Decisions Based on Evidence

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Managers should use things that really work.

The basic idea of Evidence Based Management derives from the area of medicine. If you’re dealing with people’s lifes it can have fatal effects if your decisions are based on unsystematic experience. The management of modern organisations should also be based on scientific knowledge and empirical findings. Thus possible outcomes of decisions are much more predictable.

A practical Example of Evidence Based Management

The division manager of a global marketing research firm notices a massive team conflict in one of his operating units. He’s just read an article in a management magazine about the experiences of a global player with survival training. Strong community, high spirits, better performance. Sounds like a simple plan. Then he recalls a principle from a long-ago course in psychology: Performance enhances cohesiveness rather than the other way round. He’s looking at the recent sales figures of the team – it’s pretty clear to him, that team-building activities won’t solve the problem. With input from team members, a redesigned feedback system takes shape. The new system uses three performance categories—customer orientation, data quality and knowledge transfer— and provides specific indicators for each category and an overall summary measure. After a year of continuous feedback the team’s performance increased about 90%. Using a team climate inventory he also found that the conflict within the team reduced significantly. In this example a principle (performance drives cohesiveness) is translated into practice (measure performance, provide feedback, enhance performance, reduce conflict).

"An example of practice-oriented evidence in I-O psychology are the reports by Robert Pritchard and his team, developing and investigating the use of the PROMES system for job analysis and strategic planning" (Rousseau, in press). ProMES is based on motivational theories like Goal Setting, Feedback Intervention Theory, and Participation in Decision Making.

If you want to learn more about the Motivation Theory Behind ProMES click here.

Meta-Analytic Evidence

ProMES has been implemented successfully in various countries, settings and branches. The studies were conducted by independent research groups both from academia and the applied world. Well-known companies and organizations like 3M, GfK, Leica Microsystems, the US Air Force, and SwissLife participated in one of the largest research studies in management history.

The study (see Pritchard and colleagues, 2008) shows that ProMES leads to strong and stable improvements in team productivity and organisational effectiveness. The teams from the study showed large productivity improvements averaging a productivity improvement of over 200%!

The effectiveness of ProMES is shown in the graph below. It shows the average improvement curve of 83 studies conducted between 1987 and 2007.

The productivity during baseline (productivity data measured but not communicated to the teams) averaged at around 50 effectiveness points (EP). After feedback productivity increased heavily to a point of diminishing returns. In contrast to other methods, productivity change is stable in the long run. Moreover, the researchers found in various studies, that ProMES improves job satisfaction, leads to lower perception of stress and fatigue and creates a positive working climate. Explanations for these effects are role and goal clarity, clear priorities and thus less conflict.

Literature Tipps on Evidence Based Management

Briner, R. B., & Rousseau, D. M. (in press). Evidence-Based I-O Psychology: Not there yet, Industrial and Organisational Psychology: Perspectives on Science and Practice.

Pritchard, R. D., Weaver, S. J. & Ashwood, E. L. (2012). Evidence-based productivity improvement: A practical guide to the Productivity Measurement and Enhancement System. New York: Routledge, Taylor & Francis Group.

Rousseau, D. M. (2006). Is there such a thing as "evidence based management"? Academy of Management Review, 31(2), 256–269.