How perceptions trump evidence

by | Jul 24, 2013

A recent Oxford University study found in blind taste tests that wine judges could not pick the difference between $30 and $630 bottles of champagne. It suggests that the perception of value (brand) trumps the evidence (taste). Yet so often in managing programs and organisations, managers operate on the basis that compelling evidence is the same as stakeholder perceptions. They believe that funding will continue and performance recognised. Not necessarily so.

Politicians deeply understand that voter perceptions are their reality, as do commercial marketers understand that consumer perceptions are their reality. They strive for their communications and messages to be grounded in how their audiences view the world.

Similarly, savvy managers understand that the same is true with stakeholder perceptions of environmental and industry development programs. Like politicians and commercial marketers, they also know that not all stakeholders are created equally. Some are much more influential than others (such as the investors and those who influence investors).

The key insight is that critical decisions can be shaped by the perceptions of particular groups (internal or external), rather than by the evidence. In our experience, common areas of disconnection are:

  • Devalued from great to good. Great performance in the eyes of most could be overshadowed by the criticisms and views of a few vested or competing interests. For example, high speed broadband and social media tools allow interest groups to create the perception with governments that their concerns are reflective of mainstream community views. These views can prevail with policy, regulatory and funding decisions, even when the evidence is to the contrary.
  • Overvalued. Poor performance could be obscured by a wealth of worthwhile activities and a dearth of valuable outcomes. Here, internal perceptions are prevailing. For example, industry and government programs are under unprecedented levels of scrutiny in the modern, connected economy. Stakeholders are well-informed and can reveal a lack of evidence of performance.
  • Undervalued. Great outcomes that are not fully promoted and shared. Here, if managers don’t blow their program’s trumpet there is no music. The quiet revolution now happening with NRM bodies is a good example.

No organisation or program is immune to disruptive or incremental change. Disruptive change is part of the landscape and hard to predict or influence. For example, the decision this month by the Australian government to move to an emissions trading scheme 12 months early resulted in large cuts to the Biodiversity Fund and Carbon Farming Futures program.

Our experience with environmental programs is that shifts in government policy directions and priorities, the outcomes of reviews, interest group activities and the wax and wane of public support for programs all contribute to short and long term impacts for managers. They variously translate to the wind-up, downsizing, re-direction, amalgamation or creation of programs. How decisions are taken always involve some combination of evidence and internal/external stakeholder perception.

The key message is that how your program or organisation is perceived internally and externally will shape future directions and funding decisions, even where those perceptions are at odds with the evidence. Do you know if your organisation or program is being devalued, overvalued, or undervalued by your most influential stakeholders?

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