Fast and effective decisions lead to fast delivery of benefits
The fastest decision is an impulsive decision, but impulsive decisions are often of poor quality. Because strategic initiatives are complex, an impulsive decision is not desirable. We need to balance the need for decision speed with need for decision quality….
The decision needs to be an effective decision as well as a fast decision.
What is an effective decision? People commonly answer that a good decision is one that yields a good result. The problem with this criterion is delay: we have to wait for the result to know if the decision was good. As leaders, we need to consider decision making in light of unclear consequences that are experienced in the future: good decisions consider risk! Risk is defined as an uncertain event that will impact the endeavor in positive ways (e.g. opportunities) or negative ways (e.g. threats).
A strategic mindset is essential. Specifically, I am always thinking about my decisions and the consequences of the decisions in terms of the definition of success and failure. I use this criterion to guide my decisions:
A good decision is one that increases the probability of success and decreases the probability of failure.
Another answer to the question, “What is an effective decision?” is that an effective decision is based on good information. Detail, data, and perspective can improve decision making. Those take time, so we need to ask ourselves:
- How important is it to get the decision right? If wrong, what are the consequences?
- Are we considering the long-term and systematic consequences?
- Are we considering our stakeholders?
- Is the decision reversible?
Two Ideas for Making Better Decisions
One very useful idea for the strategic initiative leader is to but this list at the top of their meeting agenda: “Decisions to Be Made in This Meeting.” That is because (in my opinion) the most important purpose of a meeting is decision making. Too much time is
wasted in information sharing, and a focus on decisions helps to create energy and progress on the key issues of the strategic initiative.
The second useful idea is to use decision trees to graphically present the choices available to the group. You draw a decision tree by drawing a box on the left side of the paper, and showing a series of branches diverging from this box where each branch is labeled as one of the decision alternatives.An example: I was facilitating a strategy session for a new product introduction. People were confused by all of the issues and choices facing them, including questions such as these: Do we make the key component or purchase it? Do we find an alternative component? I quickly drew and labeled a decision tree that labeled the many alternatives faced by the team. This graphic became a focal point for discussions, and as we discussed each one we started to estimate probabilities and consequences of different risks. Through this discussion, we identified an optimal strategy for the launch.
How do you balance the tension between decision speed and decision quality? What tools do you use to drive decision making?