Management

Taking Personal Change Seriously: The Impact of Organizational Learning on Management Practice

Published on by Jared Padgett

 To detect an error is to acknowledge incompetence. Doing so publicly in a work setting is often seen as ‘career limiting,’ discouragement enough even if it wasn’t also personally threatening.

This article is a review of the impact the book, Organizational Learning, has had on management practice since its publication. Though there are flaws in the traditional approach to doing business in high-risk fields, the concept of a learning organization has appeal to both managers and academics.

The author discusses the effect of personal change on an organization. Until a manager is willing to change personally, any change attempted within the organization will be limited. A manager should be willing to admit mistakes, and should expect subordinates to do the same, without fear of retaliation or loss of esteem or status. This contributes to a learning culture, where people can learn from failures to prevent future incidents.

HRO principles and the concept of learning cultures are compatible. A true learning culture is hard to achieve, as it typically involves admitting inadequacies or failure. We are trained from an early age how to shift blame, and avoid punishment for failures. Learning organizations and HROs try to learn from mistakes, and do not assign blame for systemic failure. Assigning blame lowers the participation, and ultimately contributes to additional failure.

Senge, P. M. (2003). Taking personal change seriously: The impact of organizational learning on management practice. Academy of Management Executive, 17(2), 47-50. doi:10.5465/AME.2003.10025191

The Essence of Management Decision

Published on by Jared Padgett

The authors described the concept of management decisions in a business environment . They identify the tendency of research to focus on the decision maker, or even the decision itself, without really understanding the bigger picture. This article distinguished daily operation decision making from big picture decision making. These are broken into “Category I” and “Category II” decisions, with Category II being the bigger picture .

A Category II decision is important in the context of the business itself. It takes into account external factors, including competitors, precedence, and applicable laws. These decisions cannot be delegated, as there is an element of uncertainty, and the stakes are high. Category I decisions, in contrast, can be delegated. These decisions can be duplicated at regular intervals, do not impact the organization as a whole, and have less uncertainty.

In business, it is important to know when to delegate, and when the decision must be made personally, for the good of the firm. This article speaks to this difference, and explains how to tell which decisions are the sole responsibilities of upper management. By allowing the upper management to make the firm-wide decisions, smaller, routine decisions can be delegated to middle and lower managers. This can free valuable time and resources for the critical decisions.

HRO seeks to mitigate risk in the face of uncertainty. This falls into the Category II decisions as described in the article. Understanding the importance of the decisions, and preparing in advance for these decisions is important for an organization. Defining decisions as management decisions helps, but does not address the importance of relying on individuals with knowledge of the situation.

Harrison, E. F., Pelletier, M. A., (2000). The essence of management decision. Management Decision 38(7), pp.462 – 470. doi: 10.1108/00251740010373476

Common and Uncommon Sense in Managerial Decision Making Under Task Uncertainty

Published on by Jared Padgett

Dinur, A. R., (2011). Common and uncommon sense in managerial decision making under task uncertainty. Management Decision, 49(5), 694-709. doi: 10.1108/00251741111130797

The premise of the article is an exploration of sense making from both a common and uncommon sense approach . Common sense, by most of the provided examples, was only possible in an area of no prior training or experience . Common sense is considered instinctual. This goes against common practice of hiring managers based on experience.

Once a reasonable definition of common sense is established, the author defines two new concepts, Managerial Common Sense (MCS) and Managerial Uncommon Sense (MUS). Basically, managers who are experienced in business are perfectly capable of MCS. They have seen a lot, and can make decisions from personal experience . When a situation comes up where the manager has no experience, a decision could result in a system failure, which is described as mechanistic by the author. Some situations call for depending on the expertise of others. This is considered uncommon, and is tied to the MUS concept.

Management Indecision

Published on by Jared Padgett

Brooks, Margaret E. (2011). Management indecision. Management Decision, 49(5), 683-693. doi: 10.1108/00251741111130788

This article focuses on indecision, which can lead to error. The author indicates there is a lot more research on making decisions than on the failure to make a decision.

Society has convinced many people that it is better to choose not to act and suffer the consequences rather than act incorrectly and suffer similar consequences .

The consequences for not making a decision often outweigh the consequences of making a bad decision, yet the fear of making a bad decision ultimately proves to be a more powerful motivator. Among the solutions is a punishment and reward system designed to reward decision-making and punish indecisiveness.

Decision making is integral to the practice of High Reliability Organizations (HRO). Understanding the causes of indecision among managers will be helpful when determining how to best implement HRO concepts in a new environment. Changing an organization’s culture from indecisive to decisive may help prevent costly errors.