The South East branch was delighted to welcome 'The Risk Doctor', David Hillson, to their latest branch event; this being the 8th Alan Webb memorial lecture. Branch members gathered at Rowfant House in Crawley for the presentation on Wednesday 9th July 2014. There are many influences when groups make decisions, especially when the decision is perceived to be both risky and important. These influences can be summarised in the “triple strand” of conscious, subconscious and affective factors. This presentation reports on recent research which has revealed the main drivers of group behaviour in these situations. Understanding and managing these drivers allows groups to make good decisions – find out how. An expanded emotional literacy framework is proposed to enable groups to make good decisions by understanding and managing the underlying influences on group risk attitude.

1. © 2008-14 The Risk Doctor Partnership, Slide 1
How groups make
risky decisions
Presented by
Dr David Hillson
The Risk Doctor The Risk Doctor Partnership
david@risk-doctor.com www.risk-doctor.com

2. © 2008-14 The Risk Doctor Partnership, Slide 2
Acknowledgement
The ideas and concepts in this
presentation were developed
jointly with
Dr Ruth Murray-Webster
See www.RARA-risk.com

3. © 2008-14 The Risk Doctor Partnership, Slide 3
What’s the problem?
Everyone has to make decisions
Personal, private, professional …
All decision-making is risky and important
Decision process/outcomes are uncertain
Decision process/outcomes matter

4. © 2008-14 The Risk Doctor Partnership, Slide 4
Sounds familiar ?
Risk can be defined as “uncertainty that matters”
Can risk management help decision-making?
Human element is essential in both RM and DM
All risk is managed by people
All decisions are made by people
Groups are more complex than individuals
Multiple influences on group decision-making
Link risk management & decision-making
through risk attitude

5. © 2008-14 The Risk Doctor Partnership, Slide 5
Two-part solution
Understand so we can manage
Need to understand & manage:
1. Risk attitudes
2. How decision-making groups operate

6. © 2008-14 The Risk Doctor Partnership, Slide 6
Understanding “risk attitude”

7. © 2008-14 The Risk Doctor Partnership, Slide 7
“Risk Attitude” = “Risk” + “Attitude”
Attitude: “Chosen response to given situation”
Risk: “Uncertainty that matters”
Both are affected by perception
“What is the situation?”
“How uncertain is it? How much does it matter?”
Risk attitude: “Chosen response to uncertainty that
matters, influenced by perception”
Many levels: individual, group, society, nations…
Exists on a continuous spectrum

8. © 2008-14 The Risk Doctor Partnership, Slide 8
RISK
SEEKING
RISK
AVERSE
RESPONSETOUNCERTAINTY The risk attitude spectrum
–
+
RISK
TOLERANT
RESPONSETOUNCERTAINTY
–
+
All images from FaceTrace™
© Copyright BrainJuicer 2006

9. © 2008-14 The Risk Doctor Partnership, Slide 9
What influences perception?
“Triple strand”
Conscious
factors
(situational
assessments)
Subconscious
factors
(heuristics and
cognitive bias)
Affective
factors
(feelings and
emotions)
… together influence
perception & risk attitude
“Triple strand” is copyright © 2007
David Hillson & Ruth Murray-Webster

10. © 2008-14 The Risk Doctor Partnership, Slide 10
Conscious factors
Make your mind up
Rational decision-making
Measurable criteria
Situational aspects

11. © 2008-14 The Risk Doctor Partnership, Slide 11
Heuristics = “Rule of thumb” / “Gut feel”
Individual availability, anchoring, confirmation trap…
Group groupthink, risky shift, cultural conformity…
Cognitive biases
Familiarity Level of relevant skill/knowledge/expertise
Manageability Possibility of control or choice
Proximity Closeness of risk in time or space
Propinquity Potential for direct consequences
Subconscious factors

12. © 2008-14 The Risk Doctor Partnership, Slide 12
Affective factors
Feelings, emotions, instincts & intuition
How do I feel?
BEHAVIOUR
WONDER
DESIRE

13. © 2008-14 The Risk Doctor Partnership, Slide 13
Understanding how groups operate

14. © 2008-14 The Risk Doctor Partnership, Slide 14
Possible influences on
decision-making groups
Individuals in group with various levels of power
Group dynamics
Decision context
Organisational culture
Wider environment
Societal norms
National culture

15. © 2008-14 The Risk Doctor Partnership, Slide 15
Are these factors all equal?
 “Ripples in pond ” hypothesis:
 Influence directly proportional to propinquity
 “How much does it matter to me/us?” (closeness)
 Closer to decision = stronger influence
 Two-phase research to test
1. Rich interpretative analysis of real decisions (x 8)
2. Web-based survey (x 281)
[Ref: “Managing Group Risk Attitude” by Ruth Murray-Webster & David Hillson, pub. Gower 2008]

16. © 2008-14 The Risk Doctor Partnership, Slide 16
Research results
a
b
c
d
e
f
g h
a
b
c d
e
f
g h
0.2
0.4
0.6
0.8
1
Normalisedrankingscore
Strength of influence score (Q5)
Mean ranking score (Q6)
Two distinct groups: Primary (a-e), Secondary (f-h)

17. © 2008-14 The Risk Doctor Partnership, Slide 17
Research results
Primary factors
a Individuals with high power
b Individuals with high propinquity
c Organisational culture
d Decision context
e Group dynamics
Secondary factors
f Individuals with low power
g Societal norms
h National culture
a
b
c
d
e
f
g h
a
b
c d
e
f
g h
0.2
0.4
0.6
0.8
1
Normalisedrankingscore
Strength of influence score (Q5)
Mean ranking score (Q6)

18. © 2008-14 The Risk Doctor Partnership, Slide 18
Five primary factors
Closer analysis:
Two co-equal “lead influences”
Linked by group dynamics
Secondary factors less influential
Stakeholders
with highest power
and propinquity
Situation
Decision context underpinned
by organisational culture
Group Dynamics
(the bridge)

19. © 2008-14 The Risk Doctor Partnership, Slide 19
“Bow wave” not “Ripples”
Lead influences (primary) first …
… followed by supporting influences (secondary)

20. © 2008-14 The Risk Doctor Partnership, Slide 20
“Bow wave” not “Ripples”
Directionoftravel
Primary
factors
3. Group dynamics
1. Lead influence:
Either (a) stakeholder factors
Or (b) situational factors
2. Supporting influence:
Either (a) situational factors
Or (b) stakeholder factors
Secondary
factors

21. © 2008-14 The Risk Doctor Partnership, Slide 21
Implications
Group behaviour is mainly influenced by:
Either a strong leader, who can supersede
situational factors (context & culture), with
group dynamics following the leader;
Or strong situational factors, with
influential individuals adapting to fit, with group
dynamics following the context & culture

22. © 2008-14 The Risk Doctor Partnership, Slide 22
Bringing it all together

23. © 2008-14 The Risk Doctor Partnership, Slide 23
How groups make risky decisions
Wide range of influences on DM groups
Stakeholders, Situation, Group dynamics
Risk attitudes affect individuals & group
Influenced by “triple strand”
Complex! Difficult!! Important!!!
Addressing risk attitudes can help, leading to
optimal decision-making

24. © 2008-14 The Risk Doctor Partnership, Slide 24
So much for understanding,
what about managing?

25. © 2008-14 The Risk Doctor Partnership, Slide 25
Managing risk attitudes
Key: Risk attitudes are chosen
Can be modified if necessary
Yes, but how?
Use techniques from emotional literacy

26. © 2008-14 The Risk Doctor Partnership, Slide 26
Basic Emotional Literacy
1. Recognise emotions
 …and acknowledge them as entirely natural
2. Understand emotions
 Why do I/we feel them, do they help or
hinder?
3. Appropriately express emotions
 …in a way that supports my/our objective
4. Deal with emotions
 Don’t have to be a victim
The Four As
Awareness
Appreciation
Assertion
Action

27. © 2008-14 The Risk Doctor Partnership, Slide 27
A good start, but…
The Four As can apply to group decision-making
… but they are not the whole story
Need to be Aware of group behaviours and
influences (especially primary factors)
… and Appreciate why they are happening
… then Assert the need for change
… and take appropriate Action to achieve it
REALLY ? ALWAYS ???

28. © 2008-14 The Risk Doctor Partnership, Slide 28
From Four As to Six As
Assertion and Action not always required
Sometimes unmanaged situation is fine
Need to Assess whether change is needed
If not, can Accept status quo (and monitor)

29. © 2008-14 The Risk Doctor Partnership, Slide 29
The Six As Model
Assessment
Assertion
& Action
Intervention
required
Acceptance
Intervention
not required
Awareness & Appreciation of
Stakeholder
factors
Situational
factors
Group
Dynamics
Monitor&review
Monitor&review

30. © 2008-14 The Risk Doctor Partnership, Slide 30
Practical steps – 1
Seek awareness of:
Self and others in decision-making group (levels of
power and propinquity)
Situational aspects (organisational culture, decision
context)
Group dynamics, including “triple strand” influences
Facilitation can promote awareness and uncover
bias in a non-threatening way

31. © 2008-14 The Risk Doctor Partnership, Slide 31
Develop appreciation of stakeholders & situation
Empathy for others’ point of view
Confidence in your own perspective
Understanding of decision context
Knowledge of organisational culture
Practice makes perfect
Mentoring/coaching & honest feedback can help
Practical steps – 2

32. © 2008-14 The Risk Doctor Partnership, Slide 32
Risk is not managed by robots but people
Decisions are not made by robots but people
Human psychology is major influence in both
Risk attitudes are key
And finally …

33. © 2008-14 The Risk Doctor Partnership, Slide 33
Awareness &
Appreciation
Assertion
& Action
Acceptance
Assessment
or
And finally …
Group decision-making is risky & important
Complex web of influences
Research indicates set of primary factors
Stakeholders, situation, group dynamics
Managed risk attitudes are vital
Modified emotional literacy offers framework
The Six As Model

34. © 2008-14 The Risk Doctor Partnership, Slide 34
For further information:
Dr David Hillson
The Risk Doctor Partnership
Tel +44(0)7717.665222
david@risk-doctor.com
www.risk-doctor.com
www.RARA-risk.com