The Consequences of a Broken Decision-Making Processes
Companies need to find ways managers can make better decisions. McKinsey reported the results of their recent research into dysfunctional decision making at organizations, and those results should concern us all.

  • Less than half of the 1,200 managers surveyed feel that decisions were timely
  • Almost two-thirds reported that over 50% of the time spent making decisions was ineffective
  • Managers at a typical Fortune 500 company could waste over half a million days per year on ineffective decision making

Improving Decision-Making Effectiveness
Clearly, business leaders need to be concerned about the negative impact of ineffective decision-making.  Until you start making decisions by design, managers and their teams will continue to be unproductive, frustrated, and undecisive.

How Managers Can Make Better Decisions in Three Steps
Regardless of the stakes, level of risk, or frequency of the decisions you face, there are three ways to approach decisions – what we call decisions by design – that make a difference:

  1. Promote Constructive Debate
    How are your decision meetings run? Do you start with a presentation of relevant information, continue with a brief Q&A session, and conclude with a vote? This is the usual format.

    What is missing? A real debate about what is at stake, who will be affected, the potential downside, and the upside. Before an important decision is made, research shows that it should be challenged from multiple angles. Far too many strategic bets are made without real discussion of the pros and cons.

    Effective decision making should challenge the assumptions and consider the alternatives to the presenting group’s bias.  This cannot happen unless you create a safe place to disagree and debate. The decision-making team needs to consider all points of view before adopting a plan.

    As long as stakeholders come prepared, this shouldn’t take more than two sessions: one to present perspectives, a break to gather relevant new information, and a meeting to decide on the go-ahead plan.

  2. Establish Good Meeting Discipline
    Be sure meeting participants know the scope of the meeting and why they have been invited to attend. There should be rules that require punctuality, guide respectful behavior, and designate decision rights. Keep the number of participants at a minimum at the same time as you ensure a variety of perspectives.

    And assign accountability for enacting the decision to one person who will report back to the team on a regular basis.

  3. Delegate for Empowerment
    The best leaders have learned that when responsibility for decisions rests in the hands of those closest to the work, better results are delivered faster. And when employees feel empowered to handle and execute decisions, they are more accountable and engaged. All to the good.

    But recognize that unless you allow for occasional missteps, no one will want to own the responsibility of big decisions. Create an environment where workers can fail “safely” and where there is a bias for action.

The Bottom Line
How much time is lost at your company due to ineffective decision making? Probably too much. Do what is in your power to clean up the decision-making process to make more timely, higher quality, and more graceful decisions.

To learn more about how managers can make better decisions, download The Top 5 Decision-Making Mistakes to Avoid at All Costs


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