What the Review Is Allowed to Change

An organisation can improve its performance while learning too little about whether its objective is still worth pursuing.

Bad news about an investment can make its author put more money into it. In Barry Staw’s experiment, 240 business students allocated research funds within a fictional company. Some chose the original investment; others inherited it. Those who had chosen it and then received unfavourable results committed the most additional resources to the same division. Receiving evidence of failure had not simply prompted a search for a better destination for the money (Staw, 1976). strategy.sjsu.edu

These were simulated decisions, not executives risking their livelihoods. Nevertheless, the finding exposes a difficulty that survives outside the experiment: receiving information does not determine what someone will allow it to change. An organisation can examine disappointing results carefully while leaving the original decision beyond examination.

Consider a hypothetical company whose sales have fallen. Its managers decide that the team needs more persuasive conversations. They practise pitches, record objections and review performance weekly. Some skills improve. Yet the decline may also involve customers questioning the product’s value. Better selling could help, but the review has already narrowed the range of explanations it can investigate.

A practical interpretation model offers a way to reopen that range. It starts with a shared event and considers different accounts of its meaning, each capable of directing a different response. Optimism might treat a difficult period as training; caution might see evidence of a changing market. Their usefulness depends on what they lead someone to investigate. Merely choosing the more encouraging account cannot establish its accuracy.

There is evidence for making alternative possibilities explicit. In an experiment on evaluations of purported research about capital punishment, students instructed to consider whether they would judge a study similarly if its conclusion were reversed showed less biased evaluation than those instructed to be fair and unbiased. This was a particular judgement task, not a demonstration of better corporate strategy. It suggests, however, that an instruction to think fairly can leave the method of thinking untouched (Lord et al., 1984). Academia

For the sales team, an alternative interpretation becomes useful when it changes the evidence requested. A seasonal explanation invites comparison with previous periods; a concern about product value invites investigation of why customers decline or leave. Which findings would distinguish weak selling from an offer customers no longer want? The perspectives need to generate distinguishable expectations. Otherwise, a meeting can accommodate several opinions without testing any of them.

A framework of behavioural compounding describes a further cycle: a thought guides a decision, an action follows, repetition supplies experience, and analysis informs the nextdecision. Its attractive promise is that small corrections accumulate. The term is a metaphor; it does not establish a regular rate of improvement. What the cycle carries forward can include an untested explanation alongside an increasingly practised action. A team can repeatedly improve its pitch while becoming more committed to selling a proposition that needs revision.

Chris Argyris gave this difference useful language. In single-loop learning, errors are corrected within existing goals and rules. Double-loop learning allows those goals and rules to be questioned. The sales team changes its script in the first case; in the second, it examines the belief that persuasion is the central problem. This is an organisational account of learning, rather than proof that questioning everything improves performance (Argyris, 1976). scispace.com

The distinction also concerns authority. If the director treats doubts about the product as excuses, employees may learn to report only problems with the pitch. The meeting can produce increasingly detailed feedback within that permitted subject. More analysis will not, by itself, expand what people are allowed to challenge. A review’s scope is partly established before anyone presents the numbers.

Sun Tzu’s planning framework provides an older way of resisting this confinement. In Lionel Giles’s translation, preparation compares collective alignment, seasonal conditions, terrain, command, and organisation and discipline. These factors make strength dependent on circumstances. For the sales campaign, a business analogy would examine whether the available skills and incentives suit the task, and whether market conditions still favour it. Improving performance inside the existing routine answers only part of that assessment. The reasons for selecting the campaign have to remain available for scrutiny. The text also permits plans to change as circumstances change (Sun Tzu, 1910). Project Gutenberg

Its account of prolonged campaigning adds something a performance review can omit: continuing changes the conditions of future action. Supplies are consumed and strength is exhausted. This is military reasoning, not an empirical law about companies. Applied cautiously, it directs attention towards the resources spent keeping a strategy alive, including capacity that cannot simultaneously serve another purpose. Project Gutenberg

The hypothetical company might eventually restore sales. During the attempt, however, its managers may have spent months improving persuasion while postponing changes to the product. Evaluating the campaign only by whether it can succeed misses what continuing prevents. The remaining decision concerns the next commitment of resources, even when earlier expenditure makes stopping painful.

Persistence still deserves a fair hearing. A temporary setback can accompany worthwhile development, and abandoning a project may incur substantial costs. Uncertainty does not disappear when someone proposes an alternative. A sensible review therefore compares the remaining prospects and consequences of continuing with those of changing course. Duration alone cannot settle the question.

Nor is presenting alternatives an automatic remedy. A meta-analysis found opportunity-cost information associated with less escalation overall, but the relationship between personal responsibility and escalation was stronger in studies presenting that information. The authors noted that much of the literature involved laboratory studies. The result complicates the assumption that a clearer account of what has been forgone will reliably loosen commitment (Sleesman et al., 2012). researchgate.net

One practical consequence is to establish what evidence could justify revising the objective while agreement is still provisional. For the sales campaign, that might include a pattern of customers rejecting the product’s value despite improved conversations. Such a condition needs scrutiny too; a rigid stopping rule can misread a changing situation. Its value is to preserve a question that enthusiasm might otherwise remove.

When the team returns to its sales figures, there are now two kinds of progress to examine. It may have learned to hold better conversations. It may also have learned something that makes the original campaign less defensible. The people who invested most in improvement need room to report that second result without having their useful work treated as wasted.

References

Argyris, C. (1976). Single-loop and double-loop models in research on decision making. Administrative Science Quarterly, 21(3), 363–375. Stable URL.

Lord, C. G., Lepper, M. R., & Preston, E. (1984). Considering the opposite: A corrective strategy for social judgment. Journal of Personality and Social Psychology, 47(6), 1231–1243. https://doi.org/10.1037/0022-3514.47.6.1231.

Sleesman, D. J., Conlon, D. E., McNamara, G., & Miles, J. E. (2012). Cleaning up the big muddy: A meta-analytic review of the determinants of escalation of commitment. Academy of Management Journal, 55(3), 541–562. https://doi.org/10.5465/amj.2010.0696.

Staw, B. M. (1976). Knee-deep in the big muddy: A study of escalating commitment to a chosen course of action. Organizational Behavior and Human Performance, 16(1), 27–44. https://doi.org/10.1016/0030-5073(76)90005-2.

Sun Tzu. (1910). The art of war (L. Giles, Trans.). Project Gutenberg.