Making the best possible decisions

By Dr. Bob Rausch

May 10, 2005

Decision-making is an important activity for business owners and leaders. It also can be a source of frustration for both the decision-makers and those affected by the decisions.

Although as a leader or manager you always might not show your worry or concern when making decisions, many of you spend considerable energy wondering if your decisions will have a positive effect on people and profit. On the other hand, I hear countless complaints from employees about management decisions. The complaints generally are followed by the statement, "We do the work, and not one of them bothers to come down here to find out what's going on. We have the realinformation."

Regrettably, many of you make business decisions in a vacuum without acquiring very important information from others. However, some of you take specific steps that allow you to make the best possible decisions. Not only do you choose to follow sound decision-making guidelines, but you also recognize the culprits that interfere with good decision-making.

Thinking and Feeling

Human beings use two distinct activities when making decisions—thinking and feeling. When thinking is clouded, emotions are clouded, and less-than-effective decisions result. When your emotions drive the thinking, the decision always is detrimental to you and to those whom the decision affects.

When your thinking is clear—which means you also have all of the information you need to make an intelligent decision—and your emotions are based on what's best for the team and company, your decisions are much more likely to be right on target.

A Bad Decision Waiting to Happen

Let's look at an example of a manager who had clouded thinking and negative emotions—two key ingredients of a bad decision.

I was asked to work with a team that literally could not communicate with its boss. He was an overbearing, critical micromanager. He refused to let any information leave the department without his going over every little detail. His management style created an unhappy team who had little respect for him. As a result, the team members wasted much energy having sidebar conversations about him and finding excuses to stay out of his way.

As you might guess, this team's trust was nonexistent. The general consensus was that if their manager didn't trust them and was going to criticize everything they did, why expend much energy for him? After many months under this manager's leadership, the team was so beaten down that communication grinded to a halt, and decisions made within this department suffered.

I was asked to become involved because the department's performance was negatively affecting other departments within the company. When I had my initial meeting with the manager, he let me know that he didn't need "some consultant telling me what to do" and felt this was a waste of his time. However, since his boss wanted the team-building, he would go along with it. During that meeting, he finally decided that having an objective perspective couldn't hurt, and it might even straighten out his people.

During the second one-on-one meeting with the manager, he made a statement that gave me a clue about what really was going on with this team. He said that when he first took over the department, hisboss told him how worthless the people were, and that he might consider cleaning house and starting from scratch. This inappropriate briefing caused the manager to perceive his team as incompetent immediately. He mistrusted the employees' abilities and compulsively checked their work. This negative perception and resulting behavior also set the stage for a great deal of frustration and anger.

This situation has two obvious problems. The first is the monumental error in judgment by the manager's boss. Denigrating the employees only served to cloud the manager's thinking and to create negative emotions about the team.

The second problem is that the manager did not have enough self-confidence to ignore his boss's inappropriate comments and decide for himself. Because he didn't think for himself, he became susceptible to his boss's prejudice and authoritarianism. Prejudice, susceptibility, and authoritarianism are decision-making transgressions that can cloud both thinking and feeling and lead to poor decisions.

Prejudice

Prejudice is defined as a prejudgment or mental bias that can cause you to ignore, minimize, or overestimate evidence. Prejudice always inhibits clear thinking and produces negative emotions. Even after you gather all the evidence, your prejudices will make it difficult to draw accurate conclusions, because prejudice rests on emotional grounds.

In the example, the boss set the stage for the manager's prejudice. Because he readily accepted his boss's assessment, the manager immediately expected and began looking for mistakes from his team—possibly ignoring any positives along the way and overestimating the significance of even the smallest mistake. The more he looked, the more mistakes he found, which confirmed the boss's opinion.

Susceptibility

The second transgression detrimental to decision-making is susceptibility to biased information. Obtaining information from the same one or two sources only is much too limiting. In some companies, the decision-maker has favoritesthat he or she always consults when making decisions. This pattern can leave you susceptible to faulty or biased data. Some employees may tell you what you want to hear for fear of disapproval or retaliation. Some withhold information altogether for fear of retaliation. This is what I call "cooking the communication books,"—a practice that leaves the entire organization vulnerable to poor decisions. Susceptibility to false, tainted, biased, or incomplete information can be dealt with by soliciting feedback from various individuals who have a vested interest in the decision's outcome and the knowledge that can help you make an informed decision.

Authoritarianism

The final transgression that leads to poor decision-making is authoritarianism—the uncritical or blind acceptance of authority and the refusal to gather accurate information. In an authoritarian culture, people blindly accept that all knowledge from the authority is guaranteed to be right, because it's validated by the leader. This blind acceptance of authority is suggestive of the emperor and his new clothes. No one wanted to tell the emperor that he was naked for fear of retaliation. When people unconditionally accept authority, they surrender their independent knowledge of what is right and wrong, true and false. Blind acceptance halts all investigation for accurate information, results in poor decisions, and impedes progress.

The Seven Principles of Good Decision-Making

Following specific guidelines can help you make the best decisions for you, your team, and your company.

• Collect all the information necessary from a variety of sources.Let people know that everyone has skin in the game and can provide input.
• Have the right attitudes about the people with whom you work. When coworkers know that you believe in their abilities and judgment, enterprise energy increases dramatically. Your attitude about people makes all the difference.
• Be careful of being influenced by people who tell you what you want to hear. Influence is a wonderful thing, in its proper context. If an employee is always agreeing with you, it might be a sign that he or she only tells you what you want to hear. Some of the best information will come from people who aren't afraid to disagree with you.
• Separate emotions from fact. Look at the goal you want to achieve, and collect information that will lead you to that goal. Stick to the facts!
• Give people the facts, and ask for facts. No one does the company any good if the facts, as you see them, are not presented. Sometimes it's risky to give facts, but not giving them is even riskier.
• Collect as much information as possible from a variety of sources, but don't get hung up on details. Focus on the real need and objective. Spenser Johnson said, "When I pursue only the real need, I am more decisive, and I make better decisions sooner."
• Have courage in the decisions you make. Peter Drucker said, "Wherever you see a successful business, someone once made a courageous decision." There are no terminal decisions; you always can go back and correct the course if necessary. Courage is an energy that increases personal confidence and the confidence others have in you.
• Make decisions that benefit the company overall. Be careful not to make decisions that affect your department only. Each department is a part of the whole. Keep in mind what your decision will do to other departments. One of my clients coined a very insightful phrase, "Don't make your urgencies our emergencies." All decisions must benefit the entire company.

A final word on decision-making comes from Theodore Roosevelt: "In any moment of decision, the best thing you can do is the right thing, the next best thing is the wrong thing, and the worst thing you can do is nothing."