I’m a huge fan of Dilbert cartoons, partly because their wry observations on daily life in large companies often cause me to laugh out loud and partly because these same observations often provide valuable warnings about the challenges and pitfalls that face employees. Naturally, many of my favourite Dilbert cartoons relate to decision-making within large companies. Here’s just one example:
I have discussed previously decision-making by groups, some of the ways in which it can fail, and how it has the potential to produce better decisions than does decision-making by individuals.
What about decision-making in large organisations, which are made up of many different groups (teams, departments, business units, etc.) working together?
Large organisations are complex social and economic systems in which thousands of decisions are taken every day that will collectively determine the health and the success of the organisation. As Daniel Kahneman writes in his excellent book “Thinking, Fast and Slow”:
“Whatever else it produces, an organisation is a factory that manufactures judgements and decisions. Every factory must have ways to ensure the quality of its products in the initial design, in fabrication, and in final inspections. An organisation that seeks to improve its decision product should routinely look for efficiency improvements at each of these stages.”
I conducted an action research project with one such large organisation with the aims of:
- Developing a deep understanding of how decisions were made within the organisation, particularly to identify factors that supported or inhibited good decision-making.
- Testing the benefits of applying the ELECTIA approach to decision-making to decision-making by groups within the organisation.
A team of 29 volunteers helped me to gather data on almost 300 organisational decisions and on over 50 applications of the ELECTIA approach.
My action research project generated many detailed findings, however the main findings, which I are believe are likely to be relevant for most large organisations, were as follows:
- Collective decision-making was rarely guided by either a standard process or by any discussion about the decision-making process to be adopted. As a result, most decision-making involved assumptions made by those involved about the process for making the decision and about who was to be involved, when and on what basis. A lack of clarity on these aspects of decision-making was reported by the project participants in 22% of the decisions that were recorded and analysed.
- Lack of clarity regarding either the decision-making process being used and/or who was the decision-maker was found to be associated with a high degree of failure to make a decision and, when decisions were made, with decisions that were perceived to be of lower quality.
- Lack of clarity was particularly prevalent in ‘cross boundary’ situations, e.g. within matrix teams or for decisions involving participants in different departments or parts of the business.
- Active intervention in collective decision-making by the project participants using the ELECTIA approach substantially increased both the likelihood of making decisions and also the perceived quality of the decisions that were made. In fact, use of the ELECTIA approach completely eliminated decisions that were perceived to be ‘poor’ in this study.
The implications of these results are that, despite being “factories for manufacturing decisions”, organisations often do not attend directly to the quality of their processes for making decisions or to the quality of their “decision products”. Teams within organisations often become focused only on the subject matter of the decisions that must be made (“the what”) and lose sight of and make assumptions regarding the method for making those decisions (“the how”). Leaders don’t act to ensure that effective and efficient approaches to decision-making are applied routinely. As a result, employees may feel just like Dilbert in the cartoon above.
Therefore, substantial benefits for the quality of organisations’ decisions can be achieved by:
- Focusing the attention of individuals and teams on the quality of decision-making processes and on the quality of decisions that are made. Once attention is focused on these areas, individuals and teams can often identify for themselves some ways in which they can improve the quality.
- Providing guidance in the form of simple approaches, such as the ELECTIA approach, to help individuals and teams to improve the quality of decision-making processes and the quality of decisions.
- Building the capability of leaders to create, facilitate and embed high quality decision-making processes through specific training and coaching.
When you next find yourself involved in some collective decision-making within your organisation, empower yourself to intervene in the discussion with these questions:
- What is the decision that we need to make? How does it fit into the bigger context?
- Who should be the decision-maker(s)? Who else needs to be involved, at what stage and on what basis?
- What should be the process that we follow for making the decision?
My research shows that asking these simple questions will create clarity for you and for the others involved in making the decision, and that this will help to ensure that you reach a decision and help to ensure that you make a better decision. Let’s just hope that your own Pointy Haired Boss doesn’t respond this way: