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How good are your decisions?
1:55am - 23/02/2016

We were looking forward to a family skiing holiday. However, a decision needed to be made and it was proving difficult. I wanted to drive to France, giving us more days skiing for the same money, whereas my wife wanted to fly, a more comfortable and child friendly option. My daughter had made some good points in favour of both options and it seemed like a great opportunity to include her in the decision making process.  My wife sighed as she recognised “Daddy coach” coming to the fore, and went to make some coffee as we gathered up all the teddies in the house. With a line marked out in the middle of the lounge, I explained to them that one side of the line was for driving, and the other for flying. For every positive reason we had for either option, we could add a teddy to that side. The better the reason – the bigger the teddy. We all agreed that we would go with the best decision – soon to be known as the teddies decision. My daughter has a lot of teddies, and in no time we had a sea of smiling faces on both sides, representing a surprising variety of reasons, ranging from environmental considerations, to food options during the journey, to when iPads could be charged. It has to be said though, that after an enthusiastic start, the cuddly atmosphere cooled somewhat as we increasingly challenged each other about our facts and refused to accept others opinions. Although we had all started by adding teddies to both sides, it wasn’t long before we were coming up with more and more spurious reasons to add a teddy to a particular side. What had started as a fun discussion was beginning to feel pretty loaded. The decision making process was coming unstuck and the teddies were looking concerned…


Most senior leaders have a wealth of experience making good operational and tactical decisions.  And yet, far too often, we see great organisations making important strategic decisions that fail.

R&D projects overcommitted, product launches fail to match expectations, investment projects overspent and late. In a McKinsey survey of 2,207 executives, only 28% said that the quality of strategic decisions in their companies was generally good. Now whilst a few may need to look to their business processes, most will have spent significant time and money developing robust processes including rigorous analysis to support their decision making.

Dan Lovallo (reference) suggests that leaders’ subconscious biases significantly undermine strategic decision making. Examples of biases might be:

- over weighting recent significant events

- over commitment to a first opinion or hunch that then focusses on supporting rather than contradictory evidence

- over reliance on past experience that may be misleading

You can download fuller list of potential biases here.

We all like to think that we are able to unbiased, using our intellect to come to sound decisions. In his book “Thinking fast and Slow”, the Nobel Prize winner Daniel Kahneman provides numerous simple experiments that demonstrate that our minds are dominated by habits that can often make our decisions anything but rational. So we need to be aware of our biases, and encourage open discussion of them when making group decisions. We need to be willing to look at the situation from different perspectives, and hold our own opinions lightly. This requires us to ask questions, listen, seek out conflicting views, and challenge assumptions. So improving the decisions in our organisation starts with ourselves.

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