Group Decisions and Individual Decisions
The decisions that we make do not exist within a vacuum – they typically affect other stakeholders, and we often need to gather the input of others in our decision making processes. We often attribute decisions to groups, such as “the group of coworkers decided to go to the Italian restaurant for lunch” or “Company X decided to buy Company Y”. But what do these statements really mean?
When you and some coworkers decide where to go for lunch, the conversation might go something like this:
You: Do you want to get a burger?
Coworker 1: I just had a burger yesterday, how about the Italian place?
Coworker 2: Yeah that sounds good.
You: Sure, let’s do it.
In this example, a consensus was reached by the coworkers. An initial idea was proposed, and a different idea that was agreeable to all parties was identified and selected. The process involved each individual making the decision to get Italian food, and what emerged was a consensus.
Now let’s consider the case of one company buying another. When we say that a company decides to do something, we usually mean that a decision was made by a top leader within the organization with the proper decision making authority (e.g., the CEO). In other words, the company itself didn't decide to do something (whatever that might mean), but the leader made the decision on behalf of the company.
In both cases, and in general with examples like these, it is a convenient linguistic shorthand to say that the “group decided” to do something. But in reality, a group cannot decide anything. Only individuals can decide and act. As the famous economist Joseph Schumpeter said:
"For only individuals can feel wants. Certain assumptions concerning those wants and the effects of satisfaction on their intensity give us our utility curves, which, therefore, have a clear meaning only for individuals.… Society as such, having no brain or nerves in a physical sense, cannot feel wants and has not, therefore, utility curves like those of individuals. Again, the stock of commodities existing in a country is at the disposal, not of society, but of individuals; and individuals do not meet to find out what the wants of the community are. They severally apply their means to the satisfaction of their own wants." (1)
Any case of so-called group decision making can be re-framed as essentially two parts - A) individual decision making, and B) the accompanying group dynamics that go along with it.
This is not merely a semantic argument. How decision making is framed can have very practical purposes and consequences. Recognizing that decision making is a uniquely individual activity can aid in framing and facilitating decision making processes and dynamics within a larger group. For example:
- What rules should members of the group follow in reaching a decision? Does it have to be a unanimous consensus or simply a plurality? Or is there only a single individual vested with decision making authority, and the goal is to try to persuade them in one direction or the other?
- Will voting take place, and what voting scheme should be used?
- What is the best way to avoid the common pitfalls that groups find themselves falling into, such as groupthink? How do you avoid one loud individual from derailing the conversation?
- What is the ideal composition and size of groups for various problems and tasks?
Designing a good decision making process for a team, department, or organization is critical to ensuring that everyone is heard and that valuable contributions are considered. A clear process also reduces confusion and streamlines the decision making process. This starts with a recognition of where decisions originate – i.e., inside each of us individually. From there, by designing and institutionalizing good decision making processes, companies can integrate the knowledge and opinions of individuals to make decisions which benefit the organization as a whole.
At Collier Research Systems, we specialize in decision making. Whether it involves a single individual or a group of individuals, we can develop tools and processes to help you make good decisions. Visit www.collierresearchsystems.com.
(1) Joseph Schumpeter (1909) On the concept of social value. The Quarterly Journal of Economics, Vol. 23, No. 2, pp. 213-232.