaders, or consumers while shopping. Many can be traced to certain mental shortcuts that we use every day to manage life’s challenges – these rules of thumb we apply unconsciously because our brains, unlike those of ants or birds, weren’t designed to tackle problems collectively.

Below are three examples of psychological traps that influence our decision making:

1. Anchoring Trap

“Anchoring” results from our tendency to give too much weight to the first thing we hear.

Q1: Did Jeremy Lin score 20 points yesterday against Miami?
Q2: What’s your best estimate of how many points Lin scored?

Chances are, when you answer the second question, you’ll be basing it on the first. If the number in the first question was 60 points, your answer to the second one would be significantly higher. Anchoring is used a lot in “As-Seen-on-TV” commercials. The announcer always starts with the question, “How much would you pay for this (crappy product)?” “A hundred dollars? Two hundred? Call now and pay only nine ninety five.”

2. Status Quo Trap

The “status quo” trap stems from our inner preference to not rock the boat. All things being equal, we prefer options that keep things the way they are, even if there’s absolutely no logic behind that specific choice.

The status quo trap is quite rampant in the public sector (i.e. federal government) particularly organizational cultures that do not encourage change. When employees are not rewarded to take risks but are penalized for unfavourable outcomes, they choose to stay with the tested-and-tried way of doing business, even if the current process is both inefficient and ineffective.

3. Sunk-Cost Trap

The sunk-cost trap results from choosing courses of action that justify your earlier decisions. The end result typically creates what is known as commitment bias, where you can’t change because you’ve already put too much skin in the game, so to speak.

For example, you may have recently hired a new person for your team, and shortly thereafter realize they are incompetent, but instead of cutting your losses you decide to keep him/her because you’ve already invested considerable time on them, and it would look bad in the eyes of your boss. But the longer we let the problem drag on, the worse it can be for everyone.

There have been many articles written on this subject, but I still find myself making these mistakes. It’s important to uncover “errors in thinking before they become errors in judgement”.

Want to learn more?

Please consider reading this classic article on “The Hidden Traps in Decision Making” from the Harvard Business Review.

I’d also recommend the book called “Smart Swarm” by Peter Miller. It’s a detailed look at swarm intelligence. How animal behaviour through self-organization, indirect collaboration, and adaptive mimicking has evolved over millions of years to tackle even the most complex issues.

I want you to do a quick mental exercise. Think about your conversations over the past six (6) months, but only focus on the individuals that consistently gave you their full, undivided attention.  Take a few moments.  These individuals were genuinely interested in what you had to say.  They made you feel like each conversation you had with them, at that particular moment, was their only priority.  In my case, I could only think of a handful, but these individuals certainly did have one obvious commonality — they are all great listeners.

Listening is an Acquired Art

Distinct from hearing, which is innate, listening is an acquired art — and a very strategic one at that. Listening is both fact-finding and intelligence-gathering from clients, customers, stakeholders, and the employees who are on the front lines of the marketplace.  Yet, it is priceless to the person to whom you are listening, and the skill is absolutely essential for you, as manager and as an individual, both in your professional and your personal life, to be truly effective.

Being a good listener actually attracts people to you. Everyone likes talking with someone who makes them feel heard. The more people who are willing to speak with you, open up with you, the more opportunities (social opportunities, life opportunities, work opportunities, etc.) will come your way.  Good listeners have a competitive advantage: they get promotions, they are more frequently selected for leadership positions, and they are often better informed because of their ability to build trust.

Listening Aids Customer Experience

When customers feel listened to, valued, and important to a company, it’s rare. That’s because great service and effective communication are more than a set of skills. It’s a cultural mind-set of respect and accountability where you do what you say you’re going to do for the customer.  Zappos truly models that mind-set, and it’s part of the reason that their customer experience is so exemplary.

Lastly, it is always necessary to remember that the purpose of listening is to understand; it is not intended just for the sake of being able to answer or reply to someone. Therefore, one must always be open to the ideas and information being conveyed, and avoid the tendency to make assumptions and generalizations.  With that being said, listening is, and will continue to be, the language of leaders.

Dr. Stephen Covey, mentioned in the video below that, when you “really listen to another, in-depth, until they feel understood, you are communicating their worth, their potential”.  People appreciate, respect and value others who are great listeners.  I know I certainly do.

Rock climber Yvon Chouinard is credited with making Patagonia one of the most remarkable sportswear companies in the world. His vision drove a corporate culture of environmental activism that is chronicled in the book Let My People Go Surfing. 

TOMS Shoes, is looking to revolutionize how we look at corporate culture in the future. They are championing the idea that a company can sell a quality product, be profitable, and give back to those in need.  I can only hope that they will inspire other companies to do the same.  In the picture on the right, Zappos defined its company’s culture via ten core values and each year they even publish a “Culture Book”.

Decisions.. Decisions..
So, what does it take to create the right kind of culture?

How can you maintain that culture? During the process of defining your corporate values, you must align your culture with ethics.  It’s important to recognize that business leaders will encounter dilemmas in their decision-making process when values collide. For instance, on what do leaders base their decision when no matter what they decide, the outcome may have undesired consequences? It is important to stress immediately that there is no single and universally accepted rule, or set of rules, that one can use. However, as a general rule-of-thumb on whether a particular decision, option or course of action is ethically acceptable, leaders can ask themselves if the intended action is consistent with the accepted values, strategy, and history of the company.

To make it easier, I’ve put together a quick five-stage process for ethical decision-making.

1. Perceive the problem and consider the obligation to act.

2. Evaluate the problem (that is, what are the issues, what are the facts?).

3. Make a decision (choose the best option with due consideration for the rules, values, consequences, and care for others).

4. Implement and accept responsibility for the decision.

5. Monitor and adjust.

The first stage is certainly the most important. If leaders do not perceive an ethical dilemma or problem, then they will not attempt to address or solve it. Once the problem has been perceived, the leader must spend some time evaluating it and exploring various solutions, and only then make and implement a decision. Employees always need to be current on what the companies problems are and then constantly encouraged to help solve them.

Creating the right company culture is hard but invaluable.  A business is all about making decisions, good or bad, those decision will effect how your company is perceived both internally and externally.  High performance culture where employees get great feelings of:  significance, connection and certainty will serve to unify and energize the company and its employees.

Remember, your culture is your brand and the bottom line of a business is its people.  The decisions you make, must be consistent with your corporate values.

Below is an article my sister put together for her Woman in IT Leadership group

She provides a unique perspective on 5 specific challenges that women may face while trying to advance their career.

To me, leadership equals inspiration, delegation, collaboration, influence, respect, knowledge, and continual learning, the ability to:

-Inspire my team and those around me to be enthusiastic and engaged in moving toward a common goal

-Delegate to and trust my team

-Collaborate and share knowledge so that my team and those around me have opportunities for growth – to fill my shoes

-Influence the influencers

- Respect others and earn their respect

- Know when to lead and when to get out of the way

- Make continual learning part of my leadership journey

What is different about women in leadership?  Or leadership in a technology field? Or both?

Women often have a taller mountain to climb to advance their careers in the technology industry as there are few women role models they can strive to emulate. Even as natural leaders, many women often do not know that they are leaders or they don’t know how to climb the rungs of the tech ladder to leadership positions. Those that have often mark the sacrifices they have made to get there, both professional and personal, and you often hear that they had to “fit” into a male IT world to advance.

One of the great qualities of women leaders is that they often tend to cultivate relationships through collaboration and team-building, with less emphasis on hierarchy and status.

What are specific challenges that women in technology leadership face?

1) The “too-nice” challenge — you get taken advantage of by supervisors and your team because you always apologize even when it’s not your fault and you let rules be broken continually

2) The “door always closed” challenge – you’re so deep in your work that you don’t take a moment to check how those around you are doing only to realize that they’ve all left

3)The “claws are out” challenge – you show strength of character and authority and instead of earning respect for your decisiveness and directness, you get the tiger cat call

4) The “burn-out” challenge — you say yes to everything and everyone, and before you know it you don’t have time to eat or sleep

5) The “gone fishing” challenge — you are away for an extended period and come back to work only to find out that an opportunity has passed or the re-learning curve takes a long time to get back into the swing of things

What are specific skills or personal development to arm yourself for the future in technology leadership?

Negotiation skills and conflict resolution are critical skills for career advancement, and having the ability to manage remote and multifunctional teams using technology as a tool for communication is becoming evermore prevalent and essential.

If you enjoyed this article or have some comments, please send them my way – I’m always more than interested in hearing from you.

One of the biggest problems facing poor leadership, and possibly the most significant reason we are stuck with it, is that so many of us are prepared to tolerate – or even support – those who are not fit to lead. “The reason we do so”, says Peter Drucker, “is that it is easier to toe the line than to make trouble”.

Another reason that many of us are happy to follow people for whom we may hold little respect is that we tend to crave the kind of simplicity and stability that does not go with the responsibilities of leadership.

When management tends to focus so much on one management area, e.g., sales, and has no time to manage the internal organization challenges, dysfunction creeps in and takes hold. Here is a great checklist of warning signs of poor leadership from the International Institute of Management.

No 360 Degrees Feedback: There is limited or no leadership performance feedback.

Personal Agendas: Recruitments, selections and promotions are based on internal political agenda, for example hiring friends to guarantee personal loyalty at the expense of other highly performing and more-qualified employees.

Inefficient Use of Resources: Budgets are allocated between business units or departments based on favoritism and power centers rather than actual business needs.

Empire-building Practices: Managers believe that the more people they manage and the bigger the budget, the higher the chance that they will be promoted. This results in raging battles around budgets, strategies and operations.

Unequal Workload Distribution: You’ll find some departments are underutilized while other departments are overloaded.

Too Much Management: There are many management layers in the organization, thus, hindering communication and resulting in slower execution.

Fragmented Organization Efforts: Interdepartmental competition and turf wars between rival managers lead to the emergence of silos, which results in communication gaps. Management silos almost always result in fragmented and duplicated budgets and projects, thus wasting valuable company investments.

Too Much Talk: Plans are heavy on talk but light on action. In a political corporate culture, image management becomes far more important than actions.

Ineffective Meetings: Argumentative and heated cross-divisions meetings with discussion and language focusing on point scoring and buck-passing rather than sharing responsibility and collaborating to solve the problem

Lack of Collaboration: Every person for himself/herself. Low sense of unity or camaraderie on the team. The key criterion for decision-making is What is in it for me?

Low Productivity: Management wastes more time and energy on internal attack and defense strategies instead of executing the work, innovating and overcoming challenges. Critical projects fall behind on deadlines, budgets and performance targets (e.g. sales, market share, quality and other operational targets).

Constant Crisis Mode: Management team spends most of their time on fire fighting instead of proactive planning for next-generation products and services.

Morale Deterioration: Muted level of commitment and enthusiasm by other teams. Even successful results cannot be shared and celebrated due to animosity and internal negative competition.

Backstabbing: Backbiting among the executives and managers becomes common and public.

Highly Stressful Workplace: There is a high rate of absenteeism and a high employee turnover rate.

Dictatorial Leadership: Management that does not allow disagreements out of insecurity or arrogance.

Poor leadership is undoubtedly one of the main potential factors that can lead an organization to fail.  Pay attention to the warning signs, be proactive and hopefully, the elephant leaves the room.