Wednesday, June 13, 2018

Many decisions are no decisions (and this makes projects difficult)

Effective decision making
Again and again, I am confronted with the situation during projects that I ask for a decision on something and as an answer I get "Oh, that has been already decided...".

No, it is not. A decision has NOT been made until people know:

- the name of the person accountable for carrying it out;
- the deadline;
- the names of the people who will be affected by the decision and therefore have to know about, understand, and approve it—or at least not be strongly opposed to it; and           
- the names of the people who have to be informed of the decision, even if they are not directly affected by it.

An extraordinary number of organizational decisions run into trouble because these bases aren’t covered.

It’s just as important to review decisions periodically—at a time that’s been agreed on in advance—as it is to make them carefully in the first place. That way, a poor decision can be corrected before it does real damage. These reviews can cover anything from the results to the assumptions underlying the decision. Such a review is especially important for the most crucial and most difficult of all decisions, the ones about hiring, firing and promoting people.

When it comes to making decisions I am of the opinion that people and organizations should use a simple decision-making process in order to make them effective. Personally, I use the one outlined by Peter F. Drucker. In 1967, he wrote his famous article on effective decision making in The Harvard Business Review that still stands the test of time. You can find it online here. Drucker defines the following six steps for effective decisions.

1) Classifying the problem. Is it generic? Is it exceptional and unique? Or is it the first manifestation of a new genus for which a rule has yet to be developed?

2) Defining the problem. What are we dealing with?

3) Specifying the answer to the problem. What are the “boundary conditions”?

4) Deciding what is “right,” rather than what is acceptable, in order to meet the boundary conditions. What will fully satisfy the specifications before attention is given to the compromises, adaptations, and concessions needed to make the decision acceptable?

5) Building into the decision the action to carry it out. What does the action commitment have to be? Who has to know about it?

6) Testing the validity and effectiveness of the decision against the actual course of events. How is the decision being carried out? Are the assumptions on which it is based appropriate or obsolete?

Posted on Wednesday, June 13, 2018 by Henrico Dolfing