Wednesday, 16 October 2013 08:58

Decision Making - A Critical Success Factor

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pitagorsky Oct16Decisions drive projects. There is a decision to proceed that makes a project a project. There are decisions regarding requirements, the choice of resources, design approach, and various other issues. Decision making is a critical success factor.

Ways to Make Decisions

There are three primary ways to make a decision in a group, by authority, by majority (or plurality), and by consensus. Compromise, conflict avoidance and assertiveness, dialog, debate and facilitation are techniques used in the decision making process. The art of decision making calls for the practical application of these in an approach that depends on the needs of the situation. There is no absolute one best way.

Consensus decisions are those made when everyone in the group agrees to a single outcome. The outcome may not be everyone’s favorite decision but everyone agrees that it satisfies the objective. Consensus decisions arise out of dialog and debate that engages people with divergent ideas, common objectives and constraints. They converge on a decision that satisfies their common objective within the constraints. Consensus decisions can be good, bad or anywhere in between. Bad ones are likely when the group is overly homogeneous or when members do not act upon their responsibilities to be actively engaged in the process. Consensus implies open mindedness and a willingness to let go of attachment to one's own idea and accept the ideas of others with objectivity. When this is missing, there can be a consensus around an ineffective decision.

Majority decisions are those made when more than half the participants are in favor of an outcome. In the realm of projects and organizations, there is a problem with majority rule. Majority rule leaves a minority that may not be sufficiently bought into the decision to motivate their best efforts to actualize it. Further, there is little or no correlation between the number of people in favor of an idea and the worth of the idea. There are many examples of large majorities favoring an idea that turns out to be truly horrible, even after a small minority made a point to show its weaknesses and offer more effective alternatives. While majority rule may be an effective base for governing, it is in need of moderation to protect minorities from the tyranny of the majority. 

Authority decisions are made based on the power of an individual or small group. The authority figure can make the decision because he or she is the authority figure. Authority decisions can run the gamut from very good to very bad, depending on the intelligence and skill of the authority figure. Impatient, ego-centric, fearful and unintelligent authority figures will make decisions that are far less effective than the decision of any of their subordinates. Well informed, intuitive and intelligent authority figures can make highly effective decisions. They often hold back on their decisions to allow for some degree of open discussion by subordinates and to collect the information required to make the right decision.

Factors Influencing the Approach

Applying situational management principles to decision making we see that the decision approach is influenced by factors such as the time available to make the decision, the "style" of the decision makers, the desire for broad group buy-in and the criticality of the decision.

The approach that works best is often one that combines techniques. For example, if the decision is one that must be made by a particular point in time, decision makers are often most effective when they shoot for consensus and then fall back on authority decision making when time runs out or it becomes clear that the consensus building process is not going to be fruitful. Votes can be taken along the way to assess the degree to which there is agreement or disagreement among the decision making group.

What is a good Decision?

Decisions are made to drive action. A decision made but not acted upon is useless.

Is a decision made and implemented in a way that fails to achieve the objectives that underlie the decision, a poor decision? Arguably, a well made decision can be considered a "good" decision even if the outcome does not meet objectives. In other words, the operation can be a success even if the patient dies.

Rather than using the term "good" decision, I prefer "well made" decision. A well made decision is one that integrates all the right tools and techniques, makes use of the available knowledge, is based upon intelligent analysis, includes effective use of intuition and subjectivity, and engages the right people in the right way and at the right time. The outcome of the application of the decision is another issue. Decisions are made based on assumptions. The assumptions are necessary because the outcome is in the future and therefore uncertain. 

So, a decision to move ahead with a project to create a new product may be a well made decision but the product may be a total failure because the market place changed in a way that the decision makers could not have anticipated. 

What if the decision makers could have anticipated the change, had they taken the time to do a little more research or had they involved other people with a broader range of knowledge or ideas? Then the decision would be poorly made.

Decision making factors

Decision making requires patience, objectivity, method and intelligence.

Patience is needed to overcome the desire to get the decision making over with and eliminate uncertainty. Patience allows us to sit with uncertainty and accept it. It is said that it is wise to postpone a decision as long as possible to allow the time to discover as much about the decision content as possible. It is particularly important to exercise patience when faced with a decision that must be made within a time constraint. Patience in this case does not imply taking all the time in the world. It means being clever enough to not be driven by the deadline to the extent that there is unskillful rushing. Patience implies using the time available as effectively as possible, avoiding analysis paralysis, avoiding the panic and the rushing it leads to that deadlines often bring.

Objectivity is needed to clear one’s mind of the emotional attachment to an idea because one owns it. A person might own an idea because it is his or because it belongs to someone who is considered to be an expert. Objectivity requires questioning everything. If after questioning and assessing it is found that the idea is worthy, then act on it. It is not the source of the idea that has to be worthy, it is the idea itself. 

Objectivity implies not being driven by greed, ignorance, and anger. 

Objectivity also implies the kind of pragmatism that enables decision makers to accept less than perfect outcomes. Spoiling the good enough for the perfect is a common barrier to effective decisions. It is an objective pragmatism that allows decision makers to recognize practical realities and make them part of the decision criteria. For example, can the decision be implemented in the real world environment, given its politics and capacity for change?

Interestingly, being objective enables a decision maker to use his intuition. Gut feel is as much a part of making an effective decision as the results of analysis. The objective decision maker understands how to balance the two.

Method combines techniques like facilitation, dialogue, debate, negotiation, research and analysis. For group decisions, communication techniques are the most critical. Facilitation brings out information creates a space for the decision makers and their supporting subject matter experts to exchange facts and opinions. Other techniques enable the decision team to navigate within the space to determine the outcome.

Intelligence has two meanings. One is about the information required to make an effective decision. The other is the ability to acquire and use knowledge and experience. Both are required for effective decision making. Without the right information, even the most intelligent people will make poor decisions. Without the ability to acquire and synthesize the information at hand, decisions will be poor even with huge amounts of the right information.

When we combine patience, objectivity, method and intelligence we have the factors that make for an effective decision. Effective decisions are a critical success factor for successful projects. Optimal performance in this critical competency is to be cultivated through an acknowledgement of the need, training, recognition and emulation of effective decision making and the implementation of formal processes.

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George Pitagorsky

PMTopContributorGeorge Pitagorsky, PMP, integrates core disciplines and applies people centric systems and process thinking to achieve sustainable optimal performance. George authored The Zen Approach to Project Management and PM BasicsTM. He teaches meditation and is on the Board of Directors of the NY Insight Meditation Center.

 

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