Being a good decision-maker does NOT mean good decisions are being made.
CEOs are typically strong decision-makers – how else would they have risen to the top? But being a good decision-maker does NOT mean good decisions are being made.
By questioning whether good decisions are being made, I’m not saying CEOs are failing. I AM saying the decision-making process may be failing – but let’s understand what I mean by “decision-making process.”
Mention “decision” and most folks envision an event, that point of no return of choosing one course of action from two or more options. In reality, that event is but one action within the larger sphere of the decision.
In the world of management, a decision is a process – a process that begins at the moment a problem or opportunity is identified and ends with an evaluation of the success or failure of the course of action selected.
Every decision entails:
1. Framing the question
2. Generating options
3. Evaluating each option’s merits and risks
4. Selecting the best solution
5. Reviewing and learning from decisions
So in most organizations, where does the CEO typically fit into those big strategic decisions? That would be at number four: Selecting. Most everything else is usually delegated down to project teams. Project teams do the research and analysis, then deliver their recommendations to the CEO.
Clearly much of the decision (and its quality) is delegated out of the CEO’s hands. Every CEO relies on his or her team to apply the best decision techniques.
Unfortunately, few teams are truly equipped to execute all these other decision activities. Reality Check: When were your people trained in the best practices for re-framing questions, avoiding common biases, and delivering effective follow-up that improves future decisions?
Without decision training and a reliable process, teams rely on instincts that are rife with shortcuts, biases and other missteps. They miss better solutions – wasting capital and squandering opportunities – but that error is virtually undetectable late in the process. Review and approval meetings are the wrong forums to arrest the most common errors.
Without decision training and a reliable process, CEOs receive inadequate information. Absent good information, the best decision-maker is left fighting with one hand tied behind their back.
Every major project team needs at least one person with the skills and status to ensure you’re getting the high quality information you deserve. So… who is that person?