In a 2006 Teradata survey, 71 percent of 1,200 leaders stated that poor decision making is a serious problem. If leaders were asked in 2011, they would continue to say that decision making is a serious problem.
Effective leaders know that decision making is both art and skill. It includes selecting the method of decision making, preparation, process, and communication.
Before engaging in a decision making process, leaders need to define for themselves and for the organization the method of decision making they will use for any given issue.
This clarity speaks to the art of decision making. Leaders may utilize autocratic, consensus, democratic and consultative methods to address an issue. There are appropriate situations for each method with both advantages and disadvantages.
When a leader decides to use an autocratic method of decision making, he/she is deciding to make the decision alone. This method was common practice in organizations decades ago. Today we suggest that this method be used only when there is critical time pressure or a crisis that demands an immediate response. The obvious advantage to autocratic decision making is that it is fast. However, repeated use of this method will result in distrust and low morale. When employees believe that they are being coerced they will respond with malicious compliance. They will do exactly what they are told to do even if they recognize problems with the decision.
The consensus method of decision making is a shared decision by all team members. An advantage of this method is that individuals are invited to participate in a collective agreement which assumes high level buy in once the decision is made. The disadvantage of the consensus approach is the amount of time it takes to arrive at a decision. It requires that all participants understand the issue and willingly share individual opinions. It requires an ability to compromise for the sake of the greater good.
There are times when a modified consensus method is appropriate. Rather than looking for total agreement on a solution, leaders may invite the question of participants:
“Can we live with this decision?” Assuming a decision is made by consensus or modified consensus, there is an expectation that those who participated will actively support the decision. It is important to use consensus when the decision has a major impact on team members or when the team is making a decision that will impact an entire organization.
Majority rules, while a common method for resolving issues, also creates winners and losers. This is clearly a disadvantage when a leader looks to create a collaborative, team environment. However, the advantage of using the democratic method for decision making is speed. It can be appropriate when the impact of the decision is not significant or when the full support of the team is not critical.
Leaders frequently use the consultative method for making decisions. They ask for input, ideas and suggestions from others before making the decision. An advantage of this method is that leaders have the advantage of considering many viewing points and team members appreciate the opportunity to be heard! However, one of the repeated mistakes or disadvantages is that leaders fail to communicate on the front end that he/she will make the decision. When asked for input, others mistakenly assume that they will have a voice in the final decision. We coach our clients to communicate clearly that he or she will make the decision and that while leaders value the perspective of team members, in the end, he or she is responsible for making the final decision.
Preparation and process
What do leaders need to consider when making decisions? We are reminded of the wisdom of Albert Einstein: “If I had one hour to save the world, I would spend fifty-five minutes defining the problem and only five minutes finding the solution.” Without reasonable information, leaders jump too quickly into problem solving, which results in poor decisions and detrimental business outcomes. Knowing what questions to address is critical to the impact of the decision.
Those familiar with the Myers Briggs model of decision making, know that in each step of the process there are important questions to consider that will enlighten the process and the outcome. The outline below will serve to guide your efforts in decision making for your organization.
- What are the facts?
- What does the past tell us?
- What is the relevant experience of others?
- What are the important details that we need to consider?
Assess Implications of the Decision
- What are the options or possibilities?
- What impact does this decision have on the big picture?
- What will this decision mean to the organization?
Analyze the Pros and Cons
- What is the criteria for making a decision?
- What does logic tell us?
- Is this decision value centered?
- What do others think?
- What is the impact to the people within our organization, clients, stakeholders?
- Will this solution promote maximum ownership?
When leaders invest the time preparing to make a decision, they increase the possibility that the decision will be well received by employees and result in good business outcome for their organizations. Astute leaders know the importance of communicating the process, asking important questions and effectively communicating the final decision.
As you reflect on recent leadership decisions that you have made, how would you assess your ability? What would you consider doing differently as you face future decisions for the sake of your organization? Is decision making for you, both an art and a skill?