Leaders can make better decisions by tapping into the collaborative intelligence of their organizations
August 9, 2019
by Rafael Mira, Leticia Soberón, and Chema González-Garilleti
In today's fast-changing world, organizations must continuously adapt and reinvent themselves to survive and create value. According to McKinsey & Company, in 1935, the life expectancy of an S&P 500 company was 90 years. By 2010, life expectancy had dropped to just 14 years — and studies show that it’s getting even shorter. To succeed in this environment, leadership teams need to rapidly identify, select, and carry out an increasing number of bold initiatives and projects.
Unfortunately, very few (if any) leadership teams have enough information on their own to consistently make the best decisions about which initiatives to tackle. The knowledge required to answer strategic questions is stored in the minds of many employees who are spread throughout the organization – across different seniority levels, departments, functions, and roles. But so far the tools for tapping into this diffuse knowledge, such as email and meetings, have been generally inefficient and often ineffective.
In this article we will outline the main barriers that senior leaders encounter when trying to access knowledge spread across their organizations, and describe an approach that we call “collaborative intelligence” that can help address those barriers by leveraging digital deliberations technology.
Barriers to accessing the knowledge within an organization
Good decisions require deliberation among all people who can add value. But deliberation requires more than one-directional communication or debating. In deliberations, people have the opportunity to share their insights around a concrete problem or question, to exchange points of view, and to modify their own or others’ opinions.
Promoting effective deliberation, particularly across a highly-dispersed organization, isn’t easy. Based on interviews and workshops conducted with more than one hundred senior leaders of Fortune 500 companies, we’ve identified four main obstacles:
The information and judgment necessary to make sound decisions is stored in the minds of people who are spread out across different groups (such as top management, board members, customers, suppliers, and advisors). It is important to distinguish between strategic and operational decisions. Artificial intelligence and big data can help process large amounts of information – if previously stored – and can be used to automate some operational data-driven decisions. However, strategic decision-making requires going beyond the quantitative data sets that feed AI algorithms. Ultimately, the best data source for strategic decision making is the judgment of the employees who make up the organization. Judgment is understood to be a fusion of people’s interactions, knowledge, reasoning, experiences, and creativity.
Current methods used to access the knowledge within an organization (meetings, email, communication tools, and surveys) have severe limitations. Communication tools and resources are designed to exchange information and messages, not to engage in structured deliberation. By way of example, consider in-person meetings: senior leaders spend most of their time in face-to-face meetings, but there is a finite number of participants who can attend a meeting and meaningfully contribute to a deliberation. To make matters worse, the efficacy of meetings decreases as the number of people increases, due to space and time limitations. This forces leaders to rely on the same handful of advisors, preventing them from accessing the knowledge that exists elsewhere within their organizations. Digital communications tools (such as email, WhatsApp, and Slack) do not address the limitations of face-to-face meetings. Interactions within these tools flow in a chronological order, which buries arguments and insights in a thread, complicating collective understanding and hindering iteration on proposed ideas. Surveys also fail to overcome these limitations. While they are useful for collecting self-reported data from study participants, surveys do not allow people to engage in deliberations that enable knowledge co-creation.
Strategic decision-making processes are affected by cognitive biases and noise. When we make decisions, there are subtle ways that our minds might lead us astray at a subconscious level. Some ways we mislead ourselves, for instance, are when we rely too heavily on the first piece of information offered, remain committed to something we have said in the past, or default to what everyone else is doing. The prevalence of biases in corporate decisions is partly a function of habit, training, and corporate culture. Fundamentally, biases are pervasive because they are a product of human nature. In addition to being aware of our biases, the Nobel prize-winning psychologist Daniel Kahneman reminds us of the importance of reducing noise in conversations. Humans are unreliable decision makers; their judgments are strongly influenced by irrelevant factors (noise), such as their current mood, or an isolated experience they had recently. Academic researchers have repeatedly confirmed that professionals often contradict their own prior judgments when given the same data on different occasions.
Leaders are reluctant to ask employees for their input and to involve them in important decisions of the organization. Decision making is among a leader’s main responsibilities. However, many leaders prefer to avoid exposing themselves to a potential failure by choosing inaction over a difficult decision. Indecision does not result in a neutral outcome; rather, it can postpone or worsen a negative outcome. Leaders tend to falsely assume that asking for help can be perceived as a weakness, fault, or flaw. In a business environment characterized by accelerating change and increasing uncertainty, it is crucial for leaders to identify and acknowledge which decisions fall within their current circle of competence - topics in which they have extensive and relevant knowledge. For important decisions outside that circle, decision makers need to be willing to gather the relevant knowledge spread across their organizations. Leaders will continue to be the ultimate decision makers, but they should embrace an approach that actively encourages new perspectives and collaborative solutions, in which employees understand that their input is needed, valued, and considered.
How collaborative intelligence can help address those barriers
Collaborative intelligence is the process by which the knowledge of each member of a group emerges and integrates with others’ knowledge, resulting in better-informed recommendations and an outcome that is smarter than the sum of each individual contribution. Collaborative Intelligence is not a novelty: the term’s usage began in the 80s, linked to studies of social behaviors of bacteria. Social networks were seen as the foundation for next generation problem-solving ecosystems, modeled on the process of evolutionary adaptation found in nature's ecosystems.
Collaborative intelligence is the process by which the knowledge of each member of a group emerges and integrates with others’ knowledge, resulting in better-informed recommendations and an outcome that is smarter than the sum of each individual contribution.
However, the recent development of digital capabilities has permitted the application of the term’s principles in business organizations. To provide an understanding of the practical applications of Collaborative Intelligence in business and its many advantages, we have provided some ideas below:
It creates "digital deliberations," conversations in which a significant amount of people gather in a structured virtual space where they can share their knowledge and interact with each other. Physical world barriers such as time (i.e. length of meetings or alignment of people’s agendas) and space (i.e. people working from different locations) are no longer a limitation.
Technology allows us to design different digital spaces according to the nature and goal of each deliberation. In contrast, typical tools such as mail or instant messaging only offer one structure to exchange information, forcing people’s contributions to follow a chronological order which often leads to the best arguments being buried and lost within the conversation. By relying on traditional methods for structuring conversations, organizations are limiting their possibilities. However, digital deliberation tools are designed to consider the objective of each decision (i.e. a yes/no decision, rank a list of options, generate ideas, collect feedback, etc.). Such tools also include elements to reduce the cognitive biases and noise present in traditional means of interaction, like blind arguments or anonymous contributions.
The digital nature of the deliberation generates a significant amount of KPIs that can be used to measure progress (e.g. identifying which type of decisions are made faster with Collaborative Intelligence, determining the main contributors, highlighting the most highly voted arguments, answering interrelated questions, etc.) and to reward and recognize the contribution of the members of the organization. This helps to create a culture where employees want to contribute and share their knowledge, and leaders want to involve anyone who can add significant value.
Our research suggests that collaborative intelligence is helpful in any business case in which there are insights and knowledge spread across different minds in the organization. There are many cases where collaborative intelligence can promote better decision-making: from organizational re-designs, to strategic plan elaboration, project assessments, commercial and technical proposal evaluations, event planning, cultural transformation, and innovative suppliers benchmarking - just to name a few.
Collaborative intelligence in action
Consider a real case to illustrate the benefits of leveraging collaborative intelligence. During the last 2 years, we have worked with the supply chain department of a large Consumer Goods company in Europe. The organization includes more than 20,000 employees distributed across a multi-dimensional matrix of siloed business units, horizontal functions, and geographies. The leadership team was determined to tap into the knowledge of such a diverse organization to identify opportunities to improve operational efficiency. For this purpose, it was crucial to enable team leaders to get feedback from those closer to the actual work.
The initiative to get this knowledge lasted 12 months and achieved the ambitious objective: approximately 8,000 employees participated, sharing more than 15,000 insights across more than 200 digital deliberations. As an example, more than 500 employees participated in a digital deliberation lasting 72 hours to jointly identify and discuss the pros/cons of outsourcing some technical developments that were currently done in-house. The deliberation was conducted using a tool that grouped people’s contributions into two buckets: in favor or against the outsourcing. Employees waged debates that argued different sides of the issue, providing the rationale behind their positions, and reviewing and commenting on others’ contributions. This was a dynamic process in which participants engaged in discussions around the most relevant arguments and voted for the most compelling ones, with the option to change their initial position at any point. The output was the percentage of participants in favor/against and the most highly supported arguments for each side. The structured and curated output of the discussion and massive participation helped the project team better define the way forward for a very sensitive topic.
The main benefits of the process were increased agility (by avoiding bottlenecks on the development process), and cost reduction (by partnering with a freelancer community - staff on-demand - instead of relying on a full-time dedicated workforce). The decisions made as a result of the process were not only better accepted by employees, but more importantly, they were also better accepted by the company's leadership. It was in the latter group where we encountered the biggest change. One of the main reasons that satisfaction improved within the organization was that everyone saw that the collaborative intelligence approach was a means of finally solving and overcoming challenges that had been present in the organization for a long time. Most importantly, the execution of the decision was conducted by a very engaged and accountable group of employees who had participated in the deliberations. As a consequence, leaders felt decisions were better (faster and much more informed with elaborated arguments) and easier to implement since they were backed up by the employees affected by each different issue.
The knowledge captured throughout the more than 200 deliberations triggered different actions, ranging from quick and simple interventions to complex projects involving multiple organizations. In parallel, it brought two side benefits:
It helped to share and re-apply best practices across the organization since some of the opportunities identified had been already tackled.
The collaborative approach facilitated the translation of the ideas into action as the people executing them felt more engaged and accountable after being involved in the decision process.
A few months ago, another Fortune 500 company conducted an organizational redesign using digital deliberations to tap into the collaborative intelligence of the organization. There are various approaches to internal organizational redesign. Most of them share a common feature - that a selected group of employees (usually part of the leadership) go through a series of meetings to identify what to change/keep in different areas: such as rewards, reporting relationships, staffing, and goals, among others - depending on each specific case. The traditional approach is influenced by ‘who’ those selected employees are, and by ‘how’ they weigh the impact of the issues identified, along with their potential interventions. Contrast this with the organization's new approach, which relied on collaborative intelligence: they conducted a digital deliberation in which they involved hundreds of employees to jointly discuss an organization redesign process that could:
Better identify and quantify the issues and potential interventions,
Reduce the bias inherent to the ‘selected’ group of employees helping to deliver a better output overall, and
Facilitate the deployment of the new design
How did it happen? (1) was achieved by involving and giving voice to the employees that were experiencing the issues first-hand. (2) was addressed by involving all employees with valuable knowledge around the issue, and not limiting the decision to ‘selected’ employees. Finally, (3) was implemented by employees who were involved throughout the journey, so that it would not feel like one more top-down deployment, but instead like a solution that they themselves had helped to define. As a result, leaders saw unprecedented progress on a decision around a sensitive and controversial topic (one where it was difficult to reach an agreement). The process also fostered learning and exchange of ideas, fueled innovation, and improved team’s overall performance.
There are several challenges to the collective intelligence approach. On the one hand, it is important to ensure that there is a willingness and conviction among leaders (especially hierarchical ones) to collaboratively deliberate organizational issues. On the other hand, the employees involved in the deliberation tend to have concerns about sharing their opinions freely. The latter challenge can be mitigated by technology. Digital deliberation tools include elements that can reduce that anxiety by offering the option to deliberate anonymously. Employees lose their fear of judgment or career penalties, which is a common hurdle when leaders try to collect the knowledge required to make a decision that could be beneficial or harmful for the participants involved.
How to foster collaborative intelligence in your organization
Collaborative intelligence in organizations allows for a more productive, orderly, and stimulating deliberation around the organization’s most pressing challenges and decisions. The goal is to facilitate a more holistic understanding of problems, thus generating new and improved insights and perspectives.
In our work with dozens of Fortune 500 companies, and after evaluating over 4,000 strategic decisions among leadership teams that have relied on collaborative intelligence, we have identified the following key steps:
Embrace a leadership model in which executives shift from having all the answers to identifying the most relevant questions. Leaders that leverage collaborative intelligence to make decisions can focus more on identifying and prioritizing the organization’s most relevant challenges. This is a natural consequence of acknowledging the likelihood that they do not possess all relevant knowledge to make optimal decisions, but are instead responsible for identifying and prioritizing the company’s efforts. In the case we just exposed, the leadership team had been struggling to find solutions for each specific issue that arose, instead of taking the time to analyze them and uncover their root causes.
Rely on digital solutions specifically designed to enable collaborative intelligence deliberations. With an increasing number of digital solutions available, it is paramount to select the most suitable technologies to facilitate people’s deliberation. Ideally, they should use digital tools that have a structure that is tailor-made to the specific goal that the organization is trying to achieve with the deliberation (make a yes/no decision, prioritize a list of options, collect feedback, or allocate limited resources, among many other options). Enabling successful deliberation requires tools that allow users to engage in structured conversations, to interact with each other, and to elevate the most relevant insights. Most mainstream communication and project management tools do not offer this depth of flexibility. For instance, WhatsApp and Slack are designed for instant communications, email for daily simple communications, and solutions like OneDesk or Asana for project management. That said, there are tools that are specifically designed to avoid cognitive biases and noise, enabling intelligent deliberations among numerous members in diverse groups, such as Collaboratorium. In the case we described, we used a digital deliberation template that forced participants to position themselves in favor or against, and explain their rationale. This structure of deliberation avoided conditional answers (i.e. “yes if x or y happens” or “yes, but bear in mind x”) that typically paralyze the decision-making process for leadership teams.
Identify the people who should be empowered and trained to play a leading role in organizational change. Deliberation around important issues generates different and relevant points of view. Important decisions are made well when they address the specific contention points that lead to conflicting understandings. Senior leaders can rely on people’s contributions in these strategic deliberations to identify those who possess the relevant competences to lead the change. Empowering them will provide a sturdy bridge between the organization’s decisions and their practical execution. Ultimately, the collaborative approach will help senior leaders propel the company forward at a faster speed, instilling a new culture of engagement and accountability across the entire organization. As the case illustrated, leaders were identified and then made responsible for executing the decisions based on their contributions, proposals, and expertise.
Measure and recognize contributions to deliberation. Collaborative intelligence can be undermined if employees throughout the organization are not acknowledged for their contributions. Leaders need to create an environment in which successful deliberation increases employee engagement and motivation, and where employees feel their input is valued and translated into prompt decisive action. This will help those involved feel responsible for their contributions to the process as well as for the overall effectiveness of the process. In our case, this was done mainly by two non-financial rewards and recognitions: meaningful praise from the leadership team, and opportunities to lead projects granted to top contributors, which could help to propel their careers forward.
In today’s complex environment of ever-changing priorities, leadership teams should acknowledge that they themselves do not possess all of the relevant knowledge to make optimal decisions, and that their responsibility lies primarily in identifying and prioritizing the company’s efforts. Adopting the measures mentioned above will help leadership teams tap into the collaborative intelligence of their organizations and make decisions that are faster, better informed, and easier to implement.
About the Authors
Rafael Mira is co-founder of collaboratorium and co-creator of The Innovation Center for Collaborative Intelligence. He worked previously as a venture capitalist, serial entrepreneur, and McKinsey & Company Partner. He holds an MBA from the Kellogg School of Management at Northwestern University.
Leticia Soberón is co-founder of collaboratorium and co-creator of The Innovation Center for Collaborative Intelligence. She holds a PhD in Social Sciences - Connective Intelligence from the Pontifical Gregorian University. She has researched CI for decades, and created several organizations in the field.
Chema González-Garilleti is co-founder of collaboratorium and co-creator of the Innovation Center for Collaborative Intelligence. He is an entrepreneur and previously worked at McKinsey & Company and Amazon.com. He holds an MBA from the Haas School of Business at University of California, Berkeley.
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