Defined: Deliberation to determine action to be taken and alternatives to be dismissed. In terms of leadership decision-making, the determination is presumed to contemplate the organization's objectives or goals.
“Wherever you see a successful business, someone once made a courageous decision.” –Peter Drucker
The proposition of making decisions that carry significant consequences for the people and the purposes of an organization can be daunting. Even less impactful decision-making under common everyday business circumstances present challenges and risks. Frequently, the latter class of decisions must be made quickly, under time constraints and pressures, and they're often based on unclear or incomplete information. So, of course, no one is always correct in such decisions. Poor decision-makers tend to choose options impulsively, underestimate the range of necessary considerations and over-confidently project outcomes. But, leaders with strong decision-making skills are able to make judgments grounded on rapid, but correct problem analyses and relevant experience.
Leaders Skilled in Decision Making
- Have sufficient experience, management insight and judgment to make sound decisions
- Promptly and thoroughly analyze relevant information before making decisions
- Understand the difference between decisions that require more deliberation and those that require quick summary analyses
- Are able to distinguish between facts and opinions, and to give appropriate weight to both
- Prefer to make decisions affecting their work environment and goals, rather than risk leaving control of their circumstances to others' decision-making skills and motivations
- Are able to make effective decisions, even when the information is unclear or incomplete
- Reach out for input and advice from knowledgeable sources as necessary
What Prevents the Ability of Decision Making
- Habit of making hasty decisions, without considering risks
- Disregard for conflicting viewpoints and opinions
- Trading the long-term good for short-term benefits
- Fear of consequences, aversion to risk
- Excessive analysis that extremely prolongs decision-making
- Over-confidence and unwillingness to collaborate on solutions
- Ignoring relevant factual data
- Unconscious decision biases, Insufficient objectivity
- Perfectionism, paralysis of decision-making due to excessive focus on minutia
- Failure to employ analytics tools
Self-Coaching Questions on Decision Making
- What self-training and preparatory work have you done to develop your decision-making skills?
- How would you characterize your usual organic decision-making process? Fact gathering and deliberation? Or, shooting from the hip?
- How confident do you usually feel about the daily decisions you make at work? About larger, more impactful decisions you must occasionally make? Are you satisfied with your success rate in making decisions that lead to positive outcomes?
Tips for Decision Making
- Clearly define the issue and the ideal outcome and stakeholders' interests in the decision to be made. Identify and detail the best options and acceptable alternative outcomes and compromises.
- Collect and analyze all relevant data and information for, and against options you're evaluating.
- Think about, learn from, and apply lessons from mistakes made in previous decisions.
- Involve stakeholders in the deliberation process. Be open to changing your mind. Expect unexpected push-back and confusion due to uneven possession and/or processing of facts by participants in the deliberation process.
- In addition to weighing the pros and cons of each option, pay attention to your intuitions about what is likely to work best.
- Check your thinking for decision biases, and consciously address the list of your possible biases, to ensure that you're not tricking yourself into perceiving and evaluating the available options through a lens of bias.
- Use appropriate tools for exploring options and supporting the kind of decision you need to make. These may include deferral to experts, decision tables, software analytics features, production equipment, experiments, scenarios, group brainstorming sessions, researching academic resources, etc..
- Don't spend too little time on major and complex decisions, and don't slow down progress by spending too much time mulling over peripheral details of relatively straightforward issues.
- Put your reasoning to the test before you make a significant decision. Ask yourself, “What's wrong with the decision that seems most right to me?” What might I be missing in my rationale? What are the consequences of a wrong decision?
- Make all decisions with consciousness of their ultimate impact on the organization's primary mission, vision, objectives, and responsibility to shareholders, employees and the community.
- Evaluate the ethical ramifications of decisions that you're considering. Let your first priority be to operate within your personal ethical boundaries in every decision you make. Be clear on the alignment of your own principles with your company's operational ethics.
- Recognize that the decision you make may be wrong. All decisions come with this risk. But, do not let this humble recognition lead to ambivalence and undue fear and delay of action.
Example Goal Statements for Decision Making & Critical Thinking
- I will increase my decision making competency by 20%, as measured by the next 360-survey.
- I will demonstrate high levels of analysis and critical thinking on at least one major decision, as evaluated by my manager.
- Within 90 days I will document 100% of decisions I make in a decision journal.
Developmental Action Plan for Decision Making
- LEARN: Read the article “Decision Making & Critical Thinking Competency”, in the LEADx library.
- LEARN: Read the book Unsafe Thinking by Jonah Sachs (or LEADx book summary).
- LEARN: Read the blog post “Creating a Decision Journal: Template and Example Included” (As of 3/21/19 at https://fs.blog/2014/02/decision-journal/).
- LEARN: Complete the “How To Make Strong Decisions” course in LEADx.
- REFLECT: How might your Big 5 personality impact your decision style? For example, people high in Agreeableness tend to rely on the advice of others. People high in negative emotion tend to put off decisions.
- REFLECT: What are 3 decisions you’ve made that worked out really well? What are 3 that didn’t? What was the difference in how you made the decisions?
- PRACTICE: Pause before you make your next major decision and ask a trusted colleague to “red team” it with you; ask them to challenge your assumptions and logic.
- PRACTICE: Join a committee that has to plan an event where many decisions will have to be made (e.g., charity ball). Practice intentional decision making.
- APPLY: Start a Decision Journal and to build the habit, document your process and thinking even for small decisions.
- APPLY: Serve on an interview committee where you have to decide which candidates will be made offers to join the company.
- APPLY: Write an email to your team explaining the analysis behind a recent decision you made that proved to be unpopular.
- MEASURE: Evaluate how others perceive your development in this area with a 360-survey, or simply by asking your manager and peers for direct feedback.
Additional Point for Thought
The human brain is designed to ignore millions of irrelevant bits of available visual, audible and other sensory information every day. This amazing natural ability allows the brain to avoid sensory overload and to process the inputs that are most relevant to us, enabling us to focus on information we actually need and want for making decisions. It also allows us to absorb details of the kinds of knowledge necessary and desirable for us to digest for our immediate purposes and perhaps for future use. So, our brain's ability to ignore or overlook some information is at least as important as its ability to pay attention to other information, when it comes to making good decisions.
Suggested Additional Resources
- Heifetz, R (1994) Leadership Without Easy Answers, Harvard University Press. ISBN 978-0-674-51858-2.
- Peters, T (2012, January) The Little Big Things: 163 Ways to Pursue EXCELLENCE, Harper Collins, ISBN-10: 9780061894107; ISBN-13: 978-0061894107.
- Vroom, V and Yetton, P (1973) Leadership and Decision-Making, University of Pittsburgh Press, ISBN 978-0-8229-3266-6.
- Hochma, T (Retrieved on 2-14-19) HumanHow Behavioral Economics in Practice, Retrieved from: https://humanhow.com/en/list-of-cognitive-biases-with-examples/.
- Currie, D, Dispenza, D, Flynn, J and Mark T (Editor) (2003, January) Management Decision Making: Towards an Integrated Approach, Pearson, ISBN-13:978-0201619225, ISBN-10: 0201619229.
- Bazerman, M and Moore, D (1970. 2012) Judgment in Managerial Decision Making (8th Edition), Wiley, ISBN 13: 978-1118065709, ISBN 10: 1118065700.
- Samuel, L (2009) Future Trends: A Guide to Decision Making and Leadership in Business, University of Texas Press, ISBN-13: 978-1538110355, ISBN-10: 1538110350.
Suggested Internet Search Terms
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