Our success in business, as in life, depends upon our ability to make the right decisions.  That might sound simple enough, but there’s more to it.

What Influences Our Decision Making Ability?

Obviously, there are individual factors affecting our decision making ability.  How much insight do the decision-makers have? How good are they at unravelling complexity and seeing the real issues?  To make good decisions, decision-makers must possess the capacity to see the wood for the trees and respond in balanced ways.

But there are also structural factors that influence decision making.  Here are three you might find helpful.

Consensus Level

Consensus level concerns situations where there are multiple decision-makers.  It relates to how much agreement is necessary before a decision can be made.  If the consensus level is relatively high (say, 75% of decision-makers must agree) it generally results in fewer poor decisions made, but also fewer good opportunities taken.

On the other hand, if the consensus level is relatively low (say, anything over 50% agreement is needed) more good opportunities are grasped, but also the number of poorer decisions increases.

Voting Rules

This refers to how power is distributed among decision-makers. Are some people more influential than others?

Sometimes, often because of hierarchical positions or strengths of personality, some decision-makers have more power to influence decisions that others.  A team of 8 decision-makers might consist of one or two who skew decisions in their favour – perhaps they intimidate others, or maybe they are just better communicators.

Information Source

This refers to how decision-makers source the information upon which they base their decisions.  Whose reality does the information reflect?

Sometimes, in very hierarchical organisations where information flow systems work primarily from the top down, high level decision-makers source their information from the immediate levels below them.  Because information struggles to make an upward movement through the organisational layers, the information upon which decisions are made often have little or no relevance to people on the lower levels of the structure.

So, What Are The Three Tips?

First, set the consensus level at an appropriate level for your industry.  If you need to be innovative and entrepreneurial, set the consensus level lower.  If you can’t afford to take risks, set it higher.

Second, conduct an open and frank audit about how power works in the decision-making team.  If there are inequities, discuss them and look for solutions.

Third, make sure you source high-quality, relevant information. Your team’s change fitness should be part of that information.

Dr Steve Barlow