Taking Time to Think About Decisions

DecisionsI recently read a list of “highly significant leadership qualities”.  No doubt, all on the list are significant.  But I see one glaring omission – that of decisiveness and/or decision quality.  It seems that in the study of leadership skills, we may not pay enough attention to the decision-making process and decision quality.  When we look at leadership results, we may look at the outcome – but do we analyze the decision process that produced that outcome?   With regard to leadership, we talk a lot about relationships, business acumen, strategic thinking – but hardly anything about how decisions are made.  I think it is time to expand our focus and include decision quality in the mix.

The statistics about decision failure are startling.

  • 83% of corporate mergers and acquisitions failed to create any value for shareholders (a KPMG study of 700 mergers)
  • 40% of senior-level hires are “pushed out, fail or quit within 18 months” (a study of 20,000 executive searches)

Our overconfidence wreaks havoc.  A study of certainty in decision making showed when:

  • doctors believed they were “completely certain” about a diagnosis, they were wrong 40% of the time.
  • a group of students made estimates that they believed had only a 1% of being wrong, they were actually wrong 27% of the time.

The above data, culled from brothers Chip and Dan Heath’s book, Decisive:  How to Make Better Choices in Life and Work, are eye-opening when we think of our daily decisions and the process we may or may not use to make those decisions.

One thing is certain – effective leadership and quality decisions are inextricably linked.  You won’t have one without the other.

The difficulty we have with our decisions is that we don’t know how good they are until long after the fact.  We often have no immediate feedback or – even worse – we overlook the signs that our decision is not working.  We miss the opportunity to make a mid-course correction.  And, given our overconfidence (as witnessed in the statistics above), we don’t believe we need to correct because, if something goes wrong, it is someone else’s fault.

Our egos are our enemy.  How often do we opt for the “quick decision” because we know that is best?   Do we limit our alternatives to an “either” “or” scenario?  Are we tempted to stay with the status quo because we can’t think of a better alternative?

In the Harvard Business Review article,  “Why Good Leaders Make Bad Decisions”, the authors (Andrew Campbell, Jo Whitehead, and Sydney Finkelstein) describe the roles that pattern recognition and emotional tagging play in our decision-making.  A particularly telling example is the story of Brigadier General Matthew Broderick and his response to the levee failures in New Orleans during the opening rage of Hurricane Katrina.  Broderick, as chief of the Homeland Security Operations Center, was responsible for alerting President Bush and other senior government officials if Hurricane Katrina breached the levees.  As Broderick heard the initial, conflicting reports regarding the potential levee breaches, he depended on his past military experience to gauge his reaction.  Broderick knew that early reports from the field are often false.  He easily applied that rule-of-thumb to the reports he was hearing from New Orleans.   His response – he went home the first evening of Katrina’s landfall without making the proper notifications.  It was 30 hours after the first levee breach before Broderick communicated the need for Federal help.  As stated above, the quality of our decisions is not immediately known.  Broderick discovered that his automatic ”pattern recognition response” failed him.

To me, the “no decision” decision is equally troubling.  We have seen many of our colleagues vacillate on making decisions or just downright refuse to make one.  Ahhhh – frustration!

Followers want leaders to make decisions, and as part of the process, they want leaders to engage the team.  Dialogue paves the road to decisiveness.  In another Harvard Business Review article, “Conquering a Culture of Indecision”, Ram Charan describes the importance of candid dialogue and open feedback in the application of a robust decision making process.  Charan writes, “Dialogue can lead to new ideas and speed as a competitive advantage.”

Following a systematic decision-making process contributes to decision quality and the best possible outcomes.  Should your decision-making process always include a thorough investigation of options?  Yes.  Should your decision-making process include the (admittedly) annoying but (incredibly) insightful additions of a “devil’s advocate”?  Again – yes!  As a business leader, it is your responsibility to SEEK and FIND those who hold the contrary view to your opinion.  Why search for disagreement?  Disagreement opens your mind.  That other perspective – or three or four other perspectives – provides such great learning and insight.  Is your decision not better off because of it?

We have access to great resources for exploring decision quality and selecting a process that works.  The Heath’s book, Decisive, Daniel Kahneman’s book, Thinking, Fast and Slow, and Dan Ariely’s Predictably Irrational:  The Hidden Forces That Shape Our Decisions, are three highly recommended reads.

Take notice of your decision quality and work to improve it.  We all have looked back and thought, “Hmmmm – that didn’t work so well!”  (Now admit it – you have!)  So, start now to learn more about quality decision-making … and improve your leadership effectiveness.

“Whenever you see a successful business, someone once made a courageous decision.”

― Peter F. Drucker



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