Pharmaceutical Executive Digest Europe - February 18, 2009 - (Page 11) Exposing Executive Bias The way we explain things to ourselves helps explain executive behaviour, says Dr Brian D. Smith ome executives perplex me. One recently explained to me the problem of getting investors, in the current climate, to fund his embryonic start-up. He would give anything for a good answer, he said, as his business depended on it. I felt good therefore to have something useful to tell him and began my 30 second “elevator description” of my work into the link between strategy and shareholder value. He cut me off after about 10 seconds, saying that if he couldn’t fit it on one PowerPoint slide, he wasn’t interested. I bit my tongue. As I drove home from the conference, I tried to fathom his behaviour and Attribution Theory popped into my head. Developed by Fritz Heider1 and his colleagues, this is an important piece of social psychology research. Heider et al’s work and that of their followers describes how individuals ‘attribute’ causes to events and how this cognitive perception affects their usefulness in an organisation. S In short, people tend to explain that the reason things happen is as a result of external factors (the weather, the market) or internal factors (their abilities). The impatient executive was attributing success or failure at attracting investment to ‘the market’ and wanted to know where to look, not what to do. This is because, as attribution theory tells us, we act in order to preserve our own positive self-image. He lacked knowledge about strategy and finance, but didn’t want information that reminded him of that. …as attribution theory tells us, we act in order to preserve our own positive self-image. Like many management theories, this theory has important practical implications for executives. We all depend on others to explain why, say, a product launch succeeded or failed, or why a team isn’t working. We’re instinctively aware that we should allow for the bias of the explaining manager, but knowing how to do that effectively is another matter. Attribution theory helps here. If I know that a sales director, for example, sees himself as a good leader of people, then I can balance this against his explanation that his performance problems are down to one or two individuals. His discounting of leadership explanations is an attribution bias. In the same way, the marketing director of a recent company I was researching explained their success as a result of their branding strategy. The hard data indicated that they had just rode a rising market, no more than that. The internalisation of the explanation was an example of attribution theory in practical action. Of course, many readers will look at this and say it’s a statement of the obvious. Of course people bias things to make themselves look and feel good. But there’s much more to attribution theory than that. For example, the stability of the explanation helps us decide whether we can generalise lessons from one experience to another. The point, as ever with management theory, is that knowing a little about the theory is helpful, but knowing it in depth can be extremely powerful in practice. Unless, as many executives think, success has nothing to do with theory and is entirely down to what you do, whilst failure is always someone else’s fault. And if that’s what you think, then you’re an excellent case study in attribution theory all by yourself. Reference 1. Fritz Heider, The Psychology of Interpersonal Relations (New York, John Wiley & Sons, 1958). 1 7 NEWS VACCINES 2 11 FROM THE EDITOR / NEWS STRATEGY 5 CALENDAR 6 BRUSSELS REPORT 12 ONLINE NETWORKING 15 ON THE MOVE
Table of Contents Feed for the Digital Edition of Pharmaceutical Executive Digest Europe - February 18, 2009 Pharmaceutical Executive Digest Europe - February 18, 2009 Contents From the Editor News Calendar Brussels Report Vaccines Management Theory Online Networking On the Move Pharmaceutical Executive Digest Europe - February 18, 2009 Pharmaceutical Executive Digest Europe - February 18, 2009 - Contents (Page 1) Pharmaceutical Executive Digest Europe - February 18, 2009 - From the Editor (Page 2) Pharmaceutical Executive Digest Europe - February 18, 2009 - News (Page 3) Pharmaceutical Executive Digest Europe - February 18, 2009 - News (Page 4) Pharmaceutical Executive Digest Europe - February 18, 2009 - Calendar (Page 5) Pharmaceutical Executive Digest Europe - February 18, 2009 - Brussels Report (Page 6) Pharmaceutical Executive Digest Europe - February 18, 2009 - Vaccines (Page 7) Pharmaceutical Executive Digest Europe - February 18, 2009 - Vaccines (Page 8) Pharmaceutical Executive Digest Europe - February 18, 2009 - Vaccines (Page 9) Pharmaceutical Executive Digest Europe - February 18, 2009 - Vaccines (Page 10) Pharmaceutical Executive Digest Europe - February 18, 2009 - Management Theory (Page 11) Pharmaceutical Executive Digest Europe - February 18, 2009 - Online Networking (Page 12) Pharmaceutical Executive Digest Europe - February 18, 2009 - Online Networking (Page 13) Pharmaceutical Executive Digest Europe - February 18, 2009 - Online Networking (Page 14) Pharmaceutical Executive Digest Europe - February 18, 2009 - On the Move (Page 15)
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