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The Decision-Making Flaw in Powerful People

The paper below finds a link between having a sense of power and ignoring advice. The authors argue that power increases confidence, which can lead to an excessive belief in one’s own judgment.

In a sense, powerful people think they are right because of their place in the organization, not because of their knowledge. This, of course, leads to flawed decisions.

From Strategy+Business:

Previous research has shown that the quality of decision making declines when people hew too much to their own beliefs and discount too readily the advice of others; outside information helps “average out” the distortions that can result when people give a great deal of weight to their own opinions and first impressions. This paper is among the first to examine whether power — defined as an individual’s “capacity to influence others, stemming in part from his or her control over resources, rewards, or punishments” — reduces or increases a person’s willingness to heed advice.

In addition to confirming the previous experiments’ finding that more powerful people were less likely to take advice and were more likely to have high confidence in their answers, this final experiment showed that high-power participants were less accurate in their answers than low-power participants. By calculating the mean deviation between respondents’ initial estimates and the true answers, the researchers showed that low-power participants came significantly closer in their final estimates to the real tuition numbers because they “averaged” their initial guesses with the input from the advisors.

The researchers propose that their findings have troubling implications for organizations — and that power could negatively affect not just advice taking, but also an individual’s approach to seeking help or accepting performance feedback. But because power and confidence are so interrelated, there are ways to mitigate the problem. By “directly addressing the inflated confidence levels of powerful individuals,” the researchers write, “organizations may be able to help people with power take (and/or seek) advice when it is valuable to do so.”

For one thing, organizations could formally include advice gathering at the earliest stages of the decision-making process, before powerful individuals have a chance to form their own opinions. Encouraging leaders to refrain from commenting on decisions publicly could also keep them from feeling wedded to a particular point of view.

Bottom Line:
Powerful people are less likely to take advice from others, in large part because they have high confidence in their own judgment and don’t feel the need to incorporate outside views. By not factoring in others’ advice, however, people in power risk making flawed decisions.

Abstract:

Incorporating input from others can enhance decision quality, yet often people do not effectively utilize advice. We propose that greater power increases the propensity to discount advice, and that a key mechanism explaining this effect is elevated confidence in one’s judgment. We investigate the relationships across four studies: a field survey where working professionals rated their own power and confidence and were rated by coworkers on their level of advice taking; an advice taking task where power and confidence were self-reported; and two advice taking experiments where power was manipulated. Results consistently showed a negative relationship between power and advice taking, and evidence of mediation through confidence. The fourth study also revealed that higher power participants were less accurate in their final judgments. Power can thus exacerbate the tendency for people to overweight their own initial judgment, such that the most powerful decision makers can also be the least accurate.

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Source: Kelly E. See, Elizabeth W. Morrison, Naomi B. Rothman, Jack B. Soll, The detrimental effects of power on confidence, advice taking, and accuracy, Organizational Behavior and Human Decision Processes