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What if I told you that you’re actually not that great of a decision-maker… Would you be upset?
Would you argue?
Or would you accept it and tell me “I’m working on it”?
We make decisions all the time. Some are quick (what shall I wear today? Will I get a croissant with my coffee? Will we get take-out for dinner? Will I buy those shoes?), some are more calculated (Which sound system shall I buy for the house? What hotel shall we stay in for our vacation?).
Our quick decisions are often good (and also often bad), and our more calculated decisions are also often good (and very often bad) – they’re just easier to share or assign blame to others and alleviate the pressure on ourselves for the poor decision.
In our personal lives, we have the power and responsibility to make our own decisions. In our professional capacity, we have a responsibility to make a good decision that is best for all stakeholders in the business: its management, its employees and their families, and its customers.
That’s an awfully big responsibility, and to compensate, the power to exercise discretion is often removed from less experienced or lower-level employees, meaning they must follow a process, arrive at the conclusive outcome and take the specific course of action.
Discretion is a breeding ground for bias, and it is wherever we have the power to exercise discretion that we often make poor decisions without realising it.
Have you ever done any of these?
- Make a list of pros and cons for each of the avenues that we could take, reflect on the methodical list, only to go against the logical conclusion and take the preferred path anyway, even if the path we prefer comes out worse than others. For example, when deciding on a partner versus another prospective partner, you make a Pro/Con list for each, only to remove some cons if the person you “in your heart” prefer starts looking worse off than the other one.
- Justify your decision using after-the-fact criteria that you come across as you experience the aftermath of the decision, rather than make that decision based on those criteria before deciding. For example, you decide to buy this one specific car and as you drive it around for the first few days, you encounter features that you really like about the car that you didn’t know before buying it. You ignore or down-play less than desirable features, like that it guzzles fuel or has no electric windows in the back.
Both of these examples above are matters of personal preference and don’t have a huge business impact.
But what if we applied them to work?
Have you ever:
- Compared two candidates after interviewing them and when calculating their evaluation scores, given the person you really really really liked an extra mark so that she comes out on top of the other candidate?
- Invested in a large software package because others recommended it, and as you start to use it you come across features that you really like – however the features that bug you slightly, you downplay or ignore – and if the investment approval for this software has to be approved by another department, design the tender document using the features of the solution you prefer so that no other vendor can compete?
Skilled negotiators and salespeople will leverage and exploit our biases, our judgements and our heuristics (mental shortcuts) to get a decision from you that is in their favour. They will develop and build rapport, getting you to like them. They will anchor you to a number to get you primed for a price, or volume of units to purchase. They will reverse-engineer your requirements into benefits and features so that you come away thinking that this product/service/offering meets all of your needs.
Effectively, they manipulate your brain to make a decision that benefits them, which may not necessarily be the best decision considering all of your options.
Being a good decision-maker is not an innate skill. It is learned. As is being a poor decision-maker, but let’s focus on being good at this.
Some practices for making good decisions:
Take discretion out of the equation in as many places as possible.
Taking away your capacity to exercise discretion is, in some companies, considered childish and disempowering, but that’s only when the formula or process has been designed without your input. You can design the formula or process and use it only for yourself if you wish. For example, when hiring – how do you make a good hiring decision? Well, define very clearly what the hiring criteria are for this job role. What is the hiring bar that all candidates must meet in order to be considered? What is trainable versus what is essential (and be realistic about this)? Be ruthless, if a candidate doesn’t meet the criteria, don’t hire them.
Make it a Team Decision
Yes, getting consensus is difficult, but definitely getting the approval of the team in the majority gives you a better indication of whether or not they will adopt the decision you make. Change Management methodologies have found that where those impacted by the decision are not involved, 80% of the time the project or change will fail. However, where those impacted are involved and contribute towards the decision, 80% of the time the project or change will be successful because it will be adopted more readily.
Pay attention to when you start to compromise on your criteria for making a decision
You’ve set the standards in your self-defined process or formula, now live by them! In your personal life, for example, don’t start to compromise on your budget because the more expensive one that’s out of your price range has grabbed you by the heart and you’re in love with it. You can’t afford it. In your professional life, for example, don’t allow your mind to be manipulated by others who have framed their offering just right.
TEST your intuition by going against it, every once in a while
“Going with your gut” seems logical, and the evidence shows that we defend gut decisions more readily than those that are made on logic alone. But is your gut feel actually any good? Test it, by going against it. You will surprise yourself by seeing that the person you hired that didn’t seem like a great “culture fit” is actually a brilliantly skilled team member who’s starting to make good friendships on the team. How else will your intuition get honed if you don’t give it a sense of what really *is* wrong and what really is right?
Recognise where you need to make tradeoffs
Draw up a Tradeoff Triangle and stick it on your desk. In one corner, write “Price/Cost”; in another corner, write “Quality”; in the last corner write “Speed/Time”. You can only ever have two of these at the same time. For example, if you want something that’s high quality and quick, prepare to pay a high price for it. If you want something that’s low-cost and high quality, it will take a long time. Low cost and quick? Well, it won’t be great quality. Internalise this, and recognise where you need to make a tradeoff. Don’t feel hard done by when your available options don’t have all three. Know which factor you can afford to live with (Quality, Speed, Price).
Got the decision wrong? CHANGE YOUR MIND and take a different course of action.
Part of the problem with poor decision-making is that we defend our decisions for too long and continue to invest in a lost cause. Don’t get caught up in the Sunk Cost Fallacy. Pouring good money after bad will never help anyone. Facebook’s motto is “Fail fast and break things” – in other words, experiment, get things wrong so that you eventually get things right. It’s all part of creating and implementing a flawless hiring strategy.
Practising all of these steps will help you build a strong skill and perfect your ability to make the right decisions for you and your team. To learn more about the art of developing great instinct- see our Hiring Manager & Interview Training!