According to a recent study, the atmosphere within a group can play a significant role in the effectiveness of strategic decision-making. The researchers discovered that varying atmospheres influenced how individuals communicated and interacted, which in turn affected their understanding of strategies.
Recent research indicates that the group atmosphere significantly impacts the outcomes of strategic decision-making, as highlighted by a study co-authored by Bayes Business School (previously known as Cass).
Paula Jarzabkowski, a Professor of Strategic Management at Bayes, collaborated with colleagues from the University of Queensland, Macquarie University, and Leuphana University of Lüneburg. They found that different atmospheres prompted varied communication styles and interaction patterns, altering participants’ perceptions of strategy.
For example, a reflective atmosphere made individuals cautious about their next steps, while a curious one encouraged an exploratory approach to strategizing. Conversely, a tense or dismissive atmosphere led to arguments, making it difficult for participants to find common ground on future actions.
The team analyzed video recordings, conducted workshops, held interviews, and made direct observations over 18 months of a strategic project team comprised of managers and consultants at an electronic bank in Australia. They focused on how the banking team interacted while evaluating a digital product designed with AI technologies to assist customers in managing their spending.
The researchers also noted that atmospheres could change swiftly; even slight alterations in tone, speech, or body language could significantly influence group reactions to various ideas. The overall findings indicated that in group environments, individuals’ perception of the atmosphere affects their collaborative understanding when addressing decisions.
Professor Jarzabkowski remarked:
“We aimed to investigate how subconscious cues, such as tone of voice, mindset, emotional exchanges, and body language, might impact others’ perspectives during the decision-making process.”
“Our findings reveal that strategic decision-making extends beyond just making the best choices. The emotional climate in the room plays a crucial role in shaping the strategies that organizations adopt.”
Professors Eric Knight and Jaco Lok from Macquarie Business School added:
“While it’s common knowledge that atmosphere affects feelings, its influence on understanding complex topics has not been thoroughly explored. This makes our study particularly important and unique.”
Matthias Wenzel, Professor of Organization Studies at Leuphana University of Lüneburg, stated:
“We often believe that there is consensus or a shared understanding in managerial decisions. Our research illustrates that what is truly shared is the atmosphere in the room, and this impacts the decisions that are made.”
