Collective stupidity: influences on decision-making in knowledge-based companies

Abstract

PurposeEven the smartest organizations believe that “good enough is never good enough.” Highly intelligent people may be able to do important things individually; still, it is their accumulated brainpower that allows them to do great things. Collective intelligence means when a group of people do things that seem intelligent. On the other hand, when intelligent people are gathered or hired in an organization, they tend toward collective stupidity and slow-wittedness. Therefore, the purpose of the present study is to develop a model of the factors affecting and affected by collective stupidity.Design/methodology/approachThis study was conducted using a mixed-method approach and in two phases: qualitative and quantitative. First, in the qualitative phase and in order to achieve new findings, semi-structured interviews with experts from 12 knowledge-based companies were used to design a conceptual model and formulate the hypotheses. At the end of the qualitative phase, the conceptual model and relationships between variables were drawn. Then, in the quantitative phase, by running structural equation modeling, the antecedents and consequences of collective stupidity derived from the qualitative phase findings were analyzed and the research hypotheses were tested in 110 industrial knowledge-based companies.FindingsThe results of the qualitative phase revealed that individual, group and organizational factors were the antecedents of collective stupidity, with individual factors having three dimensions, collective ones including two dimensions and organizational ones focusing on the characteristics of managers/companies. It was also found that collective stupidity had individual consequences in three dimensions and organizational consequences in five dimensions; and one-sidedness, non-strategic thinking, organizational injustice and weakness in the management of key personnel were extracted as mediators. The results of the quantitative phase confirmed the research model and showed that individual factors and organizational consequences had the lowest (0.037) and highest (1.084) effect sizes on collective stupidity, respectively.Research limitations/implicationsThe study of the phenomenon in a particular context and the difficulty of generalizing the findings to other situations, the small size of the study population due to the disproportionate number of experts to the total staff in the qualitative phase, and the limited participation of experts due to the negative nature of the issue in the quantitative phase. Taking advantage of the diversity of experts' mental abilities through equipping the organization with tools for recognizing collective stupidity, improving collective decision-making, enhancing the efficiency of think tanks and organizational prosperity in the age of knowledge economy, preventing damage to the body of knowledge of the company and reducing social loafing can be the main operational implications of this study.Originality/valueUsing a mixed-method approach for analyzing the antecedents and consequences of collective stupidity in this study and examining such a phenomenon in a knowledge-based organizational context and its implementation in a developing country can be among the innovations of the present research. By following a few studies conducted in this field in addition to the organizational pathology of the phenomenon using a fundamental method, this study obtained deep results on how to make the maximum use of experts’ capacities. This was to the extent that in all of the three sections, i.e. the antecedents and consequences of collective stupidity, a new factor emerged.

The crowd dynamics and collective stupidity of the January 6 riot: Theoretical analyses and prescriptions for a collectively wiser future.

“…Some researchers have examined this tendency under the rubric of “collective stupidity” (cf. Ahmadzadeh et al, 2022; Albrecht, 2003; Lehrer, 2011). We think this is an apt term for the factors that facilitated the January 6 riot and other suboptimal collective actions in our society (hence our title).…”

“…1The use of “collective stupidity” in the title may seem a bit harsh in an academic paper. There is precedence for this term in the literature (e.g., Ahmadzadeh et al, 2022). It reflects our conviction that nonoptimal collective functioning, when participants should or do know better, can be very harmful at the local and societal levels.…”

Business model innovation decisions: the role of group biases and risk willingness

“…More specifically, we examine how group biases and board members' risk willingness affect this process. Although managers strive to use their collective intelligence in their decision-making process (Ahmadzadeh et al, 2022), their "bounded rationality" influences their strategic decisions (Cyert and March, 1963;Simon, 1993). Based on their prior knowledge and experience (Dane and Pratt, 2007), executives intuitively use cognitive heuristics (Norris et al, 2020) and encounter cognitive limitations at the individual and group level (Cristofaro, 2016;Schneckenberg et al, 2017).…”

“…More specifically, we examine how group biases and board members’ risk willingness affect this process. Although managers strive to use their collective intelligence in their decision-making process (Ahmadzadeh et al. , 2022), their “bounded rationality” influences their strategic decisions (Cyert and March, 1963; Simon, 1993).…”

Need for Power, Personality Traits, and Organizational Work-Related Behaviors among Employees

“…Power is the ability to persuade another employee to behave or perform in a specific manner, whereas influence is the use of deliberate actions to change the targeted behaviors/thoughts of the employees (Manning et al, 2008). For example, the organization's strategic decision-making is influenced by employees who frequently exert interpersonal influence over other employees to achieve their personal needs and interests (Ahmadzadeh et al, 2022;Watts et al, 2018). Therefore, the term "Need for Power" refers to the desire to influence other employees as well as have power over other employees in the organization (Moon et al, 2022;McClelland, 1987).…”