See More, Solve More

How does Mindset Influence Decision Making??

Here’s a scenario I’ve witnessed numerous times as an advisor to leadership teams facing inflection points, such as underperformance or the need to transform their business model.??Generally, the CEO is reaching the end of their patience with the lack of alignment and decision-making amongst the group.??Appeals that time is running out seem to create more panic and division. The CEO gathers the ‘inner group’ together, the people they believe in most, but it seems that shared clarity, commitment, and decisiveness are beyond even their grasp.??

There may be many things going on contributing to this stall point.??The number one cause is overload and the inability to manage the rising expectation of more for less.??There’s no time to think expansively, imagine new options, problem-solve, and make holistic decisions that stand the test of time. Instead, there’s an incessant drumbeat of short-term performance issues that need resolving that undermine a sense of control or that they can focus on the future.??Everyone discusses the need to prioritise, but each planning session underscores that there’s nothing to cut or deprioritise – the gloom intensifies.?

And there may be one of several dysfunctional team causes. A lack of ‘A’ players means several people are way out of their depth – everyone knows it, including them, but there’s insufficient trust, or time, to tackle the elephant in the room.??An individual may have a psychological makeup, such as narcissism, preventing the group from feeling safe to enter complex or unknown territory.??A long-running silent political battle may have been covered up so often that it’s too painful to discuss.??The leader might have blind spots in their self-awareness, undermining the group taking accountability for its actions. The list of possible dysfunctions is long. And?sometimes,?they are not the most helpful place to start. We’ve observed many seemingly dysfunctional groups achieve incredible things because they’ve worked on building a collective way of seeing the world that had the power to transcend these common human failings.?

It may be a truism, but judgement is the most important source of value creation. Bain and Co. suggest a 95% correlation with financial performance[i] . In research[ii] ?by McKinsey, only 20% of people think their organisations shine at decision-making. In ‘an average Fortune 500 company, this translates into more than 530,000 days of lost work - approximately $250 million of lost labour per year’.?

We’ve found another path through the turbulence that most leadership teams face today in delivering shared judgement. It goes beyond vague entreaties to build trust by working, from the ground up, to create a?shared?mindset.?

The new meaning of mindset is not simply about beliefs or the mental models we carry but the most fundamental way we make sense of ourselves, others and the world. By creating this shared understanding, teams can build mindsets that help them to feel, think and see together.?

Most leadership teams are not teams but reporting groups representing and often defending their functions. As a result, information and decisions are being viewed through a dozen different mindsets – marketing, sales, financial, strategic, customer and so on. Regardless of the clarity of strategic goals, these mindsets see the world very differently, removing any hope of true, deep consensus forming, particularly in uncertain circumstances where members retreat to the safety of their domain mindset.??To break this impasse, leadership teams need to build?shared?mindsets where they can bring their thinking together.?

We do this by building?mindset frames?that make explicit the information a particular mindset enables you to prioritise and the assumptions that mindset comes with.??

For example, in times of financial pressure, a team must move between value creation and efficiency frames to prevent short-termism from strangling the organisation’s future.??Shifting between these frames enables more creative problem-solving, fed by different information and assumptions. This allows the team to address paradox questions, such as ‘how can we grow?whilst?reducing costs’ rather than the zero-sum thinking that, for example, jettisons large numbers of talent, only to have to rehire it in 12 months.??Collectively switching and applying mindset frames allows a team to think and solve together.??Rather than competing frames stalling progress, they can see and solve more.??

[i] ?Blenko, M. and Mankins, M., 2010.?The Decision-Driven Organization. [online] Harvard Business Review. Available at: <https://hbr.org/2010/06/the-decision-driven-organization>?

[ii] ?Aminov, I., De Smet, A. and Jost, G., 2019.?Decision-making in the age of urgency. [online] Available at: <https://www.mckinsey.com/business-functions/people-and-organizational-performance/our-insights/decision-making-in-the-age-of-urgency>