Systemic Reasoning Errors: Stink’en Think’en
The April 13-14, 2019 edition of the Wall Street Journal featured an opinion piece by Holman W. Jenkins, Jr., Russiagate and the Media’s News Denial. The author makes the point, “Judgement is teachable. Long ago, in relation to the Enron debacle, I pointed to the work of Harvard’s Max Bazerman and Northwestern’s David Messick, who theorized how systematic reasoning errors can lead to unethical business judgments.” He goes on to discuss how the journalism sector may be suffering from this problem, vis-à-vis the Trump Administration.
Cognitive bias errors impact the way people process and interpret information. Our attempt to simplify can lead to nonobjective, illogical and poor decision making. So, do these poor judgement issues concern me?
The emerging digitalization model to attain and sustain Operational Excellence by definition is systemically complex. A highly integrated ecosystem coupled with tens of thousands of data sensors and quasi-independent processing systems support field operations. Moreover, risk mitigation models in such an environment are themselves complex.
Human decision-making processes in this new environment will necessarily change from the traditional management of automated systems and data analysis. Extensive training must be part of the transformational process.
Additionally, Governance models may need revision as well. What is the role of the Board and ‘C’ Suite (CIO vs. COO?) with the digitalization of the organization?
Clarification. The term ‘stinking thinking’ refers to tactics either unintentionally or insidiously used to create expectation biases.[i] The title uses a colloquial term Stink’en Think’en as a function of lousy thought processes; nothing more.
The challenges we face are much more than technology driven. As always, human Behaviors are at the core and Conditions in the near future may be dramatically different from the present.
New Relationships will emerge as well. We have previously discussed the R B C model. It is good guidance for this transformation.[ii]
How Does Your Organization Mitigate Systemic Reasoning Errors by Its Decision Makers?
For More Information
How Cognitive Biases Influence How You Think and Act is a very good article on this subject. Interested readers may want to check it out.
You can contact the author more information as well.
Critical Mass: Value from the RBC Framework
Nuclear physicists define the term, “critical mass” as the amount of fissile material whereby a nuclear reaction is self-sustaining. From that original definition, the construct is further developed along societal and political terms as a function of the environment and number of adopters and their interdependencies that create enough of a consensus for individual actions that sustains an undertaking.
In 1996, the author published the first of several case studies on a societal interaction model based on the Relationships, Behavior and Conditions (RBC) construct among economic actors. Previously the model was only in the domain of academia.
This blog addresses contemporary issues from the RBC perspective and whether in the present state they are sustainable or not. Many readers may be familiar with the “Innovation Adoption Curve.” RBC seeks to enlighten the causality of behaviors that cause movement towards the critical mass that generates movement along this diffusion curve.
- Lessons from the Seventies November 12, 2019
- Want – Like – Need October 24, 2019
- It’s the Economics Stupid! October 18, 2019
- In Defense of Humans—Machines Are Not Ready Yet October 1, 2019
- Culture Matters A Lot! Cultural Interactions Matter MORE!! September 22, 2019
Other Blogs Dr. Shemwell Authors
Dr. Shemwell is an author for the following 3rd party blogs.
Governing Energy Blog
BTOES Insights is the content portal for Business Transformation & Operational Excellence opinions, reports & news. Dr. Shemwell is a contributor.
Consult 2050 connects organizations with a wide range of consultants all around the world. The firm operates an online marketplace for consultancy services.
About the Author
Dr. Scott M. Shemwell has over 30 years technical and executive management experience primarily in the energy sector. He is the author of six books and has written extensively about the field of operations. Shemwell is the Managing Director of The Rapid Response Institute, a firm that focuses on providing its customers with solutions enabling Operational Excellence and regulatory compliance management. He has studied cultural interactions for more than 30 years—his dissertation; Cross Cultural Negotiations Between Japanese and American Businessmen: A Systems Analysis (Exploratory Study) is an early peer reviewed manuscript addressing the systemic structure of societal relationships.