“Evidence-Based Management” by Pfeffer and Sutton

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Personal Commentary

The article “Evidence-Based Management” (Pfeffer and Sutton) discussed the management follies that are applied in business practices without having any empirically support or experience of using them earlier. Management executives are accused in the article of using a generalized decision for policymaking in different conditions.

Decisions that were applied in totally different business situations are used in places that require the same end, which is almost like a doctor prescribing the same medicine for curing a patient with a fever. But the doctor fails to understand the actual cause of the fever. This essay discusses the ailments of “clinical experience” that management decisions suffer and how these decisions cannot be stereotyped or generalized by comparing the management decisions to treatment procedures of medical practitioners.

Executives’ decisions to solve a certain problem in the organization are often smeared with influences that shape their decision. These solutions are influenced by various influences such as:

The best current experience that the practitioner had. For instance, the solution that succeeded in a software firm being applied to another firm that has totally different circumstances, situations and backgrounds. Such clinical decisions often lead to erroneous and unsuccessful results.
The practitioner’s experience capitalizes on his own strengths. This problem arises for specialists who use the treatments with which they are most experienced and comfortable.
Advertisements and hyped solutions through promotions are often a barrier to focused decision making.
Dogmas and beliefs also drive the decisions that are taken. When ideologies drive decision making, decision-takers often fail to realize if the solution will work. Such a thing is the adoption of employee stock options (ESOP) in the compensation strategies of organizations. Belief suggests that ESOP increases financial performance, which research has shown has no perceived relationship.
First-mover’s advantage always does not ensure success for the company. Research has shown a mixed outcome.
Benchmarking for management decision making done on an ad hoc basis.

An example of a forced raking method of evaluating employees is used to determine if the system so successfully used at General Electronics is applicable to our company. A case of a company is illustrated where this system of performance measurement is dubbed highly unpopular among employees but is still practised. Evidence-based decision making would negate this and still follow it. But what evidence-based decision making would advise is that there should a proper diagnosis of the organizational requirements and the available options that would best fit the organizational situations.

The authors suggest establishing evidence-based decision making in corporate decision-making processes. There are certain enablers of evidence-based decision making. “…evidence-based decision making in a culture that reinforces speaking the truth about how things are going is certainly another crucial component.” (Pfeffer and Sutton 70)

Further, just asking for backup research on proposals is not enough to foster a true organizational commitment to evidence-based management, especially given the problems that bedevil much so-called business research. Organizational culture influences the evidence-based decision, as different cultures will have different influencing power over the decision making construct. A decision-based process will remove the major problem if stack up rankling is influenced in which is basically due to external influences on the decisions taken.

One drawback of evidence-based decision making is that: “A big barrier to using experiments to build management knowledge is that companies tend to adopt practices in an all-or-nothing way such field trips and finding other ways to gather qualitative data, managers can convey that decisions” (Pfeffer and Sutton 73).

The article claims that evidence-based decisions taken are often more successful and provide greater success stories. But the article fails to realize that evidence-based researches can also be subject to the influencers of management decision makings. There are a number of peers reviewed studies that suggest that evidence-based decisions are best suited and tailored for organizational requirements, but the authors themselves question this contention.

For our understanding, it can be said that this mode of decision making, as described by the article, is important learning for management studies. It helps us understand that often management decisions are influenced by various factors other than empirical evidence. Often managements impose a decision or policy without properly understanding the background of the problem. Clearly, this mode of decision making will lead to a safer decision that is done democratically.

But this also requires top management and leadership commitment, primarily because, ‘Leaders who are committed to practising evidence-based management also need to brace themselves for a nasty side effect: When it is done right, it will undermine their power and prestige, which may prove unsettling to those who enjoy wielding influence.” (Pfeffer and Sutton 74)

But some interesting questions that arise out of the article are if clinical decisions completely useless? Where is the evidence that supports evidence for proving the success of evidence-based decisions? Further, one must understand that evidence-based decisions are not specific but rather depends on the perceptions and the judgment of the decision taker. This arise the final question: then how different the erstwhile and the evidence-based decision process.

Bibliography

Pfeffer, Jeffrey and Robert I. Sutton. “Evidence-Based Management.” Harvard Business Review (2006): 63-77.

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“Evidence-Based Management” by Pfeffer and Sutton

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