# 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. 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.”

#### 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

* ↑ How management teams can have a good fight. Kathleen M. Eisenhardt, Jean L, Kahwajy, and LJ. Bourgeois III
* ↑ USEEOC http://www.eeoc.gov/eeoc/index.cfm
3., March 7, 2010.
4., , 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