High Stake Decision Making

Amy Gallo, who is a contributing Editor at the Harvard Business Review, recently posted on How to Make High-Stakes Decisions, in which she referenced some of the thinking of Sydney Finkelstein (the Steven Roth Professor of Management at the Tuck School of Business at Dartmouth and co-author of Why Good Leaders Make Bad Decisions) and Michael Roberto (the Trustee Professor of Management at Bryant University, and author of the classic HBR article What You Don't Know About Making Decisions).

The key advice from this blog distilled down to 2 key elements (i) Involve others, but own the outcome (ii) Trust - but challenge - your gut reaction (including, Be wary of past experiences & Recognise your bias)

On element (i)

Big decisions shouldn't happen in a vacuum. "You have to have a team. You can't rely on yourself" says Finkelstein. By consulting others, you expose yourself to differing opinions, which will help you make a more informed choice, and give you a better shot at winning buy-in from those who will be affected. At the same time, beware of the risks. "If you have a lot of people involved, almost always a small subset take control and make the decision", which can make the larger group's contribution negligible, Finkelstein says. Also, while important issues, such as changing the strategic direction of the group or hiring a new manager, typically require input from many sources, at the end of the day, one person needs to be accountable. Ultimately, "the leader has to decide", he explains. "I'm not a great fan of consensus".

On element (ii)

Many people make big decisions by relating the current challenge to what they've done in the past. It can serve you well to make these connections, but there are drawbacks as well. Finkelstein says people tend to rely on their past experiences even when they're not relevant. Roberto concurs. "The problem is that when we reason by analogy, we focus on all the similarities, and we often ignore the differences between related situations. And the differences often are where the problems are, where the challenges are". Bring in previous incidents (including 'first instincts' you may have) as a source of data, but question how pertinent and useful they truly are.

There are clear parallels between the 2 key elements highlighted here and the work FranklinCovey does with leaders to enable better decision making. For instance, in terms of involving others (while still owning the outcome), the Synergy process we work with encourages leaders to value diverse inputs and overcome group characteristics which lead to strong individuals asserting their perspective over others. It also highlights specific barriers to the synergy process and provides a repeatable process for generating 'third alternative' ideas. Balanced against this, the thinking from FranklinCovey's Disciplines of Execution process seeks input from others in terms of translating key high-level goals to the front line, but re-inforces the leaders role in being responsible for setting these goals in the first instance.

Likewise, when it comes to Challenging gut instinct and Being wary of past experiences, FranklinCovey's 'Basic Change Model' encourages leaders to constantly assess their 'autobiography' and accumulated paradigms as the filter through which they see things, and our thinking on Proactivity provides a structure for critical thinking between any given stimulus and the corresponding response. This structure for critical thinking is then added to within the 'Enquiry' / 'Opportunity' process we advocate leaders and teams use when trying to make decisions and get to solutions which will help them succeed.