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Making decisions
Making decisions

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5.6 A way of dealing with social pressures: decoupling

Organisations often deal with these social pressures by decoupling responses to these different pressures. The need to appear legitimate in the eyes of important constituencies is met by actions and practices which have a purely ceremonial character: they are done for the sake of appearances and not with any real engagement. The example in Box 5 shows how the Taiwanese subsidiary of a Western multinational uses decoupling to resolve the tension between parent-company coercive pressures to adopt a particular approach to performance management, and the mimetic and normative pressures resulting from the cultural setting in which the subsidiary operates.

Box 5: Decoupling appraisal practices in a multinational firm

While running an executive education programme for a large multinational, I touched on approaches to appraisal and performance management. I knew the firm had just rolled out a performance management system worldwide. The system embodied a USA-style, individually focused approach, with rewards and career advancement tied to outcomes of annual appraisals which were conducted according to a predefined template of competencies and performance criteria. I also knew that such systems had a poor record in cultures with a strong Chinese influence, where there is considerable emphasis on the role of relational ties and strength of personal networks in determining career advancement.

I asked how this new system had been received in Taiwan. At first, in class, the answer was that it was working fine. However, after lunch two Taiwanese managers approached me and asked if I would like to know the real story. ‘In truth,’ they said, ‘each year we meet, as we always have, to decide on who we want to promote and give bonuses to. Then a couple of us go into another room and write the appraisals to ensure we get those outcomes.’

So in this section we have seen that our decision-making behaviour is affected by more than just our own individual psychological make-up. Our decisions are significantly affected by the social milieu in which we live and work. We are all driven to varying extents by the need for social legitimacy and the demands of groups of which we are members. Paying attention to these social contexts and pressures can enrich our understanding of how decisions are really taken and alert us to some of the invisible strings which tug at us.