How to Immediately Develop Your Decision-Making Performance

Excerpts from the book: Decision-Making Excellence. See Chapter 1 of the book.

On a complex subject, could we ever reprimand a decision-maker even though the decision was good? The answer is yes! What are the questions to ask when evaluating a decision on a complex subject? Should we evaluate the content of the decision (results obtained) or the process that led to the decision (tools and methods used)? Common sense would lead us to answer that we must evaluate both, but I argue that this is a mistake.

Most organizations evaluate the decision itself: the result obtained in terms of effectiveness (reaching the objective) and efficiency (means used to reach the objective). This mode of evaluation is relevant for decisions involving simple or complicated problems: With time and expertise, the result becomes predictable. On the other hand, this mode of evaluation is dangerous, unfair, even absurd, for decisions on complex problems: strategy, organization, performance development… – if you do not understand the difference between simple, complicated and complex: see chapter 4 of the book The Chief Always Speaks Last .

What characterizes complexity is uncertainty, unpredictability. It is therefore unfair to reprimand a decision-maker on the basis of the result obtained, since nobody can know with certainty what the right decision should be. It is only 6 to 12 months later that we will find out if the decision was right or not. Some decisions can even be very unstable: excellent, then bad the next month, then excellent again. A decision on a complex subject is good at a time T from one person’s perspective. At time T+1 or from another person’s point of view, it can be perceived as bad. The evaluation is therefore both relative and subjective because of the complexity. The unfairness will be amplified by hindsight bias, a cognitive bias that leads us to evaluate a decision with information that did not exist at the time the decision was made. A decision-maker can thus become responsible for a failure, even though it was unforeseeable. The fundamental attribution error can make the situation worse. This is a cognitive bias that consists of attributing success or failure to a person by underestimating the role of circumstances and chance. Faced with this danger, the decision-maker will unconsciously activate another cognitive bias: risk aversion.

Faced with this potential injustice linked to complexity and cognitive biases, the decision-maker will therefore back away from the obstacle at first by multiplying the meetings. He or she believes that with time, a 100% sure solution will fall from the sky. Of course, on a complicated subject, with time and expertise, a perfect solution can be found. However, this will never happen on a complex subject.

So our decision-maker backs away from the obstacle, but despite the number of meetings, the decision to be made is still not known with certainty. The problem is that decision-makers must decide, or else risk their jobs. To protect his or her career, a decision-maker will therefore seek to dilute this responsibility with a collective decision, despite being the only one responsible. The concept of collective decision is indeed brilliant: If it is a success, it is thanks to the decision-maker. If it is a failure, it is the fault of others! We encourage irresponsibility because when everyone is responsible, in fact, no one is responsible anymore.

On complex issues, to avoid slowing down the decision-making process and especially to prevent an unfair evaluation of the decision-makers, I suggest you evaluate the decision-making process rather than the decision itself. Was it made in ivory tower mode (the chiefs think, employees execute)? Was a holistic and systemic analysis of the subject done? Was an iterative approach used? Did the chief speak last during the meetings? Was the floor distributed or in verbal ping-pong mode? Were ideas juxtaposed with a Post-it wall or hybridized using the Round-Table technique?

On simple and complicated subjects, the most important thing is success or failure. Conversely, for complex issues, we should stop evaluating success or failure. Similarly, in the emergence phase of a decision, we should not only value the idea that will be retained, but also the many ideas that all contributed to the final idea through hybridization.

Thus, on a complex subject, whether we are evaluating a decision a few months later or making a decision (helping it emerge), the most important thing is not the decision itself, but how it emerged. The objective is to evaluate managers, leaders or experts only on the “how.” Did they choose the right methods and the right decision-making process?

For decisions on simple and complicated subjects, decision-makers have an obligation of result. Whereas for complex issues, they should only have an obligation of means (in the legal sense of the term): using the right means, tools, methods, processes to make a decision. As an example, as a source of inspiration, these means are described in the manifesto for decision-making excellence published in the appendix of my book on decision-making excellence. I propose 20 principles, which are in fact criteria for evaluating a decision-maker in order to determine his or her decision-making performance on complex issues. It is up to each organization to co-construct its own evaluation model to ensure that it is adapted to the culture, the context and the industry. At the heart of these principles are the know-how and soft skills of collective intelligence, which reduce the negative impact of our 188 cognitive biases and thus limit the risks of making irrational decisions.

Consultants, coaches, lawyers and doctors only have an obligation of means. They are not punished for the result, unless you make a huge mistake, but they can be punished for the means they have used. There would be nothing revolutionary in applying this principle to complex issues for decision-makers.

If an employee presents you with a draft decision on a complex subject, you should first ask them to explain how they have produced this draft decision. If you are satisfied with the answer, they can then present the content of the decision. This is how you can determine the potential quality of the decision and avoid wasting time.

If a decision-maker is reprimanded for not having implemented the 20 principles of decision-making excellence or equivalent, despite making a decision on a complex subject that is perceived as excellent, you will have demonstrated that your evaluation system is perfectly adapted to a complex and uncertain world known as VUCA. The responsibility is therefore on the means: You can be punished as a lawyer or a doctor would be.

When decisions are made in casino mode at the top of an ivory tower: What are the merits of the decision-maker or his or her management committee? When you bet on red and red hits, it does not make you a good decision-maker. You were simply lucky! When you make decisions on complex issues by following your intuition, you are in danger. It is the same as gambling, as explained in this article: Decision: Should You Rely on Your Intuition? Rather than chance, intuition, common sense or instinct, choose a process and a toolbox to support your decision-making performance.

Have you ever seen a decision become a power issue to put opponents in a difficult position? Or a decision becomes a hot potato that everyone tries to pass on to the next person because the decision is too uncertain and risky? All this could disappear if decision-makers only had an obligation of means and not of result as it is now.

The current assessment system is the same whether the situation is simple, complicated or complex. It is very important to have a specific assessment of the complex so that decisions are made quickly rather than too late, without resistance to change or disengagement because execution turns into a nightmare (running in the wrong direction), without creating a culture of irresponsibility (eradicating collective decisions), without injustice for the decision-maker and finally to achieve decision-making excellence through better management of decision-making risks.

Decision-makers should no longer be afraid of being punished for the result.

This is the only way to encourage them to focus their energy on the means to develop their decision-making performance. If you do not perform a “quality control” on the decision-making process for complex issues, you are not effectively managing the risks in your organization.

Complex decisions (strategy, reorganization, performance development) are implemented with complicated decisions (choice of means) and then simple decisions (objectives, tasks). If the complex decision is wrong, it will affect all subsequent decisions. If you run fast, but in the wrong direction, your decision-making excellence in the simple and the complicated no longer matters… and you may even be punished for being unable or struggling to implement a complex decision that is actually inappropriate! Because of this chain reaction, evaluating decision-making performance in the complex is fundamental. The table below provides a summary of the issues.

To learn more about the issue of performance evaluation in a VUCA world, I invite you to look at Chapters 1 & 10 of the book Decision-Making Excellence and Chapter 14 of the book The Tea Strategy. More specifically, these chapters will give you more details if you want to implement the qualitative evaluation: practical details of a 360° feedback on the talents observed.

In conclusion, to develop your decision-making performance immediately, the obligation of result should be replaced by an obligation of means if the decision concerns a complex subject. Nothing revolutionary, it is already the case for your lawyer or your doctor. The day when we also do this for political leaders when they deal with complex issues, our democracies will make a great leap forward: We should stop criticizing their decisions and instead judge the way decisions are made. With complexity, the concept of “bad decisions” is scientifically absurd. We can create cohesion within a group by looking for scapegoats (negative results), but we could do it even better by celebrating collective successes because we used the right means.

Do you get irritated when your manager does not take the time to assemble a group to reflect on a problem because it is faster to think alone? Unfortunately, he will not change his attitude until he is quantitatively evaluated on the 20 principles of decision-making excellence or equivalent. Design Thinking is imposed for innovation, Lean Management is imposed for operational excellence, but nothing is imposed for decision-making excellence considering that it is mainly an art, a question of intuition, courage, intelligence or instinct. This is a mistake that can become fatal in complex situations. Decision-making excellence should become a management standard.

This article deals only with decision-making performance and its evaluation within an organization. It excludes liability related to compliance with the law (crimes and misdemeanors). It does not apply to external stakeholders such as shareholders, suppliers or customers. It is normal to change your lawyer when he or she loses your case, to change your doctor when he or she does not cure you, to change a top executive when financial, social and environmental performance are not there (just as a political leader will not be re-elected) or to change a store or a brand when you are not happy with the service provided or the product delivered. From the outside, only the result counts!

Regarding decision-makers who use the right means without ever or rarely obtaining results, it is logical to imagine that they will sooner or later be “reoriented” as part of their career evolution. The objective is not to reward mediocrity. However, this lack of results could also be the consequence of a lack of diversity linked to a clone recruitment policy. In general, the clone army is the result of many cognitive biases: affinity / similarity bias, projection bias, so-called endogroup bias, halo effect, Dunning-Kruger effect, etc. Collective intelligence is nourished by diversity. If we impoverish it, we mechanically increase risk in complex decision-making, we reduce creativity and the organization does not really give all the means to decision-makers to achieve decision-making excellence.

Many thanks to the people who contributed to the writing of this post (in alphabetical order): Anne Betton, Arnaud Brouxel, Michel Bundock, Thierry Denys, Stéphane Durand, Claude Emond, Sylvie Krstulovic, François Lavallée, Guillaume Peter, Sylvie Pruvost, Dominique Turcq and Marc Weltmann.

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Author: Olivier Zara

https://www.linkedin.com/in/olivierzara/

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