Jack Zenger and Joseph Folkman used a set of research conclusions to ponder the question; “What causes well-meaning people to make poor decisions?” They contributed an article to Business Insider entitled, 9 Habits That Lead to Terrible Decisions.
In an effort to understand the root cause of poor decision making, they studied some 360-feedback data from more than 50,000 leaders and compared the behavior of those who were perceived to be making poor decisions with those perceived to be making very good decisions. They did a factor analysis of the behaviors that made the most statistical difference between the best and worst decision-makers.
Nine factors emerged as the most common paths to poor decision-making. The nine (9) habits are listed below, but you can read the original article here.
- Laziness – This manifested as a failure to check facts, take the initiative to confirm assumptions, or to gather additional information. These individuals exhibited sloppiness in their work and unwillingness to exert themselves. They relied on past experience and expected results simply to be an extrapolation of the past.
- Failure to anticipate unexpected events – No one likes to consider the possibility of negative events and assume the worst will not happen. Unfortunately, bad things do happen in personal relationships, investments, home prices and unreliable friends. Research demonstrates that considering what might go wrong, will help to anticipate problems. However, the excitement of a decision may allow us to forego the require due-diligence.
- Indecisiveness – On the other hand, we could suffer from the “paralysis of analysis” when dealing with a complex decision that is based on constantly changing data. This makes it easy to continue to study the data, ask for one more report, or perform yet another analysis before making a decision. The time delay could make a good decision appear to be a bad one. Further, indecision could be worse than making the wrong decision. Fear of career or business failure may cause us to adopt a risk avoidance attitude.
- Rooted in the past – Poor decisions occur when we rely on old data or processes. It is even possible that your old approaches actually worked in the past. But we should be searching for approaches that will work better. The old approach may be based on assumptions that are no longer true. Baseline assumptions should be updated frequently, based on the speed of your industry.
- No strategic alignment – Bad decisions sometimes stem from a failure to connect the problem to the overall strategy. In the absence of a clear strategy that provides context, many solutions appear to make sense. When tightly linked to a clear strategy, the better solutions quickly begin to rise to the top.
- Over-dependence – Some decisions are never made because one person is waiting for another, who in turn is waiting for someone else’s decision or input. Effective decision makers find a way to act independently when necessary.
- Isolation – Some leaders find themselves waiting for input because they’ve not established the steps to receive it in a timely manner. The research recognized that involving others with the relevant knowledge, experience, and expertise improves the quality of the decision. Some people may lack the necessary networking skills to access the right information in a timely fashion. Sometimes, people do not involve others because they want to take sole credit for a decision. Unfortunately, they get to take the sole blame for the bad decisions, as well.
- Insufficient technical depth – Leaders in complex organizations may not have sufficient technical depth to fully understand multifaceted issues. Reliance on subject matter experts, without sufficient perspectives of their own, may lead to the inability to integrate new information into the making of an effective decision. Decision makers with deep expertise can make a better judgement as to the brilliance or stupidity of a decision.
- Failure to communicate decision rationale – Some good decisions become bad decisions because relevant people may not have been advised of the decision. Communicating a decision, its rational and implications, is critical to the successful implementation of any decision.
The path to good decision-making is not always clearly marked. But changing these nine habits can help us to become more effective decision makers.
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