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Effective Decision-Making Strategies for Emerging Leaders

Explore rational choice decision model, systematic approach, autocratic vs. collective decision-making, and decision-making tools to enhance organizational effectiveness. Learn challenges and successful strategies in decision-making processes.

josephbernard
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Effective Decision-Making Strategies for Emerging Leaders

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  1. Emerging Leaders Program Module 4: Building Your Organization www.cheurfire.com

  2. Objectives • Understand the Rational Choice Decision Model and its fallacies • Learn about the Systematic Approach to Decision Making • Compare and contrast autocratic vs. collective decision making • Explore a variety of decision making models/tools cheurfire.com

  3. Better Decision Making cheurfire.com

  4. Rational Choice Decision Model cheurfire.com

  5. Rational Decision Making Model • Assumes decision maker has… • Complete knowledge of situation • Knowledge of all of the alternative solutions • Objectivity • Goal of maximizing economic gain cheurfire.com

  6. Rational Decision Making? • We tend to believe the following: • Goals are clear, compatible and agreed upon • People can process all information equally • Choices are evaluated simultaneously • People evaluate against absolute standards • Information is factual • People try to select the best alternative cheurfire.com

  7. Decision Making Challenges • However, in reality • Goals are ambiguous, conflicting, not agreed upon • People have limited information processing capacity • Limited search for alternatives and their outcomes • Tend to evaluate a limited number of alternatives • Choices evaluated sequentially • People evaluate against implicit favourite • Information is perceptually distorted • Satisficing: people try to select a “good enough” alternative cheurfire.com

  8. In fact... • Studies1 show most managers • have prior beliefs that guide decision making • treat problems like they are unique (ignoring rational outcome probabilities) • overestimate their level of control throughout • act before all information is gathered • have a high tolerance for ambiguity, misinformation, and lack of information • use either complex or quick, autocratic processes • rely heavily on intuition 1 Korte, Russell. “Biases in Decision Making and Implications in Human Resource Development.” Advances in Human Resources Development. November 2003 cheurfire.com

  9. Unsuccessful Strategy: Idea Imposition Process • Urgency to act pushes decision makers to settle on an idea too early • Most effort is spent defending the chosen idea rather than evaluating a range of possible ideas cheurfire.com

  10. Successful Strategy: Discovery Process • Deliberate and thorough study of the claims made by a variety of stakeholders • Early attention to social and political interests • Setting a direction based on a cross-section of informed opinion cheurfire.com

  11. Systematic Approach to Decision Making* *Mindtools Inc. cheurfire.com

  12. Systematic Approach to Decision Making1 Step 1: Create a constructive environment - Establish the objective - Agree on the process - Involve the right people - Allow opinions to be heard - Ask the right questions 1Mindtools cheurfire.com

  13. Establish the Objective • Define what you want to achieve • Vroom-Yetton-Jago Model Agree on the Process cheurfire.com

  14. Vroom-Yetton-Jago Decision Model Autocratic Participative cheurfire.com

  15. Autocratic Leadership When should you opt for this style? • You have more subject expertise than others • You are confident to act alone • The team will accept your decision • There is little time available cheurfire.com

  16. Collaborative/Participative Leadership When should you opt for this style? • Information is needed from others • Problem isn’t clear • Team buy-in is important • Luxury of time cheurfire.com

  17. Involve the Right People Conduct a Stakeholder Analysis Power Interest cheurfire.com

  18. Allow Opinions to be Heard • Be aware of Groupthink • Get everyone’s ideas and input • E.g. Stepladder technique • Present task or problem to all members before assembling • Form a core group of two member to discuss problem • Add third member to group and allow them to present ideas before hearing previous solutions. Discuss all solutions. • Repeat the same with fourth member and on and on. cheurfire.com

  19. Allow Opinions to be Heard • Reframe opinions to be parallel • Six Thinking Hats • Traditional vs. Parallel thinking • Involve six different coloured hats • Wear only one hat a time cheurfire.com

  20. Six Thinking Hats cheurfire.com

  21. Ask the Right Questions • 5 Whys Method (aka The Preschooler Method) • Start at the end result and work backward (toward the root cause) by continually asking “Why?” • Root Cause Analysis • Cause and Effect Analysis cheurfire.com

  22. Step 2: Generate Good Alternatives • Generating Ideas • Considering different perspectives • Organizing Ideas cheurfire.com

  23. Step 3: Explore the Alternatives • Risk • Identify and determine whether risks are manageable • Implications • Consider consequences of each • Validation • Determine available resources, match with objectives and long-term viability cheurfire.com

  24. Step 4: Choose the Best Alternative • Example Tools: • Grid Analysis • Paired Comparison Analysis • Decision Trees cheurfire.com

  25. Grid Analysis cheurfire.com

  26. Grid Analysis cheurfire.com

  27. Step 5: Check Your Decision • Conduct a ‘sense check’ • Test your assumptions • Review common decision-making problems • Compare logical structure of decision with other views (ladder of inference) cheurfire.com

  28. Step 6: Communicate Your Decision and Move to Action Transparency = support/commitment cheurfire.com

  29. Was It A Good Decision?! cheurfire.com

  30. Evaluating Decision Outcomes • Post-decisional justification • Tendency to inflate quality of selected option • Forget or downplay rejected alternatives • Results from need to maintain positive self-identity • Initial optimistic evaluation of decision cheurfire.com

  31. Evaluating Decision Outcomes • Escalation of Commitment • Tendency to repeat bad decision or allocate more resources to a failing course of action • Why? • Self-justification • Prospect theory effect • Perceptual blinders • Closing costs cheurfire.com

  32. Evaluating Decision Making • Separate decision choosers from evaluators • Stop-Loss: Establish a preset level to abandon the project • Involve several people in the evaluation process – may notice problems sooner cheurfire.com

  33. Dicey Decision Making Activity: Dire Decisions cheurfire.com

  34. Objectives • Learn about the different types of power • Discuss ways to build referent and expert power • Compare and contrast push vs. pull persuasion techniques • Understand the basis for motivational theory • Generate ideas for how best to motivate others cheurfire.com

  35. Different Types of Power cheurfire.com

  36. Five Bases of Power* Positional Power • Legitimate • Reward • Coercive Personal Power • Expert • Referent *French and Raven cheurfire.com

  37. Five Bases of Power Activity: Power Play cheurfire.com

  38. Building Power • Expert/Referent Power • Gain expertise • Promote image of expertise • Maintain credibility • Act confidently/decisively in a crisis • Keep informed • Recognize others’ concerns • Avoid threatening self-esteem of others cheurfire.com

  39. Persuasion and Influence "It's important for people to understand persuasion for what it is
– not convincing and selling but learning and negotiating.” 
– Jay Conger cheurfire.com

  40. Influencing Styles cheurfire.com

  41. Push vs. Pull • Push strategies are most effective when… • Recipient defers to expert and recognizes lack of expertise • Recipient does not view perspective as threatening • Recipient recognizes influencer’s power • Recipient trusts influencer’s motives cheurfire.com

  42. Push vs. Pull • Pull strategies are most effective when… • Recipient has strong opinions/views • Recipient views influencer’s perspective as threatening • Recipient does not recognizes influencer’s power • Recipient does not trust influencer’s motives • Unknown what recipient will accept • Push style has failed in past cheurfire.com

  43. Push vs. Pull Seek first to understand, then to be understood. - Stephen R. Covey cheurfire.com

  44. The Art of Persuasion1 • Credibility (power) • Common Ground (relatedness) • Vivid Evidence (beyond data) • Emotional Connection (yours/theirs) 1Conger, Jay. “The Necessary Art of Persuasion. Harvard Business Review. 1998.” cheurfire.com

  45. The Art of Persuasion Activity: What Do We Do About the Neighbours? cheurfire.com

  46. Motivating Employees Extrinsic vs. Intrinsic motivators cheurfire.com

  47. Maslow’s Hierarchy Self-actual-ization Need to know Need for beauty Esteem Belongingness Safety Physiological cheurfire.com

  48. Motivating Employees cheurfire.com

  49. Motivation Extrinsic vs. Intrinsic motivators cheurfire.com

  50. Motivation/Hygiene Factors cheurfire.com

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