Three Ways Leaders Can Improve Decision Making
“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.” Theodore Roosevelt
Leaders today are suffering from inattention blindness – the inability to be present and see the wood from the trees. Deluged by data, leaders should have more information than ever to enable better decision making. Yet ironically the opposite is happening and the situation is only likely to get worse.
Today, the New York Weekly Times edition contains more information than the average person in the seventeenth century came across in their entire lifetime. In 2008, we consumed three times as much information as in 1960, and by 2020 it is estimated that we will be generating 44 times more data than we are producing today. This data avalanche brings opportunities for leaders to interrogate multiple sources of data. However, when there are so many disparate data sources, often supplying conflicting information, which data source do you believe?
Here are three ways leaders can help themselves to make better decisions, and stop being overcome by inattention blindness:
Don’t Get Attached To Past Results
When leaders get attached to past results it can inhibit their ability to think clearly and assess present challenges with an open mind. With the only constant in business being change, if a leader is not open to exploring new ideas it can literally spell the demise of the company.
A great example is the Finnish communications giant Nokia. In 2007, the company had a market cap of USD303 billion and manufactured four in ten of every mobile phone purchased. However, within five years the company lost 90% of its market share to Apple after the launch of the iPhone. The little-known fact is that Nokia had invested USD40 billion into creating a similar style iPhone device with color touchscreens, maps and shopping but the product never hit the shelves as management thought it would not have mass market appeal. How wrong they were.
Slow Down To Speed Up
With leaders making up to 10,000 decision every day, there is a real case for slowing down to speed up. Since many of these decisions are trivial there is always the danger that the consequences are not fully evaluated. However, over time many of these trivial decisions can magnify to have a great impact on the profit and people in your business.
Time pressure encourages tunnel or distorted vision, whilst the best ideas often emerge after a reflective pause. Something well understood by former US President Barack Obama who reportedly advised then UK Prime Minister David Cameron that “The most important thing you need to do is to have big chunks of time during the day when all you’re doing is thinking. Without that, you lose the big picture”.
Give Authority To Those Closest To The Information
If leaders are going to enable better decision making they need to give authority to those closest to the information. This is what Nobel Prize Winning Economist, Fredrich Hayek, described as “local” knowledge. Leaders need to empower team members to make real-time decisions and then take corrective action, knowing that their decision will be supported. However, the challenge is that many our business structures do not empower team members to make decisions.
Combine this with the fact that less than 13% of team members across the world are fully engaged at work, many employees simply don’t want to make decisions and would rather abdicate the decision-making responsibility to others. That’s why a key role of the leader is to enable the business to have a pro-active and inspiring culture, where everyone wants to be involved because they are driven by an aligned purpose.
When the purpose is clear, team members can feel empowered to step up as they have a framework for decision making, since anything that does not serve the company purpose and values is out of alignment. This enables bolder, quicker and better decision making, which in turn leads to improved performance – both financially and otherwise.