Why do some managers prefer action over the status quo?
04/10/2024
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Managers constantly face choices between doing something and doing nothing, committing themselves to action, change or simply retaining the status quo. While some take decisions without too much rumination, others spend more time and effort deliberating. A new study by Melvyn HAMSTRA from IÉSEG has analyzed how instinctive behavioral traits impact the way managers make decisions.
Decisions involve time and resources
Making decisions is one of the core activities for any manager. With the responsibility for their choices, managers generally look to avoid making the wrong decisions. Nevertheless, these choices involve time, deliberation, resources and, according to Professor HAMSTRA, are impacted by the managers’ personal experiences (what he refers to as history-based biases).
He carried out an experiment involving over 150 managers to study this in more depth. He drew on regulatory focus theory, a psychological theory developed in the US that outlines that human motivations are driven by two specific dispositions: the pursuit of accomplishments and advances via action (known as the promotion focus); or alternatively by the goal of maintaining stability and security (prevention focus).
Professor HAMSTRA examined how these behavioral foci would impact the way managers review information to make decisions in uncertain situations.
Decisions based on intuition?
For example, imagine a manager could change an important process or system for his/her department but may not be sure how or whether this would really improve operational performance.
“How do they make a decision? Based on their intuition or do they seek more information to avoid having any regrets down the line?” says Prof HAMSTRA.
It has often been assumed that managers more readily opt for a status quo to avoid mistakes or errors because taking action involves deviating from what is considered normal. However, for some managers it is more intuitive to choose action over inaction, explains the expert, even if there are risks involved or evidence to prove doing nothing may be the better option. These behavioral traits are often established during childhood, he explains, and can be the result of the way we are rewarded or punished for different actions or doing nothing.
Fictive business scenario
In the experiment, the researcher used a questionnaire to measure the behavioral inclinations of the managers. They were then presented with a fictive business decision scenario in which they faced the choices of acting or simply retaining the status quo. The experiment provided managers with specific evidence that one of the two options was better.
“I set out to test what would happen when the advice would go against the manager’s personal bias. For example, how would managers with a preference for action (promotion) react when the evidence suggested they should do nothing.”
The study showed managers will deliberate more and gather more information when it goes against their personal intuition.
“Managers with a prevention disposition requested more reviews and information when they were advised to commit action. In contrast, those with a promotion focus ruminated more when they were advised to do nothing,” he explains.
Potential applications to explore
This work highlights that it can be useful, therefore, for managers to understand and recognize their tendencies in terms of action and inaction.
It is then possible to explore potential avenues for adapting decision-making at either the individual or organization level. “A manager or organization may want to look at ways for either speeding up or slowing down the decision-making process”.
For example, managers with a prevention tendency may wish in certain circumstances to make it easier to make a rapid decision when change or action are proposed. This could be the case in certain business environments where speed and risk-taking are key.
On a personal level, the researcher says that managers can draw on past experiences where they have acted counterintuitively, while at an organizational level – he says companies can think about the norms they portray or the behaviors they model, as these would be able to make certain choices seem more normal and as such influence the options that managers feel right about choosing.
Article: How much information to consider when choosing action to change? The impact of managers’ promotion versus prevention focus (Journal of Managerial Psychology, 2024) Melvyn R.W. Hamstra (IESEG School of Management, UMR 9221 – LEM – Lille Économie Management, Lille, France).
