Management and the Illusion of Control

Sep 19, 2018

Back in the 70’s, Harvard psychologist Ellen Langer studied a phenomenon she called the Illusion of Control. That is the strong tendency people have to see their actions as causing things to happen, even when they have no impact whatsoever. She conducted a variety of studies to demonstrate this and many psychologists have repeated them over the years.

Controlled experiments are cool and all, but you and I don’t need to look farther than everyday life to know what she was talking about:

  • The sports fan who acts as though what jersey they wear, or what seat they occupy, has an impact on the outcome of a game they are watching on television.
  • The fact that I repeatedly press the button for the pedestrian walk signal when it still has to go through its cycle no matter how many times I hit it.
  • And all those thermostats in office buildings that have no effect on the actual temperature, but do reduce the chances that you’ll call the facilities office to complain.

Consistently, people want to avoid the discomfort that comes with acknowledging a lack of control and they want to feel like they are doing something. To make matters worse, we don’t just fall victim to the illusion of control in how we perceive things. We actually take steps to create that illusion for ourselves, because it makes us feel better.

Ok, you might say, you’re impatient, sports fans are superstitious, and HVAC engineers are having a good laugh at all of our expense. What does any of that have to do with management?

Well, if we’re honest about it, a lot of management activity in our companies is no better:

  • Revenues are behind budget, so the head of sales increases the frequency of pipeline updates to weekly, even though the sales cycle averages 12 months. Managers and reps spend less time with customers and more time massaging and presenting spreadsheets.
  • A new innovative project comes with a lot of uncertainty, but also the potential to capture a fast-moving market opportunity. Before work can begin, management requires detailed project plans, a fixed budget, and ROI forecasts with a one-year payback period. Either the team makes numbers up, backing into the budget and hurdle rate, or finance kills the project before it can get started.
  • A cross-functional team is spun up to reorganize some key processes around the customer. Lots of people are involved. There are standing meetings, consultant reports, and lengthy slide decks. After several months, minor tweaks are made, but nothing much really changes.

Some management activity is like a kind of corporate rain dance. An appointed shaman leads the community in a performance that provides an outlet for everyone’s anxiety. The mystical powers of finance, or project management, or collaboration are invoked. Every department prepares a sacrificial budget offering. If it goes on long enough, and then it does in fact rain, everyone declares the ritual a success. You could say there’s some value in making people feel better, but it sure sucks up a lot of time and effort.

Other management activity is simply the equivalent of watching the pot and hoping that will make it boil. To be clear, monitoring key metrics is useful when we use that data to help inform decisions. But excessive hand-wringing over the numbers doesn’t actually change them for the better. And, while a pot may only be indifferent to the level of scrutiny, there is a lot of research to show that people’s performance frequently drops when subjected to high levels of control. (See Manzoni and Barsoux among others) So now, we’re not just wasting time, we’re actually making things worse.

Langer’s original research focused on situations where people’s actions had little to no influence on outcomes. Other researchers (including Francesca Gino and Don Moore) have also explored situations where people’s actions had varied degrees of influence on outcomes. Interestingly, they found an illusion on the other end of the spectrum as well. People show a marked tendency to underestimate the impact their actions have in situations where they actually have a lot of control. These effects are exacerbated when the task is difficult, risky or uncertain.

We see this in our daily work with real managers as well:

  • The mid-level executive, convinced nothing will change until tensions in the organizational structure are resolved, who emerges from a workshop with a concrete plan to make progress starting from exactly where she sits.
  • The frontline manager who was ready to write an employee off as “un-coachable”, only to find that changes in his own approach succeed in turning the relationship around.
  • The CXO frustrated with a seemingly endless cycle of unproductive executive team meetings, in spite of the fact that nobody has more authority to change the dynamic than they do.

While these two ideas might seem contradictory at first, the truth is they reflect forces that are both operating at the same time. The result is a double whammy for leaders and their businesses. On the one hand, managers will gravitate to activities that give them a feeling of control, even when they don’t produce much value for the organization. On the other hand, they will avoid tackling difficult and uncertain tasks where they underestimate their true potential impact.

How much time is spent in your organization on managerial rituals that don’t really change anything?

Do your leaders take on the difficult and important tasks, or do they tell themselves it’s out of their control?

What would happen in your company, if people spent less time trapped in illusions of control and more time working to engage the things that really matter?