Making Better Management Decisions
You’ve probably read hundreds of articles from “experts” who have ideas about making better management decisions; but if you don’t have a lot of time to review them all, consider using this information as a valuable timesaver.
Common Decision Errors
Three common mistakes pervade the decision-making arena:
- Paralysis of analysis. Thinking too much and over-analyzing conditions before making a decision can destroy the timing of an otherwise sound choice. Over-thinking or excessively evaluating available options can cost time and effectiveness.
- Making immediate “seat of the pants” decisions. Rushing into a decision based on habit, bias or a “this is the way we’ve always done it” approach is often just as debilitating as over-thinking a decision. While intuition and feeling have a place in decision making, it should not take centre stage. Business is too complex for this approach to work consistently.
- Ignoring the facts or the data before making a decision. Much like a combination of errors (#1 and #2), this mistake occurs when managers have access to available data, but choose to ignore it for a variety of reasons. Hard data may indicate one decision. Yet, the manager ignores this information and makes another choice.
Harvard Business School associate professor Michael Norton studied this issue in his article, “From Thinking Too Little to Thinking Too Much: A Continuum of Decision Making.” He and his co-author, Dan Ariely of Duke University, documented their research for Wiley Interdisciplinary Reviews: Cognitive Science.
Norton and Ariely found that there was much research surrounding under-thinking, fast decisions and those managers that had data but ignored the information. Much less study was dedicated to examining over- thinking a decision, despite its prevalence as a hindrance to effective decision making.
Decision-Making Balance
Habit is a strong motivator in decision making. As the business landscape changes at breakneck speed, habit-driven decisions can be harmful to your employer—and your career.
Try to strike an intelligent balance between under- and over-analyzing current data before making decisions. Even Norton could not define a one-size-fits-all solution to the problem. Most recently, he began using MRIs to study the brain chemistry of successful decision makers to learn if their neural signatures provided some concrete information, but there have been no facts released yet.
Try to eliminate your biases, evaluate the data and choose the best remaining option to make the best decisions. Use your experience, expertise and history to form the basis for solid decisions, in light of the available data. Balance your analysis with your intuition and experience to make winning decisions.
While there are no guarantees, you’ll make better decisions by considering good information, focusing on employer goals and being fearlessly decisive. Be ready to modify, expand or contract your decisions if necessary. Flexibility is an important trait in contemporary business. Balancing your evaluation with timing issues will improve your decision quality.
Set aside some quiet time to think about your decisions. Do not activate your auto-pilot button. Do not spend too much time considering your options. Evaluate, analyze and then act. As your experience and expertise increase, your decision making will consistently improve.
This article is, in part, sourced from:
http://hbswk.hbs.edu/item/6630.html
