Illusory Management: I

Among the many goals of managers is controlling organizational performance. The people of the organization, for the most part, hope and believe that their managers will effectively guide the organization through or around the difficulties the organization faces on the way to achieving its objectives. To help managers accomplish this feat, the people the managers manage keep their managers informed about the status of their activities. And managers provide the people they manage with resources and information to help them do their jobs. Managers don't tell their people everything they know, of course. But managers do tell their people what they believe their people need to know. Resources and information provide all the tools managers need to control the organization's course to reaching its objectives.

To fully appreciate the depth of the gulf between the stories we tell ourselves and the reality of Management's limited capabilities, consider the factors over which Management has relatively little control.

Laws of Nature

We aren't usually aware of the constraints Nature imposes on our work, until Nature makes ignoring Nature impossible. For example, we cannot have more people on a team than the space we occupy can support. Or we cannot display more people on a video call than our screen size will support. Or we cannot control the time difference between Mumbai and Singapore.

Laws of Nature The gulf between the stories we tell
ourselves and the reality of management's
limited capabilities is deep and wideconstrain, among other things, how fast we can do our work. For example, if the closed-loop communication time between two sites of a virtual team is 18 hours, exchanging information between them will be slow.

Laws and regulations affecting organizational activities

Local and national laws and regulations in jurisdictions in which the organization operates can affect organizational performance. The usual effect is hindrance, rather than advancement. Management can control how well and how quickly it understands and responds to these effects, but its control over the laws and regulations can be somewhat limited.

Consider, for example, the need to file financial reports by certain dates, usually quarterly or annually. These activities impose periodic load spikes on the finance department workforce, as one might expect. But they also bias decisions that have financial impact. The bias is in favor of decisions that have positive effects on short-term financial performance. Those decisions might not be well aligned with the long-term health of the organization.

Cost of solving problems

The scales of resources expended on solving problems are difficult for Management to predict or control. The problem solving teams usually do a better job of predicting these quantities.

Management would be wise to rely on the expert opinions of the problem solving teams. Too often, though, Management allows its wished-for projections to influence its judgment of the validity of the projections experts provide. And this bias creates pressure on the problem-solving teams to deliver projections that are consistent with management preferences.

The personal lives of the people of the organization

The inability of Management to control laws of nature, laws and regulations of governments, or the costs of solving problems can lead to an urge to compensate by imposing on the lives of the organization's people. These compensations take the form of extended work hours, limited compensation and benefits, forced relocations, inadequate equipment or software, and crowded, dangerous, or unhealthy working conditions.

Although these compensation tactics seem to be effective in the short run, they lead inevitably to increased workforce volatility, organized resistance, compromised output quality, and legal tangles. The costs associated with these effects can exceed the saving sought by employing the tactics that cause them.

Clearly there is much about the organization that is beyond Management's ability to control. Why then is our regard for their ability to control the organization so wrong? One part of the answer is a cognitive bias known as the illusion of control. But as we'll see next time, that cognitive bias is just one element of a complex array of devices that cause us to overestimate our own — or anyone else's — ability to control organizational performance.  Next in this series  Top    Next Issue

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