Module ? – Decision Making
This module gives you an overview of decision making, including group decision
making processes and tools. It looks at the stages of decision making and provides
some tips and tools to ensure that you are able to critically analyse data/ information
in order to make informed decisions in your organisation.
Learning Outcomes
By the end of this module you will be able to:

Understand the decision making process.

Identify decision making pitfalls.

Define your decision making process.

Implement group decision making processes
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An Introduction to Decision Making
Show the short video clip “Ellen on Decision making”.
Introduce decision making and link it to the module on problem solving. Explain that
while we make many decisions every day, this specifically focuses on decision
making in the workplace, including group decision making.
Decisions are an important facet of our everyday lives. We are constantly make
decisions in our home life and work life some of these affect immediate situation
others can will impact heavily our future. That is why having the skills to make good,
solid decisions is important.
Most of us make many decisions automatically; we don’t take the time to think about
the process we use to reach these decisions. Deciding to get out of bed in the
morning, deciding what clothes to wear to work or deciding what to eat for supper
may seem relatively simple for some people but for others this may be very
challenging. Like with all skills, in order to perform at a maximum level, decision
making skills need to be practised in order to perfect the skill. The more these skills are
practised, the easier it gets to master decision making.
The objective of making a decision is to choose your best alternative – based on the
facts provided – that will lead to a productive end result.
Instruct learners to read through the following article – had have a brief discussion
about the way in which we make decisions. This article is a lead into understanding a
more comprehensive and effective way in which to make decisions, specifically
focusing on group decision making.
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Do we fool ourselves in decision making?
Article: How We Sometimes Fool Ourselves When Making Decisions (By Kare
Anderson)
Think back on a decision you made in the past that cost you dearly in sales or a
valued relationship. Consider some smaller decisions where you realize in retrospect
that, if you’d made another choice, you’d have saved time or avoided aggravation.
What if you found out that your mind played tricks on you? You could have thought
things out better, and made a wiser choice? Perhaps you were relying on your "gut
instincts" yet, in fact, were fooled by unconscious decision-making traps we fall into
when trying to figure out what we should do.
According to one of my all-time heroes, negotiations guru, Howard Raiffa, we are
destined to repeat the same faulty decision making process and face more grief
from the poor results if we don’t gain insights into some of these traps.
According to Raiffa, the fault often lies not in the decision-making process but rather
in the mind of the decision maker. The way the human brain works can sabotage our
decisions. Here are some insights into the most well-documented traps we set for
ourselves in making decisions.
The Routines of Decision Making
We use unconscious routines, called heuristics, to cope with the complexity inherent
in decision making. They serve us well in most situations. For example, in judging
distances, we equate clarity with proximity. The clearer an object appears, the closer
we judge it to be. The fuzzier, the farther we think it is. Like most heuristics, it is not fool
proof. On days that are hazier than that to which we are accustomed, our eyes will
tend to trick our minds into thinking that things are more distant than they actually
are. For airplane pilots this distortion could be catastrophic if they weren’t trained to
use other truly objective measures and instruments. While this decision making flaw is
based on sensory perception others are based on biases, still others on irrational
anomalies in our thinking. They are potentially dangerous because they are invisible
to us. They are hardwired into our thinking so we fail to even recognize that we are
using them.
Anchoring
How would you answer these two questions?
1. Is the population of Turkey greater than 35 million?
2. What’s your best estimate of Turkey’s population?
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Do we fool ourselves in decision making? continued
If you are like most people, the figure of 35 million (researchers chose arbitrarily)
influenced your answer to the second question. I’ve watched the behavioural
scientists ask variations of these questions to groups of people many times over the
past decade. In half the cases, 35 million was used in the first question, in the other
half, 100 million. Without fail, the answers to the second question increase by millions
when the larger figure is used (as an anchor) in the first question.
When considering a decision, the mind gives disproportionate weight to the first
information it receives. Initial impressions, estimates or other data anchor subsequent
thoughts and judgements. The implications to influence another’s perceptions are
mind-boggling and can take many guises. A colleague can offer a comment or a
statistic can appear in the morning paper which will influence your subsequent
decision making on that topic. Other guises can be as insidious as a stereotype about
a person’s skin colour, clothing or accent.
In business, one of the most frequent "anchors" is a past event or trend. A marketer, in
attempting to project sales of a product for the coming year, often begins by looking
at the sales volumes for past years. This approach tends to put too much weight on
past history and not enough weight on other factors.
Because anchors can establish the terms on which a decision will be made, they can
be used as a bargaining tactic by savvy negotiators.
Reduce the impact of the effects of anchoring in these ways:
1. Be open minded. Seek information and opinions from a variety of people to
widen your frame of reference, without dwelling disproportionately on what
you heard first.
2. In seeking advice from others, offer information -- just the facts without your
opinion -- so that you don’t inadvertently anchor them with your thoughts.
Then you can benefit from hearing diverse views on the situation without their
views being coloured or anchored by yours.
3. Whoever most vividly characterizes the situation usually anchors the other’s
perception of it. That’s an immensely powerful ability. Others literally see and
discuss the situation while anchored from that most memorably stated
perspective. The vivid communicator has literally created the playing field on
which the game will be played on. Be especially wary of anchors in
negotiations.
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Do we fool ourselves in decision making? continued
Think through your position before any negotiation begins in order to avoid
being anchored by someone else’s proposal or position.
Status-Quo Trap
We instinctively stay with what seems familiar. Thus we look for decisions that involve
the least change. For example, when radically new products are introduced, they
are made to look like an existing and familiar product. The first cars looked like
horseless carriages. The first online newspapers and magazines had formats much like
their print counterparts.
To protect our egos from damage, we avoid acting to change the status quo, even
in the face of early warnings that demonstrate that change will be safer. We look for
reasons to do nothing.
For example, in one experiment, a group of people were randomly given one of two
gifts of approximately the same value - half received a mug, the other half got a
large, Swiss chocolate bar. They were told that they could easily exchange the gift
they received for the other gift. While you might expect that about half would have
wanted to make the exchange, only one in ten actually did. The power of status quo
kicked in within minutes of receiving an object. Other experiments have shown that
the more choices you are given, the more pull the status quo has. Why? Because
more choices involve more effort while selecting the status quo avoids that effort.
In business, the sins of commission (doing something) tend to be punished much more
severely than sins of omission (doing nothing). In all parts of life, people want to avoid
rocking the boat.
What can you do? Think of your goals first, when preparing to make a decision, then
review how they are served by the status quo as compared by a change. Look at
each possible change, one at a time, so you don’t overwhelm yourself and then
instinctively want to "stay safe" and unchanged.
Never think of the status quo as your only alternative. Ask yourself whether you would
choose the status quo, if, in fact, it weren’t the status quo.
Avoid the natural tendency of exaggerating the effort or cost or emotional reaction
of others or for yourself if you change from the status quo.
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Do we fool ourselves in decision making? continued
Remember that the desirability of the status quo may change over time. When
considering a change, look at possible future situations. If you have several
alternatives that are superior to the status quo, avoid the natural tendency to fall
back upon the status quo because you are having a hard time choosing between
the other alternatives.
The Justify- Past-Actions Trap
The more actions you have already taken on behalf of a choice or direction, the
more difficult you will find it to change direction or make a different choice.
Whenever you invest time, money, or other resources, or whenever your personal
reputation is at stake, you will find it more difficult to change your decision or course
of action.
Suppose you pour a great deal of time and effort into offering a product to a new
niche market. Because you have already used resources to be successful in that
market, you will find it difficult to withdraw, even when the market clearly is not
interested in your product.
If you have a once-close childhood friend who has not been supportive of you for
years, you’ll be reluctant to acknowledge that change and will likely act as if you are
still close.
Banks used to continue to lend to businesses that had fallen back on payments, thus
throwing good money after bad.
For all decisions with a history, make a conscious effort to set aside your "past actions"
- investments of emotion, money or other resources - as you consider whether to
change direction. Seek out and listen to people who were uninvolved with the earlier
decisions. Examine why admitting an earlier mistake distresses you. If the problem lies
in your wounded ego, deal with it straight-away. As Warren Buffet once said, "When
you find yourself in a hole, the best thing you can do is stop digging."
Don’t cultivate a failure-fearing culture in the people around you at home or at work.
In such an atmosphere, others will perpetuate mistakes rather than admitting them to
you and changing course. When you set an example of admitting mistakes in your
choices and self-correcting, others will believe they can do likewise without penalties
from you.
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Do we fool ourselves in decision making? continued
Although we hope to learn from every mistake, we can’t help but long for a faster
learning curve so we might continue in a wiser, smoother path through the process of
making decisions. I hope your awareness of these traps can help you avoid them in
your future decision-making.
Kare Anderson is a behavioral futurist who speaks and writes about "Say It Better"
methods of thoughtful communication, conflict resolution, cross-promotion and
outreach, and multisensory techniques to create more memorable on-site
experiences. An Emmy-winning former TV commentator, Wall Street Journal reporter
she’s a national columnist in 98 monthly magazines (from Gourmet Retailer to
Broadcast Engineering), nine-time author ( Getting What You Want, Pocket CrossPromotions, Make Yourself Memorable, Beauty Inside Out, Cutting Deals With Unlikely
Allies, Resolving Conflict Sooner . . .) and publisher of the "Say It Better" online
newsletter now read by over 17,000 people in 32 countries, which is available free
when you sign the guest book at her web site at www.sayitbetter.com. Anderson is
the co-founder of The Compelling Communications Group
The Compelling Communications Group
Website: http://www.sayitbetter.com
Suggested reading
1.
Smart Choices: A Practical Guide to Making Better Decisions, by Howard Raiffa,
John S. Hammond and Ralph L. Keeney.
2.
Decision Traps: Ten Barriers to Brilliant Decision Making and How to Overcome
Them, by J. Edward Russo and Paul J. H. Schoemaker.
3.
Judgment in Managerial Decision Making, by Edward J. Russo and Max H.
Bazerman.
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Decision making as a skill in the workplace
Explain that decision making is a skill that all managers / leaders need to refine if they
want to be effective in the workplace. Remind learners that, as with any skill, the
more you practice the better you will become at decision making.
Decision-making is a key skill in the workplace, and is particularly important if you
want to be an effective leader.
Whether you're deciding which person to hire, which supplier to use, or which strategy
to pursue, the ability to make a good decision with available information is vital. It
would be easy if there were one formula you could use in any situation, but there isn't.
Each decision presents its own challenges, and we all have different ways of
approaching problems.
Simple decisions usually need a simple decision-making process. But difficult decisions
typically involve issues like these:

Uncertainty - Many facts may not be known.

Complexity - You have to consider many interrelated factors.

High-risk consequences - The impact of the decision may be significant.

Alternatives - Each has its own set of uncertainties and consequences.

Interpersonal issues - It can be difficult to predict how other people will react.
With these difficulties in mind, the best way to make a complex decision is to use an
effective process. Clear processes usually lead to consistent, high-quality results, and
they can improve the quality of almost everything we do.
As important, we need to consider: “how do I avoid making bad decisions – or
leaving decisions to chance?” You need a systematic approach to decision-making
so that, no matter what type of decision you have to make, you can take decisions
with confidence.
No one can afford to make poor decisions.
An organised and systematic decision-making process usually leads to better
decisions. Without a well-defined process, you risk making decisions that are based
on insufficient information and analysis. Many variables affect the final impact of your
decision. However, if you establish strong foundations for decision making, generate
good alternatives, evaluate these alternatives rigorously, and then check your
decision-making process, you will improve the quality of your decisions.
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Direct learners to Learning Activity 1 in the Learner Guide – Pg 10 to 12. This activity is
a short quiz to help learners review their current decision making skills.
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Learning Activity 1 – How good are your decision making
skills?
For each statement, tick the box in the column that best describes you. Please answer
1
Very often
Often
Sometimes
STATEMENT
Rarely
Not at all
questions as you actually are (rather than how you think you should be.
I evaluate the risks associated with
each alternative before making a
decision.
2
After I make a decision, it's final –
because I know my process is
strong.
3
I try to determine the real issue
before starting a decision-making
process.
4
I rely on my own experience to
find potential solutions to a
problem.
5
I tend to have a strong "gut
instinct" about problems, and I rely
on it in decision-making.
6
I am sometimes surprised by the
actual consequences of my
decisions.
7
I use a well-defined process to
structure my decisions.
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8
Very often
Often
Sometimes
Rarely
Not at all
STATEMENT
I think that involving many
stakeholders to generate solutions
can make the process more
complicated than it needs to be.
9
If I have doubts about my
decision, I go back and recheck
my assumptions and my process.
10
I take the time needed to choose
the best decision-making tool for
each specific decision.
11
I consider a variety of potential
solutions before I make my
decision.
12
Before I communicate my
decision, I create an
implementation plan.
13
In a group decision-making
process, I tend to support my
friends' proposals and try to find
ways to make them work.
14
When communicating my
decision, I include my rationale
and justification.
15
Some of the options I've chosen
have been much more difficult to
implement than I had expected.
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16
Very often
Often
Sometimes
Rarely
Not at all
STATEMENT
I prefer to make decisions on my
own, and then let other people
know what I've decided.
17
I determine the factors most
important to the decision, and
then use those factors to evaluate
my choices.
18
I emphasize how confident I am in
my decision as a way to gain
support for my plans.
Total
As you answered the questions, did you see some common themes? We based our
quiz on six essential skills required for effective decision-making:
1.
Establishing a positive decision-making environment.
2.
Generating potential solutions.
3.
Evaluating the solutions.
4.
Deciding.
5.
Checking the decision.
6.
Communicating and implementing.
If you're aware of these six basic elements and improve the way you structure them,
this will help you develop a better overall decision-making system.
To complete this quiz online for a more in-depth evaluation go to:
http://www.mindtools.com/pages/article/newTED_79.htm
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Explain to learners that this activity is a quick reflection of their current decision
making skills. There is no right or wrong answers.
If they would like a more in depth analysis of their decision making skills, then they
can complete the online quiz at the web address given above
Refer learners to the following article on Managerial decision making.
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Managerial decision making
Article: Managerial decision making and the decision making process (By L. Hurley,
16 November 2008)
Making decisions is what managers do. A surgeon operates, a mechanic fixes cars
and a manager makes decisions. Ideally the decisions made by managers create an
environment which allows both the business and employees to succeed and grow.
Before any decision can be made a manager must have the authority to do so. Most
companies have clearly delegated and documented authorities for making financial
and human resource decisions. Day-to-day operational decisions, such as what time
breaks will be taken, are usually assumed as part of the role and inferred by
responsibilities in the position description.
As managers we are personally and sometimes legally responsible for the effects of
our decisions so it is important to understand and stay within the boundaries of our
authority. We also want to make good decisions. Good decisions are those that allow
the business to grow and employees to develop and succeed.
Good decisions require an element of judgement. A decision made with too little
information can have an unexpected and unwelcome outcome. While delaying a
decision for too long to obtain all possible information can render the decision
ineffective.
The more information we have the better prepared we are to make effective
decisions and the less likely it is that we will be surprised by an unforeseen outcome.
We need to gather as much relevant information as possible within the timeframe
available.
Information can come in many forms. Data provides an excellent basis for
understanding trends, analysing and predicting volume, cost and profit but on its own
data is not enough. Speaking with subject matter experts and the people who will be
impacted by the decision provides context in which the objective data may be
viewed.
Once a manager has all the relevant information they need to make the decision it is
appropriate to test the effect of the decision against a number of elements.
LEGAL
Does it conform to local and federal legislative requirements? Does it comply with
company policy and fit within the terms of the customer contract?
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Managerial decision making, continued
ETHICAL
While unethical decisions may be legal a good decision remains within the ethical
code of the company.
OVERT AND EQUITABLE
Is the purpose and reason for making the decision clear to everyone? Have the
needs of all parties been balanced as far as is practical?
SENSIBLE
Perhaps the most important element of a good decision is whether it makes sense.
The decision will be more readily accepted if everyone can understand the need for
it.
PERSONAL STANDARDS
When the decision passes the legal, ethical, overt, equitable and sensible tests there
is one final test to be applied. Would you be happy for the decision to be reported in
the media or will you be hiding behind closed doors and drawn shades if the
outcome hits the news?
Whether the decision is about a staff roster or a major investment in technology it
should be based on relevant information, involve input from the right people and
have all the elements of a good decision. If it does, go ahead and make the
decision, record it and follow through with implementation.
Briefly discuss (deconstruct) a manager’s responsibility in terms of decision making
within their position as a manager, and the potential short- and long term impact of
poor decision making skills on the organisation.
Direct learners to Learning Activity 2.
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Learning Activity 2 – Decision making practices
1. Read though ”Popular methods for decision making” below.
2. Share some of the dysfunctional decision making practices that you have
experienced?
3. Suggest ways to defuse these styles.
This activity can be done as group work. Ask groups to discuss the two questions,
note similarities in their experiences and share these with the larger group.
Ask learners to discuss the effectiveness of these decision making strategies.
Remind learners that while they may have experienced these decision making
processes, we are in fact using this article as an example of how “not to” in the
decision making in the organisational context.
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Popular methods for decision making
Companies, and managers, use many different strategies to make decisions, many of
which are not effective and lead to costly consequences for the company. The
following is a list of strategies that many of us have seen in practice. They all lead to
decisions, but they all run the risk of not making good use of the available people
and information. Have you ever experienced these?
1. Decision by Running Out of Time: This is the most common form of decisionmaking. There may be some effort to develop criteria and alternatives, but
often time runs out before there is any effort to ensure that a robust decision is
made.
2. Decision by chaos: The president of the company says, “I want our new
product at the Rand Easter show in two weeks”. The show is in two weeks.
There is no rational way to prepare for the show and make robust decisions.
The decisions made in the chaos may need revisiting after the show and work
will need to be redone. Some people prefer to work in a chaotic environment,
and when in positions of power, they will manufacture chaos as the working
environment.
3. Decision by Fiat (or Decision by Authority): This is a very common style in
autocratic organisations where a manager or someone else in authority
decrees that a certain alternative is his/her favourite. It is often seen when the
boss’s idea is chosen in order to preserve the relationship with him/her. This is
more justification than decision-making.
4. Decision by Coercion: A champion for one alternative pressures his/her
colleagues into submission. Often the loudest voice wins, the others having
given up. One colleague referred to this style as “hijacking the process”.
5. Decision by Competition: Here concern for who wins is most important, as
instanced in most sports. This is often a win-lose situation and the relationship
among individual team members is not important.
6. Decision by Voting: Democracy works, but does not often make the best
possible choice. This decision making process is a weak form of compromise.
Think how most products and businesses would operate if they were designed
the same way we elect a president.
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Popular methods for decision making , continued
7. Decision by Inertia: This style is based on “We did it that way before” which
may result in a robust decision, if the previous one was. But, not much progress
or innovation is made using this style. Sometimes the tough decision is knowing
when to innovate, and when to keep the cruise control on.
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The decision making process
Explain that we will now be looking at more effective strategies/ process for effective
decision making.
In the business environment, decision making is an essential leadership skill. If you can
learn how to make timely, well-considered decisions, then you can lead your team to
well-deserved success. If, however, you make poor decisions, your time as a leader
will be brutally short.
There is one quality that distinguishes a good manager from a poor one, it is
decisiveness. A person in managerial position who is poor in decision making is fit to
be called only an administrator and not a manager. For a professional manager, the
decision making process normally involves the following stages:
1) Establishing a positive decision-making environment while defining the
problem /issues / situations / challenges and collecting relevant facts, figures
and statistics to facilitate and support the decision making process. Steps
include:
If you've ever been in a meeting where people seem to be discussing different issues,
then you've seen what happens when the decision-making environment hasn't been
established. It's so important for everyone to understand the issue before preparing to
make a decision. This includes agreeing on an objective, making sure the right issue is
being discussed, and agreeing on a process to move the decision forward.
To create a constructive environment for successful decision making, make sure you
do the following:

Establish the objective - Define what you want to achieve.

Agree on the process - Know how the final decision will be made, including
whether it will be an individual or a team-based decision. The Vroom-YettonJago Model could be a useful tool for determining the most appropriate way
of making the decision.

Involve the right people - Address key interpersonal considerations at the very
beginning. Have you included all the stakeholders? And do the people
involved in the decision agree to respect one another and engage in an
open and honest discussion? After all, if only the strongest opinions are heard,
you risk not considering some of the best solutions available.
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
Allow opinions to be heard - Encourage participants to contribute to the
discussions, debates, and analysis without any fear of rejection from the
group. This is one of the best ways to avoid groupthink. The Stepladder
Technique is a useful method for gradually introducing more and more
people to the group discussion, and making sure everyone is heard. Also,
recognize that the objective is to make the best decision under the
circumstances: it's not a game in which people are competing to have their
own preferred alternatives adopted.

Make sure you're asking the right question - Ask yourself whether this is really
the true issue. The 5 Whys technique is a classic tool that helps you identify the
real underlying problem that you face. In collecting information, there has to
be a limit somewhere; one cannot definitely decide using inadequate and
incorrect information. At the same time, one cannot keep on accumulating
information for the sake of greatest clarity and lose time in the bargain. Some
calculated risks must be taken where complete data cannot be collected
accurately.

Use creativity tools from the start - The basis of creativity is thinking from a
different perspective. Do this when you first set out the problem, and then
continue it while generating alternatives. Our article Generating New Ideas
will help you create new connections in your mind, break old thought
patterns, and consider new perspectives.
2) Generating potential solutions and seek opinions and alternative viewpoints
from "people who know" and "people who matter".
This step is still critical to making an effective decision. The more good options you
consider, the more comprehensive your final decision will be.
When you generate alternatives, you force yourself to dig deeper, and look at the
problem from different angles. If you use the mindset ‘there must be other solutions
out there,' you're more likely to make the best decision possible. If you don't have
reasonable alternatives, then there's really not much of a decision to make!
Consultation with "people who know" will involve definitely ego clashes and
conflicting opinions. Sometimes, involving "those who matter" may not be practical
always.
Here's a summary of some of the key tools and techniques to help you and your team
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develop good alternatives.

Generating Ideas

Brainstorming is probably the most popular method of generating
ideas.

Another approach, Reverse Brainstorming, works similarly. However, it
starts by asking people to brainstorm how to achieve the opposite
outcome from the one wanted, and then reversing these actions.

The Charette Procedure is a systematic process for gathering and
developing ideas from very many stakeholders.

Use the Crawford Slip Writing Technique to generate ideas from a
large number of people. This is an extremely effective way to make
sure that everyone's ideas are heard and given equal weight,
irrespective of the person's position or power within the organization.

Considering Different Perspectives

The Reframing Matrix uses 4 Ps (product, planning, potential, and
people) as the basis for gathering different perspectives. You can also
ask outsiders to join the discussion, or ask existing participants to adopt
different functional perspectives (for example, have a marketing
person speak from the viewpoint of a financial manager).

If you have very few options, or an unsatisfactory alternative, use a
Concept Fan to take a step back from the problem, and approach it
from a wider perspective. This often helps when the people involved in
the decision are too close to the problem.

Appreciative Inquiry forces you to look at the problem based on
what's ‘going right,' rather than what's ‘going wrong.'

Organizing Ideas
This is especially helpful when you have a large number of ideas. Sometimes
separate ideas can be combined into one comprehensive alternative.

Use Affinity Diagrams to organize ideas into common themes and
groupings.
It is important to realise though, that a manager, by virtue of being a manager, may
not be an expert in all the matters related to the decision making and hence
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consulting experts and knowledgeable persons, including those in the lower level of
managerial pecking order, would be highly essential. "I know it all" attitude and bias
on views of certain persons based purely on personal whims and fancies can seriously
impede the decision making process.
3) Evaluating the solutions: eg: by assessing the pro’s and con’s, or prioritising
elements and assigning them a weight against consequence.
When you're satisfied that you have a good selection of realistic alternatives, then
you'll need to evaluate the feasibility, risks, and implications of each choice. Here, we
discuss some of the most popular and effective analytical tools.

Risk
In decision making, there's usually some degree of uncertainty, which
inevitably leads to risk. By evaluating the risk involved with various options, you
can determine whether the risk is manageable.

Risk Analysis helps you look at risks objectively. It uses a structured
approach for assessing threats, and for evaluating the probability of
events occurring - and what they might cost to manage.

Implications
Another way to look at your options is by considering the potential
consequences of each.

Six Thinking Hats helps you evaluate the consequences of a decision
by looking at the alternatives from six different perspectives.

Impact Analysis is a useful technique for brainstorming the
‘unexpected' consequences that may arise from a decision.

Validation
Determine if resources are adequate, if the solution matches your objectives,
and if the decision is likely to work in the long term.

Starbursting helps you think about the questions you should ask to
evaluate an alternative properly.

To assess pros and cons of each option, use Force Field Analysis, or use
the Plus-Minus-Interesting approach.

Cost-Benefit Analysis looks at the financial feasibility of an alternative.
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4) Deciding on the best choice or a couple of best courses of action.
After you have evaluated the alternatives, the next step is to choose between them.
The choice may be obvious. However, if it isn't, these tools will help:

Grid Analysis, also known as a decision matrix, is a key tool for this type of
evaluation. It's invaluable because it helps you bring disparate factors into
your decision-making process in a reliable and rigorous way.

Use Paired Comparison Analysis to determine the relative importance of
various factors. This helps you compare unlike factors, and decide which ones
should carry the most weight in your decision.

Decision Trees are also useful in choosing between options. These help you lay
out the different options open to you, and bring the likelihood of project
success or failure into the decision making process.
Making the decision itself can be exciting and stressful. To help you deal with these
emotions as objectively as possible, use a structured approached to the decision. This
means taking a look at what's most important in a good decision.
Take the time to think ahead and determine exactly what will make the decision
“right.” This will significantly improve your decision accuracy.
For group decisions, there are some excellent evaluation methods available.
When decision criteria are subjective and it's critical that you gain consensus, you
can use techniques like Nominal Group Technique and Multi-Voting. These methods
help a group agree on priorities, for example, so that they can assign resources and
funds.
The Delphi Technique uses multiple cycles of anonymous written discussion and
argument, managed by a facilitator. Participants in the process do not meet, and
sometimes they don't even know who else is involved. The facilitator controls the
process, and manages the flow and organization of information. This is useful where
you need to bring the opinions of many different experts into the decision-making
process. It's particularly useful where some of these experts don't get on!
5) Review and evaluate the decision and the results from implementing a course
of action based on this decision(s).
With all of the effort and hard work that goes into evaluating alternatives, and
deciding the best way forward, it's easy to forget to ‘sense check' your decisions. This
is where you look at the decision you're about to make dispassionately, to make sure
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that your process has been thorough, and to ensure that common errors haven't
crept into the decision-making process. After all, we can all now see the catastrophic
consequences that over-confidence, groupthink, and other decision-making errors
have wrought on the world economy.
The first part of this is an intuitive step, which involves quietly and methodically testing
the assumptions and the decisions you've made against your own experience, and
thoroughly reviewing and exploring any doubts you might have.
A second part involves using a technique like Blindspot Analysis to review whether
common decision-making problems like over-confidence, escalating commitment, or
groupthink may have undermined the decision-making process.
A third part involves using a technique like the Ladder of Inference to check through
the logical structure of the decision with a view to ensuring that a well-founded and
consistent decision emerges at the end of the decision-making process.
Remember that some things about a decision are not objective. The decision has to
make sense on an intuitive, instinctive level as well. The entire process we have
discussed so far has been based on the perspectives and experiences of all the
people involved. Now it's time to check the alternative you've chosen for validity and
"making sense."
If the decision is a significant one, it's also worth auditing it to make sure that your
assumptions are correct, and that the logical structure you've used to make the
decision is sound.
6) Accept responsibility.
People who don't take responsibility for their work or actions can have a negative
impact on their team or organisation.
Remember that even some small choices can have big consequences. Don’t
underestimate the possibility that major consequences could result from seemingly
insignificant choices you make along the way. By taking responsibility, you also
assume control for the response to what happened.
Always remember that it is easy to take responsibility when there are successes, but it
is a sign of maturity as a manager if you are able to do the same when there are
difficulties.
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Summarise by explaining that:
Sometimes, decision making may just involve taking "yes" or "no" decision in which
case, if the problem or issue is simple, there may not really be a need for any
elaborate data collection or need for wider consultations.
However, at times where the issue is of serious nature, even making yes or no decision
may involve all the elaborate stages that we have included here. Where the decision
making involves multiple choices, it may get more complicated.
An organized and systematic decision-making process usually leads to better
decisions. Without a well-defined process, you risk making decisions that are based
on insufficient information and analysis. Many variables affect the final impact of your
decision. However, if you establish strong foundations for decision making, generate
good alternatives, evaluate these alternatives rigorously, and then check your
decision-making process, you will improve the quality of your decisions.
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Decision making tools and techniques
Explain that now that we have looked at the overall strategy/ process, we need to
look at some of the tools and techniques we can employ to help us in the decision
making process.
Like so many things, smart decision-making can benefit from the addition of structure,
focus, and a bit of metaphor. While imperfect in their own ways, the kinds of tools that
support this mental corralling can help tremendously in quieting the chaos, surveying
the available options, and then collecting and evaluating the information you need
to choose the best course of action.
Examples of the tools and techniques that can be used in the decision making
process include:
Brainstorming
Have a recorder list all the possible ideas from the group as
quickly as possible without any evaluation of ideas. Gather
as many ideas as you can as fast as you can. This list of
ideas is then shortened and a final solution can be
developed from the best items.
Brainwriting
Each person records an idea or solution to the problem on
a piece of paper and adds it to a pile. Everyone then takes
a different paper from the pile and adds an idea related to
the one already on that page. Write down the first thing
that comes to mind. These ideas can then be compiled
and discussed to develop a final solution. (This is often
successful in a quieter group, when it is difficult to get
everyone talking.)
Nominal Group
Each member shares their ideas. A recorder lists all the
Technique
different ideas. Everyone then ranks their preferences
individually from the whole list from 1-(up to) 10. These
scores are added together and a group score is given. This
gives priorities on a group basis. (If number 1 is used to rate
an individual best choice, then the list item with the smallest
group score is the most desired.)
Force-field Analysis
List forces "pushing for changing the situation" and "forces
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pushing against changing the situation". Outline the
strategies to minimize the strength of the forces and
develop an action plan to accomplish the solution.
Criteria Matrix
Develop a set of standards that each alternative is judged
on. Some examples are: costs, risks involved, timeliness,
convenience or satisfaction. The matrix looks like a table
with the alternatives down the left side and the criteria
across the top. Each alternative is ranked by the criteria (15, yes or no, etc) and the scores are added up at the
bottom.
Dotmocracy
Provide each person with the same number of dot stickers
or pennies or tokens. Vote individually on the list of
brainstormed alternatives. If someone feels strongly about
one item they are welcome to put all their dots on that
item. The alternative with the greatest number of dots is the
decision preference.
Bubble-up/Bubble-
Used for ranking statements or ideas or putting ideas in a
down
orderly sequence. Read the first two statements, decide
between the two which statement is least preferred and
should be eliminated. Now compare the statement left to
the next one on the list and continue to do this until you
have reached the last item on your list and the group is
satisfied. (for example: when purchasing a house; it is much
easier to compare the house you're viewing with the last
house you viewed. After evaluating how this one rates, you
eliminate one of the two. The preference of the two is the
only house used in future comparisons.)
Circle Chart
Divide the paper into four quadrants and label each
quadrant one of four titles: What is wrong?(in theory), What
might be done? (in theory), What is wrong?(in the real
world), and What might be done? (in the real world). This
will initiate a brainstorming session to help develop a
solution.
Appreciative Inquiry
When analysing a situation/ problem/ issue/ challenge shift
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to a positive perspective, look at the things that are
working, and build on them. In some situations this can be
very powerful because, by focusing on positives, you can
build the unique strengths which bring real success.
This list shows only some of the tools and techniques that can be used to facilitate
group decision making. There are many more, and more complex, options available.
It is important to choose the technique(s) or tool (s) that will work for you, the group
dynamics and will effectively help in decision making around specific problems/
issues.
Explain that this list is not exhaustive and there are many other tools and techniques
available. Refer learners to the additional reading resources at the end of their
Learners Guide for more insight into some these tools and techniques.
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Learning Activity 3 – Car
1.
2.
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Learning Activity 4 – Case Study: Southwest Airlines
Explain that learners will be assessing the decision making practices of one of the
most successful companies in the USA. Southwest Airlines was the only airline that
continued to show profit after 911, and has continued to grow through the current
economic recession.
Show the clip CEO@Smith_ Jim Parker, Southwest Airlines. Explain that this clip
provides insight into the organisational culture. The organisational culture at
Southwest very strongly affects their business decision making process.
Watch the video clip and read through the case study, then reflect on the following
questions related to the decision making process
1.
Decision making
Discuss what is meant by the term 'decision making'. Identify types of business
decision and classify the decision discussed within this case study.
2. Decision models
A variety of models and processes have been offered to suggest ideally how
people should or describe how they actually do make decisions. Describe
and discuss the decision making models used in this case study.
3. Decision making process within this case study
Describe the decision making process used in this case study.
4. Your decision
List/ summarise the factors influencing the decision at Southwest Airlines: what
would your decision have been?
This activity works particularly well, time permitting, as group work. Divide learners
into groups and ask them to work through each of the reflective points. Ask them to
capture salient point on newsprint and present back to the group.
Ensure that time is allocated for feedback/ sharing of differing points of view.
Reflective point 4 might raise a host of answers as each manager has a particular
style/ strategy/ process for decision making. To wrap up explain that it is important to
be aware of the processes available and to make use of them according to the
problem/ issue/ challenge that you are dealing with at a particular point in time.
Explain that there is no “one shoe fits all” solution to decision making, and that it
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might take some time to find the process/ style that works for you as a manager, as
well as your team.
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Case study: Corporate decision making
Case problem: Decisions about whether, when and how to downsize (restructure).
Southwest Airlines Co. ("Southwest") is a major domestic airline that provides primarily
short haul, high‐frequency, point‐to‐point, low‐fare service. Founded in 1971 and
headquartered in the US, Southwest is a large low‐cost airline. Airlines rely on key inputs
such as aircraft, fuel and labour in order to operate. Like any airline it is sensitive to jet
fuel prices and other operating costs. FORTUNE has listed Southwest Airlines among
America’s Top Ten most admired corporations and previously ranked Southwest
Airlines in the top five of the “Best Companies to Work For” in America. Today
Southwest operates over 500 Boeing 737 aircraft in 66 cities. Southwest has among the
lowest cost structures in the domestic airline industry and consistently offers the lowest
and simplest fares. Southwest also has one of the best overall Customer Service
records. The company is committed to provide its employees with a stable work
environment with equal opportunity for learning and personal growth; there are more
than 35,000 employees throughout the Southwest system. The airline is unionized
(heavily unionized when compared with other US airlines). In 1995, Southwest became
one of the first airlines to have a web site. In 2006, 70 percent of flight bookings and 73
percent of revenue was generated from bookings on southwest.com.
After providing customers with the opportunity to book tickets online, Southwest
Airlines found it then had too many call centre agents.
Southwest Airlines provides us with a textbook example of effective organizational
downsizing. Of course, CEO James Parker and his team had a few things going for
them. The company had already established a culture of trust between employees
and management. In addition, the downsizing was prompted by a growth in online
bookings, meaning it was a technological event outside management's control that
spurred the need for layoffs.
Still, Southwest managed the change with notable effectiveness. First, it focused on
both the survivors and the victims and was concerned about retaining the motivation
and commitment of the people who remained. Second, there was a shared sense of
urgency. Parker didn't act until all employees—and not just management—could see
that there was a real need for the layoffs. And third, the airline handled the cuts in a
way that was both economically and procedurally fair. It offered severance pay and
gave employees the choice of moving to a different call center or taking a severance
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package and leaving the company.
It's important to recognize that what Southwest went through was necessary, in terms
of both the downsizing itself and the way it handled the process. Because so much
trust had been built among employees at all levels in the organization, management
had to proceed in such a way to keep that trust intact.
Learning from Southwest's Approach
Southwest's approach was quite a bit different from the way downsizings are usually
handled, which typically involves informing employees they are going to be
downsized, escorting them to the door, and shipping their personal belongings to their
home address. There's often no notice, no time to process the information, and no
choice given to the employees. That approach, which is driven by management and
forced upon employees, doesn't involve any form of employee participation.
And unlike the case with Southwest, the reason many organizations have to downsize
is strategic missteps or poor executive decision-making. That naturally causes a divide
between employees and top management and can create an adversarial
relationship.
However, it is important to realise that all organizations can learn from the Southwest
case. First, even if the downsizing is spurred by something internal, management can
build trust with the survivors. Companies can find ways of creating urgency and
getting employees on board with the need for change before it becomes absolutely
essential. Managers can do that by sharing information about performance and how
it must improve to maintain competitiveness. They can make sure severance pay is at
least industry-standard and share information about job leads.
Of course, things such as allowing employees to say goodbye to co-workers rather
than escorting them out the door can go a long way. Give people advance notice,
treat them with dignity and respect, and provide them with a reason for the
downsizing.
Rational economic arguments for change are considered alongside value based
arguments to continue the status quo.
Case Study References
Albright, S., Winston, W. and Zappe, C. (2006) 'Data Analysis & Decision Making ‐ with
Microsoft Excel', Ed. 3. South Western.
Cole, G A. and Kelly, P P. (2011) 'Management Theory and Practice', Ed. 7. Cengage
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EMEA.
Kelly, P P. (2009) 'International Business and Management', Cengage Learning EMEA.
Bloomberg Business week,
http://www.businessweek.com/mediacenter/video/managing/67d2716e3c136427911
5ee675b54bdc8cd14e92e.html
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Reading resources – The Vroom-Yetton-Jago Decision Model
http://www.mindtools.com/pages/article/newTED_91.htm
Deciding how to decide:
How you go about making a decision can involve as many choices as the decision
itself. Sometimes you have to take charge and decide what to do on your own. Other
times its better to make a decision using group consensus. How do you decide which
approach to use?
Making good decisions is one of the main leadership tasks. Part of doing this is
determining the most efficient and effective means of reaching the decision.
You don't want to make autocratic decisions when team acceptance is crucial for a
successful outcome. Nor do you want be involving your team in every decision you
make, because that is an ineffective use of time and resources. What this means is you
have to adapt your leadership style to the situation and decision you are facing.
Autocratic styles work some of the time, highly participative styles work at other times,
and various combinations of the two work best in the times in between.
The Vroom-Yetton-Jago Decision Model provides a useful framework for identifying
the best leadership style to adopt for the situation you're in.
Note:
This model was originally described by Victor Vroom and Philip Yetton in their 1973
book titled Leadership and Decision Making. Later in 1988, Vroom and Arthur Jago,
replaced the decision tree system of the original model with an expert system based
on mathematics. Hence you will see the model called Vroom-Yetton, Vroom-Jago,
and Vroom-Yetton-Jago. The model here is based on the Vroom-Jago version of the
model.
Understanding the Model:
When you sit down to make a decision, your style, and the degree of participation
you need to get from your team, are affected by three main factors:

Decision Quality – how important is it to come up with the "right" solution?
The higher the quality of the decision needed, the more you should involve
other people in the decision.
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
Subordinate Commitment - how important is it that your team and others
buy into the decision? When teammates need to embrace the decision
you should increase the participation levels.

Time Constraints – How much time do you have to make the decision? The
more time you have, the more you have the luxury of including others, and
of using the decision as an opportunity for teambuilding.
Specific Leadership Styles
The way that these factors impact on you helps you determine the best leadership
and decision-making style to use. Vroom-Jago distinguishes three styles of leadership,
and five different processes of decision-making that you can consider using:
Style:
Autocratic – you make the decision and inform others of it.
There are two separate processes for decision making in an
autocratic style:
Process:
Autocratic 1(A1) – you use the information you already have and
make the decision
Autocratic 2 (A2) – you ask team members for specific information
and once you have it, you make the decision. Here you don't
necessarily tell them what the information is needed for.
Style:
Consultative – you gather information from the team and other
and then make the decision.
Process:
Consultative 1 (C1) – you inform team members of what you
doing and may individually ask opinions, however, the group is
not brought together for discussion. You make the decision.
Consultative 2 (C2) – you are responsible for making the decision,
however, you get together as a group to discuss the situation,
hear other perspectives, and solicit suggestions.
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Style:
Collaborative – you and your team work together to reach a
consensus.
Process:
Group (G2) – The team makes a decision together. Your role is
mostly facilitative and you help the team come to a final decision
that everyone agrees on.
Tip:
This is a useful model, but it's quite complex and long-winded. Use it in new situations,
or in ones which have unusual characteristics: Using it, you'll quickly get a feel for the
right approach to use in more usual circumstances.
To determine which of these styles and processes is most appropriate, there is a series
of yes & no questions that you ask yourself about the situation, and building a decision
tree based on the responses. There are seven questions in total. These are:
1.
Is the technical quality of the decision very important? Meaning, are the
consequences of failure significant?
2.
Does a successful outcome depend on your team members' commitment
to the decision? Must there be buy-in for the solution to work?
3.
Do you have sufficient information to be able to make the decision on your
own?
4.
Is the problem well-structured so that you can easily understand what
needs to be addressed and what defines a good solution?
5.
Are you reasonably sure that your team will accept your decision even if
you make it yourself?
6.
Are the goals of the team consistent with the goals the organization has set
to define a successful solution?
7.
Will there likely be conflict among the team as to which solution is best?
Use Figure 1 below to follow your answers through on the decision tree and identify
the best decision process for your circumstances. Not that in some scenarios, you
don't need to answer all of the questions.
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In general, a consultative or collaborative style is most appropriate when:

You need information from others to solve a problem.

The problem definition isn't clear.

Team members' buy-in to the decision is important.

You have enough time to manage a group decision.
An autocratic style is most efficient when:

You have more expertise on the subject than others.

You are confident about acting alone.

The team will accept your decision.
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
There is little time available.
Key points:
The underlying assumption of the Vroom-Yetton-Jago Decision Models is that no one
leadership style or decision making process fits all situations.
By analysing the situation and evaluating the problem based on time, team buy-in,
and decision quality, a conclusion about which style best fits the situation can be
made. The model defines a very logical approach to which style to adopt and is
useful for managers and leaders who are trying to balance the benefits of
participative management with the need to make decisions effectively.
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Reading resources – Stakeholder Analysis
Winning support for your projects, by Rachel Thompson,
http://www.mindtools.com/pages/article/newPPM_07.htm
"Stakeholder management is critical to the success of every project in every
organization I have ever worked with. By engaging the right people in the right way in
your project, you can make a big difference to its success... and to your career."
As you become more successful in your career, the actions you take and the projects
you run will affect more and more people. The more people you affect, the more
likely it is that your actions will impact people who have power and influence over
your projects. These people could be strong supporters of your work – or they could
block it.
Stakeholder Management is an important discipline that successful people use to win
support from others. It helps them ensure that their projects succeed where others fail.
Stakeholder Analysis is the technique used to identify the key people who have to be
won over. You then use Stakeholder Planning to build the support that helps you
succeed.
The benefits of using a stakeholder-based approach are that:

You can use the opinions of the most powerful stakeholders to shape your
projects at an early stage. Not only does this make it more likely that they
will support you, their input can also improve the quality of your project

Gaining support from powerful stakeholders can help you to win more
resources – this makes it more likely that your projects will be successful

By communicating with stakeholders early and frequently, you can ensure
that they fully understand what you are doing and understand the benefits
of your project – this means they can support you actively when necessary

You can anticipate what people's reaction to your project may be, and
build into your plan the actions that will win people's support.
How to Use the Tool:
The first step in Stakeholder Analysis is to identify who your stakeholders are. The next
step is to work out their power, influence and interest, so you know who you should
focus on. The final step is to develop a good understanding of the most important
stakeholders so that you know how they are likely to respond, and so that you can
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work out how to win their support – you can record this analysis on a stakeholder map.
After you have used this tool and created a stakeholder map, you can use the
stakeholder planning tool to plan how you will communicate with each stakeholder.
The steps of Stakeholder Analysis are explained below:
Step 1. Identify Your Stakeholders
The first step in your stakeholder analysis is to brainstorm who your stakeholders are. As
part of this, think of all the people who are affected by your work, who have influence
or power over it, or have an interest in its successful or unsuccessful conclusion.
The table below shows some of the people who might be stakeholders in your job or in
your projects:
Your boss
Shareholders
Government
Senior executives
Alliance partners
Trades associations
Your co-workers
Suppliers
The press
Your team
Lenders
Interest groups
Customers
Analysts
The public
Prospective customers
Future recruits
The community
Your family
Remember that although stakeholders may be both organizations and people,
ultimately you must communicate with people. Make sure that you identify the
correct individual stakeholders within a stakeholder organization.
Step 2. Prioritize Your Stakeholders
You may now have a long list of people and organizations that are affected by your
work. Some of these may have the power either to block or advance. Some may be
interested in what you are doing, others may not care.
Map out your stakeholders on a Power/Interest Grid on our free template as shown in
figure 1, and classify them by their power over your work and by their interest in your
work.
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For example, your boss is likely to have high power and influence over your projects
and high interest. Your family may have high interest, but are unlikely to have power
over it.
Someone's position on the grid shows you the actions you have to take with them:
High power, interested people: these are the people you must fully engage

and make the greatest efforts to satisfy.
High power, less interested people: put enough work in with these people

to keep them satisfied, but not so much that they become bored with your
message.
Low power, interested people: keep these people adequately informed,

and talk to them to ensure that no major issues are arising. These people
can often be very helpful with the detail of your project.
Low power, less interested people: again, monitor these people, but do not

bore them with excessive communication.
Step 3. Understand Your Key Stakeholders
You now need to know more about your key stakeholders. You need to know how
they are likely to feel about and react to your project. You also need to know how
best to engage them in your project and how best to communicate with them.
Key questions that can help you understand your stakeholders are:

What financial or emotional interest do they have in the outcome of your
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work? Is it positive or negative?

What motivates them most of all?

What information do they want from you?

How do they want to receive information from you? What is the best way of
communicating your message to them?

What is their current opinion of your work? Is it based on good information?

Who influences their opinions generally, and who influences their opinion of
you? Do some of these influencers therefore become important
stakeholders in their own right?

If they are not likely to be positive, what will win them around to support
your project?

If you don't think you will be able to win them around, how will you manage
their opposition?

Who else might be influenced by their opinions? Do these people become
stakeholders in their own right?
A very good way of answering these questions is to talk to your stakeholders directly –
people are often quite open about their views, and asking people's opinions is often
the first step in building a successful relationship with them.
You can summarize the understanding you have gained on the stakeholder map, so
that you can easily see which stakeholders are expected to be blockers or critics, and
which stakeholders are likely to be advocates and supporters or your project. A good
way of doing this is by color coding: showing advocates and supporters in green,
blockers and critics in red, and others who are neutral in orange.
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Figure 2 shows an example of this – in this example, you can see that a lot of effort
needs to be put into persuading Piers and Michael of the benefits of the project –
Janet and Amanda also need to managed well as powerful supporters.
Example:
You can create your own example of stakeholder analysis at work – whether for your
current role, a job you want to do or a new project.
Conduct a full stakeholder analysis. Ask yourself whether you are communicating as
effectively as you should be with your stakeholders. What actions can you take to get
more from your supporters or win over your critics?
Key Points:
As the work you do and the projects you run become more important, you will affect
more and more people. Some of these people have the power to undermine your
projects and your position. Others may be strong supporters of your work.
Stakeholder Management is the process by which you identify your key stakeholders
and win their support. Stakeholder Analysis is the first stage of this, where you identify
and start to understand your most important stakeholders.
The first stage of this is brainstorm who your stakeholders are. The next step is to
prioritize them by power and interest, and to plot this on a Power/Interest grid. The final
stage is to get an understanding of what motivates your stakeholders and how you
need to win them around.
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Reading resources – Avoiding Groupthink
Avoiding fatal flaws in group decision making,
http://www.mindtools.com/pages/article/newLDR_82.htm
Have you ever thought about speaking up in a meeting and then decided against it
because you did not want to appear unsupportive of the group's efforts? Or led a
team in which the team members were reluctant to express their own opinions? If so,
you have probably been a victim of "Groupthink".
Groupthink is a phenomenon that occurs when the desire for group consensus
overrides people's common sense desire to present alternatives, critique a position, or
express an unpopular opinion. Here, the desire for group cohesion effectively drives
out good decision-making and problem solving.
Two well-known examples of Groupthink in action are the Challenger Space Shuttle
disaster and the Bay of Pigs invasion. Engineers of the space shuttle knew about some
faulty parts months before takeoff, but they did not want negative press so they
pushed ahead with the launch anyway. With the Bay of Pigs invasion, President
Kennedy made a decision and the people around him supported it despite their own
concerns.
The term "Groupthink" was coined by Irving Janis in 1972 when he was researching why
a team reaches an excellent decision one time, and a disastrous one the next. What
he found was that a lack of conflict or opposing viewpoints led to poor decisions,
because alternatives were not fully analyzed, and because groups did not gather
enough information to make an informed decision.
How to Spot Groupthink
Janis suggested that Groupthink happens when there is:

A strong, persuasive group leader.

A high level of group cohesion.

Intense pressure from the outside to make a good decision.
In fact, it is now widely recognized that Groupthink-like behavior is found in many
situations and across many types of groups and team settings. So it's important to look
out for the key symptoms.
Symptoms of Groupthink
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Rationalization:
This is when team members convince themselves that
despite evidence to the contrary, the decision or
alternative being presented is the best one.
"Those other people don't agree with us because they
haven't researched the problem as extensively as we
have."
Peer Pressure:
When a team member expresses an opposing opinion or
questions the rationale behind a decision, the rest of the
team members work together to pressure or penalize that
person into compliance.
"Well if you really feel that we're making a mistake you can
always leave the team."
Complacency:
After a few successes, the group begins to feel like any
decision they make is the right one because there is no
disagreement from any source.
"Our track record speaks for itself. We are unstoppable!"
Moral High Ground:
Each member of the group views him or herself as moral:
The combination of moral minds is therefore thought not to
be likely to make a poor or immoral decision. When
morality is used as a basis for decision-making, the pressure
to conform is even greater because no individual wants to
be perceived as immoral.
"We all know what is right and wrong, and this is definitely
right."
Stereotyping:
As the group becomes more uniform in their views, they
begin to see outsiders as possessing a different and inferior
set of morals and characteristics from themselves. These
perceived negative characteristics are then used to
discredit the opposition.
"Lawyers will find any excuse to argue, even when the
facts are clearly against them."
Censorship:
Members censor their opinions in order to conform.
"If everyone else agrees then my thoughts to the contrary
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must be wrong."
Information that is gathered is censored so that it also
conforms to, or supports the chosen decision or alternative.
"Don't listen to that nonsense, they don't have a clue about
what is really going on."
Illusion of Unanimity:
Because no one speaks out, everyone in the group feels
the group's decision is unanimous. This is what feeds the
Groupthink and causes it to spiral out of control.
"I see we all agree so it's decided then."
How to Avoid Groupthink
The challenge for any team or group leader is to create a working environment in
which Groupthink is unlikely to happen. It is important also to understand the risks of
Groupthink – if the stakes are high, you need to make a real effort to ensure that
you're making good decisions.
To avoid Groupthink, it is important to have a process in place for checking the
fundamental assumptions behind important decisions, for validating the decisionmaking process, and for evaluating the risks involved. For significant decisions, make
sure your team does the following in their decision-making process:

Explores objectives.

Explores alternatives.

Encourages ideas to be challenged without reprisal.

Examines the risks if the preferred choice is chosen.

Tests assumptions.

If necessary, goes back and re-examines initial alternatives that were
rejected.

Gathers relevant information from outside sources.

Processes this information objectively.

Has at least one contingency plan.
There are many group techniques that can help with this, including the "Mind Tools"
listed below. By using one or more of these techniques to accomplish aspects of the
group's work, you will vary the group's ways of working, and so guard against
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Groupthink and help make better decisions.
Tools That Help You Avoid Groupthink
Group Techniques:
Brainstorming
Helps ideas flow freely without criticism.
Nominal Group
Allows each group member to contribute individually, so
Technique
mitigating the risk that stronger and more persuasive
group members dominate the decision making process.
Six Thinking Hats
Helps the team look at a problem from many different
perspectives, allowing people to play "Devil's Advocate".
The Delphi Technique
Allows team members to contribute individually, with no
knowledge of a group view, and with little penalty for
disagreement.
Decision Support Tools:
Risk Analysis
Helps team members explore and manage risk.
Impact Analysis
Ensures that the consequences of a decision are
thoroughly explored.
The Ladder of
Inference
Helps people check and validate the individual steps of
a decision-making process.
How to Overcome Groupthink
However, if Groupthink does set in, it's important that you recognize and
acknowledge it quickly, so that you can overcome it and quickly get back to
functioning effectively.
Follow these steps to do this:
1.
Even with good group decision-making processes in place, be on the
lookout for signs of Groupthink, so you can deal with them swiftly.
2.
If there are signs of Groupthink, discuss these in the group. Once
acknowledged, the group as a whole can consciously free up its decision
making.
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3.
Assess the immediate risks of any decision, and the consequences for the
group and its customers. If risks are high (for example risk of personal safety),
make sure you take steps to fully validate any decision before it is ratified.
4.
If appropriate, seek external validation, get more information from outside,
and test assumptions. Use the bullets above as a starting point in diagnosing
things that needs to change.
5.
Introduce formal group techniques and decision-making tools, such as the
ones listed above, to avoid Groupthink in the future.
Key Points
Groupthink can severely undermine the value of a group's work and, at its worst, it can
cost people their lives.
On a lesser scale, it can stifle teamwork, and leave all but the most vocal team
members disillusioned and dissatisfied. If you're on a team that makes a decision you
don't really support but you feel you can't say or do anything about it, your enthusiasm
will quickly fade.
Teams are capable of being much more effective than individuals but, when
Groupthink sets in, the opposite can be true. By creating a healthy group-working
environment, you can help ensure that the group makes good decisions, and
manages any associated risks appropriately.
Group techniques such as Brainstorming, the Nominal Group Technique and Six
Thinking Hats can help with this, as can other decision making and thinking tools.
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Reading resources – Charette Procedure
Tips For Charette Procedure, March 01 2001,
http://www.extension.iastate.edu/communities/tools/decisions/charette.html
(Brainstorming multiple ideas with multiple stakeholders)
The Charette Procedure is a group idea generating and prioritizing tool. Its strength is
its ability to address several issues at once in a highly interactive group setting. The
charette procedure involves several small groups simultaneously discussing parts of
the "big picture," then passing their ideas on to the next group for refinement,
enlargement, and eventually, prioritization. The charette procedure is especially useful
when a group has decided what they want to do, but is unsure of all the details
involved in how to do it.
The technique is effective for:

Addressing several issues simultaneously

Encouraging active participation

Sharing leadership among group members

Building on ideas generated by others

Keeping discussion active and interesting
An Illustration of the Charette Procedure:
A community group has decided that they want to build a skateboard park for the
area's youth. Their task now is to decide how to implement their plan for a skateboard
park. The group decides to address the following issues:
1. Where should the skateboard park be located?
2. How should the issue of liability be handled?
3. Where are the funds going to come from to build the park?
4. How are they going to raise the public's interest and acceptance for the
project?
To start the Charette Procedure, the group is divided into four smaller groups, one for
each of the issues to be addressed. Each small group is assigned one of the issues to
discuss. Each small group designates someone to record all the ideas generated. The
small groups brainstorm to generate as many ideas as possible. The recorders write all
ideas on newsprint. After about 10 minutes, the discussion is stopped and the
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recorders take the newsprint and move on to the next group. The next group reviews
the newsprint items, refines and adds their own. The rotation continues until each
group has discussed each of the four issues. The last small group in the rotation
priorities the newsprint items. The total group is reconvened. The recorders for each
issue report on the priorities set.
Procedure
1. Divide the participants into small groups (5 - 7 people), either by numbering
off, or some other method.
2. Ask each group to select a recorder, then provide each group with a
discussion topic or question. If there are many small groups, some groups may
get the same discussion topic or question; otherwise, each group should get a
different topic for discussion.
3. Establish a time limit (8 to 10 minutes) for the groups to generate ideas in
response to the topic. The recorder should write all responses on newsprint.
4. The leader gives a two minute warning then calls time at the end of the time
period. The recorders take the newsprint responses from their group and rotate
to the next group, i.e., the topic goes with the recorder. A suggested rotation
order for the recorders (and the topics) is shown below.
Group
1
Group
2
Group
4
Group
3
5. Once the recorder joins his/her new group, all groups are asked to review the
information generated by the previous group and quickly add any other ideas
they have.
6. Repeat steps 3 - 5 until each group has had an opportunity to discuss every
issue. During the last rotation, each group should prioritize the most significant
or important ideas generated on that topic.
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7. The total group is reconvened. Each recorder displays the newsprint and
summarizes the discussion and priorities generated by the topic.
8. At this point, the total group may want to discuss the small group reports and
review priorities and reach consensus.
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Reading resources – Crawford’s Slip Writing Method
Generating ideas from many contributors,
http://www.mindtools.com/pages/article/newCT_95.htm
How do you unlock the collective knowledge and ideas of your team, your
department or even your whole organization? And how do you do this in a way that
everyone (not just those with the biggest egos) gets heard?
The Crawford Slip Method is a simple yet effective type of brainstorming that gives the
opinions of all team members equal weight, however quiet they are.
In fact, you probably will have encountered this way of generating ideas and solutions
even if you haven't called it the Crawford Slip Method.
Invented in the 1920s by Dr. C.C. Crawford, Professor of Education at the University of
Southern California, the method simply involves collating input from people on slips of
paper (nowadays often on Post-It Notes®).
Not only does this help you generate a wide variety of solutions, it also helps people
get involved and feel that their contributions are valued. Writing rather than speaking
during the session can have added advantages: it helps people to think freely without
interruption, and it levels the playing field between quieter people and more
outspoken participants.
More than this, as peoples individual contributions are brought together into groupings
of similar ideas, it gives you a feel for the overall "popularity" of each idea.
Tip 1:
The Crawford Slip Method and other creative brainstorming techniques focus on
generating ideas and contributions, rather than how to use these to create a group
outcome. If, however, your main need is to achieve consensus on a particular issue,
consider using the Nominal Group Technique instead. This is a useful method for
achieving a robust group consensus on controversial issues.
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Reading resources – Step ladder technique
Making better group decisions,
http://www.mindtools.com/pages/article/newTED_89.htm
Making decisions within a group can often be challenging. When things go well, they
can go very well. However, when things go wrong, you can end up mired in conflict.
Some people may fight for recognition and position, others may be over-critical or
disruptive, while others may sit quietly and not contribute anything to the overall effort.
Because of this, groups can often spin out of control and make worse decisions than
individuals working on their own.
When this happens, it's easy to see why some people throw their hands up in
frustration and give up. However, when a group works in the right way, it really WORKS.
Groups that function effectively together can outperform individuals and make much
better decisions.
But how do you make your group effective? How do you get all group members to
contribute and inspire one another to create great ideas and solutions?
The Stepladder Technique is a useful method for encouraging individual participation
in group decision making.
What is the Stepladder Technique?
The Stepladder Technique is a simple tool that manages how members enter the
decision-making group. Developed by Steven Rogelberg, Janet Barnes-Farrell and
Charles Lowe in 1992, it encourages all members to contribute on an individual level
BEFORE being influenced by anyone else. This results in a wider variety of ideas, it
prevents people from "hiding" within the group, and it helps people avoid being
"stepped on" or overpowered by stronger, louder group members.
All of this helps the group make better decisions.
How to Use the Tool
The Stepladder Technique has five basic steps. Here's how it works.
Step 1: Before getting together as a group, present the task or problem to all
members. Give everyone sufficient time to think about what needs to be done and to
form their own opinions on how to best accomplish the task or solve the problem.
Step 2: Form a core group of two members. Have them discuss the problem.
Step 3: Add a third group member to the core group. The third member presents ideas
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to the first two members BEFORE hearing the ideas that have already been discussed.
After all three members have laid out their solutions and ideas, they discuss their
options together.
Step 4: Repeat the same process by adding a fourth member, and so on, to the
group. Allow time for discussion after each additional member has presented his or
her ideas.
Step 5: Reach a final decision only after all members have been brought in and
presented their ideas.
The Stepladder Technique is similar to the Delphi Method, another tool that's often
used in groups to prevent Groupthink and to encourage participation. While both
tools have the same objective, they differ in a few key ways:

In the Delphi Method, an objective facilitator or leader manages the group.
In the Stepladder Technique, all members are equal.

The Delphi Method keeps members anonymous. The facilitator manages
the flow of information, and members may have no idea who else is in the
group. The Stepladder Technique involves face-to-face meetings, so
everyone knows who the other members are.

The Delphi Method is a lengthy process, while the Stepladder Technique is
much quicker.

The Delphi Method is often used for major decisions that need input from a
large number of people. The Stepladder Technique works best with smaller
groups that make a wide range of decisions.
Tip:
Groups can begin to lose their effectiveness and ability to make good quality
decisions if they have too many members. Keep your group small – four to seven team
members – to maximize effectiveness.
Key Points
The Stepladder Technique is a step-by-step approach that helps you ensure that all
members of a group participate and are heard. The technique allows shy, quiet
people to present their ideas before other group members can influence them, and it
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allows everyone to hear many different viewpoints before reaching a final decision.
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Case study: Corporate decision making
A company well established in the manufacture of automobile accessories discusses
a proposal to diversify in to manufacture of computer hardware accessories. Opinion
in the top management is divided - some want to stick only to the proven core
business line and some are very enthusiastic to diversify. The Chief executive has to
decide yes or no for diversification.
Let us assume that the chief executive decides in favour of diversifying into
manufacture of computer accessories. Now, he would be confronted with decision
making on several issues. He has to start off with defining the problems. Using our
decision making process steps lets help him consider the following:
1) Establishing a positive decision-making environment:
Consider:

What is the objective?

What process will we adopt?

Who should be involved in the decision making process?

How can you ensure that opinions are shared and heard?

Asking the right questions.
For example:

whether to float a separate company for the purpose in a new name,
at a new infrastructure or produce the new products in the existing set
up;

whether to use the same company name / brand name (and to utilize
the familiarity and reputation);

whether to go for indigenous or imported technology;

whether to hire totally new managerial team or utilize some of the
existing talent pool in the company for key administrative positions;

whether to locate the factory adjacent to the existing factory or find a
totally new location, etc.
Further consideration:

the manager requires information (other than market potential,
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availability of funds and profitability related facts, which he should have
already done while deciding prima facie in favour of diversification)
covering:

Legal, Tax, statutory and other issues involved in the manufacture
of new products from same company or from separate company;

Sources of technology, relative costs, relative reputation, benefits
and limitations;

Effect of existing managerial structure and availability of second
line of talent in case some of the existing senior executives are
shifted to new product line - etc.
2) Generating potential solutions:
Consider:

What are the best tools/ techniques to generate Ideas?

How can we include different perspectives?

How can we organise ideas into workable solutions?
For example:

the plant be location to achieve the best strategic advantage;

the cost implications of the selected sites, and does a cost benefit
analysis effectively capture the data required to decide on a location.
Site ”X” might have access to infrastructure, but not to labour, site “Y”
could provide access to resources and suppliers but the capital costs
impact on the long-term viability of the product-line, etc;

access to market – international and local and the cost implications of
each.
Further considerations:

in the current stage of discussions, involving the executives who can be
considered for manning the new product-line may create undue
expectations and unhealthy rumours about shifts and promotions.

decisions about using existing brand name or creating a new brand
name will definitely be one needing more opinions and it cannot be
simply decided based on any facts and figures.
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3) Evaluating the solutions and exploring the alternatives :
Consider:

What is the risk involved in the different solutions? What are the potential
consequences (implications) of each solution?

Do the solutions match your objective?

Do you have the resources?

Will the solution work in the short- or long-term?
For example:

If the plant is located in place "X" will it get any Government subsidies or
special tax benefits and consequently will it be better than locations "Y"
or "Z" which are strategically more convenient?

Will the collaborators "A" help getting export markets when compared
to "B" who are more respectable in domestic market only?
Further considerations:

how to align the proposed solutions with the objectives and the
company strategy.

Long-term impact – advantages and disadvantages.
4) Choose the Best Alternative
Consider:

What criteria will we use to decide on the best alternative?

Who will be involved in the decision making?

Which solution best meets your strategic objects?

ROI of the differing solutions? Not simply looking at the financial aspects

Who will take responsibility for implementation?

How will we evaluate the results and incorporate the learning into the
organisation?
For example:

The chief executive has decided to include input from employees at all
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levels and a workshop has been planned to inform employees of the
expansion.

The chief executive has decided to make an executive decision and
has simply informed employees of the expansion.
Further considerations:

Time required for a more inclusive process, allowing for a greater
number of people to participate in the decision making process. How
does this translate into cost to company and “bottom-line” impact on
the viability of introducing the new product line?

The impact on moral and productivity if this remains an executive
decision.
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