What Are Your Top Decision-Making Questions?
When your employees are faced with challenging business decisions—whether to launch a new product, whether to enter a partnership with another company—do you have a protocol you teach to make sure they’ve thought through all of their options?
Leadership development is a part of most companies with formal training programs, so I was wondering what teachings you offer in decision-making? Elon Musk, the entrepreneur who launched companies such as PayPal, Solar City, SpaceX, and Tesla, has six essential questions he asks himself, according to Business Insider.
He says the first thing to do is ask a question. For me, that would be a question such as: “Why might I want to say, ‘Yes’ to this decision? What are the consequences of saying, ‘Yes’? How much will it mean in needed financial expenditures, how much will be needed in staff resources? What is the potential upshot?”
I then would ask the exact same questions about saying, “No.”
The important point would be not relying on group think. As an introvert who likes to work independently, I’m biased against making decisions based on group consensus. But even if you’re an extrovert who likes to ask a dozen people for their opinion before making even the most minor decisions, you have to ask yourself whether your likely decision is being affected by group hysteria or group assumption. You want to make sure, for instance, that you’re not being impacted by group prejudice or stereotyping. Why might your group be opposed to working with a particular company? Is there any chance the race, gender, or background, of the company’s owner, or key executives, could play a role? Is your group’s collective average age a factor that could weigh against a smart decision? For example, if there is a new app to more easily view and buy your products that could be built, but it will be costly with potential great gain, why is your group opposed? Could it be because they aren’t as attuned to mobile technology as the majority of people you want to sell to?
Musk also advises gathering as much information as possible before making a decision. Who do your leaders have in their close circle of employees to reliably help gather data—people who are going to fairly gather the data, rather than only gather the data that supports the way they are leaning on the decision? Everyone has biases, but some people are more nuanced, deeper thinkers, who are better able to consider both sides of decisions. In addition to a mix of genders, races, and backgrounds, you would want at least a few people on every leader’s team with that kind of mindset. Is there any role among the decision-making advisors for people who are advocates by nature? It might be helpful to have one person on each side of a decision, who are passionate about their side, and who you know are going to dig deep to find information to support their position. You know in advance that they have a strong perspective, so you hopefully will be able to filter the information they give you through knowledge of their perspective, while examining the points they make. Their points could be the same points your customers will make to you if you make the opposing decision. They also can help you anticipate the backlash that might occur within your own company.
Musk says it’s also important to determine the likelihood of the events, or results, occurring if you make one decision or another. I’m not a mathematical person, but I was forced to take something called “statistics for the social sciences” in graduate school (statistics for the math illiterate), where I learned in a shallow way about confidence intervals. As I understand it, these confidence intervals give you a sense of how likely an event, or outcome, is to occur. I wouldn’t know how to do it myself, but it could be helpful to have a numbers-oriented, quantitative thinker on every leader’s team. That means that, in addition to the mix of gender, race, background, personalities, and perspectives, you would want a mix of qualitative and quantitative thinkers. The numbers aren’t the whole story, but I learned that numbers can be assigned to almost anything to conduct a study or evaluation. It can give you a sense of what you might be missing with your emotions or biases. The place to be careful is to make sure you aren’t solely relying on the numerical analysis, and that you are thinking through the decision. You don’t want to turn decision-making into a paint-by-numbers process where you go on auto-pilot, awaiting whatever the number say, as if the numbers were a magical oracle that could tell you the future.
Once you make your decision, Musk says to pause before finalizing it, and try to oppose your conclusion. You could at that point bring in your advocate for the opposing side, and debate him or her, with the rest of the team listening and acting as a jury. Ultimately, it’s the leader’s decision, but it’s good to have a sense of where the whole team stands after hearing both sides of the issue. When you take the time, and devote the thought, to making a decision, you can feel good about taking ownership of the outcome—even if the outcome wasn’t exactly what you had hoped for.
Do you teach a decision-making process in your leadership development programs? How do you prepare leaders to make informed decisions with the support of diverse teams?