Organisational (Notes) MBA Executivo

January 2nd 2014

Behaviour
COGNITIVE BIASES & DECISION MAKING
Decision Making Model (Classical Economic Theory)
The rational decision-making model is useful in guiding our approach to decision-
making, but it does not work perfectly or predictably, because the context of most
decisions is seldom so simple or so rational.
Steps:
1. Recognize and define the problem;
2. Identify the objective of the decision & the decision criteria;
3. Allocate weights to the criteria;
4. List and develop the alternatives;
5. Evaluate the alternatives;
6. Select the best alternative;
7. Implement the decision;
8. Evaluate the decision.

Bounded Rationality Theory (Simon, 1945, 1977)

People are restricted in making decisions and settle for less than ideal
solutions.
Bounds or limits to rationality:
• Selective Attention;
• Incomplete Knowledge;
• Incomplete survey of alternatives;
• Satisficing.

Heuristics
Heurística é um método ou processo criado com o objetivo de encontrar soluções a um
problema. É um procedimento simplificador (embora não simplista) que, em face de
questões difíceis envolve a substituição destas por outras de resolução mais fácil a fim
de encontrar respostas viáveis, ainda que imperfeitas. Tal procedimento pode ser tanto
uma técnica deliberada de resolução de problemas, como uma operação de
comportamento automática, intuitiva e inconsciente. (fonte: wikipedia)
Availability Heuristic: we tend to judge the frequency of an event by the availability of
its instances.
How to avoid:
• Good decision making requires that we identify and use truly reliable
information, not just available information. Information that is easily recalled
because it is vivid may be interpreted as being reliable when it’s not;
• Don’t get taken in by vivid presentations;
• Question information that comes easily to mind;
• On the other hand, use colourful and emotionally vivid presentations to
communicate your view.

Representativeness Heuristic: people tend to assess the likelihood of an event’s

occurrence by the similarity of that occurrence to their stereotypes of similar
occurrences.
How to avoid:
• Don’t be misled by highly detailed scenarios;

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 Organisational (Notes) MBA Executivo
January 2nd 2014
Behaviour
• Pay attention to the base rates especially when an event is very rare or very
common;
• Remember that chance is not self-correcting.

Anchoring & Adjustment Heuristic: We make assessments by starting off at an initial

value based on whatever information that is provided and adjust from that value to
yield a final decision.
How to avoid:
• Consider multiple anchors;
• When given one extreme anchor, try to imagine the other extreme.

Confirmation Bias: We rarely search for disconfirming evidence. We also tend to view
ambiguous information as confirming our hypotheses. (We tend to pre-decide before we
decide!)
Framing: Rewards and losses are evaluated relative to a neutral reference point.
Potential outcomes are expressed as gains or losses relative to this fixed neutral point.
Escalation of Commitment: A consequence of framing is the phenomenon of escalation
of commitment: When individuals are in the domain of losses (e.g., lose on a big
investment) they tend to take bigger risks, “throw good money after bad,” and in
general, escalate their commitment to a losing course of action.
Factors:
• Psychological factors: framing, sunk costs, self justification biases, self-inference
process biases;
• Social factors: external justification, external binding, social rewards for
persistence;
• Organizational factors: institutional inertia, managerial inertia, unquestioned
assumptions.
Attribution Theory: When people observe behaviour, they attempt to determine
whether it is externally or internally caused. Three types:
• Consensus (the extent to which others behave in the same manner);
• Consistency (the extent to which the person acts in the same manner at other
times);
• Distinctiveness (the extent to which the person behaves in the same manner in
other contexts).
Biases that distort our attributions about success and failure:
• Self-serving bias;
• Fundamental Attribution Error.

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 Organisational (Notes) MBA Executivo
January 2nd 2014
Behaviour
SCHOEMAKER, P.J.H.; DAY, G. – HOW TO MAKE SENSE OF WEAK SIGNALS. MIT SLOAN
MANAGEMENT REVIEW (2009)

“All managers are susceptible to the distortions and biases we saw in the credit crunch
of 2008. Organizations get blindsided not so much because decision makers aren’t
seeing signals, but because they jump to the most convenient or plausible conclusion.”

Cognitive Biases:
Personal Biases:
Filtering
“What we actually pay attention to is very much determined by what we expect
to see.” » Selective perception
Refusal to acknowledge an unpleasant reality because it is too discordant »
Suppression
Distorted Inference
Interpreting evidence in a way that sustains a desired belief » Rationalization
Wishful thinking leads us to see the world only in a pleasing way, denying subtle
evidence.
Egocentrism, according to which we overemphasize our own role in the events
we seek to explain.
Fundamental attribution bias, which causes us to ascribe more importance to our
own actions than to those of others or the environment.
Bolstering
Not only do we heavily filter the limited information that we pay attention to, but
also we may seek to bolster our case by searching for additional evidence that
confirms our view.
Selective memory and forget those inconvenient facts that don’t fit the overall
picture.
The hindsight bias similarly distorts our memories such that our original doubts
are erased. A vicious circle is created in which we exacerbate the earlier biases
and get trapped in a self-sealing echo chamber.
Organizational Bias
Groupthink
Dispersed memory and varying perceptions

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 Organisational (Notes) MBA Executivo
January 2nd 2014
Behaviour
Start Making Sense

Broadening Your Perspective, organizations should use multiple perspectives to

provide greater peripheral vision.
Seeing the Biggest Picture Possible
No single technique will suffice in revealing the whole picture, since all methods
are flawed or limited in some important respect.
Deploy Multiple Lenses. One way to systematize the triangulation process is to
look at weak signals through various scenario lenses.
Talk to Customers and Competitors. Companies often suffer from focusing
too narrowly on either customers or competitors, rather than looking at both. An
exclusive focus on one or the other creates dangerous blind spots.
The major problem is that managers are insufficiently aware of cognitive and emotional
biases that can cloud their judgment when interpreting weak signals. When ambiguity is
high, we can easily torture the weak data until it confesses to whatever we want to
believe.

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 Organisational (Notes) MBA Executivo
January 2nd 2014
Behaviour
MILKMAN, K.; CHUGH, D.; BAZERMAN, M. – INTUITION VS. DELIBERATION: HOW
DECISION MAKING CAN BE IMPROVED. ROTMAN MAGAZINE (2010)

Four strategies proposed as “solutions” to biased decision making:

1. Offer people warnings about the possibility of biases;
2. Describe the presence and direction of a particular bias;
3. Provide a dose of feedback after the decision; and
4. Offer an extended program of training with feedback, coaching, and other
interventions designed to improve judgment.

“In short, the busier we are, the more we have on our minds and the more time
constraints we face, the more likely we will be to rely on Type I thinking”
Type I thinking: intuitive system
Type II thinking: reasoning

Strategies to shift decision makers from Type I to Type II:

Replacing intuition with formal analytic processes (example: using linear models)
Consciously taking an outsider’s perspective
“Consider the opposite”
Undermine the cognitive mechanism that is hypothesized to be the source of the
bias
“Analogical reasoning” can be used to reduce “bounds” on people’s awareness

Leveraging Type I, change the environment itself so that Type I thinking will lead to
good results

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 Organisational (Notes) MBA Executivo
January 2nd 2014
Behaviour
BAZERMAN, MAX H. – COMMON BIASES. IN JUDGMENT IN MANAGERIAL DECISION MAKING.
5TH ED. NEW YORK: JOHN WILEY & SONS, 20002

Biases emanating from the availability Heuristic

Ease to recall
Retrievability
Presumes Associations
Biases emanating from the representativeness Heuristic
Insensitivity to Base Rates
Insensitivity to Sample Size
Misconceptions of Chance
Regression to the Mean
The conjunction Fallacy
Biases emanating from the Anchoring and Adjustment
Insufficient Anchor Adjustment
Conjunctive and Disjunctive Events Biases
Overconfidence
Two more general Biases
The confirmation Trap
Hindsight and the curse of knowledge

See table with breef resume of each bias

“The logic of heuristics is that, on average, any loss in decision making will be
overweighed by time saved. However, … , a blanket acceptance of heuristics is unwise.
First, … , there are many instances in which the loss in decision quality far overweighs
the time saved by heuristics. Second, the foregoing logic suggests that we have
voluntarily accepted the quality tradeoffs associated with heuristics. In reality, we have
not: Most of us are unaware of their existence and their ongoing impact upon our
decision making. Consequently, we fail to distinguish between situations in which they
are beneficial and situation in which they are potential harmful.”

Ricardo Jorge Viana Paulo

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 Organisational (Notes) MBA Executivo
January 2nd 2014
Behaviour
INNOVATION & AMBIDEXTERITY
Organizations fundamental assumptions:
• The pre-existence of purpose;
• The primacy of rationality;
• The primacy of consistency.
Positives: increase our ability to act purposively, rationally, and consistently.
Negatives: lead to rigid organizational structures and parochial mindsets that hinder
creativity in the workplace.

Exploitation Exploration
Advantages: Advantages:
Tried-and-tested approach; Latent capability;
Economies of scale; Long-term adaptive flexibility;
Efficiency; Radical breakthroughs;
Short-term gains; First mover advantages.
Leveraging core competence.
Disadvantages: Disadvantages:
Problems with adaptive flexibility when Problems with uncertainty and risk
the environment changes. when a safety net doesn’t exist.
usually related to: usually related to:
Incremental Innovation Architectural Innovation
(Small extension of current existing (Reconfiguration of existing capabilities, e.g.,
capabilities, e.g., Timex inexpensive Swatch)
mechanical watch) Discontinuous Innovation
(New operating principles, processes, or
products, e.g., first watch, Seiko Quartz)
Organizational Ambidexterity
Excessive exploitation and excessive exploration are dangerous.
The chances of long-term organizational survival and prosperity are higher when the
organization finds an appropriate balance between exploitation and exploration.

Ambidextrous organization possesses dynamic capabilities that allow them to effectively manage
multiple innovation streams -- incremental, architectural and discontinuous.

The Challenge of Ambidexterity: Different innovation types require different cultural and
structural design features that are often antithetical.
Incremental Innovation Architectural Innovation Discontinuous Innovation
Culture of continuous Culture of promoting linkages Culture of breakthrough
improvement; across units; innovation;
Incremental change; Adding and linking Experiments and variants;
Command, consistency and subsystems; Multiple, small failures;
control; Management team rewards Learning by doing;
Eliminates variability; linkages and integration. Management team rewards
Focus on cost and volume; experimentation and
Management team rewards breakthrough innovation.
volume and cost.

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 Organisational (Notes) MBA Executivo
January 2nd 2014
Behaviour
Managing Ambidexterity:
“Managing ambidextrously is really about managing a set of paradoxical tensions, such
as seriousness and play, stability and change, short-term and long-term, large and
small, formal units and skunk units, consistency and variability, control and freedom,
conformity and deviance, homogeneity and diversity, to name just a few.”

Five key Strategies (O’ Reilly & Tushman’s research)

• A compelling strategic intent that intellectually justifies the importance of both
exploration and exploitation;
• A common vision and values that promote a common identity but separate
cultures;
• A senior team that explicitly owns the ambidextrous strategy; common-fate
rewards; relentless communication;
• Separate units with aligned architectures and targeted integration (senior level
and tactical);
• Ambidextrous leadership (conflict resolution, resource allocation).

Stimulants Barriers
Encouragement Excessive Exploitation
Autonomy Conformist Culture
Playfully Challenging Work Ruthless internal competition
Sufficient Resources Harsh Criticism
Psychological Safety Extreme Time Pressures
Diversity Distractions from Work

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 Organisational (Notes) MBA Executivo
January 2nd 2014
Behaviour
AMABILE, T.M. – HOW TO KILL CREATIVITY. HARVARD BUSINESS REVIEW (1998)
“… creativity gets killed much more often than it gets supported.”

“Managing Creativity
Managers can influence all three components of creativity: expertise, creative-thinking
skills, and motivation.”

Six General categories where managers practices affect creativity:

Challenge – … matching people with the right assignments;
Freedom – … giving people autonomy concerning the means-that is, concerning
process but not necessarily the ends;
Resources – The two main resources that affect creativity are time and money.
Managers need to allot these resources carefully. Like matching people with the right
assignments, deciding how much time and money to give to a team or project is a
sophisticated judgment call that can either support or kill creativity;
Work-Group Features – If you want to build teams that come up with creative ideas,
you must pay careful attention to the design of such teams. That is, you must create
mutually supportive groups with a diversity of perspectives and backgrounds;
Supervisory Encouragement – One very simple step managers can take to foster
creativity is to not let that happen.

Great Rewards and Risks

“…fostering creativity is in the hands of managers as they think about, design, and
establish the work environment. Creativity often requires that managers radically
change the ways in which they build and interact with work groups. In many respects, it
calls for a conscious culture change. But it can be done, and the rewards can be great.”
“When creativity is killed, an organization loses a potent competitive weapon: new
ideas.”

Ricardo Jorge Viana Paulo

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 Organisational (Notes) MBA Executivo
January 2nd 2014
Behaviour
O’REILLY, C.A. III; TUSHMAN, M.L. – ORGANIZATIONAL AMBIDEXTERITY IN ACTION:
HOW MANAGERS EXPLORE AND EXPLOIT. CALIFORNIA MANAGEMENT REVIEW (2010)
“O’Reilly and Tushman argue that the ability of a firm to be ambidextrous is at the core
of dynamic capabilities. Ambidexterity requires senior managers to accomplish two
critical tasks. First, they must be able to accurately sense changes in their competitive
environment, including potential shifts in technology, competition, customers, and
regulation. Second, they must be able to act on these opportunities and threats; to be
able to seize them by reconfiguring both tangible and intangible assets to meet new
challenges. As a dynamic capability, ambidexterity embodies a complex set of routines
including decentralization, differentiation, targeted integration, and the ability of senior
leadership to orchestrate the complex trade-offs that the simultaneous pursuit of
exploration and exploitation requires. Developing these dynamic capabilities is a central
task of executive leadership.”

Leading the Ambidextrous Organization

“… ambidexterity is more likely to be successful in the presence of the following five
conditions:
• A compelling strategic intent that intellectually justifies the importance of both
exploration and exploitation;
• An articulation of a common vision and values that provide for a common
identity across the exploitative and exploratory units;
• A senior team that explicitly owns the unit’s strategy of exploration and
exploitation; there is a common-fate reward system; and the strategy is
communicated relentlessly;
• Separate but aligned organizational architectures (business models, structure,
incentives, metrics, and cultures) for the exploratory and exploitative units and
targeted integration at both senior and tactical levels to properly leverage
organizational assets;
• The ability of the senior leadership to tolerate and resolve the tensions arising
from separate alignments.

Propositions Resume:
Proposition 1, Strategic intent that intellectually justifies ambidextrous form
Proposition 2, Vision and values that promote a common identity but separate
cultures
Proposition 3, Senior team that explicitly owns the ambidextrous strategy
(common-fate rewards, communication)
Proposition 4, Separate units with aligned architectures and targeted integration
(senior level and tactical)
Proposition 5, Ambidextrous Leadership (conflict resolution, resource allocation)

Management of Ambidexterity
“One of the key features of ambidexterity is the ability of the organization to reallocate
assets and capabilities to address new threats and opportunities.”

“… for organizations to survive in the face of change, they need to be able to

successfully exploit their existing businesses and to explore into new spaces by
reconfiguring existing resources and developing new capabilities.”

Ricardo Jorge Viana Paulo

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Behaviour
SUTTON, ROBERT I. – THE WEIRD RULES OF CREATIVITY. HARVARD BUSINESS REVIEW
(2001)
“What does foster creativity doesn't look at all like rational management to most
experienced executives.”

Three sets of ideas about managing creativity:

• Hiring;
• Management;
• Risk and randomness.

This practices succeed “… by increasing the range of a company's knowledge, by

causing people to see old problems in new ways, and by helping companies break from
the past.”

“…as important as innovation is to most companies, it isn't-and never will be their

primary activity.”

“The practices that are well suited for cashing in on old, proven ways are drastically
different from those needed for innovation.”

“What makes for effective management practice can look very different, depending on
whether the aim is to exploit already-proven ideas or explore new ones.”

“Mere exposure effect” – independent of other factors, the more often people are
exposed to something, the more positive they feel about it; rare and unfamiliar things
provoke negative evaluations.

Hiring
“Slow learners” – some members who are slow to learn how things are
"supposed to be done;
“High self-esteem”
“Low self monitors” – people who are especially insensitive to subtle, and even
not so subtle, hints from others about how to act.
“People who make you uncomfortable, even those you don’t like”
“People with skills you don’t think you’ll need”
“People who don't know how things are "supposed to be" aren't blinded by
preconceptions”

Managing
“Encourage people to ignore and defy superiors and peers”
“Get them to fight among themselves”
“Creative work must be sheltered from the cold light of day”
“Keep your creative people away from your biggest customers – and for that
matter from critics and anyone whose primary concern is money.”
“Don't let a team get too cozy”
“Find some happy people and then get them to fight”
“Enhancing innovation also has to do with how performance is rewarded.”

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 Organisational (Notes) MBA Executivo
January 2nd 2014
Behaviour
“It is impossible to generate a few good ideas without also generating a lot of
bad ideas.”
“Inaction is the worst kind of failure - and the only kind that deserves to be
punished.”
“Creativity is a function of the quantity of work produced. These findings mean
that measuring whether people are doing something-or nothing-is one of the
ways to assess the performance of people who do creative work. Companies
should demote, transfer, and even fire those who spend day after day talking
about and planning what they are going to do hut never do anything.”

Risk and Randomness

“Most managers, analysts, and other so called experts (like everyone else) do a
poor job of judging new ideas and predicting which ones will succeed.”
“As James March writes, "Unfortunately, the difference between visionary genius
and delusional madness is much clearer in history books than in experience."”
“Commit to it wholeheartedly. Forget the slim odds; simply convince yourself
and everyone else that, with determination and persistence, the project is
destined to be a triumph.”
“The power of positive thinking”
“Successful heretics tend to be confident and persistent. They believe deeply in
what they are doing and are skilled at convincing everyone around them that
they are right.”
“"Confidence in nonsense is required" This suggests that, if you can't decide
which new projects or ideas to bet on based on their objective merits, pick those
that will be developed by the most committed and persuasive heretics.”
“Random selection is one of the best ways to ensure that new ideas will not be
biased by knowledge of past successes.”

“…doing routine work with proven methods is the right thing to do most of the time. It
is wise to manage most organizations as if the future will be a perfect imitation of the
past”

“Tried and true wins out over new and improved most of the time.”

“… if part of your mission is to explore new possibilities, then your goal must be to build
a culture that supports constant mindfulness and experimentation. It isn't sufficient to
generate new ideas now and then. Your company – or more likely a part of it – needs to
be a place that generates and tests many disparate ideas. It should be an arena, a
constant and constructive contest, where the best ideas win.”

“… most companies will always devote more time, people, and money to exploiting old
ideas than to exploring new ones. Exposure effects being what they are, managing for
creativity will always require a conscious effort.”

Ricardo Jorge Viana Paulo

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 Organisational (Notes) MBA Executivo
January 2nd 2014
Behaviour
INFLUENCE
Influence without authority
Authority: The “right” or “obligation” to seek compliance;
Power: The demonstrated ability to achieve compliance;
Influence: The process by which people successfully persuade others to follow
their advice, suggestions, etc.

Types of Influence
• Interpersonal influence:
o Liking, we prefer to say yes to the requests of people we know and like;
o Reciprocity, we try to repay in-kind what the other side has offered us;
o Social Proof, we use others’ actions to decide on proper behaviors for
ourselves when we are not sure what we should do;
o Consistency, once we make a choice or take a stand, we encounter
personal and social pressures to act consistently with that commitment;
o Authority, we tend to defer to authority--even mindlessly. We tend to
respond to the mere symbol of authority rather than to its substance;
o Scarcity, we tend to appreciate more opportunities that are less available.

• Procedural influence:
o What?

Find out what is on the agenda, what’s behind the agenda, and
who’s setting it
o Who?

Be present for important meetings.

Find out who’s who in the meeting.

Find an ally before the meeting.
o Where?

Meeting location and table configuration affect discussion.

Seating position shows status.
o When?

Speak early to anchor and frame the discussion.

• Use an ally to anchor and frame the discussion.
o Timing

Preliminary vote or late vote?

First issue to vote on?
o Format

Public or private vote?

Who raises a hand first?
o Rule

Majority? Unanimity?

Revisit and reexamine the decision
o Breaks

Use breaks to secure commitments or disrupt influence.
o Tracking

Who keeps an official record

Who gets a copy of it?

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 Organisational (Notes) MBA Executivo
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Behaviour
• Decision-making biases:
o Availability:

Use vivid arguments and presentations

Sit in a noticeable position
o Representativeness

Use detailed scenarios, rather than general statements

Say 3 out of 4 instead of 75%
o Anchoring

Speak first

Make the first offer
o Framing

Frame positively to encourage risk-aversion

Frame negatively to encourage risk-seeking

Make concessions slowly

Present comparisons that make your view more desirable
o Confirmation

Frame questions in such a way so that people will seek
confirmatory evidence

Other Influence Tips:

• Remain calm; deflect or redirect aggression;
• Appear to remain impartial;
• Don’t display your agenda; highlight the agendas of others;
• Don’t put all your cards on the table right away;
• Ask questions instead of asserting positions to help others “discover” your
insights;
• Don’t make absolute statements--they are easy to discredit;
• Frame for common ground and for the interests of others;
• Know who has something to win or lose from your view; find allies and play with
scenarios in advance;
• People tend to become privately convinced before they become publicly
convinced: Influence begins before the meeting!

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 Organisational (Notes) MBA Executivo
January 2nd 2014
Behaviour
POWER & PERSUASION
Bases of Power:
• Network: Obtain compliance through alliances--colleagues, sponsors and friends
• Symbolic: Obtain compliance through control of meanings, myths & symbols
• Personal: Obtain power through charisma, verbal facility, or the ability to
articulate vision
• Expert: Obtain compliance through one’s skills, knowledge, & ability
• Coercive: Obtain compliance through the ability to constrain, block, interfere or
punish
• Reward: Obtain compliance through the ability to deliver actual or promised
rewards
• Legitimate: Obtain compliance through formal authority

“Differences in political interests, competition over scarce resources, as well as

differences in values and preferences often lead to interpersonal and intergroup
conflict.”
Conflict can be dysfunctional or functional.

Competition Collaboration
Assertiveness

Compromise

Avoidance Accommodation

Cooperativeness

(See slides for each type of conflict characteristics)

“Authority is not influence”

Influence Tactics:
Legitimating – The agent seeks to establish the legitimacy of a request by
claiming the authority or right to make it, or by verifying that it is consistent
with organizational rules and policies.
Rational – The agent uses logical arguments & factual evidence; appeals to the
viability of the proposal and the likelihood of attaining objectives.
Exchange – The agent offers an exchange of favors, indicates willingness to
reciprocate, or promises a share of the benefits.
Pressure – The agent uses demands, threats, frequent checking, or persistent
reminders.
Inspirational – The agent arousal enthusiasm; appeals to target values, ideals,
and aspirations; increases others self-confidence.

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Behaviour
Coalition – The agent seeks the aids or uses the support of others to persuade
the target individuals to do something.
Consultation – The agent seeks others participation in planning and executing an
activity; is willing to modify his or her course of action to secure others support
or cooperation.
Ingratiation – The agent uses praise, flattery, or friendly behavior to make
others think favorably of him or her before asking them something.
Personal Appeals – The agent appeals to others feelings of loyalty and friendship
toward him or her when asking for something.

Leadership Styles
Transactional Transformational
• Transactional agents • Value-driven agents
• Rational exchange • Idealized influence
• Rewards for performance • Inspirational motivation
• Contingent reward • Intellectual stimulation
• Contingent punishment • Emotional stimulation
• Laissez-faire • Consideration & support
• • Induce anxiety and fear of failure to • Induce interest & enthusiasm to
others others

Persuasion Strategies
Ineffective Strategies Effective Strategies
• Up-front hard sell • Establish credibility
• Resist compromise • Frame for common ground
• Great arguments alone may not work • Provide evidence
• One-shot effort • Connect emotionally

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 Organisational (Notes) MBA Executivo
January 2nd 2014
Behaviour
CONGER, JAY A. – THE NECESSARY ART OF PERSUASION. HARVARD BUSINESS REVIEW.
(1998)
“Gone are the command-and-control days of executives managing by decree”

“Persuasion is widely perceived as a skill reserved for selling products and closing deals.
... But exercised constructively and to its full potential, persuasion supersedes sales and
is quite the opposite of deception.”

“Effective persuasion is a difficult and time consuming proposition, but it may also be
more powerful than the command-and-control managerial model it succeeds.”

“Before they even start to talk, effective persuaders have considered their positions
from every angle.
Dialogue happens before and during the persuasion process. Before the process begins,
effective persuaders use dialogue to learn more about their audience's opinions,
concerns, and perspectives. During the process, dialogue continues to be a form of
learning, but it is also the beginning of the negotiation stage. You invite people to
discuss, even debate, the merits of your position, and then to offer honest feedback and
suggest alternative solutions.
That may sound like a slow way to achieve your goal, but effective persuasion is about
testing and revising ideas in concert with your colleagues' concerns and needs. In fact,
the best persuaders not only listen to others but also incorporate their perspectives into
a shared solution.”
--- Persuasion demands compromise ---

Four Ways Not to Persuade

1. They attempt to make their case with an up-front, hard sell;
2. They resist compromise;
3. They think the secret of persuasion lies in presenting great arguments;
4. They assume persuasion is a one-shot effort.

Four Essential Steps

• Establish credibility;
• Frame for common ground;
• Provide evidence;
• Connect emotionally.

The Force of Persuasion

“The concept of persuasion, like that of power, often confuses and even mystifies
businesspeople. It is so complex – and so dangerous when mishandled – that many
would rather just avoid it altogether. But like power, persuasion can be a force for
enormous good in an organization. It can pull people together, move ideas forward,
galvanize change, and forge constructive solutions.”

Ricardo Jorge Viana Paulo

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e-mail: ricardo.paulo@transdev.pt
 Organisational (Notes) MBA Executivo
January 2nd 2014
Behaviour
WILLIAMS, GARY A.; MILLER, ROBERT B. – CHANGE THE WAY YOU PERSUADE. HARVARD
BUSINESS REVIEW VOL. 80, Nº5 (2002)
“All too often, people make the mistake of focusing too much on the content of their
argument and not enough on how they deliver that message.”

“... executives typically fail into one of five decision-making categories:”

• Charismatics, they are easily intrigued and enthralled by new ideas, but
experience has taught them to make final decisions based on balanced
information, not just emotions;
• Thinkers, they are impressed with arguments that are supported by data. They
tend to have a strong aversion to risk and can be slow to make a decision;
• Sceptics, they tend to be highly suspicious of every data point presented,
especially any information that challenges their worldview. They often have an
aggressive, almost combative style and are usually described as take-charge
people;
• Followers, they make decisions based on how they’ve made similar choices in
the past or on how other trusted executives have made them. They tend to be
risk-adverse;
• Controllers, They abhor uncertainty and ambiguity, and they will focus on the
pure facts and analytics of an argument.

Ricardo Jorge Viana Paulo

Page 18 / 18
e-mail: ricardo.paulo@transdev.pt