Saturday, September 6, 2014

A630.4.4.RB- How Companies Can Make Better Decisions



Indecision… Yes, No, Maybe… Undecided it is, then. Indecision is the inability to make a decision quickly. I am riddled with indecision right now, stuck frozen in a perpetual standstill while life is whizzing right past me. What is there to say about making decisions?  It can be hard to make better decisions or any decision at all. I would like to say something really clever about the topic, but nope, I am sitting here at a loss and it is just me trying to decide something on my own and believe me, it is difficult enough. Add a second person into the equation and then pose the question: What we should have for dinner?  Forget about it, you could end up starving and hangry, or also known as angry from hunger. Let’s add on to this and get a group together and try to make a decision about what to do or where to go.  Two heads are better than one? Perhaps, unless you just do not have a meeting of the minds …then say hello to chaos.

This seems to be the fuel to most Fox News or CNN newscasts, the Republicans and Democrats cannot reach a consensus, no one thinks anyone does anything right. One side knows exactly what should be done, but the other is not listening and vice versa. This bleeds into elections when it is time to vote for city, county, district, state or national representatives. Ask a large group of people to decide on anything and there is so much perturbation that maybe nothing effective will ever happen. Now think about an organization trying to make decisions, or even your organization trying to decide what to do and how to do it. If the answer is, let’s do it the way it has always been done, I cry no! That is a dagger right to the heart of that organization.

 I think this should be the true mark to tell if an organization is effective or not, ask how good someone’s company is at decision making. If it is met with a scoff and an eye roll that organization is very well heading toward peril. If you say your organization is easy, breezy and doing fine, keep reading anyway, you probably can do even better. But don’t take my word on this; I am sitting in my pajamas because I couldn’t decide what to wear today. My Britney Spears t-shirt says hi. I found a great video from Harvard Business Review that asks the leader of Bain & Company’s Global Organization Practice how to put effective decision making at the center of your business.

Marcia Blenko details why decision effectiveness has a positive correlation with employee engagement, the impediments of good decision making, the four elements of good decision making and provides insight on the five steps to breakthrough performance in your organization from a book she co-wrote Decide and Deliver. She explains why the key driver of performance of an organization is decisions. The decision capability allows an organization to “cut through efforts while making an impact on the organization at the end of the day.” (Better Decisions, 2010) Companies will operate better, have a better metabolism and see better financial performance in result of decision capabilities. (Better Decisions, 2010)

To highlight the importance of employee engagement and the correlation of how decision making relate lets examine a hypothetical scenario. Take a single task and two employees with different departments and add the situational ingredients. The task is paper doll cutting. For Employee A the tools are provided, the instructions rendered, a work space is designated undivided from distraction. For Employee B the task is given, but they have to get permission to get scissors and are required to go multiple places to procure this tool. In addition another department will give the instructions, but Employee B needs to wait until that department is back from lunch. Once the instructions are obtained, unfortunately the work space has been reserved for another department and will have to wait until that meeting is concluded. Which employee will make better paper dolls? Employee A is happy and made precise, gorgeous model paper dolls. The few that Employee B made that was spared by the frustrated paper scrap massacre of 2014 are less than ideal. Happy people will do better, more consistent work. Blenko points out that the easier it is for decisions to be made, the more stimulating the work will be. I believe if it is harder for decisions to be made it forces the organization to work an uphill battle. If employees felt that they have the talent and capability to do great work but constantly got a stop sign but knew of another organization that gave the green light and made using their talent possible, what would stop someone from saying bon voyage and hang on to that organization?

Clearly having a successful organization is the goal or else why would anyone start a company in the first place? Since decisions play a large part in how well the machine is oiled, why isn’t it easier for good decisions that are effective to be made? According to Blenko there are four elements to good decision making: quality, speed, yield and effort. Quality is defined by making a good decision. So, it is not just making a decision, but a worthwhile choice. Speed is how quickly the decision can be implemented once it is made. If there is a hot trend that hits the internet, how quickly can your company realize the potential and beat the competition to carrying it out, this could be the determining factor of which organization can pull ahead? Yield is just as important, you made a great decision and acted fast, but did it turn out as you intended? Execution can make or break the decision. Rounding out the four elements is effort. Blenko likens this to Goldilocks. Is it too little, too much or just right? When it comes to cost and energy you better not put in too much cost and too little energy or the organizational ship may spring a leak and start sinking. I started to think how little four elements are and if there was anything missing from it. I feel like everything ties back to being a sub point to the main four. What if you have a bad idea?  Poor ideas tie back to the element of quality. The same can be true to your organization’s perception of the market not being accurate. In my opinion the elements flow from one to the other in a logical, linear fashion.

The true problem of how companies can make better decisions is the fact that there are impediments. Blenko points out that most organizational structures have become so complex that you cannot simply look at a work chart and distinguish who make the decisions. It does not matter if you have a great idea at the right time, if you cannot get it in front of the decision maker it will simply remain a great idea at the right time, a what could have been moment. I think other factors that I have dealt with in the work place are control issues. I have seen a single decision maker who did not allow outside influence and it was my way or the highway. I have also seen too many people involved that felt that they should be making the decisions their selves, on their own. Let go of the control, there is no one best way so let all ideas be heard. Fear and uncertainty impeded a quality decision executed properly with speed. I really feel it boils down to culture because culture touches all things inside of an organization. Blenko gives an account of multiple issues that clog up the elements of good decision making such as leadership behaviors. It is important to allow for constructive debate before and not after a decision is made. Sometimes it is not clear who makes the decisions or who should be involved. Also, there may not be the right talent in the decision roles (Better Decisions, 2010). Another insightful detail is that the obvious big strategy decisions are not the only decisions the organization needs to get right, but also the daily operational decisions that add up over time.

To sum up how companies can make better decisions Blenko quickly touched upon the five steps process from her book. The first is that a company needs to understand how well you are doing with decision making. Once you understand your challenges then you can work to correct them. The second step is to identify what the critical decisions are and what matters most. Next, set the decision up for success with the what, who, how and when. She says this frames us what the decision is, who is involved, how will it be carried out and to mark on the calendar when this is taking place. Her fourth point is making sure the organization supports the decision once it is in place. This reminds me of buying a heavy work of art and putting it on a table that is too weak and the legs give out. The culture, talent, technical systems need to be able to hold up this decision. Lastly and maybe most importantly, the decision needs to be embedded throughout the entire organization. Instead of putting a big heavy decision on a table to hold up, it is really putting it on the shoulders of those in the organization. If everyone is not holding it up, it may slip through the holes and fall down.

I have often wondered why some of the places I have worked have been so frustrating and I just could not put my finger on what was wrong, but I suspected something was amiss. Examining the culture of an organization and the decision making process this week was like turning on a bright neon sign pointing to the flaws. I was experiencing without seeing or understanding and I am only seeing it as it is for the first time right now. I loved Blenko’s interview with the Harvard Business Review because the ease of the delivery made me go, ah ha!

I think there is immediate take away of the four elements in my personal life particularly that I could apply to making the decision of when to sell my house. Quality, speed, yield and effort works with when to hit the housing market just as it would with working with my students as an academic advisor.  We have goals of being able to provide enrollment opportunities to our students each term. A course is only as good as those who benefit from it. If I do not afford the opportunity to my students to enroll, then the mission of the University, providing education is not being gained by those not in classes, at least in a formal sense. I need to make quality decisions for my students, but also since there is just one of me and four hundred and fifty students, how quickly I can provide my advisement is crucial. If I reach you a month before the term or a week before the term, that changes the chance of that student being ready to decide on a nine week commitment. Sometimes I have great intentions for an outreach, but if it doesn’t turn out how I planned, that changes the effectiveness. The same goes for my energy and the amount of time I can afford to put into my efforts. My effort has to be the right amount of “enough” or the other three elements will not be able to align and the decision won’t turn out to be good. The most significant part for me is taking something as common as decision making, which we do all day essentially, breaking it down in terms of a simple recipe and then practicing applying it to situations to see things be put together or break apart.

Reference: How Companies Can Make Better Decisions, Faster - YouTube. (2010) Retrieved September 6, 2014, from http://www.youtube.com/watch?v=pbxpg6D4Hk8&feature=player_embedded

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