Decision-making: 4 practical tips from cutting edge research
As leaders you will face many decisions. The nature of your role means that the decisions you are facing will be significant. Is it enough to say, as many leaders do: “I made the best decision I could in the circumstances”? How much should you trust your gut? And how often do you use a proper framework to make (and then take) those decisions?
There is a huge amount of brilliant research and insight around decision-making, from Daniel Kahneman’s acclaimed ‘Thinking, Fast and Slow’ through to numerous practical guides and frameworks. There are some simple rules and pieces of insight that can be extracted, to help you navigate your decisions, big and small.
No. 1 Work out What Problem You Are Trying To Solve
Before you start the process of decision-making, you need to establish what problem you are trying to solve. This sounds much, much easier than it often is. The best way to think of it is like the peeling of an onion: once you have defined your problem, keep asking yourself ‘so what’ questions to ensure you get to the nub.
No. 2 Should You Trust Your Gut?
This is a question I get asked a lot. And the answer is Yes and No.
Yes
If:
you are really experienced in your environment, and the environment is relatively stable;
it’s a decision you have faced many times before;
feedback has been rapid and clear on your previous decisions;
then going with your gut can be a good option.
Decisions where your Values come into play can also be driven successfully by your gut feel, making sure you do the thing which sits best with you.
Finally, psychologists use the term ‘cognitive misers’ to explain the fact that we tend to be quite lazy in our thinking. We have a series of rules of thumb (known as heuristics) - mental shortcuts that allow us to make quick, intuitive decisions. Whilst this doesn’t always translate into the optimal decision, they do allow us most of the time to avoid making really risky or catastrophic choices. One example of this is social proofing - essentially copying the actions of others.
No
HOWEVER, we are also subject to a whole host of cognitive biases, which can influence our thinking without us even realising. Just knowing about these isn’t good enough. Just like knowing that you are short-sighted isn’t enough to make you see better. You have to make a conscious effort to do something about it. This means using an active and effortful decision-making process, rather than just making a quick decision based on instinct or gut feel.
There is also a danger when experts make judgements based on gut feel (exacerbated by something called the Confidence Bias) when in fact the environment has changed dramatically. Something that is of course particularly relevant at this time……If as a leader you find yourself doubting your intuition at this time, this is a good thing!
No. 3 How Can I Avoid My Emotions Impacting My Decision?
This is a real problem for most people, even if you think you are good at this. When our emotions rise and take over, our neural activity shifts away from our pre-frontal cortex - responsible for executive planning and control - to a part referred to as the amygdala. This makes us less able to make calm and rational decisions. So when you think this is happening, step away. Give yourself time. Acknowledge and label your emotions. Think about what advice you would give to someone else in this situation (which helps bring objectivity and perspective). And challenge yourself on any assumptions you are making about the situation and individuals involved.
No. 4 It’s A Really Key Decision - What Should I Be Considering?
Most leaders build up their own decision-making framework over time, but key areas include:
spend proper time at the beginning clarifying the problem you are trying to solve, and the decision you have to make;
see if you can define your objective - what it is you are trying to achieve with this decision;
try and ensure you have lots of options on the table, rather than just A and B (research shows this makes your decision-making more effective);
collect as much data as you can to reality test any assumptions you are making and try and neutralise any biases (this should include conversations as well as machine-based data*);
*don’t assume that Artificial Intelligence (AI) is the answer to everything. Humans are still relevant to the AI process, both in terms of deciding what data is captured (and how) and in terms of setting algorithms. There is also an increasing amount of evidence that algorithms encode hidden biases.
be clear on who you should be involving in your decision-making process, and in what capacity. What is your leadership team’s role in this process? Are they just a sounding board or are you trying to build a consensus? Who do you need to consult as part of the process? And who do you need to ‘bring with you’?
be clear on the time-frame;
prepare to be wrong - once you are leaning towards a particular decision, do some scenario planning/hold a pre-mortem, examining best and worst case and anything appropriate in between;
once you have taken the decision, think carefully about how you will communicate this, and in particular what your strategy will be - for example, will you try and use key influencers to help the decision land and be accepted;
make sure you build in a review process, to check the efficacy of your decision-making process and learn for the future.
Decision-making is fundamental to the role of leader. These four points provide a short cut through some of the key thinking and research, and should help you make and take better decisions.
I’ll end with one of my favourite quotes on this area, from Simon Sinek:
“There is no decision that we can make that doesn’t come with some sort of balance or sacrifice.”