Quality of Decision-Making
Decisions are the events that propel a business. From tactical, in-the-moment decisions on how to answer a superior's inquiry about the status of a task, to strategic decisions as to whether the company should launch a new venture, few people ever receive training, nor have a sound model for how to make a well-formed decision. But they are expected to do so quickly, and effectively.
The four key factors in decision-making are the objectives, the decision criteria, the data and the reasoning process.
The four key factors in decision-making are the objectives, the decision criteria, the data and the reasoning process.
- Gaps in alignment lead to weakness in objectives. Obscure objectives propagate further mis-alignment.
- Inability to share difficult-to-discuss opinions lead to decisions that appear to meet public objectives but leave personal decision criteria unsatisfied, leading to actions that don't fully support the intent of the decision, and to subsequent actions that may be contrary or half-hearted.
- Data used in business decisions comes in two forms; factual data and personal inference. Factual data - in the event it is driven through recall - is flawed by our human limitations for accurate recall. Inferences may be accurate or they may be quite incorrect. Not recognizing when a potentially inaccurate inference is being treated as data input and not being able to check the inference's accuracy lead to flawed decisions. Inferences grounded on third-hand information and inaccurate recall compound the issue.
- In almost all business situations, the reasoning process is implicit. It may seem that it's obvious to all, and yet be unique for each individual involved. To question someone's reasoning process may appear to challenge their capability.