The role of sensemaking in the decision-making process

In the face of any event, risk or threat, humans undergo a “sensemaking” process – where we process information to assign meaning, which informs the action we will take to address the threat. When examining how individuals and companies are responding to climate change and other environmental stresses, understanding how people process and make sense of the information they receive helps explain why some people are alarmed and compelled to take action and others are not.

We all see the world through our own eyes, filtered through our unique attitudes, beliefs and past experiences. As a result, different people can look at the same incident and draw vastly differently conclusions about its meaning and importance.

In the face of any event, risk or threat, humans undergo a “sensemaking” process – where we process information to assign meaning, which informs the action we will take to address the threat. When examining how individuals and companies are responding to climate change and other environmental stresses, understanding how people process and make sense of the information they receive helps explain why some people are alarmed and compelled to take action and others are not. A disaster such as a flood is easily recognizable as an event that requires immediate action. However, long-term, systematic changes provoke differing responses.

Individual sensemaking of a threat is informed by previous experience, interaction with others, and one’s identity, among other factors. Certain human traits may make us less likely to recognize and act on a long-term threat such as climate change. Over our long history on earth, humans had to develop an innate optimism and confidence in order to survive in a harsh environment. However, now those same traits cause some of us to believe that technological innovation offers the answer to the challenges we face, negating the need to make any major lifestyle or systematic changes. Humans are also motivated by instant gratification, which could be as a result of the worry about daily survival that we experienced throughout most of our existence. Evolution has not kept pace with the changes in our external environment, such that we are perhaps not naturally equipped to deal with longer term, more systematic threats.

Within a company or government, individual sensemaking is translated to the organizational level. There are various theories to explain how this occurs. Someone in a leadership position must perceive a threat, and recognize the need for sensemaking, and for action. There are many examples of this type of individual leadership in the corporate or political world, such as Ray Anderson at Interface. Leaders may chose to engage others at all levels of the organization, or only those in their inner circle. In addition, organizational ideology has a strong influence on sensemaking, since it informs “beliefs about cause–effect relationships, preferences for certain outcomes, and expectations of appropriate behaviours.” The sensemaking process therefore differs significantly by organization (as it does in individuals), leading to diverse results regarding environmental trends. These responses include recognition of a problem and opportunity, that can manifest in a new corporate direction (e.g. Interface) or new strategies and lines of business (e.g. Ecomagination at GE). If the sensemaking process comes to the opposite conclusion, that there is no threat, then the status quo continues.

For companies and countries to successfully navigate the systematic changes we are now undergoing, their leaders must examine their own sensemaking process, as well as how it can be translated to the organizational level, and into action.