# Managing Groups and Teams/Process Losses

## Subject

How do our unconscious biases affect the way we manage and interact with
teams?

Years of experience and research has taught us that the biases held by
managers, as well as team members, have a tremendous effect on team and
individual performance in the workplace. As managers, these biases
dictate the way we recruit our workforce, assign job duties, evaluate
staff performance, and determine promotions. Most managers assume that
they are fair individuals and claim to be non-biased in their decision
making processes when in fact this may not be the case. The problem is
that we do not take the time to reflect on the process by which we make
certain decisions and the unconscious biases that affect those
decisions. Consequently, these decisions may prove to be detrimental to
the success of a business. Recognizing our potential to succumb to
unconscious biases in the workplace can help to prevent us from making
bad decisions.

## Examples

Examples and anecdotes are essential in understanding the negative
effects that these biases have in the workplace. As we discuss theories
and ideas surrounding the subject matter, we will integrate our personal
and professional experiences into this project to better illustrate our
points. The following are examples of risky decisions that may be
infected by biased decision making.

## Halo Effect

#### Description

This type of bias exists when a person allows one characteristic of
another person to affect the evaluation of other characteristics. When
one attribute is more relevant or apparent, one tends to extend the
understanding or interpretation of that trait to all other attributes.
One simple example of this bias is if one assumes that because John is a
good singer, he must, therefore, also be a good dancer, a good cook and
a good husband.

#### This bias seen in a team environment

*Peter is a manager over a team of 8 employees. He treats his employees
fairly and trusts their ability to get the job accomplished. Susan, a
team member who is an excellent cook, has been one of Peter's favorite
employees. Peter has recently put Susan in charge of organizing the
company's recipe book, a large project that requires not only cooking
skills, but also organization, design and printing skills. Also, because
of the way Peter views Susan's cooking skills, he asked her if she could
lead the team in a cost saving project that requires expertise in
finance and accounting. Susan has no expertise in that area and managing
these two projects will be a daunting task.*

#### Effects in the workplace

As seen in the example above, the halo effect can be very detrimental
not only to team members individually, but also to the team
collectively. A team leader can very easily assume that a team member is
capable of other tasks simply because of one specific characteristic
that was observed previously. This bias directly affects a team leader's
decision making process. Here are some very common consequences of this
bias: - Over or under trusting an employee or a team member - Offering
unfair advantage or disadvantage to a team member - Assigning too much
or too little to a specific team member - Misjudgment of character

#### How to remedy this bias

The first step to avoid or remedy the halo effect bias is to gather
information. This can be done through simple performance reviews,
surveys and observations. This step is crucial in eliminating this bias
because it allows the observer to view the person from different angles,
understanding their stories from their perspective. This step also
allows for a diminished level of interpersonal conflict. When
information is readily available, people tend to gravitate to the
central issues rather than personal biases.[^1] The second step is to
interpret the information gathered. As data is gathered, the team leader
can understand the specific strengths and weaknesses more objectively.
Misunderstandings and misconceptions can be eliminated in this step of
the process. The final step is to draw conclusions. As the observer
analyzes the information gathered, he/she can more accurately understand
other team members' qualities and avoid extending those qualities to
other attributes. The conclusions that are drawn in this step form a
more correct image of the person being observed in the team leader's
mind.

## Stereotyping

#### Description

Stereotyping is probably the most commonly known type of bias and
undoubtedly one of the most commonly present in the workplace, social
environments and the media. This bias can be described as the tendency
people have to simplify their perception of the world around them by
allocating people in separate groups or clusters. By putting people into
those groups, one allows him/herself to believe that all the members of
that group act, behave and think the same way. This bias completely
disregards people's individual characteristics, skills and
personalities. Although this bias is normally negative, attracting
unrealistic assumptions and conclusions, sometimes this bias can
actually present positive aspects. The most common types of stereotyping
are related to race, gender, education, nationality and political
backgrounds. One common example of stereotyping can be often seen in
television shows and movies. One classic example of stereotyping in the
media can be seen in the show "The Simpsons", represented by several
different characters. Apu, for example, is an Indian sales clerk that is
show as a "stereotypical" person born in India. Several different traits
seen in the Indian culture are represented by Apu, as if he had all
those characteristics seen in several different people from that
country.:Image: Cultural bias is the most common
type of stereotyping, whether associated with nationality, origin,
language or race. Stereotypes based on cultural characteristics can be
very dangerous in the workplace, not only because of ethical issues, but
also because several laws protect employees against this type of bias.
Very often this type of bias can lead to more severe prejudices such as
racism. The United States Equal Employment Opportunity Commission is the
main US Agency responsible for "enforcing federal laws that make it
illegal to discriminate against a job applicant or an employee because
of the person\'s race, color, religion, sex (including pregnancy),
national origin, age (40 or older), disability or genetic information."
[^2]

#### This bias seen in a team environment

Kelly Chao has been hired as the new business consultant at a medium
sized accounting firm, Smith and Partners. Kelly's parents are from
China, but she was born in California. She has a degree in Marketing
from the University of Washington with an emphasis in entrepreneurship.
Kelly's main role at Smith and Partners is to help the company find new
opportunities for expansion into new markets. Kelly's experience and
background has been very much focused on customer relations and sales.
She has strong analytical skills and interpersonal skills, but a very
limited knowledge of math and statistics. Her new boss, Steven Thorpe,
has been very excited to have Kelly in the team and immediately assigned
her very challenging tasks, all of which required high level
mathematical knowledge and statistics background. Because of Kelly's
Chinese background, Steven automatically assumed that she was an innate
mathematician, and assigned her tasks that were completely outside of
her skill set.

#### Effects in the workplace

Stereotyping can not only destroy confidence in teams, but can also be
very dangerous. As explained above, certain groups of people are
protected by law. Any actions based on stereotypes, if judged as unfair,
can go from unethical to illegal very quickly. Many human resources
offices constantly train their employees to help avoid such pitfalls.
This bias can, if seen in teams, can hinder the synergy in teams and
create animosity, disdain and lack of trust. As seen in "When Teams Work
Best", many employees feel slighted or that they are treated unfairly by
their leaders. Sometimes this perception is seen because of biases such
as stereotypes.

#### How to remedy this bias

As we mentioned previously in this chapter, although stereotyping can
sometimes be positive in rare team situations, we recommend avoiding
this type of bias as often as possible. Because of the nature of this
bias and the potential legal consequences associated with it, we
recommend taking certain steps to repair this problem. Data collection
should always be a priority in cases of stereotyping. In this step of
the process, one must gather information from different sources to
better understand the group that he/she is stereotyping. The more
information that is available, the better one comes to understand the
actual traits of individuals in the team being stereotyped. When
information is gathered, the team leader should compare the team
member's traits with actual stereotype traits. This process allows one
to eliminate misconceptions and misunderstandings about the team member.
Another important step is to change the group environment. Group
exercises are very helpful to bring down stereotype barriers that may be
damaging the team. These group exercises must be carefully planned to
avoid individuals to feel prejudiced against.

## Recency Bias

Managers carry the challenging responsibility of evaluating employees'
performance on an ongoing basis. They are expected to do so objectively
-- without bias -- and with the best interest of their organization in
mind. Embedded within this responsibility is the ability to maintain
employee morale and to ensure that employees remain dedicated to the
organization's mission. In doing so, managers strive to throw aside
their biases and may full-heartedly believe that they are ethically
efficient when, in fact, this may not be the case^4^.

A common problem that people encounter when processing information is
that they tend to recall recent events more clearly than those which
took place earlier and, therefore, weigh that information more
heavily^3^. This recency effect is a natural psychological condition
that has the ability to skew reality. As a result, an employee receiving
an annual performance evaluation may face unmerited positive or negative
consequences, such as a promotion or termination of employment. The
following example is one in which a dedicated employee was passed up for
promotion due to the fact that she was taking a lot of time off of work
during the end of the annual performance period:

*Rachel was a dedicated employee at her institution for the past four
years. She consistently met or exceeded target performance milestones
and was up for a promotion within the next year. Unfortunately, her
father had been diagnosed with terminal cancer and, as the only
daughter, she began taking more time off of work to help with her
father's medical care. In doing so, Rachel worked from home and on the
weekends as much as possible to make sure that her work projects
received attention. Rachel's father passed away within a matter of
months and, through her own grief, she managed the funeral arrangements
and briskly returned back to full-time work. Her manager, Scott, who had
originally recommended Rachel for the promotion, called her in for an
annual review. Rachel was astonished to find that, due to the fact that
Rachel had taken more time off than usual and temporarily had to move
some job responsibilities to other employees, she was not going to be
promoted and was also not going to receive an annual increase. Instead,
she was put on a six-month probationary review to determine her future
with the company.*

In the situation described above, although Rachel continued to meet her
performance goals, what stood out in Scott's mind was the fact that she
was taking work off and calling in more frequently over a short period
of time. He was a victim of his unconscious recency bias and failed to
consider the fact that her overall performance merited both an increase
and a promotion.

When a manager's responsibility to provide accurate feedback to
employees is poorly executed, they run the risk of losing talented
employees, reducing employee morale, and providing a negative perception
of the organization in the eyes of their employees. In order to combat
this issue, human resource representatives recommend the following:

1\. "Provide evaluations more frequently throughout the year. It is best
to do so at least quarterly to alleviate the effects of recency bias."

2\. Keep a log which lists the attributes of each employee. Each time
that you evaluate noticeable positive or negative performance actions,
update the file with notes to be used at the year-end evaluation.

3\. Gather information from various sources (internal and external
customers) who have worked with the individual throughout the year.

These suggestions are not aimed at correcting the existence of recency
bias. However, they can be helpful in combating its effects on a
manger's decision-making process.

## Curse of Knowledge

Do you assume that others are incompetent simply on the basis that you
perceive a task to be simple when others find it to be difficult? Do you
find yourself completing tasks on your own rather than delegating due to
the fact that you assume others are less capable? If you answered yes to
either of these questions, you may be suffering from the curse of
knowledge.

Managers are expected to be the expert in the workplace and, in most
circumstances, are more educated than their subordinates. It is the
manager's responsibility to ensure that his/her employees are capable of
performing assigned tasks based on their skill/education level. For
instance, if you hired someone for a job that requires an Associates
degree with two years of experience, it is unrealistic to expect them to
complete the same level of work as an employee with a Masters degree and
ten years of experience. This type of situation gives managers the
potential to influence growth in their employees while providing them
with the tools necessary to develop professionally. Lesser education
does not translate to incompetence. Rather, it is the lack of experience
that creates opportunity. The following example is one in which a
talented employee left the organization after only a few months due to
the fact that she received too little training and guidance from her
manager:

*After a rigorous 8-month search, Janice finally hired Alice as a
financial accountant for 7 of the 24 divisions within the organization.
Alice was a recent accounting undergraduate who had graduated at the top
of her class. She did not have much work experience and was elated when
she was hired into a prestigious position so soon after graduation. On
her first day, Alice received brief instructions regarding her many job
duties. She received a warm welcome from her other team members and
anticipated that the training would be ongoing. However, when she began
asking for more guidance from Janice, she was met with a frustrated
response: \"You have an accounting degree - you should be able to figure
it out on your own.\" Alice spent the next few weeks working 10- to
12-hour days educating herself on the organizational processes and
trying to build rapport with her division managers. Unfortunately, she
couldn\'t keep up with her assignments and the division managers shared
their frustration with Janice. Janice decided to demote Alice\'s
responsibilities with the disappointment that Alice wasn\'t as
intelligent as she appeared to be. Alice submitted her resignation
notice the following morning.*

In the example above, Janice was a manager with a Masters in Accountancy
and 15 years of high level accounting experience. She felt that the job
tasks for which she hired Alice were \"simple\" in terms of difficulty,
thus, they should be simple for anyone to grasp. Janice had spent the
past 8 months performing these tasks along with her own and did not want
to waste any more of her time. Unfortunately, Alice\'s resignation
forced her to start over once again with the hiring process.

It takes a great deal of resources to recruit and train a new employee
into an organization. Losing skilled employees with great potential can
be detrimental to the organization. As a manager, Janice is responsible
for ensuring that her employees have the tools necessary to carry out
their job duties effectively. These tools are not just tangible items
such as a computer and a desk. Rather, the most important tools can be
those which are intangible, such as knowledge. An education provides the
backbone for the skills we need in the workplace. However, on-the-job
training is essential for understanding the organization\'s structure
and building skills to fit within that structure. This is not to say
that managers should continuously spend the bulk of their time training
employees. Nonetheless, they should not neglect the idea simply because
they suffer from a knowledge bias. In order to combat the negative
effect of the curse of knowledge, we offer the following suggestions:

1\. Meet regularly with employees to assess their needs and discuss
professional development goals.

2\. Research developmental opportunities and allow for time to attend
trainings.

3\. Create a sign-up sheet and encourage employees to share their
expertise with their teammates during monthly meetings. Concurrently,
ask employees to list areas in which you could provide training to them
as a group.

4\. Ask your employees to complete an assessment of your strengths and
weaknesses as a manager. Some employees are more likely to be truthful
if this is done in an anonymous fashion. They may otherwise never feel
comfortable addressing issues for fear of reprimand or termination.

These suggestions are aimed at encouraging interaction among managers
and their teams. If managers fail to execute their responsibility to
their teams, they can reduce team morale, restrict opportunities for
growth, and impact team (and manager) productivity.

## Anchoring and adjustment

Anchoring and adjustment heuristic is such a powerful phenomenon which
unknowingly affects people in organizations. This could happen to people
of all walks of life. It can happen to anyone unknowingly even for one
who thinks he/she is a rational thinker. The anchoring and adjustment
heuristic was first theorized by Amos Tversky and Daniel Kahneman. In
one of their first studies, the two showed that when asked to guess the
percentage of African nations which are members of the United Nations,
people who were first asked \"Was it more or less than 45%?\" guessed
lower values than those who had been asked if it was more or less than
65%.(1). It has shown in researches that a question asked initially can
have an effect to the answer of a related or unrelated second question.

Anchoring and adjustments is a process where the mind takes short cut to
arrive to a conclusion based on the recent experience of thought
process. The mind anchors to some initial information and unknowingly
uses that information to influence the decision of the next issue. Carl
is a project manager in the IT department, who is responsible for
several software development projects. For every project he works, he is
expected to give time estimates for the entire duration of the project
to the upper management. Many times, he does not have sufficient
information at that point of time to estimate the duration. There are no
technical resources assigned, architecture not defined and he is not
sure about the availability of systems due to conflicting projects. Yet,
when he learns about the expected completion date of the stake holders
of the project, he not only decides on the duration of the project, but
also is able to provide the work breakdown of the entire project. While
the expectation of the stake holders has nothing to do with the man
hours it will take to complete a job, the anchoring effect fixes his
decision to the expected date and adjusts the estimated date from there.
The human mind works more easily with relative thinking than with
absolute thinking.

Many people get tripped up by trying to adopt a short cut rather than
thoroughly analyzing a situation. People tend to rely on false intuition
or gut feeling based on a previous experience which could open up
opportunity for this bias to show up. The primacy effect is related to
Anchoring. Primacy effect is the tendency to bases judgments on
subsequent things bases upon the very first thing. The first situation
gets sometimes gets anchored to the judgments on the subsequent things.
During an interview process, the HR manager who interviews a candidate
grades him one way if that candidate is the only person being
interviewed. The grading gets different if the candidate is not the only
one on the interview date and is being interviewed after a few people
who have been interviewed already. This could happen when the HR manager
anchors to the performance of the first candidate and evaluates the
subsequent candidates by comparing them with the first one. Anchoring
and adjustment heuristic is not always a bad thing and need not be
perceived as a defect. It is a technique humans used to make decisions
in uncertain situations. Heuristics are mental shortcuts that are used
to simplify otherwise difficult problems or tasks (Epley, 2004). It can
be a good tool to estimate certain requirements or come to conclusions
based on the only given initial information.

## False consensus

It is a phenomenon which occurs due to the overconfidence on one's
beliefs and thoughts. People make decisions and judgments under the
assumption that the ideas they have are obviously the popular ones among
the majority. There are instances where this effect leads to poor
communication and poor judgments in office environment. There is a
tendency that people present build ideas under some underlying
assumption that believe that their assumptions will be acceptable to
anyone and is not required for any discussion for approval. One could
end up making wrong decisions by falling into the trap of this bias.
Researchers say that the reason for the effect is a possible cause of
another effect called Availability Heuristic. Since people have tendency
to have a circle of friends having a similar thinking process as
themselves, they tend to believe that the rest of the world must be also
like this.

There are instances in companies where projects have failed due to the
fact that the underlying assumptions were wrong and were never brought
up for discussion or approval by an individual with this bias. Errol is
a software developer who writes programs in C language for his health
care company. There is a regulation in the company that during the
initial phase of software application development, the developers are
required to write up a document on possible exposure of personal health
information date without the patients consent. In spite of the clear
direction, Errol decided that some of the data coming from the secure
servers are still not private data. He ignored subsequent reminders and
assumed that what the decision he made with his analysis is correct and
there is no reason others need to dispute his decision. This action of
not bringing up the security violation in a timely manner caused the
project to be suspended from implementation. This had a serious impact
on Errol's focal review for that year.

## False uniqueness

False Uniqueness is the exact opposite effect of False Consensus. While
False Consensus bias make one to falsely think that their idea is the
most rational one and must be accepted by most of them, False Uniqueness
bias makes one to believe themselves that they think and make better
decisions when compared to other. This is a common effect on humans who
tend to be overconfident when making decisions.

Barbara is a business analyst in a health care company. She works in the
IT department and is part of a group which decides the requirements of
new products for customers. During the initial design discussions of the
product where each analyst puts talks about possible features to add to
the product which will be useful for the customer, Barbara proposed some
very different features which she believed that were very creative and
the most useful things for the customer. When the majority of the other
members did not show interest, Barbara believed that her proposal was
still the best which will benefit the customer and others doesn't have
seem to see the customers perspective and are rejecting valuable
features. She thought by including her ideas in the design and sending
it to the developers, he thought that when the product comes out
including her feature, it will be appreciated by customers and other
will see he value at that point. In contrary to her belief, the product
got a negative feedback because the customers did not like just like the
rest of the analysts thought about it during the initial design
meetings. This false uniqueness bias may cause one to ignore deeper
analysis and the over confidence on their judgments can possibly cause
to take wrong decisions.

## Self-Fulfilling Prophecy

A self-fulfilling prophecy is positive or negative expectation about
circumstances, people, or events that may affect a person\'s behavior
toward them in a manner that they unknowingly create situations in which
those expectations are fulfilled. An example is an employer that expects
his employees to be disloyal and lazy. He will be likely to treat them
in a way that will extract from the employees the very response he
expects. Self-fulfilling prophecy can be someone worrying about a very
important day and when that day comes their actions ruin the day because
they are expecting the day to be bad. A good example of this is prom.
Some girls think that their prom day is going to be a horrible event and
they are not going to have fun at and everything is going to be bad.
When prom day comes they are in such a bad mood that they are going to
have a bad prom that they end up ruining their own prom.

A self-fulfilling prophecy can also be a positive bias when it is used
in the right scenarios. Professional athletes can often become a self
fulfilling prophesy. They are told by their coaches when they are young
to dream big, to imagine in their minds the day they start in the
professional league. To imagine themselves walking out on to the field
and hear the crowds cheering, to picture themselves making big plays and
winning a championship. This allows them to place in their mind a goal
and a dream, once that is in place the athlete begins to work toward
that goal and make decisions in their life, consciously and
subconsciously, that will bring them to that goal of being a
professional athlete.

Self-fulfilling prophecy can lead a person to great success but I can
also hinder a person's progression. In order to avoid this there should
be precautions taken to help realize that a negative self-fulfilling
prophecy is present and something should be done to change it. They can
usually be identified by peers through meaningful communication. It is
best to talk with people that you work with often or that know you
really well that have your best interests in mind. Although
self-fulfilling prophecies can be a positive bias to have and can take
you to levels that you would not reach without them, it is important to
be aware of negative self-fulfilling prophecies and try to avoid them.

## Self Serving Bias

A self-serving bias is a bias in which people tend to enhance their
self-confidence through a variety of processes to make them feel better
about their situation. It may also manifest itself as a tendency for
people to evaluate indefinite information in a way that is beneficial to
their personal interests. Self-serving bias can also be associated with
the better-than-average effect, where the individual believes that he or
she typically performs better than the average person in areas important
to their self esteem. Self Serving bias can happen in plenty of
situations. It can be found when people rate their own driving skill,
leadership ability and kissing ability. People tend to think that their
personal ability is better than average person.

Self-serving bias can often be used to describe a history of causal
assumptions, in which praise or fault is given depending on whether
success or failure was achieved. For example, a student who gets a great
grade on a test might think, \"I got an A because I am smart and I
studied hard!\" whereas a student who did bad on an exam might say,
\"The teacher gave me a D because she does not like me!\" When someone
deliberately tries to blame external causes for their poor performance
so that they will subsequently have a means to avoid blaming themselves
for failure), it may be labeled self-handicapping. Self serving biases
can be good but the can also be harmful to a person. Sometime a self
serving bias can help you out perform what you would normally do on a
regular day. If you tell yourself that you are very good-looking today
you are more apt to be outgoing and are not a shy to talk to people. A
major pitfall of a self serving bias is that you can tend to place blame
on other people and not take personal responsibility for your own
actions. An employee that doesn't work hard at his job might think that
he will never be promoted because his boss doesn't like him, where in
actuality his boss doesn't have anything against him just wishes he
would work harder and earn the promotion.

Avoiding self-serving biases can be difficult and hard to recognize and
over come. Some self- serving biases can be good but other can be
detrimental to growth. The first step to reduce self-serving biases is
to become aware. You need to look for areas where self-serving biases
can exists and what they could potentially be. Another way of finding
out if you have a self-serving bias is to question people around you and
hold a discussion about potential self-serving biases that you may have.
Talk to people that you trust and that will give you their honest
feedback. Self Serving biases are a good way of people to achieve the
unachievable but more often than not they can lead people live in a
false reality. Self-serving biases should be watched for and limited.

## References

```{=html}
<references/>
```
3\. <http://en.wikipedia.org/wiki/Recency_effect>, March 7, 2010.

4\. <http://users.edinboro.edu/warburton/COMM710/How(un)Ethical.pdf>, ,
February 14, 2010.

5\. Tversky, A. & Kahneman, D. (1974). Judgment under uncertainty:
Heuristics and biases. Science, 185, 1124-1130.

6\. Nicholas Epley1 and Thomas Gilovich2 - 1University of Chicago and
2Cornell University


[^1]: How management teams can have a good fight. Kathleen M.
    Eisenhardt, Jean L, Kahwajy, and LJ. Bourgeois III

[^2]: USEEOC <http://www.eeoc.gov/eeoc/index.cfm>
