Building consensus in strategic decision making: System dynamics as a group support system

System dynamics was originally founded as a method for modeling and simulating the behavior of industrial systems. In recent years it is increasingly employed as a Group Support System for strategic decision-making groups. The model is constructed in direct interaction with a management team, and the procedure is generally referred to as group model-building. The model can be conceptual (qualitative) or a full-blown (quantitative) computer simulation model. In this article, a case is described in which a qualitative system dynamics model was built to support strategic decision making in a Dutch government agency.Since people from different departments held strongly opposite viewpoints on the strategy, the agency had discussed its strategic problem for more than a year, but was obviously not able to reach consensus. The application of group model-building was successful in integrating opposite points of view, as well as in fostering consensus and creating commitment.The purpose of the article is twofold: first, to illustrate the process of group model-building with system dynamics; second, to evaluate why it was successful. Evaluation results reveal the importance of both systemic thinking through model-building and the role of the facilitator in catalyzing the strategic decision-making process.     

Cognitive Mapping: A Process to Support Strategic Planning in an Academic Department

Cognitive mapping has been used to support strategic planning in business. However, the process has seldom been utilized to support strategic planning in nonprofit public organizations, where many reporting lines are less clear. This paper describes how the cognitive mapping process was designed and implemented to help a large academic department identify and merge the individual goals of faculty members as a first step in creating a strategic plan. Each map was created using the Decision Explorer^TM software during individual interviews, as opposed to using paper and pencil. An action case approach was used to plan and evaluate individual mapping sessions. Eliciting individual cognitive maps led to greater engagement by faculty in the strategic planning process. Nearly all of the participating faculty members believed that the cognitive mapping process was helpful and insightful and the resulting map was accurate and complete.     

Performance implications of cognitive complexity: An empirical study of cognitive strategic groups in semiconductor industry

This study extends previous strategic group research by empirically examining the performance effects of group's cognitive complexity in Taiwan semiconductor industry. Through computer-aided content analysis, this study derives themes from letters to shareholders as variables to assess the managerial cognitive complexity and uses thematic variations to find cognitive strategic groups during periods of market downturns, uncertainty and upturns. The study specifies three statistically reliable and accurate themes (operation, customer, and product) and identifies five types of cognitive strategic groups with different degrees of cognitive complexity on perceived strategic dimensions. The results indicate that cognitively complex groups with dual orientations toward customers and products sustain competitive advantages over time, especially during periods of market downturns and uncertainty.     

De-Fusing Organizational Power Using Anonymity and Cognitive Factions in a Participative Strategic Planning Setting

When an organization is facing disruptive change or the need for new capabilities to fit new conditions, the creation of a democratic strategic plan can be useful. However, strategic plans typically only reflect the beliefs and values of their architects; not all stakeholders. To include the beliefs of all stakeholders requires a participative environment. Due to the potential deleterious effects that organizational power may have in a participative setting, anonymity and cognitive factions is proposed to reduce the possible negative effects associated with power in a participative strategic planning setting. Group support systems have been shown to protect relationships and retain the social order in these settings. In this specific case, through the use of a group support system that supports anonymity and cognitive faction identification, we found that the sources of power typically found and used to drive group decisions in an academic setting did not drive the content of the strategic plan.     

An Assessment Framework for Practicing Facilitator

There is an on-going recognition of the need for facilitation to support different group settings. However, the skills and expertise required to successfully facilitate a group of participants to achieve their goal is a challenging task to achieve. There are a number of barriers towards facilitation: A facilitator needs to operate at many different levels at the same time; understand the politics within the group; encourage interaction within the group; and guide participants through tasks and activities, while balancing the needs of the group and the client to reach real outcomes. One of the key competences of a facilitator is flexibility, to adapt to varying circumstances. The complexity and dynamic nature of delivering an appropriate and effective facilitation service makes it therefore difficult to assess the facilitator’s performance in any facilitated session. In this paper we describe a framework in the form of an artefact developed to aid the facilitators in assessing their own performance in different meetings. Facilitation Service Assessment Framework (FSAF) allows facilitators to define metrics and measures in the context of facilitator’s goals. The assessment framework consists of a structure and a process which facilitators use to apply the framework to facilitation scenarios. Finally, the paper describes how experts evaluated FSAF in alternative scenarios by running a survey and then by conducting interviews.     

Influence of Computer-Based Meeting Support on Process and Outcomes for a Divisional Coordinating Group

This research examines the introduction of computer-based group decision support systems (GDSS) to members of a division level coordinating group. Participants performed authentic problem formulation tasks which varied naturally in degree of structuredness, in two non-GDSS meetings then were provided GDSS for four additional meetings. It was proposed that the introduction of the GDSS and task structuredness would influence (1) group process in terms of the amount of divergent and convergent thinking communicated during meetings and (2) perceived outcomes regarding quality, satisfaction, understanding, confidence, and commitment to group positions. Results suggest that GDSS use affected both the total amount and pattern of group communication but not perceived outcomes. Structuredness of the task affected perceived outcomes but neither amount nor patterns of communication. Additional qualitative data regarding perceived of costs and benefits in using GDSS provide richer explanation for study findings and suggest further lines of inquiry.     

Modifiers for Quality Assurance in Group Facilitation

A key task of a professional facilitator is to assure the quality of the knowledge products created through collaborative effort. To manage the quality of the knowledge a group generates, facilitators attend to, judge, and question the quality of the contributions a group makes, the decisions it makes and the commitments its members make toward achieving the group’s goals. When facilitators or group members detect deficiencies in ideas, decisions, agreements, or artifacts, facilitators may need to intervene to support the group in improving the quality of their output, without disrupting the flow of the group process. In this paper we present a framework for quality assessment and a toolbox with flexible interventions that can be added to a collaborative process on the fly as soon as quality deficiencies are detected. The toolbox is a set of conditional adjustment interventions that a facilitator can add to other facilitation techniques so as to guard the quality of the group’s intellectual products. The toolbox can also be used as a starting point for designing intelligent agents that support the automatic detection of quality deficiencies.     

An outsourcing framework: action research in the heavy industry sector

Recent literature suggests that outsourcing, properly understood and managed as an integral part of strategy, can aid competitiveness. This paper examines the process of outsourcing manufacturing to understand its role in the new strategic agenda. A system model which indicates the critical workflow interfaces between the production system and internal support functions is proposed. The model helps determine the cross-functional interdependencies of the outsourcing process. A four-phase model of strategic outsourcing is then developed. The model serves both as an internal management tool and as an external marketing tool. This leads to synthesis of a practical framework that links six generic phases of outsourcing to strategic planning. The framework includes key activities with built-in performance measures and expected output for each of the phases. The research methodology combines theory study with case study and action research in Aalborg Industries, which operates in the heavy industry. Hence, the research pursues both academic and industrial application.     

The Design of a GDSS Meeting Preparation Tool

The facilitator is a critical resource in computer supported decision-making groups. Facilitation is a complex task, encompassing social and technical abilities, analysis and synthesis skills, and making use of planning and flexibility, which opens multiple opportunities for computational support. This paper addresses specifically the current limitations of pre-meeting support. Having the objective of increasing support to the facilitation activities that deal with the process facet, we developed a meeting preparation tool around a comprehensive model of the decision process. An experiment revealed that the tool produces considerably different meeting agendas, especially in what concerns size and diversity. An attempt to evaluate the quality of the meeting agendas indicates an increase in the clarity criterion.     

Contrasting Single User and Networked Group Decision Support Systems for Strategy Making

The use of computers to support group work – as a Group Decision Support System (GDSS) – on strategy making has grown over the last decade. Some GDSS's have a facilitator managing the computer with the group viewing a public screen displaying the debate, problem definition, and agreements of the group as it negotiates strategies. Others involve members of the group in the direct input of data that forms part of the problem definition – data that is then used by the group employing electronic voting and other organizing devices. This paper discusses a real case relating to an organization seeking to reach important agreements about its strategy. The case involved the top management team and over 50 senior managers. The organization used a facilitator driven GDSS for some of this work, and a networked system for other parts. Some of the meetings were video taped, some were observed through one-way mirrors, and all of the participants were interviewed about their reactions to the different systems. This paper reports on some of the significant contrasts between the two approaches.     

Group Decision Support Using Fuzzy Cognitive Maps for Causal Reasoning

Cognitive maps have been used for analysing and aiding decision-making by investigating causal links among relevant domain concepts. A fuzzy cognitive map (FCM) is an extension of a cognitive map with the additional capability of representing feedback through weighted causal links. FCMs can be used as tools for both static as well as dynamic analysis of scenarios evolving with time. An FCM represents an expert's domain knowledge in a form that lends itself to relatively easy integration into a collective knowledge base for a group involved in a decision process. The resulting group FCM has the potential to serve as a useful tool in a group decision support environment. An appropriate methodology for the development and analysis of group FCMs is required. A framework for such a methodology consisting of the development and application phases is presented.     

The Yonmenkaigi System Method: An Implementation-Oriented Group Decision Support Approach

The Yonmenkaigi System Method (YSM) is presented as a participatory method to support group decision making. It is composed of four main steps: conducting a SWOT analysis, completing the Yonmenkaigi chart, debating, and presenting the group’s action plan. The YSM is an implementation and collaboration-oriented approach that incorporates the synergistic process of mutual learning, decision making and capacity building. It fosters small and modest breakthrough and/or innovative strategy development. The YSM addresses the issues of resource management and mobilization as well as effective involvement and commitment by participants and provides a strategic communication platform for participants. A case study for developing a disaster reduction action plan, carried out with a local community organization in the City of Kyoto, Japan, is used to demonstrate the characteristics of the YSM.     

When do AI chatbots lead to higher customer satisfaction than human frontline employees in online shopping assistance? Considering product attribute type

The increasing adoption of AI chatbots in online shopping assistance, as a complement or substitute for human frontline employees (HFLEs), leads to the question whether HFLEs perform better than AI service robots and why. From the perspective of product attribute type (experiential/functional) and focusing on customer satisfaction, this study explores how the impact of service agent on customer satisfaction varies along with product attribute type. A scenario-based experiment was designed and completed by 567 participants. Although HFLEs lead to higher customer satisfaction when the product attribute is experiential, AI chatbots perform better than HFLEs when the product attribute is functional. We make use of perceived information quality, perceived waiting time, and positive emotions, three determinants of customer satisfaction, to explain the variation of the role of different service agent types. The findings offer useful implications for companies when selecting service agent types in online shopping assistance.     

Cognitive Maps and a Hyperknowledge Support System in Strategic Management

Strategic management is defined as the system of action programs which form sustainable competitive advantages for a corporation, its divisions, and its business units in a strategic planning period.We have developed a system called Woodstrat to serve as a support system for these action program activities on both the corporate, the divisional, and the business unit levels. The system is modular and is built around the logic of strategic management, i.e., the main modules cover the market position; the competitive position; the production position; and the profitability, investment, and financing positions. The innovation in Woodstrat is that these modules are linked together, i.e., when a strong market position is built into some market segment, it will have an immediate impact on profitability through links running from the assumptions on an expected development to the projected profit/loss statement. There are similar links making the competitive position interact with the market position, and the production position interact with both the market and the competitive positions, and with the profitability and financing positions.The intermodular links are based on expert knowledge of strategic management; expert knowledge is also worked into the modules such that the logic of strategic management guides the user through the process of working out sustainable competitive advantages. The process is made user-supportive with a hyperknowledge user interface. The support is made intuitive and effective with the use of object-oriented expert system technology. The basis for this is rather unusual: the Woodstrat system was built with Visual Basic, in which the objects to create a hyperknowledge environment were built.It is shown that the conceptual constructs which form strategic management can be described with cognitive maps, and that these can be adequately represented with our hyperknowledge objects. It is also shown that the knowledge formation which takes place in a management team when strategic plans are formed can be described and validated with a hyperknowledge support system. It is finally shown that a support system with hyperknowledge features, which are close to the cognitive maps of a management team, will have a profound impact on the depth and the structure of its strategic management processes.     

Competitive intelligence and strategic group decisions: A new diagnostic tool

The use of competitive intelligence (information on competitors, technology, market developments, etc.) in strategic group decision making is of great interest to practitioners and strategy researchers alike, yet relatively little is known about the availability of competitive intelligence and the actual need for intelligence by decision makers. This article develops a decision-dependent input/participants matrix which is the basis for the derivation of seven intelligence availability and demand indices. The indices are diagnostic tools to help companies design and monitor strategic competitive intelligence gathering and distribution. They constitute part of an organizational intelligence support system designed to strengthen group decisions such as launching a new product. Practitioners can use the indices to diagnose problems countered by groups of decision makers in the intelligence gathering and distribution activities of organizations, and researchers can use them in the systematic study of this new field. An application of the tool to a pharmaceutical company is described.     

Training strategic thinking: Experimental evidence

Strategic behavior is crucial for strong firm performance, especially in competitive environments. Thus, designing a good strategy is a key issue for firms. Designing a strategy requires a combination of strategic thinking—which involves analyzing a firm's strategic environment, defining a vision of its future, and devising new ideas to out-think competitors – and strategic planning – which implies using these ideas to formulate a business plan. Although many firms excel at strategic planning, few devote enough resources to strategic thinking, which results in strategic insanity (i.e., firms repeatedly applying the same strategies with the expectation of different outcomes). To foster a strategic environment within a firm, firm managers and other workers must show willingness for active involvement in a firm's strategic decisions. Nevertheless, not everybody has the skills to do so, as many firms lack work force training programs. This study shows, experimentally, how training affects firms' strategic behavior. The starting point is two groups of individuals with initially equal qualifications who play in a sequential game whose rules hinder the calculation of equilibria. The members of only one of the groups previously receive a treatment entailing a process of training and learning that aims at fostering strategic thinking. The results point to a significant increase in the number of strategic decisions in the treatment group in sharp contrast to the control group, confirming the initial hypothesis (i.e., the positive impact of training).     

Evaluating Facilitated Modelling Processes and Outcomes: An Experiment Comparing a Single and a Multimethod Approach in Group Model Building

Facilitated modelling approaches have been suggested as helpful tools to support negotiation in strategic analysis processes due to their potential to facilitate cognitive change and enhance consensus and commitment with final decisions. In the present research, we developed an experimental framework to compare what two of these approaches, that is, group model building and a multimethod approach, contribute to the process and outcomes in the negotiation of strategies. In the multimethod approach, we combined strategic options development and analysis with computer simulations of the group model building approach. We explored the differences between these two modelling approaches in facilitating cognitive change, consensus and commitment by building an experimental research design with real clients, working on their organisation’s problem. Furthermore, we compared the type and content of participants’ contributions in the strategic conversation. The lessons from the experiment conducted are twofold. On one hand, the multimethod approach encouraged more divergent contributions and produced a higher degree of cognitive change than group model building (i.e., the single approach). On the other hand, group model building encouraged more contributions about content related to causes of the problem and enhanced more commitment to the final solution than the multimethod approach. Hence, the conducted experiment brings new insights into the benefits of using multimethods and possible losses resulting from such combinations. Accordingly, we have presented opportunities for further research regarding the combination of facilitated modelling approaches.     

Electronic Meetings and Intense Group Conflict: Effects of a Policy-Modeling Performance Support System and an Audio Communication Support System on Satisfaction and Agreement

Ad-hoc decision teams were used to examine the effects of an electronic meeting system (EMS) on group satisfaction and agreement. The decision task provoked intense conflict of values. The EMS had two core features - a policy-modeling group performance support system (incorporating structured decision methods and computer-supported cognitive feedback using Multi-Attribute Utility Analysis and Social Judgment Analysis), and an audio-based group communication support system (allowed dispersed members to communicate by voice). Policy groups reached higher agreement than conventional decision-making groups, apparently due primarily to the structure for cognitive-conflict tasks that was imposed on group discussion rather than computer-supported cognitive feedback displays. Audio groups were more satisfied with the conflict process than face-to-face groups. Decision agreement was equivalent across the two media. These audio effects for a highly equivocal task represent a further challenge to media richness theory.     

A‐pool: An agent‐oriented open system shell for distributed decision process modeling

An agent‐oriented open system shell, A‐Pool, for distributed decision process modeling in the Internet domain is presented. Unlike most decision support systems, A‐Pool provides a testbed for modeling and understanding the cognitive aspects of distributed decision processes themselves rather than for domain‐specific problem solving. This is achieved with a pool of virtual agents and a pool of cognitive maps of the agents at each A‐Pool node. The virtual agent scheme extends object‐oriented programming to the Internet domain and supports different communication and collaboration protocols with virtual communities, virtual sessions, and virtual conferences. The cognitive map scheme supports perspective sharing and various conflict integration and resolution strategies through cognitive map composition, derivation, and focus generation. Thus each A‐Pool node provides an architecture for modeling interdependencies and for ensuring global coherence; in addition, the communication is asynchronous and the control is distributed, allowing a large degree of autonomy and the examination of various thoughts and social protocols involved in strategic planning in an open system environment. Basic ideas are illustrated with a running example.