- ”Every once in a while a bad idea will pay off” (Willie RobertsonCEO, Duck Commander)
I am amazed that one of the most important business processes (remember that word!) is ignored, and bereft of any training. As the quote suggests, it seems to be accepted as a fact-of-life, that decisions just ‘happen’, and will by luck occasionally be correct.
Let me establish a context for my essay on better decisions. I presume a decision involving two or more individuals that normally collaborate as a team. My background suggests this as management staffs, which regularly work, debate, and make decisions together on a regular basis. Accordingly, making decisions is a skill to be honed, and continuously improved upon.
- Frame the problem & charter the team or individuals responsible for a solution. A classic Einstein quote captures this beautifully: “The formulation of the problem is often more essential than its solution, which may be merely a matter of mathematical or experimental skill.” Part of the ‘problem framing’ could be a realization that sufficient expertise needs to be brought-in to assisInitially, the ‘team’ that is charged with the process needs a clear mandate. My favorite is the CAIRO method, an acronym that describes the roles of constituents as follows: C = consult, A = approve, I = inform, R = Responsible, O = Omit. There should be no ambiguity about thisOnce this scope & responsibility has been socialized, the decision teams themselves (the ‘R’ in CAIRO, as those responsible for the decision) need a structured approach to achieve their mandate.
- Implement a structure that will drive the decision the fact you use a process is more important than the process you use. However, some of the common attributes should be:
- Options are formulated and examined on their relative merits. These options can be quite complex, for example, when investment alternatives are being weighed against one another. In these type of scenarios, criteria need to be formulated
- Tradeoffs, pros/cons of each option need to be considered. What are the perceived consequences of selecting one option vs. another? What risks accompany each option’ An option may be highly desirable, but impose significant risk
- Ramifications/ Consequences specifically, what results will occur by not selecting certain options,
- Implementationonce selected how will the ‘decision be executed. The complexity can vary widely based on the problem / decision set. His step is a key element in gaining support and consensus.A structured process will serve as an ‘audit’ trail, if decisions are questioned in the future. The ability to demonstrate a structured approach will lend legitimacy to the decision, as well as build credibility for those involved
A decision process that I am particularly biased toward is described in the book by Hammond, Keeney, Raiffa; Smart Choices A Practical Guide to Making Better Decisions, It employs a system called PrOACT (Problem, Objectives, Alternative, and Tradeoffs. It is very thorough and easy to implement.
3 Challenge objectivity I am not a trained psychologist, but I have managed long enough, and worked alongside enough colleagues to have a rudimentary understanding of the bias and subjectivity we all bring to our professional duties, including myself. Self-awareness is a sign of maturity, and sensitivity to what ‘cognitive bias’ we each bring to our decision-making is a critical character trait. See the excellent Wikipedia article on this. My mention is merely to make you aware of the myriad ways we stifle objective decision making.