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.