Behavioural economics is simply how our choices about what we do and how we do it – our decisions - affect
performance, both hard and soft – results and reputation.
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But now they’re not around, or
they are fighting fires because there are so few of them left. In their wake,
according to Harvard Business Review last month (Oct 2013), there is a
significant problem for talent management which, in the hands of line managers, will result in a behavioural economic crisis.
HR used to put the rigour, balance and process in to these decisions but now we have no conscience challenging our assumptions, testing what the outcomes are that we really want; pointing out (with enormous diplomacy) that candidate ‘A’ might be a great bloke but Candidate’B’ will be the woman that delivers the result.
HR used to put the rigour, balance and process in to these decisions but now we have no conscience challenging our assumptions, testing what the outcomes are that we really want; pointing out (with enormous diplomacy) that candidate ‘A’ might be a great bloke but Candidate’B’ will be the woman that delivers the result.
Men over-index on HRT |
Since the
Lord Davis Report in 2010, the aim of which was to address the lack of women in
executive positions in the FTSE 350, there has actually been a decline in the number of female
executive directors. With Burberry’s CEO Angela Ahrendts leaving for Apple we have now only 2 female CEOs
in the FTSE 100.
The fact is that the busier we are the more we rely on our judgement and our beliefs of what makes a
good, great or just safe-bet for a key role. These beliefs are developed predominantly
through the assimilation of the prevailing view and attitude of society, and
rarely firsthand experience. Consider this - if you were in an aeroplane flying
through a violent storm, how would you really feel if the captain spoke up and
it was a woman’s voice? We all share the same default settings because that’s
what we ‘know’, and the unknown – however logical - is just not what we go with
when the chips are down. We know men are successful pilots, leaders, scientists
but it’s only because that’s all there has really been till very, very recently
and women remain the exception. Of course men are great leaders, they are also
rubbish leaders and mediocre leaders and every shade in between. But we assume that they are naturally a better
bet than women. This is just how human brains work, but this is at odds with
how we approach the question of making a business succeed. We must be bold,
innovative, creative. We must do what others haven’t yet done. We must spot opportunities
they haven’t identified and go for it. We must be externally focused and be
prepared to make mistakes on the path to greater success.
- Recent research has shown that the most successful innovation teams have a greater than 50% female composition**
So you must be as bold, as creative and as innovative in
promotion, recruitment and project assignment. You must focus on what it is you
want to achieve in order to be clear on the sort of talent you need and what
sort of environment will enable that talent to thrive
- Credit Suisse Research 2012: "In testing the performance of 2,360 companies globally over the last six years, our analysis shows that it would on average have been better to have invested in corporates with women on their management boards tan those without" ***
So, here are the simple Pause for Success™ check
steps you should implement whenever you are making a choice about people
(project roles, talent assessment, promotion, recruitment and even extra
curricula socialising). The more literal you are about following these steps
the more likely you are to succeed – and vice versa!
- Articulate the key capabilities you are really looking for; Articulate the traps you could fall into if you let your cognitive short cuts dominate your true objectivity; Articulate the type evidence that would indicate individuals have the potential to deliver the outcomes you want.
- Before you make your final decision PAUSE.
- Challenge any decisions that feel instinctive or gravitational (you are pulled towards them, but struggle to justify them). Go back over the first point and check you are being as objective as you can be.
This critical challenge is vital for business health and the
pressure is now on individuals to get the right people, in the right places
with the right support.
Try the process and let us know what your before and after
decisions looked like, and what you have learnt about yourself and what
benefits the new outcome will deliver.
* Eagly, A. and Carly, L. (2007). “Through the Labyrinth”.
Published by Harvard University Press
** London Business School. The Lehman Brothers Centre for
Women in Business (2008), “Innovative Potential: Men and Women in Teams”
*** Credit Suisse Research Institute (Aug 2012) “Gender
Diversity and Corporate Performance”