Have you ever been in a meeting where a topic comes up and the conversation becomes:
- Person A: “I think that is an HR problem.”
- Person B: “No, it’s an IT problem.”
- Person C: “It is a problem of funding.”
- Person D: “I think it is caused by customers and marketing.” Etc..
Of course, you have. Each person is looking at the problem and diagnosing it in a different way. As a result, they believe their diagnosis is correct, and their natural instinct (management judgement) is that their approach is the way to go. At this point, they will all leave the room taking completely different courses of action to solve the same problem.
These people are all diagnosing the situation differently. They are all framing it differently. Why?
How we diagnose and frame a problem determines how we then address it
First, we need to be clear that having various different diagnoses and frames, will cause problems. How you frame a decision, or diagnose a problem, is fundamental to how you solve it. For instance, if you think the problem with low sales performance is one of the IT systems, then you will address the sales problem in quite a different way compared with deciding it was a problem of the sales staff’s competence, or if it is their motivation. How you diagnose, classify or frame the problem in the first place will dramatically affects all subsequent decisions. In the first instance you will have arguments in the room about how to solve the problem. If people all leave the room trying to solving the problem different ways, then the team will lack coherence and the problem is likely to remain unsolved.
How we frame a decision: The power, and disadvantage, of heuristics
What people are doing here is natural. We as humans operate by identifying patterns and using those patterns to make life easy. It is how we succeed. For instance, when we are driving and see a red light, we know we have to stop, instinctively. We don’t have to go, “Just a minute, I need to check again what a red traffic light means”. In psychology this is called a heuristic. (define…
This pattern matching can get means we apply it in more complex situations. We see a situation in our organisations and go, “I have seen that before – it’s a problem of….”. Of course, this is good for quick decisions. It is poor if the situation has not been properly explored and diagnosed. It is a real problem when several people diagnose the same situation quite differently.
We diagnose decisions and make decisions based on, what appear to be, similar decisions from the past
One way these heuristics occur is when we make decisions based on what appear to have been similar decisions in the past. If they are similar, this is fine. The problems occur, when a closer look would reveal that they are not at all similar.
We also substitute one problem for another, even though they are not similar (wanting KPIs, when you really have to clarify the strategy first, is a good example of this). This is called a substitution heuristic. I describe an example of this in “Why use a KPI? Beware the KPI substitution heuristic“.
We are also biased by simple comparisons, so when asked to guess a price we are influenced by random numbers that we are given, even though we know they are random and unrelated. We make leaps of assumptions about how people might behave or what they might do, when statistically, the assumptions are complete nonsense. Daniel Kahneman’s work has identified around 150 types of such error. What works to help us survive can also act to cause problems in our decision making.
Mis-diagnosis and mis-framing is common to both decision making and strategy work
This problem diagnosis is a persistent theme within Daniel Kahneman’s work. In psychology if a problem is mis-classified it is called a category error; the problem has been categorised wrongly.
When I am doing work around decisions I use the expression the frame, to frame a decision. When doing strategy work, I have challenged my clients to describe the situation and find the underlying characterisation or diagnosis on the problem. (This characterisation/diagnosis approach is based upon the work of Richard Rumelt, an academic that McKinsey call “The strategist’s strategist). Whether it is framing a decision or characterising a problem, it is in essence the same process.
With both this strategy process and the six step decision process, I am making the framing, diagnosis, categorisation stage explicit. By making the stage explicit, it highlights that part of the decision making process. It forces people to notice when a situation is being framed or diagnosed differently. Simply highlighting that there are different diagnoses, can dramatically improve the quality of conversation and discussion about decisions amongst a team. It causes people to have to explain the reasoning for their diagnosis. How they have come to that conclusion. It means that the underlying thinking that led to the diagnosis becomes exposed and open to discussion.
Hard fought diagnoses can become completely unresolved and intransigent
A failure to expose and explore these differences of diagnosis can lead to very entrenched positions. This happens, in part because the framing step is quickly passed and the person the moves onto decision action. They have effectively said, “I know what this problem is, so we should do this now”. If the diagnosis and therefore action of another person in the team is quite different, and their differences are not resolved, these can become very stuck issues.
For example, I met with one management team who had made great strides with their strategy but had one sticky problem which they could not resolve. It was a source of unresolved argument amongst them. It came as no surprise to me to recognise that there were two quite different diagnoses of the situation held by two separate parts of the team. Unless they agreed on the frame or diagnosis of the problem, their strategy to resolve it, their action plan, their resources investments, let alone any measures would have to wait. All was held up by a difference in the characterisation or frame of the problem. Agreeing a diagnosis, even as a temporary expedient, would help to unblock the argument and allow progress.
Make a point if identifying and pointing out the frame of a point of view
Merely identifying the different frames in use will dramatically improve the quality of thinking and conversation in a team
Making this framing stage clear has really helped clients, whether I called it “diagnosis and characterisation” in strategy work, or “Framing” when talking about decisions. What is clear to me is that, in thinking fast we often skip straight through this step, leap to a diagnosis, or frame, and progress down that path. Often we don’t even recognise we have done it, so what chance do others have? This of course means that others will not realise why or how you choose that frame or diagnosis.
So, how we frame a decision precedes decision making. Making the frame explicit improves the quality of conversation and decision making.