34 Comments

I suspect that the function of the CEO and other high executives is primarily to arbitrate disputes between lower ranking members of the firm. Two upper-mid-level managers can argue forever about what to do, but the CEO can simply tell them who's "right" and they have to shut up and listen.

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Speaking as consultant with one of the top firms, I more than once (in fact, I am going to do it starting next week) wheeled out scarily big guns to disprove pre-existing hockey sticks as the bullshit they are (it usually takes all of 15 minutes to figure that out and then weeks of nasty analyses to prove it beyond doubt).

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I used to work for a business unit on the planning side that had to make a decision between two sets of demand forecasts. One was pretty labor intensive and infrequently updated based on past history (something like once a quarter), and had rather bad accuracy. The other was almost entirely automated and didn't require much in the way of human time, updated every month, and had better accuracy.

The business, after being shown a great deal of data demonstrating these facts, chose the more expensive and less accurate forecast. On purpose.

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Can you be entirely confident that your understanding of the overall needs of the organization (aka, the "corporate objectives)" was superior to that of the understanding of the manager three levels above you?

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Don't underestimate the importance of a manager being prepared to make a decision. Very often there isn't a huge difference between the likely outcomes of different answers. In such cases being an effective manager just means being prepared to make a decision and then back it. Of course that will sometimes backfire, but most good managers I've known have had that characteristic.

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Our company had to choose between two options, let's call them 'plan A' and 'plan B'. I presented my manager with an analysis that showed 'plan A' was overwhelmingly superior, given corporate objectives. BUT 'plan A' needed the approval of management two levels above my manager, and 'plan B' only needed the approval of management one level above my manager. So my manager made an attempt to sell 'plan A' to his manager, then my manager's manager made a half-hearted attempt to sell 'plan A' to his manager. A little bit of push back led him to conclude it wasn't worth the bother of trying to change his boss's mind (and potentially annoying him in the process), and so he gave the instruction to go ahead with 'plan B' instead.

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Be aware that we've already had the IQ argument here before, so I'd encourage anyone participating in it now to read the previous discussion so we don't retread old ground.

"differences in socioeconomic status, poverty, abuse, poor at home environment, poor prenatal care, unequal opportunity and stereotype threat."Most of those can be examined through adoption studies, prenatal care notably excluded. We can even examine the effect that the perception of others have through studies that show whether parents mistakenly believe their children are or are not identical vs fraternal, or even biracial. A lot of that can be skipped with a GWAS like the recent Ian Deary study on IQ, following up on the Dolan GWAS on height I referenced in the previous OB link.

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Someone had a great post on "The costs of savoring". The same logic applies to managers: opening one's mind to more information, alternate approaches, new ideas, is costly, requiring ,requiring time and energy. And the returns for the additional investment in time and energy are highly uncertain with no proven track record. And almost by definition getting more information means embarking on a path which one's boss has never trod, and hence will require an additional investment in selling the boss.

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I disagree. Liberals don't try to deny what the facts are, they simply have a different explanation for what the facts imply.

To a liberal, racial, ethnic and gender differences in achievement are real, but they are essentially all due to differences in socioeconomic status, poverty, abuse, poor at home environment, poor prenatal care, unequal opportunity and stereotype threat.

Conservatives make up “facts” to suit their beliefs. Conservatives believe that ethnic differences in achievement are due to differential genetics, despite the fact that no genes have been found that are consistent with such beliefs.

In other words, Liberals explain differential achievement by looking at the real differences in socioeconomic status which are known to mediate differences in achievement and which have been demonstrated to do so across many cultures, and then seek to mitigate those adverse effects.

Conservatives ignore the known adverse effects and attribute differential achievement to unknown hypothetical genetics and bad choices, such as choosing to be born in poverty. They do this because they don't want to do anything that might mitigate what is really causing differential achievement.

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Liberals (in the American sense of the word) do seem to be on the side of the facts and reason more often, they don't always understand why, but they do seem to be better at figuring out who to listen to if they don't know much about the subject themselves. So no, they're not two sides of the same coin, they don't just have opposite dogma's. The difference between having an open mind and feverishly defending (caricatures, I know, but like any good caricature they preserve the essence) traditions because you're afraid of the unknown, goes much deeper. Liberals and conservatives really think differently.

This deevaluation of reason and facts is a disease. No, when you believe black people are inherently dumb you don't have merely the same bias as someone who believes humans of all skin colors have the same average intelligence, they are not just two opinions of equal value. One has only prejudiced softcore research (questionable psychology and statistics research), while the other is rooted in cold hard genetics research and is logically the default stance. It's the same with climate change: people contrive all sorts of ways to deny something they don't remotely understand, purely because they're afraid of carbon taxes. (American) politics are scary in this way and the media are complicit because of what they call "balanced reporting".

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Or smoking being not so bad actually.

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The ubiquity of Program Management institutionalizes management ignorance of individual projects. Simple questions like "does it work" and "can we sell it" become meaningless reports about schedule and design budget tracking and reporting. PM won the war on metrics by replacing performance requirements and market expectations (which are largely invented out of whole cloth before the project gets rolling) with ginormous heaps of meaningless info-tainment. Project teams are trained to project specious outcomes which become embalmed in layers and layers of pointy headed manager heirarchies. If we give a PM a team of individuals that are invested in building a car that floats and flys FROM DAY ONE we get project plans that demonstrate... winning plans for cars that float and fly. On time and under budget.

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For example any data about gender or race differences.

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I think ignoring evidence and denying reality is mostly a Conservative tactic. Reality has a liberal bias, so liberals don’t need to do that.

I know that I should not but I had to answer this. Both side have their biases and if you do not see bias among liberals you are not looking. I think they are equally good at ignoring science that does not go their way.

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Robin -

Isn't this mainly the age-old principal-agent problem? Perhaps compounded with confirmation bias?

I don't think managers are necessarily disinterested - I think they're solving different problems than what appears on the surface. The trick is to understand what problems they are solving beyond what is readily apparent. Signalling status is definitely part of that equation. Another factor is inertia: resistance to change, fear of the unknown, or inability to understand.

As with the recent example of using high-status consultants, signalling may not work if the underlying reason for the decision is known, so managers have an incentive to hide the fact that signalling is part of their objective.

For a specific example, when a recommendation is sent back for further study. I saw this when the President of a publicly traded company where I was employed was a former IBMer. A study of products resulted in a recommendation to go with an IBM competitor. When asked to re-evaluate, we had the same results. Then again. After many delays and studies, we finally bought the IBM product. The President, who was newly hired and didn't stay long, had other objectives besides the health of the company. In retrospect, those objectives were maintaining a solid network for future job opportunities. Although we knew our president was being influenced by this relationship, we didn't understand that he didn't really care what the study said, and he couldn't tell us his true motivation.

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nazgulnarsil -

I agree about the fault tolerance. This is why so many incompetent managers and executives are able to survive and thrive in the corporate world. I've also seen a surprising number of small business owners make surprisingly stupid mistakes without any lasting impact.

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