May 27 2005

Follow up to “Thinking in groups”

Writing this reminds me that there really should be a function in TypePad that allows you to simply elevate a comment to a post  . . . Abhi responded to my post on Thinking in groups with the following comment, which was right on target: tohers), and thus assume that that the correct behavior was inaction). Let me expand on this in the context of venture capital, since I didn’t get into it in my original post.  I think the pressur  around conformity is significantly exacerbated for a non-partner VC .  In a body of equals there’s clearly some pressur  to go with the flow.  Where the group is not all on equal standing this pressure is intensified. Clearly a key to being an effective VC is not falling into this trap.  This can be particularly hard for a junior VC and especially if s/he is  the observer rather than the board member (see my post on the difference here).  I’ve watched this dynamic play out in front of me – where dissenting opinion, particularly of the partner, is absolutely not allowed.  I think this is stupid way for partners to run their business – after all they pay th  people around them to have opinions (thankfully Brad heartily agrees and encourages full participation from everyone around the table), but it happens all the time.  How easy for groups (i.e., boards) to sometimes lean towards a similar interpretations of events” Borrowing liberally from Cialdini’s ‘Influence’ book – Social Proof – In any situation we are apt to behave exactly the same as other people behave (so board members will often look at other board members to decide how to react), and this is even stronger when the other people are similar to us (i’m assuming most board members are quite similar to each other). Ex: If there’s a red light but no traffic then one person crossing will usually lead to everyone else crossing. Ex: Comedy shows have canned laughter because that automatically means people laugh ‘along with’ the fake laughter. Ex: The chance of a wounded person getting help is higher if a single person were to see him than if a bunch of people saw him (as in the latter case these people would ALL see each other for reactions, see no response (as they’re all looking to