SOUND DECISION-MAKING
REQUIRES AUTHORITY AND
WILLINGNESS TO TAKE RISKS



When decision-making gets particularly tough, you may wish that someone else could make the difficult calls for you. But when you are comfortable with three important aspects of the process, you can move ahead comfortably: (1) know you have the authority to make the decision, (2) know that your decisions are ethical and (3) know that you've gone through all seven steps in the process. These three phases have become so ingrained in managers who routinely make sound decisions that they don't even consciously think about them.

First, Find Out
How Much Authority You Have
To Make Decisions

Corporate culture will definitely impact how, when or even if you make business decisions. In some organizations, decision-making is a centralized process – the broader the impact of the decision, the more likely it will be reserved for a department head or even a senior manager. In other organizations, line managers are empowered to make most of the decisions that directly impact them, usually limited only if the dollar amount involved in the decision is substantial. How far does your decision-making authority extend? Ask your boss!

And don't forget to take into account your decision-making style based on your personality type. You may need to adapt your style to effectively lead a group decision-making process.

Ethical Decision-Making

Every decision a manager makes starts not with a particular process but with a manager’s choice to base his or her decisions on ethical principles. I would coach you to visit the Josephson Institute of Ethics’ website for a review of the ethics involved in making decisions.(opens new window).

At the core of ethical decision-making is the acceptance of two principles:

  • We all have the power to decide what we do and what we say, and
  • We are morally responsible for the consequences of our choices.

You need to adopt six core values (opens new window) as your ethical decision-making litmus test:

  • Trustworthiness – be honest, reliable, loyal and have the courage to do the right thing.
  • Respect – follow the Golden Rule, be tolerant, considerate and deal peacefully with disagreements.
  • Responsibility – persevere, do your best, use self-control, self-discipline and be accountable for your choices.
  • Fairness – be kind, open-minded and don’t take advantage of or blame others.
  • Caring – be kind, compassionate, express gratitude and forgiveness, help others.
  • Citizenship – cooperate, get involved in community affairs, stay informed, obey laws, respect authority and protect the environment.

“We may not have the power to do everything we want to do, but we still have the power to decide what to do with what we have. And that is power enough”!

A Seven-Step Business
Decision-Making Model

Decision-making is the process leading to the selection of a course of action among available alternatives. There are multiple models, all with unique plusses and minuses, and rather than taking the time to find your favorite right now, I would coach you to adopt a straight-forward, model for making decisions. The seven steps include:

  • Clearly identify the objective

  • Brainstorm alternative ways to reach the objective

  • Compare how well each alternative satisfies the objective

  • Select the best alternative

  • Test the selected alternative

  • Make and implement the decision

  • Review the outcome

If your job requires you to use a more sophisticated decision-making process as part of your routine responsibilities, I would coach you to visit Decision-Making-Confidence (opens new window) for a comprehensive look at a dozen decision-making models, including:

  • Kepnor Tregoe (my personal preference for years!)

  • Six Thinking Hats (Edward DeBono’s approach exploring a variety of perspectives and emotions)

  • SWOT (an analysis of strengths, weaknesses, opportunities and threats)

  • PEST (a politics, economics, social and technology analysis)
  • Carnegie Decision Model (emphasizing the political process involved in decision making)

  • Porter’s Five Forces (analyzes industries and competition)

Occam’s Razor

Probably because I was a Philosophy major in college, I have always been partial to this principle: “All things being equal, the simplest solution tends to be the best one” - because it introduces the fewest assumptions. I’ve found it particularly valuable when a quick decision is called for.

During the early years of your management career, you may hesitate to implement the solution, no matter how conscientiously you followed the process. Apply the Occam’s Razor principle. It can help sharpen your focus and reinforce your choice.

Beware of “Groupthink”
and The Road to Abilene

Groupthink is a mode of thinking that happens when members of a group or team strive for unanimity at the expense of realistically considering alternative courses of action, according to Irving Janis.

So, while it’s wonderful for a team to be cohesive and agree most of the time, you need to suspend unanimity while making decisions.

The classic example of groupthink is The Road To Abilene – used in most management training programs to mitigate against groupthink.

Risk-Taking is Involved
In Every Decision You Make
(Professional and Personal)

Risk taking involves letting go your comfort level - what you know - to reach for something you are not entirely sure of. The risk is worthwhile because you believe it will result in something better than what currently exists.

According to Dr. Sandra Hagevik in Denver, there are risk-taking guidelines that, if you follow them, will make the outcomes of your risks more predictable and less of a gamble.

Are you a risk-taker? Take this test to determine your comfort level with risk taking (opens new window). If your natural personality type or management style is risk averse, use Dr. Hagevik’s guidelines to help you become more comfortable with the risks you have to take as part of the decision-making process.

Never Look Back
and Wonder “What If”

I once asked the Dean of the School of Business at Syracuse University, who was a also retired Naval officer: “What’s the worst decision you’ve ever made”? His response was nothing short of startling: “I’ve never made a bad decision”. He went on to explain that once he made a decision, he never looked back. That way he couldn’t second-guess or regret a decision once he had made it.

I’m not sure I totally agree with his line of reasoning and as a first time woman manager, you probably won’t have that luxury anyhow. You can always learn from your decisions and how you made them.


Return to HOMEPAGE from DECISION MAKING

Proceed to CORPORATE CULTURE

Proceed to PERSONALITY TYPE

Proceed to DECISION-MAKING MODEL

Proceed to GROUPTHINK

Proceed to RISK-TAKING GUIDELINES