How to Make Great Decisions - HBR
Seeking broad consensus requires considerable compromise to incorporate each person’s perspective. The result is a decision that is the lowest common denominator: a choice that everyone can live with, but no one is really happy with.
Worse, consensus-seeking is almost always excruciatingly slow, and the higher up a leader climbs, the less often they are afforded the luxury of time.
At the opposite, when you are asked to make quick, critical decisions in response to sensitive events, those decisions made under pressure might be at least as good, if not better than the ones that you spent days agonizing over.
Knowing that you can make good decisions under severe time pressure, what’s the DNA of those decisions — what actually makes them good? And if you could be disciplined enough to impose your own time pressure on decision-making, could the resulting decisions be both faster and better?
Learnings can be distilled into eight elements that optimize both the speed and accuracy of decisions, while greatly enhancing the outcomes of your team.
The Eight Elements of a Great Decision
Learning to make good decisions without hesitation or procrastination is a capability that can set you apart from your peers. While others vacillate on tricky choices, your team could be hitting deadlines and producing the type of results that deliver true value. That’s something that will get you — and the team — noticed.
The only surefire way to evaluate the efficacy of a decision is to assess the outcomes. You’ll discover, over time, whether a decision was good, bad, or indifferent. But if you rely only on retrospective analysis, the path to better decisions can be tenuous: Hindsight is incredibly prone to attribution bias.
That said, if you had a checklist of attributes to prospectively evaluate a decision (like the one provided below), you could predict in advance whether or not it is likely to be a good one. Based on my experience, these are the eight core elements of great decisions.
1) Great decisions are shaped by consideration of many different viewpoints.
While consensus-seeking should never be your goal, this doesn’t give you the freedom to act unilaterally. For a decision to be properly formed, you need to consult with those who can contribute in a meaningful way.
This doesn’t mean you should seek out everyone’s opinion. The right people with the relevant expertise need to clearly articulate their views to help the accountable decision-maker (aka you) broaden their perspective and make the best choice. Seeking valuable input is the primary source of healthy, robust debate. It will help you gain a greater understanding of the problem you are trying to solve and come up with smart, effective solutions.
2) Great decisions are made as close as possible to the action.
Who exactly should you seek feedback from before making a decision? People who have the most extensive knowledge, experience, and perspective on the issues at hand. This is generally someone who works at a lower level in the organization — not necessarily someone in the room where the decision is being made.
Remember that the most powerful people at your company are rarely on the ground doing the hands-on work. Seek input and guidance from team members who are closest to the action — and give them credit for actually making your decision a better one.
3) Great decisions address the root cause, not just the symptoms.
You may be wondering what kind of information you should seek out from your team members or colleagues. Often, when faced with a difficult problem, we focus on identifying the symptoms, not the core issue that caused the problem in the first place. If you do this, the same problem is sure to reappear down the road.
Although you may need to urgently address the symptoms, once this is done, you should always develop a plan to fix the root cause. Reaching out to people who are closest to the issue at hand will help you identify what this is. Use your time with them to gather that information.
4) Great decisions are made by a clearly accountable person.
Even after receiving the feedback you need to make an informed decision, remember that you and you alone must be ready to claim responsibility for your choice. Weak leaders find it comforting to have their decisions endorsed by the people around them. They don’t want to feel exposed by making a decisive call that might prove unpopular, regardless of how necessary it might be. But when accountability is shared, it dilutes your decision and your effectiveness as the person making the call.
When you’re finding your footing as a leader, going out on a limb can feel scary, especially when you’re just starting to build your confidence. Even so, taking control and ensuring that every major decision is made by a clearly accountable person is key to building trust with your team members and your superiors, modeling autonomy, and improving overall performance. Without accountability, the only weapons in your arsenal are management by committee and decision-making by consensus.
5) Great decisions consider the holistic impacts of a problem.
One way to build up your confidence is to regularly practice balancing the risks and potential impacts of each decision you make. This is simply a matter of thinking as broadly as you can to identify the “what ifs” of your choice. How likely is it that a potential negative outcome will arise and, if it does, what would the consequences be?
For example, even making a relatively simple decision to alter the scope of one of your team’s projects might require you to consider the possible impacts on budget, resource allocations, timeframe, quality, and customer satisfaction.
6) Great decisions balance short-term and long-term value.
As you’re thinking about risk vs. impact, also consider the short-term vs. long term costs and benefits. Short-termism is a curse that plagues many leaders’ decision-making frames. It’s seductive to only consider short-term outcomes, particularly when you’re judged purely on the delivery of your annual work.
The further you progress in your career, however, the more obvious it becomes when you don’t pay sufficient attention to the long-term implications of your choices. Finding the right balance between short-term and long-term considerations is key to unlocking true value. The earlier you can incorporate this into your decision-making process, the better.
7) Great decisions are communicated well to stakeholders.
Whereas you don’t necessarily want everyone with a passing interest to participate in the decision-making process, you do want everyone aligned on the outcome. That’s why communicating the substance and reasoning behind your decisions to the stakeholders (including the powerful people in the room) is so important.
The purpose of this communication is not to seek approval or consensus on how you will solve the problem. Rather, you’re looking to bring everyone up to a consistent level of understanding, which is often necessary for the smooth implementation of a major decision.
8) Great decisions are timely.
Speeding up your decision-making process starts with understanding the core elements of a good decision. If you consider all of the elements listed above, then it’s simply a matter of addressing each one with a heightened sense of urgency.
For example, instead of painstakingly consulting everyone who wants to share their opinion, seek feedback only from those who can genuinely add value — and don’t wait for all of them to agree. Instead, use your own judgment, and a cost-benefit analysis, to chart the best course forward with the information you receive.
Many leaders procrastinate on decisions because they’re overwhelmed by fear of making a mistake or, even worse, of not being liked. But the extent to which you might labor on any particular facet of the decision-making process should be determined by one thing: risk. Your assessment of risk will dictate whether you should take a more or less cautious approach.
With a commitment to prospectively evaluating your decisions, you’ll find yourself able to make better decisions, faster than you’ve ever done before. Learning this as a leader will accelerate your development and lift the performance of your team. The higher up you go, the greater the impact this skill will have on your organization’s culture and performance.
To read the complete article from HBR, please click here.