Order the choices based on the likelihood of success. As you go through this process, you’ll begin to favor certain outcomes that appear to have a higher potential for reaching your goal. Evaluate whether each choice would meet the need you identified in step 1. Review the data you’ve gathered to determine the impact each alternative will have on your organization. You can also use your resourcefulness and additional data to identify new choices. List all possible and desirable alternatives as well as the associated risks. You or your team will likely find several possible paths to take. Some of the information will be available in your organization’s policies, procedures and internal databases. Other information may come from online sources, books, surveys, polls or consultants. This process may involve both internal and external research. Find out what information you need, the best sources of information and how to collect it. This step is critical, as correctly pinpointing the need will drive the rest of the process.Ĭollect relevant information before making a decision. The following approach increases the odds that they will make the right decision for their organization.Ĭlearly identify the need of your department or organization. Using a strategic decision-making process will help leaders make more thoughtful and thorough decisions by organizing information and alternatives.
The following seven steps can help executives avoid biases and make effective decisions. Decision-making is the process of making choices by identifying a need, gathering information and assessing alternative resolutions. They assume that their way of thinking or behaving is typical and, therefore, that their customers, vendors, teams and colleagues will respond in a similar manner. This bias involves overestimating the degree to which other people agree with our decisions. Leaders with this bias tend to assume that others think, feel, believe and behave as they do. The bias could result in a lack of input from a certain team member. For leaders to makes good decisions, they need to be able to consider information from all sources. The bias blind spot occurs when we are not aware of our own biases. Senior managers often do not see that they have a bias, but every decision they make will revolve around it. It is important for senior leaders to review all sources of information to make an informed decision. To save time and avoid confirmation and anchoring biases, they can assign work to small teams or work groups to gather the information and provide an executive summary of the results.
Sometimes, the person who makes the decision retains his or her position, while whole departments are laid off. Making decisions based on a single piece of information can result in lost revenue, productivity and even employment. Leaders will use one piece of information to justify a decision and will reject any information to the contrary. In many cases, anchoring bias, or overreliance on a single piece of information, is closely related to confirmation bias. Once leaders form this view, they will only accept data that confirms it, and they will ignore or reject any information that casts doubt on it. This error leads them to stop gathering information when the evidence they’ve collected so far confirms the views or prejudices they would like to be true. Senior leaders can make fatal decisions that are steeped in their own desires or beliefs in other words, they are motivated by wishful thinking. The Three Biases That Lead to Poor Decision-makingĬonfirmation bias occurs when we interpret events so that they support prior conclusions. Let’s review the three biases that derail effective executive decision-making and the seven steps of an effective decision-making strategy. Some of these decisions will have an influence on the survival of their careers and companies. Effective decision-making is an executive’s most important responsibility and one that can easily go wrong.
#EXECUTIVE DECISIONS PROFESSIONAL#
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