Decision Making

Even the best managers in the world sometimes make poor decisions. Roughly 40% of decisions made by first class managers turn out to be wrong in some way. We can recognise poor decisions more easily by being honest with ourselves, and by avoiding rationalising our actions.

One large decision can generate many smaller ones, so there is a crucial need for good decisions. Uncertainty is an inevitable part of any decision; otherwise there would be no need to decide.

There are two broad ways of making a decision:

• ‘Rational’ planning process - Assess the costs, benefits and probable outcomes until the ‘best’ resolution surfaces.
• ‘Hunches’ or intuitions - No planning, action creates information and information reduces uncertainty.

Most of us use one method more than the other, or only one method exclusively. The preference depends on an individual’s training and personality, but does limit the decision making process. Complex decisions, especially, could benefit from considering the use of both methods.

Make sure your decisions are not undermined by subconscious assumptions or ‘cognitive biases’. Once you’ve learnt to recognise these assumptions, you’ll be able to make strong, clear and justified decisions with a far greater chance of success.

Selective Research

This is when you’ve already come to a decision about a problem, even a subconscious one. If you have made your mind up without looking at all the possibilities you will make an uninformed decision.

A research plan is a list all the things you need to find out, and all the sources that you can approach. Keep a record of your research, including relevant notes and observations of where and when you found the information. You’ll be able to follow up connections made at a later date.

Preconceptions

By the time all of the evidence has been gathered you’re already likely to know how to interpret it. Analyse material rigorously, or you’ll risk missing important issues relating to your decision.

Types of preconceptions:

• Only the evidence that supports a particular interpretation is taken into account

• Information gathered at either the end or the beginning of the period of research has a disproportionately strong influence on the decision

• Unwillingness to change thought patterns

Subjective Decision-Making

Inevitably some of your decisions will be biased, or subjective. The colour of your new car, the tunes on your mp3 player, who you choose to eat lunch with – all of these decisions are subjective.

An unbalanced decision would be one made, for instance about a customer’s product based on your opinion of their colour scheme, the customer’s political views, or on what the most of your team think.

Conclusions

There is no magic solution to making strong decisions. You need to research and take into consideration all the relevant information whilst considering your evidence, sources and solutions.

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